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LOAN SALE AGREEMENT
This Loan Sale Agreement (the "Agreement"), dated as of March 1, 1997,
is between AMRESCO Commercial Mortgage Funding I Corporation., as purchaser
(the "Purchaser"), and AMRESCO Commercial Mortgage Funding, L.P., as Seller
(the "Seller").
Capitalized terms used in this Agreement not defined herein shall have
the meanings ascribed to them in the Pooling and Servicing Agreement dated as
of March 1, 1997 (the "Pooling and Servicing Agreement") among the Purchaser,
as depositor, AMRESCO Management, Inc., as servicer, ________, as special
servicer, and LaSalle National Bank, as trustee (in such capacity, the
"Trustee"), pursuant to which the Purchaser will sell the Mortgage Loans (as
defined herein) to a trust fund and certificates representing ownership
interest in the Mortgage Loans will be issued by the trust fund. For purposes
of this Agreement, the "Mortgage Loans" refers to the mortgage loans listed on
Exhibit A hereto and "Mortgaged Properties" refers to the properties securing
such Mortgage Loans.
The Purchaser and the Seller wish to prescribe the manner of sale of the
Mortgage Loans from the Seller to the Purchaser and in consideration of the
premises and the mutual agreements hereinafter set forth, agree as follows:
SECTION I. Sale and Conveyance of Mortgages: Possession of Mortgage
File. The Seller does hereby sell, transfer, assign, set over and convey to the
Purchaser all of its right, title, and interest in and to the Mortgage Loans
described in Exhibit A hereto, including all interest and principal received on
or with respect to the Mortgage Loans after the Cut-off Date (other than
payments of principal and interest first due on the Mortgage Loans on or before
the Cut-off Date), each related Mortgage File and, to the extent of its rights
and obligations thereunder with respect to the Mortgage Loans, each Servicing
Agreement. Upon sale of the Mortgage Loans, the ownership of each Mortgage
Note, the Mortgage and the contents of the related Mortgage File will be vested
in the Purchaser and immediately thereafter the Trustee and the ownership of
records and documents with respect to the related Mortgage Loan prepared by or
which come into the possession of the Seller shall immediately vest in the
Purchaser and immediately thereafter the Trustee and shall be retained and
maintained in trust, by the Seller at the will of the Purchaser and the Trustee
in such custodial capacity only. The Seller's records will accurately reflect
the sale of each Mortgage Loan to the Trustee. The Seller shall release its
custody of the contents of any Mortgage File only in accordance with the
Custodial Agreement.
As the purchase price of the Mortgage Loans, the Purchaser shall pay to
the Seller or at the Seller's direction the sum of (a) the net proceeds of the
offering of the Certificates (net of any underwriting and placement agent fees)
plus (b) the amount, as determined by the Seller and notified to the Purchaser,
of any costs or expenses incurred by the Seller in connection with unwinding
any xxxxxx placed by the Seller on the Mortgage Loans.
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SECTION II. Books and Records. From and after the sale of the Mortgage
Loans to the Purchaser, record title to each Mortgage and the related Mortgage
Note shall be transferred to the Trustee in accordance with this Agreement. All
rights arising out of the Mortgage Loans, including, but not limited to, all
funds received on or in connection with a Mortgage Loan, shall be received and
held by the Seller in trust for the benefit of the Trustee as the owner of the
Mortgage Loans.
The transfer of each Mortgage Loan shall be reflected on the Seller's
balance sheets and other financial statements as a sale of the Mortgage Loans
by the Seller to the Purchaser. The Seller shall be responsible for
maintaining, and shall maintain, a set of records for each Mortgage Loan which
shall be clearly marked to reflect the ownership of each Mortgage Loan by the
Trustee pursuant to the Pooling and Servicing Agreement.
SECTION III. Delivery of Mortgage Loan Documents. On the Delivery Date,
the Seller shall deliver or cause to be delivered to the Trustee or its
custodian each of the following documents for each Mortgage Loan:
a. the original or, if accompanied by a "lost note"
affidavit, a copy of the Mortgage Note, endorsed by the
Seller in blank or to the order of the Trustee;
b. the original Mortgage, and any intervening assignments (or
certified copies of such assignments) thereof, in each
case with evidence of recording indicated thereon or a
certified copy thereof if not returned from the applicable
recording officer;
c. originals or certified copies of any related Assignment of
Leases and Rents and any related Security Agreement (if,
in either case, such item is a document separate from the
Mortgage), any intervening assignments of each such
document or instrument, and any related UCC Financing
Statements;
d. an assignment of the Mortgage, executed by the Seller in
blank or to the order of the Trustee, with the assignment
to the Trustee in the following form: "LaSalle National
Bank, as trustee for AMRESCO Commercial Mortgage Funding I
Corporation Mortgage Pass-Through Certificates, Series
199__-___", in recordable form;
e. assignments of any related Assignment of Leases and Rents
and any related Security Agreement (if, in either case,
such item is a document separate from the Mortgage),
executed by the Seller or the prior holder which
transferred such Mortgage Loan in blank or to the order of
the Trustee, with the assignment to the trustee in the
following form: "LaSalle National Bank, as trustee for
AMRESCO Commercial Mortgage Funding I Corporation Mortgage
Pass-Through Certificates, Series 199__-___";
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f. originals or certified copies of all assumption,
modification and substitution agreements in those
instances where the terms or provisions of the Mortgage or
Mortgage Note have been modified or the Mortgage Note has
been assumed;
g. the originals or certificates of a lender's title
insurance policy issued on the date of the origination of
such Mortgage Loan or, with respect to each Mortgage Loan
not covered by a lender's title insurance policy, an
attorney's opinion of title given by an attorney licensed
to practice law in the jurisdiction where the Mortgage
Property is located;
h. with respect to any Mortgage Loan secured by a leasehold
interest, a certified copy of the related ground lease;
i. either (i) the originals of all intervening assignments,
including warehousing assignments, with evidence of
recording thereon, (ii) copies of such assignments
certified by a title company or escrow company to be true
and complete copies thereof where the originals have been
transmitted for recording until such time as the originals
are returned by the public recording office or (iii)
copies of such assignments certified by the public
recording offices where such assignments were recorded to
be true and complete copies thereof in those instances
where the public recording offices retain the originals or
where the original recorded assignments are lost;
j. either (i) copies of the UCC-1 financing statements and
any related continuation statements, each showing the
mortgagor as debtor and the originator as secured party
and each with evidence of filing thereon, together with a
copy of each intervening UCC-2 or UCC-3 financing
statement showing a complete chain of assignment from the
secured party named in such UCC-1 financing statement to
the Trustee with evidence of filing thereon disclosing the
assignment to the Trustee of the security interest in the
personal property securing the Mortgage Loan or (ii)
copies of such financing statements certified to be true
and complete copies thereof in instances where the
original financing statements have been sent to the
appropriate public filing office for filing;
k. the original appraisal; and
l. any escrow, guarantee and environmental liability
agreement.
SECTION IV. Treatment as a Security Agreement. The Seller, concurrently
with the execution and delivery hereof, has conveyed to the Purchaser, all of
its right, title and interest in and to the Mortgage Loans. The parties intend
that such conveyance of the Seller's right, title and
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interest in and to the Mortgage Loans pursuant to this Agreement shall
constitute a purchase and sale and not a loan. If such conveyance is deemed to
be a pledge and not a sale, then the parties also intend and agree that the
Seller shall be deemed to have granted, and does hereby grant, to the
Purchaser, a first priority perfected security interest in all of its right,
title and interest in, to and under the Mortgage Loans, all payments of
principal or interest on such Mortgage Loans, all other payments made and to be
made in respect of such Mortgage Loans and all proceeds thereof and that this
Agreement shall constitute a security agreement under applicable law. If such
conveyance is deemed to be a pledge and not a sale, the Seller consents to the
Purchaser hypothecating and transferring such security interest in favor of the
Trustee and transferring the obligation secured thereby to the Trustee.
SECTION V. Recordation of Assignments of Mortgage. The Purchaser shall
require, to the extent required in the Pooling and Servicing Agreement, the
Seller to record in the appropriate public recording office for real property
the intermediate assignments of the Mortgage Loans and the Assignments of
Mortgage from the Seller to the Trustee in connection with the Pooling and
Servicing Agreement. All recording fees relating to the initial recordation of
such intermediate assignments and Assignments of Mortgage shall be paid by the
Seller.
SECTION VI. Representations and Warranties.
A. The Purchaser represents and warrants it is a corporation duly
organized, validly existing, and in good standing in the State of Delaware.
B. The Seller represents and warrants it is a limited partnership
duly organized, validly existing, and in good standing in the State of [ ].
C. The Seller represents and warrants that immediately prior to the
sale and assignment contemplated herein, the Seller was the sole owner of the
Mortgage Loans free and clear of any and all liens, pledges, charges of
security interests of any nature and has full right and authority to sell and
assign the same.
D. The Seller and the Purchaser each represents and warrants to the
other that:
1. it has the power and authority to own its property and to
carry on its business as now conducted;
2. it has the power to execute, deliver and perform this
Agreement;
3. the execution, delivery and performance of this Agreement
have been duly authorized by all requisite action by such
entity's board of directors or general partner and will not
violate or breach any provision of any organizational document or
other agreement or instrument to which such entity is a party or
by which it is
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bound, or constitute a default or result in an acceleration under
any of the foregoing, or results in the violation of any law,
rule, regulation, order, judgment or decree to which such party
or its property is subject; and
4. this Agreement constitutes a legal, valid and binding
obligation of such party enforceable in accordance with its
terms, except as such enforcement may be limited by the
provisions of any bankruptcy or insolvency law, or law relating
to enforcement of creditors' rights generally, and by general
principles of equity, regardless of whether enforcement is sought
in a proceeding at law or in equity.
E. The Seller further makes the representations and warranties as to
the Mortgage Loans set forth in Exhibit B hereto as of the Delivery Date. The
Seller hereby covenants and agrees that is shall cure any breach of such
representations and warranties or repurchase any Mortgage Loans as to which
there has been any such breach at the Purchase Price, to the extent that such
breach materially and adversely affects the value of any Mortgage Loan or the
interest of any Certificateholders therein. Such cure or repurchase shall occur
within 90 days of the receipt of notice by the Seller of any such breach of a
representation and warranty in accordance with Section 2.04 of the Pooling and
Servicing Agreement.
F. The representations and warranties of the parties hereto shall
survive the execution and delivery and any termination of this Agreement.
SECTION VII. Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be for any
reason whatsoever held invalid, then such covenants, agreements, provisions or
terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity
or enforceability of the other provisions of this Agreement.
SECTION VIII. Governing Law. This Agreement shall be construed in
accordance with the laws of the State of [Texas] and the obligations, rights
and remedies of the parties hereunder shall be determined in accordance with
such laws.
SECTION IX. No Third-Party Beneficiaries. The parties do not intend the
benefits of this Agreement to insure to any third party except as expressly set
forth in Section X.
SECTION X. Assignment. The Seller hereby acknowledges that the Purchaser
has, concurrently with the execution hereof, executed and delivered in the
Pooling and Servicing Agreement and that, in connection therewith, it has
assigned its rights hereunder to the Trustee for the benefit of the
Certificateholders.
SECTION XI. Notices. All demands, notices and communications hereunder
shall be in writing and shall be deemed to have been duly given if personally
delivered at or mailed by first class or registered mail, postage prepaid, to
(i) in the case of the Purchaser, AMRESCO Commercial
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Mortgage Funding I Corporation, 000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000, L.B. Xx.
000, Xxxxxx, Xxxxx 00000 Attention: Xxxxxxx X. Xxxxxxx, (ii) in the case of the
Seller, AMRESCO Commercial Mortgage Funding, L.P., ________, ________, ________
Attention: ________, and (iii) in the case of any of the preceding parties,
such other address as may hereafter be furnished to the other party in writing
by such Parties.
SECTION XII. Amendment. This Agreement may be amended only by a written
instrument which specifically refers to this Agreement and is executed by the
Purchaser and the Seller. This Agreement shall not be deemed to be amended
orally or by virtue of any continuing custom or practice.
SECTION XIII. Counterparts. This Agreement may be executed in any number
of counterparts, and by the parties hereto in separate counterparts, each of
which when executed and delivered shall be deemed to be an original and all of
which taken together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the Purchaser and the Seller have caused their names
to be signed hereto by this respective officers thereunto duly authorized as of
the day and year first above written.
AMRESCO COMMERCIAL MORTGAGE FUNDING I
CORPORATION
By:
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Name:
Title:
AMRESCO COMMERCIAL MORTGAGE FUNDING, L.P.
By:
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Name:
Title:
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EXHIBIT A
MORTGAGE LOAN SCHEDULE
