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MORTGAGE LOAN PURCHASE AGREEMENT
between
BEAR XXXXXXX COMMERCIAL MORTGAGE, INC.
as Seller
and
XXXXXX XXXXXXX CAPITAL I INC.
as Purchaser
Dated as of July 19, 2006
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TABLE OF CONTENTS
1. AGREEMENT TO PURCHASE................................................ 3
2. CONVEYANCE OF MORTGAGE LOANS......................................... 3
3. EXAMINATION OF MORTGAGE FILES AND DUE DILIGENCE REVIEW............... 10
4. REPRESENTATIONS AND WARRANTIES OF SELLER AND PURCHASER............... 12
5. REMEDIES UPON BREACH OF REPRESENTATIONS AND WARRANTIES MADE
BY SELLER............................................................ 15
6. CLOSING.............................................................. 20
7. CLOSING DOCUMENTS.................................................... 21
8. COSTS................................................................ 24
9. NOTICES.............................................................. 24
10. SEVERABILITY OF PROVISIONS........................................... 24
11. FURTHER ASSURANCES................................................... 24
12. SURVIVAL............................................................. 24
13. GOVERNING LAW........................................................ 25
14. BENEFITS OF MORTGAGE LOAN PURCHASE AGREEMENT......................... 25
15. MISCELLANEOUS........................................................ 25
16. ENTIRE AGREEMENT..................................................... 25
Exhibit 1 Mortgage Loan Schedule
Exhibit 2 Representations and Warranties
Exhibit 3 Pricing Formulation
Exhibit 4 Xxxx of Sale
Exhibit 5 Power of Attorney
Index of Defined Terms
Affected Loan(s)........................................................... 17
Agreement.................................................................. 2
Certificate Purchase Agreement............................................. 2
Certificates............................................................... 2
Closing Date............................................................... 3
Collateral Information..................................................... 10
Crossed Mortgage Loans..................................................... 17
Defective Mortgage Loan.................................................... 17
Final Judicial Determination............................................... 19
Indemnification Agreement.................................................. 13
Initial Purchasers......................................................... 2
Master Servicer............................................................ 2
Material Breach............................................................ 15
Material Document Defect................................................... 15
Memorandum................................................................. 2
MERS....................................................................... 5
Mortgage File.............................................................. 4
Mortgage Loan Schedule..................................................... 3
Mortgage Loans............................................................. 2
Officer's Certificate...................................................... 7
Other Mortgage Loans....................................................... 2
Pooling and Servicing Agreement............................................ 2
Private Certificates....................................................... 2
Prospectus Supplement...................................................... 2
Public Certificates........................................................ 2
Purchaser.................................................................. 2
Repurchased Loan........................................................... 17
Seller..................................................................... 2
Special Servicer........................................................... 2
Trust...................................................................... 2
Trustee.................................................................... 2
Underwriters............................................................... 2
Underwriting Agreement..................................................... 2
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MORTGAGE LOAN PURCHASE AGREEMENT
(BEAR XXXXXXX COMMERCIAL MORTGAGE, INC. LOANS)
Mortgage Loan Purchase Agreement ("Agreement"), dated as of July 19, 2006,
between Bear Xxxxxxx Commercial Mortgage, Inc. ("Seller") and Xxxxxx Xxxxxxx
Capital I Inc. ("Purchaser").
Seller agrees to sell and Purchaser agrees to purchase certain mortgage loans
listed on Exhibit 1 hereto (the "Mortgage Loans") as described herein. Purchaser
will convey the Mortgage Loans to a trust (the "Trust") created pursuant to a
Pooling and Servicing Agreement (the "Pooling and Servicing Agreement"), to be
dated as of August 1, 2006 between Purchaser, as depositor, Xxxxx Fargo Bank,
National Association, as master servicer (the "Master Servicer"), ARCap
Servicing, Inc., as special servicer (the "Special Servicer"), LaSalle Bank
National Association, as trustee and custodian (the "Trustee") and Xxxxx Fargo
Bank, National Association, as paying agent, certificate registrar and
authenticating agent. In exchange for the Mortgage Loans and certain other
mortgage loans to be purchased by Purchaser (collectively the "Other Mortgage
Loans"), the Trust will issue to the Depositor pass-through certificates to be
known as Xxxxxx Xxxxxxx Capital I Inc., Commercial Mortgage Pass-Through
Certificates, Series 2006-TOP23 (the "Certificates"). The Certificates will be
issued pursuant to the Pooling and Servicing Agreement.
Capitalized terms used herein but not defined herein shall have the meanings
assigned to them in the Pooling and Servicing Agreement.
The Class A-1, Class A-2, Class A-3, Class A-AB, Class A-4, Class A-M and Class
A-J Certificates (the "Public Certificates") will be sold by Purchaser to Bear,
Xxxxxxx & Co. Inc. and Xxxxxx Xxxxxxx & Co. Incorporated (the "Underwriters"),
pursuant to an Underwriting Agreement, between Purchaser and the Underwriters,
dated July 19, 2006 (the "Underwriting Agreement"), and the Class X, Class B,
Class C, Class D, Class E, Class F, Class G, Class H, Class J, Class K, Class L,
Class M, Class N, Class O, Class P, Class R-I, Class R-II and Class R-III
Certificates (the "Private Certificates") will be sold by Purchaser to Bear,
Xxxxxxx & Co. Inc. and Xxxxxx Xxxxxxx & Co. Incorporated (the "Initial
Purchasers") pursuant to a Certificate Purchase Agreement, between Purchaser and
the Initial Purchasers, dated July 19, 2006 (the "Certificate Purchase
Agreement"). The Underwriters will offer the Public Certificates for sale
publicly pursuant to a Prospectus dated March 14, 2006, as supplemented by a
Prospectus Supplement dated July 19, 2006 (together, the "Prospectus
Supplement") and the Initial Purchasers will offer the Private Certificates for
sale in transactions exempt from the registration requirements of the Securities
Act of 1933 pursuant to a Private Placement Memorandum dated July 19, 2006 (the
"Memorandum").
In consideration of the mutual agreements contained herein, Seller and Purchaser
hereby agree as follows:
Article I. AGREEMENT TO PURCHASE.
Section 1.01 Seller agrees to sell, and Purchaser agrees to purchase, on a
servicing released basis, the Mortgage Loans identified on the schedule (the
"Mortgage Loan Schedule") annexed hereto as Exhibit 1, as such schedule may be
amended to reflect the actual Mortgage Loans accepted by Purchaser pursuant to
the terms hereof. The Cut-Off Date with respect to the Mortgage Loans is August
1, 2006. The Mortgage Loans will have an aggregate principal balance as of the
close of business on the Cut-Off Date, after giving effect to any payments due
on or before such date, whether or not received, of $440,961,906. The sale of
the Mortgage Loans shall take place on August 3, 2006 or such other date as
shall be mutually acceptable to the parties hereto (the "Closing Date"). The
purchase price to be paid by Purchaser for the Mortgage Loans shall equal the
amount set forth as such purchase price on Exhibit 3 hereto. The purchase price
shall be paid to Seller by wire transfer in immediately available funds on the
Closing Date.
Section 1.02 On the Closing Date, Purchaser will assign to the Trustee pursuant
to the Pooling and Servicing Agreement all of its right, title and interest in
and to the Mortgage Loans and its rights under this Agreement (to the extent set
forth in Section 14 hereof), and the Trustee shall succeed to such right, title
and interest in and to the Mortgage Loans and Purchaser's rights under this
Agreement (to the extent set forth in Section 14 hereof).
Article II. CONVEYANCE OF MORTGAGE LOANS.
Section 2.01 Effective as of the Closing Date, subject only to receipt of the
consideration referred to in Section 1 hereof and the satisfaction of the
conditions specified in Sections 6 and 7 hereof, Seller does hereby transfer,
assign, set over and otherwise convey to Purchaser, without recourse, except as
specifically provided herein all the right, title and interest of Seller, with
the understanding that a Servicing Rights Purchase and Sale Agreement, dated
August 1, 2006, will be executed by Seller and the Master Servicer, in and to
the Mortgage Loans identified on the Mortgage Loan Schedule as of the Closing
Date. The Mortgage Loan Schedule, as it may be amended from time to time on or
prior to the Closing Date, shall conform to the requirements of this Agreement
and the Pooling and Servicing Agreement. In connection with such transfer and
assignment, Seller shall deliver to or on behalf of the Trustee, on behalf of
Purchaser, on or prior to the Closing Date, the Mortgage Note (as described in
clause 2.2.1 hereof) for each Mortgage Loan and on or prior to the fifth
Business Day after the Closing Date, five limited powers of attorney
substantially in the form attached hereto as Exhibit 5 in favor of the Trustee
and the Special Servicer to empower the Trustee and, in the event of the failure
or incapacity of the Trustee, the Special Servicer, to submit for recording, at
the expense of Seller, any mortgage loan documents required to be recorded as
described in the Pooling and Servicing Agreement and any intervening assignments
with evidence of recording thereon that are required to be included in the
Mortgage Files (so long as original counterparts have previously been delivered
to the Trustee). Seller agrees to reasonably cooperate with the Trustee and the
Special Servicer in connection with any additional powers of attorney or
revisions thereto that are requested by such parties for purposes of such
recordation. The parties hereto agree that no such power of attorney shall be
used with respect to any Mortgage Loan by or under authorization by any party
hereto except to the extent that the absence of a document described in the
second preceding
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sentence with respect to such Mortgage Loan remains unremedied as of the earlier
of (i) the date that is 180 days following the delivery of notice of such
absence to Seller, but in no event earlier than 18 months from the Closing Date,
and (ii) the date (if any) on which such Mortgage Loan becomes a Specially
Serviced Mortgage Loan. The Trustee shall submit such documents, at Seller's
expense, after the periods set forth above, provided, however, the Trustee shall
not submit such assignments for recording if Seller produces evidence that it
has sent any such assignment for recording and certifies that Seller is awaiting
its return from the applicable recording office. In addition, not later than the
30th day following the Closing Date, Seller shall deliver to or on behalf of the
Trustee each of the remaining documents or instruments specified in Section 2.2
hereof (with such exceptions as are permitted by this Section 2) with respect to
each Mortgage Loan (each, a "Mortgage File"). (Seller acknowledges that the term
"without recourse" does not modify the duties of Seller under Section 5 hereof.)
Section 2.02 All Mortgage Files, or portions thereof, delivered prior to the
Closing Date are to be held by or on behalf of the Trustee in escrow on behalf
of Seller at all times prior to the Closing Date. The Mortgage Files shall be
released from escrow upon closing of the sale of the Mortgage Loans and payments
of the purchase price therefor as contemplated hereby. The Mortgage File for
each Mortgage Loan shall contain the following documents:
(a) The original Mortgage Note bearing all intervening endorsements,
endorsed "Pay to the order of LaSalle Bank National Association, as
Trustee for Xxxxxx Xxxxxxx Capital I Inc., Commercial Mortgage
Pass-Through Certificates, Series 2006-TOP23, without recourse,
representation or warranty" or if the original Mortgage Note is not
included therein, then a lost note affidavit, with a copy of the
Mortgage Note attached thereto;
(b) The original Mortgage, with evidence of recording thereon, and, if the
Mortgage was executed pursuant to a power of attorney, a certified
true copy of the power of attorney certified by the public recorder's
office, with evidence of recording thereon (if recording is customary
in the jurisdiction in which such power of attorney was executed), or
certified by a title insurance company or escrow company to be a true
copy thereof; provided that if such original Mortgage cannot be
delivered with evidence of recording thereon on or prior to the 45th
day following the Closing Date because of a delay caused by the public
recording office where such original Mortgage has been delivered for
recordation or because such original Mortgage has been lost, Seller
shall deliver or cause to be delivered to the Trustee a true and
correct copy of such Mortgage, together with (i) in the case of a
delay caused by the public recording office, an Officer's Certificate
(as defined below) of Seller stating that such original Mortgage has
been sent to the appropriate public recording official for recordation
or (ii) in the case of an original Mortgage that has been lost after
recordation, a certification by the appropriate county recording
office where such Mortgage is recorded that such copy is a true and
complete copy of the original recorded Mortgage;
(c) The originals of all agreements modifying a Money Term or other
material modification, consolidation and extension agreements, if any,
with evidence of recording thereon, or if any such original
modification, consolidation or extension agreement has been delivered
to the appropriate recording office for recordation and either has not
yet been returned on or prior to the 45th day following the Closing
Date with evidence of recordation thereon
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or has been lost after recordation, a true copy of such modification,
consolidation or extension certified by Seller together with (i) in
the case of a delay caused by the public recording office, an
Officer's Certificate of Seller stating that such original
modification, consolidation or extension agreement has been dispatched
or sent to the appropriate public recording official for recordation
or (ii) in the case of an original modification, consolidation or
extension agreement that has been lost after recordation, a
certification by the appropriate county recording office where such
document is recorded that such copy is a true and complete copy of the
original recorded modification, consolidation or extension agreement,
and the originals of all assumption agreements, if any;
(d) An original Assignment of Mortgage for each Mortgage Loan, in form and
substance acceptable for recording, signed by the holder of record in
favor of "LaSalle Bank National Association, as Trustee for Xxxxxx
Xxxxxxx Capital I Inc., Commercial Mortgage Pass-Through Certificates,
Series 2006-TOP23," provided, if the related Mortgage has been
recorded in the name of Mortgage Electronic Registration Systems, Inc.
("MERS") or its designee, no such assignments will be required to be
submitted for recording or filing and instead, Seller shall take all
actions as are necessary to cause the Trustee to be shown as the owner
of the related Mortgage on the record of MERS for purposes of the
system of recording transfers of beneficial ownership of mortgages
maintained by MERS and shall deliver to the Master Servicer and the
Special Servicer evidence confirming that the Trustee is shown as the
owner on the record of MERS;
(e) Originals of all intervening assignments of Mortgage (except with
respect to any Mortgage that has been recorded in the name of MERS or
its designees), if any, with evidence of recording thereon or, if such
original assignments of Mortgage have been delivered to the
appropriate recorder's office for recordation, certified true copies
of such assignments of Mortgage certified by Seller, or in the case of
an original blanket intervening assignment of Mortgage retained by
Seller, a copy thereof certified by Seller or, if any original
intervening assignment of Mortgage has not yet been returned on or
prior to the 45th day following the Closing Date from the applicable
recording office or has been lost, a true and correct copy thereof,
together with (i) in the case of a delay caused by the public
recording office, an Officer's Certificate of Seller stating that such
original intervening assignment of Mortgage has been sent to the
appropriate public recording official for recordation or (ii) in the
case of an original intervening Assignment of Mortgage that has been
lost after recordation, a certification by the appropriate county
recording office where such assignment is recorded that such copy is a
true and complete copy of the original recorded intervening Assignment
of Mortgage;
(f) If the related Assignment of Leases is separate from the Mortgage, the
original of such Assignment of Leases with evidence of recording
thereon or, if such Assignment of Leases has not been returned on or
prior to the 45th day following the Closing Date from the applicable
public recording office, a copy of such Assignment of Leases certified
by Seller to be a true and complete copy of the original Assignment of
Leases submitted for recording, together with (i) an original of each
assignment of such Assignment of Leases with evidence of recording
thereon and showing a complete recorded chain of assignment from the
named assignee to the holder of record, and if any such assignment of
such Assignment of Leases has not been returned from the applicable
public recording office,
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a copy of such assignment certified by Seller to be a true and
complete copy of the original assignment submitted for recording, and
(ii) an original assignment of such Assignment of Leases, in
recordable form, signed by the holder of record in favor of "LaSalle
Bank National Association, as Trustee for Xxxxxx Xxxxxxx Capital I
Inc., Commercial Mortgage Pass-Through Certificates, Series
2006-TOP23," which assignment may be effected in the related
Assignment of Mortgage, provided, if the related Mortgage has been
recorded in the name of MERS or its designee, no assignment of
Assignment of Leases in favor of the Trustee will be required to be
recorded or delivered and instead, Seller shall take all actions as
are necessary to cause the Trustee to be shown as the owner of the
related Mortgage on the record of MERS for purposes of the system of
recording transfers of beneficial ownership of mortgages maintained by
MERS and shall deliver to the Master Servicer and the Special Servicer
evidence confirming that the Trustee is shown as the owner on the
record of MERS;
(g) The original of each guaranty, if any, constituting additional
security for the repayment of such Mortgage Loan;
(h) The original Title Insurance Policy, or in the event such original
Title Insurance Policy has not been issued, an original binder or
actual title commitment or a copy thereof certified by the title
company with the original Title Insurance Policy to follow within 180
days of the Closing Date or a preliminary title report binding on the
title company with an original Title Insurance Policy to follow within
180 days of the Closing Date;
(i) (A) UCC financing statements (together with all assignments thereof)
and (B) UCC-2 or UCC-3 financing statements to the Trustee executed
and delivered in connection with the Mortgage Loan, provided, if the
related Mortgage has been recorded in the name of MERS or its
designee, no such financing statements will be required to be recorded
or delivered and instead, Seller shall take all actions as are
necessary to cause the Trustee to be shown as the owner of the related
Mortgage on the record of MERS for purposes of the system of recording
transfers of beneficial ownership of mortgages maintained by MERS and
shall deliver to the Master Servicer and the Special Servicer evidence
confirming that the Trustee is shown as the owner on the record of
MERS;
(j) Copies of the related ground lease(s), if any, to any Mortgage Loan
where the Mortgagor is the lessee under such ground lease and there is
a lien in favor of the mortgagee in such lease;
(k) Copies of any loan agreements, lock-box agreements and intercreditor
agreements (including, without limitation, any Intercreditor
Agreement, and a copy (that is, not the original) of the mortgage note
evidencing the related B Note), if any, related to any Mortgage Loan;
(l) Either (A) the original of each letter of credit, if any, constituting
additional collateral for such Mortgage Loan, which shall be assigned
and delivered to the Trustee on behalf of the Trust with a copy to be
held by the Primary Servicer (or the Master Servicer), and applied,
drawn, reduced or released in accordance with documents evidencing or
securing the applicable Mortgage Loan, the Pooling and Servicing
Agreement and the Primary
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Servicing Agreement or (B) the original of each letter of credit, if
any, constituting additional collateral for such Mortgage Loan, which
shall be held by the Primary Servicer (or the Master Servicer) on
behalf of the Trustee, with a copy to be held by the Trustee, and
applied, drawn, reduced or released in accordance with documents
evidencing or securing the applicable Mortgage Loan, the Pooling and
Servicing Agreement and the Primary Servicing Agreement (it being
understood that Seller has agreed (a) that the proceeds of such letter
of credit belong to the Trust, (b) to notify, on or before the Closing
Date, the bank issuing the letter of credit that the letter of credit
and the proceeds thereof belong to the Trust, and to use reasonable
efforts to obtain within 30 days (but in any event to obtain within 90
days) following the Closing Date, an acknowledgement thereof by the
bank (with a copy of such acknowledgement to be sent to the Trustee)
or a reissued letter of credit and (c) to indemnify the Trust for any
liabilities, charges, costs, fees or other expenses accruing from the
failure of Seller to assign all rights to the letter of credit
hereunder including the right and power to draw on the letter of
credit). In the case of clause (B) above, any letter of credit held by
the Primary Servicer (or Master Servicer) shall be held in its
capacity as agent of the Trust, and if the Primary Servicer (or Master
Servicer) sells its rights to service the applicable Mortgage Loan,
the Primary Servicer (or Master Servicer) has agreed to assign the
applicable letter of credit to the Trust or at the direction of the
Special Servicer to such party as the Special Servicer may instruct,
in each case, at the expense of the Primary Servicer (or Master
Servicer). The Primary Servicer (or Master Servicer) has agreed to
indemnify the Trust for any loss caused by the ineffectiveness of such
assignment;
(m) The original environmental indemnity agreement, if any, related to any
Mortgage Loan;
(n) Third-party management agreements for all hotels and for such other
Mortgaged Properties securing Mortgage Loans with a Cut-Off Date
principal balance equal to or greater than $20,000,000;
(o) Any Environmental Insurance Policy; and
(p) Any affidavit and indemnification agreement;
The original of each letter of credit referred to in clause 2.2.12 above shall
be delivered to the Primary Servicer, the Master Servicer or the Trustee (as the
case may be) within 45 days of the Closing Date. In addition, a copy of any
ground lease shall be delivered to the Primary Servicer within 30 days of the
Closing Date. Any failure to deliver any ground lease shall constitute a
document defect.
"Officer's Certificate" shall mean a certificate signed by one or more of the
Chairman of the Board, any Vice Chairman, the President, any Senior Vice
President, any Vice President, any Assistant Vice President, any Treasurer or
any Assistant Treasurer.
Section 2.03 The Assignments of Mortgage and assignment of Assignment of Leases
referred to in Sections 2.2.4 and 2.2.6 hereof may be in the form of a single
instrument assigning the Mortgage and the Assignment of Leases to the extent
permitted by applicable law. To avoid the unnecessary expense and administrative
inconvenience associated with the execution and
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recording or filing of multiple assignments of mortgages, assignments of leases
(to the extent separate from the mortgages) and assignments of UCC financing
statements, Seller shall execute, in accordance with Section 2.6 hereof, the
assignments of mortgages, the assignments of leases (to the extent separate from
the mortgages) and the assignments of UCC financing statements relating to the
Mortgage Loans naming the Trustee on behalf of the Certificateholders as
assignee. Notwithstanding the fact that such assignments of mortgages,
assignments of leases (to the extent separate from the assignments of mortgages)
and assignments of UCC financing statements shall name the Trustee on behalf of
the Certificateholders as the assignee, the parties hereto acknowledge and agree
that the Mortgage Loans shall for all purposes be deemed to have been
transferred from Seller to Purchaser and from Purchaser to the Trustee on behalf
of the Certificateholders.
Section 2.04 If Seller cannot deliver, or cause to be delivered, as to any
Mortgage Loan, any of the documents and/or instruments referred to in Sections
2.2.2, 2.2.3, 2.2.5 or 2.2.6 hereof, with evidence of recording thereon, solely
because of a delay caused by the public recording office where such document or
instrument has been delivered for recordation within such 45 day period, but
Seller delivers a photocopy thereof (certified by the appropriate county
recorder's office to be a true and complete copy of the original thereof
submitted for recording), to the Trustee within such 45 day period, Seller shall
then deliver within 90 days after the Closing Date the recorded document (or
within such longer period after the Closing Date as the Trustee may consent to,
which consent shall not be unreasonably withheld so long as Seller is, as
certified in writing to the Trustee no less often than monthly, in good faith
attempting to obtain from the appropriate county recorder's office such original
or photocopy).
Section 2.05 The Trustee, as assignee or transferee of Purchaser, shall be
entitled to all scheduled payments of principal due on the Mortgage Loans after
the Cut-Off Date, all other payments of principal collected after the Cut-Off
Date (other than scheduled payments of principal due on or before the Cut-Off
Date), and all payments of interest on the Mortgage Loans allocable to the
period commencing on the Cut-Off Date. All scheduled payments of principal and
interest due on or before the Cut-Off Date and collected after the Cut-Off Date
shall belong to Seller.
Section 2.06 Within 45 days following the Closing Date, Seller shall deliver and
Purchaser, the Trustee or the agents of either may submit or cause to be
submitted for recordation at the expense of Seller, in the appropriate public
office for real property records, each assignment referred to in clauses 2.2.4
and 2.2.6(ii) above. Within 90 days following the Closing Date, Seller shall
deliver and Purchaser, the Trustee or the agents of either may submit or cause
to be submitted for filing, at the expense of Seller, in the appropriate public
office for Uniform Commercial Code financing statements, the assignment referred
to in clause 2.2.1. If any such document or instrument is lost or returned
unrecorded or unfiled, as the case may be, because of a defect therein, Seller
shall prepare a substitute therefor or cure such defect, and Seller shall, at
its own expense (except in the case of a document or instrument that is lost by
the Trustee), record or file, as the case may be, and deliver such document or
instrument in accordance with this Section 2.
Section 2.07 Documents that are in the possession of Seller, its agents or its
subcontractors that relate to the Mortgage Loans and that are not required to be
delivered to the Trustee shall be
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shipped by Seller to or at the direction of the Master Servicer, on behalf of
Purchaser, on or prior to the 75th day after the Closing Date, in accordance
with Section 3.1 of the Primary Servicing Agreement, if applicable.
Section 2.08 The documents required to be delivered to the Master Servicer (or
in the alternative, the Primary Servicer) shall include, to the extent required
to be (and actually) delivered to Seller pursuant to the applicable Mortgage
Loan documents, copies of the following items: the Mortgage Note, any Mortgage,
the Assignment of Leases and the Assignment of Mortgage, any guaranty/indemnity
agreement, any loan agreement, the insurance policies or certificates, as
applicable, the property inspection reports, any financial statements on the
property, any escrow analysis, the tax bills, the Appraisal, the environmental
report, the engineering report, the asset summary, financial information on the
Borrower/sponsor and any guarantors, any letters of credit, any intercreditor
agreement and any Environmental Insurance Policies. Delivery of any of the
foregoing documents to the Primary Servicer shall be deemed a delivery to the
Master Servicer and satisfy Seller's obligations under this subparagraph.
Section 2.09 Upon the sale of the Mortgage Loans by Seller to Purchaser pursuant
to this Agreement, the ownership of each Mortgage Note, Mortgage and the other
contents of the related Mortgage File shall be vested in Purchaser and its
assigns, and the ownership of all records and documents with respect to the
related Mortgage Loan prepared by or that come into the possession of Seller
shall immediately vest in Purchaser and its assigns, and shall be delivered
promptly by Seller to or on behalf of either the Trustee or the Master Servicer
as set forth herein, subject to the requirements of the Primary Servicing
Agreement. Seller's and Purchaser's records shall reflect the transfer of each
Mortgage Loan from Seller to Purchaser and its assigns as a sale.
Section 2.10 It is the express intent of the parties hereto that the conveyance
of the Mortgage Loans and related property to Purchaser by Seller as provided in
this Section 2 be, and be construed as, an absolute sale of the Mortgage Loans
and related property. It is, further, not the intention of the parties that such
conveyance be deemed a pledge of the Mortgage Loans and related property by
Seller to Purchaser to secure a debt or other obligation of Seller. However, in
the event that, notwithstanding the intent of the parties, the Mortgage Loans or
any related property are held to be the property of Seller, or if for any other
reason this Agreement is held or deemed to create a security interest in the
Mortgage Loans or any related property, then:
(a) this Agreement shall be deemed to be a security agreement; and
(b) the conveyance provided for in this Section 2 shall be deemed to be a
grant by Seller to Purchaser of a security interest in all of Seller's
right, title, and interest, whether now owned or hereafter acquired,
in and to:
(i) All accounts, general intangibles, chattel paper, instruments,
documents, money, deposit accounts, certificates of deposit,
goods, letters of credit, advices of credit and investment
property consisting of, arising from or relating to any of the
following property: the Mortgage Loans identified on the
Mortgage Loan Schedule, including the related Mortgage Notes,
Mortgages, security agreements, and title, hazard and other
insurance policies, all distributions with respect thereto
payable after the Cut-Off Date,
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all substitute or replacement Mortgage Loans and all
distributions with respect thereto, and the Mortgage Files;
(ii) All accounts, general intangibles, chattel paper, instruments,
documents, money, deposit accounts, certificates of deposit,
goods, letters of credit, advices of credit, investment property
and other rights arising from or by virtue of the disposition
of, or collections with respect to, or insurance proceeds
payable with respect to, or claims against other Persons with
respect to, all or any part of the collateral described in
clause (A) above (including any accrued discount realized on
liquidation of any investment purchased at a discount); and
(iii) All cash and non-cash proceeds of the collateral described in
clauses (A) and (B) above.
Section 2.11 The possession by Purchaser or its designee of the Mortgage Notes,
the Mortgages, and such other goods, letters of credit, advices of credit,
instruments, money, documents, chattel paper or certificated securities shall be
deemed to be possession by the secured party or possession by a purchaser for
purposes of perfecting the security interest pursuant to the Uniform Commercial
Code (including, without limitation, Section 9-313 thereof) as in force in the
relevant jurisdiction. Notwithstanding the foregoing, Seller makes no
representation or warranty as to the perfection of any such security interest.
Section 2.12 Notifications to Persons holding such property, and
acknowledgments, receipts, or confirmations from persons holding such property,
shall be deemed to be notifications to, or acknowledgments, receipts or
confirmations from, securities intermediaries, bailees or agents of, or Persons
holding for, Purchaser or its designee, as applicable, for the purpose of
perfecting such security interest under applicable law.
Section 2.13 Seller shall, to the extent consistent with this Agreement,
take such reasonable actions as may be necessary to ensure that, if this
Agreement were deemed to create a security interest in the property described
above, such security interest would be deemed to be a perfected security
interest of first priority under applicable law and will be maintained as such
throughout the term of this Agreement. In such case, Seller shall file all
filings necessary to maintain the effectiveness of any original filings
necessary under the Uniform Commercial Code as in effect in any jurisdiction to
perfect such security interest in such property. In connection herewith,
Purchaser shall have all of the rights and remedies of a secured party and
creditor under the Uniform Commercial Code as in force in the relevant
jurisdiction.
Section 2.14 Notwithstanding anything to the contrary contained herein, and
subject to Section 2.1 hereof, Purchaser shall not be required to purchase any
Mortgage Loan as to which any Mortgage Note (endorsed as described in clause
2.2.1) required to be delivered to or on behalf of the Trustee or the Master
Servicer pursuant to this Section 2 on or before the Closing Date is not so
delivered, or is not properly executed or is defective on its face, and
Purchaser's acceptance of the related Mortgage Loan on the Closing Date shall in
no way constitute a waiver of such omission or defect or of Purchaser's or its
successors' and assigns' rights in respect thereof pursuant to Section 5 hereof.
Article III. EXAMINATION OF MORTGAGE FILES AND DUE DILIGENCE REVIEW.
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Section 3.01 Seller shall (i) deliver to Purchaser on or before the Closing Date
a diskette acceptable to Purchaser that contains such information about the
Mortgage Loans as may be reasonably requested by Purchaser, (ii) deliver to
Purchaser investor files (collectively the "Collateral Information") with
respect to the assets proposed to be included in the Mortgage Pool and made
available at Purchaser's headquarters in New York, and (iii) otherwise cooperate
fully with Purchaser in its examination of the credit files, underwriting
documentation and Mortgage Files for the Mortgage Loans and its due diligence
review of the Mortgage Loans. The fact that Purchaser has conducted or has
failed to conduct any partial or complete examination of the credit files,
underwriting documentation or Mortgage Files for the Mortgage Loans shall not
affect the right of Purchaser or the Trustee to cause Seller to cure any
Material Document Defect or Material Breach (each as defined below), or to
repurchase or replace the defective Mortgage Loans pursuant to Section 5 hereof.
Section 3.02 On or prior to the Closing Date, Seller shall allow representatives
of any of Purchaser, each Underwriter, each Initial Purchaser, the Trustee, the
Special Servicer and each Rating Agency to examine and audit all books, records
and files pertaining to the Mortgage Loans, Seller's underwriting procedures and
Seller's ability to perform or observe all of the terms, covenants and
conditions of this Agreement. Such examinations and audits shall take place at
one or more offices of Seller during normal business hours and shall not be
conducted in a manner that is disruptive to Seller's normal business operations
upon reasonable prior advance notice. In the course of such examinations and
audits, Seller will make available to such representatives of any of Purchaser,
each Underwriter, each Initial Purchaser, the Trustee, the Special Servicer and
each Rating Agency reasonably adequate facilities, as well as the assistance of
a sufficient number of knowledgeable and responsible individuals who are
familiar with the Mortgage Loans and the terms of this Agreement, and Seller
shall cooperate fully with any such examination and audit in all material
respects. On or prior to the Closing Date, Seller shall provide Purchaser with
all material information regarding Seller's financial condition and access to
knowledgeable financial or accounting officers for the purpose of answering
questions with respect to Seller's financial condition, financial statements as
provided to Purchaser or other developments affecting Seller's ability to
consummate the transactions contemplated hereby or otherwise affecting Seller in
any material respect. Within 45 days after the Closing Date, Seller shall
provide the Master Servicer or Primary Servicer, if applicable, with any
additional information identified by the Master Servicer or Primary Servicer, if
applicable, as necessary to complete the CMSA Property File, to the extent that
such information is available.
Section 3.03 Purchaser may exercise any of its rights hereunder through one or
more designees or agents, provided Purchaser has provided Seller with prior
notice of the identity of such designee or agent.
Section 3.04 Purchaser shall keep confidential any information regarding Seller
and the Mortgage Loans that has been delivered into Purchaser's possession and
that is not otherwise publicly available; provided, however, that such
information shall not be kept confidential (and the right to require
confidentiality under any confidentiality agreement is hereby waived) to the
extent such information is required to be included in the Memorandum or the
Prospectus Supplement or Purchaser is required by law or court order to disclose
such information. If Purchaser is required to disclose in the Memorandum or the
Prospectus Supplement confidential information regarding Seller as described in
the preceding sentence, Purchaser shall provide to
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Seller a copy of the proposed form of such disclosure prior to making such
disclosure and Seller shall promptly, and in any event within two Business Days,
notify Purchaser of any inaccuracies therein, in which case Purchaser shall
modify such form in a manner that corrects such inaccuracies. If Purchaser is
required by law or court order to disclose confidential information regarding
Seller as described in the second preceding sentence, Purchaser shall notify
Seller and cooperate in Seller's efforts to obtain a protective order or other
reasonable assurance that confidential treatment will be accorded such
information and, if in the absence of a protective order or such assurance,
Purchaser is compelled as a matter of law to disclose such information,
Purchaser shall, prior to making such disclosure, advise and consult with Seller
and its counsel as to such disclosure and the nature and wording of such
disclosure and Purchaser shall use reasonable efforts to obtain confidential
treatment therefor. Notwithstanding the foregoing, if reasonably advised by
counsel that Purchaser is required by a regulatory agency or court order to make
such disclosure immediately, then Purchaser shall be permitted to make such
disclosure without prior review by Seller.
Article IV. REPRESENTATIONS, WARRANTIES AND COVENANTS OF SELLER AND PURCHASER.
Section 4.01 To induce Purchaser to enter into this Agreement, Seller hereby
makes for the benefit of Purchaser and its assigns with respect to each Mortgage
Loan as of the date hereof (or as of such other date specifically set forth in
the particular representation and warranty) each of the representations and
warranties set forth on Exhibit 2 hereto, except as otherwise set forth on
Schedule A attached hereto, and hereby further represents, warrants and
covenants to Purchaser as of the date hereof that:
(a) Seller is duly organized and is validly existing as a corporation in
good standing under the laws of the State of New York. Seller has the
requisite power and authority and legal right to own the Mortgage
Loans and to transfer and convey the Mortgage Loans to Purchaser and
has the requisite power and authority to execute and deliver, engage
in the transactions contemplated by, and perform and observe the terms
and conditions of, this Agreement.
(b) This Agreement has been duly and validly authorized, executed and
delivered by Seller, and assuming the due authorization, execution and
delivery hereof by Purchaser, this Agreement constitutes the valid,
legal and binding agreement of Seller, enforceable in accordance with
its terms, except as such enforcement may be limited by (A) laws
relating to bankruptcy, insolvency, reorganization, receivership or
moratorium, (B) other laws relating to or affecting the rights of
creditors generally, (C) general equity principles (regardless of
whether such enforcement is considered in a proceeding in equity or at
law) or (D) public policy considerations underlying the securities
laws, to the extent that such public policy considerations limit the
enforceability of the provisions of this Agreement that purport to
provide indemnification from liabilities under applicable securities
laws.
(c) No consent, approval, authorization or order of, registration or
filing with, or notice to, any governmental authority or court is
required, under federal or state law, for the
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execution, delivery and performance of or compliance by Seller with
this Agreement, or the consummation by Seller of any transaction
contemplated hereby, other than (A) such qualifications as may be
required under state securities or blue sky laws, (B) the filing or
recording of financing statements, instruments of assignment and other
similar documents necessary in connection with Seller's sale of the
Mortgage Loans to Purchaser, (C) such consents, approvals,
authorizations, qualifications, registrations, filings or notices as
have been obtained and (D) where the lack of such consent, approval,
authorization, qualification, registration, filing or notice would not
have a material adverse effect on the performance by Seller under this
Agreement.
(d) Neither the transfer of the Mortgage Loans to Purchaser, nor the
execution, delivery or performance of this Agreement by Seller,
conflicts or will conflict with, results or will result in a breach
of, or constitutes or will constitute a default under (A) any term or
provision of Seller's articles of organization or by-laws, (B) any
term or provision of any material agreement, contract, instrument or
indenture to which Seller is a party or by which it or any of its
assets is bound or results in the creation or imposition of any lien,
charge or encumbrance upon any of its property pursuant to the terms
of any such indenture, mortgage, contract or other instrument, other
than pursuant to this Agreement, or (C) after giving effect to the
consents or taking of the actions contemplated in Section 4.1.3
hereof, any law, rule, regulation, order, judgment, writ, injunction
or decree of any court or governmental authority having jurisdiction
over Seller or its assets, except where in any of the instances
contemplated by clauses (B) or (C) above, any conflict, breach or
default, or creation or imposition of any lien, charge or encumbrance,
will not have a material adverse effect on the consummation of the
transactions contemplated hereby by Seller or its ability to perform
its obligations and duties hereunder or result in any material adverse
change in the business, operations, financial condition, properties or
assets of Seller, or in any material impairment of the right or
ability of Seller to carry on its business substantially as now
conducted.
(e) There are no actions or proceedings against, or investigations of,
Seller pending or, to Seller's knowledge, threatened in writing
against Seller before any court, administrative agency or other
tribunal, the outcome of which could reasonably be expected to
materially and adversely affect the transfer of the Mortgage Loans to
Purchaser or the execution or delivery by, or enforceability against,
Seller of this Agreement or have an effect on the financial condition
of Seller that would materially and adversely affect the ability of
Seller to perform its obligations under this Agreement.
(f) On the Closing Date, the sale of the Mortgage Loans pursuant to this
Agreement will effect a transfer by Seller of all of its right, title
and interest in and to the Mortgage Loans to Purchaser.
(g) To Seller's knowledge, Seller's Information (as defined in that
certain indemnification agreement, dated July 19, 2006, between
Seller, Purchaser, the Underwriters and the Initial Purchasers (the
"Indemnification Agreement")) does not contain any untrue statement of
a material fact or omit to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they
were made, not
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misleading. Notwithstanding anything contained herein to the contrary,
this subparagraph 4.1.7 shall run exclusively to the benefit of
Purchaser and no other party.
(h) The Seller has complied with the disclosure requirements of Regulation
AB that arise from its role as "originator" and "sponsor" in
connection with the issuance of the Public Certificates.
(i) For so long as the Trust is subject to the reporting requirements of
the Exchange Act, the Seller shall provide the Purchaser (or with
respect to any Serviced Companion Mortgage Loan that is deposited into
an Other Securitization, the depositor in such Other Securitization)
and the Paying Agent with any Additional Form 10-D Disclosure and any
Additional Form 10-K Disclosure set forth next to the Seller's name on
Schedule XV and Schedule XVI of the Pooling and Servicing Agreement
within the time periods and in accordance with the provisions set
forth in the Pooling and Servicing Agreement.
To induce Purchaser to enter into this Agreement, Seller hereby covenants that
the foregoing representations and warranties and those set forth on Exhibit 2
hereto, subject to the exceptions set forth in Schedule A to Exhibit 2, will be
true and correct in all material respects on and as of the Closing Date with the
same effect as if made on the Closing Date.
Each of the representations, warranties and covenants made by Seller pursuant to
this Section 4.1 shall survive the sale of the Mortgage Loans and shall continue
in full force and effect notwithstanding any restrictive or qualified
endorsement on the Mortgage Notes.
Section 4.02 To induce Seller to enter into this Agreement, Purchaser hereby
represents and warrants to Seller as of the date hereof:
(a) Purchaser is a corporation duly organized, validly existing, and in
good standing under the laws of the State of Delaware with full power
and authority to carry on its business as presently conducted by it.
(b) Purchaser has full power and authority to acquire the Mortgage Loans,
to execute and deliver this Agreement and to enter into and consummate
all transactions contemplated by this Agreement. Purchaser has duly
and validly authorized the execution, delivery and performance of this
Agreement and has duly and validly executed and delivered this
Agreement. This Agreement, assuming due authorization, execution and
delivery by Seller, constitutes the valid and binding obligation of
Purchaser, enforceable against it in accordance with its terms, except
as such enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium and other similar laws affecting the
enforcement of creditors' rights generally and by general principles
of equity, regardless of whether such enforcement is considered in a
proceeding in equity or at law.
(c) No consent, approval, authorization or order of, registration or
filing with, or notice to, any governmental authority or court is
required, under federal or state law, for the execution, delivery and
performance of or compliance by Purchaser with this Agreement, or the
consummation by Purchaser of any transaction contemplated hereby that
has not been obtained or made by Purchaser.
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(d) Neither the purchase of the Mortgage Loans nor the execution, delivery
and performance of this Agreement by Purchaser will violate
Purchaser's certificate of incorporation or by-laws or constitute a
default (or an event that, with notice or lapse of time or both, would
constitute a default) under, or result in a breach of, any material
agreement, contract, instrument or indenture to which Purchaser is a
party or that may be applicable to Purchaser or its assets.
(e) Purchaser's execution and delivery of this Agreement and its
performance and compliance with the terms of this Agreement will not
constitute a violation of any law, rule, writ, injunction, order or
decree of any court, or order or regulation of any federal, state or
municipal government agency having jurisdiction over Purchaser or its
assets, which violation could materially and adversely affect the
condition (financial or otherwise) or the operation of Purchaser or
its assets or could materially and adversely affect its ability to
perform its obligations and duties hereunder.
(f) There are no actions or proceedings against, or investigations of,
Purchaser pending or, to Purchaser's knowledge, threatened against
Purchaser before any court, administrative agency or other tribunal,
the outcome of which could reasonably be expected to adversely affect
the transfer of the Mortgage Loans, the issuance of the Certificates,
the execution, delivery or enforceability of this Agreement or have an
effect on the financial condition of Purchaser that would materially
and adversely affect the ability of Purchaser to perform its
obligation under this Agreement.
(g) Purchaser has not dealt with any broker, investment banker, agent or
other person, other than Seller, the Underwriters, the Initial
Purchasers and their respective affiliates, that may be entitled to
any commission or compensation in connection with the sale of the
Mortgage Loans or consummation of any of the transactions contemplated
hereby.
To induce Seller to enter into this Agreement, Purchaser hereby covenants that
the foregoing representations and warranties will be true and correct in all
material respects on and as of the Closing Date with the same effect as if made
on the Closing Date.
Each of the representations and warranties made by Purchaser pursuant to this
Section 4.2 shall survive the purchase of the Mortgage Loans.
Article V. REMEDIES UPON BREACH OF REPRESENTATIONS AND WARRANTIES MADE BY
SELLER.
Section 5.01 It is hereby acknowledged that Seller shall make for the benefit of
the Trustee on behalf of the holders of the Certificates, whether directly or by
way of Purchaser's assignment of its rights hereunder to the Trustee, the
representations and warranties set forth on Exhibit 2 hereto (each as of the
date hereof unless otherwise specified).
Section 5.02 It is hereby further acknowledged that if any document required to
be delivered to the Trustee pursuant to Section 2 hereof is not delivered as and
when required, not properly executed or is defective on its face, or if there is
a breach of any of the representations and warranties required to be made by
Seller regarding the characteristics of the Mortgage Loans
15
and/or the related Mortgaged Properties as set forth in Exhibit 2 hereto, and in
either case the party discovering such breach or defect determines that either
(i) the defect or breach materially and adversely affects the interests of the
holders of the Certificates in the related Mortgage Loan or (ii) both (A) the
defect or breach materially and adversely affects the value of the Mortgage Loan
and (B) the Mortgage Loan is a Specially Serviced Mortgage Loan or Rehabilitated
Mortgage Loan (any such defect described in the preceding clause (i) or (ii), a
"Material Document Defect" and any such breach described in the preceding clause
(i) or (ii), a "Material Breach"), the party determining that such Material
Document Defect or Material Breach exists shall promptly notify, in writing, the
other parties; provided that any breach of the representation and warranty
contained in paragraph (41) of such Exhibit 2 shall constitute a Material Breach
only if such prepayment premium or yield maintenance charge is not deemed
"customary" for commercial mortgage loans as evidenced by (i) an opinion of tax
counsel to such effect or (ii) a determination by the Internal Revenue Service
that such provision is not customary. Promptly (but in any event within three
Business Days) upon determining (or becoming aware of another party's
determination) that any such Material Document Defect or Material Breach exists
(which determination shall, absent evidence to the contrary, be presumed to be
no earlier than three Business Days prior to delivery of the notice to Seller
referred to below), the Master Servicer shall, and the Special Servicer may,
request that Seller, not later than 90 days from Seller's receipt of the notice
of such Material Document Defect or Material Breach, cure such Material Document
Defect or Material Breach, as the case may be, in all material respects;
provided, however, that if such Material Document Defect or Material Breach, as
the case may be, cannot be corrected or cured in all material respects within
such 90 day period, and such Material Document Defect or Material Breach would
not cause the Mortgage Loan to be other than a "qualified mortgage"(as defined
in the Code) but Seller is diligently attempting to effect such correction or
cure, as certified by Seller in an Officer's Certificate delivered to the
Trustee, then the cure period will be extended for an additional 90 days unless,
solely in the case of a Material Document Defect, (x) the Mortgage Loan is then
a Specially Serviced Mortgage Loan and a Servicing Transfer Event has occurred
as a result of a monetary default or as described in clause (ii) or clause (v)
of the definition of "Servicing Transfer Event" in the Pooling and Servicing
Agreement and (y) the Material Document Defect was identified in a certification
delivered to Seller by the Trustee pursuant to Section 2.2 of the Pooling and
Servicing Agreement not less than 90 days prior to the delivery of the notice of
such Material Document Defect. The parties acknowledge that neither delivery of
a certification or schedule of exceptions to Seller pursuant to Section 2.2 of
the Pooling and Servicing Agreement or otherwise nor possession of such
certification or schedule by Seller shall, in and of itself, constitute delivery
of notice of any Material Document Defect or knowledge or awareness by Seller,
the Master Servicer or the Special Servicer of any Material Document Defect
listed therein.
Section 5.03 Seller hereby covenants and agrees that, if any such Material
Document Defect or Material Breach cannot be corrected or cured or Seller
otherwise fails to correct or cure within the above cure periods, Seller shall,
on or before the termination of such cure periods, either (i) repurchase the
affected Mortgage Loan or REO Mortgage Loan (or interest therein) from Purchaser
or its assignee at the Purchase Price as defined in the Pooling and Servicing
Agreement, or (ii) if within the three-month period commencing on the Closing
Date (or within the two-year period commencing on the Closing Date if the
related Mortgage Loan is a "defective obligation" within the meaning of Section
860G(a)(4)(B)(ii) of the Code and Treasury Regulation Section 1.860G-2(f)), at
its option replace, without recourse, any Mortgage Loan or
16
REO Mortgage Loan to which such defect relates with a Qualifying Substitute
Mortgage Loan. If such Material Document Defect or Material Breach would cause
the Mortgage Loan to be other than a "qualified mortgage" (as defined in the
Code), then notwithstanding the previous sentence or the previous paragraph,
repurchase must occur within 85 days from the date Seller was notified of the
defect. Seller agrees that any substitution shall be completed in accordance
with the terms and conditions of the Pooling and Servicing Agreement.
Section 5.04 If (x) a Mortgage Loan is to be repurchased or replaced as
contemplated above (a "Defective Mortgage Loan"), (y) such Defective Mortgage
Loan is cross-collateralized and cross-defaulted with one or more other Mortgage
Loans ("Crossed Mortgage Loans") and (z) the applicable document defect or
breach does not constitute a Material Document Defect or Material Breach, as the
case may be, as to such Crossed Mortgage Loans (without regard to this
paragraph), then the applicable document defect or breach (as the case may be)
shall be deemed to constitute a Material Document Defect or Material Breach, as
the case may be, as to each such Crossed Mortgage Loan for purposes of the above
provisions, and Seller shall be obligated to repurchase or replace each such
Crossed Mortgage Loan in accordance with the provisions above, unless, in the
case of such breach or document defect, (A) Seller provides a
Nondisqualification Opinion to the Trustee at the expense of Seller if, in the
reasonable business judgment of the Trustee, it would be usual and customary in
accordance with industry practice to obtain a Nondisqualification Opinion and
(B) both of the following conditions would be satisfied if Seller were to
repurchase or replace only those Mortgage Loans as to which a Material Breach or
Material Document Defect had occurred without regard to this paragraph (the
"Affected Loan(s)"): (i) the debt service coverage ratio for all such Crossed
Mortgage Loans (excluding the Affected Loan(s)) for the four calendar quarters
immediately preceding the repurchase or replacement is not less than the lesser
of (A) 0.10x below the debt service coverage ratio for all such Crossed Mortgage
Loans (including the Affected Loans(s)) set forth in Appendix II to the Final
Prospectus Supplement and (B) the debt service coverage ratio for all such
Crossed Mortgage Loans (including the Affected Loan(s)) for the four preceding
calendar quarters preceding the repurchase or replacement, and (ii) the
loan-to-value ratio for all such Crossed Mortgage Loans (excluding the Affected
Loan(s)) is not greater than the greater of (A) the loan-to-value ratio,
expressed as a whole number (taken to one decimal place), for all such Crossed
Mortgage Loans (including the Affected Loan(s)) set forth in Appendix II to the
Final Prospectus Supplement plus 10% and (B) the loan-to-value ratio for all
such Crossed Mortgage Loans (including the Affected Loans(s)), at the time of
repurchase or replacement. The determination of the Master Servicer as to
whether the conditions set forth above have been satisfied shall be conclusive
and binding in the absence of manifest error. The Master Servicer will be
entitled to cause to be delivered, or direct Seller to (in which case Seller
shall) cause to be delivered to the Master Servicer, an Appraisal of any or all
of the related Mortgaged Properties for purposes of determining whether the
condition set forth in clause (ii) above has been satisfied, in each case at the
expense of Seller if the scope and cost of the Appraisal is approved by Seller
(such approval not to be unreasonably withheld).
Section 5.05 With respect to any Defective Mortgage Loan, to the extent that
Seller is required to repurchase or substitute for such Defective Mortgage Loan
(each, a "Repurchased Loan") in the manner prescribed above while the Trustee
(as assignee of Purchaser) continues to hold any Crossed Mortgage Loan, Seller
and Purchaser hereby agree to forebear from enforcing any remedies against the
other's Primary Collateral but may exercise remedies against the Primary
17
Collateral securing their respective Mortgage Loans, including with respect to
the Trustee, the Primary Collateral securing the Mortgage Loans still held by
the Trustee, so long as such exercise does not impair the ability of the other
party to exercise its remedies against its Primary Collateral. If the exercise
of remedies by one party would impair the ability of the other party to exercise
its remedies with respect to the Primary Collateral securing the Mortgage Loan
or Mortgage Loans held by such party, then both parties shall forbear from
exercising such remedies until the loan documents evidencing and securing the
relevant Mortgage Loans can be modified in a manner that complies with the
Pooling and Servicing Agreement to remove the threat of impairment as a result
of the exercise of remedies. Any reserve or other cash collateral or letters of
credit securing the Crossed Mortgage Loans shall be allocated between such
Mortgage Loans in accordance with the Mortgage Loan documents, or otherwise on a
pro rata basis based upon their outstanding Principal Balances. All other terms
of the Mortgage Loans shall remain in full force and effect, without any
modification thereof. The Mortgagors set forth on Schedule B hereto are intended
third-party beneficiaries of the provisions set forth in this paragraph and the
preceding paragraph. The provisions of this paragraph and the preceding
paragraph may not be modified with respect to any Mortgage Loan without the
related Mortgagor's consent.
Section 5.06 Any of the following document defects shall be conclusively
presumed materially and adversely to affect the interests of Certificateholders
in a Mortgage Loan and be a Material Document Defect: (a) the absence from the
Mortgage File of the original signed Mortgage Note, unless the Mortgage File
contains a signed lost note affidavit and indemnity that appears to be regular
on its face; (b) the absence from the Mortgage File of the original signed
Mortgage that appears to be regular on its face, unless there is included in the
Mortgage File a certified copy of the Mortgage by the local authority with which
the Mortgage was recorded; or (c) the absence from the Mortgage File of the item
specified in paragraph 2.2.8. If any of the foregoing Material Document Defects
is discovered by the Custodian (or the Trustee if there is no Custodian), the
Trustee (or as set forth in Section 2.3(a) of the Pooling and Servicing
Agreement, the Master Servicer) will take the steps described elsewhere in this
Section, including the giving of notices to the Rating Agencies and the parties
hereto and making demand upon Seller for the cure of the Material Document
Defect or repurchase or replacement of the related Mortgage Loan.
Section 5.07 If Seller disputes that a Material Document Defect or Material
Breach exists with respect to a Mortgage Loan or otherwise refuses (i) to effect
a correction or cure of such Material Document Defect or Material Breach, (ii)
to repurchase the affected Mortgage Loan from Purchaser or its assignee or (iii)
to replace such Mortgage Loan with a Qualifying Substitute Mortgage Loan, each
in accordance with this Agreement, then provided that (x) the period of time
provided for Seller to correct, repurchase or cure has expired and (y) the
Mortgage Loan is then in default and is then a Specially Serviced Mortgage Loan,
the Special Servicer may, subject to the Servicing Standard, modify, work-out or
foreclose, sell or otherwise liquidate (or permit the liquidation of) the
Mortgage Loan pursuant to Sections 9.5, 9.12, 9.15 and 9.36, as applicable, of
the Pooling and Servicing Agreement, while pursuing the repurchase claim. Seller
acknowledges and agrees that any modification of the Mortgage Loan pursuant to a
work-out shall not constitute a defense to any repurchase claim nor shall such
modification and work-out change the Purchase Price due from Seller for any
repurchase claim. In the event of any such modification and work-out, Seller
shall be obligated to repurchase the Mortgage Loan as modified and the Purchase
Price shall include any Work-Out Fee paid to the Special Servicer up
18
to the date of repurchase plus the present value (calculated at a discount rate
equal to the applicable Mortgage Rate) of the Work-Out Fee that would have been
payable to the Special Servicer in respect of such Mortgage Loan if the Mortgage
Loan performed in accordance with its terms to its Maturity Date, provided that
no amount shall be paid by Seller in respect of any Work-Out Fee if a
Liquidation Fee already comprises a portion of the Purchase Price.
Section 5.08 Seller shall have the right to purchase certain of the Mortgage
Loans or REO Properties, as applicable, in accordance with Section 9.36 of the
Pooling and Servicing Agreement.
Section 5.09 The fact that a Material Document Defect or Material Breach is not
discovered until after foreclosure (but in all instances prior to the sale of
the related REO Property or Mortgage Loan) shall not prejudice any claim against
Seller for repurchase of the REO Mortgage Loan or REO Property. In such an
event, the Master Servicer shall notify Seller of the discovery of the Material
Document Defect or Material Breach and Seller shall have 90 days to correct or
cure such Material Document Defect or Material Breach or purchase the REO
Property (or interest therein) at the Purchase Price. After a final liquidation
of the Mortgage Loan or REO Mortgage Loan, if a court of competent jurisdiction
issues a final order after the expiration of any applicable appeal period that
Seller is or was obligated to repurchase the related Mortgage Loan or REO
Mortgage Loan (or interest therein) (a "Final Judicial Determination") or Seller
otherwise accepts liability, then, but in no event later than the Termination of
the Trust pursuant to Section 9.30 of the Pooling and Servicing Agreement,
Seller will be obligated to pay to the Trust the difference between any
Liquidation Proceeds received upon such liquidation in accordance with the
Pooling and Servicing Agreement (including those arising from any sale to
Seller) and the Purchase Price.
Section 5.10 Notwithstanding anything to the contrary contained herein, in
connection with any sale or other liquidation of a Mortgage Loan or REO Property
as described in this Section 5, the Special Servicer shall not receive a
Liquidation Fee from Seller (but may collect such Liquidation Fee from the
related Liquidation Proceeds as otherwise provided herein); provided, however,
that in the event Seller is obligated to repurchase the Mortgage Loan or REO
Mortgaged Property (or interest therein) after a final liquidation of such
Mortgage Loan or REO Property pursuant to the immediately preceding paragraph,
an amount equal to any Liquidation Fee (calculated on the basis of Liquidation
Proceeds) payable to the Special Servicer shall be included in the definition of
"Purchase Price" in respect of such Mortgage Loan or REO Mortgaged Property.
Except as expressly set forth above, no Liquidation Fee shall be payable in
connection with a repurchase of a Mortgage Loan by Seller.
Section 5.11 The obligations of Seller set forth in this Section 5 to cure a
Material Document Defect or a Material Breach or repurchase or replace a
defective Mortgage Loan constitute the sole remedies of Purchaser or its
assignees with respect to a Material Document Defect or Material Breach in
respect of an outstanding Mortgage Loan; provided, that this limitation shall
not in any way limit Purchaser's rights or remedies upon breach of any other
representation or warranty or covenant by Seller set forth in this Agreement
(other than those set forth in Exhibit 2).
19
Section 5.12 Notwithstanding the foregoing, in the event that there is a breach
of the representations and warranties set forth in paragraph 39 in Exhibit 2
hereto, and as a result the payments, by a Mortgagor, of reasonable costs and
expenses associated with the defeasance or assumption of a Mortgage Loan are
insufficient causing the Trust to incur an Additional Trust Expense in an amount
equal to such reasonable costs and expenses not paid by such Mortgagor, Seller
hereby covenants and agrees to reimburse the Trust within 90 days of the receipt
of notice of such breach in an amount sufficient to avoid such Additional Trust
Expense. The parties hereto acknowledge that such reimbursement shall be
Seller's sole obligation with respect to the breach discussed in the previous
sentence.
Section 5.13 The Pooling and Servicing Agreement shall provide that the Trustee
(or the Master Servicer or the Special Servicer on its behalf) shall give
written notice promptly (but in any event within three Business Days) to Seller
of its determination that any Material Document Defect or Material Breach exists
(which determination shall, absent evidence to the contrary, be presumed to be
no earlier than three Business Days prior to delivery of the notice) and prompt
written notice to Seller in the event that any Mortgage Loan becomes a Specially
Serviced Mortgage Loan (as defined in the Pooling and Servicing Agreement).
Section 5.14 If Seller repurchases any Mortgage Loan pursuant to this Section 5,
Purchaser or its assignee, following receipt by the Trustee of the Purchase
Price therefor, promptly shall deliver or cause to be delivered to Seller all
Mortgage Loan documents with respect to such Mortgage Loan, and each document
that constitutes a part of the Mortgage File that was endorsed or assigned to
the Trustee shall be endorsed and assigned to Seller in the same manner such
that Seller shall be vested with legal and beneficial title to such Mortgage
Loan, in each case without recourse, including any property acquired in respect
of such Mortgage Loan or proceeds of any insurance policies with respect
thereto.
Article VI. CLOSING.
Section 6.01 The closing of the sale of the Mortgage Loans shall be held at the
offices of Xxxxxx & Xxxxxxx LLP, 000 Xxxxx Xxxxxx, Xxx Xxxx, XX 00000 at 9:00
a.m., New York time, on the Closing Date. The closing shall be subject to each
of the following conditions:
(a) All of the representations and warranties of Seller and Purchaser
specified in Section 4 hereof (including, without limitation, the
representations and warranties set forth on Exhibit 2 hereto) shall be
true and correct as of the Closing Date (to the extent of the
standard, if any, set forth in each representation and warranty).
(b) All Closing Documents specified in Section 7 hereof, in such forms as
are agreed upon and reasonably acceptable to Seller or Purchaser, as
applicable, shall be duly executed and delivered by all signatories as
required pursuant to the respective terms thereof.
(c) Seller shall have delivered and released to Purchaser or its designee
all documents required to be delivered to Purchaser as of the Closing
Date pursuant to Section 2 hereof.
(d) The result of the examination and audit performed by Purchaser and its
affiliates pursuant to Section 3 hereof shall be satisfactory to
Purchaser and its affiliates in their sole
20
determination and the parties shall have agreed to the form and
contents of Seller's Information to be disclosed in the Memorandum and
the Prospectus Supplement.
(e) All other terms and conditions of this Agreement required to be
complied with on or before the Closing Date shall have been complied
with, and Seller and Purchaser shall have the ability to comply with
all terms and conditions and perform all duties and obligations
required to be complied with or performed after the Closing Date.
(f) Seller shall have paid all fees and expenses payable by it to
Purchaser pursuant to Section 8 hereof.
(g) The Certificates to be so rated shall have been assigned ratings by
each Rating Agency no lower than the ratings specified for each such
Class in the Memorandum and the Prospectus Supplement.
(h) No Underwriter shall have terminated the Underwriting Agreement and
none of the Initial Purchasers shall have terminated the Certificate
Purchase Agreement, and neither the Underwriters nor the Initial
Purchasers shall have suspended, delayed or otherwise cancelled the
Closing Date.
(i) Seller shall have received the purchase price for the Mortgage Loans
pursuant to Section 1 hereof.
Section 6.02 Each party agrees to use its best efforts to perform its respective
obligations hereunder in a manner that will enable Purchaser to purchase the
Mortgage Loans on the Closing Date.
Article VII. CLOSING DOCUMENTS. The Closing Documents shall consist of the
following:
Section 7.01 This Agreement duly executed by Purchaser and Seller.
Section 7.02 A certificate of Seller, executed by a duly authorized officer of
Seller and dated the Closing Date, and upon which Purchaser and its successors
and assigns may rely, to the effect that: (i) the representations and warranties
of Seller in this Agreement are true and correct in all material respects on and
as of the Closing Date with the same force and effect as if made on the Closing
Date, provided that any representations and warranties made as of a specified
date shall be true and correct as of such specified date; and (ii) Seller has
complied with all agreements and satisfied all conditions on its part to be
performed or satisfied on or prior to the Closing Date.
Section 7.03 True, complete and correct copies of Seller's articles of
organization and by-laws.
Section 7.04 A certificate of existence for Seller from the Secretary of State
of New York dated not earlier than 30 days prior to the Closing Date.
21
Section 7.05 A certificate of the Secretary or Assistant Secretary of Seller,
dated the Closing Date, and upon which Purchaser may rely, to the effect that
each individual who, as an officer or representative of Seller, signed this
Agreement or any other document or certificate delivered on or before the
Closing Date in connection with the transactions contemplated herein, was at the
respective times of such signing and delivery, and is as of the Closing Date,
duly elected or appointed, qualified and acting as such officer or
representative, and the signatures of such persons appearing on such documents
and certificates are their genuine signatures.
Section 7.06 An opinion of counsel (which, other than as to the opinion
described in paragraph 7.6.6 below, may be in-house counsel) to Seller, dated
the Closing Date, substantially to the effect of the following (with such
changes and modifications as Purchaser may approve and subject to such counsel's
reasonable qualifications):
(a) Seller is validly existing under New York law and has full corporate
power and authority to enter into and perform its obligations under
this Agreement.
(b) This Agreement has been duly authorized, executed and delivered by
Seller.
(c) No consent, approval, authorization or order of any federal court or
governmental agency or body is required for the consummation by Seller
of the transactions contemplated by the terms of this Agreement except
any approvals as have been obtained.
(d) Neither the execution, delivery or performance of this Agreement by
Seller, nor the consummation by Seller of any of the transactions
contemplated by the terms of this Agreement (A) conflicts with or
results in a breach or violation of, or constitutes a default under,
the organizational documents of Seller, (B) to the knowledge of such
counsel, constitutes a default under any term or provision of any
material agreement, contract, instrument or indenture, to which Seller
is a party or by which it or any of its assets is bound or results in
the creation or imposition of any lien, charge or encumbrance upon any
of its property pursuant to the terms of any such indenture, mortgage,
contract or other instrument, other than pursuant to this Agreement,
or (C) conflicts with or results in a breach or violation of any law,
rule, regulation, order, judgment, writ, injunction or decree of any
court or governmental authority having jurisdiction over Seller or its
assets, except where in any of the instances contemplated by clauses
(B) or (C) above, any conflict, breach or default, or creation or
imposition of any lien, charge or encumbrance, will not have a
material adverse effect on the consummation of the transactions
contemplated hereby by Seller or materially and adversely affect its
ability to perform its obligations and duties hereunder or result in
any material adverse change in the business, operations, financial
condition, properties or assets of Seller, or in any material
impairment of the right or ability of Seller to carry on its business
substantially as now conducted.
(e) To his or her knowledge, there are no legal or governmental actions,
investigations or proceedings pending to which Seller is a party, or
threatened against Seller, (a) asserting the invalidity of this
Agreement or (b) which materially and adversely affect the performance
by Seller of its obligations under, or the validity or enforceability
of, this Agreement.
22
(f) This Agreement is a valid, legal and binding agreement of Seller,
enforceable against Seller in accordance with its terms, except as
such enforcement may be limited by (1) laws relating to bankruptcy,
insolvency, reorganization, receivership or moratorium, (2) other laws
relating to or affecting the rights of creditors generally, (3)
general equity principles (regardless of whether such enforcement is
considered in a proceeding in equity or at law) or (4) public policy
considerations underlying the securities laws, to the extent that such
public policy considerations limit the enforceability of the
provisions of this Agreement that purport to provide indemnification
from liabilities under applicable securities laws.
Such opinion may express its reliance as to factual matters on, among other
things specified in such opinion, the representations and warranties made by,
and on certificates or other documents furnished by officers of, the parties to
this Agreement.
In rendering the opinions expressed above, such counsel may limit such opinions
to matters governed by the federal laws of the United States and the corporate
laws of the State of Delaware and the State of New York, as applicable.
Section 7.07 Such other opinions of counsel as any Rating Agency may request in
connection with the sale of the Mortgage Loans by Seller to Purchaser or
Seller's execution and delivery of, or performance under, this Agreement.
Section 7.08 A "10b-5" opinion of counsel addressed to the Purchaser and the
Underwriters, in form reasonably acceptable to Purchaser and the Underwriters,
as to the disclosure provided by Seller to Purchaser in connection with the
Certificates.
Section 7.09 An opinion of counsel addressed to Purchaser and the Underwriters,
in form reasonably acceptable to Purchaser and the Underwriters, that such
disclosure complies as to form with the applicable requirements of Regulation AB
with respect to Seller's role as Sponsor (as defined in Regulation AB) in
connection with the Certificates.
Section 7.10 A letter from Deloitte & Touche, certified public accountants,
dated the date hereof, to the effect that they have performed certain specified
procedures as a result of which they determined that certain information of an
accounting, financial or statistical nature set forth in the Memorandum and the
Prospectus Supplement agrees with the records of Seller.
Section 7.11 Such further certificates, opinions and documents as Purchaser may
reasonably request.
Section 7.12 An officer's certificate of Purchaser, dated as of the Closing
Date, with the resolutions of Purchaser authorizing the transactions described
herein attached thereto, together with certified copies of the charter, by-laws
and certificate of good standing of Purchaser dated not earlier than 30 days
prior to the Closing Date.
Section 7.13 Such other certificates of Purchaser's officers or others and such
other documents to evidence fulfillment of the conditions set forth in this
Agreement as Seller or its counsel may reasonably request.
23
Section 7.14 An executed Xxxx of Sale in the form attached hereto as Exhibit 4.
Article VIII. COSTS. Seller shall pay Purchaser the costs and expenses as agreed
upon by Seller and Purchaser in a separate Letter of Understanding entered into
in connection with this Agreement and the issuance of the Certificates.
Article IX. NOTICES. All communications provided for or permitted hereunder
shall be in writing and shall be deemed to have been duly given if (a)
personally delivered, (b) mailed by registered or certified mail, postage
prepaid and received by the addressee, (c) sent by express courier delivery
service and received by the addressee, or (d) transmitted by telex or facsimile
transmission (or any other type of electronic transmission agreed upon by the
parties) and confirmed by a writing delivered by any of the means described in
(a), (b) or (c), if (i) to Purchaser, addressed to Xxxxxx Xxxxxxx Capital I
Inc., 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxx Friend, with a
copy to Xxxxxx Xxxxxxx Capital I Inc., 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Legal Department, Attention: Xxxxx X. Xxx, Esq. (or such other address as may
hereafter be furnished in writing by Purchaser), or if (ii) to Seller, addressed
to Seller at Bear Xxxxxxx Commercial Mortgage, Inc., addressed to Bear Xxxxxxx
Commercial Mortgage, Inc., 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: J. Xxxxxxxxxxx Xxxxxxx, Senior Managing Director, Commercial Mortgage
Department (with a copy to the attention of Xxxxxx X. Xxxxxxxxx, Xx., Managing
Director, Legal Department) (or such other address as may hereafter be furnished
in writing by Seller).
Article X. SEVERABILITY OF PROVISIONS. Any part, provision, representation,
warranty or covenant of this Agreement that is prohibited or that is held to be
void or unenforceable shall be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof. Any part,
provision, representation, warranty or covenant of this Agreement that is
prohibited or unenforceable or is held to be void or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction. To the extent permitted by applicable law, the parties
hereto waive any provision of law that prohibits or renders void or
unenforceable any provision hereof.
Article XI. FURTHER ASSURANCES. Seller and Purchaser each agree to execute and
deliver such instruments and take such actions as the other may, from time to
time, reasonably request in order to effectuate the purpose and to carry out the
terms of this Agreement and the Pooling and Servicing Agreement.
Article XII. SURVIVAL. Each party hereto agrees that the representations,
warranties and agreements made by it herein and in any certificate or other
instrument delivered pursuant hereto shall be deemed to be relied upon by the
other party, notwithstanding any investigation heretofore or hereafter made by
the other party or on its behalf, and that the representations,
24
warranties and agreements made by such other party herein or in any such
certificate or other instrument shall survive the delivery of and payment for
the Mortgage Loans and shall continue in full force and effect, notwithstanding
any restrictive or qualified endorsement on the Mortgage Notes and
notwithstanding subsequent termination of this Agreement.
Article XIII. GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS, DUTIES, OBLIGATIONS
AND RESPONSIBILITIES OF THE PARTIES HERETO SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS AND DECISIONS OF THE STATE OF NEW YORK. THE
PARTIES HERETO INTEND THAT THE PROVISIONS OF SECTION 5-1401 OF THE NEW YORK
GENERAL OBLIGATIONS LAW SHALL APPLY TO THIS AGREEMENT.
Article XIV. BENEFITS OF MORTGAGE LOAN PURCHASE AGREEMENT. This Agreement shall
inure to the benefit of and shall be binding upon Seller, Purchaser and their
respective successors, legal representatives, and permitted assigns, and nothing
expressed or mentioned in this Agreement is intended or shall be construed to
give any other person any legal or equitable right, remedy or claim under or in
respect of this Agreement, or any provisions herein contained, this Agreement
and all conditions and provisions hereof being intended to be and being for the
sole and exclusive benefit of such persons and for the benefit of no other
person except that the rights and obligations of Purchaser pursuant to Sections
2, 4.1 (other than clause 4.1.7), 5, 9, 10, 11, 12 and 13 hereof may be assigned
to the Trustee as may be required to effect the purposes of the Pooling and
Servicing Agreement and, upon such assignment, the Trustee shall succeed to the
rights and obligations hereunder of Purchaser. No owner of a Certificate issued
pursuant to the Pooling and Servicing Agreement shall be deemed a successor or
permitted assigns because of such ownership.
Article XV. MISCELLANEOUS. This Agreement may be executed in two or more
counterparts, each of which when so executed and delivered shall be an original,
but all of which together shall constitute one and the same instrument. Neither
this Agreement nor any term hereof may be changed, waived, discharged or
terminated orally, but only by an instrument in writing signed by the party
against whom enforcement of the change, waiver, discharge or termination is
sought. The headings in this Agreement are for purposes of reference only and
shall not limit or otherwise affect the meaning hereof. The rights and
obligations of Seller under this Agreement shall not be assigned by Seller
without the prior written consent of Purchaser, except that any person into
which Seller may be merged or consolidated, or any corporation resulting from
any merger, conversion or consolidation to which Seller is a party, or any
person succeeding to the entire business of Seller shall be the successor to
Seller hereunder.
Article XVI. ENTIRE AGREEMENT. This Agreement contains the entire agreement and
understanding between the parties hereto with respect to the subject matter
hereof (other than the Letter of Understanding (solely with respect to those
portions of this Agreement that are not assigned to the Trustee), the
Indemnification Agreement and the Pooling and Servicing Agreement), and
supersedes all prior and contemporaneous agreements, understandings, inducements
and conditions, express or implied, oral or written, of any nature whatsoever
with
25
respect to the subject matter hereof. The express terms hereof control and
supersede any course of performance or usage of the trade inconsistent with any
of the terms hereof.
26
IN WITNESS WHEREOF, Purchaser and Seller have caused this Agreement to be
executed by their respective duly authorized officers as of the date first above
written.
BEAR XXXXXXX COMMERCIAL MORTGAGE, INC.
By: /s/ Xxxxxxx X. Xxxxxx Xx.
------------------------------------
Name: Xxxxxxx X. Xxxxxx Xx.
Title: Senior Vice President
XXXXXX XXXXXXX CAPITAL I INC.
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
EXHIBIT 1
MORTGAGE LOAN SCHEDULE
CUT-OFF
LOAN DATE
POOL NO. MORTGAGE LOAN SELLER LOAN NUMBER PROPERTY NAME BALANCE NOTE DATE
-------- -------------------- ----------- ----------------------- ----------- ----------
4 BSCMI 0-000 Xxxx Xxxxxxx Business $56,191,000 03/14/2006
Park 7 (I)
5 BSCMI 0-000 Xxxx Xxxxxxx Business $26,809,000 03/14/2006
Park 5 (I)
6 BSCMI 5-001 1275 K Street $66,000,000 06/12/2006
11 BSCMI 10-001 000 Xxxxxxxx Xxxxxx $23,830,000 05/12/2006
12 BSCMI 11-001 The Jewelers Mall $22,960,626 05/18/2006
16 BSCMI 15-001 Black Rock Turnpike $20,600,000 02/28/2006
19 BSCMI 00-000 Xxxx Xxxxxx Xxxxx $18,715,000 04/11/2006
22 BSCMI 21-001 Boudin at the Wharf $17,000,000 03/09/2006
23 BSCMI 22-001 0 Xxxx 00xx Xxxxxx $17,000,000 05/15/2006
24 BSCMI 23-001 Cost Plus - Stockton $16,300,000 04/07/2006
27 BSCMI 26-001 Town Center West $12,500,000 05/11/2006
33 BSCMI 00-000 Xxxxxxxxx Center $10,800,000 04/13/2006
39 BSCMI 35-001 Addison Shopping Center $10,468,774 04/13/2006
40 BSCMI 00-000 Xxxxxx Xxxxx Pavilion $10,347,000 05/31/2006
42 BSCMI 38-001 Bed Bath & Beyond and $ 9,700,000 06/15/2006
Borders
43 BSCMI 39-001 Palo Verde Village $ 9,500,000 05/26/2006
45 BSCMI 00-000 Xxxxxxxxxx Xxxxxx $ 9,000,000 04/28/2006
Shopping Center
54 BSCMI 48-001 Xxxx'x Supermarket $ 7,770,425 03/30/2006
60 BSCMI 00-000 Xxxxxxxxxx $ 7,500,000 12/23/2005
61 BSCMI 55-001 Lansing Shopping Center $ 7,500,000 05/26/2006
71 BSCMI 00-000 Xxxxxxx Xxxxxx Shopping $ 5,940,000 03/02/2006
Center
72 BSCMI 00-000 Xxxxxx Xxxxxxx Xxxxx $ 5,600,000 05/04/2006
79 BSCMI 00-000 Xxxxxxxxxx Xxxxxxxx $ 4,950,000 05/24/2006
98 BSCMI 00-000 Xxxxxxx Xxxxx $ 3,960,082 04/20/2006
101 BSCMI 94-001 CVS - Miami $ 3,643,616 05/05/2006
103 BSCMI 00-000 Xxxxxx - Xxxxxx $ 3,526,928 05/09/2006
107 BSCMI 100-001 Whole Foods Shopping $ 3,300,000 04/19/2006
Center
113 BSCMI 106-001 Porta D' Italia $ 3,150,000 04/07/2006
117 BSCMI 110-001 Rite Aid - Xxxxxxx $ 3,000,000 05/10/2006
119 BSCMI 112-001 000-000 Xxxxx Xxxxxx $ 2,994,413 05/17/2006
120 BSCMI 113-001 0000 Xxxxxxx Xxxxxxx $ 2,994,239 05/16/2006
121 BSCMI 114-001 Super 8 Phoenix $ 2,993,254 05/31/2006
124 BSCMI 000-000 Xxxxxx - Xxxxxxxxxxx $ 2,856,083 05/09/2006
131 BSCMI 124-001 Victory Storage $ 2,493,289 04/13/2006
137 BSCMI 000-000 Xxxxxx - Xxxxxxxxxxxxxx $ 2,294,025 04/13/2006
148 BSCMI 139-001 Markets at Mesa Ridge $ 2,000,000 03/24/2006
1-1
150 BSCMI 141-001 CVS Akron $ 1,880,000 03/17/2006
154 BSCMI 145-001 Forum Credit $ 1,544,151 03/03/2006
Union/O'Charley's
160 BSCMI 151-001 15 Merchants Concourse $ 1,350,000 02/24/2006
Notes:
1. Master Servicing fees in excess of 0.02% (or 0.01% for MSMC loans) include a
subservicing fee
1-2
ORIGINAL MONTHLY
TERM TO DEBT
LOAN MORTGAGE MATURITY REMAINING ORIG. REM. SERVICE
POOL NO. LOAN SELLER OR ARD TERM AMORT. AMORT. RATE (P&I)
-------- ----------- -------- --------- ------ ------ ----- -------
4 BSCMI 120 116 IO IO 5.549% NAP
5 BSCMI 120 116 IO IO 5.549% NAP
6 BSCMI 120 119 IO IO 5.969% NAP
11 BSCMI 144 142 360 360 6.387% $148,855
12 BSCMI 120 118 360 358 6.294% $142,274
16 BSCMI 120 115 360 360 5.365% $115,226
19 BSCMI 60 57 IO IO 4.924% NAP
22 BSCMI 120 116 348 348 5.832% $101,379
23 BSCMI 120 118 360 360 5.744% $ 99,143
24 BSCMI 84 81 IO IO 5.255% NAP
27 BSCMI 120 118 IO IO 6.136% NAP
33 BSCMI 120 117 360 360 5.673% $ 62,499
39 BSCMI 120 117 360 357 5.527% $ 59,796
40 BSCMI 60 58 IO IO 4.920% NAP
42 BSCMI 180 179 IO IO 6.316% NAP
43 BSCMI 120 118 IO IO 6.201% NAP
45 BSCMI 120 117 360 360 5.819% $ 52,917
54 BSCMI 180 176 360 356 5.862% $ 46,075
60 BSCMI 120 113 IO IO 5.140% NAP
61 BSCMI 120 118 IO IO 6.045% NAP
71 BSCMI 120 116 IO IO 5.636% NAP
72 BSCMI 120 118 360 360 6.006% $ 33,596
79 BSCMI 120 118 360 360 6.294% $ 30,620
98 BSCMI 180 177 360 357 6.274% $ 24,506
101 BSCMI 120 118 360 358 6.200% $ 22,355
103 BSCMI 120 118 360 358 6.277% $ 21,815
107 BSCMI 120 117 IO IO 5.469% NAP
113 BSCMI 60 57 IO IO 6.232% NAP
117 BSCMI 180 178 360 360 6.191% $ 18,357
119 BSCMI 180 178 360 358 5.920% $ 17,833
120 BSCMI 120 118 360 358 5.781% $ 17,566
121 BSCMI 120 118 300 298 7.080% $ 21,357
124 BSCMI 120 118 360 358 6.277% $ 17,666
131 BSCMI 120 117 360 357 5.972% $ 14,944
137 BSCMI 120 117 360 357 6.111% $ 13,954
148 BSCMI 120 116 360 360 5.975% $ 11,959
150 BSCMI 120 116 360 360 5.784% $ 11,012
154 BSCMI 120 116 360 356 5.884% $ 9,178
160 BSCMI 120 115 IO IO 5.507% NAP
1-3
MASTER
LOAN ADMIN SERVICE PRIMARY
POOL MORTGAGE YM LO END DEF/ COST FEE SERVICE
NO. LOAN SELLER SEASONING CODE LO DATE DEF YMI YM1 OPEN RATE RATE(1) FEE RATE
---- ----------- --------- ---- -- ---------- --- ---- --- ---- ----- ------- --------
4 BSCMI 4 28 2/29/2016 90 2 3.145 2.000 1.000
5 BSCMI 4 28 2/29/2016 90 2 3.145 2.000 1.000
6 BSCMI 1 25 6/30/2016 94 1 3.145 2.000 1.000
11 BSCMI 2 26 4/30/2018 116 2 3.145 2.000 1.000
12 BSCMI 2 26 5/31/2016 93 1 3.145 2.000 1.000
16 BSCMI 5 29 2/29/2016 90 1 8.145 8.000 0.000
19 BSCMI 3 D 35 4/30/2009 23 2 3.145 2.000 1.000
22 BSCMI 4 28 2/29/2016 90 2 7.145 6.000 1.000
23 BSCMI 2 26 4/30/2016 92 2 3.145 2.000 1.000
24 BSCMI 3 D 35 4/30/2009 47 2 3.145 2.000 1.000
27 BSCMI 2 26 5/31/2016 93 1 3.145 2.000 1.000
33 BSCMI 3 27 3/31/2016 91 2 3.145 2.000 1.000
39 BSCMI 3 27 2/29/2016 90 3 7.145 6.000 1.000
40 BSCMI 2 D 35 5/31/2009 23 2 3.145 2.000 1.000
42 BSCMI 1 25 3/31/2021 151 4 3.145 2.000 1.000
43 BSCMI 2 26 3/31/2016 91 3 3.145 2.000 1.000
45 BSCMI 3 F 27 8/31/2008 92 1 3.145 2.000 1.000
54 BSCMI 4 G 23 3/31/2008 153 4 7.145 6.000 1.000
60 BSCMI 7 D 35 12/31/2008 83 2 3.145 2.000 1.000
61 BSCMI 2 D 35 5/31/2009 83 2 3.145 2.000 1.000
71 BSCMI 4 28 12/31/2015 88 4 3.145 2.000 1.000
72 BSCMI 2 J 47 5/31/2010 72 1 8.145 7.000 1.000
79 BSCMI 2 26 5/31/2016 93 1 3.145 2.000 1.000
98 BSCMI 3 27 4/30/2021 152 1 3.145 2.000 1.000
101 BSCMI 2 26 5/31/2016 93 1 3.145 2.000 1.000
103 BSCMI 2 26 5/31/2016 93 1 3.145 2.000 1.000
107 BSCMI 3 G 23 4/30/2008 93 4 7.145 6.000 1.000
113 BSCMI 3 27 3/31/2011 31 2 3.145 2.000 1.000
117 BSCMI 2 26 5/31/2021 153 1 3.145 2.000 1.000
119 BSCMI 2 26 5/31/2021 153 1 3.145 2.000 1.000
120 BSCMI 2 26 5/31/2016 93 1 3.145 2.000 1.000
121 BSCMI 2 26 5/31/2016 93 1 3.145 2.000 1.000
124 BSCMI 2 26 5/31/2016 93 1 3.145 2.000 1.000
131 BSCMI 3 27 4/30/2016 92 1 3.145 2.000 1.000
137 BSCMI 3 27 4/30/2016 92 1 8.145 8.000 0.000
148 BSCMI 4 28 2/29/2016 90 2 8.145 7.000 1.000
150 BSCMI 4 N 0 NAP 91 28 1 3.145 2.000 1.000
154 BSCMI 4 N 0 NAP 91 28 1 3.145 2.000 1.000
160 BSCMI 5 F 29 8/31/2008 87 4 3.145 2.000 1.000
1-4
MASTER PRIMARY
EXCESS EXCESS
LOAN MORTGAGE SERV. SERVICING EXCESS
POOL LOAN FEE RATE FEE RATE DEAL TRUSTEE FEE SERVICE FEE
NO. SELLER (BPS) (BPS) FEES RATE RATE
---- -------- -------- --------- ----- ----------- -----------
4 BSCMI 0.000 0.000 3.000 0.145 0.000
5 BSCMI 0.000 0.000 3.000 0.145 0.000
6 BSCMI 0.000 0.000 3.000 0.145 0.000
11 BSCMI 0.000 0.000 3.000 0.145 0.000
12 BSCMI 0.000 0.000 3.000 0.145 0.000
16 BSCMI 0.000 0.000 8.000 0.145 0.000
19 BSCMI 0.000 0.000 3.000 0.145 0.000
22 BSCMI 0.000 0.000 7.000 0.145 0.000
23 BSCMI 0.000 0.000 3.000 0.145 0.000
24 BSCMI 0.000 0.000 3.000 0.145 0.000
27 BSCMI 0.000 0.000 3.000 0.145 0.000
33 BSCMI 0.000 0.000 3.000 0.145 0.000
39 BSCMI 0.000 0.000 7.000 0.145 0.000
40 BSCMI 0.000 0.000 3.000 0.145 0.000
42 BSCMI 0.000 0.000 3.000 0.145 0.000
43 BSCMI 0.000 0.000 3.000 0.145 0.000
45 BSCMI 0.000 0.000 3.000 0.145 0.000
54 BSCMI 0.000 0.000 7.000 0.145 0.000
60 BSCMI 0.000 0.000 3.000 0.145 0.000
61 BSCMI 0.000 0.000 3.000 0.145 0.000
71 BSCMI 0.000 0.000 3.000 0.145 0.000
72 BSCMI 0.000 0.000 8.000 0.145 0.000
79 BSCMI 0.000 0.000 3.000 0.145 0.000
98 BSCMI 0.000 0.000 3.000 0.145 0.000
101 BSCMI 0.000 0.000 3.000 0.145 0.000
103 BSCMI 0.000 0.000 3.000 0.145 0.000
107 BSCMI 0.000 0.000 7.000 0.145 0.000
113 BSCMI 0.000 0.000 3.000 0.145 0.000
117 BSCMI 0.000 0.000 3.000 0.145 0.000
119 BSCMI 0.000 0.000 3.000 0.145 0.000
120 BSCMI 0.000 0.000 3.000 0.145 0.000
121 BSCMI 0.000 0.000 3.000 0.145 0.000
124 BSCMI 0.000 0.000 3.000 0.145 0.000
131 BSCMI 0.000 0.000 3.000 0.145 0.000
137 BSCMI 0.000 0.000 8.000 0.145 0.000
148 BSCMI 0.000 0.000 8.000 0.145 0.000
150 BSCMI 0.000 0.000 3.000 0.145 0.000
154 BSCMI 0.000 0.000 3.000 0.145 0.000
160 BSCMI 0.000 0.000 3.000 0.145 0.000
1-5
EXHIBIT 2
REPRESENTATIONS AND WARRANTIES REGARDING
INDIVIDUAL MORTGAGE LOANS
1. Mortgage Loan Schedule. The information set forth in the Mortgage Loan
Schedule is complete, true and correct in all material respects as of the date
of this Agreement and as of the Cut-Off Date.
2. Whole Loan; Ownership of Mortgage Loans. Each Mortgage Loan is a whole loan
and not a participation interest in a mortgage loan. Immediately prior to the
transfer to Purchaser of the Mortgage Loans, Seller had good title to, and was
the sole owner of, each Mortgage Loan. Seller has full right, power and
authority to transfer and assign each of the Mortgage Loans to or at the
direction of Purchaser and has validly and effectively conveyed (or caused to be
conveyed) to Purchaser or its designee all of Seller's legal and beneficial
interest in and to the Mortgage Loans free and clear of any and all pledges,
liens, charges, security interests and/or other encumbrances. The sale of the
Mortgage Loans to Purchaser or its designee does not require Seller to obtain
any governmental or regulatory approval or consent that has not been obtained.
3. Payment Record. No scheduled payment of principal and interest under any
Mortgage Loan was 30 days or more past due as of the Cut-Off Date, and no
Mortgage Loan was 30 days or more delinquent in the twelve-month period
immediately preceding the Cut-Off Date.
4. Lien; Valid Assignment. The Mortgage related to and delivered in connection
with each Mortgage Loan constitutes a valid and, subject to the exceptions set
forth in paragraph 13 below, enforceable first priority lien upon the related
Mortgaged Property, prior to all other liens and encumbrances, except for (a)
the lien for current real estate taxes and assessments not yet due and payable,
(b) covenants, conditions and restrictions, rights of way, easements and other
matters that are of public record and/or are referred to in the related lender's
title insurance policy, (c) exceptions and exclusions specifically referred to
in such lender's title insurance policy, (d) other matters to which like
properties are commonly subject, none of which matters referred to in clauses
(b), (c) or (d), individually or in the aggregate, materially interferes with
the security intended to be provided by such Mortgage, the marketability or
current use of the Mortgaged Property or the current ability of the Mortgaged
Property to generate operating income sufficient to service the Mortgage Loan
debt and (e) if such Mortgage Loan is cross-collateralized with any other
Mortgage Loan, the lien of the Mortgage for such other Mortgage Loan (the
foregoing items (a) through (e), the "Permitted Encumbrances"). The related
assignment of such Mortgage executed and delivered in favor of the Trustee is in
recordable form and constitutes a legal, valid and binding assignment,
sufficient to convey to the assignee named therein all of the assignor's right,
title and interest in, to and under such Mortgage. Such Mortgage, together with
any separate security agreements, chattel mortgages or equivalent instruments,
establishes and creates a valid and, subject to the exceptions set forth in
paragraph 13 below, enforceable security interest in favor of the holder thereof
in all of the related Mortgagor's personal property used in, and reasonably
necessary to operate, the related Mortgaged Property. In the case of a Mortgaged
Property operated as a hotel or an assisted living facility, the Mortgagor's
personal property includes all personal property that a prudent mortgage lender
making a similar Mortgage Loan would deem reasonably necessary to operate the
related Mortgaged Property as it is currently being operated. A Uniform
Commercial Code
2-1
financing statement has been filed and/or recorded in all places necessary to
perfect a valid security interest in such personal property, to the extent a
security interest may be so created therein, and such security interest is a
first priority security interest, subject to any prior purchase money security
interest in such personal property and any personal property leases applicable
to such personal property. Notwithstanding the foregoing, no representation is
made as to the perfection of any security interest in rents or other personal
property to the extent that possession or control of such items or actions other
than the filing of Uniform Commercial Code financing statements are required in
order to effect such perfection.
5. Assignment of Leases and Rents. The Assignment of Leases related to and
delivered in connection with each Mortgage Loan establishes and creates a valid,
subsisting and, subject to the exceptions set forth in paragraph 13 below,
enforceable first priority lien and first priority security interest in the
related Mortgagor's interest in all leases, sub-leases, licenses or other
agreements pursuant to which any person is entitled to occupy, use or possess
all or any portion of the real property subject to the related Mortgage, and
each assignor thereunder has the full right to assign the same. The related
assignment of any Assignment of Leases not included in a Mortgage has been
executed and delivered in favor of the Trustee and is in recordable form and
constitutes a legal, valid and binding assignment, sufficient to convey to the
assignee named therein all of the assignor's right, title and interest in, to
and under such Assignment of Leases.
6. Mortgage Status; Waivers and Modifications. No Mortgage has been satisfied,
cancelled, rescinded or subordinated in whole or in part, and the related
Mortgaged Property has not been released from the lien of such Mortgage, in
whole or in part (except for partial reconveyances of real property that are set
forth on Schedule A to Exhibit 2), nor has any instrument been executed that
would effect any such satisfaction, cancellation, subordination, rescission or
release, in any manner that, in each case, materially adversely affects the
value of the related Mortgaged Property. None of the terms of any Mortgage Note,
Mortgage or Assignment of Leases has been impaired, waived, altered or modified
in any respect, except by written instruments, all of which are included in the
related Mortgage File.
7. Condition of Property; Condemnation. Except with respect to Mortgage Loans
secured primarily by unimproved land: (i) with respect to the Mortgaged
Properties securing the Mortgage Loans that were the subject of an engineering
report within 18 months prior to the Cut-Off Date as set forth on Schedule A to
this Exhibit 2, each Mortgaged Property is, to Seller's knowledge, free and
clear of any damage (or adequate reserves therefor have been established) that
would materially and adversely affect its value as security for the related
Mortgage Loan, and (ii) with respect to the Mortgaged Properties securing the
Mortgage Loans that were not the subject of an engineering report within 18
months prior to the Cut-Off Date as set forth on Schedule A to this Exhibit 2,
each Mortgaged Property is in good repair and condition and all building systems
contained therein are in good working order (or adequate reserves therefor have
been established) and each Mortgaged Property is free of structural defects, in
each case, that would materially and adversely affect its value as security for
the related Mortgage Loan as of the date hereof. Seller has received no notice
of the commencement of any proceeding for the condemnation of all or any
material portion of any Mortgaged Property. To Seller's knowledge (based on
surveys and/or title insurance obtained in connection with the origination of
the Mortgage Loans), as of the date of the origination of each Mortgage Loan,
all of the material improvements on the related Mortgaged Property that were
considered in determining the
2-2
appraised value of the Mortgaged Property lay wholly within the boundaries and
building restriction lines of such property, except for encroachments that are
insured against by the lender's title insurance policy referred to herein or
that do not materially and adversely affect the value or marketability of such
Mortgaged Property, and no improvements on adjoining properties materially
encroached upon such Mortgaged Property so as to materially and adversely affect
the value or marketability of such Mortgaged Property, except those
encroachments that are insured against by the Title Policy referred to herein.
8. Title Insurance. Each Mortgaged Property is covered by an American Land Title
Association (or an equivalent form of) lender's title insurance policy or a
marked-up title insurance commitment (on which the required premium has been
paid) which evidences such title insurance policy (the "Title Policy") in the
original principal amount of the related Mortgage Loan after all advances of
principal. Each Title Policy insures that the related Mortgage is a valid first
priority lien on such Mortgaged Property, subject only to Permitted
Encumbrances. Each Title Policy (or, if it has yet to be issued, the coverage to
be provided thereby) is in full force and effect, all premiums thereon have been
paid and no material claims have been made thereunder and no claims have been
paid thereunder. No holder of the related Mortgage has done, by act or omission,
anything that would materially impair the coverage under such Title Policy.
Immediately following the transfer and assignment of the related Mortgage Loan
to the Trustee, such Title Policy (or, if it has yet to be issued, the coverage
to be provided thereby) will inure to the benefit of the Trustee without the
consent of or notice to the insurer. To Seller's knowledge, the insurer issuing
such Title Policy is qualified to do business in the jurisdiction in which the
related Mortgaged Property is located.
9. No Holdbacks. The proceeds of each Mortgage Loan have been fully disbursed
and there is no obligation for future advances with respect thereto. With
respect to each Mortgage Loan, any and all requirements as to completion of any
on-site or off-site improvement and as to disbursements of any funds escrowed
for such purpose that were to have been complied with on or before the Closing
Date have been complied with, or any such funds so escrowed have not been
released.
10. Mortgage Provisions. The Mortgage Note or Mortgage for each Mortgage Loan,
together with applicable state law, contains customary and enforceable
provisions (subject to the exceptions set forth in paragraph 13) such as to
render the rights and remedies of the holder thereof adequate for the practical
realization against the related Mortgaged Property of the principal benefits of
the security intended to be provided thereby.
11. Trustee under Deed of Trust. If any Mortgage is a deed of trust, (1) a
trustee, duly qualified under applicable law to serve as such, is properly
designated and serving under such Mortgage, and (2) no fees or expenses are
payable to such trustee by Seller, Purchaser or any transferee thereof except in
connection with a trustee's sale after default by the related Mortgagor or in
connection with any full or partial release of the related Mortgaged Property or
related security for the related Mortgage Loan.
12. Environmental Conditions.
2-3
(i) Except as set forth on Schedule A to this Exhibit 2, with respect to
the Mortgaged Properties securing the Mortgage Loans that were the
subject of an environmental site assessment within 18 months prior to
the Cut-Off Date, an environmental site assessment prepared to ASTM
standards, or an update of a previous such report, was performed with
respect to each Mortgaged Property in connection with the origination
or the sale of the related Mortgage Loan, a report of each such
assessment (or the most recent assessment with respect to each
Mortgaged Property) (an "Environmental Report") has been delivered to,
or on behalf of, Purchaser or its designee, and Seller has no
knowledge of any material and adverse environmental condition or
circumstance affecting any Mortgaged Property that was not disclosed
in such report. Each Mortgage requires the related Mortgagor to comply
with all applicable federal, state and local environmental laws and
regulations. Where such assessment disclosed the existence of a
material and adverse environmental condition or circumstance affecting
any Mortgaged Property, (i) a party not related to the Mortgagor was
identified as the responsible party for such condition or circumstance
or (ii) environmental insurance covering such condition was obtained
or must be maintained until the condition is remediated or (iii) the
related Mortgagor was required either to provide additional security
that was deemed to be sufficient by the originator in light of the
circumstances and/or to establish an operations and maintenance plan.
Each Mortgage Loan set forth on Schedule C to this Exhibit 2 (each, a
"Schedule C Loan") is the subject of a Secured Creditor Impaired
Property Policy, issued by the issuer set forth on Schedule C (the
"Policy Issuer") and effective as of the date thereof (the
"Environmental Insurance Policy"). Except as set forth on Schedule A
to this Exhibit 2, with respect to each Schedule C Loan, (i) the
Environmental Insurance Policy is in full force and effect, (ii)(a) a
property condition or engineering report was prepared with respect to
lead based paint ("LBP") and radon gas ("RG") at each Mortgaged
Property that is used as a multifamily dwelling, and with respect to
asbestos containing materials ("ACM") at each related Mortgaged
Property and (b) if such report disclosed the existence of a material
and adverse LBP, ACM or RG environmental condition or circumstance
affecting the related Mortgaged Property, the related Mortgagor (A)
was required to remediate the identified condition prior to closing
the Mortgage Loan or provide additional security, or establish with
the lender a reserve from loan proceeds, in an amount deemed to be
sufficient by Seller for the remediation of the problem and/or (B)
agreed in the Mortgage Loan documents to establish an operations and
maintenance plan after the closing of the Mortgage Loan, (iii) on the
effective date of the Environmental Insurance Policy, Seller as
originator had no knowledge of any material and adverse environmental
condition or circumstance affecting the Mortgaged Property (other than
the existence of LBP, ACM or RG) that was not disclosed to the Policy
Issuer in one or more of the following: (a) the application for
insurance, (b) a borrower questionnaire that was provided to the
Policy Issuer or (c) an engineering or other report provided to the
Policy Issuer and (iv) the premium of any Environmental Insurance
Policy has been paid through the maturity of the policy's term and the
term of such policy extends at least five years beyond the maturity of
the Mortgage Loan.
2-4
(ii) With respect to the Mortgaged Properties securing the Mortgage Loans
that were not the subject of an environmental site assessment prepared
to ASTM standards within 18 months prior to the Cut-Off Date as set
forth on Schedule A to this Exhibit 2, (i) no Hazardous Material is
present on such Mortgaged Property such that (1) the value of such
Mortgaged Property is materially and adversely affected or (2) under
applicable federal, state or local law, (a) such Hazardous Material
could be required to be eliminated at a cost materially and adversely
affecting the value of the Mortgaged Property before such Mortgaged
Property could be altered, renovated, demolished or transferred or (b)
the presence of such Hazardous Material could (upon action by the
appropriate governmental authorities) subject the owner of such
Mortgaged Property, or the holders of a security interest therein, to
liability for the cost of eliminating such Hazardous Material or the
hazard created thereby at a cost materially and adversely affecting
the value of the Mortgaged Property, and (ii) such Mortgaged Property
is in material compliance with all applicable federal, state and local
laws pertaining to Hazardous Materials or environmental hazards, any
noncompliance with such laws does not have a material adverse effect
on the value of such Mortgaged Property and neither Seller nor, to
Seller's knowledge, the related Mortgagor or any current tenant
thereon, has received any notice of violation or potential violation
of any such law.
"Hazardous Materials" means gasoline, petroleum products, explosives,
radioactive materials, polychlorinated biphenyls or related or similar
materials, and any other substance or material as may be defined as a
hazardous or toxic substance by any federal, state or local
environmental law, ordinance, rule, regulation or order, including
without limitation, the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended (42 U.S.C. Sections
9601 et seq.), the Hazardous Materials Transportation Act as amended
(42 U.S.C. Sections 6901 et seq.), the Federal Water Pollution Control
Act as amended (33 U.S.C. Sections 1251 et seq.), the Clean Air Act
(42 U.S.C. Sections 1251 et seq.) and any regulations promulgated
pursuant thereto.
13. Loan Document Status. Each Mortgage Note, Mortgage and other agreement that
evidences or secures such Mortgage Loan and was executed by or on behalf of the
related Mortgagor is the legal, valid and binding obligation of the maker
thereof (subject to any non-recourse provisions contained in any of the
foregoing agreements and any applicable state anti-deficiency or market value
limit deficiency legislation), enforceable in accordance with its terms, except
as such enforcement may be limited by bankruptcy, insolvency, reorganization or
other similar laws affecting the enforcement of creditors' rights generally, and
by general principles of equity (regardless of whether such enforcement is
considered in a proceeding in equity or at law) and there is no valid defense,
counterclaim or right of offset or rescission available to the related Mortgagor
with respect to such Mortgage Note, Mortgage or other agreement.
14. Insurance. Each Mortgaged Property is, and is required pursuant to the
related Mortgage to be, insured by (a) a fire and extended perils insurance
policy providing coverage against loss or damage sustained by reason of fire,
lightning, windstorm, hail, explosion, riot, riot attending a strike, civil
commotion, aircraft, vehicles and smoke, and, to the extent required as of the
date of
2-5
origination by the originator of such Mortgage Loan consistent with its normal
commercial mortgage lending practices, against other risks insured against by
persons operating like properties in the locality of the Mortgaged Property in
an amount not less than the lesser of the principal balance of the related
Mortgage Loan and the replacement cost of the Mortgaged Property, and not less
than the amount necessary to avoid the operation of any co-insurance provisions
with respect to the Mortgaged Property, and the policy contains no provisions
for a deduction for depreciation; (b) a business interruption or rental loss
insurance policy, in an amount at least equal to six months of operations of the
Mortgaged Property estimated as of the date of origination by the originator of
such Mortgage Loan consistent with its normal commercial lending practices; (c)
a flood insurance policy (if any portion of buildings or other structures on the
Mortgaged Property are located in an area identified by the Federal Emergency
Management Agency as having special flood hazards and the Federal Emergency
Management Agency requires flood insurance to be maintained); and (d) a
comprehensive general liability insurance policy in amounts as are generally
required by commercial mortgage lenders, and in any event not less than $1
million per occurrence. Such insurance policy contains a standard mortgagee
clause that names the mortgagee as an additional insured in the case of
liability insurance policies and as a loss payee in the case of property
insurance policies and requires prior notice to the holder of the Mortgage of
termination or cancellation. No such notice has been received, including any
notice of nonpayment of premiums, that has not been cured. Each Mortgage
obligates the related Mortgagor to maintain all such insurance and, upon such
Mortgagor's failure to do so, authorizes the holder of the Mortgage to maintain
such insurance at the Mortgagor's cost and expense and to seek reimbursement
therefor from such Mortgagor. Each Mortgage provides that casualty insurance
proceeds will be applied (a) to the restoration or repair of the related
Mortgaged Property, (b) to the restoration or repair of the related Mortgaged
Property, with any excess insurance proceeds after restoration or repair being
paid to the Mortgagor, or (c) to the reduction of the principal amount of the
Mortgage Loan.
15. Taxes and Assessments. As of the Closing Date, there are no delinquent or
unpaid taxes, assessments (including assessments payable in future installments)
or other outstanding charges affecting any Mortgaged Property that are or may
become a lien of priority equal to or higher than the lien of the related
Mortgage. For purposes of this representation and warranty, real property taxes
and assessments shall not be considered unpaid until the date on which interest
or penalties would be first payable thereon.
16. Mortgagor Bankruptcy. No Mortgagor is, to Seller's knowledge, a debtor in
any state or federal bankruptcy or insolvency proceeding. As of the date of
origination, (i) with respect to Mortgage Loans with a principal balance greater
than $3,500,000, no tenant physically occupying 25% or more (by square feet) of
the net rentable area of the related Mortgaged Property was, to Seller's
knowledge, a debtor in any state or federal bankruptcy or insolvency proceeding
and (ii) with respect to Mortgage Loans with a principal balance equal to or
less than $3,500,000 no tenant physically occupying 50% or more (by square feet)
of the net rentable area of the related Mortgaged Property was, to Seller's
knowledge, a debtor in any state or federal bankruptcy or insolvency proceeding.
17. Leasehold Estate. Each Mortgaged Property consists of a fee simple estate in
real estate or, if the related Mortgage Loan is secured in whole or in part by
the interest of a Mortgagor as a lessee under a ground lease of a Mortgaged
Property (a "Ground Lease"), by the related
2-6
Mortgagor's interest in the Ground Lease but not by the related fee interest in
such Mortgaged Property (the "Fee Interest"), and as to such Ground Leases:
(i) Such Ground Lease or a memorandum thereof has been or will be duly
recorded; such Ground Lease (or the related estoppel letter or
lender protection agreement between Seller and related lessor) does
not prohibit the current use of the Mortgaged Property and does not
prohibit the interest of the lessee thereunder to be encumbered by
the related Mortgage; and there has been no material change in the
payment terms of such Ground Lease since the origination of the
related Mortgage Loan, with the exception of material changes
reflected in written instruments that are a part of the related
Mortgage File;
(ii) The lessee's interest in such Ground Lease is not subject to any
liens or encumbrances superior to, or of equal priority with, the
related Mortgage, other than Permitted Encumbrances;
(iii) The Mortgagor's interest in such Ground Lease is assignable to
Purchaser and its successors and assigns upon notice to, but without
the consent of, the lessor thereunder (or, if such consent is
required, it has been obtained prior to the Closing Date) and, in
the event that it is so assigned, is further assignable by Purchaser
and its successors and assigns upon notice to, but without the need
to obtain the consent of, such lessor or if such lessor's consent is
required it cannot be unreasonably withheld;
(iv) Such Ground Lease is in full force and effect, and the Ground Lease
provides that no material amendment to such Ground Lease is binding
on a mortgagee unless the mortgagee has consented thereto, and
Seller has received no notice that an event of default has occurred
thereunder, and, to Seller's knowledge, there exists no condition
that, but for the passage of time or the giving of notice, or both,
would result in an event of default under the terms of such Ground
Lease;
(v) Such Ground Lease, or an estoppel letter or other agreement, (A)
requires the lessor under such Ground Lease to give notice of any
default by the lessee to the holder of the Mortgage; and (B)
provides that no notice of termination given under such Ground Lease
is effective against the holder of the Mortgage unless a copy of
such notice has been delivered to such holder and the lessor has
offered or is required to enter into a new lease with such holder on
terms that do not materially vary from the economic terms of the
Ground Lease.
(vi) A mortgagee is permitted a reasonable opportunity (including, where
necessary, sufficient time to gain possession of the interest of the
lessee under such Ground Lease) to cure any default under such
Ground Lease, which is curable after the receipt of notice of any
such default, before the lessor thereunder may terminate such Ground
Lease;
2-7
(vii) Such Ground Lease has an original term (including any extension
options set forth therein) which extends not less than twenty years
beyond the Stated Maturity Date of the related Mortgage Loan;
(viii) Under the terms of such Ground Lease and the related Mortgage, taken
together, any related insurance proceeds or condemnation award
awarded to the holder of the ground lease interest will be applied
either (A) to the repair or restoration of all or part of the
related Mortgaged Property, with the mortgagee or a trustee
appointed by the related Mortgage having the right to hold and
disburse such proceeds as the repair or restoration progresses
(except in such cases where a provision entitling a third party to
hold and disburse such proceeds would not be viewed as commercially
unreasonable by a prudent commercial mortgage lender), or (B) to the
payment of the outstanding principal balance of the Mortgage Loan
together with any accrued interest thereon; and
(ix) Such Ground Lease does not impose any restrictions on subletting
which would be viewed as commercially unreasonable by prudent
commercial mortgage lenders lending on a similar Mortgaged Property
in the lending area where the Mortgaged Property is located; and
such Ground Lease contains a covenant that the lessor thereunder is
not permitted, in the absence of an uncured default, to disturb the
possession, interest or quiet enjoyment of the lessee thereunder for
any reason, or in any manner, which would materially adversely
affect the security provided by the related Mortgage.
(x) Such Ground Lease requires the Lessor to enter into a new lease upon
termination of such Ground Lease if the Ground Lease is rejected in
a bankruptcy proceeding.
18. Escrow Deposits. All escrow deposits and payments relating to each Mortgage
Loan that are, as of the Closing Date, required to be deposited or paid have
been so deposited or paid.
19. LTV Ratio. The gross proceeds of each Mortgage Loan to the related Mortgagor
at origination did not exceed the non-contingent principal amount of the
Mortgage Loan and either: (a) such Mortgage Loan is secured by an interest in
real property having a fair market value (i) at the date the Mortgage Loan was
originated, at least equal to 80 percent of the original principal balance of
the Mortgage Loan or (ii) at the Closing Date, at least equal to 80 percent of
the principal balance of the Mortgage Loan on such date; provided that for
purposes hereof, the fair market value of the real property interest must first
be reduced by (x) the amount of any lien on the real property interest that is
senior to the Mortgage Loan and (y) a proportionate amount of any lien that is
in parity with the Mortgage Loan (unless such other lien secures a Mortgage Loan
that is cross-collateralized with such Mortgage Loan, in which event the
computation described in clauses (a)(i) and (a)(ii) of this paragraph 19 shall
be made on a pro rata basis in accordance with the fair market values of the
Mortgaged Properties securing such cross-collateralized Mortgage Loans); or (b)
substantially all the proceeds of such Mortgage Loan were used to acquire,
improve or protect the real property that served as the only security for such
Mortgage Loan (other than a recourse feature or other third party credit
enhancement within the meaning of Treasury Regulations Section
1.860G-2(a)(1)(ii)).
2-8
20. Mortgage Loan Modifications. Any Mortgage Loan that was "significantly
modified" prior to the Closing Date so as to result in a taxable exchange under
Section 1001 of the Code either (a) was modified as a result of the default
under such Mortgage Loan or under circumstances that made a default reasonably
foreseeable or (b) satisfies the provisions of either clause (a)(i) of paragraph
19 (substituting the date of the last such modification for the date the
Mortgage Loan was originated) or clause (a)(ii) of paragraph 19, including the
proviso thereto.
21. Advancement of Funds by Seller. No holder of a Mortgage Loan has advanced
funds or induced, solicited or knowingly received any advance of funds from a
party other than the owner of the related Mortgaged Property, directly or
indirectly, for the payment of any amount required by such Mortgage Loan.
22. No Mechanics' Liens. Each Mortgaged Property is free and clear of any and
all mechanics' and materialmen's liens that are prior or equal to the lien of
the related Mortgage, and no rights are outstanding that under law could give
rise to any such lien that would be prior or equal to the lien of the related
Mortgage except, in each case, for liens insured against by the Title Policy
referred to herein.
23. Compliance with Usury Laws. Each Mortgage Loan complied with all applicable
usury laws in effect at its date of origination.
24. Cross-collateralization. No Mortgage Loan is cross-collateralized or
cross-defaulted with any loan other than one or more other Mortgage Loans.
25. Releases of Mortgaged Property. Except as described in the next sentence, no
Mortgage Note or Mortgage requires the mortgagee to release all or any material
portion of the related Mortgaged Property that was included in the appraisal for
such Mortgaged Property, and/or generates income from the lien of the related
Mortgage except upon payment in full of all amounts due under the related
Mortgage Loan or in connection with the defeasance provisions of the related
Note and Mortgage. The Mortgages relating to those Mortgage Loans identified on
Schedule A hereto require the mortgagee to grant releases of portions of the
related Mortgaged Properties upon (a) the satisfaction of certain legal and
underwriting requirements and/or (b) the payment of a predetermined or
objectively determinable release price and prepayment consideration in
connection therewith. Except as described in the first sentence hereof and for
those Mortgage Loans identified on Schedule A, no Mortgage Loan permits the full
or partial release or substitution of collateral unless the mortgagee or
servicer can require the Borrower to provide an opinion of tax counsel to the
effect that such release or substitution of collateral (a) would not constitute
a "significant modification" of such Mortgage Loan within the meaning of Treas.
Reg. Section 1.1001-3 and (b) would not cause such Mortgage Loan to fail to be a
"qualified mortgage" within the meaning of Section 860G(a)(3)(A) of the Code.
26. No Equity Participation or Contingent Interest. No Mortgage Loan contains
any equity participation by the lender or provides for negative amortization
(except that the ARD Loan may provide for the accrual of interest at an
increased rate after the Anticipated Repayment Date) or for any contingent or
additional interest in the form of participation in the cash flow of the related
Mortgaged Property.
2-9
27. No Material Default. To Seller's knowledge, there exists no material
default, breach, violation or event of acceleration (and no event which, with
the passage of time or the giving of notice, or both, would constitute any of
the foregoing) under the documents evidencing or securing the Mortgage Loan, in
any such case to the extent the same materially and adversely affects the value
of the Mortgage Loan and the related Mortgaged Property; provided, however, that
this representation and warranty does not address or otherwise cover any
default, breach, violation or event of acceleration that specifically pertains
to any matter otherwise covered by any other representation and warranty made by
Seller in any of paragraphs 3, 7, 8, 12, 14, 15, 16 and 17 of this Exhibit 2.
28. Inspections. Seller (or if Seller is not the originator, the originator of
the Mortgage Loan) has inspected or caused to be inspected each Mortgaged
Property in connection with the origination of the related Mortgage Loan.
29. Local Law Compliance. Based on due diligence considered reasonable by
prudent commercial mortgage lenders in the lending area where the Mortgaged
Property is located, the improvements located on or forming part of each
Mortgaged Property comply with applicable zoning laws and ordinances, or
constitute a legal non-conforming use or structure or, if any such improvement
does not so comply, such non-compliance does not materially and adversely affect
the value of the related Mortgaged Property, such value as determined by the
appraisal performed at origination or in connection with the sale of the related
Mortgage Loan by Seller hereunder.
30. Junior Liens. None of the Mortgage Loans permits the related Mortgaged
Property to be encumbered by any lien (other than a Permitted Encumbrance)
junior to or of equal priority with the lien of the related Mortgage without the
prior written consent of the holder thereof or the satisfaction of debt service
coverage or similar criteria specified therein. Seller has no knowledge that any
of the Mortgaged Properties is encumbered by any lien junior to the lien of the
related Mortgage.
31. Actions Concerning Mortgage Loans. To the knowledge of Seller, there are no
actions, suits or proceedings before any court, administrative agency or
arbitrator concerning any Mortgage Loan, Mortgagor or related Mortgaged Property
that might adversely affect title to the Mortgaged Property or the validity or
enforceability of the related Mortgage or that might materially and adversely
affect the value of the Mortgaged Property as security for the Mortgage Loan or
the use for which the premises were intended.
32. Servicing. The servicing and collection practices used by Seller or any
prior holder or servicer of each Mortgage Loan have been in all material
respects legal, proper and prudent and have met customary industry standards.
33. Licenses and Permits. To Seller's knowledge, based on due diligence that it
customarily performs in the origination of comparable mortgage loans, as of the
date of origination of each Mortgage Loan or as of the date of the sale of the
related Mortgage Loan by Seller hereunder, the related Mortgagor was in
possession of all material licenses, permits and franchises required by
applicable law for the ownership and operation of the related Mortgaged Property
as it was then operated.
2-10
34. Assisted Living Facility Regulation. If the Mortgaged Property is operated
as an assisted living facility, to Seller's knowledge (a) the related Mortgagor
is in compliance in all material respects with all federal and state laws
applicable to the use and operation of the related Mortgaged Property and (b) if
the operator of the Mortgaged Property participates in Medicare or Medicaid
programs, the facility is in compliance in all material respects with the
requirements for participation in such programs.
35. Collateral in Trust. The Mortgage Note for each Mortgage Loan is not secured
by a pledge of any collateral that has not been assigned to Purchaser.
36. Due on Sale. Each Mortgage Loan contains a "due on sale" clause, which
provides for the acceleration of the payment of the unpaid principal balance of
the Mortgage Loan if, without prior written consent of the holder of the
Mortgage, the property subject to the Mortgage or any material portion thereof,
or a controlling interest in the related Mortgagor, is transferred, sold or
encumbered by a junior mortgage or deed of trust; provided, however, that
certain Mortgage Loans provide a mechanism for the assumption of the loan by a
third party upon the Mortgagor's satisfaction of certain conditions precedent,
and upon payment of a transfer fee, if any, or transfer of interests in the
Mortgagor or constituent entities of the Mortgagor to a third party or parties
related to the Mortgagor upon the Mortgagor's satisfaction of certain conditions
precedent.
37. Single Purpose Entity. The Mortgagor on each Mortgage Loan with a Cut-Off
Date Principal Balance in excess of $10 million, was, as of the origination of
the Mortgage Loan, a Single Purpose Entity. For this purpose, a "Single Purpose
Entity" shall mean an entity, other than an individual, whose organizational
documents provide substantially to the effect that it was formed or organized
solely for the purpose of owning and operating one or more of the Mortgaged
Properties securing the Mortgage Loans and prohibit it from engaging in any
business unrelated to such Mortgaged Property or Properties, and whose
organizational documents further provide, or which entity represented in the
related Mortgage Loan documents, substantially to the effect that it does not
have any assets other than those related to its interest in and operation of
such Mortgaged Property or Properties, or any indebtedness other than as
permitted by the related Mortgage(s) or the other related Mortgage Loan
documents, that it has its own books and records and accounts separate and apart
from any other person (other than a Mortgagor for a Mortgage Loan that is
cross-collateralized and cross-defaulted with the related Mortgage Loan), and
that it holds itself out as a legal entity, separate and apart from any other
person.
38. Non-Recourse Exceptions. The Mortgage Loan documents for each Mortgage Loan
provide that such Mortgage Loan constitutes either (a) the recourse obligations
of at least one natural person or (b) the non-recourse obligations of the
related Mortgagor, provided that at least one natural person (and the Mortgagor
if the Mortgagor is not a natural person) is liable to the holder of the
Mortgage Loan for damages arising in the case of fraud or willful
misrepresentation by the Mortgagor, misappropriation of rents, insurance
proceeds or condemnation awards and breaches of the environmental covenants in
the Mortgage Loan documents.
39. Defeasance and Assumption Costs. The related Mortgage Loan documents provide
that the related borrower is responsible for the payment of all reasonable costs
and expenses of the
2-11
lender incurred in connection with the defeasance of such Mortgage Loan and the
release of the related Mortgaged Property, and the borrower is required to pay
all reasonable costs and expenses of the lender associated with the approval of
an assumption of such Mortgage Loan.
40. Defeasance. No Mortgage Loan provides that (i) it can be defeased until the
date that is more than two years after the Closing Date, (ii) that it can be
defeased with any property other than government securities (as defined in
Section 2(a)(16) of the Investment Company Act of 1940, as amended) or any
direct non-callable security issued or guaranteed as to principal or interest by
the United States that will provide interest and principal payments sufficient
to satisfy scheduled payments of interest and principal as required under the
related Mortgage Loan, or (iii) defeasance requires the payment of any
consideration other than (a) reimbursement of incidental costs and expenses
and/or (b) a specified dollar amount or an amount that is based on a formula
that uses objective financial information (as defined in Treasury Regulation
Section 1.446-3(c)(4)(ii)).
41. Prepayment Premiums. As of the applicable date of origination of each such
Mortgage Loan, any prepayment premiums and yield maintenance charges payable
under the terms of the Mortgage Loans, in respect of voluntary prepayments,
constituted customary prepayment premiums and yield maintenance charges for
commercial mortgage loans.
42. Terrorism Insurance. With respect to each Mortgage Loan that has a principal
balance as of the Cut-off Date that is greater than or equal to $20,000,000, the
related all risk insurance policy and business interruption policy do not
specifically exclude Acts of Terrorism, as defined in the Terrorism Risk
Insurance Act of 2002, from coverage, or if such coverage is excluded, is
covered by a separate terrorism insurance policy. With respect to each other
Mortgage Loan, the related all risk insurance policy and business interruption
policy did not as of the date of origination of the Mortgage Loan, and, to
Seller's knowledge, do not, as of the date hereof, specifically exclude Acts of
Terrorism from coverage, or if such coverage is excluded, it is covered by a
separate terrorism insurance policy. With respect to each of the Mortgage Loans,
the related Mortgage Loan documents do not expressly waive or prohibit the
mortgagee from requiring coverage for acts of terrorism or damages related
thereto, except to the extent that any right to require such coverage may be
limited by commercially reasonable availability, or as otherwise indicated on
Schedule A.
43. Foreclosure Property. Seller is not selling any Mortgage Loan as part of a
plan to transfer the underlying Mortgaged Property to Purchaser, and Seller does
not know or, to Seller's knowledge, have reason to know that any Mortgage Loan
will default. The representations in this paragraph 43 are being made solely for
the purpose of determining whether the Mortgaged Property, if acquired by the
Trust, would qualify as "foreclosure property" within the meaning of Section
860G(a)(8) of the Code, and may not be relied upon or used for any other
purpose. Such representations shall not be construed as a guarantee to any
degree that defaults or losses will not occur.
2-12
Schedule A
Exceptions to Representations and Warranties
REP NO. LOAN NO. LOAN NAME EXPLANATION
------------------------ -------- ----------------------- --------------------------------
14
Insurance 46840 Eckerd - The Tenant, Eckerd, maintains
Fredericksburg insurance; Business Income is
not provided by Tenant. Lender
approved this exception based on
1) No abatement of rent, and 2)
land value exceeds loan amount.
Tenant's insurance carrier will
not agree to 10 day notice
provision for non payment of
premium.
45987 Lake Fairfax Business Per the loan documents, the
Park 5&7 borrower is not required to
spend in excess of 150% of the
cost at closing (adjusted by
annual CPI increases) of a stand
alone policy for terrorism.
17
Leasehold Estate Boudin at the Wharf The Borrower's interest in the
Ground Lease is assignable from
Borrower to Lender through or in
lieu of foreclosure upon notice
to, but without the consent of,
the ground lessor. Any further
assignment by Lender, however,
shall require the consent of
Ground Lessor, which shall not
be unreasonably withheld or
delayed. The Borrower is not in
default under the Ground Lease,
nor does any condition exist
which could result in a default,
except that the Ground Lessor
has given Borrower notice of an
alleged existing drainage
problem in violation of the City
building code. Lender heldback
$32,500 from the Loan proceeds
until Borrower either corrects
such condition or obtains the
agreement of Ground Lessor that
such condition is not required
to be corrected by Borrower.
The representation provides that
all insurance proceeds must be
used either to pay down the loan
or to restore the property. The
Ground Lease does provide that
in the event of a Major Casualty
(50%), if Tenant elects to
terminate the lease, the
proceeds are paid as follows:
(a) to Ground Lessor for costs
of work performed to alleviate
conditions constituting an
immediate or imminent threat to
public safety or damage to the
environment, (b) to Ground
Lessor for all accrued and
unpaid minimum rent and
percentage rent owned as of the
date of termination, and (c) to
Lender to pay all funds under
the Loan.
25
Releases/Substitution of 45650 Markets at Mesa Ridge The related Mortgagor may obtain
Mortgaged Property substitution of property to
include an additional parking
area within the existing
property upon (a) the
satisfaction of certain legal
and underwriting requirements,
(b) the DSCR for the substituted
property shall not be less than
1.50x and (c) the payment of an
administrative fee.
45987 Lake Fairfax Business The Loan provides for release of
Park 5&7 a property in connection with
defeasance of 110% of the
allocated loan amount. Among
other things, the release shall
not be permitted if the DSCR for
the unreleased property is less
than 1.5x or the LTV is greater
than 70%.
The Loan provides for the
release of certain outparcels.
45677 Cost Plus - Stockton The Loan provides for (a) the
release of one vacant parcel
upon the satisfaction of certain
legal and underwriting
requirements and (b) one vacant
ground leased parcel upon the
condominium-izaton of such
parcel and the satisfaction of
certain legal and underwriting
requirements.
46974 Bed Bath Beyond & The Loan provides for the
Borders release of certain outparcels.
36
Due on Sale 44885 Innsbrooke Tenant in common interests are
transferable on predetermined
conditions.
38
Non-Recourse Exceptions 44645 Battle Ridge Pavilion Non-recourse provisions go to
the related Mortgagor and to
Inland Western Retail Real
Estate Trust, Inc., but not to a
"natural person".
44885 Innsbrooke Non-recourse provisions go to
the related Mortgagor and to
Inland Real Estate Investment
Corp., but not to a "natural
person".
45677 Cost Plus - Stockton Non-recourse provisions go to
the related Mortgagor and to
Inland Western Retail Real
Estate Trust, Inc., but not to a
"natural person".
00000 Xxxx Xxxxxx Non-recourse provisions go to
the related Mortgagor and to
Inland Western Retail Real
Estate Trust, Inc., but not to a
"natural person".
46691 Lansing Shopping Center Non-recourse provisions go to
the related Mortgagor and to
Inland Real Estate Investment
Corporation, but not to a
"natural person".
45650 Markets at Mesa Ridge Non-recourse provisions go to
the related Mortgagor and to
Xxxxxx Doyas Properties, LLC.,
but not to a "natural person".
46974 Bed Bath Beyond and Non-recourse provisions for
Borders environmental matters go to the
related Mortgagor only.
45987 Lake Fairfax Non-recourse provisions go to
the related Mortgagor only.
00000 Xxxxxx Xxxxxxx Xxxxx Non-recourse provisions go to
the related Mortgagor only.
46911 Rite Aid Xxxxxxx Recourse carveout liability is
capped at $1,000,000.
46247 Boudin at the Wharf Non-recourse provisions go to
the related Mortgagor and to
Andre-Boudin Holding Company,
Inc., but not to a "natural
person".
00000 Xxxxxxx Xxxxxx Shopping Non-recourse provisions go to
Center the related Mortgagor and to
Xxxx Operating Partnership II,
LP but not to a "natural
person".
46514 Xxxx'x Supermarket Non-recourse provisions go to
the related Mortgagor and to The
Hampshire Generational Fund, LLC
but not to a "natural person".
46575 Whole Foods Shopping Non-recourse provisions go to
Center the related Mortgagor and to The
Hampshire Legacy Fund, LLC but
not to a "natural person".
Schedule B
List of Mortgagors that are Third-Party Beneficiaries Under Section 5.5
None
Schedule C
List of Mortgage Loans Subject to Secured Creditor Impaired Property Policies
EXHIBIT 3
PRICING FORMULATION
Total Bond Proceeds $1,602,911,567
Less Expenses ($5,079,831)
--------------
Net Proceeds $1,597,831,736 1,597,831,736
Less Purchase Price of BS Loans
Discounted Value of BS Loans $ 435,187,621
Allocable Expense Amount for BS Loans ($1,084,974)
--------------
Purchase Price of BS Loans $ 434,102,646 ($434,102,646)
Less Purchase Price of WF Loans
Discounted Value of WF Loans $ 390,730,403
Allocable Expense Amount for WF Loans ($1,349,108)
--------------
Purchase Price of WF Loans $ 389,381,295 ($389,381,295)
Less Purchase Price of PCF Loans
Discounted Value of PCF Loans $ 393,012,739
Allocable Expense Amount for PCF Loans ($1,423,948)
--------------
Purchase Price of PCF Loans $ 391,588,791 ($391,588,791)
Less Purchase Price of MS Loans
Discounted Value of MS Loans $ 385,068,054
Allocable Expense Amount for MS Loans ($1,221,800)
--------------
Purchase Price of MS Loans $ 383,846,254 ($383,846,254)
Remaining Proceeds ($1,087,249)
BS Share of Remaining Proceeds ($294,986)
WF Share of Remaining Proceeds ($264,851)
PCF Share of Remaining Proceeds ($266,398)
MS Share of Remaining Proceeds ($261,013)
Total Proceeds Allocated to BS $433,807,660
Total Proceeds Allocated to WF $389,116,443
Total Proceeds Allocated to PCF $391,322,392
Total Proceeds Allocated to MS $383,585,240
3-1
EXHIBIT 4
XXXX OF SALE
1. Parties. The parties to this Xxxx of Sale are the following:
Seller: Bear Xxxxxxx Commercial Mortgage, Inc.
Purchaser: Xxxxxx Xxxxxxx Capital I Inc.
2. Sale. For value received, Seller hereby conveys to Purchaser, without
recourse, all right, title and interest in and to the Mortgage Loans identified
on Exhibit 1 (the "Mortgage Loan Schedule") to the Mortgage Loan Purchase
Agreement, dated as of July 19, 2006 (the "Mortgage Loan Purchase Agreement"),
between Seller and Purchaser and all of the following property:
(a) All accounts, general intangibles, chattel paper, instruments,
documents, money, deposit accounts, certificates of deposit, goods, letters
of credit, advices of credit and investment property consisting of, arising
from or relating to any of the following property: the Mortgage Loans
identified on the Mortgage Loan Schedule including the related Mortgage
Notes, Mortgages, security agreements, and title, hazard and other
insurance policies, all distributions with respect thereto payable after
the Cut-Off Date, all substitute or replacement Mortgage Loans and all
distributions with respect thereto, and the Mortgage Files;
(b) All accounts, general intangibles, chattel paper, instruments,
documents, money, deposit accounts, certificates of deposit, goods, letters
of credit, advices of credit, investment property, and other rights arising
from or by virtue of the disposition of, or collections with respect to, or
insurance proceeds payable with respect to, or claims against other Persons
with respect to, all or any part of the collateral described in clause (a)
above (including any accrued discount realized on liquidation of any
investment purchased at a discount); and
(c) All cash and non-cash proceeds of the collateral described in
clauses (a) and (b) above.
3. Purchase Price. The amount and other consideration set forth on Exhibit 3 to
the Mortgage Loan Purchase Agreement.
4. Definitions. Terms used but not defined herein shall have the meanings
assigned to them in the Mortgage Loan Purchase Agreement.
4-1
IN WITNESS WHEREOF, each of the parties hereto has caused this Xxxx of Sale to
be duly executed and delivered on this 19th day of July 2006.
SELLER: BEAR XXXXXXX COMMERCIAL MORTGAGE, INC.
By:
------------------------------------
Name:
------------------------------
Title:
-----------------------------
PURCHASER: XXXXXX XXXXXXX CAPITAL I INC.
By:
------------------------------------
Name:
------------------------------
Title:
-----------------------------
EXHIBIT 5
FORM OF LIMITED POWER OF ATTORNEY
TO LASALLE BANK NATIONAL ASSOCIATION
AND ARCAP SERVICING, INC.
WITH RESPECT TO
XXXXXX XXXXXXX CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 2006-TOP23
KNOW ALL MEN BY THESE PRESENTS:
WHEREAS, pursuant to the terms of the Mortgage Loan Purchase Agreement
dated as of July 19, 2006 (the "Mortgage Loan Purchase Agreement"), between Bear
Xxxxxxx Commercial Mortgage, Inc. ("BSCMI") and Xxxxxx Xxxxxxx Capital I Inc.
("Depositor"), BSCMI is selling certain multifamily and commercial mortgage
loans (the "Mortgage Loans") to Depositor;
WHEREAS, pursuant to the terms of the Pooling and Servicing Agreement dated
as of August 1, 2006 (the "Pooling and Servicing Agreement"), between the
Depositor, Xxxxx Fargo Bank, National Association, as Master Servicer, ARCap
Servicing, Inc. ("ARCAP") as Special Servicer, LaSalle Bank National Association
("LaSalle") as Trustee and Xxxxx Fargo Bank, National Association, as Paying
Agent, the Trustee and the Special Servicer are granted certain powers,
responsibilities and authority in connection with the completion and the filing
and recording of assignments of mortgage, deeds of trust or similar documents,
Form UCC-2 and UCC-3 assignments of financing statements, reassignments of
assignments of leases, rents and profits and other Mortgage Loan documents
required to be filed or recorded in appropriate public filing and recording
offices;
WHEREAS, BSCMI has agreed to provide this Limited Power of Attorney
pursuant to the Mortgage Loan Purchase Agreement;
NOW, THEREFORE, BSCMI does hereby make, constitute and appoint LaSalle,
acting solely in its capacity as Trustee under, and in accordance with the terms
of, the Pooling and Servicing Agreement, BSCMI's true and lawful agent and
attorney-in-fact with respect to each Mortgage Loan in BSCMI's name, place and
stead: (i) to complete (to the extent necessary) and to cause to be submitted
for filing or recording in the appropriate public filing or recording offices,
all assignments of mortgage, deeds of trust or similar documents, assignments or
reassignments of rents, leases and profits, in each case in favor of the Trustee
as set forth in the definition of "Mortgage File" in Section 1.1 of the Pooling
and Servicing Agreement, that have been received by the Trustee or a Custodian
on its behalf, and all Form UCC-2 or UCC-3 assignments of financing statements
and all other comparable instruments or documents with respect to the Mortgage
Loans which are customarily and reasonably necessary or appropriate to assign
agreements, documents and instruments pertaining to the Mortgage Loans, in each
case in favor of the Trustee, as set forth in the definition of "Mortgage File"
in, and in accordance with Section 1.1 of, the Pooling and Servicing Agreement,
and to evidence, provide notice of and perfect such assignments and conveyances
in favor of the Trustee in the public records of the
5-1
appropriate filing and recording offices; and (ii) to file or record in the
appropriate public filing or recording offices, all other Mortgage Loan
documents to be recorded under the terms of the Pooling and Servicing Agreement
or any such Mortgage Loan documents which have not been submitted for filing or
recordation by BSCMI on or before the date hereof or which have been so
submitted but are subsequently lost or returned unrecorded or unfiled as a
result of actual or purported defects therein, in order to evidence, provide
notice of and perfect such documents in the public records of the appropriate
filing and recording offices. Notwithstanding the foregoing, this Limited Power
of Attorney shall grant to LaSalle and ARCAP only such powers, responsibilities
and authority as are set forth in Section 2.1 of the Mortgage Loan Purchase
Agreement.
BSCMI does also hereby make, constitute and appoint ARCAP, acting solely in
its capacity as Special Servicer under the Pooling and Servicing Agreement,
BSCMI's true and lawful agent and attorney-in-fact with respect to the Mortgage
Loans in BSCMI's name, place and stead solely to exercise and perform all of the
rights, authority and powers of LaSalle as set forth in the preceding paragraph
in the event of the failure or the incapacity of LaSalle to do so for any
reason. As between ARCAP and any third party, no evidence of the failure or
incapacity of LaSalle shall be required and such third party may rely upon
ARCAP's written statement that it is acting pursuant to the terms of this
Limited Power of Attorney.
Article I.
The enumeration of particular powers herein is not intended in any way to
limit the grant to either the Trustee or the Special Servicer as BSCMI's
attorney-in-fact of full power and authority with respect to the Mortgage Loans
to complete (to the extent necessary), file and record any documents,
instruments or other writings referred to above as fully, to all intents and
purposes, as BSCMI might or could do if personally present, hereby ratifying and
confirming whatsoever such attorney-in-fact shall and may do by virtue hereof;
and BSCMI agrees and represents to those dealing with such attorney-in-fact that
they may rely upon this Limited Power of Attorney until termination thereof
under the provisions of Article III below. As between BSCMI, the Depositor, the
Master Servicer, the Special Servicer, the Trustee, the Trust Fund and the
Certificateholders, neither the Trustee nor the Special Servicer may exercise
any right, authority or power granted by this Limited Power of Attorney in a
manner which would violate the terms of the Pooling and Servicing Agreement, but
any and all third parties dealing with either the Trustee or the Special
Servicer as BSCMI's attorney-in-fact may rely completely, unconditionally and
conclusively on the authority of the Trustee or the Special Servicer, as
applicable, and need not make any inquiry about whether the Trustee or the
Special Servicer is acting pursuant to the Pooling and Servicing Agreement. Any
purchaser, title insurance company or other third party may rely upon a written
statement by either the Trustee or the Special Servicer that any particular
Mortgage Loan or related mortgaged real property in question is subject to and
included under this Limited Power of Attorney and the Pooling and Servicing
Agreement.
Article II.
Any act or thing lawfully done hereunder by either the Trustee or the
Special Servicer shall be binding on BSCMI and BSCMI's successors and assigns.
Article III.
This Limited Power of Attorney shall continue in full force and effect with
respect to the Trustee and the Special Servicer, as applicable, until the
earliest occurrence of any of the following events:
Section 3.01 with respect to the Trustee, the termination of the Trustee
and its replacement with a successor Trustee under the terms of the Pooling
and Servicing Agreement;
Section 3.02 with respect to the Special Servicer, the termination of the
Special Servicer and its replacement with a successor Special Servicer
under the terms of the Pooling and Servicing Agreement;
Section 3.03 with respect to the Trustee, the appointment of a receiver or
conservator with respect to the business of the Trustee, or the filing of a
voluntary or involuntary petition in bankruptcy by or against the Trustee;
Section 3.04 with respect to the Special Servicer, the appointment of a
receiver or conservator with respect to the business of the Special
Servicer, or the filing of a voluntary or involuntary petition in
bankruptcy by or against the Special Servicer;
Section 3.05 with respect to each of the Trustee and the Special Servicer
and any Mortgage Loan, such Mortgage Loan is no longer a part of the Trust
Fund;
Section 3.06 with respect to each of the Trustee and the Special Servicer,
the termination of the Pooling and Servicing Agreement in accordance with
its terms; and
Section 3.07 with respect to the Special Servicer, the occurrence of an
Event of Default under the Pooling and Servicing Agreement with respect to
the Special Servicer.
Nothing herein shall be deemed to amend or modify the Pooling and Servicing
Agreement, the Mortgage Loan Purchase Agreement or the respective rights, duties
or obligations of BSCMI under the Mortgage Loan Purchase Agreement, and nothing
herein shall constitute a waiver of any rights or remedies under the Pooling and
Servicing Agreement.
Article IV.
Capitalized terms used but not defined herein have the respective meanings
assigned thereto in the Mortgage Loan Purchase Agreement.
Article V.
THIS LIMITED POWER OF ATTORNEY SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AND THE OBLIGATIONS, RIGHTS
AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH
SUCH LAWS WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES APPLIED IN NEW YORK.
[Signature on next page]
IN WITNESS WHEREOF, BSCMI has caused this instrument to be executed and its
corporate seal to be affixed hereto by its officer duly authorized as of August
3, 2006.
BEAR XXXXXXX COMMERCIAL MORTGAGE, INC.
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
ACKNOWLEDGEMENT
STATE OF NEW YORK )
) ss:
COUNTY OF NEW YORK )
On this 3rd day of August, 2006, before me appeared ______________________,
to me personally known, who, being by me duly sworn did say that he/she is the
__________________ of Bear Xxxxxxx Commercial Mortgage, Inc., and that the seal
affixed to the foregoing instrument is the corporate seal of said corporation,
and that said instrument was signed and sealed in behalf of said corporation by
authority of its board of directors, and said ________________________
acknowledged said instrument to be the free act and deed of said corporation.
______________________________________________
Name:
________________________________________
Notary Public in and for said County and State
My Commission Expires:
_________________________________
