EXECUTION VERSION
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MORTGAGE LOAN PURCHASE AGREEMENT
between
LASALLE BANK NATIONAL ASSOCIATION
as Seller
and
XXXXXX XXXXXXX CAPITAL I INC.
as Purchaser
Dated as of August 8, 2006
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TABLE OF CONTENTS
1. AGREEMENT TO PURCHASE................................................ 3
2. CONVEYANCE OF MORTGAGE LOANS......................................... 3
3. EXAMINATION OF MORTGAGE FILES AND DUE DILIGENCE REVIEW............... 11
4. REPRESENTATIONS AND WARRANTIES OF SELLER AND PURCHASER............... 12
5. REMEDIES UPON BREACH OF REPRESENTATIONS AND WARRANTIES MADE
BY SELLER............................................................ 16
6. CLOSING.............................................................. 20
7. CLOSING DOCUMENTS.................................................... 21
8. COSTS................................................................ 24
9. NOTICES.............................................................. 24
10. SEVERABILITY OF PROVISIONS........................................... 24
11. FURTHER ASSURANCES................................................... 24
12. SURVIVAL............................................................. 24
13. GOVERNING LAW........................................................ 25
14. BENEFITS OF MORTGAGE LOAN PURCHASE AGREEMENT......................... 25
15. MISCELLANEOUS........................................................ 25
16. ENTIRE AGREEMENT..................................................... 25
Exhibit 1 Mortgage Loan Schedule
Exhibit 2 Representations and Warranties
Exhibit 3 Pricing Formulation
Exhibit 4 Xxxx of Sale
Exhibit 5 Power of Attorney
Index of Defined Terms
Affected Loan(s)........................................................... 17
Agreement.................................................................. 2
Certificate Purchase Agreement............................................. 2
Certificates............................................................... 2
Closing Date............................................................... 3
Collateral Information..................................................... 11
Crossed Mortgage Loans..................................................... 17
Defective Mortgage Loan.................................................... 17
Final Judicial Determination............................................... 19
Indemnification Agreement.................................................. 14
Initial Purchaser.......................................................... 2
Master Servicer............................................................ 2
Material Breach............................................................ 16
Material Document Defect................................................... 16
Memorandum................................................................. 2
MERS....................................................................... 5
Mortgage File.............................................................. 4
Mortgage Loan Schedule..................................................... 3
Mortgage Loans............................................................. 2
Officer's Certificate...................................................... 7
Other Mortgage Loans....................................................... 2
Pooling and Servicing Agreement............................................ 2
Private Certificates....................................................... 2
Prospectus Supplement...................................................... 2
Public Certificates........................................................ 2
Purchaser.................................................................. 2
Repurchased Loan........................................................... 18
Seller..................................................................... 2
Servicing File............................................................. 9
Special Servicer........................................................... 2
Trust...................................................................... 2
Trustee.................................................................... 2
Underwriters............................................................... 2
Underwriting Agreement..................................................... 2
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MORTGAGE LOAN PURCHASE AGREEMENT
(LASALLE LOANS)
Mortgage Loan Purchase Agreement (this "Agreement"), dated as of August 8, 2006,
between LaSalle Bank National Association (the "Seller"), and Xxxxxx Xxxxxxx
Capital I Inc. (the "Purchaser").
Seller agrees to sell and Purchaser agrees to purchase certain mortgage loans
listed on Exhibit 1 hereto (the "Mortgage Loans") as described herein. Purchaser
will convey the Mortgage Loans to a trust (the "Trust") created pursuant to a
Pooling and Servicing Agreement (the "Pooling and Servicing Agreement"), to be
dated as of August 1, 2006, between Purchaser, as depositor, Xxxxx Fargo Bank,
National Association, as master servicer, X.X. Xxxxxx Company, Inc., as special
servicer ("Special Servicer"), HSBC Bank USA, National Association, as trustee
("Trustee") and LaSalle Bank National Association, as paying agent, custodian,
certificate registrar and authenticating agent. In exchange for the Mortgage
Loans and certain other mortgage loans (the "Other Mortgage Loans") to be
purchased by Purchaser, the Trust will issue to the Depositor pass-through
certificates to be known as Xxxxxx Xxxxxxx Capital I Inc., Commercial Mortgage
Pass-Through Certificates, Series 2006-HQ9 (the "Certificates"). The
Certificates will be issued pursuant to the Pooling and Servicing Agreement.
Capitalized terms used herein but not defined herein shall have the meanings
assigned to them in the Pooling and Servicing Agreement. The term "Master
Servicer" as used herein shall mean Xxxxx Fargo Bank, National Association in
its capacity as a master servicer under the Pooling and Servicing Agreement
unless otherwise specified.
The Class A-1, Class A-1A, Class A-2, Class A-3, Class A-AB, Class A-4, Class
A-4FL, Class A-M, Class A-J, Class B, Class C, Class D, Class E and Class F
Certificates (the "Public Certificates") will be sold by Purchaser to Xxxxxx
Xxxxxxx & Co. Incorporated, LaSalle Financial Services, Inc., Greenwich Capital
Markets, Inc. and Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated (the
"Underwriters"), pursuant to an Underwriting Agreement, between Purchaser and
the Underwriters, dated August 8, 2006 (the "Underwriting Agreement"), and the
Class X, Class X-MP, Class X-RC, Class G, Class H, Class J, Class K, Class L,
Class M, Class N, Class O, Class P, Class Q, Class S, Class T, Class DP, Class
ST, Class R-I, Class R-II and Class R-III Certificates (the "Private
Certificates") will be sold by Purchaser to Xxxxxx Xxxxxxx & Co. Incorporated
(the "Initial Purchaser") pursuant to a Certificate Purchase Agreement, between
Purchaser and the Initial Purchaser, dated August 8, 2006 (the "Certificate
Purchase Agreement"). The Underwriters will offer the Public Certificates for
sale publicly pursuant to a Prospectus dated March 14, 2006, as supplemented by
a Prospectus Supplement dated August 8, 2006 (together with the Prospectus, the
"Prospectus Supplement"), and the Initial Purchaser will offer the Private
Certificates for sale in transactions exempt from the registration requirements
of the Securities Act of 1933 pursuant to a Private Placement Memorandum dated
August 8, 2006 (the "Memorandum").
In consideration of the mutual agreements contained herein, Seller and Purchaser
hereby agree as follows:
1. AGREEMENT TO PURCHASE.
1.1 Seller agrees to sell, and Purchaser agrees to purchase, on a servicing
released basis, the Mortgage Loans identified on the schedule (the "Mortgage
Loan Schedule") annexed hereto as Exhibit 1, as such schedule may be amended to
reflect the actual Mortgage Loans accepted by Purchaser pursuant to the terms
hereof. The Cut-Off Date with respect to the Mortgage Loans is August 1, 2006.
The Mortgage Loans will have an aggregate principal balance as of the close of
business on the Cut-Off Date, after giving effect to any payments due on or
before such date, whether or not received, of $805,810,091. The sale of the
Mortgage Loans shall take place on August 17, 2006 or such other date as shall
be mutually acceptable to the parties hereto (the "Closing Date"). The purchase
price to be paid by Purchaser for the Mortgage Loans shall equal the amount set
forth as such purchase price on Exhibit 3 hereto. The purchase price shall be
paid to Seller by wire transfer in immediately available funds on the Closing
Date.
1.2 On the Closing Date, Purchaser will assign to Trustee pursuant to the
Pooling and Servicing Agreement all of its right, title and interest in and to
the Mortgage Loans and its rights under this Agreement (to the extent set forth
in Section 14), and Trustee shall succeed to such right, title and interest in
and to the Mortgage Loans and Purchaser's rights under this Agreement (to the
extent set forth in Section 14).
2. CONVEYANCE OF MORTGAGE LOANS.
2.1 Effective as of the Closing Date, subject only to receipt of the
consideration referred to in Section 1 hereof and the satisfaction of the
conditions specified in Sections 6 and 7 hereof, Seller does hereby transfer,
assign, set over and otherwise convey to Purchaser, without recourse, except as
specifically provided herein, all the right, title and interest of Seller, with
the understanding that a Servicing Rights Purchase and Sale Agreement, dated
August 1, 2006, will be executed by Seller and Master Servicer, in and to the
Mortgage Loans identified on the Mortgage Loan Schedule as of the Closing Date.
The Mortgage Loan Schedule, as it may be amended from time to time on or prior
to the Closing Date, shall conform to the requirements of this Agreement and the
Pooling and Servicing Agreement. In connection with such transfer and
assignment, Seller shall deliver to or on behalf of Trustee, on behalf of
Purchaser, on or prior to the Closing Date, the Mortgage Note (as described in
clause 2.2.1 hereof) for each Mortgage Loan and on or prior to the fifth
Business Day after the Closing Date, five limited powers of attorney
substantially in the form attached hereto as Exhibit 5 in favor of Trustee,
Master Servicer and Special Servicer to empower Trustee, Master Servicer and, in
the event of the failure or incapacity of Trustee and Master Servicer, Special
Servicer, to submit for recording, at the expense of Seller, any Mortgage Loan
documents required to be recorded as described in the Pooling and Servicing
Agreement and any intervening assignments with evidence of recording thereon
that are required to be included in the Mortgage Files (so long as original
counterparts have previously been delivered to Trustee). Seller agrees to
reasonably cooperate with Trustee, Master Servicer and Special Servicer in
connection with any additional powers of attorney or revisions thereto that are
requested by such parties for purposes of such recordation. The parties hereto
agree that no such power of attorney shall be used with respect to any Mortgage
Loan by or under authorization by any party hereto except to the extent that the
absence of a document described in the second preceding sentence with respect to
such Mortgage Loan remains
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unremedied as of the earlier of (i) the date that is 180 days following the
delivery of notice of such absence to Seller, but in no event earlier than 18
months from the Closing Date, and (ii) the date (if any) on which such Mortgage
Loan becomes a Specially Serviced Mortgage Loan. Custodian shall submit such
documents for recording, at Seller's expense, after the periods set forth above,
provided, however, Custodian shall not submit such assignments for recording if
Seller produces evidence that it has sent any such assignment for recording and
certifies that Seller is awaiting its return from the applicable recording
office. In addition, not later than the 30th day following the Closing Date,
Seller shall deliver to or on behalf of Trustee each of the remaining documents
or instruments specified in Section 2.2 hereof (with such exceptions and
additional time periods as are permitted by this Section 2) with respect to each
Mortgage Loan (each, a "Mortgage File"). (Seller acknowledges that the term
"without recourse" does not modify the duties of Seller under Section 5 hereof.)
2.2 All Mortgage Files, or portions thereof, delivered prior to the Closing Date
are to be held by or on behalf of Trustee in escrow on behalf of Seller at all
times prior to the Closing Date. The Mortgage Files shall be released from
escrow upon closing of the sale of the Mortgage Loans and payments of the
purchase price therefor as contemplated hereby. The Mortgage File for each
Mortgage Loan shall contain the following documents:
2.2.1 The original Mortgage Note bearing all intervening endorsements,
endorsed "Pay to the order of HSBC Bank USA, National Association, as Trustee
for Xxxxxx Xxxxxxx Capital I Inc., Commercial Mortgage Pass-Through
Certificates, Series 2006-HQ9, without recourse, representation or warranty" or
if the original Mortgage Note is not included therein, then a lost note
affidavit, with a copy of the Mortgage Note attached thereto;
2.2.2 The original Mortgage, with evidence of recording thereon, and, if
the Mortgage was executed pursuant to a power of attorney, a certified true copy
of the power of attorney certified by the public recorder's office, with
evidence of recording thereon (if recording is customary in the jurisdiction in
which such power of attorney was executed), or certified by a title insurance
company or escrow company to be a true copy thereof; provided that if such
original Mortgage cannot be delivered with evidence of recording thereon on or
prior to the 90th day following the Closing Date because of a delay caused by
the public recording office where such original Mortgage has been delivered for
recordation or because such original Mortgage has been lost, Seller shall
deliver or cause to be delivered to Trustee a true and correct copy of such
Mortgage, together with (i) in the case of a delay caused by the public
recording office, an Officer's Certificate (as defined below) of Seller stating
that such original Mortgage has been sent to the appropriate public recording
official for recordation or (ii) in the case of an original Mortgage that has
been lost after recordation, a certification by the appropriate county recording
office where such Mortgage is recorded that such copy is a true and complete
copy of the original recorded Mortgage;
2.2.3 The originals of all agreements modifying a Money Term or other
material modification, consolidation and extension agreements, if any, with
evidence of recording thereon, or if any such original modification,
consolidation or extension agreement has been delivered to the appropriate
recording office for recordation and either has not yet been returned on or
prior to the 90th day following the Closing Date with evidence of recordation
thereon or has been lost after recordation, a true copy of such modification,
consolidation or extension
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certified by Seller together with (i) in the case of a delay caused by the
public recording office, an Officer's Certificate of Seller stating that such
original modification, consolidation or extension agreement has been dispatched
or sent to the appropriate public recording official for recordation or (ii) in
the case of an original modification, consolidation or extension agreement that
has been lost after recordation, a certification by the appropriate county
recording office where such document is recorded that such copy is a true and
complete copy of the original recorded modification, consolidation or extension
agreement, and the originals of all assumption agreements, if any;
2.2.4 An original Assignment of Mortgage for each Mortgage Loan, in form
and substance acceptable for recording (except for recording information not yet
available if the instrument being recorded has not been returned from the
applicable recording office), signed by the holder of record in blank or in
favor of "HSBC Bank USA, National Association, as Trustee for Xxxxxx Xxxxxxx
Capital I Inc., Commercial Mortgage Pass-Through Certificates, Series 2006-HQ9,"
provided, if the related Mortgage has been recorded in the name of Mortgage
Electronic Registration Systems, Inc. ("MERS") or its designee, no such
assignments will be required to be submitted for recording or filing and
instead, Seller shall take all actions as are necessary to cause Trustee to be
shown as the owner of the related Mortgage on the record of MERS for purposes of
the system of recording transfers of beneficial ownership of mortgages
maintained by MERS and shall deliver to Special Servicer evidence confirming
that Trustee is shown as the owner on the record of MERS;
2.2.5 Originals of all intervening assignments of Mortgage (except with
respect to any Mortgage that has been recorded in the name of MERS or its
designees), if any, with evidence of recording thereon or, if such original
assignments of Mortgage have been delivered to the appropriate recorder's office
for recordation, certified true copies of such assignments of Mortgage certified
by Seller, or in the case of an original blanket intervening assignment of
Mortgage retained by Seller, a copy thereof certified by Seller or, if any
original intervening assignment of Mortgage has not yet been returned on or
prior to the 90th day following the Closing Date from the applicable recording
office or has been lost, a true and correct copy thereof, together with (i) in
the case of a delay caused by the public recording office, an Officer's
Certificate of Seller stating that such original intervening assignment of
Mortgage has been sent to the appropriate public recording official for
recordation or (ii) in the case of an original intervening Assignment of
Mortgage that has been lost after recordation, a certification by the
appropriate county recording office where such assignment is recorded that such
copy is a true and complete copy of the original recorded intervening Assignment
of Mortgage;
2.2.6 If the related Assignment of Leases is separate from the Mortgage,
the original of such Assignment of Leases with evidence of recording thereon or,
if such Assignment of Leases has not been returned on or prior to the 90th day
following the Closing Date from the applicable public recording office, a copy
of such Assignment of Leases certified by Seller to be a true and complete copy
of the original Assignment of Leases submitted for recording, together with (i)
an original of each assignment of such Assignment of Leases with evidence of
recording thereon and showing a complete recorded chain of assignment from the
named assignee to the holder of record, and if any such assignment of such
Assignment of Leases has not been returned from the applicable public recording
office, a copy of such assignment certified by Seller to be a true and complete
copy of the original assignment submitted for recording, and (ii) an original
assignment
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of such Assignment of Leases, in recordable form, signed by the holder of record
in favor of "HSBC Bank USA, National Association, as Trustee for Xxxxxx Xxxxxxx
Capital I Inc., Commercial Mortgage Pass-Through Certificates, Series 2006-HQ9,"
which assignment may be effected in the related Assignment of Mortgage,
provided, if the related Mortgage has been recorded in the name of MERS or its
designee, no assignment of Assignment of Leases in favor of Trustee will be
required to be recorded or delivered and instead, Seller shall take all actions
as are necessary to cause Trustee to be shown as the owner of the related
Mortgage on the record of MERS for purposes of the system of recording transfers
of beneficial ownership of mortgages maintained by MERS and shall deliver to
Special Servicer evidence confirming that Trustee is shown as the owner on the
record of MERS;
2.2.7 The original or a copy of each guaranty, if any, constituting
additional security for the repayment of such Mortgage Loan;
2.2.8 The original Title Insurance Policy, or in the event such original
Title Insurance Policy has not been issued, an original binder or actual title
commitment or a copy thereof certified by the title company with the original
Title Insurance Policy to follow within 180 days of the Closing Date or a
preliminary title report with an original Title Insurance Policy to follow
within 180 days of the Closing Date;
2.2.9 (A) Copies of UCC financing statements (together with all assignments
thereof) and (B) UCC-2 or UCC-3 financing statements assigning such UCC
financing statements to Trustee executed and delivered in connection with the
Mortgage Loan, provided, if the related Mortgage has been recorded in the name
of MERS or its designee, no such financing statements will be required to be
recorded or delivered and instead, Seller shall take all actions as are
necessary to cause Trustee to be shown as the owner of the related Mortgage on
the record of MERS for purposes of the system of recording transfers of
beneficial ownership of mortgages maintained by MERS and shall deliver to
Special Servicer evidence confirming that Trustee is shown as the owner on the
record of MERS;
2.2.10 Copies of the related ground lease(s), if any, to any Mortgage Loan
where the Mortgagor is the lessee under such ground lease and there is a lien in
favor of the mortgagee in such lease;
2.2.11 Copies of any loan agreements, lock-box agreements and intercreditor
agreements (including, without limitation, any Intercreditor Agreement, any
Non-Serviced Mortgage Loan Intercreditor Agreement and any Loan Pair
Intercreditor Agreement, and a copy (that is, not the original) of the mortgage
note evidencing the related B Note), if any, related to any Mortgage Loan;
2.2.12 Either (A) the original of each letter of credit, if any,
constituting additional collateral for such Mortgage Loan (other than letters of
credit representing tenant security deposits which have been collaterally
assigned to the lender), which shall be assigned and delivered to Trustee on
behalf of the Trust with a copy to be held by Primary Servicer (or Master
Servicer), and applied, drawn, reduced or released in accordance with documents
evidencing or securing the applicable Mortgage Loan, the Pooling and Servicing
Agreement and the Primary Servicing Agreement or (B) the original of each letter
of credit, if any, constituting additional
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collateral for such Mortgage Loan (other than letters of credit representing
tenant security deposits which have been collaterally assigned to the lender),
which shall be held by Primary Servicer (or Master Servicer) on behalf of
Trustee, with a copy to be held by Trustee, and applied, drawn, reduced or
released in accordance with documents evidencing or securing the applicable
Mortgage Loan, the Pooling and Servicing Agreement and the Primary Servicing
Agreement (it being understood that Seller has agreed (a) that the proceeds of
such letter of credit belong to the Trust, (b) to notify, on or before the
Closing Date, the bank issuing the letter of credit that the letter of credit
and the proceeds thereof belong to the Trust, and to use reasonable efforts to
obtain within 30 days (but in any event to obtain within 90 days) following the
Closing Date, an acknowledgement thereof by the bank (with a copy of such
acknowledgement to be sent to Trustee) or a reissued letter of credit and (c) to
indemnify the Trust for any liabilities, charges, costs, fees or other expenses
accruing from the failure of Seller to assign the letter of credit hereunder
including the right and power to draw on the letter of credit). In the case of
clause (B) above, any letter of credit held by Primary Servicer (or Master
Servicer) acknowledges that any letter of credit held by it shall be held in its
capacity as agent of the Trust, and if Primary Servicer (or Master Servicer)
sells its rights to service the applicable Mortgage Loan, Primary Servicer (or
Master Servicer) has agreed to assign the applicable letter of credit to the
Trust or at the direction of Special Servicer to such party as Special Servicer
may instruct, in each case, at the expense of Primary Servicer (or Master
Servicer). Primary Servicer (or Master Servicer) has agreed to indemnify the
Trust for any loss caused by the ineffectiveness of such assignment;
2.2.13 The original or a copy of the environmental indemnity agreement, if
any, related to any Mortgage Loan;
2.2.14 Copies of third-party management agreements, if any, for all hotels
and for such other Mortgaged Properties securing Mortgage Loans with a Cut-Off
Date principal balance equal to or greater than $20,000,000;
2.2.15 The original or a copy of any Environmental Insurance Policy; and
2.2.16 Any affidavit and indemnification agreement.
The original of each letter of credit referred to in clause 2.2.12 above shall
be delivered to Primary Servicer, Master Servicer or Trustee (as the case may
be) within 45 days of the Closing Date. In addition, a copy of any ground lease
shall be delivered to Primary Servicer within 30 days of the Closing Date.
"Officer's Certificate" shall mean a certificate signed by one or more of the
Chairman of the Board, any Vice Chairman, the President, any Senior Vice
President, any Vice President, any Assistant Vice President, any Treasurer or
any Assistant Treasurer.
2.3 The Assignments of Mortgage and assignment of Assignment of Leases referred
to in Sections 2.2.4 and 2.2.6 may be in the form of a single instrument
assigning the Mortgage and the Assignment of Leases to the extent permitted by
applicable law. To avoid the unnecessary expense and administrative
inconvenience associated with the execution and recording or filing of multiple
assignments of mortgages, assignments of leases (to the extent separate from the
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mortgages) and assignments of UCC financing statements, Seller shall execute, in
accordance with the third succeeding paragraph, the assignments of mortgages,
the assignments of leases (to the extent separate from the mortgages) and the
assignments of UCC financing statements relating to the Mortgage Loans naming
Trustee on behalf of the Certificateholders as assignee. Notwithstanding the
fact that such assignments of mortgages, assignments of leases (to the extent
separate from the assignments of mortgages) and assignments of UCC financing
statements shall name Trustee on behalf of the Certificateholders as the
assignee, the parties hereto acknowledge and agree that the Mortgage Loans shall
for all purposes be deemed to have been transferred from Seller to Purchaser and
from Purchaser to Trustee on behalf of the Certificateholders.
2.4 If Seller cannot deliver, or cause to be delivered, as to any Mortgage Loan,
any of the documents and/or instruments referred to in Sections 2.2.2, 2.2.3,
2.2.5 or 2.2.6, with evidence of recording thereon, solely because of a delay
caused by the public recording office where such document or instrument has been
delivered for recordation within such 90 day period, but Seller delivers a
photocopy thereof (certified by the appropriate county recorder's office to be a
true and complete copy of the original thereof submitted for recording), to
Trustee within such 90 day period, Seller shall then deliver within 180 days
after the Closing Date the recorded document (or within such longer period after
the Closing Date as Trustee may consent to, which consent shall not be
unreasonably withheld so long as Seller is, as certified in writing to Trustee
no less often than monthly, in good faith attempting to obtain from the
appropriate county recorder's office such original or photocopy).
2.5 Trustee, as assignee or transferee of Purchaser, shall be entitled to all
scheduled payments of principal due thereon after the Cut-Off Date, all other
payments of principal collected after the Cut-Off Date (other than scheduled
payments of principal due on or before the Cut-Off Date), and all payments of
interest on the Mortgage Loans allocable to the period commencing on the Cut-Off
Date. All scheduled payments of principal and interest due on or before the
Cut-Off Date and collected after the Cut-Off Date shall belong to Seller.
2.6 Within 45 days following the Closing Date, Seller shall deliver, and
Purchaser, Trustee or the agents of either may submit or cause to be submitted
for recordation at the expense of Seller, in the appropriate public office for
real property records, each assignment referred to in clauses 2.2.4, 2.2.6(ii)
and 2.2.9(B) above (with recording information in blank if such information is
not yet available). If any such document or instrument is lost or returned
unrecorded or unfiled, as the case may be, because of a defect therein, Seller
shall prepare a substitute therefor or cure such defect, and Seller shall, at
its own expense (except in the case of a document or instrument that is lost by
Trustee), record or file, as the case may be, and deliver such document or
instrument in accordance with this Section 2.
2.7 As to each Mortgage Loan secured by a Mortgaged Property with respect to
which the related Mortgagor has entered into a franchise agreement and each
Mortgage Loan secured by a Mortgaged Property with respect to which a letter of
credit is in place, Seller shall provide a notice on or prior to the date that
is 30 days after the Closing Date to the franchisor or the issuing financial
institution, as applicable, of the transfer of such Mortgage Loan to the Trust
pursuant to the Pooling and Servicing Agreement, and inform such parties that
any notices to the Mortgagor's lender pursuant to such franchise agreement or
letter of credit should thereafter be forwarded to Master Servicer and, with
respect to each franchise agreement, provide a franchise
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comfort letter to the franchisor on or prior to the date that is 30 days after
the Closing Date. After the Closing Date, with respect to any letter of credit
that has not yet been assigned to the Trust, upon the written request of Master
Servicer or the applicable Primary Servicer, Seller will draw on such letter of
credit as directed by Master Servicer or such Primary Servicer in such notice to
the extent Seller has the right to do so.
2.8 Documents that are in the possession of Seller, its agents or its
subcontractors that relate to the servicing of any Mortgage Loans and that are
not required to be a part of the Mortgage File and are reasonably necessary for
the ongoing administration and/or servicing of the applicable Mortgage Loan (the
"Servicing File") shall be delivered to Trustee shall be shipped by Seller to or
at the direction of Master Servicer, on behalf of Purchaser, on or prior to the
75th day after the Closing Date, in accordance with Section 3.1 of the Primary
Servicing Agreement, if applicable.
2.9 The documents required to be delivered to Master Servicer (or in the
alternative, Primary Servicer) shall include, to the extent required to be (and
actually) delivered to Seller pursuant to the applicable Mortgage Loan
documents, copies of the following items: the Mortgage Note, any Mortgage, the
Assignment of Leases and the Assignment of Mortgage, any guaranty/indemnity
agreement, any loan agreement, the insurance policies or certificates, as
applicable, the property inspection reports, any financial statements on the
property, any escrow analysis, the tax bills, the Appraisal, the environmental
report, the engineering report, the asset summary, financial information on the
Borrower/sponsor and any guarantors, any letters of credit, any intercreditor
agreement and any Environmental Insurance Policies. Notwithstanding the
foregoing, Seller shall not be required to deliver any draft documents, or any
attorney-client communications that are privileged communications or constitute
legal or other due diligence analyses, or internal communications of Seller or
its affiliates, or credit underwriting or other analyses or data. Delivery of
any of the foregoing documents to Primary Servicer shall be deemed a delivery to
Master Servicer and satisfy Seller's obligations under this subparagraph. Each
of the foregoing items may be delivered by Seller in electronic form, to the
extent such document is available in such form and such form is reasonably
acceptable to Master Servicer.
2.10 Upon the sale of the Mortgage Loans by Seller to Purchaser pursuant to this
Agreement, the ownership of each Mortgage Note, Mortgage and the other contents
of the related Mortgage File shall be vested in Purchaser and its assigns, and
the ownership of all records and documents constituting the Servicing File with
respect to the related Mortgage Loan prepared by or that come into the
possession of Seller shall immediately vest in Purchaser and its assigns, and
shall be delivered promptly by Seller to or on behalf of either Trustee or
Master Servicer as set forth herein, subject to the requirements of the Primary
Servicing Agreement. Seller's and Purchaser's records shall reflect the transfer
of each Mortgage Loan from Seller to Purchaser and its assigns as a sale.
2.11 It is the express intent of the parties hereto that the conveyance of the
Mortgage Loans and related property to Purchaser by Seller as provided in this
Section 2 be, and be construed as, an absolute sale of the Mortgage Loans and
related property. It is, further, not the intention of the parties that such
conveyance be deemed a pledge of the Mortgage Loans and related property by
Seller to Purchaser to secure a debt or other obligation of Seller. However, in
the event that, notwithstanding the intent of the parties, the Mortgage Loans or
any related property are held to
9
be the property of Seller, or if for any other reason this Agreement is held or
deemed to create a security interest in the Mortgage Loans or any related
property, then:
2.11.1 this Agreement shall be deemed to be a security agreement; and
2.11.2 the conveyance provided for in this Section 2 shall be deemed to be
a grant by Seller to Purchaser of a security interest in all of Seller's right,
title, and interest, whether now owned or hereafter acquired, in and to:
A. All accounts, general intangibles, chattel paper, instruments,
documents, money, deposit accounts, certificates of deposit, goods, letters
of credit, advices of credit and investment property consisting of, arising
from or relating to any of the following property: the Mortgage Loans
identified on the Mortgage Loan Schedule, including the related Mortgage
Notes, Mortgages, security agreements, and title, hazard and other
insurance policies, all distributions with respect thereto payable after
the Cut-Off Date, all substitute or replacement Mortgage Loans and all
distributions with respect thereto, and the Mortgage Files;
B. All accounts, general intangibles, chattel paper, instruments,
documents, money, deposit accounts, certificates of deposit, goods, letters
of credit, advices of credit, investment property and other rights arising
from or by virtue of the disposition of, or collections with respect to, or
insurance proceeds payable with respect to, or claims against other Persons
with respect to, all or any part of the collateral described in clause (A)
above (including any accrued discount realized on liquidation of any
investment purchased at a discount); and
C. All cash and non-cash proceeds of the collateral described in
clauses (A) and (B) above.
2.12 The possession by Purchaser or its designee of the Mortgage Notes, the
Mortgages, and such other goods, letters of credit, advices of credit,
instruments, money, documents, chattel paper or certificated securities shall be
deemed to be possession by the secured party or possession by a purchaser for
purposes of perfecting the security interest pursuant to the Uniform Commercial
Code (including, without limitation, Sections 9-313 thereof) as in force in the
relevant jurisdiction. Notwithstanding the foregoing, Seller makes no
representation or warranty as to the perfection of any such security interest.
2.13 Notifications to Persons holding such property, and acknowledgments,
receipts, or confirmations from persons holding such property, shall be deemed
to be notifications to, or acknowledgments, receipts or confirmations from,
securities intermediaries, bailees or agents of, or Persons holding for,
Purchaser or its designee, as applicable, for the purpose of perfecting such
security interest under applicable law.
2.14 Seller shall, to the extent consistent with this Agreement and upon request
by or on behalf of Purchaser, take such reasonable actions as may be necessary
to ensure that, if this Agreement were deemed to create a security interest in
the property described above, such security interest would be deemed to be a
perfected security interest of first priority under applicable law and will
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be maintained as such throughout the term of the Agreement. In such case, Seller
hereby authorizes Master Servicer to file all filings necessary to maintain the
effectiveness of any original filings necessary under the Uniform Commercial
Code as in effect in any jurisdiction to perfect such security interest in such
property. In connection herewith, Purchaser shall have all of the rights and
remedies of a secured party and creditor under the Uniform Commercial Code as in
force in the relevant jurisdiction.
2.15 Notwithstanding anything to the contrary contained herein, and subject to
Section 2.1, Purchaser shall not be required to purchase any Mortgage Loan as to
which any Mortgage Note (endorsed as described in clause 2.2.1) required to be
delivered to or on behalf of Trustee or Master Servicer pursuant to this Section
2 on or before the Closing Date is not so delivered, or is not properly executed
or is defective on its face, and Purchaser's acceptance of the related Mortgage
Loan on the Closing Date shall in no way constitute a waiver of such omission or
defect or of Purchaser's or its successors' and assigns' rights in respect
thereof pursuant to Section 5.
3. EXAMINATION OF MORTGAGE FILES AND DUE DILIGENCE REVIEW.
3.1 Seller shall (i) deliver to Purchaser on or before the Closing Date a
diskette acceptable to Purchaser that contains such information about the
Mortgage Loans as may be reasonably requested by Purchaser, (ii) deliver to
Purchaser investor files (collectively the "Collateral Information") with
respect to the assets proposed to be included in the Mortgage Pool and made
available at Purchaser's headquarters in New York, and (iii) otherwise cooperate
fully with Purchaser in its examination of the credit files, underwriting
documentation and Mortgage Files for the Mortgage Loans and its due diligence
review of the Mortgage Loans. The fact that Purchaser has conducted or has
failed to conduct any partial or complete examination of the credit files,
underwriting documentation or Mortgage Files for the Mortgage Loans shall not
affect the right of Purchaser or Trustee to cause Seller to cure any Material
Document Defect or Material Breach (each as defined below), or to repurchase or
replace the defective Mortgage Loans pursuant to Section 5 hereof.
3.2 On or prior to the Closing Date, Seller shall allow representatives of any
of Purchaser, each Underwriter, each Initial Purchaser, Trustee, Special
Servicer and each Rating Agency to examine and audit all books, records and
files pertaining to the Mortgage Loans, Seller's underwriting procedures and
Seller's ability to perform or observe all of the terms, covenants and
conditions of this Agreement. Such examinations and audits shall take place at
one or more offices of Seller during normal business hours and shall not be
conducted in a manner that is disruptive to Seller's normal business operations
upon reasonable prior advance notice. In the course of such examinations and
audits, Seller will make available to such representatives of any of Purchaser,
each Underwriter, each Initial Purchaser, Trustee, Special Servicer and each
Rating Agency reasonably adequate facilities, as well as the assistance of a
sufficient number of knowledgeable and responsible individuals who are familiar
with the Mortgage Loans and the terms of this Agreement, and Seller shall
cooperate fully with any such examination and audit in all material respects. On
or prior to the Closing Date, Seller shall provide Purchaser with all material
information regarding Seller's financial condition and access to knowledgeable
financial or accounting officers for the purpose of answering questions with
respect to Seller's financial
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condition, financial statements as provided to Purchaser or other developments
affecting Seller's ability to consummate the transactions contemplated hereby or
otherwise affecting Seller in any material respect. Within 45 days after the
Closing Date, Seller shall provide Master Servicer or Primary Servicer, if
applicable, with any additional information identified by Master Servicer or
Primary Servicer, if applicable, as necessary to complete the CMSA Property
File, to the extent that such information is available.
3.3 Purchaser may exercise any of its rights hereunder through one or more
designees or agents, provided Purchaser has provided Seller with prior notice of
the identity of such designee or agent.
3.4 Purchaser shall keep confidential any information regarding Seller and the
Mortgage Loans that has been delivered into Purchaser's possession and that is
not otherwise publicly available; provided, however, that such information shall
not be kept confidential (and the right to require confidentiality under any
confidentiality agreement is hereby waived) to the extent such information is
required to be included in the Memorandum or the Prospectus Supplement or
Purchaser is required by law or court order to disclose such information. If
Purchaser is required to disclose in the Memorandum or the Prospectus Supplement
confidential information regarding Seller as described in the preceding
sentence, Purchaser shall provide to Seller a copy of the proposed form of such
disclosure prior to making such disclosure and Seller shall promptly, and in any
event within two Business Days, notify Purchaser of any inaccuracies therein, in
which case Purchaser shall modify such form in a manner that corrects such
inaccuracies. If Purchaser is required by law or court order to disclose
confidential information regarding Seller as described in the second preceding
sentence, Purchaser shall notify Seller and cooperate in Seller's efforts to
obtain a protective order or other reasonable assurance that confidential
treatment will be accorded such information and, if in the absence of a
protective order or such assurance, Purchaser is compelled as a matter of law to
disclose such information, Purchaser shall, prior to making such disclosure,
advise and consult with Seller and its counsel as to such disclosure and the
nature and wording of such disclosure and Purchaser shall use reasonable efforts
to obtain confidential treatment therefor. Notwithstanding the foregoing, if
reasonably advised by counsel that Purchaser is required by a regulatory agency
or court order to make such disclosure immediately, then Purchaser shall be
permitted to make such disclosure without prior review by Seller.
4. REPRESENTATIONS AND WARRANTIES OF SELLER AND PURCHASER.
4.1 To induce Purchaser to enter into this Agreement, Seller hereby makes for
the benefit of Purchaser and its assigns with respect to each Mortgage Loan
(subject to the last paragraph of this Section 4.1) as of the date hereof (or as
of such other date specifically set forth in the particular representation and
warranty) each of the representations and warranties set forth on Exhibit 2
hereto, except as otherwise set forth on Schedule A attached thereto, and hereby
further represents and warrants to Purchaser as of the date hereof that:
4.1.1 Seller is duly organized and is validly existing as a national
banking association in good standing under the laws of the United States. Seller
has the requisite power and authority and legal right to own the Mortgage Loans
and to transfer and convey the Mortgage Loans to
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Purchaser and has the requisite power and authority to execute and deliver,
engage in the transactions contemplated by, and perform and observe the terms
and conditions of, this Agreement.
4.1.2 This Agreement has been duly and validly authorized, executed and
delivered by Seller, and assuming the due authorization, execution and delivery
hereof by Purchaser, this Agreement constitutes the valid, legal and binding
agreement of Seller, enforceable in accordance with its terms, except as such
enforcement may be limited by (A) laws relating to bankruptcy, insolvency,
reorganization, receivership or moratorium, (B) other laws relating to or
affecting the rights of creditors generally, (C) general equity principles
(regardless of whether such enforcement is considered in a proceeding in equity
or at law) or (D) public policy considerations underlying the securities laws,
to the extent that such public policy considerations limit the enforceability of
the provisions of this Agreement that purport to provide indemnification from
liabilities under applicable securities laws.
4.1.3 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 Seller with this Agreement, or the consummation by Seller of any
transaction contemplated hereby, other than (A) such qualifications as may be
required under state securities or blue sky laws, (B) the filing or recording of
financing statements, instruments of assignment and other similar documents
necessary in connection with Seller's sale of the Mortgage Loans to Purchaser,
(C) such consents, approvals, authorizations, qualifications, registrations,
filings or notices as have been obtained and (D) where the lack of such consent,
approval, authorization, qualification, registration, filing or notice would not
have a material adverse effect on the performance by Seller under this
Agreement.
4.1.4 Neither the transfer of the Mortgage Loans to Purchaser, nor the
execution, delivery or performance of this Agreement by Seller, conflicts or
will conflict with, results or will result in a breach of, or constitutes or
will constitute a default under (A) any term or provision of Seller's articles
of organization or by-laws, (B) any term or provision of any material agreement,
contract, instrument or indenture to which Seller is a party or by which it or
any of its assets is bound or results in the creation or imposition of any lien,
charge or encumbrance upon any of its property pursuant to the terms of any such
indenture, mortgage, contract or other instrument, other than pursuant to this
Agreement, or (C) after giving effect to the consents or taking of the actions
contemplated in subsection 4.1.3, any law, rule, regulation, order, judgment,
writ, injunction or decree of any court or governmental authority having
jurisdiction over Seller or its assets, except where in any of the instances
contemplated by clauses (B) or (C) above, any conflict, breach or default, or
creation or imposition of any lien, charge or encumbrance, will not have a
material adverse effect on the consummation of the transactions contemplated
hereby by Seller or materially and adversely affect its ability to perform its
obligations and duties hereunder or result in any material adverse change in the
business, operations, financial condition, properties or assets of Seller, or in
any material impairment of the right or ability of Seller to carry on its
business substantially as now conducted.
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4.1.5 There are no actions or proceedings against, or investigations of,
Seller pending or, to Seller's knowledge, threatened in writing against Seller
before any court, administrative agency or other tribunal, the outcome of which
could reasonably be expected to materially and adversely affect the transfer of
the Mortgage Loans to Purchaser or the execution or delivery by, or
enforceability against, Seller of this Agreement or have an effect on the
financial condition of Seller that would materially and adversely affect the
ability of Seller to perform its obligations under this Agreement.
4.1.6 On the Closing Date, the sale of the Mortgage Loans pursuant to this
Agreement will effect a transfer by Seller of all of its right, title and
interest in and to the Mortgage Loans to Purchaser.
4.1.7 To Seller's knowledge, Seller's Information (as defined in that
certain indemnification agreement, dated August 8, 2006, between Seller,
Purchaser, the Underwriters and the Initial Purchaser (the "Indemnification
Agreement")) relating to the Mortgage Loans does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements therein, in the light of the circumstances under which they were
made, not misleading (when read together with the Final Prospectus Supplement,
in the case of Public Certificates, or when read together with the Memorandum,
in the case of the Private Certificates). Notwithstanding anything contained
herein to the contrary, this subparagraph 4.1.7 shall run exclusively to the
benefit of Purchaser and no other party.
To induce Purchaser to enter into this Agreement, Seller hereby covenants that
the foregoing representations and warranties and those set forth on Exhibit 2
hereto, subject to the exceptions set forth in Schedule A to Exhibit 2, will be
true and correct in all material respects on and as of the Closing Date with the
same effect as if made on the Closing Date, provided that any representations
and warranties made as of a specified date shall be true and correct in all
material respects as of such specified date.
4.1.8 Seller has complied with the disclosure requirements of Regulation AB
that arise from its role as "seller" and "sponsor" in connection with the
issuance of the Certificates.
4.1.9 For so long as the Trust is subject to the reporting requirements of
the Exchange Act, Seller shall provide Purchaser (or with respect to any
Serviced Companion Mortgage Loan that is deposited into an Other Securitization,
the depositor in such Other Securitization) and the Paying Agent with any
Additional Form 10-D Disclosure and any Additional Form 10-K Disclosure set
forth next to Seller's name on Schedule XV and Schedule XVI of the Pooling and
Servicing Agreement within the time periods set forth in the Pooling and
Servicing Agreement.
Each of the representations, warranties and covenants made by Seller pursuant to
this Section 4.1 shall survive the sale of the Mortgage Loans and shall continue
in full force and effect notwithstanding any restrictive or qualified
endorsement on the Mortgage Notes.
4.2 To induce Seller to enter into this Agreement, Purchaser hereby represents
and warrants to Seller as of the date hereof:
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4.2.1 Purchaser is a corporation duly organized, validly existing, and in
good standing under the laws of the State of Delaware with full power and
authority to carry on its business as presently conducted by it.
4.2.2 Purchaser has full power and authority to acquire the Mortgage Loans,
to execute and deliver this Agreement and to enter into and consummate all
transactions contemplated by this Agreement. Purchaser has duly and validly
authorized the execution, delivery and performance of this Agreement and has
duly and validly executed and delivered this Agreement. This Agreement, assuming
due authorization, execution and delivery by Seller, constitutes the valid and
binding obligation of Purchaser, enforceable against it in accordance with its
terms, except as such enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium and other similar laws affecting the enforcement of
creditors' rights generally and by general principles of equity, regardless of
whether such enforcement is considered in a proceeding in equity or at law.
4.2.3 No consent, approval, authorization or order of, registration or
filing with, or notice to, any governmental authority or court is required,
under federal or state law, for the execution, delivery and performance of or
compliance by Purchaser with this Agreement, or the consummation by Purchaser of
any transaction contemplated hereby that has not been obtained or made by
Purchaser.
4.2.4 Neither the purchase of the Mortgage Loans nor the execution,
delivery and performance of this Agreement by Purchaser will violate Purchaser's
certificate of incorporation or by-laws or constitute a default (or an event
that, with notice or lapse of time or both, would constitute a default) under,
or result in a breach of, any material agreement, contract, instrument or
indenture to which Purchaser is a party or that may be applicable to Purchaser
or its assets.
4.2.5 Purchaser's execution and delivery of this Agreement and its
performance and compliance with the terms of this Agreement will not constitute
a violation of any law, rule, writ, injunction, order or decree of any court, or
order or regulation of any federal, state or municipal government agency having
jurisdiction over Purchaser or its assets, which violation could materially and
adversely affect the condition (financial or otherwise) or the operation of
Purchaser or its assets or could materially and adversely affect its ability to
perform its obligations and duties hereunder.
4.2.6 There are no actions or proceedings against, or investigations of,
Purchaser pending or, to Purchaser's knowledge, threatened against Purchaser
before any court, administrative agency or other tribunal, the outcome of which
could reasonably be expected to adversely affect the transfer of the Mortgage
Loans, the issuance of the Certificates, the execution, delivery or
enforceability of this Agreement or have an effect on the financial condition of
Purchaser that would materially and adversely affect the ability of Purchaser to
perform its obligation under this Agreement.
4.2.7 Purchaser has not dealt with any broker, investment banker, agent or
other person, other than Seller, the Underwriters, the Initial Purchasers and
their respective affiliates, that may be entitled to any commission or
compensation in connection with the sale of the Mortgage Loans or consummation
of any of the transactions contemplated hereby.
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To induce Seller to enter into this Agreement, Purchaser hereby covenants that
the foregoing representations and warranties will be true and correct in all
material respects on and as of the Closing Date with the same effect as if made
on the Closing Date.
Each of the representations and warranties made by Purchaser pursuant to this
Section 4.2 shall survive the purchase of the Mortgage Loans.
5. REMEDIES UPON BREACH OF REPRESENTATIONS AND WARRANTIES MADE BY SELLER.
5.1 It is hereby acknowledged that Seller shall make for the benefit of Trustee
on behalf of the holders of the Certificates, whether directly or by way of
Purchaser's assignment of its rights hereunder to Trustee, the representations
and warranties set forth on Exhibit 2 hereto (each as of the date hereof unless
otherwise specified).
5.2 It is hereby further acknowledged that if any document required to be
delivered to Trustee pursuant to Section 2 is not delivered as and when required
(and including the expiration of any grace or cure period), is not properly
executed or is defective on its face, or if there is a breach of any of the
representations and warranties required to be made by Seller regarding the
characteristics of the Mortgage Loans and/or the related Mortgaged Properties as
set forth in Exhibit 2 hereto, and in either case such defect or breach, either
(i) materially and adversely affects the interests of the holders of the
Certificates in the related Mortgage Loan, or (ii) both (A) the document defect
or breach materially and adversely affects the value of the Mortgage Loan and
(B) the Mortgage Loan is a Specially Serviced Mortgage Loan or Rehabilitated
Mortgage Loan (such a document defect described in the preceding clause (i) or
(ii), a "Material Document Defect" and such a breach described in the preceding
clause (i) or (ii) a "Material Breach"), the party discovering such Material
Document Defect or Material Breach shall promptly notify, in writing, the other
parties; provided that any breach of the representation and warranty contained
in paragraph 42 of such Exhibit 2 shall constitute a Material Breach only if
such prepayment premium or yield maintenance charge is not deemed "customary"
for commercial mortgage loans as evidenced by (i) an opinion of tax counsel to
such effect or (ii) a determination by the Internal Revenue Service that such
provision is not customary. Promptly (but in any event within three Business
Days) upon becoming aware of any such Material Document Defect or Material
Breach, Master Servicer shall, and Special Servicer may, request that Seller,
not later than 90 days from Seller's receipt of the notice of such Material
Document Defect or Material Breach, cure such Material Document Defect or
Material Breach, as the case may be, in all material respects; provided,
however, that if such Material Document Defect or Material Breach, as the case
may be, cannot be corrected or cured in all material respects within such 90 day
period, and such Material Document Defect or Material Breach would not cause the
Mortgage Loan to be other than a "qualified mortgage"(as defined in the Code)
but Seller is diligently attempting to effect such correction or cure, as
certified by Seller in an Officer's Certificate delivered to Trustee, then the
cure period will be extended for an additional 90 days unless, solely in the
case of a Material Document Defect, (x) the Mortgage Loan is, at the end of the
initial 90 day period, then a Specially Serviced Mortgage Loan and a Servicing
Transfer Event has occurred as a result of a monetary default or as described in
clause (ii) or clause (v) of the definition of "Servicing Transfer Event" in the
Pooling and Servicing Agreement and (y) the
16
Material Document Defect was identified in a certification delivered to Seller
by Trustee pursuant to Section 2.2 of the Pooling and Servicing Agreement not
less than 90 days prior to the delivery of the notice of such Material Document
Defect. The parties acknowledge that neither delivery of a certification or
schedule of exceptions to Seller pursuant to Section 2.2 of the Pooling and
Servicing Agreement or otherwise nor possession of such certification or
schedule by Seller shall, in and of itself, constitute delivery of notice of any
Material Document Defect or knowledge or awareness by Seller of any Material
Document Defect listed therein.
5.3 Seller hereby covenants and agrees that, if any such Material Document
Defect or Material Breach cannot be corrected or cured in all material respects
within the above cure periods, Seller shall, on or before the termination of
such cure periods, either (i) repurchase the affected Mortgage Loan or REO
Mortgage Loan from Purchaser or its assignee at the Purchase Price as defined in
the Pooling and Servicing Agreement, or (ii) if within the three-month period
commencing on the Closing Date (or within the two-year period commencing on the
Closing Date if the related Mortgage Loan is a "defective obligation" within the
meaning of Section 860G(a)(4)(B)(ii) of the Code and Treasury Regulation Section
1.860G-2(f)), at its option replace, without recourse, any Mortgage Loan or REO
Mortgage Loan to which such defect relates with a Qualifying Substitute Mortgage
Loan. If such Material Document Defect or Material Breach would cause the
Mortgage Loan to be other than a "qualified mortgage" (as defined in the Code),
then notwithstanding the previous sentence or the previous paragraph, repurchase
or substitution must occur within 90 days from the date Seller was notified of
the breach or defect. Seller agrees that any substitution shall be completed in
accordance with the terms and conditions of the Pooling and Servicing Agreement.
5.4 If (x) a Mortgage Loan is to be repurchased or replaced as contemplated
above (a "Defective Mortgage Loan"), (y) such Defective Mortgage Loan is
cross-collateralized and cross-defaulted with one or more other Mortgage Loans
("Crossed Mortgage Loans") and (z) the applicable document defect or breach does
not constitute a Material Document Defect or Material Breach, as the case may
be, as to such Crossed Mortgage Loans (without regard to this paragraph), then
the applicable document defect or breach (as the case may be) shall be deemed to
constitute a Material Document Defect or Material Breach, as the case may be, as
to each such Crossed Mortgage Loan for purposes of the above provisions, and
Seller shall be obligated to repurchase or replace each such Crossed Mortgage
Loan in accordance with the provisions above, unless, in the case of such breach
or document defect, (A) Seller provides a Nondisqualification Opinion to Trustee
at the expense of Seller if Trustee acting at the direction of the Controlling
Class determines that it would be usual and customary in accordance with
industry practice to obtain a Nondisqualification Opinion and (B) both of the
following conditions would be satisfied if Seller were to repurchase or replace
only those Mortgage Loans as to which a Material Breach or Material Document
Defect had occurred without regard to this paragraph (the "Affected Loan(s)"):
(i) the debt service coverage ratio for all such other Mortgage Loans (excluding
the Affected Loan(s)) for the four calendar quarters immediately preceding the
repurchase or replacement is not less than the greater of (A) the debt service
coverage ratio for all such Crossed Mortgage Loans (including the Affected
Loan(s)) set forth under the heading "NCF DSCR" in Appendix II to the Final
Prospectus Supplement and (B) 1.25x, and (ii) the loan-to-value ratio for all
such Crossed Mortgage Loans (excluding the Affected Loan(s)) is not greater than
the lesser of (A) the current loan-to-value ratio for all such Mortgage Loans
(including the Affected Loan(s)) set forth under the heading "Cut-Off Date
17
LTV" in Appendix II to the Final Prospectus Supplement and (B) 75%. The
determination of Master Servicer as to whether the conditions set forth above
have been satisfied shall be conclusive and binding in the absence of manifest
error. Master Servicer will be entitled to cause to be delivered, or direct
Seller to (in which case Seller shall) cause to be delivered to Master Servicer:
(A) an Appraisal of any or all of the related Mortgaged Properties for purposes
of determining whether the condition set forth in clause (ii) above has been
satisfied, in each case at the expense of Seller if the scope and cost of the
Appraisal is approved by Seller (such approval not to be unreasonably withheld)
and (B) an opinion of counsel that not requiring the repurchase of each such
other Mortgage Loan will not result in an Adverse REMIC Event.
5.5 With respect to any Defective Mortgage Loan, to the extent that Seller is
required to repurchase or substitute for such Defective Mortgage Loan (each, a
"Repurchased Loan") in the manner prescribed above while Trustee (as assignee of
Purchaser) continues to hold any Crossed Mortgage Loan that is
cross-collateralized and/or cross-defaulted (each, a "Cross-Collateralized
Loan") with such Repurchased Loan, Seller and Purchaser hereby agree to modify,
prior to such repurchase or substitution, the related Mortgage Loan documents in
a manner such that such affected Repurchased Loan, on the one hand, and any
related Cross-Collateralized Loans held by Trustee, on the other, would no
longer be cross-defaulted or cross-collateralized with one another; provided
that Seller shall have furnished Trustee, at the expense of Seller, a
nondisqualification opinion that such modification shall not cause an Adverse
REMIC Event; provided, further, that if such nondisqualification opinion cannot
be furnished, Seller and Purchaser agree that such repurchase or substitution of
only the Repurchased Loan, notwithstanding anything to the contrary herein,
shall not be permitted and Seller shall repurchase or substitute for the
Repurchased Loan and all related Cross-Collateralized Loans. Any reserve or
other cash collateral or letters of credit securing the Cross-Collateralized
Mortgage Loans shall be allocated between such Mortgage Loans in accordance with
the Mortgage Loan documents, or otherwise on a pro rata basis based upon their
outstanding Principal Balances. All other terms of the Mortgage Loans shall
remain in full force and effect, without any modification thereof. The
Mortgagors set forth on Schedule B to Exhibit 2 hereto are intended third-party
beneficiaries of the provisions set forth in this paragraph and the preceding
paragraph. The provisions of this paragraph and the preceding paragraph may not
be modified with respect to any Mortgage Loan without the related Mortgagor's
consent.
5.6 Upon occurrence (and after any applicable cure or grace period), any of the
following document defects shall be conclusively presumed materially and
adversely to affect the interests of Certificateholders in a Mortgage Loan and
be a Material Document Defect: (a) the absence from the Mortgage File of the
original signed Mortgage Note, unless the Mortgage File contains a signed lost
note affidavit and indemnity that appears to be regular on its face; (b) the
absence from the Mortgage File of the original signed Mortgage that appears to
be regular on its face, unless there is included in the Mortgage File a
certified copy of the Mortgage by the local authority with which the Mortgage
was recorded; or (c) the absence from the Mortgage File of the item specified in
paragraph 2.2.8. If any of the foregoing Material Document Defects is discovered
by the Custodian (or Trustee if there is no Custodian), Trustee (or as set forth
in Section 2.3(a) of the Pooling and Servicing Agreement, Master Servicer) will
take the steps described elsewhere in this Section, including the giving of
notices to the Rating Agencies and the parties hereto and making demand upon
Seller for the cure of the Material Document Defect or repurchase or replacement
of the related Mortgage Loan.
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5.7 If Seller disputes that a Material Document Defect or Material Breach exists
with respect to a Mortgage Loan or otherwise refuses (i) to effect a correction
or cure of such Material Document Defect or Material Breach, (ii) to repurchase
the affected Mortgage Loan from Purchaser or its assignee or (iii) to replace
such Mortgage Loan with a Qualifying Substitute Mortgage Loan, each in
accordance with this Agreement, then provided that (i) the period of time
provided for Seller to correct, repurchase or cure has expired and (ii) the
Mortgage Loan is then in default and is then a Specially Serviced Mortgage Loan,
Special Servicer may, subject to the Servicing Standard, modify, work-out or
foreclose, sell or otherwise liquidate (or permit the liquidation of) the
Mortgage Loan pursuant to Sections 9.5, 9.12, 9.15 and 9.36, as applicable, of
the Pooling and Servicing Agreement, while pursuing the repurchase claim. Seller
acknowledges and agrees that any modification of the Mortgage Loan pursuant to a
work-out shall not constitute a defense to any repurchase claim nor shall such
modification and work-out change the Purchase Price due from Seller for any
repurchase claim. Any sale of the Mortgage Loan, or foreclosure upon such
Mortgage Loan and sale of the REO Property, to a Person other than Seller shall
be without (i) recourse of any kind (either express or implied) by such Person
against Seller and (ii) representation or warranty of any kind (either express
or implied) by Seller to or for the benefit of such Person.
5.8 Seller shall have the right to purchase certain of the Mortgage Loans or REO
Properties, as applicable, in accordance with Section 9.36 of the Pooling and
Servicing Agreement.
5.9 The fact that a Material Document Defect or Material Breach is not
discovered until after foreclosure (but in all instances prior to the sale of
the related REO Property or Mortgage Loan) shall not prejudice any claim against
Seller for repurchase of the REO Mortgage Loan or REO Property. In such an
event, Master Servicer shall notify Seller of the discovery of the Material
Document Defect or Material Breach and Seller shall have 90 days to correct or
cure such Material Document Defect or Material Breach or purchase the REO
Property at the Purchase Price. After a final liquidation of the Mortgage Loan
or REO Mortgage Loan, if a court of competent jurisdiction issues a final order
after the expiration of any applicable appeal period that Seller is or was
obligated to repurchase the related Mortgage Loan or REO Mortgage Loan (a "Final
Judicial Determination") or Seller otherwise accepts liability, then, but in no
event later than the Termination of the Trust pursuant to Section 9.30 of the
Pooling and Servicing Agreement, Seller will be obligated to pay to the Trust
the difference between any Liquidation Proceeds received upon such liquidation
in accordance with the Pooling and Servicing Agreement (including those arising
from any sale to Seller) and the Purchase Price.
5.10 Notwithstanding anything to the contrary contained herein, in connection
with any sale or other liquidation of a Mortgage Loan or REO Property as
described in this Section 5, Special Servicer shall not receive a Liquidation
Fee from Seller (but may collect such Liquidation Fee from the related
Liquidation Proceeds as otherwise provided herein); provided, however, that in
the event Seller is obligated to repurchase the Mortgage Loan or REO Mortgaged
Property after a final liquidation of such Mortgage Loan or REO Property
pursuant to the immediately preceding paragraph, an amount equal to any
Liquidation Fee (calculated on the basis of Liquidation Proceeds) payable to
Special Servicer shall be included in the definition of "Purchase Price" in
respect of such Mortgage Loan or REO Mortgaged Property. Except as expressly set
forth above, no Liquidation Fee shall be payable in connection with a repurchase
of a Mortgage Loan by Seller.
19
5.11 The obligations of Seller set forth in this Section 5 to cure a Material
Document Defect or a Material Breach or repurchase or replace a defective
Mortgage Loan constitute the sole remedies of Purchaser or its assignees with
respect to a Material Document Defect or Material Breach in respect of an
outstanding Mortgage Loan; provided, that this limitation shall not in any way
limit Purchaser's rights or remedies upon breach of any other representation or
warranty or covenant by Seller set forth in this Agreement (other than those set
forth in Exhibit 2).
5.12 Notwithstanding the foregoing, in the event that there is a breach of the
representations and warranties set forth in paragraph 39 of Exhibit 2 hereto
because the underlying loan documents do not provide for the payment by the
Mortgagor of reasonable costs and expenses associated with the defeasance or
assumption of a Mortgage Loan, and the related Mortgagor's payments made for the
reasonable costs and expenses associated with the defeasance or assumption of a
Mortgage Loan are insufficient and cause the Trust to incur an Additional Trust
Expense in an amount equal to such reasonable costs and expenses not paid by
such Mortgagor, Seller hereby covenants and agrees to reimburse the Trust within
90 days of the receipt of notice of such breach in an amount sufficient to avoid
such Additional Trust Expense. The parties hereto acknowledge that such
reimbursement shall be Seller's sole obligation with respect to the breach
discussed in the previous sentence.
5.13 The Pooling and Servicing Agreement shall provide that Trustee (or Master
Servicer or Special Servicer on its behalf) shall give written notice promptly
(but in any event within three Business Days) to Seller of its discovery of any
Material Document Defect or Material Breach and prompt written notice to Seller
in the event that any Mortgage Loan becomes a Specially Serviced Mortgage Loan
(as defined in the Pooling and Servicing Agreement).
5.14 If Seller repurchases any Mortgage Loan pursuant to this Section 5,
Purchaser or its assignee, following receipt by Trustee of the Purchase Price
therefor, promptly shall deliver or cause to be delivered to Seller all Mortgage
Loan documents with respect to such Mortgage Loan, and each document that
constitutes a part of the Mortgage File that was endorsed or assigned to Trustee
shall be endorsed and assigned to Seller in the same manner such that Seller
shall be vested with legal and beneficial title to such Mortgage Loan, in each
case without recourse, including any property acquired in respect of such
Mortgage Loan or proceeds of any insurance policies with respect thereto.
6. CLOSING.
6.1 The closing of the sale of the Mortgage Loans shall be held at the offices
of Xxxxxx & Xxxxxxx LLP, 000 Xxxxx Xxxxxx, Xxx Xxxx, XX 00000 at 9:00 a.m., New
York time, on the Closing Date. The closing shall be subject to each of the
following conditions:
6.1.1 All of the representations and warranties of Seller and Purchaser
specified in Section 4 hereof (including, without limitation, the
representations and warranties set forth on Exhibit 2 hereto) shall be true and
correct as of the Closing Date, provided that any representations and warranties
made as of a specified date shall be true and correct as of such specified date
(to the extent of the standard, if any, set forth in each representation and
warranty).
20
6.1.2 All Closing Documents specified in Section 7 hereof, in such forms as
are agreed upon and reasonably acceptable to Seller or Purchaser, as applicable,
shall be duly executed and delivered by all signatories as required pursuant to
the respective terms thereof.
6.1.3 Seller shall have delivered and released to Purchaser or its designee
all documents required to be delivered to Purchaser as of the Closing Date
pursuant to Section 2 hereof.
6.1.4 The result of the examination and audit performed by Purchaser and
its affiliates pursuant to Section 3 hereof shall be satisfactory to Purchaser
and its affiliates in their sole determination and the parties shall have agreed
to the form and contents of Seller's Information to be disclosed in the
Memorandum and the Prospectus Supplement.
6.1.5 All other terms and conditions of this Agreement required to be
complied with on or before the Closing Date shall have been complied with, and
Seller and Purchaser shall have the ability to comply with all terms and
conditions and perform all duties and obligations required to be complied with
or performed after the Closing Date.
6.1.6 Seller shall have paid all fees and expenses payable by it to
Purchaser pursuant to Section 8 hereof.
6.1.7 The Certificates to be so rated shall have been assigned ratings by
each Rating Agency no lower than the ratings specified for each such Class in
the Memorandum and the Prospectus Supplement.
6.1.8 No Underwriter shall have terminated the Underwriting Agreement and
none of the Initial Purchasers shall have terminated the Certificate Purchase
Agreement, and neither the Underwriters nor the Initial Purchasers shall have
suspended, delayed or otherwise cancelled the Closing Date.
6.1.9 Seller shall have received the purchase price for the Mortgage Loans
pursuant to Section 1 hereof.
6.2 Each party agrees to use its best efforts to perform its respective
obligations hereunder in a manner that will enable Purchaser to purchase the
Mortgage Loans on the Closing Date.
7. CLOSING DOCUMENTS. The Closing Documents shall consist of the following:
7.1 This Agreement duly executed by Purchaser and Seller.
7.2 A certificate of Seller, executed by a duly authorized officer of Seller and
dated the Closing Date, and upon which Purchaser and its successors and assigns
may rely, to the effect that: (i) the representations and warranties of Seller
in this Agreement are true and correct in all material respects on and as of the
Closing Date with the same force and effect as if made on the Closing Date,
provided that any representations and warranties made as of a specified date
shall be true and correct as of such specified date; and (ii) Seller has
complied with all agreements and satisfied all conditions on its part to be
performed or satisfied on or prior to the Closing Date.
21
7.3 True, complete and correct copies of Seller's articles of organization and
by-laws or other organizational documents.
7.4 A certificate of existence for Seller from the Comptroller of the Currency
dated not earlier than 30 days prior to the Closing Date.
7.5 A certificate of the Secretary or Assistant Secretary of Seller, dated the
Closing Date, and upon which Purchaser may rely, to the effect that each
individual who, as an officer or representative of Seller, signed this Agreement
or any other document or certificate delivered on or before the Closing Date in
connection with the transactions contemplated herein, was at the respective
times of such signing and delivery, and is as of the Closing Date, duly elected
or appointed, qualified and acting as such officer or representative, and the
signatures of such persons appearing on such documents and certificates are
their genuine signatures.
7.6 An opinion of counsel (which, other than as to the opinion described in
paragraph 7.6.6 below, may be in-house counsel) to Seller, dated the Closing
Date, substantially to the effect of the following (with such changes and
modifications as Purchaser may approve and subject to such counsel's reasonable
qualifications):
7.6.1 Seller is validly existing under the law of the United States and has
national banking power and authority to enter into and perform its obligations
under this Agreement.
7.6.2 This Agreement has been duly authorized, executed and delivered by
Seller.
7.6.3 No consent, approval, authorization or order of any federal court or
governmental agency or body is required for the consummation by Seller of the
transactions contemplated by the terms of this Agreement except any approvals as
have been obtained.
7.6.4 Neither the execution, delivery or performance of this Agreement by
Seller, nor the consummation by Seller of any of the transactions contemplated
by the terms of this Agreement (A) conflicts with or results in a breach or
violation of, or constitutes a default under, the organizational documents of
Seller, (B) to the knowledge of such counsel, constitutes a default under any
term or provision of any material agreement, contract, instrument or indenture,
to which Seller is a party or by which it or any of its assets is bound or
results in the creation or imposition of any lien, charge or encumbrance upon
any of its property pursuant to the terms of any such indenture, mortgage,
contract or other instrument, other than pursuant to this Agreement, or (C)
conflicts with or results in a breach or violation of any law, rule, regulation,
order, judgment, writ, injunction or decree of any court or governmental
authority having jurisdiction over Seller or its assets, except where in any of
the instances contemplated by clauses (B) or (C) above, any conflict, breach or
default, or creation or imposition of any lien, charge or encumbrance, will not
have a material adverse effect on the consummation of the transactions
contemplated hereby by Seller or materially and adversely affect its ability to
perform its obligations and duties hereunder or result in any material adverse
change in the business, operations, financial condition, properties or assets of
Seller, or in any material impairment of the right or ability of Seller to carry
on its business substantially as now conducted.
22
7.6.5 To his or her knowledge, there are no legal or governmental actions,
investigations or proceedings pending to which Seller is a party, or threatened
against Seller, (a) asserting the invalidity of this Agreement or (b) which
materially and adversely affect the performance by Seller of its obligations
under, or the validity or enforceability of, this Agreement.
7.6.6 This Agreement is a valid, legal and binding agreement of Seller,
enforceable against Seller in accordance with its terms, except as such
enforcement may be limited by (1) laws relating to bankruptcy, insolvency,
reorganization, receivership or moratorium, (2) other laws relating to or
affecting the rights of creditors generally, (3) general equity principles
(regardless of whether such enforcement is considered in a proceeding in equity
or at law) or (4) public policy considerations underlying the securities laws,
to the extent that such public policy considerations limit the enforceability of
the provisions of this Agreement that purport to provide indemnification from
liabilities under applicable securities laws.
Such opinion may express its reliance as to factual matters on, among other
things specified in such opinion, the representations and warranties made by,
and on certificates or other documents furnished by officers of, the parties to
this Agreement.
In rendering the opinions expressed above, such counsel may limit such opinions
to matters governed by the federal laws of the United States and the corporate
laws of the State of Delaware and the State of New York, as applicable.
7.7 A "10b-5" opinion of counsel addressed to Purchaser and the Underwriters, in
form reasonably acceptable to Purchaser and the Underwriters, as to the
disclosure provided by Seller to Purchaser in connection with the Certificates.
7.8 An opinion of counsel addressed to Purchaser and the Underwriters, in form
reasonably acceptable to Purchaser and the Underwriters, that such disclosure
complies as to form with the applicable requirements of Regulation AB with
respect to Seller's role as Sponsor (as such term is defined in Regulation AB)
in connection with the Certificates. Such other opinions of counsel as any
Rating Agency may request in connection with the sale of the Mortgage Loans by
Seller to Purchaser or Seller's execution and delivery of, or performance under,
this Agreement.
7.9 A letter from Deloitte & Touche, certified public accountants, dated the
date hereof, to the effect that they have performed certain specified procedures
as a result of which they determined that certain information of an accounting,
financial or statistical nature set forth in the Memorandum and the Prospectus
Supplement agrees with the records of Seller.
7.10 Such further certificates, opinions and documents as Purchaser may
reasonably request.
7.11 An officer's certificate of Purchaser, dated as of the Closing Date, with
the resolutions of Purchaser authorizing the transactions described herein
attached thereto, together with certified copies of the charter, by-laws and
certificate of good standing of Purchaser dated not earlier than 30 days prior
to the Closing Date.
23
7.12 Such other certificates of Purchaser's officers or others and such other
documents to evidence fulfillment of the conditions set forth in this Agreement
as Seller or its counsel may reasonably request.
7.13 An executed Xxxx of Sale in the form attached hereto as Exhibit 4.
8. COSTS. Seller shall pay Purchaser the costs and expenses as agreed upon by
Seller and Purchaser in a separate Letter of Understanding dated August 8, 2006.
9. NOTICES. All communications provided for or permitted hereunder shall be in
writing and shall be deemed to have been duly given if (a) personally delivered,
(b) mailed by registered or certified mail, postage prepaid and received by the
addressee, (c) sent by express courier delivery service and received by the
addressee, or (d) transmitted by telex or facsimile transmission (or any other
type of electronic transmission agreed upon by the parties) and confirmed by a
writing delivered by any of the means described in (a), (b) or (c), if (i) to
Purchaser, addressed to Xxxxxx Xxxxxxx Capital I Inc., 0000 Xxxxxxxx, Xxx Xxxx,
Xxx Xxxx 00000, Attention: Xxxxxx Friend (or such other address as may hereafter
be furnished in writing by Purchaser), or if (ii) to Seller, addressed to Seller
at LaSalle Bank National Association, 000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000,
Xxxxxxx, Xxxxxxxx 00000, Attention: Xxxx Xxxxxxx, fax number: (000) 000-0000.
10. SEVERABILITY OF PROVISIONS. Any part, provision, representation, warranty or
covenant of this Agreement that is prohibited or that is held to be void or
unenforceable shall be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof. Any part,
provision, representation, warranty or covenant of this Agreement that is
prohibited or unenforceable or is held to be void or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction. To the extent permitted by applicable law, the parties
hereto waive any provision of law that prohibits or renders void or
unenforceable any provision hereof.
11. FURTHER ASSURANCES. Seller and Purchaser each agree to execute and deliver
such instruments and take such actions as the other may, from time to time,
reasonably request in order to effectuate the purpose and to carry out the terms
of this Agreement and the Pooling and Servicing Agreement.
12. SURVIVAL. Each party hereto agrees that the representations, warranties and
agreements made by it herein and in any certificate or other instrument
delivered pursuant hereto shall be deemed to be relied upon by the other party,
notwithstanding any investigation heretofore or hereafter made by the other
party or on its behalf, and that the representations, warranties and agreements
made by such other party herein or in any such certificate or other instrument
shall survive the delivery of and payment for the Mortgage Loans and shall
continue
24
in full force and effect, notwithstanding any restrictive or qualified
endorsement on the Mortgage Notes and notwithstanding subsequent termination of
this Agreement.
13. GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS, DUTIES, OBLIGATIONS AND
RESPONSIBILITIES OF THE PARTIES HERETO SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS AND DECISIONS OF THE STATE OF NEW YORK. THE
PARTIES HERETO INTEND THAT THE PROVISIONS OF SECTION 5-1401 OF THE NEW YORK
GENERAL OBLIGATIONS LAW SHALL APPLY TO THIS AGREEMENT.
14. BENEFITS OF MORTGAGE LOAN PURCHASE AGREEMENT. This Agreement shall inure to
the benefit of and shall be binding upon Seller, Purchaser and their respective
successors, legal representatives, and permitted assigns, and nothing expressed
or mentioned in this Agreement is intended or shall be construed to give any
other person any legal or equitable right, remedy or claim under or in respect
of this Agreement, or any provisions herein contained, this Agreement and all
conditions and provisions hereof being intended to be and being for the sole and
exclusive benefit of such persons and for the benefit of no other person except
that the rights and obligations of Purchaser pursuant to Sections 2, 4.1 (other
than clause 4.1.7), 5, 9, 10, 11, 12 and 13 hereof may be assigned to Trustee as
may be required to effect the purposes of the Pooling and Servicing Agreement
and, upon such assignment, Trustee shall succeed to the rights and obligations
hereunder of Purchaser. No owner of a Certificate issued pursuant to the Pooling
and Servicing Agreement shall be deemed a successor or permitted assigns because
of such ownership.
15. MISCELLANEOUS. This Agreement may be executed in two or more counterparts,
each of which when so executed and delivered shall be an original, but all of
which together shall constitute one and the same instrument. Neither this
Agreement nor any term hereof may be changed, waived, discharged or terminated
orally, but only by an instrument in writing signed by the party against whom
enforcement of the change, waiver, discharge or termination is sought. The
headings in this Agreement are for purposes of reference only and shall not
limit or otherwise affect the meaning hereof. The rights and obligations of
Seller under this Agreement shall not be assigned by Seller without the prior
written consent of Purchaser, except that any person into which Seller may be
merged or consolidated, or any corporation resulting from any merger, conversion
or consolidation to which Seller is a party, or any person succeeding to the
entire business of Seller shall be the successor to Seller hereunder.
16. ENTIRE AGREEMENT. This Agreement contains the entire agreement and
understanding between the parties hereto with respect to the subject matter
hereof (other than the Letter of Understanding (solely with respect to those
portions of this Agreement that are not assigned to Trustee), the
Indemnification Agreement and the Pooling and Servicing Agreement), and
supersedes all prior and contemporaneous agreements, understandings, inducements
and conditions, express or implied, oral or written, of any nature whatsoever
with respect to the
25
subject matter hereof. The express terms hereof control and supersede any course
of performance or usage of the trade inconsistent with any of the terms hereof.
26
IN WITNESS WHEREOF, Purchaser and Seller have caused this Agreement to be
executed by their respective duly authorized officers as of the date first above
written.
LASALLE BANK NATIONAL ASSOCIATION
By: /s/ Xxxxx X. Xxxxxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: VP Director of Structured
Products
XXXXXX XXXXXXX CAPITAL I INC.
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
EXHIBIT 1
MORTGAGE LOAN SCHEDULE
MSCI 2006-HQ8
MORTGAGE SCHEDULE
ORIGINAL REMAINING ORIGINAL
MORTGAGE MORTGAGE CUT-OFF DATE TERM TO TERM TO AMORT.
LOAN NO. LOAN SELLER PROPERTY NAME BALANCE NOTE DATE MATURITY MATURITY TERM
-------------------------------------------------------------------------------------------------------------------------------
2 LaSalle 000 Xxxxxxxx Xxxxxx $225,000,000 06/30/2006 120 000 XX
00 XxXxxxx XXX Xxxxxxxxxx Xxxxxxxxx - Xxxxxxx (XXX) $ 16,159,686 02/21/2006 72 00 XX
00 XxXxxxx XXX Xxxxxxxxxx Xxxxxxxxx - XxXxxx (XXX) $ 9,738,220 02/21/2006 72 00 XX
00 XxXxxxx XXX Xxxxxxxxxx Xxxxxxxxx - Xxxxxxxxx (XXX) $ 9,738,220 02/21/2006 72 00 XX
00 XxXxxxx XXX Xxxxxxxxxx Xxxxxxxxx - XxXxxxxxx (XXX) $ 8,520,942 02/21/2006 72 00 XX
00 XxXxxxx XXX Xxxxxxxxxx Xxxxxxxxx - Xxxxxxxx (XXX) $ 3,610,995 02/21/2006 72 00 XX
00 XxXxxxx XXX Xxxxxxxxxx Xxxxxxxxx - Xxxxxxxxx (XXX) $ 2,231,937 02/21/2006 72 67 IO
67 LaSalle Cornerstone at Xxxxxxx Office $ 41,000,000 06/26/2006 120 119 360
75 LaSalle Xxx Xxxxxx Xxxxx Xxxxxxx - 000 Xxxxx Xxxxxxxx $ 15,289,466 07/12/2006 120 120 360
Street (VII)
00 XxXxxxx Xxx Xxxxxx Xxxxx Xxxxxxx - 000 Xxxxx Centennial $ 7,531,466 07/12/2006 120 120 360
Street (VII)
77 LaSalle The Center Point Complex - 000 Xxxxxxx Xxxxxx $ 5,501,974 07/12/2006 120 120 360
(VII)
78 LaSalle Xxx Xxxxxx Xxxxx Xxxxxxx - 000 Xxxx Xxxxxxx $ 2,709,094 07/12/2006 120 120 360
Avenue (VII)
00 XxXxxxx Xxxxxx Xxxxxx Xxxxxx (VIII) $ 18,400,485 04/26/2006 120 117 360
00 XxXxxxx 000 Xxxx Xxxx (XXXX) $ 10,099,515 04/26/2006 120 117 360
00 XxXxxxx Xxxx Xxxxxxx Xxxxxxxx $ 28,100,000 05/15/2006 60 58 IO
00 XxXxxxx Xxxxxxx Xxxxx $ 25,200,000 05/23/2006 60 58 360
85 LaSalle Commerce Tower $ 21,500,000 04/21/2006 120 117 360
00 XxXxxxx Xxxxxxxxxx Xxxxxxxx Xxxxxx $ 18,482,120 06/13/2006 120 119 360
00 XxXxxxx Xxxxxxxxx Xxxxxxx $ 18,200,000 06/29/2006 120 119 360
REMAINING MONTHLY MONTHLY PREPAYMENT CODE
MORTGAGE AMORT. MORTGAGE PAYMENT PAYMENT ------------------------------------- ADMINISTRATIVE TRUSTEE
LOAN NO. TERM RATE (P&I) (IO) SEASONING LO DEF DEF/YM1.00 YM1.00 YM OPEN COST RATE FEE RATE
--------------------------------------------------------------------------------------------------------------------------------
2 IO 6.192% NAP $1,177,125 1 25 88 7 2.088
18 IO 6.107% NAP $ 83,386 5 29 39 4 2.088
19 IO 6.107% NAP $ 50,250 5 29 39 4 2.088
20 IO 6.107% NAP $ 50,250 5 29 39 4 2.088
21 IO 6.107% NAP $ 43,969 5 29 39 4 2.088
22 IO 6.107% NAP $ 18,633 5 29 39 4 2.088
23 IO 6.107% NAP $ 11,517 5 29 39 4 2.088
67 360 6.290% $253,512 $ 217,893 1 25 93 2 2.088
75 360 6.430% $ 95,937 $ 83,064 0 24 94 2 7.088
76 360 6.430% $ 47,258 $ 40,917 0 24 94 2 7.088
77 360 6.430% $ 34,523 $ 29,891 0 24 94 2 7.088
78 360 6.430% $ 16,999 $ 14,718 0 24 94 2 7.088
80 360 6.150% $112,101 $ 95,612 3 27 90 3 3.088
81 360 6.150% $ 61,529 $ 52,479 3 27 90 3 3.088
82 IO 5.895% NAP $ 139,958 2 26 31 3 7.088
83 360 6.030% $151,573 $ 128,389 2 26 30 4 2.088
85 360 6.120% $130,567 $ 111,173 3 27 90 3 3.088
88 359 5.395% $103,825 NAP 1 25 92 3 2.088
94 360 6.130% $110,644 $ 94,263 1 25 92 3 2.088
EXCESS
MORTGAGE SERVICING MORTGAGE
LOAN NO. FEE RATE LOAN NO.
-----------------------------
2 2
18 18
19 19
20 20
21 21
22 22
23 23
67 67
75 75
76 76
77 77
78 78
80 80
81 81
82 82
83 83
85 85
88 88
94 94
1-1
98 LaSalle 122 West Xxxx Xxxxxxxxx $16,000,000 04/28/2006 120 117 360
100 LaSalle Aspen Pointe Apartments $15,000,000 05/31/2006 120 118 360
103 LaSalle 000 Xxxx Xxxxx Xxxxxx $14,850,000 03/31/2006 120 116 360
104 LaSalle Giant Food - Bucks County $14,847,845 06/13/2006 120 119 360
107 LaSalle Xxxxxx Xxxxxx $13,500,000 05/24/2006 120 118 360
108 XxXxxxx 00 Xxxx Xxxxxx Xxxxxxxx $13,000,000 06/08/2006 120 119 360
109 LaSalle Village Squire Apartments $12,000,000 06/27/2006 120 119 360
000 XxXxxxx Xxxxxxxxx xx Xxxxxxxx - Xxxx Xxxxx $10,670,874 05/18/2006 120 118 300
119 LaSalle Holiday Inn Express - Rapid City (IX) $ 5,807,874 06/01/2006 120 118 240
120 LaSalle Holiday Inn Express - Bismarck (IX) $ 3,953,259 06/01/2006 120 118 240
121 LaSalle Holiday Inn Express - Aberdeen (X) $ 3,651,500 05/19/2006 120 118 216
122 LaSalle Holiday Inn Express - Xxxxxxxxx (X) $ 3,376,088 05/19/2006 120 118 216
123 LaSalle Holiday Inn Express - Watertown (X) $ 2,690,569 05/19/2006 120 118 216
124 LaSalle Textile Building $ 9,700,000 06/27/2006 120 119 360
125 LaSalle Morrowood Townhomes $ 9,500,000 05/31/2006 120 118 360
127 LaSalle Holiday Inn Express - Morgantown (XI) $ 3,197,819 06/22/2006 120 119 240
128 LaSalle SpringHill Suites - Morgantown (XI) $ 3,009,184 06/22/2006 120 119 240
129 LaSalle Holiday Inn Express - Winfield (XI) $ 2,775,635 06/22/2006 120 119 240
131 LaSalle Xxxxxx MHP $ 7,794,483 06/02/2006 120 119 360
000 XxXxxxx Xxxxxxx Xxxxxx - Xxxxxxxxxx $ 7,180,401 05/18/2006 120 118 300
000 XxXxxxx Xxxxx Xxxxx Xxxxxxx $ 6,450,000 05/09/2006 120 118 360
000 XxXxxxx Xxxxxxx Xxxxxx - Xxx Xxxx $ 6,332,715 05/18/2006 120 118 300
000 XxXxxxx Xxxxxx - Frontier $ 6,000,000 05/16/2006 120 118 360
000 XxXxxxx Xxxxxxxx Xxxxxxx $ 5,850,000 05/17/2006 120 118 360
164 LaSalle Fishers Corner $ 4,951,656 05/15/2006 120 118 360
167 LaSalle Xxxxx Office $ 4,575,000 05/25/2006 120 118 360
169 LaSalle 000 Xxxxxx Xxxxxx $ 4,492,110 05/31/2006 120 118 360
171 LaSalle Central Self-Storage $ 4,391,361 05/24/2006 120 118 360
98 360 5.805% $93,931 $78,475 3 27 89 4 2.088
100 360 6.080% $90,706 $77,056 2 26 92 2 9.088
103 360 5.570% $84,970 $69,886 4 28 88 4 2.088
104 359 6.050% $89,571 NAP 1 25 92 3 2.088
107 360 5.980% $80,766 $68,209 2 26 92 2 2.088
108 360 6.235% $79,916 $68,484 1 25 94 1 7.088
109 360 6.010% $72,023 $60,935 1 25 94 1 2.088
116 298 6.010% $69,006 NAP 2 26 92 2 2.088
119 238 6.390% $43,098 NAP 2 26 91 3 2.088
120 238 6.390% $29,335 NAP 2 26 91 3 2.088
121 214 6.380% $28,608 NAP 2 26 91 3 2.088
122 214 6.380% $26,450 NAP 2 26 91 3 2.088
123 214 6.380% $21,079 NAP 2 26 91 3 2.088
124 360 6.360% $60,420 $52,124 1 25 92 3 6.088
125 360 6.100% $57,570 $48,962 2 26 92 2 9.088
127 239 6.244% $23,408 NAP 1 25 92 3 2.088
128 239 6.244% $22,027 NAP 1 25 92 3 2.088
129 239 6.244% $20,317 NAP 1 25 92 3 2.088
131 359 6.580% $49,712 NAP 1 25 92 3 2.088
140 298 6.010% $46,434 NAP 2 26 92 2 2.088
149 360 5.890% $38,216 $32,098 2 26 91 3 2.088
153 298 6.010% $40,952 NAP 2 26 92 2 2.088
154 360 6.270% $37,021 $31,785 2 35 82 3 7.088
156 360 6.040% $35,224 $29,854 2 26 91 3 2.088
164 358 6.370% $30,928 NAP 2 26 91 3 2.088
167 360 6.336% $28,425 $24,492 2 26 91 3 2.088
169 358 6.189% $27,529 NAP 2 26 91 3 2.088
171 358 5.680% $25,482 NAP 2 26 91 3 7.088
98 98
100 100
103 103
104 104
107 107
108 108
109 109
116 116
119 119
120 120
121 121
122 122
123 123
124 124
125 125
127 127
128 128
129 129
131 131
140 140
149 149
153 153
154 154
156 156
164 164
167 167
169 169
171 171
1-2
000 XxXxxxx Xxxxxx Building $4,350,000 05/26/2006 120 118 360
000 XxXxxxx Xxxxxxxxx Self Storage $4,292,694 05/31/2006 120 118 360
174 LaSalle Quail Hollow Apartments $4,273,411 05/30/2006 120 118 360
177 LaSalle Fruit Cove Plaza $4,240,000 06/05/2006 120 119 360
179 LaSalle Bienville Tower Apartments $4,189,674 04/27/2006 120 117 360
181 LaSalle Xxxxxx Lake Apartments $4,100,000 04/28/2006 120 117 360
190 LaSalle Hunters Xxxx $3,837,105 06/02/2006 120 119 360
000 XxXxxxx Xxxxxxxx Xxxxxx Office $3,597,259 06/06/2006 120 119 360
199 LaSalle Fugazy Travel $3,547,489 06/16/2006 120 119 360
205 LaSalle One City Plaza $3,413,882 06/01/2006 120 118 360
215 LaSalle Advanced Self Storage $3,146,305 06/09/2006 120 119 300
224 LaSalle Fairfield Apartments $2,995,193 05/18/2006 120 118 360
225 LaSalle 0000 Xxxxx Xxxxxxxx Xxxx $2,994,931 05/31/2006 120 118 360
226 LaSalle Xxxxxxx Xxx Xxxxxxx - Xxxxxxxxxxxx, XX $2,993,341 05/18/2006 120 118 300
000 XxXxxxx Xxxxxxx Leisure RV Resort $2,960,000 05/05/2006 120 118 348
228 LaSalle Walgreens Phoenix $2,950,000 07/17/2006 120 120 IO
232 LaSalle Calexico Self Storage $2,915,146 05/30/2006 120 118 360
233 LaSalle Drive-Up Self Storage $2,895,200 05/31/2006 120 118 360
238 LaSalle Friendship Professional Center $2,820,269 05/18/2006 120 118 360
239 LaSalle Durango Plaza $2,800,000 07/06/2006 120 120 360
000 XxXxxxx Xxxxxxx Airport SS $2,700,000 06/22/2006 120 119 360
248 LaSalle South Xxxxxx Apartments $2,605,629 05/24/2006 120 118 360
251 LaSalle Eastside Self Storage $2,468,459 05/31/2006 120 118 300
253 LaSalle Lily Lake Terrace Apartments $2,413,203 06/20/2006 120 119 360
254 LaSalle Madison Building $2,413,118 06/12/2006 120 119 360
259 LaSalle Sunset Apartments (XIV) $1,286,891 05/26/2006 120 118 360
260 LaSalle Commander Apartments (XIV) $ 934,318 05/26/2006 120 118 360
000 XxXxxxx Xxxxxxx Xxxxxxxx Xxxxxx $2,175,000 06/02/2006 120 119 360
172 360 5.809% $25,549 $21,350 2 26 92 2 10.088
173 358 6.327% $26,692 NAP 2 26 91 3 7.088
174 358 6.750% $27,760 NAP 2 26 91 3 2.088
177 360 6.170% $25,886 $22,103 1 35 83 2 2.088
179 357 6.340% $26,106 NAP 3 27 90 3 2.088
181 360 6.110% $24,872 $21,166 3 35 82 3 2.088
190 359 6.352% $23,899 NAP 1 25 92 3 2.088
197 359 6.316% $22,321 NAP 1 25 92 3 2.088
199 359 6.580% $22,626 NAP 1 35 82 3 10.088
205 358 6.100% $20,725 NAP 2 26 91 3 2.088
215 299 6.423% $21,118 NAP 1 25 92 3 6.088
224 358 6.580% $19,120 NAP 2 26 91 3 2.088
225 358 6.351% $18,669 NAP 2 26 91 3 10.088
226 298 7.150% $21,491 NAP 2 26 91 3 2.088
227 348 6.080% $18,118 $15,206 2 26 91 3 2.088
228 IO 6.170% NAP $15,379 0 24 93 3 2.088
232 358 6.422% $18,307 NAP 2 35 82 3 2.088
233 358 6.441% $18,218 NAP 2 26 91 3 2.088
238 358 6.390% $17,652 NAP 2 26 91 3 2.088
239 360 6.250% $17,240 NAP 0 24 93 3 2.088
244 360 6.361% $16,820 $14,511 1 25 92 3 2.088
248 358 6.390% $16,309 NAP 2 26 91 3 8.088
251 298 6.180% $16,220 NAP 2 26 91 3 2.088
253 359 6.400% $15,106 NAP 1 25 92 3 2.088
254 359 6.230% $14,838 NAP 1 25 92 3 2.088
259 358 6.315% $ 7,992 NAP 2 35 82 3 2.088
260 358 6.315% $ 5,802 NAP 2 35 82 3 2.088
261 360 6.360% $13,548 $11,688 1 25 92 3 2.088
172 172
173 173
174 174
177 177
179 179
181 181
190 190
197 197
199 199
205 205
215 215
224 224
225 225
226 226
227 227
228 228
232 232
233 233
238 238
239 239
244 244
248 248
251 251
253 253
254 254
259 259
260 260
261 261
1-3
265 LaSalle Intertech II Office $2,075,000 05/26/2006 120 118 360
266 LaSalle Alpine Village MHP $1,998,581 06/30/2006 120 119 360
268 LaSalle Remington Apartments $1,996,721 05/31/2006 120 118 360
000 XxXxxxx Xxxxxx Building $1,600,000 06/15/2006 120 119 360
278 LaSalle Woodlands Apartments $1,482,542 05/23/2006 120 118 360
279 LaSalle Elmwood Center $1,423,979 06/23/2006 120 119 360
280 LaSalle Autumn Creek Crossing Center $1,417,580 05/31/2006 120 118 360
281 LaSalle Atlas Self Storage $1,412,717 05/18/2006 120 118 360
283 LaSalle 0000 Xxxxxx Xxxxxx $1,240,000 07/14/2006 120 120 360
284 LaSalle Rite Aid-Xxxxxxx $1,234,646 04/28/2006 120 117 276
286 LaSalle All American Self Storage $1,057,315 05/18/2006 120 118 300
265 360 6.300% $12,844 $11,045 2 26 91 3 7.088
266 359 6.570% $12,734 NAP 1 25 92 3 2.088
268 358 6.482% $12,618 NAP 2 26 91 3 12.088
275 360 6.375% $ 9,982 $ 8,618 1 25 92 3 12.088
278 358 6.440% $ 9,328 NAP 2 26 91 3 2.088
279 359 6.533% $ 9,038 NAP 1 25 92 3 2.088
280 358 6.313% $ 8,801 NAP 2 26 91 3 9.088
281 358 6.550% $ 8,990 NAP 2 35 82 3 2.088
283 360 6.480% $ 7,821 NAP 0 24 93 3 2.088
284 273 6.593% $ 8,739 NAP 3 27 90 3 2.088
286 298 6.420% $ 7,104 NAP 2 26 91 3 7.088
265 265
266 266
268 268
275 275
278 278
279 279
280 280
281 281
283 283
284 284
286 286
MSCI 2006-HQ9
MORTGAGE SCHEDULE
-----------------------------------------------------------------------------------------------------------------------------------
MORTGAGE MORTGAGE CUT-OFF DATE ORIGINAL TERM REMAINING TERM
LOAN NO. LOAN SELLER PROPERTY NAME BALANCE NOTE DATE TO MATURITY TO MATURITY
-----------------------------------------------------------------------------------------------------------------------------------
LaSalle 000 00xx Xxxxxx X Note $18,000,000 12/09/2005 120 113
LaSalle DCT Industrial Portfolio C Note $16,159,686 02/21/2006 72 67
-------------------------------------------------------------------------------------------------------
MORTGAGE ORIGINAL REMAINING MORTGAGE MONTHLY MONTHLY
LOAN NO. AMORT. TERM AMORT. TERM RATE PAYMENT (P&I) PAYMENT (IO) SEASONING
-------------------------------------------------------------------------------------------------------
360 360 6.211% $112,222 $94,464 7
IO IO 6.107% NAP $83,386 5
-----------------------------------------------------------------------------------------------------------------------------------
PREPAYMENT CODE
MORTGAGE -------------------------------------------------- ADMINISTRATIVE TRUSTEE EXCESS MORTGAGE
LOAN NO. LO DEF DEF/YM1.00 YM1.00 YM OPEN COST RATE FEE RATE SERVICING FEE RATE LOAN NO.
-----------------------------------------------------------------------------------------------------------------------------------
31 86 3 3.088
29 39 4 2.088
1-4
EXHIBIT 2
REPRESENTATIONS AND WARRANTIES REGARDING
INDIVIDUAL MORTGAGE LOANS
1. Mortgage Loan Schedule. The information set forth in the Mortgage Loan
Schedule is true and correct in all material respects as of the Cut-Off Date.
2. Whole Loan; Ownership of Mortgage Loans. Each Mortgage Loan is a whole loan
and not a participation interest in a mortgage loan. Immediately prior to the
transfer to Purchaser of the Mortgage Loans, Seller had good title to, and was
the sole owner of, each Mortgage Loan. Seller has full right, power and
authority to transfer and assign each of the Mortgage Loans to or at the
direction of Purchaser and has validly and effectively conveyed (or caused to be
conveyed) to Purchaser or its designee all of Seller's legal and beneficial
interest in and to the Mortgage Loans free and clear of any and all pledges,
liens, charges, security interests and/or other encumbrances. Upon the
consummation of the transactions contemplated by this Agreement, Seller will
have validly and effectively conveyed to Purchaser all legal and beneficial
interest in and to each Mortgage Loan free and clear of any pledge, lien,
charge, security interest or other encumbrance. The sale of the Mortgage Loans
to Purchaser or its designee does not require Seller to obtain any governmental
or regulatory approval or consent that has not been obtained.
3. Payment Record. No scheduled payment of principal and interest under any
Mortgage Loan was 30 days or more past due as of the Cut-Off Date, and no
Mortgage Loan was 30 days or more delinquent in the twelve-month period
immediately preceding the Cut-Off Date, in each case, without giving effect to
any applicable grace period.
4. Lien; Valid Assignment. The Mortgage related to and delivered in connection
with each Mortgage Loan constitutes a valid and, subject to the exceptions set
forth in paragraph 13 below, enforceable first priority lien upon the related
Mortgaged Property, prior to all other liens and encumbrances, except for (a)
the lien for current real estate taxes and assessments not yet due and payable,
(b) covenants, conditions and restrictions, rights of way, easements and other
matters that are of public record and/or are referred to in the Title Insurance
Policy, (c) exceptions and exclusions specifically referred to in such Title
Insurance Policy, (d) other matters to which like properties are commonly
subject, none of which matters referred to in clauses (b), (c) or (d),
individually or in the aggregate, materially interferes with the security
intended to be provided by such Mortgage, the marketability or current use of
the Mortgaged Property or the current ability of the Mortgaged Property to
generate operating income sufficient to service the Mortgage Loan debt and (e)
if such Mortgage Loan is cross-collateralized with any other Mortgage Loan, the
lien of the Mortgage for such other Mortgage Loan (the foregoing items (a)
through (e) being herein referred to as the "Permitted Encumbrances"). The
related assignment of such Mortgage executed and delivered in favor of Trustee
is in recordable form and constitutes a legal, valid and binding assignment,
sufficient to convey to the assignee named therein all of the assignor's right,
title and interest in, to and under such Mortgage. Such Mortgage, together with
any separate security agreements, chattel mortgages or equivalent instruments,
establishes and creates a valid and, subject to the exceptions set forth in
paragraph 13 below, enforceable security interest in favor of the holder thereof
in all of the related Mortgagor's personal property used in, and reasonably
necessary to operate, the related Mortgaged Property. In the case of a Mortgaged
Property operated as a hotel or an assisted
2-1
living facility, the Mortgagor's personal property includes all personal
property that a prudent mortgage lender making a similar Mortgage Loan would
deem reasonably necessary to operate the related Mortgaged Property as it is
currently being operated. A Uniform Commercial Code financing statement has been
filed and/or recorded in all places necessary to perfect a valid security
interest in such personal property, to the extent a security interest may be so
created therein, and such security interest is a first priority security
interest, subject to any prior purchase money security interest in such personal
property, any personal property leases applicable to such personal property and
any Permitted Encumbrances. Notwithstanding the foregoing, no representation is
made as to the perfection of any security interest in rents or other personal
property to the extent that possession or control of such items or actions other
than the filing of Uniform Commercial Code financing statements are required in
order to effect such perfection.
5. Assignment of Leases and Rents. The Assignment of Leases related to and
delivered in connection with each Mortgage Loan establishes and creates a valid,
subsisting and, subject to the exceptions set forth in paragraph 13 below and
any Permitted Encumbrances, enforceable first priority lien and first priority
security interest in the related Mortgagor's interest in all leases, sub-leases,
licenses or other agreements pursuant to which any person is entitled to occupy,
use or possess all or any portion of the real property subject to the related
Mortgage, and each assignor thereunder has the full right to assign the same.
The related assignment of any Assignment of Leases not included in a Mortgage
has been executed and delivered in favor of Trustee and is in recordable form
and constitutes a legal, valid and binding assignment, sufficient to convey to
the assignee named therein all of the assignor's right, title and interest in,
to and under such Assignment of Leases. If an Assignment of Leases exists with
respect to any Mortgage Loan (whether as a part of the related Mortgage or
separately), then the related Mortgage or related Assignment of Leases, subject
to applicable law, provides for, upon an event of default under the Mortgage
Loan, the appointment of a receiver for the collection of rents or for the
related mortgagee to enter into possession to collect the rents or for rents to
be paid directly to the mortgagee.
6. Mortgage Status; Waivers and Modifications. No Mortgage has been satisfied,
cancelled, rescinded or subordinated in whole or in part, and the related
Mortgaged Property has not been released from the lien of such Mortgage, in
whole or in part (except for partial reconveyances of real property that are set
forth on Schedule A to Exhibit 2), nor has any instrument been executed that
would effect any such satisfaction, cancellation, subordination, rescission or
release, in any manner that, in each case, materially adversely affects the
value of the related Mortgaged Property. None of the terms of any Mortgage Note,
Mortgage or Assignment of Leases has been impaired, waived, altered or modified
in any respect, except by written instruments, all of which are included in the
related Mortgage File and none of the Mortgage Loans has been materially
modified since July 31, 2006.
7. Condition of Property; Condemnation. Except with respect to Mortgage Loans
secured primarily by unimproved land: (i) With respect to the Mortgaged
Properties securing the Mortgage Loans that were the subject of an engineering
report within 18 months prior to the Cut-Off Date as set forth on Schedule A to
this Exhibit 2, each Mortgaged Property is, to Seller's knowledge, free and
clear of any damage (or adequate reserves therefor have been established based
on the engineering report) that would materially and adversely affect its value
as security for the related Mortgage Loan, and (ii) with respect to the
Mortgaged Properties securing the
2-2
Mortgage Loans that were not the subject of an engineering report within 18
months prior to the Cut-Off Date as set forth on Schedule A to this Exhibit 2,
each Mortgaged Property is in good repair and condition and all building systems
contained therein are in good working order (or adequate reserves therefor have
been established) and each Mortgaged Property is free of structural defects, in
each case, that would materially and adversely affect its value as security for
the related Mortgage Loan as of the date hereof. Seller has received no notice
of the commencement of any proceeding for the condemnation of all or any
material portion of any Mortgaged Property. To Seller's knowledge (based on
surveys and/or title insurance obtained in connection with the origination of
the Mortgage Loans), as of the date of the origination of each Mortgage Loan,
(x) all of the material improvements on the related Mortgaged Property that were
considered in determining the appraised value of the Mortgaged Property lay
wholly within the boundaries and building restriction lines of such property,
except for encroachments that are insured against by the Title Policy referred
to herein or that do not materially and adversely affect the value or
marketability of such Mortgaged Property, (y) no improvements on adjoining
properties materially encroached upon such Mortgaged Property so as to
materially and adversely affect the value or marketability of such Mortgaged
Property, except those encroachments that are insured against by the Title
Policy referred to herein, and (z) the Mortgaged Property securing each Mortgage
Loan is located on or adjacent to a public road, or has access to an easement
permitting ingress and egress.
8. Title Insurance. Each Mortgaged Property is covered by an American Land Title
Association (or an equivalent form of) lender's title insurance policy or a pro
forma or marked-up title insurance commitment (on which the required premium has
been paid) which evidences such title insurance policy (the "Title Policy") in
the original principal amount of the related Mortgage Loan after all advances of
principal. Each Title Policy insures that the related Mortgage is a valid first
priority lien on such Mortgaged Property, subject only to Permitted
Encumbrances. Each Title Policy (or, if it has yet to be issued, the coverage to
be provided thereby) is in full force and effect, all premiums thereon have been
paid and no material claims have been made thereunder and no claims have been
paid thereunder. No holder of the related Mortgage has done, by act or omission,
anything that would materially impair the coverage under such Title Policy.
Immediately following the transfer and assignment of the related Mortgage Loan
to Trustee, such Title Policy (or, if it has yet to be issued, the coverage to
be provided thereby) will inure to the benefit of Trustee without the consent
of, or notice to, the insurer. To Seller's knowledge, the insurer issuing such
Title Policy is qualified to do business in the jurisdiction in which the
related Mortgaged Property is located.
9. No Holdbacks. The proceeds of each Mortgage Loan have been fully disbursed
and there is no obligation for future advances with respect thereto. With
respect to each Mortgage Loan, any and all requirements as to completion of any
on-site or off-site improvement and as to disbursements of any funds escrowed
for such purpose that were to have been complied with on or before the Closing
Date have been complied with, or any such funds so escrowed have not been
released.
10. Mortgage Provisions. The Mortgage Note or Mortgage for each Mortgage Loan,
together with applicable state law, contains customary and enforceable
provisions (subject to the exceptions set forth in paragraph 13) such as to
render the rights and remedies of the holder
2-3
thereof adequate for the practical realization against the related Mortgaged
Property of the principal benefits of the security intended to be provided
thereby.
11. Trustee under Deed of Trust. If any Mortgage is a deed of trust, (1) a
trustee, duly qualified under applicable law to serve as such, is properly
designated and serving under such Mortgage, and (2) no fees or expenses are
payable to such trustee by Seller, Purchaser or any transferee thereof except in
connection with a trustee's sale after default by the related Mortgagor or in
connection with any full or partial release of the related Mortgaged Property or
related security for the related Mortgage Loan.
12. Environmental Conditions.
(i) Except as set forth on Schedule A to this Exhibit 2, with respect to
the Mortgaged Properties securing the Mortgage Loans that were the
subject of an environmental site assessment within 18 months prior to
the Cut-Off Date, an environmental site assessment prepared to ASTM
standards, or an update of a previous assessment, was performed with
respect to each Mortgaged Property in connection with the origination
or the sale of the related Mortgage Loan, a report of the most recent
assessment with respect to each Mortgaged Property (an "Environmental
Report") has been delivered to Purchaser, and Seller has no knowledge
of any material and adverse environmental condition or circumstance
affecting any Mortgaged Property that was not disclosed in such
Environmental Report. Each Mortgage requires the related Mortgagor to
comply with all applicable federal, state and local environmental laws
and regulations. Where such Environmental Report disclosed the
existence of a material and adverse environmental condition or
circumstance affecting any Mortgaged Property, (i) a party not related
to the Mortgagor was identified as the responsible party for such
condition or circumstance or (ii) environmental insurance covering
such condition was obtained or must be maintained until the condition
is remediated or (iii) the related Mortgagor was required either to
provide additional security that was deemed to be sufficient by the
originator in light of the circumstances and/or to establish an
operations and maintenance plan. In connection with the origination of
each Mortgage Loan, each environmental consultant has represented in
such Environmental Report or in a supplement letter that the
environmental assessment of the applicable Mortgaged Property was
conducted utilizing generally accepted Phase I industry standards
using the American Society for Testing and Materials (ASTM) standards.
Each Mortgage Loan set forth on Schedule C to this Exhibit 2 (each, a
"Schedule C Loan") is the subject of a Secured Creditor Impaired
Property Policy, issued by the issuer set forth on Schedule C (the
"Policy Issuer") and effective as of the date thereof (the
"Environmental Insurance Policy"). Except as set forth on Schedule A
to this Exhibit 2, with respect to each Schedule C Loan, (i) to
Seller's knowledge, the Environmental Insurance Policy is in full
force and effect, (ii)(a) a property condition or engineering report
was prepared with respect to lead based paint ("LBP") and radon gas
("RG") at each Mortgaged Property that is used as a multifamily
dwelling, and with respect to asbestos containing materials ("ACM") at
each related Mortgaged Property and (b) if such report disclosed the
existence of a material and adverse LBP, ACM or RG
2-4
environmental condition or circumstance affecting the related
Mortgaged Property, the related Mortgagor (A) was required to
remediate the identified condition prior to closing the Mortgage Loan
or provide additional security, or establish with the lender a reserve
from loan proceeds, in an amount deemed to be sufficient by Seller for
the remediation of the problem and/or (B) agreed in the Mortgage Loan
documents to establish an operations and maintenance plan after the
closing of the Mortgage Loan, (iii) on the effective date of the
Environmental Insurance Policy, Seller as originator had no knowledge
of any material and adverse environmental condition or circumstance
affecting the Mortgaged Property (other than the existence of LBP, ACM
or RG) that was not disclosed to the Policy Issuer in one or more of
the following: (a) the application for insurance, (b) a borrower
questionnaire that was provided to the Policy Issuer or (c) an
engineering or other report provided to the Policy Issuer and (iv) the
premium of any Environmental Insurance Policy has been paid through
the maturity of the policy's term and the term of such policy extends
at least five years beyond the maturity of the Mortgage Loan.
(ii) With respect to the Mortgaged Properties securing the Mortgage Loans
that were not the subject of an environmental site assessment prepared
to ASTM standards within 18 months prior to the Cut-Off Date as set
forth on Schedule A to this Exhibit 2, (i) no Hazardous Material is
present on such Mortgaged Property such that (1) the value, use or
operation of such Mortgaged Property is materially and adversely
affected or (2) under applicable federal, state or local law, (a) such
Hazardous Material could be required to be eliminated at a cost
materially and adversely affecting the value of the Mortgaged Property
before such Mortgaged Property could be altered, renovated, demolished
or transferred or (b) the presence of such Hazardous Material could
(upon action by the appropriate governmental authorities) subject the
owner of such Mortgaged Property, or the holders of a security
interest therein, to liability for the cost of eliminating such
Hazardous Material or the hazard created thereby at a cost materially
and adversely affecting the value of the Mortgaged Property, and (ii)
such Mortgaged Property is in material compliance with all applicable
federal, state and local laws pertaining to Hazardous Materials or
environmental hazards, any noncompliance with such laws does not have
a material adverse effect on the value of such Mortgaged Property and
neither Seller nor, to Seller's knowledge, the related Mortgagor or
any current tenant thereon, has received any notice of violation or
potential violation of any such law.
"Hazardous Materials" means gasoline, petroleum products, explosives,
radioactive materials, polychlorinated biphenyls or related or similar
materials, and any other substance or material as may be defined as a
hazardous or toxic substance by any federal, state or local
environmental law, ordinance, rule, regulation or order, including
without limitation, the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended (42 U.S.C. Sections
9601 et seq.), the Hazardous Materials Transportation Act as amended
(42 U.S.C. Sections 6901 et seq.), the Resource Conservation and
Recovery Act, as amended (42 U.S.C. Sections 6901 et seq.), the
Federal Water Pollution Control
2-5
Act as amended (33 U.S.C. Sections 1251 et seq.), the Clean Air Act
(42 U.S.C. Sections 1251 et seq.) and any regulations promulgated
pursuant thereto.
13. Loan Document Status. Each Mortgage Note, Mortgage, Assignment of Leases and
other agreement that evidences or secures such Mortgage Loan and was executed by
or on behalf of the related Mortgagor or any guarantor of any non-recourse
exceptions and environmental liability is the legal, valid and binding
obligation of the maker thereof (subject to any non-recourse provisions
contained in any of the foregoing agreements and any applicable state
anti-deficiency or market value limit deficiency legislation), enforceable in
accordance with its terms, except as such enforcement may be limited by
bankruptcy, insolvency, reorganization or other similar laws affecting the
enforcement of creditors' rights generally, and by general principles of equity
(regardless of whether such enforcement is considered in a proceeding in equity
or at law) and there is no valid defense, counterclaim or right of offset or
rescission available to the related Mortgagor with respect to such Mortgage
Note, Mortgage or other agreement.
14. Insurance. Each Mortgaged Property is, and is required pursuant to the
related Mortgage to be, insured by (a) a fire and extended perils insurance
policy providing coverage against loss or damage sustained by reason of fire,
lightning, windstorm, hail, explosion, riot, riot attending a strike, civil
commotion, aircraft, vehicles and smoke, and, to the extent required as of the
date of origination by the originator of such Mortgage Loan consistent with its
capital markets conduit lending practices, against other risks insured against
by persons operating like properties in the locality of the Mortgaged Property
in an amount not less than the lesser of the principal balance of the related
Mortgage Loan and the replacement cost of the improvements located at the
Mortgaged Property, and not less than the amount necessary to avoid the
operation of any co-insurance provisions with respect to the Mortgaged Property,
and the policy contains no provisions for a deduction for depreciation; (b) a
business interruption or rental loss insurance policy, in an amount at least
equal to twelve months of operations of the Mortgaged Property estimated as of
the date of origination by the originator of such Mortgage Loan consistent with
its capital markets conduit lending practices; (c) a flood insurance policy (if
any portion of buildings or other structures on the Mortgaged Property are
located in an area identified by the Federal Emergency Management Agency as
having special flood hazards and the Federal Emergency Management Agency
requires flood insurance to be maintained); and (d) a comprehensive general
liability insurance policy in amounts as are generally required by commercial
mortgage lenders for properties of similar types and in any event not less than
$1 million per occurrence. Each insurance policy contains a standard mortgagee
clause that names the mortgagee as an additional insured in the case of
liability insurance policies and as a loss payee in the case of property
insurance policies and requires prior notice to the holder of the Mortgage of
termination, reduction of coverage or cancellation. No such notice has been
received, including any notice of nonpayment of premiums, that has not been
cured. Each Mortgage obligates the related Mortgagor to maintain all such
insurance and, upon such Mortgagor's failure to do so, authorizes the holder of
the Mortgage to maintain such insurance at the Mortgagor's cost and expense and
to seek reimbursement therefor from such Mortgagor. Each Mortgage provides that
casualty insurance proceeds will (or at the lender's option will) be applied (a)
to the restoration or repair of the related Mortgaged Property, (b) to the
restoration or repair of the related Mortgaged Property, with any excess
insurance proceeds after restoration or repair being paid to the Mortgagor, or
(c) to the reduction of the principal amount of the Mortgage Loan. For each
Mortgaged Property located in a Zone 3 or Zone 4 seismic zone,
2-6
either: (i) a seismic report which indicated a PML of less than 20% was
prepared, based on a 450 or 475-year average return period with a 10%
probability of exceedance in a 50-year period, in connection with the
origination of the Mortgage Loan secured by such Mortgaged Property or (ii) the
improvements for the Mortgaged Property are insured against earthquake damage.
15. Taxes and Assessments. As of the Closing Date, there are no delinquent or
unpaid taxes, assessments (including assessments payable in future installments)
or other outstanding charges affecting any Mortgaged Property that are or may
become a lien of priority equal to or higher than the lien of the related
Mortgage. For purposes of this representation and warranty, real property taxes
and assessments shall not be considered delinquent or unpaid until the date on
which interest or penalties would be first payable thereon.
16. Mortgagor Bankruptcy. No Mortgagor is, to Seller's knowledge, a debtor in
any state or federal bankruptcy or insolvency proceeding.
17. Leasehold Estate. Each Mortgaged Property consists of a fee simple estate in
real estate or, if the related Mortgage Loan is secured in whole or in part by
the interest of a Mortgagor as a lessee under a ground lease of a Mortgaged
Property (a "Ground Lease" which term shall include any related estoppel letter
or lender protection agreement between Seller and related lessor), by the
related Mortgagor's interest in the Ground Lease but not by the related fee
interest in such Mortgaged Property (the "Fee Interest"), and as to such Ground
Leases:
(i) Such Ground Lease or a memorandum thereof has been or will be duly
recorded; such Ground Lease (or the related estoppel letter or
lender protection agreement between Seller and related lessor) does
not prohibit the current use of the Mortgaged Property and does not
prohibit the interest of the lessee thereunder to be encumbered by
the related Mortgage; and there has been no material change in the
payment terms of such Ground Lease since the origination of the
related Mortgage Loan, with the exception of material changes
reflected in written instruments that are a part of the related
Mortgage File;
(ii) The lessee's interest in such Ground Lease is not subject to any
liens or encumbrances superior to, or of equal priority with, the
related Mortgage, other than Permitted Encumbrances;
(iii) The Mortgagor's interest in such Ground Lease is assignable to
Purchaser and Trustee as its assignee upon notice to, but without
the consent of, the lessor thereunder (or, if such consent is
required for assignment to Purchaser, it has been obtained prior to
the Closing Date) and is further assignable by Purchaser and its
successors and assigns upon notice to, but without the need to
obtain the consent of, such lessor or if such lessor's consent is
required it either has been obtained or it cannot be unreasonably
withheld;
(iv) Such Ground Lease is in full force and effect, the Ground Lease
provides that no material amendment to such Ground Lease is binding
on a mortgagee unless the mortgagee has consented thereto, Seller
has received no notice that an event of default has occurred
thereunder, and, to Seller's knowledge, there exists no
2-7
condition that, but for the passage of time or the giving of notice,
or both, would result in an event of default under the terms of such
Ground Lease;
(v) Such Ground Lease (A) requires the lessor under such Ground Lease to
give notice of any default by the lessee to the holder of the
Mortgage; and (B) provides that no notice of termination given under
such Ground Lease is effective against the holder of the Mortgage
unless a copy of such notice has been delivered to such holder and
the lessor has offered or is required to enter into a new lease with
such holder on terms that do not materially vary from the economic
terms of the Ground Lease.
(vi) A mortgagee is permitted a reasonable opportunity (including, where
necessary, sufficient time to gain possession of the interest of the
lessee under such Ground Lease) to cure any default under such
Ground Lease, which is curable after the receipt of notice of any
such default, before the lessor thereunder may terminate such Ground
Lease;
(vii) Such Ground Lease has an original term (including any extension
options set forth therein) which extends not less than twenty years
beyond the Maturity Date of the related Mortgage Loan;
(viii) Under the terms of such Ground Lease and the related Mortgage, taken
together, any related insurance proceeds or condemnation award
awarded to the holder of the ground lease interest will be applied
either (A) to the repair or restoration of all or part of the
related Mortgaged Property, with the mortgagee or a trustee
appointed by the related Mortgage having the right to hold and
disburse such proceeds as the repair or restoration progresses
(except in such cases where a provision entitling a third party to
hold and disburse such proceeds would not be viewed as commercially
unreasonable by a prudent commercial mortgage lender), or (B) to the
payment of the outstanding principal balance of the Mortgage Loan
together with any accrued interest thereon; and
(ix) Such Ground Lease does not impose any restrictions on subletting
which would be viewed as commercially unreasonable by prudent
commercial mortgage lenders lending on a similar Mortgaged Property
in the lending area where the Mortgaged Property is located; and
such Ground Lease contains a covenant that the lessor thereunder is
not permitted, in the absence of an uncured default, to disturb the
possession, interest or quiet enjoyment of the lessee thereunder for
any reason, or in any manner, which would materially adversely
affect the security provided by the related Mortgage.
(x) Such Ground Lease requires the Lessor to enter into a new lease upon
termination of such Ground Lease if the Ground Lease is rejected in
a bankruptcy proceeding.
18. Escrow Deposits. All escrow deposits and payments relating to each Mortgage
Loan that are, as of the Closing Date, required to be deposited or paid have
been so deposited or paid.
2-8
19. LTV Ratio. The gross proceeds of each Mortgage Loan to the related Mortgagor
at origination did not exceed the non-contingent principal amount of the
Mortgage Loan and either: (a) such Mortgage Loan is secured by an interest in
real property having a fair market value (i) at the date the Mortgage Loan was
originated, at least equal to 80 percent of the original principal balance of
the Mortgage Loan or (ii) at the Closing Date, at least equal to 80 percent of
the principal balance of the Mortgage Loan on such date; provided that for
purposes hereof, the fair market value of the real property interest must first
be reduced by (x) the amount of any lien on the real property interest that is
senior to the Mortgage Loan and (y) a proportionate amount of any lien that is
in parity with the Mortgage Loan (unless such other lien secures a Mortgage Loan
that is cross-collateralized with such Mortgage Loan, in which event the
computation described in clauses (a)(i) and (a)(ii) of this paragraph 19 shall
be made on a pro rata basis in accordance with the fair market values of the
Mortgaged Properties securing such cross-collateralized Mortgage Loans); or (b)
substantially all the proceeds of such Mortgage Loan were used to acquire,
improve or protect the real property that served as the only security for such
Mortgage Loan (other than a recourse feature or other third party credit
enhancement within the meaning of Treasury Regulations Section
1.860G-2(a)(1)(ii)).
20. Mortgage Loan Modifications. Any Mortgage Loan that was "significantly
modified" prior to the Closing Date so as to result in a taxable exchange under
Section 1001 of the Code either (a) was modified as a result of the default
under such Mortgage Loan or under circumstances that made a default reasonably
foreseeable or (b) satisfies the provisions of either clause (a)(i) of paragraph
19 (substituting the date of the last such modification for the date the
Mortgage Loan was originated) or clause (a)(ii) of paragraph 19, including the
proviso thereto.
21. Advancement of Funds by Seller. No holder of a Mortgage Loan has advanced
funds or induced, solicited or knowingly received any advance of funds from a
party other than the owner of the related Mortgaged Property, directly or
indirectly, for the payment of any amount required by such Mortgage Loan.
22. No Mechanics' Liens. Each Mortgaged Property is free and clear of any and
all mechanics' and materialmen's liens that are prior or equal to the lien of
the related Mortgage, except, in each case, for liens insured against by the
Title Policy referred to herein, and no rights are outstanding that under law
could give rise to any such lien that would be prior or equal to the lien of the
related Mortgage except, in each case, for liens insured against by the Title
Policy referred to herein.
23. Compliance with Usury Laws. Each Mortgage Loan complied with (or is exempt
from) all applicable usury laws and any other applicable material laws in effect
at its date of origination.
24. Cross-collateralization. No Mortgage Loan is cross-collateralized or
cross-defaulted with any loan other than one or more other Mortgage Loans.
25. Releases of Mortgaged Property. Except as described in the next sentence, no
Mortgage Note or Mortgage requires the mortgagee to release all or any material
portion of the related Mortgaged Property that was included in the appraisal for
such Mortgaged Property, and/or generates income from the lien of the related
Mortgage except upon payment in full of all
2-9
amounts due under the related Mortgage Loan or in connection with the defeasance
provisions of the related Note and Mortgage. The Mortgages relating to those
Mortgage Loans identified on Schedule A hereto require the mortgagee to grant
releases of portions of the related Mortgaged Properties upon (a) the
satisfaction of certain legal and underwriting requirements and/or (b) the
payment of a predetermined or objectively determinable release price and
prepayment consideration in connection therewith. Except as described in the
first sentence hereof and for those Mortgage Loans identified on Schedule A, no
Mortgage Loan permits the full or partial release or substitution of collateral
unless the mortgagee or servicer can require the Borrower to provide an opinion
of tax counsel to the effect that such release or substitution of collateral (a)
would not constitute a "significant modification" of such Mortgage Loan within
the meaning of Treas. Reg. Sections 1.1001-3 and (b) would not cause such
Mortgage Loan to fail to be a "qualified mortgage" within the meaning of Section
860G(a)(3)(A) of the Code. The loan documents require the related Mortgagor to
bear the reasonable cost of such opinion.
26. No Equity Participation or Contingent Interest. No Mortgage Loan contains
any equity participation by the lender or shared appreciation feature or
provides for negative amortization (except that the ARD Loan may provide for the
accrual of interest at an increased rate after the Anticipated Repayment Date)
or for any contingent or additional interest in the form of participation in the
cash flow of the related Mortgaged Property. Neither Seller nor any affiliate
thereof has any obligation to make a capital contribution to the Mortgagor under
the Mortgage Loan or otherwise.
27. No Material Default. To Seller's knowledge, there exists no material
default, breach, violation or event of acceleration (and no event which, with
the passage of time or the giving of notice, or both, would constitute any of
the foregoing) under the documents evidencing or securing the Mortgage Loan, in
any such case to the extent the same materially and adversely affects the value
of the Mortgage Loan and the related Mortgaged Property; provided, however, that
this representation and warranty does not address or otherwise cover any
default, breach, violation or event of acceleration that specifically pertains
to any matter otherwise covered by any other representation and warranty made by
Seller elsewhere in this Exhibit 2 or the exceptions listed in Schedule A
attached hereto.
28. Inspections. Seller (or if Seller is not the originator, the originator of
the Mortgage Loan) has inspected or caused to be inspected each Mortgaged
Property in connection with the origination of the related Mortgage Loan.
29. Local Law Compliance. Based on due diligence considered reasonable by
prudent commercial mortgage lenders in the lending area where the Mortgaged
Property is located, the improvements located on or forming part of each
Mortgaged Property comply with applicable zoning laws and ordinances, or
constitute a legal non-conforming use or structure or, if any such improvement
does not so comply, such non-compliance does not materially and adversely affect
the value of the related Mortgaged Property, such value as determined by the
appraisal performed at origination or in connection with the sale of the related
Mortgage Loan by Seller hereunder.
30. Junior Liens. None of the Mortgage Loans permits the related Mortgaged
Property to be encumbered by any lien (other than a Permitted Encumbrance)
junior to or of equal priority with
2-10
the lien of the related Mortgage without the prior written consent of the holder
thereof or the satisfaction of debt service coverage or similar criteria
specified therein. Seller has no knowledge that any of the Mortgaged Properties
is encumbered by any lien (other than a Permitted Encumbrance) junior to the
lien of the related Mortgage.
31. Actions Concerning Mortgage Loans. To the knowledge of Seller, there are no
actions, suits or proceedings before any court, administrative agency or
arbitrator concerning any Mortgage Loan, Mortgagor or related Mortgaged Property
that might adversely affect title to the Mortgaged Property or the validity or
enforceability of the related Mortgage or that might materially and adversely
affect the value of the Mortgaged Property as security for the Mortgage Loan or
the use for which the premises were intended.
32. Servicing. The servicing and collection practices used by Seller or any
prior holder or servicer of each Mortgage Loan have been in all material
respects legal, proper and prudent and have met customary industry standards.
33. Licenses and Permits. To Seller's knowledge, based on due diligence that it
customarily performs in the origination of comparable mortgage loans, as of the
date of origination of each Mortgage Loan or as of the date of the sale of the
related Mortgage Loan by Seller hereunder, the related Mortgagor was in
possession of all material licenses, permits and franchises required by
applicable law for the ownership and operation of the related Mortgaged Property
as it was then operated.
34. RESERVED [ONLY APPLICABLE IF ANY MORTGAGE LOAN IS AN ASSISTED LIVING
FACILITY].
35. Collateral in Trust. The Mortgage Note for each Mortgage Loan is not secured
by a pledge of any collateral that has not been assigned to Purchaser.
36. Due on Sale. Each Mortgage Loan contains a "due on sale" clause, which
provides for the acceleration of the payment of the unpaid principal balance of
the Mortgage Loan if, without prior written consent of the holder of the
Mortgage, the property subject to the Mortgage or any material portion thereof,
or a controlling interest in the related Mortgagor, is transferred, sold or
encumbered by a junior mortgage or deed of trust; provided, however, that
certain Mortgage Loans provide a mechanism for the assumption of the loan by a
third party upon the Mortgagor's satisfaction of certain conditions precedent,
and upon payment of a transfer fee, if any, or transfer of interests in the
Mortgagor or constituent entities of the Mortgagor to a third party or parties
related to the Mortgagor upon the Mortgagor's satisfaction of certain conditions
precedent.
37. Single Purpose Entity. The Mortgagor on each Mortgage Loan with a Cut-Off
Date Principal Balance in excess of $10 million, was, as of the origination of
the Mortgage Loan, a Single Purpose Entity. For this purpose, a "Single Purpose
Entity" shall mean an entity, other than an individual, whose organizational
documents provide substantially to the effect that it was formed or organized
solely for the purpose of owning and operating one or more of the Mortgaged
Properties securing the Mortgage Loans and prohibit it from engaging in any
business unrelated to such Mortgaged Property or Properties, and whose
organizational
2-11
documents further provide, or which entity represented in the related Mortgage
Loan documents, substantially to the effect that it does not have any assets
other than those related to its interest in and operation of such Mortgaged
Property or Properties, or any indebtedness other than as permitted by the
related Mortgage(s) or the other related Mortgage Loan documents, that it has
its own books and records and accounts separate and apart from any other person
(other than a Mortgagor for a Mortgage Loan that is cross-collateralized and
cross-defaulted with the related Mortgage Loan), and that it holds itself out as
a legal entity, separate and apart from any other person.
38. Non-Recourse Exceptions. The Mortgage Loan documents for each Mortgage Loan
provide that such Mortgage Loan constitutes either (a) the recourse obligations
of at least one natural person or (b) the non-recourse obligations of the
related Mortgagor, provided that at least one natural person (and the Mortgagor
if the Mortgagor is not a natural person) is liable to the holder of the
Mortgage Loan for damages arising in the case of fraud or willful
misrepresentation by the Mortgagor, misappropriation of rents, insurance
proceeds, condemnation awards and breaches of the environmental covenants in the
Mortgage Loan documents.
39. Defeasance and Assumption Costs. The related Mortgage Loan documents provide
that the related borrower is responsible for the payment of all reasonable costs
and expenses of the lender incurred in connection with the defeasance of such
Mortgage Loan and the release of the related Mortgaged Property, and the
borrower is required to pay all reasonable costs and expenses of the lender
associated with the approval of an assumption of such Mortgage Loan.
40. Defeasance. No Mortgage Loan provides that (i) it can be defeased until the
date that is at least two years after the Closing Date, (ii) that it can be
defeased with any property other than government securities (as defined in
Section 2(a)(16) of the Investment Company Act of 1940, as amended) or any
direct non-callable security issued or guaranteed as to principal or interest by
the United States that will provide interest and principal payments sufficient
to satisfy scheduled payments of interest and principal as required under the
related Mortgage Loan, or (iii) defeasance requires the payment of any
consideration other than (a) reimbursement of incidental costs and expenses
and/or (b) a specified dollar amount or an amount that is based on a formula
that uses objective financial information (as defined in Treasury Regulation
Section 1.446-3(c)(4)(ii)).
41. Authorized to do Business. To the extent required under applicable law as of
the date of origination, and necessary for the enforceability or collectability
of the Mortgage Loan, 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 originated and held the Mortgage Loan.
42. Prepayment Premiums. As of the applicable date of origination of each such
Mortgage Loan, any prepayment premiums and yield maintenance charges payable
under the terms of the Mortgage Loans, in respect of voluntary prepayments,
constituted "customary prepayment penalties" within the meaning of Treasury
Regulation Section 1.860G-1(b)(2).
43. Terrorism Insurance. With respect to each Mortgage Loan that has a principal
balance as of the Cut-off Date that is greater than or equal to $17,500,000, the
related all risk insurance
2-12
policy and business interruption policy do not specifically exclude Acts of
Terrorism, as defined in the Terrorism Risk Insurance Act of 2002, from
coverage, or if such coverage is excluded, is covered by a separate terrorism
insurance policy. With respect to each other Mortgage Loan, the related all risk
insurance policy and business interruption policy did not as of the date of
origination of the Mortgage Loan, and, to Seller's knowledge, do not, as of the
date hereof, specifically exclude Acts of Terrorism from coverage, or if such
coverage is excluded, it is covered by a separate terrorism insurance policy.
With respect to each of the Mortgage Loans, the related Mortgage Loan documents
do not waive or prohibit the mortgagee from requiring coverage for acts of
terrorism or damages related thereto, except to the extent that any right to
require such coverage may be limited by commercially reasonable availability, or
as otherwise indicated on Schedule A.
44. Operating Statements and Rent Rolls. In the case of each Mortgage Loan, the
related Mortgage Loan documents require the related Mortgagor, in some cases at
the request of the lender, to provide to the holder of such Mortgage Loan
operating statements and rent rolls not less frequently than annually (except in
certain cases if the Mortgage Loan has an outstanding principal balance of less
than or equal to $3,500,000 as of the Cut-off Date or the related Mortgaged
Property has only one tenant, in either of which cases, the Mortgage Loan
documents require the Mortgagor, in some cases at the request of the lender, to
provide to the holder of such Mortgage Loan operating statements and (if there
is more than one tenant) rent rolls and/or financial statements of the Mortgagor
annually), and such other information as may be required therein.
45. Qualified Mortgage. Each Mortgage Loan is a "qualified mortgage" within the
meaning of Section 860G(a)(3) of the Code and Treasury Regulation Section
1.860G-2(a) (but without regard to the rule in Treasury Regulation Sections
1.860G-2(a)(3) and 1.860G-2(f)(2) that treat a defective obligation as a
qualified mortgage, or any substantially similar provision).
46. No Fraud in Origination. A court of competent jurisdiction will not find, in
a final non-appealable judgment, that an employee of Seller actively
participated with the Borrower in any intentional fraud in connection with the
origination of the Mortgage Loan. To Seller's knowledge, no Borrower is guilty
of defrauding or making an intentional material misrepresentation to Seller in
connection with the origination of the Mortgage Loan.
47. An appraisal of the related Mortgaged Property was conducted in connection
with the origination of such Mortgage Loan, and such appraisal satisfied the
guidelines in Title XI of the Financial Institutions Reform, Recovery and
Enforcement Act of 1989, as in effect on the date such Mortgage Loan was
originated.
48. Foreclosure Property. Seller is not selling any Mortgage Loan as part of a
plan to transfer the underlying Mortgaged Property to Purchaser, and Seller does
not know or, to Seller's knowledge, have reason to know that any Mortgage Loan
will default. The representations in this paragraph 48 are made solely for the
purpose of determining whether the Mortgaged Property, if acquired by the Trust,
would qualify as "foreclosure property" within the meaning of Section 860G(a)(8)
of the Code, and may not be relied upon or used for any other purpose. Such
representations shall not be construed as a guarantee to any degree that
defaults or losses will not occur.
2-13
49. Tax Parcels. Each Mortgaged Property constitutes one or more complete
separate tax lots containing no other property, or is subject to an endorsement
under the related Title Policy insuring same, or an application for the creation
of separate tax lots complying in all respects with the applicable laws and
requirements of the applicable governing authority has been made and approved by
the applicable governing authority and such tax lots shall be effective for the
next tax year.
2-14
Schedule A to Exhibit 2
Exceptions to Representations and Warranties
SCHEDULE A
EXCEPTIONS TO REPRESENTATIONS AND WARRANTIES*
EXCEPTIONS TO REPRESENTATION (4)
LOANS EXCEPTIONS
--------------------------------- --------------------------------------------
0000 XXXXXX XXXXXX BUILDING The Mortgage Loan is structured as an
indemnity deed of trust ("IDOT"), under
which the guarantor of the Mortgage Note
related to the IDOT owns the related
Mortgaged Property and thus has an interest
in the lease payments.
EXCEPTIONS TO REPRESENTATION (13)
LOANS EXCEPTIONS
--------------------------------- --------------------------------------------
0000 XXXXXX XXXXXX XXXXXXXX Xxxxxxxx Loan is structured as an IDOT, and
while the related Mortgagor was the maker of
the Mortgage Note, the Mortgage was given by
the IDOT grantor.
EXCEPTIONS TO REPRESENTATION (14)
LOANS EXCEPTIONS
--------------------------------- --------------------------------------------
225 FRANKLIN The Mortgagor may self-insure the coverages
required by the Mortgage Loan documents
using any entity which is an affiliate of
the guarantor and has an A.M. Best rating of
at least "A-/VII" so long as guarantor
maintains a credit rating of at least "BBB-"
by S&P.
WALGREENS PHOENIX Walgreens Co. currently self-insures the
Mortgaged Property.
----------
* Seller has attempted to indicate the particular representation or warranty
(by reference to the Section in which such representation or warranty
appears) to which an exception primarily relates. Notwithstanding the
foregoing, each exception is intended to qualify each representation or
warranty to which it may relate, regardless whether such exception
expressly refers to the Section in which the applicable representation or
warranty appears.
For purposes of the MLPA and Exhibit 2 - Representations and Warranties of
Seller, Seller deems the term "commercial and multifamily" to include
manufactured housing communities.
In addition, all mortgage loan assignments and UCC financing statements
assignments were executed in favor of the Trustee and not the Purchaser.
RITE AID-XXXXXXX HARCO, Inc. currently self-insures the
Mortgaged Property.
EXCEPTIONS TO REPRESENTATION (18)
LOANS DESCRIPTION OF EXCEPTIONS
--------------------------------- --------------------------------------------
000 00XX XXXXXX The Mortgaged Property is made up of fee and
leasehold interests. In total, there are
four Ground Leases and one sub-Ground Lease.
A portion of the building (lots 9 and 10,
which lie under approximately 10% of the
building) on the Mortgaged Property is
subject to two Ground Leases both of which
cover the same area and have the same ground
landlord, the original ground lease dated as
of August 30, 1924 (the "1924 Ground Lease")
and a subsequent ground lease dated as of
February 1, 1970 (as amended from time to
time, the "Lakeside Ground Lease"). In
addition, there is a ground sublease of the
1924 Ground Lease dated as of August 14,
1961 (as amended from time to time, the
"1730 California Ground Sublease"). The
parking garage is subject to two ground
leases, the Quait/Xxxxxxx Ground Lease (on
lots 3-8) dated as of March 29, 1974 (as
amended from time to time, the
"Quait/Xxxxxxx Ground Lease") and the Xxxxxx
Ground Lease (on lots 1 and 2 and 9-16)
dated as of March 29, 1974 (as amended from
time to time, the "Xxxxxx Ground Lease"). To
note, simultaneously with the closing of the
Mortgage Loan, Mortgagor acquired the
Mortgaged Property from the seller of the
Mortgaged Property (the "633 Property
Seller").
(i) The ground landlord estoppel
certificates for the Xxxxxx Ground Lease are
silent on whether there has been a material
change in the terms of the Xxxxxx Ground
Lease. However, the estoppel certificate
executed and delivered by 633 Property
Seller in connection with the Xxxxxx Ground
Lease state that the Xxxxxx Ground Lease has
not been amended, modified, supplemented or
superseded.
(iii) Each of the 1924 Ground Lease and the
1730 California Ground Sublease is silent on
the transfer of Mortgagor's interest upon a
foreclosure or deed in lieu of foreclosure.
(iv) The estoppel certificate for each of
the 1730 California Ground Sublease and the
Xxxxxx Ground Lease did not address whether
the respective Ground Lease is in full force
and effect. The estoppel certificate for the
1730 California Ground Sublease did not
address whether any default has occurred
under the Ground Lease. No assurances were
received in the form of an estoppel
certificate in connection with the 1924
Ground Lease, therefore, Seller cannot
confirm whether the 1924 Ground Lease is in
full force and effect and whether any
default has occurred under such Ground
Lease. However, Mortgagor represented in the
Mortgage Loan documents that each Ground
Lease is in full force and effect and that
no default has occurred under the respective
Ground Leases and the sub-Ground Lease.
Additionally, the estoppel certificates
executed and delivered by 633 Property
Seller in connection with the Xxxxxx Ground
Lease state that the Xxxxxx Ground Lease is
in full force and effect.
Each of the 1924 Ground Lease, the 1730
California Ground Sublease, the Lakeside
Ground Lease, the Quait/Xxxxxxx Ground Lease
and the Xxxxxx Ground Lease is silent on
whether mortgagee consent is required in
connection with an amendment, modification,
cancellation or termination of the
respective Ground Lease and whether any
amendment, termination, modification or
cancellation of the respective Ground Lease
without mortgagee's consent is binding on
such mortgagee. However, the Mortgage Loan
documents require Mortgagor to obtain
mortgagee's consent to any amendment,
termination, modification or cancellation of
any Ground Lease and the principal under the
Mortgage Loan executed a non-recourse
carveout guaranty, which included a carveout
for any losses suffered by mortgagee as a
result of a termination or rejection of the
Ground Lease.
(v) The 1924 Ground Lease is silent on
whether the ground landlord has to give
notice of any default by the ground tenant
to mortgagee. Each of the 1924 Ground Lease,
the 1730 California Ground Sublease, the
Quait/Xxxxxxx Ground Lease, the Lakeside
Ground Lease and the Xxxxxx Ground Lease are
silent on whether a notice of default and/or
a notice of termination given under the
respective Ground Lease is effective against
a mortgagee unless a copy has been delivered
to such mortgagee in the manner described in
such Ground Lease. However, under the
Quait/Xxxxxxx Ground Lease, the Xxxxxx
Ground Lease and the Lakeside Ground Lease,
the respective ground landlord cannot
terminate the respective Ground Lease unless
prior notice of a default has been given to
a mortgagee and mortgagee fails to cure such
default and under the 1730 California Ground
Sublease, the ground landlord may not
terminate the Ground Sublease if mortgagee
cures a default within 30 days after receipt
of a default notice. Additionally, Mortgagor
has covenanted under the Mortgage Loan
documents to provide copies of all notices
to Mortgagee.
(vi) Each of the 1924 Ground Lease and the
1730 California Ground Sublease is silent on
whether mortgagee under the Mortgage Loan is
permitted a reasonable opportunity to cure
any default under the respective Ground
Lease. However, under the 1730 California
Ground Sublease, the ground landlord may not
terminate the Ground Lease if mortgagee
cures a default within 30 days after receipt
of default notice. The Lakeside Ground Lease
(which covers the same real property as the
1924 Ground Lease) operates to address the
continuation of Mortgagor's leasehold estate
if the 1924 Ground Lease were to be
terminated and the term of the Lakeside
Ground Lease runs 49 years beyond the
maturity date of the Mortgage Loan.
(vii) The term of each of the 1924 Ground
Lease and the 1730 California Ground
Sublease (including all respective renewal
terms) expires seven years after the
Maturity Date of the Mortgage Loan. However,
the Lakeside Ground Lease (which covers the
same real property as the 1924 Ground Lease)
operates to address the continuation of
Mortgagor's leasehold estate after the
expiration of the 1924 Ground Lease and the
1730 California Ground Sublease and the term
of the Lakeside Ground Lease runs 49 years
beyond the maturity date of the Mortgage
Loan.
(x) Each of the 1924 Ground Lease, the 1730
California Ground Sublease and the Lakeside
Ground Lease is silent on whether, after a
bankruptcy or following the termination of
either Ground Lease, mortgagee may enter
into a new ground lease with the ground
landlord. However, the principal under the
Mortgage Loan executed a non-recourse
carveout guaranty, which included a carveout
for any losses suffered by mortgagee as a
result of a termination or rejection of any
Ground Lease.
EXCEPTIONS TO REPRESENTATION (24)
LOANS EXCEPTIONS
--------------------------------- --------------------------------------------
DCT INDUSTRIAL PORTFOLIO The Mortgaged Property secures an A note
(which is included in the HQ9 trust fund), a
B note (which is subordinate to the A note
and is not included in the HQ9 trust fund)
and a C note (which is subordinate to the A
note and the B note and is included in the
HQ9 trust fund).
GIANT FOOD - BUCKS COUNTY The Mortgaged Property secures the Mortgage
Loan and a B note in the amount of
$1,743,053.10 (which is not included in the
HQ9 trust fund).
EXCEPTIONS TO REPRESENTATION (25)
LOANS EXCEPTIONS
--------------------------------- --------------------------------------------
DCT INDUSTRIAL PORTFOLIO The Mortgage Loan documents permit the
substitution of up to two of the Mortgaged
Properties in any one year subject to
satisfying certain conditions.
SUNSET APARTMENTS AND COMMANDER The Mortgage Loan documents permit the
APARTMENTS release of one of the two parcels which
comprise the Mortgaged Property subject to
satisfying certain conditions and prepayment
of 125% of the allocated loan amount.
EXCEPTIONS TO REPRESENTATION (29)
LOANS EXCEPTIONS
----- ----------
XXXXXX-XXXXXX The Mortgaged Property is nonconforming due
to insufficient parking. A non-recourse
carveout was added to cover any loss to the
mortgagee resulting from failure to comply
with the zoning laws.
EXCEPTIONS TO REPRESENTATION (31)
LOANS EXCEPTIONS
----- ----------
MAYO MEDICAL BUILDING There is a pending SEC Investigation against
000 00XX XXXXXX the principal of Mortgagor. The
investigation does not include the Mortgaged
Property. A guaranty was executed for the
Mortgage Loan by such principal to indemnify
the holder of the Mortgage Loan from any
losses resulting from such investigation.
EXCEPTIONS TO REPRESENTATION (33)
LOANS EXCEPTIONS
----- ----------
CENTRAL SELF STORAGE The Mortgaged Property has been issued a
temporary Certificate of Occupancy, due to
ongoing work on the adjacent property which
the local government desires to review at
the same time as the Mortgaged Property. The
local governmental authority has represented
that it expects to issue the permanent
Certificate of Occupancy within 60 days of
origination. The Mortgagor signed a Special
Guaranty making the Mortgage Loan recourse
if the Mortgagor is unable or unwilling to
obtain a permanent Certificate of Occupancy
for the Mortgaged Property.
EASTSIDE SELF STORAGE The Mortgaged Property has been issued a
temporary Certificate of Occupancy, due to
incomplete landscaping. Within 120 days
after origination, the Mortgagor is required
to deliver evidence that the required
landscaping has been completed. Immediately
upon completion, the Mortgagor shall
diligently pursue the issuance of a
permanent Certificate of Occupancy.
EXCEPTIONS TO REPRESENTATION (36)
LOANS EXCEPTIONS
----- ----------
225 FRANKLIN Future mezzanine debt is permitted in
DCT INDUSTRIAL PORTFOLIO accordance with the terms of the Mortgage
HERTZ INDIANAPOLIS SQUARE Loan.
TRIWEST PLAZA
XXXXXX-XXXXXX
SOUTH XXXXXX APARTMENTS
HERTZ INDIANAPOLIS SQUARE There is a $5,200,000 mezzanine loan secured
by a Pledge and Security Agreement from the
mezzanine borrower pursuant to which the
mezzanine lender is granted a first priority
security interest in all of the mezzanine
borrower's ownership interests in the
Mortgagor and its managing members.
TRIWEST PLAZA Subordinate financing is permitted in
GIANT FOOD - BUCKS COUNTY accordance with the terms of the Mortgage
CENTRAL SELF STORAGE Loan.
HOUSTON LEISURE RV RESORT
EXCEPTIONS TO REPRESENTATION (37)
LOANS EXCEPTIONS
----- ----------
CORNERSTONE AT XXXXXXX The Mortgagor has potential obligations in
addition to owning and maintaining the
Mortgaged Property, specifically making bond
payments in the event of a tax shortfall and
operating, maintaining, buying insurance on,
and purchasing a parking garage.
VILLAGE SQUIRE APARTMENTS The Mortgagor does not segregate security
deposits. Michigan law permits commingling,
provided landlord posts a statutory bond,
which the Mortgagor has done.
EXCEPTIONS TO REPRESENTATION (38)
LOANS EXCEPTIONS
----- ----------
225 FRANKLIN There is no individual or entity other than
the Mortgagor who is liable for the
non-recourse carveouts.
DCT INDUSTRIAL PORTFOLIO There is no natural person guaranteeing the
MAYO MEDICAL BUILDING non-recourse carveouts.
XXXXXX MHP The liability cap under the Guaranty is
$21,000,000.
EXCEPTIONS TO REPRESENTATION (40)
LOANS EXCEPTIONS
----- ----------
DCT INDUSTRIAL PORTFOLIO The Mortgage Loan documents permit partial
defeasance at 110% of the allocated loan
amount.
XXXXXXX PORTFOLIO DAKOTAS The Mortgage Loan documents permit
XXXXXX HOTEL PORTFOLIO partial defeasance at 125% of the allocated
XXXXXXX PORTFOLIO WEST VIRGINIA loan amount.
CENTER POINT COMPLEX
000 00XX XXXXXX The Mortgage Loan documents permit partial
defeasance at a fair market value purchase
price.
EXCEPTIONS TO REPRESENTATION (43)
225 FRANKLIN Terrorism insurance is capped at an amount
equal to the greater of (a) 150% of the
aggregate insurance premiums payable solely
with respect to the terrorism insurance
carried by the Mortgagor in connection with
the Mortgaged Property and accepted by the
mortgagee as of origination (either stand
alone coverage or allocated under an
all-risk policy) adjusted annually by a
percentage equal to the increase in the
Consumer Price Index, and (b) 150% of the
aggregate insurance premiums payable with
respect to the terrorism insurance carried
by the Mortgagor with respect to the
Mortgaged Property as required pursuant to
the Mortgage Loan documents (either as stand
alone coverage or allocated under an
all-risk policy) for the immediately prior
twelve (12) month period.
DCT INDUSTRIAL PORTFOLIO Terrorism insurance is capped at such amount
as can be purchased at a premium (solely for
such coverage) equal to 105% of the premium
payable by the Mortgagor as of origination
for all risk and business interruption
coverage.
VILLAGE SQUIRE APARTMENTS The Mortgagor's current insurance policy
does not obligate the Mortgagor to maintain
terrorism insurance. The non-recourse
carveouts were modified to provide for
liability to the Mortgagor and the guarantor
for any loss, damage or claim related to any
act or acts of terrorism in the event the
insurance coverage for the Mortgaged
Property does not include coverage for acts
of terrorism or if the Mortgaged Property is
not rebuilt after a casualty occurs as a
result of any act of terrorism.
EXCEPTIONS TO REPRESENTATION (44)
LOANS EXCEPTIONS
----- ----------
0000 XXXXXX XXXXXX BUILDING This is an IDOT loan. The IDOT grantor, and
not the borrower, is required to provide the
financial documentation to mortgagee.
EXCEPTIONS TO REPRESENTATION (49)
LOANS EXCEPTIONS
----- ----------
QUAIL HOLLOW APARTMENTS The tax parcel identification number
currently assigned to the Mortgaged Property
includes certain additional adjacent real
property that is not encumbered by the lien
of Mortgage. the Mortgagor agreed to ensure
that the Mortgaged Property is a separate
tax parcel effective as of the 2007 tax
year. Until this has been completed, the
mortgagee shall require the Mortgagor to
deposit an amount sufficient to pay all
taxes, assessments and other similar charges
levied, assessed or imposed against the
additional property.
Schedule B to Exhibit 2
List of Mortgagors that are Third-Party Beneficiaries Under Section 5.5
None
Schedule C to Exhibit 2
List of Mortgage Loans Subject to Secured Creditor Impaired Property Policies
None
EXHIBIT 3
PRICING FORMULATION
MSCI 2006-HQ9
--------------------------------------------------------------------------------
Total Bond Proceeds $2,592,379,135
Less Expenses $ 4,395,862
--------------
Net Proceeds $2,596,774,997
Less Purchase Price of LaSalle Loans
Discounted Value of LaSalle Loans $ 824,934,902
Allocable Expense Amount for LaSalle Loans $ 1,380,858
--------------
Purchase Price of LaSalle Loans $ 826,315,760
Less Purchase Price of MS Loans
Discounted Value of MS Loans $1,545,840,219
Allocable Expense Amount for MS Loans $ 2,643,230
--------------
Purchase Price of MS Loans $1,548,483,449
Less Purchase Price of PCF II Loans
Discounted Value of PCF II Loans $ 221,604,014
Allocable Expense Amount for PCF II Loans $ 371,774
--------------
Purchase Price of PCF II Loans $ 221,975,788
3-1
EXHIBIT 4
XXXX OF SALE
1. Parties. The parties to this Xxxx of Sale are the following:
Seller: LaSalle Bank National Association
Purchaser: Xxxxxx Xxxxxxx Capital I Inc.
2. Sale. For value received, Seller hereby conveys to Purchaser, without
recourse, all right, title and interest in and to the Mortgage Loans identified
on Exhibit 1 (the "Mortgage Loan Schedule") to the Mortgage Loan Purchase
Agreement, dated as of August 8, 2006 (the "Mortgage Loan Purchase Agreement"),
between Seller and Purchaser and all of the following property:
(a) All accounts, general intangibles, chattel paper, instruments,
documents, money, deposit accounts, certificates of deposit, goods, letters
of credit, advices of credit and investment property consisting of, arising
from or relating to any of the following property: the Mortgage Loans
identified on the Mortgage Loan Schedule including the related Mortgage
Notes, Mortgages, security agreements, and title, hazard and other
insurance policies, all distributions with respect thereto payable after
the Cut-Off Date, all substitute or replacement Mortgage Loans and all
distributions with respect thereto, and the Mortgage Files;
(b) All accounts, general intangibles, chattel paper, instruments,
documents, money, deposit accounts, certificates of deposit, goods, letters
of credit, advices of credit, investment property, and other rights arising
from or by virtue of the disposition of, or collections with respect to, or
insurance proceeds payable with respect to, or claims against other Persons
with respect to, all or any part of the collateral described in clause (a)
above (including any accrued discount realized on liquidation of any
investment purchased at a discount); and
(c) All cash and non-cash proceeds of the collateral described in
clauses (a) and (b) above.
3. Purchase Price. The amount and other consideration set forth on Exhibit
3 to the Mortgage Loan Purchase Agreement.
4. Definitions. Terms used but not defined herein shall have the meanings
assigned to them in the Mortgage Loan Purchase Agreement.
4-1
IN WITNESS WHEREOF, each of the parties hereto has caused this Xxxx of Sale to
be duly executed and delivered on this __ day of August, 2006.
SELLER: LASALLE BANK NATIONAL ASSOCIATION
By:
------------------------------------
Name:
------------------------------
Title:
-----------------------------
PURCHASER: XXXXXX XXXXXXX CAPITAL I INC.
By:
------------------------------------
Name:
------------------------------
Title:
-----------------------------
EXHIBIT 5
FORM OF LIMITED POWER OF ATTORNEY
LIMITED POWER OF ATTORNEY
TO HSBC BANK USA, NATIONAL ASSOCIATION
AND X.X. XXXXXX COMPANY, INC.
WITH RESPECT TO
XXXXXX XXXXXXX CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 2006-HQ9
KNOW ALL MEN BY THESE PRESENTS:
WHEREAS, pursuant to the terms of the Mortgage Loan Purchase Agreement
dated as of August 8, 2006 (the "Mortgage Loan Purchase Agreement"), between
LaSalle Bank National Association ("LaSalle") and Xxxxxx Xxxxxxx Capital I Inc.
("Depositor"), LaSalle is selling certain multifamily and commercial mortgage
loans (the "Mortgage Loans") to Depositor;
WHEREAS, pursuant to the terms of the Pooling and Servicing Agreement dated
as of August 1, 2006 (the "Pooling and Servicing Agreement"), between the
Depositor, Xxxxx Fargo Bank National Association, as Master Servicer, X.X.
Xxxxxx Company, Inc. ("JER") as Special Servicer, LaSalle Bank National
Association, as Paying Agent, Custodian, Certificate Registrar and
Authenticating Agent and HSBC Bank USA, National Association ("HSBC") as
Trustee, the Trustee and the Special Servicer are granted certain powers,
responsibilities and authority in connection with the completion and the filing
and recording of assignments of mortgage, deeds of trust or similar documents,
Form UCC-2 and UCC-3 assignments of financing statements, reassignments of
assignments of leases, rents and profits and other Mortgage Loan documents
required to be filed or recorded in appropriate public filing and recording
offices;
WHEREAS, LaSalle has agreed to provide this Limited Power of Attorney
pursuant to the Mortgage Loan Purchase Agreement;
NOW, THEREFORE, LaSalle does hereby make, constitute and appoint HSBC,
acting solely in its capacity as Trustee under, and in accordance with the terms
of, the Pooling and Servicing Agreement, LaSalle's true and lawful agent and
attorney-in-fact with respect to each Mortgage Loan in LaSalle's name, place and
stead: (i) to complete (to the extent necessary) and to cause to be submitted
for filing or recording in the appropriate public filing or recording offices,
all assignments of mortgage, deeds of trust or similar documents, assignments or
reassignments of rents, leases and profits, in each case in favor of the
Trustee, as set forth in the definition of "Mortgage File" in Section 1.1 of the
Pooling and Servicing Agreement, that have been received by the Trustee or a
Custodian on its behalf, and all Form UCC-2 or UCC-3 assignments of financing
statements and all other comparable instruments or documents with respect to the
Mortgage Loans which are customarily and reasonably necessary or appropriate to
assign agreements, documents and instruments pertaining to the Mortgage Loans,
in each case in
5-1
favor of the Trustee as set forth in the definition of "Mortgage File" in, and
in accordance with Section 1.1 of, the Pooling and Servicing Agreement, and to
evidence, provide notice of and perfect such assignments and conveyances in
favor of the Trustee in the public records of the appropriate filing and
recording offices; and (ii) to file or record in the appropriate public filing
or recording offices, all other Mortgage Loan documents to be recorded under the
terms of the Pooling and Servicing Agreement or any such Mortgage Loan documents
which have not been submitted for filing or recordation by LaSalle on or before
the date hereof or which have been so submitted but are subsequently lost or
returned unrecorded or unfiled as a result of actual or purported defects
therein, in order to evidence, provide notice of and perfect such documents in
the public records of the appropriate filing and recording offices.
Notwithstanding the foregoing, this Limited Power of Attorney shall grant to
HSBC and JER only such powers, responsibilities and authority as are set forth
in Section 2.1 of the Mortgage Loan Purchase Agreement.
LaSalle does also hereby make, constitute and appoint JER, acting solely in
its capacity as Special Servicer under the Pooling and Servicing Agreement,
LaSalle's true and lawful agent and attorney-in-fact with respect to the
Mortgage Loans in LaSalle's name, place and stead solely to exercise and perform
all of the rights, authority and powers of HSBC as set forth in the preceding
paragraph in the event of the failure or the incapacity of HSBC to do so for any
reason. As between JER and any third party, no evidence of the failure or
incapacity of HSBC shall be required and such third party may rely upon JER's
written statement that it is acting pursuant to the terms of this Limited Power
of Attorney.
17.
The enumeration of particular powers herein is not intended in any way to
limit the grant to either the Trustee or the Special Servicer as LaSalle's
attorney-in-fact of full power and authority with respect to the Mortgage Loans
to complete (to the extent necessary), file and record any documents,
instruments or other writings referred to above as fully, to all intents and
purposes, as LaSalle might or could do if personally present, hereby ratifying
and confirming whatsoever such attorney-in-fact shall and may do by virtue
hereof; and LaSalle agrees and represents to those dealing with such
attorney-in-fact that they may rely upon this Limited Power of Attorney until
termination thereof under the provisions of Article III below. As between
LaSalle, the Depositor, the Master Servicer, the Special Servicer, the Trustee,
the Trust Fund and the Certificateholders, neither the Trustee nor the Special
Servicer may exercise any right, authority or power granted by this Limited
Power of Attorney in a manner which would violate the terms of the Pooling and
Servicing Agreement, but any and all third parties dealing with either the
Trustee or the Special Servicer as LaSalle's attorney-in-fact may rely
completely, unconditionally and conclusively on the authority of the Trustee or
the Special Servicer, as applicable, and need not make any inquiry about whether
the Trustee or the Special Servicer is acting pursuant to the Pooling and
Servicing Agreement. Any purchaser, title insurance company or other third party
may rely upon a written statement by either the Trustee or the Special Servicer
that any particular Mortgage Loan or related mortgaged real property in question
is subject to and included under this Limited Power of Attorney and the Pooling
and Servicing Agreement.
18.
Any act or thing lawfully done hereunder by either the Trustee or the
Special Servicer shall be binding on LaSalle and LaSalle's successors and
assigns.
19.
This Limited Power of Attorney shall continue in full force and effect with
respect to the Trustee and the Special Servicer, as applicable, until the
earliest occurrence of any of the following events:
19.1 with respect to the Trustee, the termination of the Trustee and its
replacement with a successor Trustee under the terms of the Pooling
and Servicing Agreement;
19.2 with respect to the Special Servicer, the termination of the Special
Servicer and its replacement with a successor Special Servicer under
the terms of the Pooling and Servicing Agreement;
19.3 with respect to the Trustee, the appointment of a receiver or
conservator with respect to the business of the Trustee, or the filing
of a voluntary or involuntary petition in bankruptcy by or against the
Trustee;
19.4 with respect to the Special Servicer, the appointment of a receiver or
conservator with respect to the business of the Special Servicer, or
the filing of a voluntary or involuntary petition in bankruptcy by or
against the Special Servicer;
19.5 with respect to each of the Trustee and the Special Servicer and any
Mortgage Loan, such Mortgage Loan is no longer a part of the Trust
Fund;
19.6 with respect to each of the Trustee and the Special Servicer, the
termination of the Pooling and Servicing Agreement in accordance with
its terms; and
19.7 with respect to the Special Servicer, the occurrence of an Event of
Default under the Pooling and Servicing Agreement with respect to the
Special Servicer.
Nothing herein shall be deemed to amend or modify the Pooling and Servicing
Agreement, the Mortgage Loan Purchase Agreement or the respective rights, duties
or obligations of LaSalle under the Mortgage Loan Purchase Agreement, and
nothing herein shall constitute a waiver of any rights or remedies under the
Pooling and Servicing Agreement.
20.
Capitalized terms used but not defined herein have the respective meanings
assigned thereto in the Mortgage Loan Purchase Agreement.
21.
THIS LIMITED POWER OF ATTORNEY SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AND THE OBLIGATIONS, RIGHTS
AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH
SUCH LAWS WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES APPLIED IN NEW YORK.
[Signature on next page]
IN WITNESS WHEREOF, LaSalle has caused this instrument to be executed and
its corporate seal to be affixed hereto by its officer duly authorized as of
August 17, 2006.
LASALLE BANK NATIONAL ASSOCIATION
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
ACKNOWLEDGEMENT
STATE OF )
)ss:
COUNTY OF )
On this 17th day of August, 2006, before me appeared __________________, to
me personally known, who, being by me duly sworn did say that he/she is the
_____________________ of LaSalle Bank National Association, and that the seal
affixed to the foregoing instrument is the corporate seal of said corporation,
and that said instrument was signed and sealed in behalf of said corporation by
authority of its board of directors, and said __________________ acknowledged
said instrument to be the free act and deed of said corporation.
----------------------------------------
Name:
-----------------------------------
Notary Public in and for said
County and State
My Commission Expires:
-------------------------------------
