Exhibit 99.4
EXECUTION COPY
MORTGAGE LOAN PURCHASE AGREEMENT
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This Mortgage Loan Purchase Agreement (this "Agreement"), is dated and
effective as of August 21, 1998, between Xxxxxx Brothers Holdings Inc., doing
business as Xxxxxx Capital, a Division of Xxxxxx Brothers Holdings Inc., as
seller (the "Seller") and GMAC Commercial Mortgage Securities, Inc. as purchaser
(the "Purchaser").
The Seller desires to sell, assign, transfer and otherwise convey to the
Purchaser, and the Purchaser desires to purchase, subject to the terms and
conditions set forth below, the multifamily and commercial mortgage loans or
interests therein (the "Mortgage Loans") identified on the schedule annexed
hereto as EXHIBIT A (the "Mortgage Loan Schedule"). It is hereby acknowledged
and agreed that certain of the Mortgage Loans (the "Pass Through Loans") are, in
each such case, subject to a pass through trust agreement (a "Pass Through Trust
Agreement") and represented by a pass-through certificate (a "Loan
Certificate").
It is expected that the Mortgage Loans will be transferred, together with
other multifamily and commercial mortgage loans to a trust fund (the "Trust
Fund") to be formed by the Purchaser, beneficial ownership of which will be
evidenced by a series of mortgage pass-through certificates (the
"Certificates"). Certain classes of the Certificates will be rated by Standard
& Poor's Ratings Services, Xxxxx'x Investors Service, Inc. and FITCH IBCA Inc.
(together, the "Rating Agencies"). Certain classes of the Certificates (the
"Registered Certificates") will be registered under the Securities Act of 1933,
as amended (the "Securities Act"). The Trust Fund will be created and the
Certificates will be issued pursuant to a pooling and servicing agreement to be
dated as of August 1, 1998 (the "Pooling and Servicing Agreement"), among the
Purchaser as depositor, GMAC Commercial Mortgage Corporation as master servicer
(in such capacity, the "Master Servicer") and special servicer (in such
capacity, the "Special Servicer"), LaSalle National Bank as trustee (in such
capacity, the "Trustee") and ABN AMRO Bank N.V. as fiscal agent. Capitalized
terms not otherwise defined herein have the meanings assigned to them in the
Pooling and Servicing Agreement as in effect on the Closing Date.
The Purchaser intends to sell certain of the Certificates to Xxxxxx
Brothers Inc. and Deutsche Bank Securities Inc. (together, the "Underwriters")
pursuant to an underwriting agreement dated the date hereof (the "Underwriting
Agreement"). The Purchaser intends to sell the remaining Certificates (the
"Non-Registered Certificates") to Xxxxxx Brothers Inc. (the "Initial
Purchaser"), pursuant to a certificate purchase agreement dated the date hereof
(the "Certificate Purchase Agreement").
Now, therefore, in consideration of the premises and the mutual agreements
set forth herein, the parties agree as follows:
SECTION 1. AGREEMENT TO PURCHASE.
The Seller agrees to sell, assign, transfer and otherwise convey to the
Purchaser, and the Purchaser agrees to purchase, the Mortgage Loans. The
purchase and sale of the Mortgage Loans shall take place on August 27, 1998 or
such other date as shall be mutually acceptable to the parties hereto (the
"Closing Date"). The "Cut-off Date" with respect to any Mortgage Loan is the
Due Date for such Mortgage Loan in August 1998. As of the close of business on
their respective Cut-off Dates, the Mortgage Loans will have an aggregate
principal balance (the "Aggregate Cut-off Date Balance"), after application of
all payments of principal due thereon on or before such date, whether or not
received, of $1,367,070,323, subject to a variance of plus or minus 5%. The
purchase price for the Mortgage Loans shall be determined and paid to the Seller
in accordance with a term sheet (the "Allocation Agreement") that has been
agreed to by the Mortgage Loan Sellers and the Purchaser.
SECTION 2. CONVEYANCE OF MORTGAGE LOANS.
(a) Effective as of the Closing Date, subject only to receipt by the
Seller of the purchase price referred to in Section 1 hereof (exclusive of any
applicable holdback for transaction expenses in accordance with the Allocation
Agreement), the Seller does hereby sell, transfer, assign, set over and
otherwise convey to the Purchaser, without recourse, all the right, title and
interest of the Seller in and to the Mortgage Loans identified on the Mortgage
Loan Schedule as of such date, including all interest and principal received or
receivable by the Seller on or with respect to each Mortgage Loan after the
Cut-Off Date for such Mortgage Loan, together with all of the Seller's right,
title and interest in and to the proceeds of any related title, hazard, or other
insurance policies and any escrow, reserve or other comparable accounts related
to each Mortgage Loan. The Purchaser shall be entitled to (and, to the extent
received by or on behalf of the Seller, the Seller shall deliver or cause to be
delivered to or at the direction of the Purchaser) all scheduled payments of
principal and interest due on each Mortgage Loan after the Cut-Off Date for such
Mortgage Loan, and all other recoveries of principal and interest collected
thereon after such Cut-off Date. All scheduled payments of principal and
interest due on each Mortgage Loan on or before the Cut-off Date for such
Mortgage Loan and collected after such Cut-off Date shall belong to the Seller.
(b) In connection with the Seller's assignment pursuant to subsection (a)
above, the Seller hereby agrees that, at least five (5) Business Days before the
Closing Date, it shall have delivered to and deposited with the Trustee, the
Mortgage File (as described on EXHIBIT B hereto) for each Mortgage Loan so
assigned. It is further acknowledged and agreed by the Seller that the
Purchaser intends to cause the Trustee to perform a limited review of such
Mortgage Files to enable the Trustee to confirm to the Purchaser on or before
the Closing Date that the Mortgage Note referred to in clause (i) of EXHIBIT B
has been delivered by the Seller with respect to each such Mortgage File. In
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the event Seller fails to so deliver each such Mortgage File to the Trustee, the
Purchaser and its successors and assigns shall be entitled to pursue any rights
or remedies in respect of such failure as may be available under applicable law.
If the Seller cannot deliver, or cause to be delivered as to any Mortgage Loan,
the original Mortgage Note, the Seller shall deliver a copy or duplicate
original of such Mortgage Note, together with an affidavit certifying that the
original thereof has been lost or destroyed. If the Seller cannot deliver, or
cause to be delivered, as to any Mortgage Loan, the original or a copy of any of
the documents and/or instruments referred to in subclauses (ii), (iv), (viii),
(xi)(A) and (xii) of clause (a) of EXHIBIT B, with evidence of recording
thereon, solely because of a delay caused by the public recording or filing
office where such document or instrument has been delivered for recordation or
filing, or because such original recorded document has been lost or returned
from the recording or filing office and subsequently lost, as the case may be,
the delivery requirements of this Section 2(b) shall be deemed to have been
satisfied as to such missing item, and such missing item shall be deemed to have
been included in the related Mortgage File, provided that a copy of such
document or instrument (without evidence of recording or filing thereon, but
certified (which certificate may relate to multiple documents and/or
instruments) by the Seller to be a true and complete copy of the original
thereof submitted for recording or filing, as the case may be) has been
delivered to the Trustee, and either the original of such missing document or
instrument, or a copy thereof, with evidence of recording or filing, as the case
may be, thereon, is delivered to or at the direction of the Purchaser (or any
subsequent owner of the affected Mortgage Loan, including without limitation the
Trustee) within 180 days of the Closing Date (or within such longer period after
the Closing Date as the Purchaser (or such subsequent owner) may consent to,
which consent shall not be unreasonably withheld so long as the Seller has
provided the Purchaser (or such subsequent owner) with evidence of such
recording or filing, as the case may be, or has certified to the Purchaser (or
such subsequent owner) as to the occurrence of such recording or filing, as the
case may be, and is, as certified to the Purchaser (or such subsequent owner) no
less often than quarterly, in good faith attempting to obtain from the
appropriate county recorder's or filing office such original or copy). If the
Seller cannot deliver, or cause to be delivered, as to any Mortgage Loan, the
original or a copy of the related lender's title insurance policy referred to in
subclause (ix) of subclause (a) of EXHIBIT B solely because such policy has not
yet been issued, the delivery requirements of this Section 2(b) shall be deemed
to be satisfied as to such missing item, and such missing item shall be deemed
to have been included in the related Mortgage File, provided that the Seller has
delivered to the Trustee a commitment for title insurance "marked-up" at the
closing of such Mortgage Loan, and the Seller shall deliver to or at the
direction of the Purchaser (or any subsequent owner of the affected Mortgage
Loan, including without limitation the Trustee), promptly following the receipt
thereof, the original related lender's title insurance policy (or a copy
thereof). In addition, notwithstanding anything to the contrary contained
herein, if there exists with respect to any group of related
cross-collateralized Mortgage Loans only one original of any document referred
to in clause (a) of EXHIBIT B covering all the Mortgage Loans in such group,
then the inclusion of the original of such document in the Mortgage File for any
of the Mortgage Loans in such group shall be deemed an inclusion of such
original in the Mortgage File for each such Mortgage Loan. Also notwithstanding
the foregoing, the Mortgage File for any Pass Through Loan will consist solely
of the related Loan Certificate; and, if more than one Pass Through Loan is
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subject to the same Pass Through Trust Agreement, the Seller may, to the extent
appropriate, deliver to the Trustee one Loan Certificate covering all such
Mortgage Loans. On the Closing Date, upon notification from the Seller that the
purchase price referred to in Section 1 (exclusive of any applicable holdback
for transaction expenses in accordance with the Allocation Agreement) has been
received by the Seller, the Trustee shall be authorized to release to the
Purchaser or its designee all of the Mortgage Files in the Trustee's possession
relating to the Mortgage Loans.
(c) As to each Mortgage Loan, the Seller shall be responsible for all
costs associated with the recording or filing, as the case may be, of each
assignment referred to in clauses (a) (iii) and (a) (v) of EXHIBIT B and each
UCC-2 and UCC-3, if any, referred to in clause (a) (xi)(B) of EXHIBIT B and the
re-registration or assignment of the Loan Certificates, if any, referred to in
clause (b) of EXHIBIT B; provided that the Seller shall not be responsible for
actually recording, filing or re-registering any such document or instrument.
If any such document or instrument is lost or returned unrecorded, unfiled or
not re-registered, as the case may be, because of a defect therein, the Seller
shall promptly prepare or cause the preparation of a substitute therefor or cure
or cause the curing of such defect, as the case may be, and shall thereafter
deliver the substitute or corrected document to or at the direction of the
Purchaser (or any subsequent owner of the affected Mortgage Loan, including
without limitation the Trustee) for recording, filing or re-registration, as
appropriate, at the Seller's expense.
(d) All documents and records in the Seller's possession (or under its
control) relating to the Mortgage Loans that are not required to be a part of a
Mortgage File in accordance with EXHIBIT B (all such other documents and
records, as to any Mortgage Loan, the "Servicing File"), together with all
escrow payments, reserve funds and other comparable funds in the possession of
the Seller (or under its control) with respect to the Mortgage Loans, shall
(unless they are held by a sub-servicer that shall, as of the Closing Date,
begin acting on behalf of the Master Servicer pursuant to a written agreement
between such parties) be delivered by the Seller (or its agent) to the Purchaser
(or its designee) no later than the Closing Date. If a sub-servicer shall, as
of the Closing Date, begin acting on behalf of the Master Servicer with respect
to any Mortgage Loan pursuant to a written agreement between such parties, the
Seller shall deliver a copy of the related Servicing File to the Master
Servicer.
(e) The Seller's records will reflect the transfer of the Mortgage Loans
to the Purchaser as a sale.
(f) The Seller further hereby covenants and agrees that with respect to
each of the Pass Through Loans, the Seller will promptly, but no later than 90
days after the Closing Date, take all reasonable steps necessary to amend the
related Pass Through Trust Agreement to effect a direct ownership interest in
each such Mortgage Loans by the Trustee and to dissolve the Pass Through Trust
Agreement in its entirety. In the event any Pass Through Agreement is not so
amended, the Seller hereby agrees and covenants to take all reasonable steps
necessary to modify such Pass Through Agreement to the fullest extent reasonably
practicable to effectuate the servicing and administration by the
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Trustee and the Master Servicer of each of the Pass Through Loans in a manner
similar to the Mortgage Loans not subject to any Pass Through Agreement.
SECTION 3. EXAMINATION OF MORTGAGE LOAN FILES AND DUE DILIGENCE REVIEW.
The Seller shall reasonably cooperate with any examination of the Mortgage
Files and Servicing Files that may be undertaken by or on behalf of the
Purchaser. The fact that the Purchaser has conducted or has failed to conduct
any partial or complete examination of the Mortgage Files and/or Servicing Files
shall not affect the Purchaser's right to pursue any remedy available in equity
or at law for a breach of the Seller's representations, warranties and covenants
set forth in or contemplated by Section 4.
SECTION 4. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE SELLER.
(a) The Seller hereby makes, as of the Closing Date (or as of such other
date specifically provided in the particular representation or warranty), to and
for the benefit of the Purchaser, and its successors and assigns (including,
without limitation, the Trustee and the holders of the Certificates), each of
the representations and warranties set forth in EXHIBIT C, with such changes or
modifications as may be permitted or required by the Rating Agencies.
(b) In addition, the Seller, as of the date hereof, hereby represents and
warrants to, and covenants with, the Purchaser that:
(i) The Seller is a corporation, duly organized, validly existing
and in good standing under the laws of the State of Delaware, and is in
compliance with the laws of each State in which any Mortgaged Property is
located to the extent necessary to ensure the enforceability of each
Mortgage Loan and to perform its obligations under this Agreement.
(ii) The execution and delivery of this Agreement by the Seller, and
the performance and compliance with the terms of this Agreement by the
Seller, will not violate the Seller's organizational documents or
constitute a default (or an event which, with notice or lapse of time, or
both, would constitute a default) under, or result in the breach of, any
material agreement or other instrument to which it is a party or which is
applicable to it or any of its assets, in each case which materially and
adversely affect the ability of the Seller to carry out the transactions
contemplated by this Agreement.
(iii) The Seller has the full power and authority to enter into and
consummate all transactions contemplated by this Agreement, has duly
authorized the execution, delivery and performance of this Agreement, and
has duly executed and delivered this Agreement.
(iv) This Agreement, assuming due authorization, execution and
delivery by the Purchaser, constitutes a valid, legal and binding
obligation of the Seller, enforceable against
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the Seller in accordance with the terms hereof, subject to (A) applicable
bankruptcy, insolvency, reorganization, moratorium and other laws affecting
the enforcement of creditors' rights generally, (B) general principles of
equity, regardless of whether such enforcement is considered in a
proceeding in equity or at law, and (C) 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 for securities laws liabilities.
(v) The Seller is not in violation of, and its 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, any
order or decree of any court or arbiter, or any order, regulation or demand
of any federal, state or local governmental or regulatory authority, which
violation, in the Seller's good faith and reasonable judgment, is likely to
affect materially and adversely either the ability of the Seller to perform
its obligations under this Agreement or the financial condition of the
Seller.
(vi) No litigation is pending with regard to which Seller has
received service of process or, to the best of the Seller's knowledge,
threatened against the Seller the outcome of which, in the Seller's good
faith and reasonable judgment, could reasonably be expected to prohibit the
Seller from entering into this Agreement or materially and adversely affect
the ability of the Seller to perform its obligations under this Agreement.
(vii) The Seller has not dealt with any broker, investment banker,
agent or other person, other than the Purchaser, the Underwriters, the
Initial Purchaser, and their respective affiliates, that may be entitled to
any commission or compensation in connection with the sale of the Mortgage
Loans or the consummation of any of the other transactions contemplated
hereby.
(viii) Neither the Seller nor anyone acting on its behalf has (A)
offered, pledged, sold, disposed of or otherwise transferred any
Certificate, any interest in any Certificate or any other similar security
to any person in any manner, (B) solicited any offer to buy or to accept a
pledge, disposition or other transfer of any Certificate, any interest in
any Certificate or any other similar security from any person in any
manner, (C) otherwise approached or negotiated with respect to any
Certificate, any interest in any Certificate or any other similar security
with any person in any manner, (D) made any general solicitation by means
of general advertising or in any other manner with respect to any
Certificate, any interest in any Certificate or any similar security, or
(E) taken any other action, that (in the case of any of the acts described
in clauses (A) through (E) above) would constitute or result in a violation
of the Securities Act or any state securities law relating to or in
connection with the issuance of the Certificates or require registration or
qualification pursuant to the Securities Act or any state securities law of
any Certificate not otherwise intended to be a Registered Certificate. In
addition, the Seller will not act, nor has it authorized or will it
authorize any person to act,
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in any manner set forth in the foregoing sentence with respect to any of
the Certificates or interests therein. For purposes of this paragraph
4(b)(viii), the term "similar security" shall be deemed to include, without
limitation, any security evidencing or, upon issuance, that would have
evidenced an interest in the Mortgage Loans or any substantial number
thereof.
(ix) Insofar as it relates to the Mortgage Loans, the information
set forth on pages A-1-21 through A-1-28, inclusive, of Annex A to the
Prospectus Supplement (as defined in Section 9) (the "Loan Detail") and, to
the extent consistent therewith, the information set forth on the diskette
attached to the Prospectus Supplement and the accompanying prospectus (the
"Diskette"), is true and correct in all material respects. Insofar as it
relates to the Mortgage Loans and/or the Seller and does not represent a
restatement or aggregation of the information on the Loan Detail, the
information set forth in the Prospectus Supplement and the Memorandum (as
defined in Section 9) under the headings "Summary of the Prospectus
Supplement--The Mortgage Asset Pool", "Risk Factors--The Mortgage Loans"
and "Description of the Mortgage Asset Pool", set forth on Annex A to the
Prospectus Supplement and (to the extent it contains information consistent
with that on such Annex A) set forth on the Diskette, does not contain any
untrue statement of a material fact or (in the case of the Memorandum, when
read together with the other information specified therein as being
available for review by investors) omit to state any material fact
necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading.
(x) 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 (including, with respect to any bulk
sale laws), for the execution, delivery and performance of or compliance by
the Seller with this Agreement, or the consummation by the Seller of any
transaction contemplated hereby, other than (1) 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 the
Purchaser, (2) such consents, approvals, authorizations, qualifications,
registrations, filings or notices as have been obtained or made and (3)
where the lack of such consent, approval, authorization, qualification,
registration, filing or notice would not have a material adverse effect on
the performance by the Seller under this Agreement.
(c) Upon discovery by any of the parties hereto of a breach of any of the
representations and warranties made pursuant to and set forth in subsection (b)
above which materially and adversely affects the interests of the Purchaser or a
breach of any of the representations and warranties made pursuant to subsection
(a) above and set forth in EXHIBIT C which materially and adversely affects the
value of any Mortgage Loan or the interests therein of the Purchaser or its
successors and assigns (including, without limitation the Trustee and the
holders of the Certificates), the party discovering such breach shall give
prompt written notice to the other party hereto.
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SECTION 5. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PURCHASER.
The Purchaser, as of the date hereof, hereby represents and warrants to,
and covenants with, the Seller that:
(i) The Purchaser is a corporation duly organized, validly
existing and in good standing under the laws of State of Delaware.
(ii) The execution and delivery of this Agreement by the Purchaser,
and the performance and compliance with the terms of this Agreement by the
Purchaser, will not violate the Purchaser's organizational documents or
constitute a default (or an event which, with notice or lapse of time, or
both, would constitute a default) under, or result in the breach of, any
material agreement or other instrument to which it is a party or which is
applicable to it or any of its assets.
(iii) The Purchaser has the full power and authority to enter into
and consummate all transactions contemplated by this Agreement, has duly
authorized the execution, delivery and performance of this Agreement, and
has duly executed and delivered this Agreement.
(iv) This Agreement, assuming due authorization, execution and
delivery by the Seller, constitutes a valid, legal and binding obligation
of the Purchaser, enforceable against the Purchaser in accordance with the
terms hereof, subject to (A) applicable bankruptcy, insolvency,
reorganization, moratorium and other laws affecting the enforcement of
creditors' rights generally, and (B) general principles of equity,
regardless of whether such enforcement is considered in a proceeding in
equity or at law.
(v) The Purchaser is not in violation of, and its 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, any
order or decree of any court or arbiter, or any order, regulation or demand
of any federal, state or local governmental or regulatory authority, which
violation, in the Purchaser's good faith and reasonable judgment, is likely
to affect materially and adversely either the ability of the Purchaser to
perform its obligations under this Agreement or the financial condition of
the Purchaser.
(vi) No litigation is pending or, to the best of the Purchaser's
knowledge, threatened against the Purchaser which would prohibit the
Purchaser from entering into this Agreement or, in the Purchaser's good
faith and reasonable judgment, is likely to materially and adversely affect
either the ability of the Purchaser to perform its obligations under this
Agreement or the financial condition of the Purchaser.
(vii) The Purchaser has not dealt with any broker, investment
banker, agent or other person, other than the Seller, the Underwriters, the
Initial Purchaser and their respective
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affiliates, that may be entitled to any commission or compensation in
connection with the sale of the Mortgage Loans or the consummation of any
of the transactions contemplated hereby.
(viii) 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 the Purchaser with this Agreement, or the
consummation by the Purchaser of any transaction contemplated hereby, other
than (1) such consents, approvals, authorizations, qualifications,
registrations, filings or notices as have been obtained or made and (2)
where the lack of such consent, approval, authorization, qualification,
registration, filing or notice would not have a material adverse effect on
the performance by the Purchaser under this Agreement.
(b) Upon discovery by any of the parties hereto of a breach of any of the
representations and warranties set forth above which materially and adversely
affects the interests of the Seller, the party discovering such breach shall
give prompt written notice to the other party hereto.
SECTION 6. REPURCHASES.
(a) Within 90 days of the earlier of discovery or receipt of notice by the
Seller, from either the Purchaser or any successor or assign thereof, of a
Defect (as defined in the Pooling and Servicing Agreement as in effect on the
Closing Date) in respect of the Mortgage File for any Mortgage Loan or a breach
of any representation or warranty made pursuant to Section 4(a) and set forth in
EXHIBIT C (a "Breach"), which Defect or Breach, as the case may be, materially
and adversely affects the value of any Mortgage Loan or the interests therein of
the Purchaser or its successors and assigns (including, without limitation, the
Trustee and the holders of the Certificates), the Seller shall cure such Defect
or Breach, as the case may be, in all material respects or repurchase the
affected Mortgage Loan from the then owner(s) thereof at the applicable Purchase
Price (as defined in the Pooling and Servicing Agreement as in effect on the
Closing Date) by payment of such Purchase Price by wire transfer of immediately
available funds to the account designated by such owner(s); provided, however,
that in lieu of effecting any such repurchase, the Seller will be permitted
until the second anniversary of the Closing Date to deliver a Qualifying
Substitute Mortgage Loan and to pay a cash amount equal to the applicable
Substitution Shortfall Amount, subject to the terms and conditions of the
Pooling and Servicing Agreement as in effect on the Closing Date; provided that
in the event of any such Breach with respect to the representation and warranty
set forth at clause (v) of EXHIBIT C or in the last sentence of clause (vi) of
EXHIBIT C, which Breach cannot be corrected or cured in all material respects
within such 90-day period, but it is reasonably likely that such Breach could be
corrected or cured within 180 days of the earlier of discovery by the Seller and
receipt by the Seller of notice of such Breach, and the Seller is diligently
attempting to effect such correction or cure, then the applicable cure period
shall, with the consent of the Purchaser or its assignee (which consent shall
not be unreasonably withheld), be extended for an additional 90 days.
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If the Seller is notified of a Defect in any Mortgage File that corresponds
to information set forth in the Mortgage Loan Schedule, the Seller shall
promptly correct such Defect and provide a new, corrected Mortgage Loan Schedule
to the Purchaser, which corrected Mortgage Loan Schedule shall be deemed to
amend and replace the existing Mortgage Loan Schedule for all purposes.
(b) Notwithstanding Section 6(a), within 60 days of the earlier of
discovery or receipt of notice by the Seller, from either the Purchaser or any
successor or assign thereof, that any Mortgage Loan does not constitute a
"qualified mortgage" within the meaning of Section 860G(a)(3) of the Code, the
Seller shall repurchase such Mortgage Loan from the then owner(s) thereof at the
applicable Purchase Price by payment of such Purchase Price by wire transfer of
immediately available funds to the account designated by such owner(s).
(c) In connection with any repurchase of or substitution for a Mortgage
Loan contemplated by this Section 6, the then owner(s) thereof shall tender or
cause to be tendered promptly to the Seller, upon delivery of a receipt executed
by the Seller, the related Mortgage File and Servicing File, and each document
that constitutes a part of the Mortgage File that was endorsed or assigned to
the Purchaser or the Trustee shall be endorsed or assigned, as the case may be,
to the Seller or its designee in the same manner. The form and sufficiency of
all such instruments and certificates shall be the responsibility of the Seller.
(d) Except as provided in Section 2(b), this Section 6 provides the sole
remedies available to the Purchaser, and its successors and assigns (including,
without limitation, the Trustee and the holders of the Certificates) respecting
any Defect in a Mortgage File or any breach of any representation or warranty
made pursuant to Section 4(a) and set forth in EXHIBIT C, or in connection with
the circumstances described in Section 6(b). If the Seller defaults on its
obligations to repurchase any Mortgage Loan in accordance with Section 6(a) or
6(b) or disputes its obligation to repurchase any Mortgage Loan in accordance
with either such subsection, the Purchaser or its successors and assigns may
take such action as is appropriate to enforce such payment or performance,
including, without limitation, the institution and prosecution of appropriate
proceedings. The Seller shall reimburse the Purchaser for all necessary and
reasonable costs and expenses incurred in connection with such enforcement.
SECTION 7. CLOSING.
The closing of the sale of the Mortgage Loans (the "Closing") shall be held
at the offices of Xxxxx, Xxxxx & Xxxxx, 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000
at 10:00 a.m., New York City time, on the Closing Date.
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The Closing shall be subject to each of the following conditions:
(i) All of the representations and warranties of the Seller
specified herein shall be true and correct as of the Closing Date, and the
Aggregate Cut-off Date Balance shall be within the range permitted by
Section 1 of this Agreement;
(ii) All documents specified in Section 8 (the "Closing
Documents"), in such forms as are agreed upon and acceptable to the
Purchaser, shall be duly executed and delivered by all signatories as
required pursuant to the respective terms thereof;
(iii) The Seller shall have delivered and released to the Trustee,
the Purchaser or the Purchaser's designee, as the case may be, all
documents and funds required to be so delivered pursuant to Section 2;
(iv) The result of any examination of the Mortgage Files and
Servicing Files performed by or on behalf of the Purchaser pursuant to
Section 3 shall be satisfactory to the Purchaser in its sole determination;
(v) 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 the Seller 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;
(vi) The Seller shall have paid or agreed to pay all fees, costs
and expenses payable by it to the Purchaser pursuant to this Agreement; and
(vii) Neither the Underwriting Agreement nor the Certificate
Purchase Agreement shall have been terminated in accordance with its terms.
Both parties agree to use their best efforts to perform their respective
obligations hereunder in a manner that will enable the Purchaser to purchase the
Mortgage Loans on the Closing Date.
SECTION 8. CLOSING DOCUMENTS.
The Closing Documents shall consist of the following:
(a) This Agreement duly executed and delivered by the Purchaser and the
Seller;
(b) An Officer's Certificate substantially in the form of Exhibit D-1
hereto, executed by the Secretary or an assistant secretary of the Seller, and
dated the Closing Date, and upon which the Purchaser and each Underwriter may
rely, attaching thereto as exhibits the organizational documents of the Seller;
11
(c) A certificate of good standing regarding the Seller from the Secretary
of State for the State of Delaware, dated not earlier than 30 days prior to the
Closing Date;
(d) A certificate of the Seller substantially in the form of Exhibit D-2
hereto, executed by an executive officer or authorized signatory of the Seller
and dated the Closing Date, and upon which the Purchaser and each Underwriter
may rely;
(e) Written opinions of counsel for the Seller, substantially in the form
of Exhibits D-3A and D-3B hereto and subject to such reasonable assumptions and
qualifications as may be requested by counsel for the Seller and acceptable to
counsel for the Purchaser, dated the Closing Date and addressed to the Purchaser
and each Underwriter;
(f) Any other opinions of counsel for the Seller reasonably requested by
the Rating Agencies in connection with the issuance of the Certificates, each of
which shall include the Purchaser and each Underwriter as an addressee; and
(g) Such further certificates, opinions and documents as the Purchaser may
reasonably request.
SECTION 9. INDEMNIFICATION.
(a) The Seller agrees to indemnify and hold harmless the Purchaser, its
officers and directors, and each person, if any, who controls the Purchaser
within the meaning of either Section 15 of the Securities Act or Section 20 of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), against
any and all losses, claims, damages or liabilities, joint or several, to which
they or any of them may become subject under the Securities Act, the Exchange
Act or other federal or state statutory law or regulation, at common law or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of a material fact contained in the Prospectus Supplement, the
Memorandum, the Diskette or, insofar as they are required to be filed as part of
the Registration Statement pursuant to the No-Action Letters, any Computational
Materials or ABS Term Sheets with respect to the Registered Certificates, or in
any revision or amendment thereof or supplement thereto, or arise out of or are
based upon the omission or alleged omission (in the case of any such
Computational Materials or ABS Term Sheets, when read in conjunction with the
Prospectus and, in the case of the Memorandum, when read together with the other
information specified therein as being available for review by investors) to
state therein a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading; but only if and to the extent that (i) any such untrue
statement or alleged untrue statement is with respect to information regarding
the Mortgage Loans contained in the Loan Detail or, to the extent consistent
therewith, the Diskette, or (ii) any such untrue statement or alleged untrue
statement or omission or alleged omission is with respect to information
regarding the Seller
12
or the Mortgage Loans contained in the Prospectus Supplement or the Memorandum
under the headings "Summary of Prospectus Supplement - The Mortgage Asset Pool",
"Risk Factors - The Mortgage Loans" and/or "Description of the Mortgage Asset
Pool" or contained on Annex A to the Prospectus Supplement (exclusive of the
Loan Detail), and such information does not represent a restatement or
aggregation of information contained in the Loan Detail; or (iii) such untrue
statement, alleged untrue statement, omission or alleged omission arises out of
or is based upon a breach of the representations and warranties of the Seller
set forth in or made pursuant to Section 4; provided, that the indemnification
provided by this Section 9 shall not apply to the extent that such untrue
statement of a material fact or omission of a material fact necessary to make
the statements made, in light of the circumstances in which they were made, not
misleading, was made as a result of an error in the manipulation of, or
calculations based upon, the Loan Detail. This indemnity agreement will be in
addition to any liability which the Seller may otherwise have.
For purposes of the foregoing, "Registration Statement" shall mean the
registration statement No. 333-37717 filed by the Purchaser on Form S-3,
including without limitation exhibits thereto and information incorporated
therein by reference; "Prospectus" shall mean the prospectus dated December 17,
1997, as supplemented by the prospectus supplement dated August 21, 1998 (the
"Prospectus Supplement"), relating to the Registered Certificates; "Memorandum"
shall mean the private placement memorandum dated August 21, 1998, relating to
the Non-Registered Certificates; "Computational Materials" shall have the
meaning assigned thereto in the no-action letter dated May 20, 1994 issued by
the Division of Corporation Finance of the Securities and Exchange Commission
(the "Commission") to Xxxxxx, Peabody Acceptance Corporation I, Xxxxxx, Xxxxxxx
& Co. Incorporated, and Xxxxxx Structured Asset Corporation and the no-action
letter dated May 27, 1994 issued by the Division of Corporation Finance of the
Commission to the Public Securities Association (together, the "Xxxxxx
Letters"); and "ABS Term Sheets" shall have the meaning assigned thereto in the
no-action letter dated February 17, 1995 issued by the Division of Corporation
Finance of the Commission to the Public Securities Association (the "PSA Letter"
and, together with the Xxxxxx Letters, the "No-Action Letters").
(b) Promptly after receipt by any person entitled to indemnification under
this Section 9 (each, an "indemnified party") of notice of the commencement of
any action, such indemnified party will, if a claim in respect thereof is to be
made against the Seller (the "indemnifying party") under this Section 9, notify
the indemnifying party in writing of the commencement thereof; but the omission
to notify the indemnifying party will not relieve it from any liability that it
may have to any indemnified party otherwise than under this Section 9. In case
any such action is brought against any indemnified party and it notifies the
indemnifying party of the commencement thereof, the indemnifying party will be
entitled to participate therein, and to the extent that it may elect by written
notice delivered to the indemnified party promptly after receiving the aforesaid
notice from such indemnified party, to assume the defense thereof, with counsel
satisfactory to such indemnified party; provided, however, that if the
defendants in any such action include both the indemnified party and the
indemnifying party and the indemnified party or parties shall have reasonably
concluded that there may be legal defenses available to it or them and/or other
indemnified parties that are different
13
from or additional to those available to the indemnifying party, the indemnified
party or parties shall have the right to select separate counsel to assert such
legal defenses and to otherwise participate in the defense of such action on
behalf of such indemnified party or parties. Upon receipt of notice from the
indemnifying party to such indemnified party of its election to assume the
defense of such action and approval by the indemnified party of counsel, which
approval will not be unreasonably withheld, the indemnifying party will not be
liable for any legal or other expenses subsequently incurred by such indemnified
party in connection with the defense thereof, unless (i) the indemnified party
shall have employed separate counsel in connection with the assertion of legal
defenses in accordance with the proviso to the preceding sentence (it being
understood, however, that the indemnifying party shall not be liable for the
expenses of more than one separate counsel, approved by the Purchaser and the
indemnifying party, representing all the indemnified parties under Section 9(a)
who are parties to such action), (ii) the indemnifying party shall not have
employed counsel reasonably satisfactory to the indemnified party to represent
the indemnified party within a reasonable time after notice of commencement of
the action or (iii) the indemnifying party has authorized the employment of
counsel for the indemnified party at the expense of the indemnifying party; and
except that, if clause (i) or (iii) is applicable, such liability shall only be
in respect of the counsel referred to in such clause (i) or (iii).
(c) If the indemnification provided for in this Section 9 is due in
accordance with its terms but is for any reason held by a court to be
unavailable to an indemnified party on grounds of policy or otherwise, then the
indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities, in such proportion as is
appropriate to reflect the relative fault of the indemnified and indemnifying
parties in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative fault of the indemnified and indemnifying parties
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by such parties.
(d) The Purchaser and the Seller agree that it would not be just and
equitable if contribution pursuant to Section 9(c) were determined by pro rata
allocation or by any other method of allocation that does not take account of
the considerations referred to in Section 9(c) above. The amount paid or
payable by an indemnified party as a result of the losses, claims, damages and
liabilities referred to in this Section 9 shall be deemed to include, subject to
the limitations set forth above, any legal or other expenses reasonably incurred
by such indemnified party in connection with investigating or defending any such
action or claim, except where the indemnified party is required to bear such
expenses pursuant to this Section 9, which expenses the indemnifying party shall
pay as and when incurred, at the request of the indemnified party, to the extent
that the indemnifying party will be ultimately obligated to pay such expenses.
If any expenses so paid by the indemnifying party are subsequently determined to
not be required to be borne by the indemnifying party hereunder, the party that
received such payment shall promptly refund the amount so paid to the party
which made such payment. No person guilty of fraudulent misrepresentation
(within the
14
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
(e) The indemnity and contribution agreements contained in this Section 9
shall remain operative and in full force and effect regardless of (i) any
termination of this Agreement, (ii) any investigation made by any indemnified
party, and (iii) acceptance of and payment for any of the Certificates.
SECTION 10. COSTS.
Costs relating to the transactions contemplated hereby shall be borne by
the respective parties hereto in accordance with the Allocation Agreement.
SECTION 11. NOTICES.
All demands, notices and communications hereunder shall be in writing and
shall be deemed to have been duly given if personally delivered to or mailed, by
registered mail, postage prepaid, by overnight mail or courier service, or
transmitted by facsimile and confirmed by a similar mailed writing, if to the
Purchaser, addressed to GMAC Commercial Mortgage Securities, Inc. at 000 Xxxxxxx
Xxxx, X.X. Xxx 0000, Xxxxxxx, Xxxxxxxxxxxx 00000-0000, Attention: Structured
Finance Manager, facsimile no. (000) 000-0000, with a copy to the General
Counsel, GMAC Commercial Mortgage Corporation, or such other address or
facsimile number as may hereafter be furnished to the Seller in writing by the
Purchaser; and if to the Seller, addressed to Xxxxxx Brothers Holdings Inc.,
doing business as Lehman Capital, a Division of Xxxxxx Brothers Holdings Inc.,
at Three World Financial Center, 20th Floor, New York, NY 10288 Attention: Xxxx
Xxxxxxx, facsimile no. (000) 000-0000, or to such other address or facsimile
number as the Seller may designate in writing to the Purchaser.
SECTION 12. THIRD PARTY BENEFICIARIES.
Each of the officers, directors and controlling persons referred to in
Section 9 hereof is an intended third party beneficiary of the covenants and
indemnities of the Seller set forth in Section 9 of this Agreement. It is
acknowledged and agreed that such covenants and indemnities may be enforced by
or on behalf of any such person or entity against the Seller to the same extent
as if it was a party hereto.
SECTION 13. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE
DELIVERY.
All representations, warranties and agreements contained in this Agreement,
incorporated herein by reference or contained in the certificates of officers of
the Seller submitted pursuant hereto, shall remain operative and in full force
and effect and shall survive delivery of the Mortgage Loans by the Seller to the
Purchaser or its designee.
15
SECTION 14. SEVERABILITY OF PROVISIONS.
Any part, provision, representation, warranty or covenant of this Agreement
that is prohibited or which 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 particular
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
particular 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 which prohibits or renders void or
unenforceable any provision hereof.
SECTION 15. COUNTERPARTS.
This Agreement may be executed in any number of counterparts, each of which
shall be deemed to be an original, but all of which together shall constitute
one and the same instrument.
SECTION 16. GOVERNING LAW.
THIS AGREEMENT AND THE RIGHTS, DUTIES, OBLIGATIONS AND RESPONSIBILITIES OF
THE PARTIES HERETO SHALL BE GOVERNED IN ACCORDANCE WITH THE INTERNAL LAWS AND
DECISIONS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES
EXCEPT THAT THE PARTIES HERETO INTEND THAT THE PROVISIONS OF SECTION 5-1401 OF
THE NEW YORK GENERAL OBLIGATIONS LAW SHALL APPLY TO THIS AGREEMENT.
SECTION 17. FURTHER ASSURANCES.
The Seller and the Purchaser agree to execute and deliver such instruments
and take such further actions as the other party may, from time to time,
reasonably request in order to effectuate the purposes and to carry out the
terms of this Agreement.
SECTION 18. SUCCESSORS AND ASSIGNS.
The rights and obligations of the Seller under this Agreement shall not be
assigned by the Seller without the prior written consent of the Purchaser,
except that any person into which the Seller may be merged or consolidated, or
any corporation or other entity resulting from any merger, conversion or
consolidation to which the Seller is a party, or any person succeeding to all or
substantially all of the business of the Seller, shall be the successor to the
Seller hereunder. The Purchaser has the right to assign its interest under this
Agreement, in whole or in part, as may be
16
required to effect the purposes of the Pooling and Servicing Agreement, and the
assignee shall, to the extent of such assignment, succeed to the rights and
obligations hereunder of the Purchaser. Subject to the foregoing, this
Agreement shall bind and inure to the benefit of and be enforceable by the
Seller and the Purchaser, and their permitted successors and assigns, and the
indemnified parties referred to in Section 9.
SECTION 19. AMENDMENTS.
No term or provision of this Agreement may be amended, waived, modified or
in any way altered, unless such amendment, waiver, modification or alteration is
in writing and signed by a duly authorized officer of the party against whom
such amendment, waiver, modification or alteration is sought to be enforced. In
addition, this Agreement may not be changed in any manner which would have a
material adverse effect on any third party beneficiary under Section 12 hereof
without the prior consent of that person.
17
IN WITNESS WHEREOF, the Seller and the Purchaser have caused their names to
be signed hereto by their respective duly authorized officers as of the date
first above written.
XXXXXX BROTHERS HOLDINGS, INC.
By: /s/ Xxxx Xxxxxx
--------------------------------
Name: Xxxx Xxxxxx
------------------------------
Title: Authorized Signatory
-----------------------------
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
By: /s/ Xxxxx Xxxxxxx
--------------------------------
Name: Xxxxx Xxxxxxx
------------------------------
Title: Vice President
-----------------------------
S-1
EXHIBIT A
MORTGAGE LOAN SCHEDULE
The Mortgage Loan Schedule shall set forth, among other things, the
following information with respect to each Mortgage Loan:
(i) the loan number;
(ii) the street address (including city, state and zip code) of the
related Mortgaged Property;
(iii) the Mortgage Rate in effect as of the Cut-off Date and whether
such Mortgage Loan is an Adjustable Rate Mortgage Loan or a
Fixed-Rate Loan;
(iv) the original principal balance;
(v) the Cut-off Date Balance;
(vi) the (A) remaining term to stated maturity (B) with respect to
each ARD Loan, the Anticipated Repayment Date and (C) Stated
Maturity Date;
(vii) the Due Date;
(viii) the amount of the Monthly Payment due on the first Due Date
following the Cut-off Date;
(ix) in the case of an Adjustable Rate Mortgage Loan, the (A)
Index, (B) Gross Margin, (C) first Mortgage Rate adjustment
date following the Cut-off Date and the frequency of Mortgage
Rate adjustments, and (D) maximum and minimum lifetime
Mortgage Rate, if any;
(x) whether such Mortgage Loan is an ARD Loan, a Credit Lease Loan
or a Defeasance Loan;
(xi) the Servicing Fee Rate; and
(xii) the Master Servicing Fee Rate.
A-1
The Mortgage Loan Schedule shall also set forth the aggregate Cut-off Date
Balance for all of the Mortgage Loans. Such list may be in the form of more
than one list, collectively setting forth all of the information required.
A-2
EXHIBIT B
THE MORTGAGE FILE
The "Mortgage File" shall consist of either (a) with respect to any
Mortgage Loan (except any Mortgage Loan subject to a Pass Through Trust
Agreement), subject to Section 2(b), collectively the following documents:
(i) the original Mortgage Note, endorsed by the most recent
endorsee prior to the Trustee or, if none, by the originator,
without recourse, either in blank or to the order of the
Trustee in the following form: "Pay to the order of LaSalle
National Bank, as trustee for the registered holders of GMAC
Commercial Mortgage Securities, Inc., Mortgage Pass-Through
Certificates, Series 1998-C2, without recourse";
(ii) the original or a copy of the Mortgage and, if applicable, the
originals or copies of any intervening assignments thereof
showing a complete chain of assignment from the originator of
the Mortgage Loan to the most recent assignee of record
thereof prior to the Trustee, if any, in each case with
evidence of recording indicated thereon;
(iii) an original assignment of the Mortgage, in recordable form,
executed by the most recent assignee of record thereof prior
to the Trustee or, if none, by the originator, either in blank
or in favor of the Trustee (in such capacity);
(iv) the original or a copy of any related Assignment of Leases (if
such item is a document separate from the Mortgage) and, if
applicable, the originals or copies of any intervening
assignments thereof showing a complete chain of assignment
from the originator of the Mortgage Loan to the most recent
assignee of record thereof prior to the Trustee, if any, in
each case with evidence of recording thereon;
(v) an original assignment of any related Assignment of Leases (if
such item is a document separate from the Mortgage), in
recordable form, executed by the most recent assignee of
record thereof prior to the Trustee or, if none, by the
originator, either in blank or in favor of the Trustee (in
such capacity), which assignment may be included as part of
the corresponding assignment of Mortgage referred to in clause
(iii) above;
B-1
(vi) an original or copy of any related Security Agreement (if such
item is a document separate from the Mortgage) and, if
applicable, the originals or copies of any intervening
assignments thereof showing a complete chain of assignment
from the originator of the Mortgage Loan to the most recent
assignee of record thereof prior to the Trustee, if any;
(vii) an original assignment of any related Security Agreement (if
such item is a document separate from the Mortgage) executed
by the most recent assignee of record thereof prior to the
Trustee or, if none, by the originator, either in blank or in
favor of the Trustee (in such capacity), which assignment may
be included as part of the corresponding assignment of
Mortgage referred to in clause (iii) above;
(viii) originals or copies of all assumption, modification, written
assurance and substitution agreements, with evidence of
recording thereon if appropriate, in those instances where the
terms or provisions of the Mortgage, Mortgage Note or any
related security document have been modified or the Mortgage
Loan has been assumed;
(ix) the original or a copy of the lender's title insurance policy
issued as of the date of the origination of the Mortgage Loan,
together with all endorsements or riders (or copies thereof)
that were issued with or subsequent to the issuance of such
policy, insuring the priority of the Mortgage as a first lien
on the Mortgaged Property;
(x) the original or a copy of any guaranty of the obligations of
the Mortgagor under the Mortgage Loan together with (A) if
applicable, the original or copies of any intervening
assignments of such guaranty showing a complete chain of
assignment from the originator of the Mortgage Loan to the
most recent assignee thereof prior to the Trustee, if any, and
(B) an original assignment of such guaranty executed by the
most recent assignee thereof prior to the Trustee or, if none,
by the originator;
(xi) (A) file or certified copies of any UCC financing statements
and continuation statements which were filed in order to
perfect (and maintain the perfection of) any security interest
held by the originator of the Mortgage Loan (and each assignee
of record prior to the Trustee) in and to the personalty of
the mortgagor at the Mortgaged Property (in each case with
evidence of filing thereon) and which
B-2
were in the possession of the Seller (or its agent) at the
time the Mortgage Files were delivered to the Trustee and (B)
if any such security interest is perfected and the earlier UCC
financing statements and continuation statements were in the
possession of the Seller, a UCC financing statement executed
by the most recent assignee of record prior to the Trustee or,
if none, by the originator, evidencing the transfer of such
security interest, either in blank or in favor of the Trustee;
(xii) the original or a copy of the power of attorney (with evidence
of recording thereon, if appropriate) granted by the Mortgagor
if the Mortgage, Mortgage Note or other document or instrument
referred to above was signed on behalf of the Mortgagor;
(xiii) if the Mortgagor has a leasehold interest in the related
Mortgaged Property, the original ground lease or a copy
thereof; and
(xiv) if the Mortgage Loan is a Credit Lease Loan, an original of
the credit lease enhancement insurance policy, if any,
obtained with respect to such Mortgage Loan and an original of
the residual value insurance policy, if any, obtained with
respect to such Mortgage Loan; or
(b) with respect to each Mortgage Loan subject to a Pass Through Trust
Agreement, the original pass through certificate representing 100% of
the beneficial ownership interest in such Mortgage Loan assigned by
the Seller to the Trustee for the benefit of the Certificateholders.
provided that, in the case of either clause (a) or clause (b), whenever the term
"Mortgage File" is used to refer to documents actually received by the Purchaser
or the Trustee, such term shall not be deemed to include such documents and
instruments required to be included therein unless they are actually so
received. The original assignments referred to in clauses (a) (iii), (a) (v),
(a) (vii) and (a) (x)(B), may be in the form of one or more instruments in
recordable form in any applicable filing offices.
B-3
EXHIBIT C
REPRESENTATIONS AND WARRANTIES OF THE SELLER
REGARDING THE INDIVIDUAL MORTGAGE LOANS
With respect to each Mortgage Loan, the Seller hereby represents and
warrants, as of the date hereinbelow specified or, if no such date is specified,
as of the Closing Date, except as set forth on Schedule C-1 hereto, that:
(i) OWNERSHIP OF MORTGAGE LOANS. Immediately prior to the transfer
thereof to the Purchaser, the Seller had good and marketable title to, and was
the sole owner and holder of, such Mortgage Loan (or, in the case of a Mortgage
Loan subject to a Pass Through Trust Agreement, the related Loan Certificate)
free and clear of any and all liens, encumbrances and other interests on, in or
to such Mortgage Loan (or Loan Certificate) (other than, in certain cases, the
right of a subservicer to directly service such Mortgage Loan). Such transfer
validly assigns ownership of such Mortgage Loan (or, in the case of a Mortgage
Loan subject to a Pass Through Trust Agreement, the related Loan Certificate) to
the Purchaser free and clear of any pledge, lien, encumbrance or security
interest.
(ii) AUTHORITY TO TRANSFER MORTGAGE LOANS. The Seller has full right
and authority to sell, assign and transfer such Mortgage Loan. No provision of
the Mortgage Note, Mortgage or other loan document relating to such Mortgage
Loan prohibits or restricts the Seller's right to assign or transfer such
Mortgage Loan.
(iii) MORTGAGE LOAN SCHEDULE. The information pertaining to such
Mortgage Loan set forth in the Mortgage Loan Schedule was true and correct in
all material respects as of the Cut-off Date.
(iv) PAYMENT RECORD. Such Mortgage Loan was not as of the Cut-off
Date for such Mortgage Loan, and has not been during the twelve-month period
prior thereto, 30 days or more delinquent in respect of any debt service payment
required thereunder, without giving effect to any applicable grace period.
(v) PERMITTED ENCUMBRANCES. The related Mortgage constitutes a valid
first lien upon the related Mortgaged Property, including all buildings located
thereon and all fixtures attached thereto, such lien being subject only to (A)
the lien of current real property taxes and assessments not yet due and payable,
(B) covenants, conditions and restrictions, rights of way, easements and other
matters of public record, and (C) exceptions and exclusions specifically
referred to in the lender's title insurance policy issued or, as evidenced by a
"marked-up" commitment, to be issued in respect of such Mortgage Loan (the
exceptions set forth in the foregoing clauses (A), (B) and (C) collectively,
"Permitted Encumbrances"). The Permitted Encumbrances do not materially
interfere with the security intended to be provided by the related Mortgage, the
current use or operation of the
C-1
related Mortgaged Property or the current ability of the Mortgaged Property to
generate net operating income sufficient to service the Mortgage Loan. If the
Mortgaged Property is operated as a nursing facility, a hospitality property or
a multifamily property, the Mortgage, together with any separate security
agreement, similar agreement and UCC financing statement, if any, establishes
and creates a first priority, perfected security interest (subject only to any
prior purchase money security interest), to the extent such security interest
can be perfected by the recordation of a Mortgage or the filing of a UCC
financing statement, in all personal property owned by the Mortgagor that is
used in, and is reasonably necessary to, the operation of the related Mortgaged
Property.
(vi) TITLE INSURANCE. The lien of the related Mortgage is insured by
an ALTA lender's title insurance policy ("Title Policy"), or its equivalent as
adopted in the applicable jurisdiction, issued by a nationally recognized title
insurance company, insuring the originator of such Mortgage Loan, its successors
and assigns, as to the first priority lien of the Mortgage in the original
principal amount of the Mortgage Loan after all advances of principal, subject
only to Permitted Encumbrances (or, if a title insurance policy has not yet been
issued in respect of the Mortgage Loan, a policy meeting the foregoing
description is evidenced by a commitment for title insurance "marked-up" at the
closing of such loan). 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, to the Seller's knowledge, no material claims have
been made thereunder and no claims have been paid thereunder. The Seller has
not, by act or omission, done 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 the Seller's
actual knowledge, the insurer that issued such Title Policy is qualified to do
business in the state in which the related Mortgaged Property is located.
(vii) NO WAIVERS BY SELLER OF MATERIAL DEFAULTS. The Seller has not
waived any material default, breach, violation or event of acceleration existing
under the related Mortgage or Mortgage Note.
(viii) NO OFFSETS, DEFENSES OR COUNTERCLAIMS. There is no valid
offset, defense or counterclaim to such Mortgage Loan.
(ix) CONDITION OF PROPERTY; CONDEMNATION. Except as set forth in any
engineering report prepared in connection with the origination of (or obtained
in connection with or otherwise following the Seller's acquisition of) such
Mortgage Loan, the related Mortgaged Property is, to the Seller's knowledge,
free and clear of any damage that would materially and adversely affect its
value as security for such Mortgage Loan. The Seller has no actual notice of
the commencement of a proceeding for the condemnation of all or any material
portion of the related Mortgaged Property.
(x) COMPLIANCE WITH USURY LAWS. Such Mortgage Loan complied with all
applicable usury laws in effect at its date of origination.
C-2
(xi) FULL DISBURSEMENT OF MORTGAGE LOAN PROCEEDS. The proceeds of
such Mortgage Loan have been fully disbursed and there is no requirement for
future advances thereunder.
(xii) ENFORCEABILITY. The related Mortgage Note and Mortgage and all
other documents and instruments evidencing, guaranteeing, insuring or otherwise
securing such Mortgage Loan have been duly and properly executed by the parties
thereto, and each 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 legislation),
enforceable in accordance with its terms, except as such enforcement may be
limited by bankruptcy, insolvency, reorganization, receivership, moratorium or
other laws relating to or affecting the rights of creditors generally and by
general principles of equity (regardless of whether such enforcement is
considered in a proceeding in equity or at law).
(xiii) INSURANCE. Except in the case of a Credit Lease Loan that
permits the related Tenant to self-insure, all improvements upon the related
Mortgaged Property are insured against loss by hazards of extended coverage in
an amount (subject to a customary deductible) at least equal to the lesser of
the outstanding principal balance of such Mortgage Loan and 100% of the full
insurable value of the improvements located on such Mortgaged Property, and the
related hazard insurance policy contains appropriate endorsements to avoid the
application of co-insurance provisions and does not permit reduction in
insurance proceeds for depreciation. If any portion of the related Mortgaged
Property was, at the time of the origination of such Mortgage Loan, in an area
identified in the Federal Register by the Federal Emergency Management Agency as
having special flood hazards, and flood insurance was available, a flood
insurance policy meeting any requirements of the then current guidelines of the
Federal Insurance Administration is in effect with a generally acceptable
insurance carrier, in an amount representing coverage not less than the least of
(1) the outstanding principal balance of such Mortgage Loan, (2) the full
insurable value of such Mortgaged Property, (3) the maximum amount of insurance
available under the National Flood Insurance Act of 1968, as amended, and (4)
100% of the replacement cost of the improvements located on such Mortgaged
Property. In addition, except in the case of a Credit Lease Loan that permits
the related Tenant to self-insure, the Mortgage requires the Mortgagor to
maintain in respect of the Mortgaged Property comprehensive general liability
insurance in amounts generally required by the Seller, and at least six months
rental or business interruption insurance, and all such insurance required by
the Mortgage to be maintained is in full force and effect. Each such insurance
policy requires prior notice to the holder of the Mortgage of termination or
cancellation, and no such notice has been received, including any notice of
nonpayment of premiums, that has not been cured.
(xiv) ENVIRONMENTAL CONDITION. The related Mortgaged Property was
subject to one or more environmental site assessments (or an update of a
previously conducted assessment), which was (were) performed on behalf of the
Seller, or as to which the related report was delivered to the Seller in
connection with its origination or acquisition of such Mortgage Loan; and the
Seller, having made no independent inquiry other than reviewing the resulting
report(s) and/or employing an
C-3
environmental consultant to perform the assessment(s) referenced herein, has no
knowledge of any material and adverse environmental conditions or circumstance
affecting such Mortgaged Property that was not disclosed in the related
report(s). To the Seller's knowledge, the Seller has not taken any action with
respect to such Mortgage Loan or the related Mortgaged Property that could
subject the Purchaser, or its successors and assigns in respect of the Mortgage
Loan, to any liability under the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended ("CERCLA") or any other
applicable federal, state or local environmental law, and the Seller has not
received any actual notice of a material violation of CERCLA or any applicable
federal, state or local environmental law with respect to the related Mortgaged
Property that was not disclosed in the related report. The related Mortgage or
loan documents in the related Mortgage File requires the Mortgagor to comply
with all applicable federal, state and local environmental laws and regulations.
(xv) NO CROSS-COLLATERALIZATION WITH OTHER MORTGAGE LOANS. Such
Mortgage Loan is not cross-collateralized with any mortgage loan that will not
be included in the Trust Fund.
(xvi) WAIVERS AND MODIFICATIONS. The terms of the related Mortgage
and the Mortgage Note have not been impaired, waived, altered or modified in any
material respect, except as specifically set forth in the related Mortgage File.
(xvii) TAXES AND ASSESSMENTS. There are no delinquent taxes, ground
rents, assessments for improvements or other similar outstanding charges
affecting the related Mortgaged Property which 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 and/or penalties would
be payable thereon.
(xviii) MORTGAGOR'S INTEREST IN MORTGAGED PROPERTY. Except in the
case of four Mortgage Loans as to which the interest of the related Mortgagor
in the related Mortgaged Property is in whole or in part a leasehold estate, the
interest of the related Mortgagor in the related Mortgaged Property consists of
a fee simple estate in real property.
(xix) WHOLE LOAN. Except for the Pass Through Loans, each Mortgage
Loan is a whole loan and not a participation interest.
(xx) VALID ASSIGNMENT. The assignment of the related Mortgage
referred to in clause (iii) of EXHIBIT B constitutes the legal, valid and
binding assignment of such Mortgage from the relevant assignor to the Trustee.
The Assignment of Leases set forth in the Mortgage or separate from the related
Mortgage and related to and delivered in connection with each Mortgage Loan
establishes and creates a valid, subsisting and, subject only to Permitted
Encumbrances, enforceable first priority lien and first priority security
interest in the related Mortgagor's interest in all leases, subleases, 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
C-4
thereunder has the full right to assign the same. The related assignment of any
Assignment of Leases, not included in a 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 Assignment of
Leases.
(xxi) ESCROWS. All escrow deposits relating to such Mortgage Loan
that are, as of the Closing Date, required to be deposited with the mortgagee or
its agent have been so deposited.
(xxii) NO MECHANICS' OR MATERIALMEN'S LIENS. As of the date of
origination of such Mortgage Loan and, to the actual knowledge of the Seller, as
of the Closing Date, the related Mortgaged Property was and is free and clear of
any mechanics' and materialmen's liens or liens in the nature thereof which
create a lien prior to that created by the related Mortgage, except those which
are insured against by the Title Policy referred to in (vi) above.
(xxiii) NO MATERIAL ENCROACHMENTS. To the Seller's knowledge (based
on surveys and/or title insurance obtained in connection with the origination of
such Mortgage Loan), as of the date of such origination, no improvement that was
included for the purpose of determining the appraised value of the related
Mortgaged Property at the time of origination of such Mortgage Loan lay outside
the boundaries and building restriction lines of such property to any material
extent (unless affirmatively covered by the title insurance referred to in
paragraph (vi) above), and no improvements on adjoining properties encroached
upon such Mortgaged Property to any material extent. To the Seller's knowledge,
based upon opinions of counsel and/or other due diligence customarily performed
by the Seller, the improvements located on or forming part of such Mortgaged
Property comply in all material respects with applicable zoning laws and
ordinances (except to the extent that they may constitute legal non-conforming
uses).
(xxiv) ORIGINATOR AUTHORIZED. To the extent required under
applicable law as of the Closing Date, the originator of such Mortgage Loan was
authorized to do business in the jurisdiction in which the related Mortgaged
Property is located at all times when it held the Mortgage Loan to the extent
necessary to ensure the enforceability of such Mortgage Loan.
(xxv) NO MATERIAL DEFAULT. (A) To the Seller's knowledge, there
exists no material default, breach or event of acceleration under the related
Mortgage or Mortgage Note, and (B) the Seller has not received actual notice of
any event (other than payments due but not yet delinquent) that, with the
passage of time or with notice and the expiration of any grace or cure period,
would constitute such a material default, breach or event of acceleration;
provided, however, that this representation and warranty does not cover any
default, breach or event of acceleration that specifically pertains to any
matter otherwise covered or addressed by any other representation and warranty
made by the Seller herein.
C-5
(xxvi) INSPECTION. In connection with the origination or acquisition
of each Mortgage Loan, the Seller inspected or caused to be inspected the
Mortgaged Property.
(xxvii) NO EQUITY PARTICIPATION OR CONTINGENT INTEREST. The Mortgage
Loan contains no equity participation by the lender, and does not provide for
any contingent or additional interest in the form of participation in the cash
flow of the related Mortgaged Property, or for negative amortization.
(xxviii) NO ADVANCES OF FUNDS. No holder of the Mortgage Loan has,
to the Seller's knowledge, 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 the Mortgage Loan.
(xxix) LICENSES, PERMITS, ETC. To the Seller's knowledge, based on
due diligence customarily performed in the origination of comparable mortgage
loans by the Seller, as of the date of origination of the Mortgage Loan, the
related Mortgagor or operator of the related Mortgaged Property was in
possession of all material licenses, permits and authorizations required by
applicable laws for the ownership and operation of the related Mortgaged
Property as it was then operated and if a related Mortgaged Property is improved
by a skilled nursing, congregate care or assisted living facility, the most
recent inspection or survey by governmental authorities having jurisdiction in
connection with such licenses, permits and authorizations did not cite such
Mortgaged Property for material violations (which shall include only "Level A"
(or equivalent) violations in the case of skilled nursing facilities) that had
not been cured or as to which a plan of correction had not been submitted to and
accepted by such governmental authorities. To the extent such facility
participates in Medicaid or Medicare, such facility is in compliance in all
material respects with the requirements of such program.
(xxx) SERVICING. The servicing and collection practices used with
respect to the Mortgage Loan have complied with applicable law in all material
respects and are consistent with customary servicing practices of institutional
servicers of mortgage loans such as the Mortgage Loans.
(xxxi) CUSTOMARY REMEDIES. The related Mortgage or Mortgage Note,
together with applicable state law, contains customary and enforceable
provisions (subject to the exceptions set forth in paragraph (xii)) such as to
render the rights and remedies of the holders thereof adequate for the practical
realization against the related Mortgaged Property of the principal benefits of
the security intended to be provided thereby.
(xxxii) INSURANCE AND CONDEMNATION PROCEEDS. The related Mortgage
provides that insurance proceeds and condemnation proceeds will be applied for
one of the following purposes: either to restore or repair the Mortgaged
Property, or to repay the principal of the Mortgage Loan, or otherwise at the
option of the holder of the Mortgage.
C-6
(xxxiii) LTV. The gross proceeds of such 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 (1) at the date the Mortgage Loan
was originated at least equal to 80 percent of the original principal balance of
the Mortgage Loan or (2) 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 (1) and (2) of this paragraph (xxxiii) 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 which 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)).
(xxxiv) LTV AND SIGNIFICANT MODIFICATIONS. If the Mortgage Loan was
"significantly modified" prior to the Closing Date so as to result in a taxable
exchange under Section 1001 of the Code, it either (A) was modified as a result
of the default or reasonably foreseeable default of such Mortgage Loan or (B)
satisfies the provisions of either clause (A)(1) of paragraph (xxxiii)
(substituting the date of the last such modification for the date the Mortgage
Loan was originated) or clause (A)(2) of paragraph (xxxiii), including the
proviso thereto.
(xxxv) CREDIT LEASE LOANS. With respect to each Mortgage Loan that is
a Credit Lease Loan;
(A) To the Seller's knowledge, each credit lease ("Credit Lease")
contains customary and enforceable provisions which render the
rights and remedies of the lessor thereunder adequate for the
enforcement and satisfaction of the lessor's rights
thereunder;
(B) To the Seller's knowledge, in reliance on a tenant estoppel
certificate and representation made by the tenant under the
Credit Lease or representations made by the related borrower
under the Mortgage Loan documents, as of the closing date of
each Credit Lease Loan (1) each Credit Lease was in full force
and effect, and no default by the borrower or the tenant has
occurred under the Credit Lease, nor is there any existing
condition which, but for the passage of time or the giving of
notice, or both, would result in a default under the terms of
the Credit Lease, (2) none of the terms of the Credit Lease
have been impaired, waived, altered or modified in any respect
(except as
C-7
described in the related tenant estoppel), (3) no tenant has
been released, in whole or in part, from its obligations under
the Credit Leases, (4) there is no right of rescission,
offset, abatement, diminution, defense or counterclaim to any
Credit Lease, nor will the operation of any of the terms of
the Credit Leases, or the exercise of any rights thereunder,
render the Credit Lease unenforceable, in whole or in part, or
subject to any right of rescission, offset, abatement,
diminution, defense or counterclaim, and no such right of
rescission, offset, abatement, diminution, defense or
counterclaim has been asserted with respect thereto, and (5)
each Credit Lease has a term ending on or after the final
maturity of the related Credit Lease Loan;
(C) The Mortgaged Property is not subject to any lease other than
the related Credit Lease, no Person has any possessory
interest in, or right to occupy, the Mortgaged Property except
under and pursuant to such Credit Lease and the tenant under
the related Credit Lease is in occupancy of the Mortgaged
Property;
(D) The mortgagee is entitled to notice of any event of default
from the tenant under Credit Leases;
(E) Each tenant under a Credit Lease is required to make all
rental payments directly to the mortgagee, its successors and
assigns under the related Credit Lease Loan;
(F) Each Credit Lease Loan provides that the related Credit Lease
cannot be modified without the consent of the mortgagees under
the related Credit Lease Loan;
(G) Except with respect to the Mortgage Loans listed on Schedule
C-1 hereto, the lease payments due under the related Credit
Lease, together with any escrow payments held by the Seller or
its designee, are equal to or greater than the payments due
with respect to the related Mortgage Loan;
(H) Except with respect to Credit Lease Loans listed on Schedule
C-1 hereto, the Mortgagor does not have monetary obligations
under the related Credit Lease, and every monetary obligation
associated with managing, owning, developing and operating the
leased property, including, but not limited to, the costs
associated with utilities, taxes, insurance, maintenance and
repairs is an obligation of the related Tenant;
(I) The Mortgagor does not have any nonmonetary obligations under
the related Credit Lease, except for the delivery of
possession of the leased property;
C-8
(J) Except with respect to Credit Lease Loans listed on Schedule
C-1 hereto, the Mortgagor has not made any representation or
warranty in the related Credit Lease, a breach of which would
result in the termination of, or an offset or abatement with
respect to, such Credit Lease;
(K) Except with respect to Credit Lease Loans listed on Schedule
C-1 hereto, the related Tenant cannot terminate such Credit
Lease for any reason prior to the payment in full of: (a) the
principal balance of the related Mortgage Loan; (b) all
accrued and unpaid interest on such Mortgage Loan; and (c) any
other sums due and payable under such Mortgage Loan, as of the
termination date, which date is a rent payment date, except
for a default by the related Mortgagor under the Credit Lease
or due to a casualty or condemnation event, in which case, a
lease enhancement policy insures against such risk;
(L) In the event the related Tenant assigns or sublets the related
leased property, such Tenant (and if applicable, the related
guarantor) remains obligated under the related Credit Lease;
(M) Except with respect to Credit Lease Loans listed on Schedule
C-1 hereto, each property related to a Credit Lease Loan is a
separate tax lot;
(N) The related Tenant has agreed to indemnify the Mortgagor from
any claims of any nature (a) to which the Mortgagor is subject
because of such Mortgagor's estate in the leased property, or
(b) arising from (i) injury to or death of any person or
damage to or loss of property on the leased property or
connected with the use, condition or occupancy of the leased
property, (ii) Tenant's violation of the related Credit Lease,
or (iii) any act or omission of the Tenant;
(O) Except with respect to the Mortgage Loans listed on Schedule
C-1 hereto, related Tenant has agreed to indemnify the
Mortgagor from any claims of any nature arising as a result of
any hazardous material affecting the leased property and due
to such Tenant's use of the leased property;
(P) In connection with the Credit Lease Loans with respect to
which a Guaranty exists, the related guarantor guarantees the
payment due under the related Credit Lease and such Guaranty,
on its face, contains no conditions to such payment;
(Q) Except with respect to Credit Lease Loans that have the
benefit of residual value insurance policies and lease
enhancement policies, each such policy has
C-9
been obtained and with respect to the Credit Leases other than
bond-type leases, the required premiums have been paid; and
(R) The list of lease guarantors listed on Schedule C-1 hereto,
is accurate in all material respects.
(xxxvi) LITIGATION. To the Seller's actual knowledge, there are no
pending actions, suits or proceedings by or before any court or governmental
authority against or affecting the related Mortgagor or the related Mortgaged
Property that, if determined adversely to such Mortgagor or Mortgaged Property,
would materially and adversely affect the value of the Mortgaged Property or the
ability of the Mortgagor to pay principal, interest or any other amounts due
under such Mortgage Loan.
(xxxvii) LEASEHOLD ESTATE. Each Mortgaged Property consists of the
related Mortgagor's 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
Mortgagor's interest in the Ground Lease but not by the related fee interest in
such Mortgaged Property (the "Fee Interest") or if the Mortgage Loan is secured
in whole or in part by a Ground Lease and a Fee Interest, either (1) the ground
lessor's fee interest is subordinated to the lien of the Mortgage or (2) the
following apply to such Ground Lease:
(A) To the actual knowledge of the Seller, 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 the Seller and related lessor)
permits 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;
(B) 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 the ground lessor's
related fee interest and Permitted Encumbrances;
(C) The Mortgagor's interest in such Ground Lease is assignable to
the 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, it is further
assignable by the Purchaser and its successors and assigns
upon notice to, but without the need to obtain the consent of,
such lessor (or if such consent is required, it cannot be
unreasonably withheld);
C-10
(D) Such Ground Lease is in full force and effect, and the Seller
has received no notice that an event of default has occurred
thereunder, and, to the Seller's actual 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;
(E) Such Ground Lease, or an estoppel letter or other agreement,
requires the lessor under such Ground Lease to give notice of
any default by the lessee to the mortgagee under such Mortgage
Loan, provided that the mortgagee has provided the lessor with
notice of its lien in accordance with the provisions of such
Ground Lease, and such Ground Lease, or an estoppel letter or
other agreement, further provides that no notice of
termination given under such Ground Lease is effective against
the mortgagee unless a copy has been delivered to the
mortgagee;
(F) The mortgagee under such Mortgage Loan 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;
(G) Such Ground Lease has an original term (including any
extension options set forth therein) which extends not less
than ten years beyond the Stated Maturity Date of the related
Mortgage Loan;
(H) Under the terms of such Ground Lease (or an estoppel letter or
other agreement) and the related Mortgage, taken together,
any related insurance proceeds other than in respect of a
total or substantially total loss or taking, will be applied
either to the repair or restoration of all or part of the
related Mortgaged Property, with the mortgagee under such
Mortgage Loan or a trustee appointed by it having the right to
hold and disburse such proceeds (if they are in excess of a
specified amount) as the repair or restoration progresses
(except in such cases where a provision entitling another
party to hold and disburse such proceeds would not be viewed
as commercially unreasonable by a prudent commercial mortgage
lender), or to the payment of the outstanding principal
balance of the Mortgage Loan together with any accrued
interest thereon;
(I) Except for the reasonable consent of the ground lessor, such
Ground Lease does not impose any restrictions on subletting
which would be viewed, as of the date of origination of the
related Mortgage Loan, as commercially
C-11
unreasonable by the Seller (although there may be general
limitations on the use of the Mortgaged Property);
(J) 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 related Mortgagor, or in any manner, which
would materially adversely affect the security provided by the
related Mortgage; and
(K) Such Ground Lease, or an estoppel letter or other agreement,
requires the lessor to enter into a new lease in the event of
a termination of the Ground Lease by reason of a default by
the Mortgagor under the Ground Lease, including, rejection of
the ground lease in a bankruptcy proceeding.
(xxxviii) DEED OF TRUST. If the related Mortgage is a deed of trust,
a trustee, duly qualified under applicable law to serve as such, is properly
designated and serving under such Mortgage.
(xxxix) LIEN RELEASES. Except in cases where either (a) a release of
a portion of the Mortgaged Property was contemplated at origination of the
Mortgage Loan and such portion was not considered material for purposes of
underwriting the Mortgage Loan or (b) release is conditioned upon the
satisfaction of certain underwriting and legal requirements and the payment of a
release price, the related Mortgage Note or Mortgage does not require the holder
thereof to release all or any portion of the Mortgaged Property from the lien of
the related Mortgage except upon payment in full of all amounts due under such
Mortgage Loan.
(xl) JUNIOR LIENS. The Mortgage Loan does not permit the related
Mortgaged Property to be encumbered by any lien junior to or of equal priority
with the lien of the related Mortgage (excluding any lien relating to another
Mortgage Loan that is cross-collateralized with such Mortgage Loan) without the
prior written consent of the holder thereof or the satisfaction of debt service
coverage or similar conditions specified therein.
(xli) MORTGAGOR BANKRUPTCY. To the Seller's knowledge, the Mortgagor
is not a debtor in any state or federal bankruptcy or insolvency proceeding.
(xlii) DUE ORGANIZATION OF MORTGAGORS. As of the date of origination
of each Mortgage, each related Mortgagor which is not a natural person was duly
organized and validly existing under the laws of the state of its jurisdiction.
(xliii) DUE-ON-SALE. The Mortgage Loan contains provisions for the
acceleration of the payment of the unpaid principal balance of such Mortgage
Loan if, without complying with the requirements of such Mortgage Loan, the
related Mortgaged Property, or any controlling interest therein, is directly or
indirectly transferred or sold.
(xliv) SINGLE PURPOSE ENTITY. Except for Mortgage Loans each of which
represent less than 2.0% of $2,530,361,727, the Mortgagor is an entity, other
than an individual, whose organizational documents or the related Mortgage Loan
Documents provide substantially to the effect that the Mortgagor: (A) is formed
or organized solely for the purpose of owning and operating one or more of the
Mortgaged Properties securing the Mortgage Loans, (B) may not engage in any
business unrelated to such Mortgaged Property or Mortgaged Properties, (C) does
not have any material assets other than those related to its interest in and
operation of such Mortgage Property or Mortgaged Properties, (D) may not incur
indebtedness other than as permitted by the related Mortgage or other Mortgage
Loan Documents, (E) has its own books and records separate and apart from any
other person, and (F) holds itself out as a legal entity, separate and apart
from any other person.
(xlv) DEFEASANCE PROVISIONS. Any Mortgage Loan which contains a
provision for any defeasance of mortgage collateral either (A) requires the
consent of the holder of the Mortgage Loan to any defeasance, or (B) permits
defeasance (i) no earlier than two years after the Closing Date (as defined in
the Pooling and Servicing Agreement, dated as of August 1, 1998), (ii) only with
substitute collateral constituting "government securities" within the meaning of
Treas. Reg. Section 1.860G-2(a)(8)(i), and (iii) only to facilitate the
disposition of mortgage real property and not as a part of an arrangement to
collateralize a REMIC offering with obligations that are not real estate
mortgages.
It is understood and agreed that the representations and warranties set
forth in this EXHIBIT C shall survive delivery of the respective Mortgage Files
to the Purchaser and/or the Trustee and shall inure to the benefit of the
Purchaser, and its successors and assigns (including without limitation the
Trustee and the holders of the Certificates), notwithstanding any restrictive or
qualified endorsement or assignment.
C-13
SCHEDULE C-1 TO EXHIBIT C
REPRESENTATIONS AND WARRANTIES EXCEPTIONS
(vi) TITLE INSURANCE
CONTROL NO. LOAN NUMBER PROPERTY
3j LG980424002J Xxxxxx
(Doubletree-Omaha)
(xxii) NO MECHANICS' OR MATERIALMEN'S LIENS
CONTROL NO. LOAN NUMBER PROPERTY ISSUE
23 970815023 Xxxxxxxxxx Retail Lien present,
Center but bonded
(xiv) ENVIRONMENTAL CONDITION
CONTROL NO. LOAN NUMBER PROPERTY
44 980701999 Sam's Wholesale Club
50 980601999C Circuit City
68 980601999D Circuit City
72 980601999B Circuit City
98 9806019991 Circuit City
99 980601999F Circuit City
110 980601999A Circuit City
122 980601999G Circuit City
181 980601999H Circuit City
221 980601999E Circuit City
C-14
(xix) WHOLE LOAN
The following Mortgage Loans are Pass Through Loans represented by a
Loan Certificate.
CONTROL NO. LOAN NUMBER PROPERTY
50 980601999C Circuit City
68 980601999D Circuit City
72 980601999B Circuit City
98 980601999I Circuit City
99 980601999F Circuit City
110 980601999A Circuit City
122 980601999G Circuit City
181 980601999H Circuit City
221 980601999E Circuit City
(xxxv) CREDIT LEASE LOANS
(G)
CONTROL NO. LOAN NUMBER PROPERTY
143 971217004 Walgreen
156 970924009 Xxxxxx Xxx Xxxxxxx
000 000000000 Xxxxxxxxx - Xxxxxxxx
187 971107007 Walgreen (Dallas)
245 971222008 Walgreen's (Xxxxxxxxxxxx)
257 971030017 Eckerd - Baton Rouge
C-15
(H)
CONTROL NO. LOAN NUMBER PROPERTY
87 980204001 Shop 'N Save
(Hannaford Brothers)
143 971217004 Walgreen
164 970819000 Walgreens
171 970802003 Walgreens - Richmond
187 971107007 Walgreen (Dallas)
244 980127001 Walgreens (Shawnee)
245 971222008 Walgreen's (Xxxxxxxxxxxx)
255 980212001 Eckerd Pharmacy
(Corpus Christi)
351 970530002 Rite Aid - Walcott
369 980127004C XXXX
000 000000000 Xxxxxxxxx - Xxxxxxxx
(X)
CONTROL NO. LOAN NUMBER PROPERTY
44 980701999 Sam's Wholesale Club
87 980204001 Shop 'N Save
(Hannaford Brothers)
143 971217004 Walgreen
164 970819000 Walgreens
171 970802003 Walgreens - Richmond
187 971107007 Walgreen (Dallas)
245 971222008 Walgreen's (Xxxxxxxxxxxx)
C-16
CONTROL NO. LOAN NUMBER PROPERTY
255 980212001 Eckerd Pharmacy
(Corpus Christi)
377 971201019 Southland - Lakecity
(K)
CONTROL NO. LOAN NUMBER PROPERTY
44 980701999 Sam's Wholesale Club
(M)
CONTROL NO. LOAN NUMBER PROPERTY
257 971030017 Eckerd - Baton Rouge
(O)
CONTROL NO. LOAN NUMBER PROPERTY
44 980701999 Sam's Wholesale Club
50 980601999C Circuit City
156 970924009 Xxxxxx Xxx Xxxxxxx
000 000000000 Xxxxxxxxx - Xxxxxxxx
244 980127001 Walgreens (Shawnee)
255 980212001 Eckerd Pharmacy
(Corpus Christi)
257 971030017 Xxxxxx - Xxxxx Xxxxx
000 000000000 Xxxxxxxxx - Xxxxxxxx
C-17
(R)
CONTROL NO. LOAN NUMBER PROPERTY LEASE GUARANTOR
44 980701999 Sam's Wholesale Wal-Mart Stores,
Club Inc.
87 980204001 Shop 'N Save Hanaford Bros. Co.
(Hannaford Brothers)
143 971217004 Walgreen Walgreen Co.
164 970819000 Walgreens Walgreen Co.
351 970530002 Rite Aid - Walcott Rite Aid Corp.
369 980127004C IHOP IHOP Corp.
(xxxvii) LEASEHOLD ESTATE
(B)
CONTROL NO. LOAN NUMBER PROPERTY
3j LG980424002J Xxxxxx
(Doubletree - Omaha)
(C)
CONTROL NO. LOAN NUMBER PROPERTY
3j LG980424002J Xxxxxx
(Doubletree - Omaha)
(E)
CONTROL NO. LOAN NUMBER PROPERTY
58 980204038 New Harbour Mall
C-18
(xl) JUNIOR LIENS
CONTROL NO. LOAN NUMBER PROPERTY
6 971120012 The Bellevue
138 980401012 000 Xxxx Xxx. Xx
294 971223029 Xxxxxx Xxxxx Xxxxxxxxxx
X-00
XXXXXXX X-0
FORM OF CERTIFICATE OF AN OFFICER OF
THE SELLER
CERTIFICATE OF OFFICER OF XXXXXX BROTHERS HOLDINGS INC. ("LB HOLDINGS")
I, _________________, a _________________ of Xxxxxx Brothers Holdings Inc.,
doing business as Xxxxxx Capital, a Division of Xxxxxx Brothers Holdings Inc.,
(the "Seller"), hereby certify as follows:
The Seller is a corporation duly organized and validly existing under the
laws of the State of Delaware.
Attached hereto as EXHIBIT I are true and correct copies of the Certificate
of Incorporation and By-Laws of the Seller, which Certificate of Incorporation
and By-Laws are on the date hereof, and have been at all times in full force and
effect.
To the best of my knowledge, no proceedings looking toward liquidation or
dissolution of the Seller are pending or contemplated.
Each person listed below is and has been the duly elected and qualified
officer or authorized signatory of the Seller and his genuine signature is set
forth opposite his name:
Name Office Signature
---- ------ ---------
Each person listed above who signed, either manually or by facsimile
signature, the Mortgage Loan Purchase Agreement, dated as of August 21, 1998
(the "Purchase Agreement"), between the Seller and GMAC Commercial Mortgage
Securities, Inc. providing for the purchase by GMAC Commercial Mortgage
Securities, Inc. from the Seller of the Mortgage Loans, was, at the respective
times of such signing and delivery, duly authorized or appointed to execute such
documents in such capacity, and the signatures of such persons or facsimiles
thereof appearing on such documents are their genuine signatures.
Capitalized terms not otherwise defined herein have the meanings assigned
to them in the Purchase Agreement.
D-1
IN WITNESS WHEREOF, the undersigned has executed this certificate as of
August _ __, 1998.
By:
--------------------------------
Name:
------------------------------
Title:
-----------------------------
I, [name], [title], hereby certify that ________________ is a duly elected
or appointed, as the case may be, qualified and acting ______________ of the
Seller and that the signature appearing above is [his] genuine signature.
IN WITNESS WHEREOF, the undersigned has executed this certificate as of
August _ __, 1998.
By:
--------------------------------
Name:
------------------------------
Title:
-----------------------------
X-0
XXXXXXX X-0
FORM OF CERTIFICATE OF THE SELLER
CERTIFICATE OF XXXXXX BROTHERS HOLDINGS, INC.
In connection with the execution and delivery by Xxxxxx Brothers Holdings,
Inc., doing business as Xxxxxx Capital, a Division of Xxxxxx Brothers Holdings
Inc., (the "Seller") of, and the consummation of the transaction contemplated
by, that certain Mortgage Loan Purchase Agreement, dated as of August 21, 1998
(the "Purchase Agreement"), between GMAC Commercial Mortgage Securities, Inc.
and the Seller, the Seller hereby certifies that (i) the representations and
warranties of the Seller in the Purchase Agreement are true and correct in all
material respects at and as of the date hereof with the same effect as if made
on the date hereof, and (ii) the Seller has, in all material respects, complied
with all the agreements and satisfied all the conditions on its part to be
performed or satisfied at or prior to the date hereof. Capitalized terms not
otherwise defined herein have the meanings assigned to them in the Purchase
Agreement.
Certified this ___th day of August, 1998.
XXXXXX BROTHERS HOLDINGS INC.
By:
--------------------------------
Name:
------------------------------
Title:
-----------------------------
D-3
EXHIBIT D-3A
FORM OF OPINION I OF COUNSEL TO THE SELLER
August [__], 1998
GMAC Commercial Mortgage Corporation
GMAC Commercial Mortgage Securities, Inc.
Xxxxxx Brothers Inc.
Deutsche Bank Securities Inc.
Fitch IBCA Inc.
Xxxxx'x Investors Service, Inc.
Standard & Poor's Ratings Service
LaSalle National Bank
Re: GMAC Commercial Mortgage Securities, Inc.,
Mortgage Pass-Through Certificates, Series 1998-C2
--------------------------------------------------
Ladies and Gentlemen:
I have acted as counsel to Xxxxxx Brothers Holdings Inc., doing business as
Xxxxxx Capital, a Division of Xxxxxx Brothers Holdings Inc. ("Xxxxxx"). GMAC
Commercial Mortgage Securities, Inc. will acquire certain mortgage loans from
Xxxxxx pursuant to the Mortgage Loan Purchase Agreement, dated as of August 21,
1998 (the "Mortgage Loan Purchase Agreement"). Capitalized terms used but not
defined herein shall have the meanings set forth in the Mortgage Loan Purchase
Agreement.
You have asked for my opinion regarding the due authorization of Xxxxxx to
enter into the Mortgage Loan Purchase Agreement.
As to matters of fact material to this opinion, I have relied, without
independent investigation on (i) the representations and warranties of Xxxxxx in
the Mortgage Loan Purchase Agreement, (ii) relevant resolutions of the Board of
Directors of Xxxxxx, (iii) certificates of responsible officers of Xxxxxx and
(iv) certificates of public officials.
D-4
In this connection, I have examined or have caused to be examined on my
behalf, a copy of the Mortgage Loan Purchase Agreement and such other documents
and instruments which I have deemed necessary or appropriate in connection with
this opinion.
I have relied on originals or copies, certified or otherwise identified to
my satisfaction, of the certificate of incorporation and by-laws of Xxxxxx,
records of proceedings taken by Xxxxxx, and such other corporate documents and
records of Xxxxxx, and have made such other investigations as I have deemed
relevant or necessary for the purpose of this action. I have assumed, without
independent investigation, the genuineness of all signatures (other than those
of officers of Xxxxxx), the authenticity of all documents submitted to me as
originals and the conformity to original documents of all documents submitted to
me as certified, conformed or reproduction copies.
On the basis of and subject to the foregoing, it is my opinion that:
(1) Xxxxxx is a corporation duly incorporated, validly existing and in
good standing under the laws of the State of Delaware, with the corporate power
and authority to transact the business contemplated by the Mortgage Loan
Purchase Agreement, and it has the requisite corporate power and authority to
execute and deliver the Mortgage Loan Purchase Agreement and to perform and
observe the terms and conditions thereof.
(2) The Mortgage Loan Purchase Agreement has been duly authorized,
executed and delivered by Xxxxxx.
(3) The execution, delivery and performance by Xxxxxx of the Mortgage Loan
Purchase Agreement will not conflict with, result in a breach of, or constitute
a default under any material term of Xxxxxx'x certificate of incorporation by
bylaws, any term or provision of any material contract, agreement or other
instrument known to me to which Xxxxxx is a party or by which it is bound, or,
to the best of my knowledge without independent investigation, any order,
judgment, writ, injunction or decree known to me of any court or governmental
authority having jurisdiction over Xxxxxx.
(4) The Mortgage Loan Purchase Agreement constitutes, assuming due
authorization, execution and delivery by the other party thereto, the valid and
binding obligation of Xxxxxx enforceable against Xxxxxx in accordance with its
terms, except as such enforcement may be limited by (a) bankruptcy, insolvency,
reorganization, moratorium or other laws affecting the enforcement of creditors'
rights generally, (b) general equity principles (regardless of whether such
enforcement is considered in a proceeding in equity or at law) and (c)
limitations of public policy under applicable securities laws as to rights of
indemnity thereunder.
This opinion letter is rendered for the sole benefit of each addressee
hereof, and no other person or entity is entitled to rely hereon without my
prior written consent. Copies of this opinion letter may not be furnished to
any other person or entity, nor may any portion of this opinion letter be
quoted, circulated or referred to in any other document without my prior written
consent.
Very truly yours,
D-5
EXHIBIT D-3B
FORM OF OPINION II OF COUNSEL TO THE SELLER
August , 1998
Xxxxxx Brothers Inc.
Three World Financial Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
GMAC Commercial Mortgage Securities, Inc.
000 Xxxxxxx Xxxx
Xxxxxxx, XX 00000-0000
Deutsche Bank Securities, Inc.
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Re: GMAC Commercial Mortgage Securities, Inc., Commercial Mortgage
Pass-Through Certificates Series 1998-C2
--------------------------------------------------------------
Ladies and Gentlemen:
We have acted as special counsel to Xxxxxx Brothers Holdings Inc., doing
business as Xxxxxx Capital, a Division of Xxxxxx Brothers Holdings Inc. (the
"Xxxxxx Seller"), in connection with certain aspects of the sale by the Xxxxxx
Seller, and the purchase by GMAC Commercial Mortgage Securities, Inc. (the
"Depositor"), of certain multifamily and commercial mortgage loans (the
"Mortgage Loans") pursuant to a Mortgage Loan Purchase Agreement dated as of
August 21, 1998 (the "Mortgage Loan Purchase Agreement") between the Xxxxxx
Seller and the Depositor, and further in connection with the preparation and
review of the sections entitled "Summary of Prospectus Supplement - The Mortgage
Asset Pool", "Risk Factors - The Mortgage Loans", "Description of the Mortgage
Asset Pool", and Annex A (collectively the "Specified Sections") of the
Prospectus Supplement dated August 21, 1998 (the "Prospectus Supplement") to the
Depositor's Prospectus dated December 17, 1997 (the "Base Prospectus"; the
Prospectus Supplement and the Base Prospectus are collectively referred to
herein as the "Prospectus"). Capitalized terms used but not defined herein have
the same respective meanings
D-6
that such terms have in the Mortgage Loan Purchase Agreement (and, if not
defined therein, then in the Prospectus).
For the purposes of this letter, we have examined originals or copies,
certified or otherwise authenticated to our satisfaction, of the Prospectus, the
Mortgage Loan Purchase Agreement and other such documents and records as we have
deemed relevant or necessary as the basis for the views expressed in this
letter. We have obtained such certificates from and made such inquiries of
officers and other representatives of the Xxxxxx Seller as we have deemed
relevant or necessary as the basis of the views expressed in this letter. We
have relied upon, and assumed the accuracy of, such other documents and records,
such certificates and the statements made in response to such inquiries, with
respect to the factual matters upon which the views expressed in this letter are
based. We have also assumed (i) the truthfulness and accuracy of each of the
representations and warranties as to factual matters contained in the Mortgage
Loan Purchase Agreement, (ii) the legal capacity of natural persons, (iii) the
genuineness of all signatures and the authenticity of all documents submitted to
us as originals, (iv) the conformity to the originals of all documents submitted
to us as certified, conformed or photostatic copies, (v) the due authorization
by all necessary action, and the due execution and delivery, of the Mortgage
Loan Purchase Agreement by the parties thereto and the constitution of the
Mortgage Loan Purchase Agreement as the legal, valid and binding obligation of
each party thereto, enforceable against such party in accordance with its terms,
(vi) compliance with the Mortgage Loan Purchase Agreement y the parties thereto,
(vii) the conformity, to the requirements of the Mortgage Loan Purchase
Agreement, of the Mortgage Notes, the Mortgages and the other documents
delivered to the Trustee in respect of the Mortgage Loans by, on behalf of or at
the direction of the Xxxxxx Seller and the Depositor, (viii) the absence of any
agreement that supplements or otherwise modifies the agreements expressed in the
Mortgage Loan Purchase Agreement, and (ix) the conformity of the text of each
document filed with the Securities Exchange Commission through the XXXXX system
to the printed document reviewed by us. In rendering this letter, we do not
express any view concerning the laws of any jurisdiction other than the federal
laws of the United States of America.
In the course of acting as special counsel to the Xxxxxx Seller with
respect to the matters discussed in the first paragraph of this letter, we have
generally reviewed and discussed with certain officers and other representatives
of the Xxxxxx Seller and its affiliates, as well as with counsel and certain
officers and other representatives of the Xxxxxx seller and its affiliates, as
well as with counsel and certain officers and other representatives of the
Depositor, the following items: (i) the Specified Sections; (ii) certain loan
summaries prepared by the Xxxxxx Seller with respect to Mortgage Loans with
Cut-off Date Balances in excess of $10,000,000; (iii) certain summaries relating
to environmental matters in respect of select Mortgaged Properties, which
Mortgaged Properties were chosen by the Xxxxxx Seller based on the nature of
such environmental matters; and (iv) the opinion of Xxxxxxxxxxx Xxxx, Esq.,
internal counsel for the Xxxxxx Seller. In addition to the foregoing, we acted
as special counsel to the Xxxxxx Seller in connection with the origination of
the South Towne Loan and, in such capacity, were actively involved in the
preparation and negotiation of the related loan documents. While we have not
otherwise made any independent check or verification of, and do not assume any
responsibility for, the accuracy, completeness or fairness of the statements
contained in the Specified Sections,
D-7
on the basis of the foregoing, nothing has come to our attention that causes
us to believe that the Specified Sections, as of the date of the Prospectus
Supplement or as of the date hereof, insofar as the information therein
relates to the Mortgage Loans and the Xxxxxx Seller, contained or contains
any untrue statement of a material fact or omitted or omits to state a
material fact necessary to make the statement therein, in the light of the
circumstances under which they were made, not misleading, except that we make
no statement as to any accounting, financial or statistical data or other
information of that nature contained in or omitted from the Specified
Sections. In that connection, we advise you that we have, as to materiality,
relied to the extent we deemed appropriate, upon the judgment of officers and
other representatives of the Xxxxxx Seller and its affiliates. In addition,
in that connection, we call to your attention that, with your knowledge and
consent, we have not, except as described above, examined or otherwise
reviewed any of the Mortgage Files, any particular documents contained in
such files or any other documents with respect to the Mortgage Loans. When
used in this letter, the term "attention" or any other word or phrase of
similar import means the conscious awareness of facts or other information of
attorneys who are currently practicing law with and
have been actively involved in representing the Xxxxxx Seller in connection
with the transactions referred to herein.
The statements set forth herein are being made to you as of the date
hereof, and we assume no obligation to advise you of any changes of law or fact
that may occur after the date hereof, notwithstanding that such changes may
affect the views or belief expressed herein. This letter is being delivered
solely for the benefit of the persons to which it is addressed and may not be
quoted, filed with any governmental authority or other regulatory agency or
otherwise circulated or utilized for any other purpose without our prior written
consent.
Very truly yours,
D-8
