MORTGAGE LOAN PURCHASE AGREEMENT
This Mortgage Loan Purchase Agreement (this "Agreement"), is
dated and effective as of November 1, 2001, between National Consumer
Cooperative Bank, a federally chartered corporation ("NCB"), as seller (in such
capacity, together with its successors and permitted assigns hereunder, the
"Seller"), and Credit Suisse First Boston Mortgage Securities Corp., a Delaware
corporation ("CSFB Mortgage Securities"), as purchaser (in such capacity,
together with its successors and permitted assigns hereunder, the "Purchaser").
RECITALS
NCB desires to sell, assign, transfer, set over and otherwise
convey to CSFB Mortgage Securities, without recourse, and CSFB Mortgage
Securities desires to purchase, subject to the terms and conditions set forth
herein, the multifamily and commercial mortgage loans (collectively, the
"Mortgage Loans") identified on the schedule annexed hereto as Exhibit A, as
such schedule may be amended from time to time pursuant to the terms hereof.
CSFB Mortgage Securities intends to create a trust (the
"Trust"), the primary assets of which will be a segregated pool of multifamily
and commercial mortgage loans that includes the Mortgage Loans. Beneficial
ownership of the assets of the Trust (such assets collectively, the "Trust
Fund") will be evidenced by a series of mortgage pass-through certificates (the
"Certificates"). Certain classes of the Certificates will be rated by Standard &
Poor's Ratings Services, a division of The XxXxxx-Xxxx Companies, Inc., and
Xxxxx'x Investors Service, Inc. (together, the "Rating Agencies"). The Trust
will be created and the Certificates will be issued pursuant to a pooling and
servicing Agreement dated as of November 12, 2001 (the "Pooling and Servicing
Agreement"), among CSFB Mortgage Securities as depositor, KeyCorp Real Estate
Capital Markets, Inc. d/b/a Key Commercial Mortgage, as master servicer and
special servicer of non-residential cooperative mortgage loans, National
Consumer Cooperative Bank, as master servicer and special servicer of
residential cooperative mortgage loans, and Xxxxx Fargo Bank Minnesota, N.A., as
trustee. Capitalized terms used but not otherwise defined herein shall have the
respective meanings assigned to them in the Pooling and Servicing Agreement as
in full force and effect on the Closing Date (as defined in Section 1 hereof).
It is anticipated that CSFB Mortgage Securities will transfer the Mortgage Loans
to the Trust contemporaneously with its purchase of the Mortgage Loans
hereunder.
CSFB Mortgage Securities intends to sell certain classes of
the Certificates (collectively, the "Publicly Offered Certificates") to Credit
Suisse First Boston Corporation ("CSFB Corporation") and the other underwriters
named in the Underwriting Agreement (as defined below) (collectively in such
capacity, the "Underwriters"), pursuant to an underwriting agreement dated as of
November 1, 2001 (the "Underwriting Agreement), between CSFB Mortgage Securities
and CSFB Corporation as representative of the Underwriters, and CSFB Mortgage
Securities intends to sell certain classes of the remaining Certificates (the
"Privately Offered Certificates") to CSFB Corporation, pursuant to a certificate
purchase agreement dated as of the date hereof (the "Certificate Purchase
Agreement"), between CSFB Mortgage Securities and the CSFB Corporation. The
Publicly Offered are more fully described in a prospectus dated October 22, 2001
(the "Basic Prospectus"), and the supplement to the Basic Prospectus dated
November 1, 2001 (the "Prospectus Supplement" and, together with the Basic
Prospectus, the "Prospectus"), as each may be amended or supplemented at any
time hereafter. The Privately Offered Certificates are more fully described in a
confidential offering circular dated
November 1, 2001 (the "Confidential Offering Circular"), as it may be amended or
supplemented at any time hereafter.
NCB will indemnify CSFB Mortgage Securities, CSFB Corporation,
the other Underwriters and certain related parties with respect to the
disclosure regarding the Mortgage Loans contained in the Prospectus, the
Confidential Offering Circular and certain other disclosure documents and
offering materials relating to the Certificates, pursuant to an indemnification
agreement dated as of November 1, 2001 (the "Indemnification Agreement"), among
NCB, CSFB Mortgage Securities and CSFB Corporation, both as a representative of
the Underwriters and as initial purchaser of the Privately Offered Certificates.
NOW, THEREFORE, in consideration of the premises and the
mutual agreements set forth herein, the parties agree as follows:
SECTION 1. Agreement to Purchase. The Seller agrees to sell,
assign, transfer, set over and otherwise convey to the Purchaser, without
recourse, and the Purchaser agrees to purchase from the Seller, subject to the
terms and conditions set forth herein, the Mortgage Loans. The purchase and sale
of the Mortgage Loans shall take place on November 13, 2001 or such other date
as shall be mutually acceptable to the parties hereto (the "Closing Date"). As
of the close of business on the respective Due Dates for the Mortgage Loans in
November 2001 (individually and collectively, the "Cut-off Date"), the Mortgage
Loans will have an aggregate principal balance, after application of all
payments of principal due on the Mortgage Loans on or before the Cut-off Date,
whether or not received, of $93,311,315, subject to a variance of plus or minus
5%. The consideration for the Mortgage Loans shall be: (i) cash in the amount of
109.2% of such aggregate principal balance of the Mortgage Loans, together with
accrued interest on the Mortgage Loans at their respective Net Mortgage Rates
from and including November 1, 2001 to but not including the Closing Date, which
cash amount the Purchaser shall pay to the Seller on the Closing Date by wire
transfer in immediately available funds or by such other method as shall be
mutually acceptable to the parties hereto; and (b) all of the Class A-Y
Certificates, which the Purchaser shall deliver in book-entry form, directly or
through CSFB Corporation, to the Seller.
SECTION 2. Conveyance of the Mortgage Loans.
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(a) Effective as of the Closing Date, subject only to receipt
of the consideration referred to in Section 1 hereof, the Seller does hereby
sell, assign, transfer, set over and otherwise convey to the Purchaser, without
recourse, all of the right, title and interest of the Seller in and to the
Mortgage Loans, including all interest and principal received on or with respect
to the Mortgage Loans after the Cut-off Date (other than scheduled payments of
interest and principal due on or before the Cut-off Date), together with all of
the right, title and interest of the Seller in and to the proceeds of any
related title, hazard or other insurance policies and any escrow, reserve or
other comparable accounts related to the Mortgage Loans.
(b) The Purchaser shall be entitled to receive all scheduled
payments of principal and interest due on the Mortgage Loans after the Cut-off
Date, and all other recoveries of principal and interest collected thereon after
the Cut-off Date (other than scheduled payments of principal and interest due on
the Mortgage Loans on or before the Cut-off Date and collected after the Cut-off
Date, which shall belong to the Seller).
(c) On or before the Closing Date, the Seller shall, at its
expense, deliver to and deposit with, or cause to be delivered to and deposited
with, the Purchaser or its designee the Mortgage File and any Additional
Collateral (other than reserve funds and escrow payments) with respect to each
Mortgage Loan. In addition, with respect to each Mortgage Loan, as to which any
Additional Collateral is in the form of a Letter of Credit as of the Closing
Date, the Seller shall cause to be prepared, executed and delivered to the
issuer of each such Letter of Credit such notices, assignments and
acknowledgments as are required under such Letter of Credit to assign, without
recourse, to the Trustee the Seller's rights as the beneficiary thereof and
drawing party thereunder. The designated recipient of the items described in the
second preceding sentence, and the designated beneficiary under each Letter of
Credit referred to in the preceding sentence, shall be the Trustee.
If the Seller cannot deliver on the Closing Date any original
or certified recorded document or original policy of title insurance which is to
be delivered as part of the related Mortgage File for any Mortgage Loan solely
because the Seller is delayed in making such delivery by reason of the fact that
such original or certified recorded document has not been returned by the
appropriate recording office or such original policy of title insurance has not
yet been issued, then the Seller shall deliver such documents to the Purchaser
or its designee, promptly upon the Seller's receipt thereof.
In addition, the Seller shall, at its expense, deliver to and
deposit with, or cause to be delivered to and deposited with, the Purchaser or
its designee, on or before the Closing Date, the following items (except to the
extent that any of the following items are to be retained by a subservicer that
will continue to act on behalf of the Purchaser or its designee): (i) originals
or copies of all financial statements, appraisals, environmental/engineering
reports, leases, rent rolls (or, in the case of any Mortgage Loans secured by
residential cooperative properties, maintenance schedules), third-party
underwriting reports, insurance policies, legal opinions, tenant estoppels and
any other documents that the Purchaser or its servicing agent reasonably deems
necessary to service the subject Mortgage Loan in the possession or under the
control of the Seller that relate to the Mortgage Loans and, to the extent they
are not required to be a part of a Mortgage File for any Mortgage Loan,
originals or copies of all documents, certificates and opinions in the
possession or under the control of the Seller that were delivered by or on
behalf of the related Borrowers in connection with the origination of the
Mortgage Loans (provided that the Seller shall not be required to deliver
documents or materials prepared by the Seller or its affiliates solely for
internal uses); and (ii) all unapplied reserve funds and escrow payments in the
possession or under the control of the Seller that relate to the Mortgage Loans.
The designated recipient of the items described in clauses (i) and (ii) of the
preceding sentence shall be the applicable Master Servicer.
Notwithstanding the foregoing, if the Seller is unable to
deliver any Letter of Credit constituting Additional Collateral for any Mortgage
Loan then the Seller may, in lieu thereof, deliver on behalf of the related
Borrower, to be used for the same purposes as such missing Letter of Credit
either: (i) a substitute letter of credit substantially comparable to, but in
all cases in the same amount and with the same draw conditions and renewal
rights as, that Letter of Credit and issued by an obligor that meets any
criteria in the related Mortgage Loan Documents applicable to the issuer of that
Letter of Credit; or (ii) a cash reserve in an amount equal to the amount of
that Letter of Credit. For purposes of the delivery requirements of this Section
2(c), any such substitute letter of credit shall be deemed to be Additional
Collateral of the type covered by the first paragraph of this Section 2(c) and
any such cash reserve shall be deemed to be reserve funds of the type covered by
the third paragraph of this Section 2(c).
In connection with the foregoing paragraphs of this Section
2(c), the Seller is a designated recipient, or shall otherwise be the
beneficiary, of all certifications relating to the Mortgage Loans made and/or
delivered by the Trustee pursuant to Section 2.02(a) and Section 2.02(b) of the
Pooling and Servicing Agreement. To the extent that those certifications and/or
the related exception reports reflect Document Defects with respect to the
Mortgage Loans, those certifications and/or the related exception reports shall
constitute notice to the Seller for purposes of Section 5 upon receipt thereof
by the Seller.
(d) The Seller shall be responsible for all reasonable fees
and out-of-pocket costs and expenses associated with recording and/or filing any
and all assignments and other instruments of transfer with respect to the
Mortgage Loans that are required to be recorded or filed, as the case may be,
under the Pooling and Servicing Agreement; provided that the Seller shall not be
responsible for actually recording or filing any such assignments or other
instruments of transfer. If the Seller receives written notice that any such
assignment or other instrument of transfer is lost or returned unrecorded or
unfiled, as the case may be, because of a defect therein, the Seller shall
prepare or cause the preparation of a substitute therefor or cure such defect,
as the case may be; provided that the cost of such preparation shall be borne by
the Purchaser if the loss or return is caused by the Purchaser's negligence. The
Seller shall provide the Purchaser or its designee with a power of attorney to
enable it or them to record any loan documents that the Purchaser has been
unable to record. Unless the Purchaser notifies the Seller in writing to the
contrary, the designated recipients of the power of attorney referred to in the
preceding sentence shall be the Trustee.
(e) The Seller shall, under generally accepted accounting
principles ("GAAP"), report its transfer of the Mortgage Loans to the Purchaser,
as provided herein, as a sale of the Mortgage Loans to the Purchaser in exchange
for the consideration specified in Section 1 hereof. In connection with the
foregoing, the Seller shall cause all of its financial and accounting records to
reflect such transfer as a sale (as opposed to a secured loan). Regardless of
its treatment of the transfer of the Mortgage Loans to the Purchaser under GAAP,
the Seller shall at all times following the Closing Date cause all of its
records and financial statements and any relevant consolidated financial
statements of any direct or indirect parent to clearly reflect that the Mortgage
Loans have been transferred to the Purchaser and are no longer available to
satisfy claims of the Seller's creditors.
(f) After the Seller's transfer of the Mortgage Loans to the
Purchaser, as provided herein, the Seller shall not take any action inconsistent
with the Purchaser's ownership of the Mortgage Loans. Except for actions that
are the express responsibility of another party hereunder or under the Pooling
and Servicing Agreement, and further except for actions that the Seller is
expressly permitted to complete subsequent to the Closing Date, the Seller
shall, on or before the Closing Date, take all actions required under applicable
law to effectuate the transfer of the Mortgage Loans by the Seller to the
Purchaser.
(g) The Mortgage Loan Schedule, as it may be amended from time
to time, shall conform to the requirements set forth in the Pooling and
Servicing Agreement. The Seller shall, within 15 days of its discovery or
receipt of notice of any error on the Mortgage Loan Schedule, amend such
Mortgage Loan Schedule and deliver to the Purchaser or the Trustee, as the case
may be, an amended Mortgage Loan Schedule.
SECTION 3. Examination of Mortgage Loan Files and Due
Diligence Review. The Seller shall reasonably cooperate with any examination of
the Mortgage Files for, and any other documents and records relating to, the
Mortgage Loans, that may be undertaken by or on behalf of the Purchaser. The
fact that the Purchaser has conducted or has failed to conduct any partial or
complete examination of any of the Mortgage Files for, and/or any of such other
documents and records relating to, the Mortgage Loans, shall not affect the
Purchaser's right to pursue any remedy available in equity or at law for a
breach of the Seller's representations and warranties made pursuant to Section 4
(subject, however, to Section 5(d)).
SECTION 4. Representations, Warranties and Covenants of the
Seller and the Purchaser.
(a) The Seller hereby makes, as of the Closing Date, to and
for the benefit of the Purchaser, each of the representations and warranties set
forth in Exhibit B-1. The Purchaser hereby makes, as of the Closing Date, to and
for the benefit of the Seller, each of the representations and warranties set
forth in Exhibit B-2.
(b) The Seller hereby makes, as of the Closing Date (or as of
such other date specifically provided in the particular representation or
warranty), to and for the benefit of the Purchaser, with respect to each
Mortgage Loan, each of the representations and warranties set forth in
Exhibit C.
(c) The Seller hereby represents and warrants, as of the
Closing Date, to and for the benefit of CSFB Mortgage Securities only, that the
Seller has not dealt with any broker, investment banker, agent or other person
(other than the CSFB Mortgage Securities, CSFB Corporation and the other
Underwriters) who may be entitled to any commission or compensation in
connection with the sale to the Purchaser of the Mortgage Loans. The Seller
hereby further represents and warrants, as of the Closing Date, to and for the
benefit of CSFB Mortgage Securities only, that:
(i) the Seller is an "accredited investor" within the
meaning of Rule 501(a)(1), (2), (3) or (7) under
the Securities Act of 1933, as amended
(the "Securities Act");
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(ii) the Seller has no present intent to sell the Class
A-Y Certificates;
(iii) the Seller (a) will not solicit offers for, or offer
or sell, the Class A-Y Certificates by a form of
general solicitation or general advertising (as those
terms are used in Regulation D promulgated pursuant
to the Securities Act) or in any manner involving a
public offering within the meaning of Section 4(2) of
the Securities Act and (b) has solicited and will
solicit offers for the Private Certificates only
from, and has offered and will offer the Private
Certificates only to, (1) persons that it reasonably
believes to be "qualified institutional buyers" (as
defined in Rule 144A under the Securities Act) in
accordance with said Rule 144A, (2) persons that are
not U. S. persons (as defined in Rule 902 under the
Securities Act) and that are located outside the
United States, its territories and possessions, in
accordance with Rule 903 of Regulation S under the
Securities Act, or (3) "accredited investors" as
defined in paragraphs (1), (2), (3) and (7) of Rule
501(a) under the Securities Act, and/or any entity in
which all of the equity owners come within such
paragraphs, in transactions which are otherwise
exempt from the registration requirements under the
Securities Act;
(iv) the Seller is not (a) an employee benefit plan
subject to the fiduciary responsibility provisions of
the Employee Retirement Income Security Act of 1974,
as amended ("ERISA"), or Section 4975 of the Internal
Revenue Code of 1986, as amended (the "Code"), or a
governmental plan (as defined in Section 3(32) of
ERISA) subject to any federal, state or local law
that is, to a material extent, similar to the
foregoing provisions of ERISA or the Code (each, a
"Plan") or (b) a person acting on behalf of or using
the assets of any such Plan (including an entity
whose underlying assets include Plan assets by reason
of investment in the entity by such Plan and the
application of Department of Labor Regulation Section
2510.3-101);
(v) the Seller will comply with all applicable federal
and state securities laws in connection with any
subsequent resale of the Class A-Y Certificates by
the Seller;
(vi) in connection with any resale of the Class A-Y
Certificates, the Seller will comply with any
applicable requirements set forth in Section 5.02 of
the Pooling and Servicing Agreement; and
(vii) the Seller understands that (A) the Class A-Y
Certificates have not been and will not be registered
under the Securities Act, CSFB Mortgage Securities is
not required to so register the Class A-Y
Certificates and the Class A-Y Certificates may be
resold only if registered pursuant to the provisions
of the Securities Act or an exemption from such
registration is available, (B) the Pooling and
Servicing Agreement contains restrictions regarding
the transfer of the Class A-Y Certificates, the Class
A-Y Certificates will bear a legend to the foregoing
effect and (C) the Seller has received a copy of the
Pooling and Servicing Agreement and such other
information concerning the Class A-Y Certificates
from CSFB Mortgage Securities as has been requested
by the Seller and is relevant to the Seller's
decision to accept the Class A-Y Certificates.
(d) The Seller hereby agrees that it shall be deemed to make,
as of the date of substitution, to and for the benefit of the Purchaser, with
respect to any replacement mortgage loan (a "Replacement Mortgage Loan") that is
substituted for a Defective Mortgage Loan (as defined in Section 5(a) hereof),
pursuant to Section 5(a) of this Agreement, each of the representations and
warranties set forth in Exhibit C (references therein to "Closing Date" being
deemed to be references to the "date of substitution", references therein to
"Cut-off Date" being deemed to be references to the "most recent Due Date for
the subject Replacement Mortgage Loan on or before the date of substitution" and
references to "November 2001" and "October 2001" being deemed to be references
to the "month of substitution" and the "month preceding the month of
substitution", respectively). From and after the date of substitution, each
Replacement Mortgage Loan, if any, shall be deemed to constitute a "Mortgage
Loan" hereunder for all purposes.
(e) It is understood and agreed that the representations and
warranties set forth in this Section 4 shall survive delivery of the respective
Mortgage Files to the Purchaser or its designee and shall inure to the benefit
of the Purchaser for so long as any of the Mortgage Loans remains outstanding,
notwithstanding any restrictive or qualified endorsement or assignment.
SECTION 5. Notice of Breach; Cure, Repurchase and
Substitution.
(a) The Purchaser or its designee shall provide the Seller
with written notice of any Material Breach or Material Document Defect with
respect to any Mortgage Loan. Within 90 days (or
in the case of a Material Document Defect that consists of the failure to
deliver a Specially Designated Mortgage Loan Document, 15 days) of the earlier
of discovery or receipt of written notice by the Seller that there has been a
Material Breach or Material Document Defect with respect to any Mortgage Loan
(such 90-day (or, if applicable, 15-day) period, the "Initial Resolution
Period"), the Seller shall, subject to Section 5(b) and Section 5(c) below, (i)
correct or cure such Material Breach or Material Document Defect, as the case
may be, in all material respects or (ii) repurchase the Mortgage Loan affected
by such Material Breach or Material Document Defect, as the case may be (such
Mortgage Loan, a "Defective Mortgage Loan"), at the related Purchase Price, with
payment to be made in accordance with the reasonable directions of the
Purchaser; provided that if the Seller shall have delivered to the Purchaser a
certification executed on behalf of the Seller by an officer thereof stating (i)
that such Material Breach or Material Document Defect, as the case may be, does
not relate to whether the Defective Mortgage Loan is or, as of the Closing Date
(or, in the case of a Replacement Mortgage Loan, as of the related date of
substitution), was a "qualified mortgage" within the meaning of Section
860G(a)(3) of the Code (a "Qualified Mortgage"), (ii) that such Material Breach
or Material Document Defect, as the case may be, is capable of being cured but
not within the applicable Initial Resolution Period, (iii) that the Seller has
commenced and is diligently proceeding with the cure of such Material Breach or
Material Document Defect, as the case may be, within the applicable Initial
Resolution Period, (iv) what actions the Seller is pursuing in connection with
the cure thereof and (v) that the Seller anticipates that such Material Breach
or Material Document Defect, as the case may be, will be cured within an
additional period not to exceed the applicable Resolution Extension Period (as
defined below), then the Seller shall have an additional period equal to the
applicable Resolution Extension Period to complete such cure or, failing such,
to repurchase the Defective Mortgage Loan; and provided, further, that, if the
Seller's obligation to repurchase any Defective Mortgage Loan as a result of a
Material Breach or Material Document Defect arises within the three-month period
commencing on the Closing Date (or within the two-year period commencing on the
Closing Date if the Defective 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)), and if the Defective Mortgage Loan is still subject to the
Pooling and Servicing Agreement, the Seller may, at its option, subject to the
terms, conditions and limitations set forth in the Pooling and Servicing
Agreement, in lieu of repurchasing such Defective Mortgage Loan (but, in any
event, no later than such repurchase would have to have been completed), (i)
replace such Defective Mortgage Loan with one or more substitute mortgage loans
that individually and collectively satisfy the requirements of the definition of
"Qualifying Substitute Mortgage Loan" set forth in the Pooling and Servicing
Agreement, and (ii) pay any corresponding Substitution Shortfall Amount, such
substitution and payment to be effected in accordance with the terms of the
Pooling and Servicing Agreement. Any such repurchase or replacement of a
Defective Mortgage Loan shall be on a whole loan, servicing released basis. The
Seller shall have no obligation to monitor the Mortgage Loans regarding the
existence of a Material Breach or Material Document Defect, but if the Seller
discovers a Material Breach or Material Document Defect with respect to a any
Mortgage Loan, it will notify the Purchaser.
"Resolution Extension Period" shall mean:
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(i) for purposes of remediating a Material Breach with
respect to any Mortgage Loan, 90 days;
(ii) for purposes of remediating a Material Document
Defect with respect to any Mortgage Loan that is and
remains a Performing Mortgage Loan throughout the
applicable Initial Resolution
Period, the period commencing at the end of the
applicable Initial Resolution Period and ending on,
and including, the earlier of (A) the 90th day
following the end of such Initial Resolution Period
and (B) the 45th day following the Seller's receipt
of written notice from the Purchaser or its designee
of the occurrence of any Servicing Transfer Event
with respect to such Mortgage Loan subsequent to the
end of such Initial Resolution Period;
(iii) for purposes of remediating a Material Document
Defect with respect to any Mortgage Loan that is a
Performing Mortgage Loan as of the commencement of
the applicable Initial Resolution Period, but as to
which a Servicing Transfer Event occurs during such
Initial Resolution Period, the period commencing at
the end of the applicable Initial Resolution Period
and ending on, and including, the 90th day following
the earlier of (A) the end of such Initial Resolution
Period and (B) the Seller's receipt of written notice
from the Purchaser or its servicing agent of the
occurrence of such Servicing Transfer Event; and
(iv) for purposes of remediating a Material Document
Defect with respect to any Mortgage Loan that is a
Specially Serviced Mortgage Loan as of the
commencement of the applicable Initial Resolution
Period, zero (-0-) days, provided that, if the Seller
did not receive written notice from the Purchaser or
its servicing agent of the relevant Servicing
Transfer Event as of the commencement of the
applicable Initial Resolution Period, then such
Servicing Transfer Event will be deemed to have
occurred during such Initial Resolution Period and
clause (iii) of this definition will be deemed to
apply;
provided that, except as otherwise set forth in the following two provisos,
there shall be no Resolution Extension Period in respect of a Material Document
Defect involving a Specially Designated Mortgage Loan Document; and provided,
further, that if a Material Document Defect exists with respect to any Mortgage
Loan, if such Mortgage Loan is then subject to the Pooling and Servicing
Agreement, and if the Seller escrows with the applicable Master Servicer, prior
to the end of the Initial Resolution Period and any Resolution Extension Period
otherwise applicable to the remediation of such Material Document Defect without
regard to this proviso, cash in the amount of the then Purchase Price for such
Mortgage Loan and subsequently delivers to the applicable Master Servicer, on a
monthly basis, such additional cash as may be necessary to maintain a total
escrow equal to the Purchase Price for such Mortgage Loan as such price may
increase over time (the total amount of cash delivered to the applicable Master
Servicer with respect to any Mortgage Loan as contemplated by this proviso or
the immediately following proviso, the "Purchase Price Security Deposit"), then
the Resolution Extension Period applicable to the remediation of such Material
Document Defect shall be extended until the earliest of (i) the second
anniversary of the Closing Date, (ii) the date on which such Mortgage Loan is no
longer outstanding and part of the Trust Fund and (iii) if such Mortgage Loan
becomes a Specially Serviced Mortgage Loan under the Pooling and Servicing
Agreement, the date, if any, on which the applicable Special Servicer determines
in its reasonable, good faith judgment that such Material Document Defect will
materially interfere with or delay the realization against the related Mortgaged
Property or materially increase the cost thereof; and provided, further, that if
the Material Document Defect referred to in the preceding proviso consists of a
failure to deliver a Specially Designated Mortgage Loan Document, and if the
Seller delivers to the applicable Master Servicer a Purchase Price Security
Deposit equal to 25% of the outstanding principal balance of the subject
Mortgage Loan, then the Resolution Extension Period applicable to the
remediation of such Material Document Defect shall be extended to the 15th day
following the end of the applicable Initial Resolution Period.
The Purchaser or its designee shall establish, and maintain
any Purchase Price Security Deposit delivered to it with respect to any Mortgage
Loan in, one or more accounts (individually and collectively, the "Purchase
Price Security Deposit Account") and shall be entitled to make withdrawals from
such account(s) for the following purposes: (i) to cover any costs and expenses
resulting from the applicable Material Document Defect; (ii) upon any discounted
payoff or other liquidation of such Mortgage Loan, to cover any Realized Loss
related thereto; and (iii) if the Seller so directs, or if the balance on
deposit in the Purchase Price Security Deposit Account declines, and for 45 days
remains, below the Purchase Price for such Mortgage Loan (except where a
Purchase Price Security Deposit equal to 25% of the outstanding principal
balance of the subject Mortgage Loan is permitted to be delivered in order to
obtain a 15-day Resolution Extension Period with respect to the failure to
deliver a Specially Designated Mortgage Loan Document), or if such Material
Document is not remedied on or before the second anniversary of the Closing
Date, or if such Mortgage Loan becomes a Specially Serviced Mortgage Loan under
the Pooling and Servicing Agreement and the applicable Special Servicer
determines in its reasonable, good faith judgment that such Material Document
Defect will materially interfere with or delay the realization against the
related Mortgaged Property or materially increase the cost thereof, to apply the
Purchase Price Security Deposit to a full or partial, as applicable, payment of
the Purchase Price for such Mortgage Loan (with the Seller to pay any remaining
balance of such Purchase Price). The Seller may obtain a release of the Purchase
Price Security Deposit for any Mortgage Loan (net of any amounts payable
therefrom as contemplated by the prior sentence) upon such Mortgage Loan's being
paid in full or otherwise satisfied, liquidated or removed from the Trust Fund
or upon the subject Material Document Defect's being remedied in all material
respects and all associated fees and expenses being paid in full. The Seller may
direct the Purchaser or its designee to invest or cause the investment of the
funds deposited in any Purchase Price Security Deposit Account in one or more
Permitted Investments that bear interest or are sold at a discount and that
mature, unless payable on demand, no later than the Business Day prior to the
next Master Servicer Remittance Date. The Purchaser or its designee shall act
upon the written instructions of the Seller with respect to the investment of
funds in any Purchase Price Security Deposit Account in such Permitted
Investments, provided that in the absence of appropriate written instructions
from the Seller, the Purchaser shall have no obligation to invest or direct the
investment of funds in such Purchase Price Security Deposit Account. All income
and gain realized from the investment of funds deposited in any Purchase Price
Security Deposit Account shall be for the benefit of the Seller and shall be
withdrawn by the Purchaser or its designee and remitted to the Seller on each
Master Servicer Remittance Date (net of any losses incurred and any deposits
required to be made by the Seller as contemplated by the second proviso to the
prior paragraph), and the Seller shall remit to the Purchaser from the Seller's
own funds for deposit into such Purchase Price Security Deposit Account the
amount of any realized losses (net of realized gains) in respect of such
Permitted Investments immediately upon realization of such net losses and
receipt of written notice thereof from the Purchaser; provided that the Seller
shall not be required to make any such deposit for any realized loss which is
incurred solely as a result of the insolvency of the federal or state depository
institution or trust company that holds such Purchase Price Security Deposit
Account. Neither the Purchaser nor any of its designees shall have any
responsibility or liability with respect to the investment directions of the
Seller, the investment of funds in any Purchase Price Security Deposit Account
in Permitted Investments or any losses resulting therefrom.
If one or more (but not all) of the Mortgage Loans
constituting a Cross-Collateralized Group are to be repurchased or replaced by
the Seller as contemplated by this Section 5(a), then, prior to the subject
repurchase or substitution, the Purchaser or its designee shall use its best
efforts, subject to the terms of such Mortgage Loans, to prepare and, to the
extent necessary and appropriate, have
executed by the related Borrower and record, such documentation as may be
necessary to terminate the cross-collateralization between the Mortgage Loans in
such Cross-Collateralized Group that are to be repurchased or replaced, on the
one hand, and the remaining Mortgage Loans therein, on the other hand, such that
those two groups of Mortgage Loans are each secured only by the Mortgaged
Properties identified in the Mortgage Loan Schedule as directly corresponding
thereto (as to each such group, the "Primary Real Property Collateral");
provided that, if the affected Cross-Collateralized Group is then subject to the
Pooling and Servicing Agreement, then no such termination shall be affected
unless and until the Trustee and the applicable Master Servicer shall have
received from the Seller (i) an Opinion of Counsel from independent counsel to
the effect that such termination will not cause an Adverse REMIC Event to occur
with respect to any REMIC Pool or an Adverse Grantor Trust Event with respect to
either Grantor Trust Pool and (ii) written confirmation from each Rating Agency
that such termination will not cause an Adverse Rating Event to occur with
respect to any Class of Rated Certificates; and provided, further, that the
Seller may, at its option, purchase the entire subject Cross-Collateralized
Group in lieu of terminating the cross-collateralization. All costs and expenses
incurred by the Purchaser and its servicing agents pursuant to this paragraph
shall be included in the calculation of Purchase Price for the Mortgage Loan(s)
to be repurchased or replaced.
If the cross-collateralization of any Cross-Collateralized
Group of Mortgage Loans cannot be terminated as contemplated by the prior
paragraph for any reason (including, but not limited to, the Seller's failure to
satisfy any of the conditions set forth in the proviso to the first sentence of
the prior paragraph), if the Seller has not elected to purchase the entire
affected Cross-Collateralized Group, and if such Cross-Collateralized Group is
then subject to the Pooling and Servicing Agreement, then, to the extent that
the Seller is required to repurchase or replace any Mortgage Loan in that
Cross-Collateralized Group in the manner prescribed above while the Trust
continues to hold any other Mortgage Loan in that Cross-Collateralized Group,
the Trustee, on behalf of the Trust, and the Seller each hereby agrees to
forbear from enforcing any remedies against the other's Primary Real Property
Collateral but may exercise remedies against the Primary Real Property
Collateral securing the Mortgage Loans in that Cross-Collateralized Group held
by it; provided that the Trustee and the applicable Master Servicer shall have
received from the Seller an Opinion of Counsel from independent counsel to the
effect that (i) the exercise of remedies by the Seller, on the one hand, or the
Trust, on the other hand, with respect to the Primary Real Property Collateral
securing the respective Mortgage Loan(s) in such Cross-Collateralized Group held
by such party would not materially and adversely affect the rights of the other
such party to proceed against the Primary Real Property Collateral for the
respective Mortgage Loan(s) in such Cross-Collateralized Group held by such
other party and (ii) the foregoing arrangement would not result in an Adverse
REMIC Event with respect to any REMIC Pool or an Adverse Grantor Trust Event
with respect to any Grantor Trust Pool. Any reserve or other cash collateral or
letters of credit securing the subject Cross-Collateralized Group shall be
allocated between the Mortgage Loans therein held by the Seller, on the one
hand, and the Trust, on the other hand, in accordance with the related Mortgage
Loan documents, or otherwise on a pro rata basis based upon the outstanding
principal balances of their respective Mortgage Loans in such
Cross-Collateralized Group. All other terms of the Mortgage Loans in such
Cross-Collateralized Group shall remain in full force and effect, without any
modification thereof. The Borrowers under the respective Cross-Collateralized
Groups of Mortgage Loans are intended third-party beneficiaries of the provision
set forth in this paragraph. The provisions of this paragraph may not be
modified with respect to any Mortgage Loan in a Cross-Collateralized Group
without the related Borrower's consent.
If the cross-collateralization of any Cross-Collateralized
Group of Mortgage Loans cannot be terminated as contemplated by the second
preceding paragraph for any reason (including, but not limited to, the Seller's
failure to satisfy any of the conditions set forth in the proviso to the first
sentence of the second preceding paragraph) and the forbearance arrangement in
respect of such Cross-Collateralized Group cannot be effected as contemplated by
the preceding paragraph for any reason (including, but not limited to, the
Seller's failure to satisfy any of the conditions set forth in the proviso to
the first sentence of the prior paragraph) then the entire Cross-Collateralized
Group shall be repurchased or replaced if the subject Material Breach or
Material Document Defect, as the case may be, is not remedied in all material
respects by the end of the applicable Initial Resolution Period and any
applicable Resolution Extension Period.
Whenever one or more mortgage loans are substituted by the
Seller for a Defective Mortgage Loan as contemplated by this Section 5(a), the
Seller shall (i) deliver the related Mortgage File for each such substitute
mortgage loan to the Purchaser or its designee (which designee, unless otherwise
stated, is the Trustee), (ii) certify that such substitute mortgage loan
satisfies or such substitute mortgage loans satisfy, as the case may be, all of
the requirements of the definition of "Qualifying Substitute Mortgage Loan" set
forth in the Pooling and Servicing Agreement and (iii) send such certification
to the Purchaser or its designee. No mortgage loan may be substituted for a
Defective Mortgage Loan as contemplated by this Section 5(a) if the Defective
Mortgage Loan to be replaced was itself a Replacement Mortgage Loan, in which
case, absent cure of the relevant Material Breach or Material Document Defect,
the Defective Mortgage Loan will be required to be repurchased as contemplated
hereby. Monthly Payments due with respect to each Replacement Mortgage Loan (if
any) after the related date of substitution, and Monthly Payments due with
respect to each Defective Mortgage Loan (if any) after the Cut-off Date (or, in
the case of a Replacement Mortgage Loan, after the date on which it is added to
the Trust Fund) and on or prior to the related date of repurchase or
replacement, shall belong to the Purchaser. Monthly Payments due with respect to
each Replacement Mortgage Loan (if any) on or prior to the related date of
substitution, and Monthly Payments due with respect to each Defective Mortgage
Loan (if any) after the related date of repurchase or replacement, shall belong
to the Seller.
If any Defective Mortgage Loan is to be repurchased or
replaced as contemplated by this Section 5(a), the Seller shall amend the
Mortgage Loan Schedule to reflect the removal of the Defective Mortgage Loan
and, if applicable, the substitution of the related Replacement Mortgage Loan(s)
and shall forward such amended schedule to the Purchaser.
(b) It shall be a condition to any repurchase or replacement
of a Defective Mortgage Loan by the Seller pursuant to Section 5(a) that the
Purchaser (which shall include the Trustee) shall have executed and delivered
such instruments of transfer or assignment then presented to it by the Seller,
in each case without recourse, as shall be necessary to vest in the Seller the
legal and beneficial ownership of such Defective Mortgage Loan (including any
property acquired in respect thereof or proceeds of any insurance policy with
respect thereto), to the extent that such ownership interest was transferred to
the Purchaser hereunder.
(c) If, on or after May 13, 2003, the Seller receives notice
of a Material Document Defect with respect to any Mortgage Loan, which Material
Document Defect constitutes a Recording Omission, and if such Mortgage Loan is
still subject to the Pooling and Servicing Agreement, then the Seller, with the
consent of the Controlling Class Representative, which consent may be granted or
withheld in its sole discretion, in lieu of repurchasing or replacing such
Mortgage Loan (as and to the extent contemplated by Section 5(a) above), but in
no event later than such repurchase would have to have been completed, establish
a Recording Omission Credit or a Recording Omission Reserve with the applicable
Master Servicer. In furtherance of the preceding sentence, the Purchaser or its
designee shall establish one or more accounts (individually and collectively,
the "Special Reserve Account"), each of which shall be an Eligible Account, and
the Purchaser or its designee shall deposit any Recording Omission Reserve into
the Special Reserve Account within one Business Day of receipt. The Seller may
direct the Purchaser or its designee to invest or cause the investment of the
funds deposited in the Special Reserve Account in one or more Permitted
Investments that bear interest or are sold at a discount and that mature, unless
payable on demand, no later than the Business Day prior to the next Master
Servicer Remittance Date. The Purchaser or its designee shall act upon the
written instructions of the Seller with respect to the investment of funds in
the Special Reserve Account in such Permitted Investments, provided that in the
absence of appropriate written instructions from the Seller, the Purchaser shall
have no obligation to invest or direct the investment of funds in such Special
Reserve Account. All income and gain realized from the investment of funds
deposited in such Special Reserve Account shall be for the benefit of the Seller
and shall be withdrawn by the Purchaser or its designee and remitted to the
Seller on each Master Servicer Remittance Date (net of any losses incurred), and
the Seller shall remit to the Purchaser from the Seller's own funds for deposit
into such Special Reserve Account the amount of any realized losses (net of
realized gains) in respect of such Permitted Investments immediately upon
realization of such net losses and receipt of written notice thereof from the
Purchaser; provided that the Seller shall not be required to make any such
deposit for any realized loss which is incurred solely as a result of the
insolvency of the federal or state depository institution or trust company that
holds such Special Reserve Account. Neither the Purchaser nor any of its
designees shall have any responsibility or liability with respect to the
investment directions of the Seller, the investment of funds in the Special
Reserve Account in Permitted Investments or any losses resulting therefrom. A
Recording Omission Credit shall (i) entitle the Purchaser or its designee to
draw upon the Recording Omission Credit on behalf of the Purchaser upon
presentation of only a sight draft or other written demand for payment, (ii)
permit multiple draws by the Purchaser or its designee, and (iii) be issued by
such issuer and containing such other terms as the Purchaser or its designee may
reasonably require to make such Recording Omission Credit reasonably equivalent
security to a Recording Omission Reserve in the same amount. Once a Recording
Omission Reserve or Recording Omission Credit is established with respect to any
Mortgage Loan, the Purchaser or its designee shall, from time to time, withdraw
funds from the related Special Reserve Account or draw upon the related
Recording Omission Credit, as the case may be, and apply the proceeds thereof to
pay the losses or expenses directly incurred by the Purchaser or its designee as
a result of a Recording Omission. The Recording Omission Reserve or Recording
Omission Credit or any unused balance thereof with respect to any Mortgage Loan
will be released to the Seller by the Purchaser upon the earlier of the Seller's
cure of all Recording Omissions with respect to such Mortgage Loan (provided
that the Purchaser has been reimbursed with respect to all losses and expenses
relating to Recording Omissions with respect to such Mortgage Loan) and such
Mortgage Loan's no longer being a part of the Trust Fund under the Pooling and
Servicing Agreement.
(d) It is understood and agreed that the obligations of the
Seller set forth in this Section 5 to cure a Material Breach or a Material
Document Defect, repurchase or replace the related Defective Mortgage Loan(s)
or establish a Recording Omission Credit or a Recording Omission Reserve with
respect to the related Defective Mortgage Loan(s), constitute the sole remedies
available to the
Purchaser, the Certificateholders or the Trustee on behalf of the
Certificateholders with respect to a Breach or Document Defect in respect of any
Mortgage Loan.
(e) If the 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 the Purchaser or its
assignee or (iii) to replace such Mortgage Loan with a Qualifying Substitute
Mortgage Loan, each in accordance with the foregoing provisions of this Section
5, then (provided that (i) the Mortgage Loan is then subject to the Pooling and
Servicing Agreement, (ii) the applicable Initial Resolution Period and any
applicable Resolution Extension Period has expired and (iii) the Mortgage Loan
is then in default and is then a Specially Serviced Mortgage Loan) the
applicable 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 the terms of the Pooling and Servicing
Agreement, while pursuing the repurchase claim, and such action shall not be a
defense to the repurchase claim or alter the applicable Purchase Price.
If any REO Property in respect of any Mortgage Loan is subject
to the Pooling and Servicing Agreement, then the Seller shall be notified
promptly and in writing by the applicable Special Servicer of any offer that it
receives to purchase such REO Property. Upon the receipt of such notice by the
Seller, the Seller shall then have the right to repurchase such REO Property
from the Trust at a purchase price equal to the amount of such offer. The Seller
shall have three (3) Business Days to purchase such REO Property from the date
that it was notified of such offer. The applicable Special Servicer shall be
obligated to provide the Seller with any appraisal or other third-party reports
relating to such REO Property within its possession to enable the related
Mortgage Loan Seller to evaluate such REO Property. Any sale of a Mortgage Loan,
or foreclosure upon such Mortgage Loan and sale of any related REO Property, to
a Person other than the Seller shall be (i) without recourse of any kind (either
expressed or implied) by such Person against the Seller and (ii) without
representation or warranty of any kind (either expressed or implied) by the
Seller to or for the benefit of such Person.
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 subject Mortgage Loan or REO Property) shall not prejudice any claim of
the Trust against the Seller for repurchase of the subject Mortgage Loan or REO
Property. The provisions of this Section 5 regarding remedies against the Seller
for a Material Breach or Material Document Defect with respect to any Mortgage
Loan shall also apply to the related REO Property.
If the Seller fails to correct or cure the Material Document
Defect or Material Breach or purchase the subject REO Property, then the
provisions above regarding notice of offers related to such REO Property and the
Seller's right to purchase such REO Property shall apply. If a court of
competent jurisdiction issues a final order that the Seller is or was obligated
to repurchase the related Mortgage Loan or REO Property or the Seller otherwise
accepts liability, then, after the expiration of any applicable appeal period,
but in no event later than the termination of the Trust pursuant to the Pooling
and Servicing Agreement, the Seller will be obligated to pay to the Trust the
amount, if any, by which the applicable Purchase Price exceeds any Liquidation
Proceeds received upon such liquidation (including those arising from any sale
to the Seller); provided that the prevailing party in such action shall be
entitled to recover all costs, fees and expenses (including reasonable
attorneys' fees) related thereto.
SECTION 6. Closing. The closing of the sale of the Mortgage
Loans (the "Closing") shall be held at the offices of Sidley Xxxxxx Xxxxx &
Xxxx, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 at 10:00 a.m., New York City
time, on the Closing Date.
The Closing shall be subject to each of the following
conditions:
(i) all of the representations and warranties of the
Seller made pursuant to Section 4 of this Agreement
shall be true and correct in all material respects as
of the Closing Date;
(ii) all documents specified in Section 7 of this
Agreement (the "Closing Documents"), in such forms as
are agreed upon and reasonably acceptable to the
Purchaser and, in the case of the Pooling and
Servicing Agreement (insofar as such Agreement
affects to obligations of the Seller hereunder), to
the Seller, shall be duly executed and delivered by
all signatories as required pursuant to the
respective terms thereof;
(iii) the Seller shall have delivered and released to the
Purchaser or its designee, all documents, funds and
other assets required to be delivered thereto
pursuant to Section 2 of this Agreement;
(iv) the result of any examination of the Mortgage Files
for, and any other documents and records relating to,
the Mortgage Loans performed by or on behalf of the
Purchaser pursuant to Section 3 hereof shall be
satisfactory to the Purchaser in its reasonable
determination;
(v) all other terms and conditions of this Agreement
required to be complied with on or before the Closing
Date shall have been complied with in all material
respects, and the Seller shall have the ability to
comply with all terms and conditions and perform all
duties and obligations required to be complied with
or performed after the Closing Date;
(vi) the Seller shall have received the consideration for
the Mortgage Loans, as contemplated by Section 1;
(vii) the Seller shall have paid all fees and expenses
payable by it to the Purchaser or otherwise pursuant
to this Agreement; and
(viii) neither the Underwriting Agreement nor the
Certificate Purchase Agreement shall have been
terminated in accordance with its terms.
Both parties agree to use their commercially reasonable best
efforts to perform their respective obligations hereunder in a manner that will
enable the Purchaser to purchase the Mortgage Loans on the Closing Date.
SECTION 7. Closing Documents. The Closing Documents shall consist of the
following:
(i) this Agreement, duly executed by the Purchaser and
the Seller;
(ii) each of the Pooling and Servicing Agreement and the
Indemnification Agreement, duly executed by the
respective parties thereto;
(iii) an Officer's Certificate substantially in the form of
Exhibit D-1A hereto, executed by the Secretary or an
assistant secretary of the Seller, in his or her
individual capacity, and dated the Closing Date, and
upon which CSFB Mortgage Securities, CSFB
Corporation, the other Underwriters and the Rating
Agencies (collectively, for purposes of this Section
7, the "Interested Parties") may rely, attaching
thereto as exhibits (A) the resolutions of the board
of directors of the Seller authorizing the Seller's
entering into the transactions contemplated by this
Agreement, and (B) the organizational documents of
the Seller;
(iv) a Certificate of the Seller substantially in the form
of Exhibit D-1B hereto, executed by an executive
officer of the Seller on the Seller's behalf and
dated the Closing Date, and upon which the Interested
Parties may rely;
(v) written opinions of Xxxxxxxx Xxxxxxxxx Xxxxxx
Aronsohn & Xxxxxx LLP, special counsel for the
Seller, dated the Closing Date and addressed to the
Interested Parties and the respective parties to the
Pooling and Servicing Agreement, which opinions shall
be substantially in the form of Exhibit D-2A and
Exhibit D-2B, respectively, hereto;
(vi) a letter from Xxxxxxxx Xxxxxxxxx Xxxxxx Xxxxxxxx &
Xxxxxx LLP, special counsel for the Seller, dated the
Closing Date and addressed to CSFB Mortgage
Securities, CSFB Corporation and the other
Underwriters, which letter shall be substantially in
the form of Exhibit D-2C hereto;
(vii) one or more comfort letters from Xxxxxx Xxxxxxxx LLP,
certified public accountants, dated the date of any
preliminary Prospectus Supplement and of the
Prospectus Supplement, respectively, and addressed
to, and in form and substance acceptable to, CSFB
Mortgage Securities, CSFB Corporation, the other
Underwriters and their respective counsel, stating in
effect that, using the assumptions and methodology
used by CSFB Mortgage Securities, all of which shall
be described in such letters, they have recalculated
such numbers and percentages relating to the Mortgage
Loans set forth in any preliminary Prospectus
Supplement and the Prospectus Supplement, compared
the results of their calculations to the
corresponding items in any preliminary Prospectus
Supplement and the Prospectus Supplement,
respectively, and found each such number and
percentage set forth in any preliminary Prospectus
Supplement and the Prospectus Supplement,
respectively, to be in agreement with the results of
such calculations (the Purchaser acknowledges receipt
and satisfactory review of such letter); and
(viii) such further certificates, opinions and documents as
the Purchaser may reasonably request prior to the
Closing Date or any Rating Agency may require and in
a form reasonably acceptable to the Purchaser and the
Seller.
SECTION 8. Costs. Whether or not this Agreement is terminated,
the costs and expenses incurred in connection with the transactions herein
contemplated shall be allocated as follows: (i) all out-of-pocket and/or
internally allocated costs and expenses incurred by the Seller in connection
with the transactions herein contemplated, including, without limitation, the
fees and disbursements of its counsel, together with all other due diligence and
accounting costs and expenses incurred by the Seller or its affiliates and
relating to the Mortgage Loans, shall be borne by the Seller; and (ii) all other
costs and expenses incurred in connection with the transactions herein
contemplated including, without limitation, any and all underwriting and
placement fees shall be borne by CSFB Mortgage Securities,
Column Financial, Inc. and KeyBank National Association, in such proportions as
they shall mutually agree.
SECTION 9. Notices. All demands, notices and communications
hereunder shall be in writing and shall be deemed to have been duly given if
personally delivered to or mailed, by registered mail, postage prepaid, by
overnight mail or courier service, or transmitted by facsimile and confirmed by
similar mailed writing, if to the Purchaser, addressed to the Purchaser at 00
Xxxxxxx Xxxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxxx Xxxxxxx,
or such other address as may be designated by the Purchaser to the Seller in
writing, or, if to the Seller, addressed to the Seller at 0000 Xxx Xxxxxx, X.X.,
Xxxxxxxxxx, X.X. 00000, Attention: Xxxxxx Xxxxxxxx, or such other address as may
be designated by the Seller to the Purchaser in writing..
SECTION 10. Miscellaneous. Neither this Agreement nor any term
or provision hereof may be changed, waived, discharged or terminated except by a
writing signed by a duly authorized officer of the party against whom
enforcement of such change, waiver, discharge or termination is sought to be
enforced. This Agreement may be executed in any number of counterparts, each of
which shall for all purposes be deemed to be an original and all of which shall
together constitute but one and the same instrument. This Agreement will inure
to the benefit of and be binding upon the parties hereto and their respective
successors and assigns, and no other person will have any right or obligation
hereunder. Notwithstanding any contrary provision of this Agreement or the
Pooling and Servicing Agreement, the Purchaser shall not consent to any
amendment of the Pooling and Servicing Agreement which will increase the
obligations of, or otherwise adversely affect, the Seller, without the consent
of the Seller.
SECTION 11. Characterization. The parties hereto agree that it
is their express intent that the conveyance contemplated by this Agreement be,
and be treated for all purposes as, a sale by the Seller of all the Seller's
right, title and interest in and to the Mortgage Loans. The parties hereto
further agree that it is not their intention that such conveyance be a pledge of
the Mortgage Loans by the Seller to secure a debt or other obligation of the
Seller. However, in the event that, notwithstanding the intent of the parties,
the Mortgage Loans are held to continue to be property of the Seller, then: (a)
this Agreement shall be deemed to be a security agreement under applicable law;
(b) the transfer of the Mortgage Loans provided for herein shall be deemed to be
a grant by the Seller to the Purchaser of a first priority security interest in
all of the Seller's right, title and interest in and to the Mortgage Loans and
all amounts payable to the holder(s) of the Mortgage Loans in accordance with
the terms thereof (other than scheduled payments of interest and principal due
on or before the Cut-off Date) and all proceeds of the conversion, voluntary or
involuntary, of the foregoing into cash, instruments, securities or other
property; (c) the assignment by CSFB Mortgage Securities to the Trustee of its
interests in the Mortgage Loans as contemplated by Section 16 hereof shall be
deemed to be an assignment of any security interest created hereunder; (d) the
possession by the Purchaser of the related Mortgage Notes and such other items
of property as constitute instruments, money, negotiable documents or chattel
paper shall be deemed to be "possession by the secured party" for purposes of
perfecting the security interest under applicable law; and (e) notifications to,
and acknowledgments, receipts or confirmations from, persons or entities holding
such property, shall be deemed notifications to, or acknowledgments, receipts or
confirmations from, bailees or agents (as applicable) of the Purchaser for the
purpose of perfecting such security interest under applicable law. The Seller
and the Purchaser shall, to the extent consistent with this Agreement, take such
actions, including, without limitation, the filing of UCC financing statements,
as may be necessary to ensure that, if this Agreement were deemed to create a
security interest in the Mortgage Loans, such security interest would be a
perfected security interest of first priority under applicable law and will be
maintained as such throughout the term of this Agreement and the Pooling and
Servicing Agreement.
SECTION 12. Representations, Warranties and Agreements to
Survive Delivery. All representations, warranties and agreements contained in
this Agreement, incorporated herein by reference or contained in the
certificates of officers of the Seller delivered pursuant hereto, shall remain
operative and in full force and effect and shall survive delivery of the
Mortgage Loans by the Seller to the Purchaser, notwithstanding any restrictive
or qualified endorsement or assignment in respect of any Mortgage Loan.
SECTION 13. Severability of Provisions. Any part, provision,
representation, warranty or covenant of this Agreement that is prohibited or 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 is held to be void or unenforceable in any
particular jurisdiction shall, as to such jurisdiction, be ineffective to the
extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
particular jurisdiction shall not invalidate or render unenforceable such
provision in any other jurisdiction. To the extent permitted by applicable law,
the parties hereto waive any provision of law which prohibits or renders void or
unenforceable any provision hereof.
SECTION 14. GOVERNING LAW; CONSENT TO JURISDICTION. THIS
AGREEMENT WILL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK, APPLICABLE TO AGREEMENTS NEGOTIATED, MADE AND TO BE PERFORMED
ENTIRELY IN SAID STATE. TO THE FULLEST EXTENT PERMITTED UNDER APPLICABLE LAW,
THE SELLER AND THE PURCHASER EACH HEREBY IRREVOCABLY (I) SUBMITS TO THE
JURISDICTION OF ANY NEW YORK STATE AND FEDERAL COURTS SITTING IN NEW YORK CITY
WITH RESPECT TO MATTERS ARISING OUT OF OR RELATING TO THIS AGREEMENT; (II)
AGREES THAT ALL CLAIMS WITH RESPECT TO SUCH ACTION OR PROCEEDING MAY BE HEARD
AND DETERMINED IN SUCH NEW YORK STATE OR FEDERAL COURTS; (III) WAIVES, TO THE
FULLEST POSSIBLE EXTENT, THE DEFENSE OF AN INCONVENIENT FORUM; AND (IV) AGREES
THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND
MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER
MANNER PROVIDED BY LAW.
SECTION 15. Further Assurances. The Seller and the Purchaser
agree to execute and deliver such instruments and take such further actions as
the other party may, from time to time, reasonably request in order to
effectuate the purposes and to carry out the terms of this Agreement.
SECTION 16. Successors and Assigns. The rights and obligations
of the Seller under this Agreement shall not be assigned by the Seller without
the prior written consent of the Purchaser, except that any person into which
the Seller may be merged or consolidated, or any corporation resulting from any
merger, conversion or consolidation to which the Seller is a party, or any
person succeeding to all or substantially all of the business of the Seller,
shall be the successor to the Seller hereunder. In connection with its transfer
of the Mortgage Loans to the Trust as contemplated by the recitals hereto,
CSFB Mortgage Securities is expressly authorized to assign its rights and
obligations under this Agreement, in whole or in part, to the Trustee for the
benefit of the registered holders and beneficial owners of the Certificates. To
the extent of any such assignment, the Trustee, for the benefit of the
registered holders and beneficial owners of the Certificates, shall be the
Purchaser hereunder. In connection with the transfer of any Mortgage Loan by the
Trust as contemplated by the terms of the Pooling and Servicing Agreement, the
Trustee, for the benefit of the registered holders and beneficial owners of the
Certificates, is expressly authorized to assign its rights and obligations under
this Agreement, in whole or in part, to the transferee of such Mortgage Loan. To
the extent of any such assignment, such transferee shall be the Purchaser
hereunder (but solely with respect to such Mortgage Loan that was transferred to
it). Subject to the foregoing, this Agreement shall bind and inure to the
benefit of and be enforceable by the Seller and the Purchaser, and their
respective successors and permitted assigns.
SECTION 17. Information. The Seller shall provide the
Purchaser with such information about the Seller, the Mortgage Loans and the
Seller's underwriting and servicing procedures as is (i) customary in commercial
mortgage loan securitization transactions, (ii) required by a Rating Agency or a
governmental agency or body or (iii) reasonably requested by the Purchaser for
use in a public or private disclosure document.
SECTION 18. Entire Agreement. Except as otherwise expressly
contemplated hereby, this Agreement constitutes the entire agreement and
understanding of the parties with respect to the matters addressed herein, and
this Agreement supersedes any prior agreements and/or understandings, written or
oral, with respect to such matters.
* * *
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the Seller and the Purchaser have caused
this Agreement to be duly executed by their respective officers as of the day
and year first above written.
NATIONAL CONSUMER COOPERATIVE BANK
By:
------------------------------------
Name:
Title:
CREDIT SUISSE FIRST BOSTON MORTGAGE
SECURITIES CORP.
By:
------------------------------------
Name:
Title:
EXHIBIT A
MORTGAGE LOAN SCHEDULE
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES SERIES 2001-CKN5
Mortgage Cut-off
Zip Mortgage Loan Fee/ Orginal Balance
# Property Name Address City State Code Originator Seller Leasehold Balance (2)
- ------------- ------- ---- ----- ----- ---------- -------- --------- ------- -----------
1 Ocean Towers 000 Xxxxx Xxxxx XX 00000 XXX XXX Fee $70,000,000 $69,935,028
Xxxxxx Xxxxxx
00 Minneola, LLC 00 Xxxxx Xxx Xxxx XX 00000 NCB NCB Fee $4,500,000 $4,493,316
Xxxxxx
00 000 Xxxxxxxxx 000 Xxxxxxxxx Xxx Xxxx XX 00000 NCB NCB Fee $3,000,000 $2,889,989
Xxxxxx Xxxxxx xxx
00-00 Xxxxxxx
Xxxxxx
90 Sprain 720-740 Yonkers NY 10710 NCB NCB Fee $2,800,000 $2,780,572
Associates Xxxxxxxx Xxxx
00 2 Commerce 0 Xxxxxxxx Xxxxxxx XX 00000 NCB NCB Fee $2,625,000 $2,620,324
Xxxxx Xxxxx
000 000 Xxxx Xxx 000 Xxxx Xxx Xxx Xxxx XX 00000 NCB NCB Fee $2,000,000 $1,992,205
Avenue Avenue
Corporation
116 XxXxxxx 26006 Xxxxxxx XX 00000 NCB NCB Fee $2,000,000 $1,707,227
Hardware Xxxxxxxxxx Viejo
Parkway
120 Xx Xxxxx 00000 Xxx Xxx Xxxx XX 00000 XXX XXX Fee $1,700,000 $1,622,030
Family Trust Obispo Street Capistrano
143 4345 Xxxxxxx 0000 Xxxxxxx Xxxxx XX 00000 NCB NCB Fee $1,000,000 $993,061
Xxxxxx Xxxxxx
000 Foursome 17-21 Rich Xxxxx XX 00000 NCB NCB Fee $850,000 $805,850
Associates, LLC Avenue Xxxxxx
175 Seagull Garden 000 Xxxxxx Xxxxxxxxxxx XX 00000 NCB NCB Fee $385,000 $377,972
Apartment Street
Owners
Corporation
000 Xxxx 00 000 Xxxx 00xx Xxx Xxxx XX 00000 NCB NCB Fee $330,000 $329,454
Tenants Realty Street
Corporation
177 City Studios, 000 Xxxxxxxxx Xxx Xxxx XX 00000 NCB NCB Fee $300,000 $293,100
Inc. Xxxxxx
000 000 0xx Xxxxxx 000 0xx Xxxxxx Xxxxxxxx XX 00000 NCB NCB Fee $280,000 $277,391
Corporation
179 219 Clinton 000 Xxxxxxx Xxxxxxxx XX 00000 NCB NCB Fee $275,000 $267,635
Xxxxxx Xxxxxxx Xxxxxx
Xxxxxxxxxxx
000 107-38 Owners 000 Xxxx 00xx Xxx Xxxx XX 00000 NCB NCB Fee $260,000 $259,213
Corporation Street
181 226 West 11th 000 Xxxx 00xx Xxx Xxxx XX 00000 NCB NCB Fee $258,000 $257,070
Owners Street
Corporation
183 Main Xxxxx 000-000 Xxxxx Xxx Xxxx XX 00000 NCB NCB Fee $224,000 $218,985
Owners Street
Corporation
186 286 Pacific 000 Xxxxxxx Xxxxxxxx XX 00000 NCB NCB Fee $195,000 $194,229
Street Owners Street
Corporation
187 128 Sixth 000 Xxxxx Xxxxxxxx XX 00000 NCB NCB Fee $165,000 $164,375
Avenue Housing Avenue
Corporation
188 264 President 000 Xxxxxxxxx Xxxxxxxx XX 00000 NCB NCB Fee $155,000 $152,616
Apartment Street
Corporation
189 000 Xxxxx 000 Xxxxx Xxxxxxxx XX 00000 NCB NCB Fee $150,000 $149,751
Housing Street
Corporation
190 659 XxXxxx 000 XxXxxx Xxxxxxxx XX 00000 NCB NCB Fee $130,000 $129,504
Housing Street
Corporation
191 279 Prospect 000 Xxxxxxxx Xxxxxxxx XX 00000 NCB NCB Fee $120,000 $116,029
Housing Place
Corporation
192 397 7th 000 0xx Xxxxxx Xxxxxxxx XX 00000 NCB NCB Fee $105,000 $103,039
Housing
Corporation
194 90 Sterling 90 Sterling Xxxxxxxx XX 00000 NCB NCB Fee $94,000 $92,552
Place Owners Place
Corporation
195 193 Xxxxx 000 Xxxxxxx Xxxxxxxx XX 00000 NCB NCB Fee $90,000 $88,797
Housing Street
Corporation
A-1
Initial Orig Rem. Interest Servicing
Interest Orig Rem Term to Term to Calculation First and
Only Amort. Amort. Maturity Maturity Interest (30/360/ Monthly Payment Defeasance Trustee
# Term Term Term (3) (3) Rate Actual/360) Payment Date ARD(4) Defeasance Provision Fees
- ---- ---- ---- -------- -------- -------- ----------- ------- ---------- ------ ---------- ---------- --------
1 0 480 475 120 115 7.7100% Actual/360 471,550 07/11/2001 N/A Yes Lock/29_Def/ 0.1025%
87_0%/4
57 0 360 358 120 118 6.9000% Actual/360 29,637 10/01/2001 N/A Yes Lock/48_Def/ 0.1025%
68_0%/4
88 0 240 218 120 98 8.6000% Actual/360 26,453 02/01/2000 N/A Yes Lock/46_Def/ 0.1025%
70_0%/4
90 0 360 350 120 110 7.9100% Actual/360 20,584 02/01/2001 N/A Yes Lock/47_Def/ 0.1025%
69_0%/4
95 0 360 357 120 117 7.5800% Actual/360 18,498 09/01/2001 N/A Yes Lock/45_Def/ 0.1025%
71_0%/4
110 0 240 238 120 118 6.9000% 30/360 15,386 10/01/2001 N/A Yes Lock/48_Def/ 0.1025%
68_0%/4
116 0 180 135 180 135 8.0200% Actual/360 19,136 03/01/1998 N/A No N/A 0.1025%
120 0 300 260 120 80 7.6700% Actual/360 12,751 08/01/1998 N/A No N/A 0.1025%
143 0 360 350 120 110 7.9100% Actual/360 7,352 02/01/2001 N/A Yes Lock/47_Def/ 0.1025%
69_0%/4
155 0 300 259 120 79 7.4900% Actual/360 6,334 07/01/1998 N/A No N/A 0.1025%
175 0 180 174 180 174 7.3000% Actual/360 3,547 06/01/2001 N/A Yes Lock/48_Def/ 0.1025%
128_0%/4
176 0 360 358 120 118 6.9700% 30/360 2,189 10/01/2001 N/A Yes Lock/48_Def/ 0.1025%
68_0%/4
177 0 120 116 120 116 7.2500% 30/360 3,522 08/01/2001 N/A Yes Lock/48_Def/ 0.1025%
68_0%/4
178 0 180 177 180 177 7.2500% 30/360 2,556 09/01/2001 N/A Yes Lock/48_Def/ 0.1025%
128_0%/4
179 0 180 171 180 171 7.9700% 30/360 2,623 03/01/2001 N/A Yes Lock/48_Def/ 0.1025%
128_0%/4
180 0 360 356 120 116 7.4500% 30/360 1,809 08/01/2001 N/A Yes Lock/48_Def/ 0.1025%
68_0%/4
181 0 300 297 120 117 7.2100% 30/360 1,858 09/01/2001 N/A Yes Lock/48_Def/ 0.1025%
68_0%/4
183 0 120 116 120 116 7.7500% 30/360 2,688 08/01/2001 N/A Yes Lock/48_Def/ 0.1025%
68_0%/4
186 0 360 355 120 115 7.2400% 30/360 1,329 07/01/2001 N/A Yes Lock/48_Def/ 0.1025%
68_0%/4
187 0 360 355 120 115 7.4600% 30/360 1,149 07/01/2001 N/A Yes Lock/48_Def/ 0.1025%
68_0%/4
188 0 180 175 180 175 7.4300% 30/360 1,431 07/01/2001 N/A Yes Lock/48_Def/ 0.1025%
128_0%/4
189 0 360 358 120 118 6.9600% 30/360 994 10/01/2001 N/A Yes Lock/48_Def/ 0.1025%
68_0%/4
190 0 360 355 120 115 7.4200% 30/360 902 07/01/2001 N/A Yes Lock/48_Def/ 0.1025%
68_0%/4
191 0 180 169 180 169 7.9200% 30/360 1,141 01/01/2001 N/A Yes Lock/48_Def/ 0.1025%
128_0%/4
192 0 180 174 180 174 7.3300% 30/360 963 06/01/2001 N/A Yes Lock/48_Def/ 0.1025%
128_0%/4
194 0 180 175 180 175 7.4100% 30/360 867 07/01/2001 N/A Yes Lock/48_Def/ 0.1025%
128_0%/4
195 0 180 175 180 175 8.7300% Actual/360 905 07/01/2001 N/A Yes Lock/48_Def/ 0.1025%
128_0%/4
X-0
XXXXXXX X-0
REPRESENTATIONS AND WARRANTIES WITH RESPECT TO THE SELLER
The Seller hereby represents and warrants that, as of the Closing Date:
1. The Seller is a corporation duly organized, validly existing and in
good standing under the laws of the United States.
2. The execution and delivery by the Seller of, and the performance by
the Seller under, this Agreement, the execution (including, without limitation,
by facsimile or machine signature) and delivery of any and all documents
contemplated by this Agreement, including, without limitation, endorsements of
Mortgage Notes, and the consummation by the Seller of the transactions herein
contemplated, will not: (a) violate the Seller's organizational documents; or
(b) constitute a default (or an event which, with notice or lapse of time, or
both, would constitute a default) under, or result in the breach of, any
indenture, agreement or other instrument to which the Seller is a party or by
which it is bound or which is applicable to it or any of its assets, which
default or breach, in the Seller's good faith and reasonable judgment, is likely
to affect materially and adversely either the ability of the Seller to perform
its obligations under this Agreement or the financial condition of the Seller.
3. The Seller has full power and authority to enter into and perform
under this Agreement, has duly authorized the execution, delivery and
performance of this Agreement, and has duly executed and delivered this
Agreement.
4. The Seller has the full right, power and authority to sell, assign,
transfer, set over and convey the Mortgage Loans (and, in the event that the
related transaction is deemed to constitute a loan secured by all or part of the
Mortgage Loans, to pledge the Mortgage Loans) in accordance with, and under the
conditions set forth in, this Agreement.
5. Assuming due authorization, execution and delivery hereof by the
Purchaser, this Agreement constitutes a valid, legal and binding obligation of
the Seller, enforceable against the Seller in accordance with the terms hereof,
subject to (a) applicable bankruptcy, insolvency, reorganization, moratorium and
other laws affecting the enforcement of creditors' rights generally, and (b)
general principles of equity, regardless of whether such enforcement is
considered in a proceeding in equity or at law.
6. The Seller is not in violation of, and its execution and delivery of
this Agreement and its performance under and compliance with the terms hereof
will not constitute a violation of, any law, any order or decree of any court or
arbiter, or any order, regulation or demand of any federal, state or local
governmental or regulatory authority, which violation, in the Seller's good
faith and reasonable judgment, is likely to affect materially and adversely
either the ability of the Seller to perform its obligations under this Agreement
or the financial condition of the Seller.
7. There are no actions, suits or proceedings pending or, to the best
of the Seller's knowledge, threatened against the Seller which, if determined
adversely to the Seller, would prohibit the Seller from entering into this
Agreement or, in the Seller's good faith and reasonable judgment, would
B-1-1
be likely to affect materially and adversely either the ability of the Seller to
perform its obligations hereunder or the financial condition of the Seller.
8. No consent, approval, authorization or order of, or filing or
registration with, any state or federal court or governmental agency or body is
required for the consummation by the Seller of the transactions contemplated
herein, except for those consents, approvals, authorizations and orders that
previously have been obtained and those filings and registrations that
previously have been completed, and except for those filings and recordings of
Mortgage Loan documents and assignments thereof that are contemplated by the
Pooling and Servicing Agreement to be completed after the Closing Date.
9. The transfer of the Mortgage Loans to the Purchaser as contemplated
herein is not subject to any bulk transfer or similar law in effect in any
applicable jurisdiction.
10. The Mortgage Loans do not constitute all or substantially all of
the assets of the Seller.
11. The Seller is not transferring the Mortgage Loans to the Purchaser
with any intent to hinder, delay or defraud its present or future creditors.
12. The Seller will be solvent at all relevant times prior to, and will
not be rendered insolvent by, its transfer of the Mortgage Loans to the
Purchaser, as contemplated herein.
13. After giving effect to its transfer of the Mortgage Loans to the
Purchaser, as provided herein, the value of the Seller's assets, either taken at
their present fair saleable value or at fair valuation, will exceed the amount
of the Seller's debts and obligations, including contingent and unliquidated
debts and obligations of the Seller, and the Seller will not be left with
unreasonably small assets or capital with which to engage in and conduct its
business.
14. The Seller does not intend to, and does not believe that it will,
incur debts or obligations beyond its ability to pay such debts and obligations
as they mature.
15. No proceedings looking toward liquidation, dissolution or
bankruptcy of the Seller are pending or contemplated.
16. In connection with its transfer of the Mortgage Loans to the
Purchaser as contemplated herein, the Seller is receiving new value and
consideration constituting at least reasonably equivalent value and fair
consideration.
B-1-2
EXHIBIT B-2
REPRESENTATIONS AND WARRANTIES WITH RESPECT TO THE PURCHASER
The Purchaser hereby represents and warrants that, as of the
Closing Date:
1. The Purchaser is a corporation duly organized, validly existing and
in good standing under the laws of the State of Delaware.
2. The execution and delivery by the Purchaser of, and the performance
by the Purchaser under, this Agreement, and the consummation by the Purchaser of
transactions herein contemplated, will not: (a) violate the Purchaser's
organizational documents; or (b) constitute a default (or an event which, with
notice or lapse of time, or both, would constitute a default) under, or result
in the breach of, any indenture, agreement or other instrument to which the
Purchaser is a party or by which it is bound or which is applicable to it or any
of its assets, which default or breach, in the Purchaser's good faith and
reasonable judgment, is likely to affect materially and adversely either the
ability of the Purchaser to perform its obligations under this Agreement or the
financial condition of the Purchaser.
3. The Purchaser has full power and authority to enter into and perform
under this Agreement, has duly authorized the execution, delivery and
performance of this Agreement, and has duly executed and delivered this
Agreement.
4. Assuming due authorization, execution and delivery hereof by the
Seller, this Agreement constitutes a valid, legal and binding obligation of the
Purchaser, enforceable against the Purchaser in accordance with the terms
hereof, subject to (a) applicable bankruptcy, insolvency, reorganization,
moratorium and other laws affecting the enforcement of creditors' rights
generally, and (b) general principles of equity, regardless of whether such
enforcement is considered in a proceeding in equity or at law.
5. The Purchaser is not in violation of, and its execution and delivery
of this Agreement and its performance under and compliance with the terms hereof
will not constitute a violation of, any law, any order or decree of any court or
arbiter, or any order, regulation or demand of any federal, state or local
governmental or regulatory authority, which violation, in the Purchaser's good
faith and reasonable judgment, is likely to affect materially and adversely
either the ability of the Purchaser to perform its obligations under this
Agreement or the financial condition of the Purchaser.
6. There are no actions, suits or proceedings pending or, to the best
of the Purchaser's knowledge, threatened against the Purchaser which, if
determined adversely to the Purchaser, would prohibit the Purchaser from
entering into this Agreement or, in the Purchaser's good faith and reasonable
judgment, would be likely to affect materially and adversely either the ability
of the Purchaser to perform its obligations hereunder or the financial condition
of the Purchaser. In addition, there are no actions, suits or proceedings
pending or, to the knowledge of the Purchaser, threatened against the Purchaser
(a) asserting the invalidity of the Pooling and Servicing Agreement or the Class
A-Y Certificates, (b) seeking to prevent the issuance of the Class A-Y
Certificates or the consummation of any of the transactions contemplated by the
Pooling and Servicing Agreement, or (c) which might materially and adversely
affect the performance by the Purchaser of its obligations under, or the
validity
B-2-1
or enforceability against the Purchaser of, the Pooling and Servicing
Agreement or the Class A-Y Certificates.
7. Assuming (a) the accuracy of the representations and warranties of
the Seller set forth in Section 4(c) of this Agreement and (b) the compliance by
the Seller with the requirements of Section 5.02 of the Pooling and Servicing
Agreement, no consent, approval, authorization or order of, or filing or
registration with, any state or federal court or governmental agency or body is
required for the consummation by the Purchaser of the transactions contemplated
herein, except for those consents, approvals, authorizations and orders that
previously have been obtained and those filings and registrations that
previously have been completed, and except for those filings of Mortgage Loan
documents and assignments thereof that are contemplated by the Pooling and
Servicing Agreement to be completed after the Closing Date.
8. On the Closing Date, the Class A-Y Certificates will have been duly
authorized by the Purchaser and, following (a) due execution and authentication
thereof by the Trustee on such date, (b) issuance thereof in accordance with the
terms of the Pooling and Servicing Agreement and (c) delivery thereof to the
Seller, as partial consideration for the Mortgage Loans, pursuant to this
Agreement, will be validly issued and outstanding and entitled to the benefits
provided by the Pooling and Servicing Agreement.
9. The Pooling and Servicing Agreement will not be required to be
qualified under the Trust Indenture Act of 1939, and the Trust Fund will not, as
a result of the transfer of the Class A-Y Certificates as contemplated by this
Agreement, be required to be registered under the Investment Company Act of
1940, as amended.
10. At the time of the execution and delivery of the Pooling and
Servicing Agreement, the Purchaser (a) will convey to the Trustee, or cause to
be conveyed to the Trustee, all of the Purchaser's right, title and interest in
and to the Mortgage Loans and the loans being transferred to the Trustee
pursuant to the Pooling and Servicing Agreement (such others loans, the "Other
Loans"), free and clear of any lien, mortgage, pledge, charge, encumbrance,
adverse claim or other security interest (collectively "Liens") granted by or
imposed upon the Purchaser, (b) will not have assigned to any other person any
of its right, title or interest in the Mortgage Loans, the Other Loans or the
Class A-Y Certificates, and (c) will have the power and authority to transfer or
cause the transfer of the Mortgage Loans and the Other Loans to the Trustee and
to transfer the Class A-Y Certificates to the Seller.
11. Upon execution and delivery of the Pooling and Servicing Agreement
by the Trustee, the Trustee will have acquired ownership of all of the
Purchaser's right, title and interest in and to the Mortgage Loans and the Other
Loans, and upon delivery to the Seller of the Class A-Y Certificates pursuant
hereto, the Seller will have good title to the Class A-Y Certificates, free of
Liens granted by or imposed upon the Purchaser.
12. Upon sale of Certificates representing at least 10% of the total
principal balance of all the Certificates to unaffiliated third parties, the
Purchaser will, under generally accepted accounting principles, report the
transfer of the Mortgage Loans and the Other Loans to the Trustee in exchange
for the Certificates and the transfer of the Class A-Y Certificates to the
Seller pursuant to this Agreement as a sale of the interest in the Mortgage
Loans and the Other Loans evidenced by the Class A-Y Certificates.
B-2-2
13. Any taxes, fees and other governmental charges in connection with
the execution, delivery and issuance of this Agreement, the Pooling and
Servicing Agreement and the Class A-Y Certificates payable by the Purchaser
(other than income taxes) have been paid or will be paid at or prior to the
Closing Date.
14. Assuming (a) the accuracy of the representations and warranties of
the Seller set forth in Section 4(c) of this Agreement and (b) the compliance by
the Seller with the requirements of Section 5.02 of the Pooling and Servicing
Agreement, the transfer of the Class A-Y Certificates to the Seller in the
manner contemplated hereby is exempt from registration under the Securities Act.
15. Assuming (a) the accuracy of the representations and warranties of
the Seller set forth in Section 4(c) of this Agreement and (b) the compliance by
the Seller with the requirements of Section 5.02 of the Pooling and Servicing
Agreement, the Purchaser has not offered or sold, and will not offer or sell,
any Class A-Y Certificates or any other security in any manner that would render
the transfer of the Class A-Y Certificates hereunder a violation of the
Securities Act or any state securities or "Blue Sky" laws or require
registration or qualification pursuant thereto, nor has it authorized, nor will
it authorize, any person to act in such manner.
16. When the Class A-Y Certificates are issued pursuant to the Pooling
and Servicing Agreement and delivered pursuant to this Agreement, the Class A-Y
Certificates will not be of the same class (within the meaning of Rule 144A
under the Securities Act) as securities which are listed on a national
securities exchange registered under Section 6 of the Securities and Exchange
Act of 1934, as amended (the "Exchange Act") or quoted in a U.S. automated
inter-dealer quotation system.
17. Within the preceding six months, neither the Purchaser nor any
other person acting on behalf of the Purchaser has offered or sold to any person
any securities (in addition to the Certificates) that would be considered part
of the offering of the Class A-Y Certificates within the meaning of Rule 502
under the Securities Act. The Purchaser will take reasonable precautions
designed to insure that any offer or sale, direct or indirect, in the United
States, its territories and possessions, or to any U.S. person (as defined in
Rule 902 under the Securities Act) of any securities substantially similar to
the Class A-Y Certificates issued by the Purchaser, within six months subsequent
to the Closing Date, is made under restrictions and/or other circumstances
reasonably designed not to effect the status of any offer or resale of the Class
A-Y Certificates in the United States, its territories and possessions, and to
U.S. persons as transactions exempt from the registration provisions of the
Securities Act.
B-2-3
EXHIBIT C
REPRESENTATIONS AND WARRANTIES WITH RESPECT TO THE MORTGAGE LOANS
For purposes of these representations and warranties, the phrases "to
the knowledge of the Seller" or "to the Seller's knowledge" shall mean, except
where otherwise expressly set forth below, the actual state of knowledge of the
Seller or any servicer acting on its behalf regarding the matters referred to,
in each case: (i) after the Seller's having conducted such inquiry and due
diligence into such matters as would be customarily performed by prudent
institutional commercial or multifamily, as applicable, mortgage lenders, and in
all events as required by the Seller's underwriting standards, at the time of
the Seller's origination or acquisition of the particular Mortgage Loan; and
(ii) subsequent to such origination, utilizing the servicing and monitoring
practices customarily utilized by prudent commercial mortgage loan servicers
with respect to securitizable commercial or multifamily, as applicable, mortgage
loans. Also for purposes of these representations and warranties, the phrases
"to the actual knowledge of the Seller" or "to the Seller's actual knowledge"
shall mean, except where otherwise expressly set forth below, the actual state
of knowledge of the Seller or any servicer acting on its behalf without any
express or implied obligation to make inquiry. All information contained in
documents which are part of or required to be part of a Mortgage File shall be
deemed to be within the knowledge and the actual knowledge of the Seller.
Wherever there is a reference to receipt by, or possession of, the Seller of any
information or documents, or to any action taken by the Seller or not taken by
the Seller or its agents or employees, such reference shall include the receipt
or possession of such information or documents by, or the taking of such action
or the not taking such action by, either of the Seller or any servicer acting on
its behalf.
The Seller hereby represents and warrants with respect to the Mortgage
Loans that, as of the date hereinbelow specified or, if no such date is
specified, as of the Closing Date, and subject to Section 18 of this Agreement:
1. Mortgage Loan Schedule. The information set forth in the Mortgage
Loan Schedule with respect to the Mortgage Loans is true, complete (in
accordance with the requirements of this Agreement and the Pooling and Servicing
Agreement) and correct in all material respects as of the date of this Agreement
and as of the respective Due Dates for the Mortgage Loans in November 2001.
2. Ownership of Mortgage Loans. Immediately prior to the transfer of
the Mortgage Loans to the Purchaser, the Seller had good title to, and was the
sole owner of, each Mortgage Loan. The Seller has full right, power and
authority to sell, transfer and assign each Mortgage Loan to, or at the
direction of, the Purchaser free and clear of any and all pledges, liens,
charges, security interests, participation interests and/or other interests and
encumbrances (except for certain servicing rights described on Schedule C-42
hereto or otherwise contemplated by this Agreement or the Pooling and Servicing
Agreement). Subject to the completion of the names and addresses of the
assignees and endorsees and any missing recording information in all instruments
of transfer or assignment and endorsements and the completion of all recording
and filing contemplated hereby and by the Pooling and Servicing Agreement, the
Seller will have validly and effectively conveyed to the 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 (except for certain
servicing rights described on Schedule C-42 hereto or otherwise contemplated by
this Agreement or the Pooling and Servicing Agreement). The sale of the
C-1
Mortgage Loans to the Purchaser or its designee does not require the Seller to
obtain any governmental or regulatory approval or consent that has not been
obtained. Each Mortgage Note is, or shall be as of the Closing Date, properly
endorsed to the Purchaser or its designee and each such endorsement is genuine.
3. Payment Record. No scheduled payment of principal and interest due
under any Mortgage Loan on the Due Date in October 2001 and on any Due Date in
the twelve-month period immediately preceding the Due Date for such Mortgage
Loan in October 2001 was 30 days or more delinquent, 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 the following (collectively, the "Permitted Encumbrances"): (a) the
lien for current real estate taxes, water charges, sewer rents 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 are referred to
in the related lender's title insurance policy (or, if not yet issued, referred
to in a pro forma title policy or title policy commitment meeting the
requirements described in Paragraph 8 below); (c) exceptions and exclusions
specifically referred to in the related lender's title insurance policy (or, if
not yet issued, referred to in a pro forma title policy or title policy
commitment meeting the requirements described in Paragraph 8 below); (d) other
matters to which like properties are commonly subject; (e) the rights of tenants
(as tenants only) under leases (including subleases) pertaining to the related
Mortgaged Property; (f) condominium declarations of record and identified in the
related lender's title insurance policy (or, if not yet issued, identified in a
pro forma title policy or title policy commitment meeting the requirements
described in Paragraph 8 below); and (g) if such Mortgage Loan constitutes a
Cross-Collateralized Mortgage Loan, the lien of the Mortgage for another
Mortgage Loan contained in the same Cross-Collateralized Group. With respect to
each Mortgage Loan, such Permitted Encumbrances do not, individually or in the
aggregate, materially interfere with the security intended to be provided by the
related Mortgage, the current principal use of the related Mortgaged Property or
the ability of the related Mortgaged Property to generate income sufficient to
service such Mortgage Loan. If the related Mortgaged Property is a residential
cooperative property, then the related Mortgage is superior to any lien against
the related Mortgaged Property securing any and all other debts of and to the
subject cooperative entity. The related assignment of the Mortgage for each
Mortgage Loan, executed and delivered in favor of the Trustee, is in recordable
form (but for insertion of the name and address of the assignee and any related
recording information which is not yet available to the Seller) to validly and
effectively convey the assignor's interest therein and constitutes a legal,
valid, binding and, subject to the exceptions set forth in Paragraph 13 below,
enforceable assignment of such Mortgage from the relevant assignor to the
Trustee.
5. Assignment of Leases. The Mortgage File contains an assignment of
leases and rents (an "Assignment of Leases"), either as a separate instrument or
incorporated into the related Mortgage, which establishes and creates a valid,
subsisting and, subject to the exceptions set forth in Paragraph 13 below,
enforceable first priority lien on and security interest in, subject to
applicable law, the property, rights and interests of the related Borrower
described therein, except that a license may have been granted to the related
Borrower to exercise certain rights and perform certain obligations of the
lessor under the relevant lease or leases, including, without limitation, the
right to operate the related leased property; and each assignor thereunder has
the full right to assign the same. The related
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assignment of any Assignment of Leases not included in a Mortgage, executed and
delivered in favor of the Trustee is in recordable form (but for insertion of
the name and address of the assignee and any related recording information which
is not yet available to the Seller) to validly and effectively convey the
assignor's interest therein and constitutes a legal, valid, binding and, subject
to the exceptions set forth in Paragraph 13 below, enforceable assignment of
such Assignment of Leases from the relevant assignor to the Trustee.
6. Mortgage Status; Waivers and Modifications. In the case of each
Mortgage Loan, except by a written instrument which has been delivered to the
Purchaser or its designee as a part of the related Mortgage File, (a) the
related Mortgage (including any amendments or supplements thereto included in
the related Mortgage File) has not been impaired, waived, modified, altered,
satisfied, canceled, subordinated or rescinded, (b) neither the related
Mortgaged Property nor any material portion thereof has been released from the
lien of such Mortgage and (c) the related Borrower has not been released from
its obligations under such Mortgage, in whole or in material part. Except as
described on Schedule C-6 hereto, no alterations, waivers, modifications or
assumptions of any kind have been given, made or consented to by or on behalf of
the Seller since [SPECIFY DATE AS OF WHICH MORTGAGE FILES WERE DELIVERED TO
B-PIECE BUYER]. The Seller has not taken any affirmative action that would cause
the representations and warranties of the related Borrower under the Mortgage
Loan not to be true and correct in any material respect.
7. Condition of Property; Condemnation. In the case of each Mortgage
Loan, except as set forth on Schedule C-7A or in an engineering report prepared
in connection with the origination of such Mortgage Loan, the related Mortgaged
Property is, to the Seller's knowledge, in good repair, free and clear of any
damage that would materially and adversely affect its value as security for such
Mortgage Loan (except in any such case where an escrow of funds or insurance
coverage exists sufficient to effect the necessary repairs and maintenance);
provided that, if no engineer or architect physically visited the related
Mortgaged Property in connection with preparing and delivering such engineering
report, then the representation and warranty made in this sentence shall not be
qualified by "to the Seller's knowledge". As of origination of such Mortgage
Loan there was no proceeding pending, and subsequent to such date, the Seller
has not received actual notice of, any proceeding pending for the condemnation
of all or any material portion of the Mortgaged Property securing any Mortgage
Loan. If any of the engineering reports referred to above in this Paragraph 7
revealed any material damage or material deferred maintenance, then one of the
following is true: (a) the repairs and/or maintenance necessary to correct such
condition have been completed in all material respects; (b) an escrow of funds
is required or a letter of credit was obtained in an amount reasonably estimated
to be sufficient to complete the repairs and/or maintenance necessary to correct
such condition; or (c) the reasonable estimate of the cost to complete the
repairs and/or maintenance necessary to correct such condition represented no
more than 2% of the value of the related Mortgaged Property as reflected in an
appraisal conducted in connection with the origination of the subject Mortgage
Loan. As of the date of the origination of each Mortgage Loan, except as set
forth on Schedule C-7B: (a) all of the material improvements on the related
Mortgaged Property lay wholly within the boundaries and, to the extent in effect
at the time of construction, building restriction lines of such property, except
for encroachments that are insured against by the lender's title insurance
policy referred to in Paragraph 8 below or that do not materially and adversely
affect the value or marketability of such Mortgaged Property, and (b) 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
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encroachments that are insured against by the lender's title insurance policy
referred to in Paragraph 8 below.
8. Title Insurance. The lien of each Mortgage securing a Mortgage Loan
is insured by an American Land Title Association (or an equivalent form of)
lender's title insurance policy (the "Title Policy") (except that if such policy
is yet to be issued, such insurance may be evidenced by a "marked up" pro forma
policy or title commitment in either case marked as binding and countersigned by
the title company or its authorized agent, either on its face or by an
acknowledged closing instruction or escrow letter) in the original principal
amount of such Mortgage Loan after all advances of principal, insuring the
originator of the related Mortgage Loan, its successors and assigns (as the sole
insured) that the related Mortgage is a valid first priority lien on such
Mortgaged Property, subject only to the Permitted Encumbrances. Such 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, the Seller has
made no claims thereunder and, to the Seller's actual knowledge, no prior holder
of the related Mortgage has made any claims thereunder and no claims have been
paid thereunder. The Seller has not, and to the Seller's actual knowledge, no
prior holder of the related Mortgage has, done, by act or omission, anything
that would materially impair the coverage under such Title Policy. Immediately
following the transfer and assignment of the related Mortgage Loan to the
Trustee (including endorsement and delivery of the related Mortgage Note to the
Purchaser and recording of the related Assignment of Mortgage in favor of the
Purchaser in the applicable real estate records), such Title Policy (or, if it
has yet to be issued, the coverage to be provided thereby) will inure to the
benefit of the Trustee without the consent of or notice to the insurer. Such
Title Policy contains no exclusion for, or it affirmatively insures (unless the
related Mortgaged Property is located in a jurisdiction where such affirmative
insurance is not available), (a) access to a public road, and (b) that the area
shown on the survey, if any, reviewed or prepared in connection with the
origination of the related Mortgage Loan is the same as the property legally
described in the related Mortgage.
9. No Holdback. The proceeds of each Mortgage Loan have been fully
disbursed (except in those cases where the full amount of the Mortgage Loan has
been disbursed but a portion thereof is being held in escrow or reserve accounts
pending the satisfaction of certain conditions relating to leasing, repairs or
other matters with respect to the related Mortgaged Property), and there is no
obligation for future advances with respect thereto. If the related Mortgage
Loan Documents include any requirements regarding (a) the completion of any
on-site or off-site improvements and (b) the disbursement of any funds escrowed
for such purpose, and if those requirements were to have been complied with on
or before the Closing Date, then such requirements have been complied with in
all material respects or such funds so escrowed have not been released except to
the extent specifically provided by the related Mortgage Loan Documents.
10. Mortgage Provisions. The Mortgage Note, Mortgage and Assignment of
Leases for each Mortgage Loan, together with applicable state law, contains
customary and, subject to the exceptions set forth in Paragraph 13 below,
enforceable provisions for commercial Mortgage Loans such as to render the
rights and remedies of the holder thereof adequate for the practical realization
against the related Mortgaged Property of the principal benefits of the security
intended to be provided thereby.
11. Trustee under Deed of Trust. If the Mortgage for any Mortgage Loan
is a deed of trust, then (a) a trustee, duly qualified under applicable law to
serve as such, has either been properly designated and currently so serves or
may be substituted in accordance with the Mortgage and
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applicable law, and (b) no fees or expenses are payable to such trustee by the
Seller, the Depositor or any transferee thereof except for such fees and
expenses (all of which are the obligation of the related Borrower under the
related Mortgage Loan Documents) as would be payable in connection with a
trustee's sale after default by the related Borrower or in connection with any
full or partial release of the related Mortgaged Property or related security
for such Mortgage Loan.
12. Environmental Conditions. Except in the case of the Mortgaged
Properties identified on Schedule C-12(Ab/LBP) (as to which properties the only
environmental investigation conducted in connection with the origination of the
related Mortgage Loan related to asbestos-containing materials and lead-based
paint) and Schedule C-12(TS) (as to which a transaction screen meeting the
requirements of the American Society for Testing and Materials (a "Transaction
Screen") was performed), (a) an environmental site assessment meeting the
requirements of the American Society for Testing and Materials and covering all
environmental hazards typically assessed for similar properties including use,
type and tenants of the Mortgaged Property ("Environmental Report"), or an
update of such an assessment, was performed by a licensed (to the extent
required by applicable state law) environmental consulting firm with respect to
each Mortgaged Property securing a Mortgage Loan in connection with the
origination of such Mortgage Loan and, except with respect to the Mortgaged
Properties identified on Schedule C-12(NU), thereafter updated such that, except
as set forth on Schedule C-12(OLD), such Environmental Report is dated no
earlier than twelve months prior to the Closing Date, (b) a copy of each such
Environmental Report has been delivered to the Purchaser, and (c) either: (i) no
such Environmental Report provides that as of the date of the report there is a
material violation of any applicable environmental laws with respect to any
circumstances or conditions relating to the related Mortgaged Property; or (ii)
if any such Environmental Report does reveal any such circumstances or
conditions with respect to the related Mortgaged Property and the same have not
been subsequently remediated in all material respects, then, except as described
on Schedule C-12(MV), one or more of the following are true--(A) one or more
parties not related to or including the related Borrower and collectively having
financial resources reasonably estimated to be adequate to cure the subject
violation in all material respects, were identified as the responsible party or
parties for such condition or circumstance and such condition or circumstance
does not materially impair the value of the Mortgaged Property, (B) the related
Borrower was required to provide additional security reasonably estimated to be
adequate to cure the subject violation in all material respects and/or to obtain
an operations and maintenance plan, (C) the related Borrower, or other
responsible party, provided a "no further action" letter or other evidence
reasonably acceptable to a reasonably prudent commercial mortgage lender that
applicable federal, state or local governmental authorities had no current
intention of taking any action, and are not requiring any action, in respect of
such condition or circumstance, (D) such conditions or circumstances were
investigated further and based upon such additional investigation, an
environmental consultant recommended no further investigation or remediation,
(E) the expenditure of funds reasonably estimated to be necessary to effect such
remediation is not greater than 2% of the outstanding principal balance of the
related Mortgage Loan, (F) there exists an escrow of funds reasonably estimated
to be sufficient for purposes of effecting such remediation, (G) the related
Mortgaged Property is identified on Schedule C-12(EI) and insured under a policy
of insurance subject to reasonable per occurrence and aggregate limits and a
reasonable deductible, against certain losses arising from such circumstances
and conditions or (H) a party with financial resources reasonably estimated to
be adequate to cure the subject violation in all material respects provided a
guaranty or indemnity to the related Borrower to cover the costs of any required
investigation, testing, monitoring or remediation. To the Seller's actual
knowledge, there are no significant or material circumstances or conditions with
respect to any Mortgaged Property not revealed in any such Environmental Report,
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where obtained, or in any Borrower questionnaire delivered to the Seller in
connection with the issue of any related environmental insurance policy, if
applicable, that render such Mortgaged Property in material violation of any
applicable environmental laws. The Mortgage Loan Documents for each Mortgage
Loan require the related Borrower to comply in all material respects with all
applicable federal, state and local environmental laws and regulations. The
Seller has not taken any affirmative action which would cause the Mortgaged
Property securing any Mortgage Loan not to be in compliance with all federal,
state and local laws pertaining to environmental hazards. Each Borrower
represents and warrants in the related Mortgage Loan documents generally to the
effect that, except as set forth in certain specified environmental reports and
to the Borrower's knowledge, it has not used, caused or permitted to exist and
will not use, cause or permit to exist on the related Mortgaged Property any
hazardous materials in any manner which violates federal, state or local laws,
ordinances, regulations, orders, directives, or policies governing the use,
storage, treatment, transportation, manufacture, refinement, handling,
production or disposal of hazardous materials. Unless the related Mortgaged
Property is identified on Schedule C-12(EI), the related Borrower (or an
affiliate thereof) has agreed to indemnify, defend and hold the Seller and its
successors and assigns harmless from and against, or otherwise be liable for,
any and all losses resulting from a breach of environmental representations,
warranties or covenants given by the Borrower in connection with such Mortgage
Loan, generally including any and all losses, liabilities, damages, injuries,
penalties, fines, expenses and claims of any kind or nature whatsoever
(including without limitation, attorneys' fees and expenses) paid, incurred or
suffered by or asserted against, any such party resulting from such breach.
13. Loan Document Status. Each Mortgage Note, Mortgage, and other
agreement executed by or on behalf of the related Borrower, or any guarantor of
non-recourse exceptions and environmental liability, with respect to each
Mortgage Loan 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 (i) bankruptcy, insolvency, reorganization,
fraudulent transfer and conveyance or other similar laws affecting the
enforcement of creditors' rights generally and (ii) general principles of equity
(regardless of whether such enforcement is considered in a proceeding in equity
or at law), and except that certain provisions in such loan documents may be
further limited or rendered unenforceable by applicable law, but (subject to the
limitations set forth in the foregoing clauses (i) and (ii)) such limitations
will not render such loan documents invalid as a whole or substantially
interfere with the mortgagee's realization of the principal benefits and/or
security provided thereby. There is no right of rescission, offset, abatement,
diminution or valid defense or counterclaim available to the related Borrower
with respect to such Mortgage Note, Mortgage or other agreements that would deny
the mortgagee the principal benefits intended to be provided thereby. The Seller
has no actual knowledge of any such rights, defenses or counterclaims having
been asserted.
14. Insurance. Except in certain cases, where tenants, having a net
worth of at least $50,000,000 or an investment grade credit rating and obligated
to maintain the insurance described in this paragraph, are allowed to
self-insure the related Mortgaged Properties, and except as otherwise set forth
on Schedule C-14(a), all improvements upon each Mortgaged Property securing a
Mortgage Loan are insured under a fire and extended perils insurance policy
included within the classification "All Risk of Physical Loss" insurance (or the
equivalent) policy in an amount at least equal to the lesser of the outstanding
principal balance of such Mortgage Loan and 100% of the insurable replacement
cost of the improvements located on the related Mortgaged Property, and if
applicable, the related hazard insurance
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policy contains appropriate endorsements to avoid the application of
co-insurance and does not permit reduction in insurance proceeds for
depreciation. Except in the case of the Mortgaged Properties identified on
Schedule C-14(b) hereto, each Mortgaged Property securing a Mortgage Loan is the
subject of a business interruption or rent loss insurance policy providing
coverage for at least twelve (12) months (or a specified dollar amount which is
reasonably estimated to cover no less than twelve (12) months of rental income).
If, based solely on a flood zone certification or a survey of the related
Mortgaged Property, any portion of the improvements on a Mortgaged Property
securing any Mortgage Loan was, at the time of the origination of such Mortgage
Loan, in an area identified in the Federal Register by the Flood Emergency
Management Agency as a special flood hazard area (Zone A or Zone V) (an "SFH
Area") and flood insurance was available, then a flood insurance policy meeting
the requirements of the then current guidelines of the Federal Insurance
Administration is in effect with a generally acceptable insurance carrier, in an
amount representing coverage not less than the least of (1) the minimum amount
required, under the terms of coverage, to compensate for any damage or loss on a
replacement basis, (2) the outstanding principal balance of such Mortgage Loan,
and (3) the maximum amount of insurance available under the applicable National
Flood Insurance Administration Program. All such hazard and flood insurance
policies contain a standard mortgagee clause for the benefit of the holder of
the related Mortgage, its successors and assigns, as mortgagee, and are not
terminable (nor may the amount of coverage provided thereunder be reduced)
without ten (10) days' prior written notice to the mortgagee; and no such notice
has been received, including any notice of nonpayment of premiums, that has not
been cured and, to the Seller's actual knowledge, all such insurance is in full
force and effect. Each Mortgaged Property and all improvements thereon are also
covered by comprehensive general liability insurance in such amounts as are
generally required by reasonably prudent commercial lenders for similar
properties and seismic insurance to the extent any Mortgaged Property has a
probable maximum loss of greater than twenty percent (20%) of the replacement
value of the related improvements, calculated using methodology acceptable to a
reasonably prudent commercial mortgage lender with respect to similar properties
in same area or earthquake zone. If the Mortgaged Property for any Mortgage Loan
is located in Florida or within 25 miles of the coast in Texas, Louisiana,
Mississippi, Alabama, Georgia, North Carolina or South Carolina, then such
Mortgaged Property is insured by windstorm insurance in an amount at least equal
to the lesser of (i) the outstanding principal balance of such Mortgage Loan and
(ii) 100% of the insurable replacement cost of the improvements located on the
related Mortgaged Property. If any Mortgaged Property is, to the Seller's
knowledge, a materially non-conforming use or structure under applicable zoning
laws and ordinances, then, in the event of a material casualty or destruction,
one or more of the following is true: (i) such Mortgaged Property may be
restored or repaired to materially the same extent of the use or structure at
the time of such casualty; (ii) such Mortgaged Property is covered by law and
ordinance insurance in an amount customarily required by reasonably prudent
commercial mortgage lenders; or (iii) the amount of hazard insurance currently
in place and required by the related Mortgage Loan Documents would generate
proceeds sufficient to pay off the subject Mortgage Loan. Additionally, for any
Mortgage Loan having a Cut-off Date Principal Balance equal to or greater than
$20,000,000, the insurer for all of the required coverages set forth herein has
a claims paying ability rating from Standard & Poor's, Xxxxx'x or Fitch of not
less than A-minus (or the equivalent), or from A.M. Best of not less than "A:V"
(or the equivalent). With respect to each Mortgage Loan, the related Mortgage
Loan Documents require that the related Borrower or a tenant of such Borrower
maintain insurance as described above or permit the Mortgagee to require
insurance as described above. Except under circumstances that would be
reasonably acceptable to a prudent commercial mortgage lender or that would not
otherwise materially and adversely affect the security intended to be provided
by the related Mortgage, the Mortgage Loan Documents for each Mortgage Loan
provide that proceeds paid
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under any such casualty insurance policy will (or, at the lender's option, will)
be applied either to the repair or restoration of the related Mortgaged Property
or to the payment of amounts due under such Mortgage Loan; provided that the
related Mortgage Loan Documents may entitle the related Borrower to any portion
of such proceeds remaining after the repair or restoration of the related
Mortgaged Property or payment of amounts due under the Mortgage Loan; and
provided, further, that, if the related Borrower holds a leasehold interest in
the related Mortgaged Property, the application of such proceeds will be subject
to the terms of the related Ground Lease (as defined in Paragraph 18 below). To
the Seller's actual knowledge, all insurance policies described above are with
an insurance carrier qualified to write insurance in the relevant jurisdiction.
15. Taxes and Assessments. As of the date of origination of the subject
Mortgage Loan or November 11, 2000, whichever is later, there were no (and, to
the Seller's actual knowledge, as of the Closing Date, there are no) delinquent
property taxes or assessments or other outstanding charges affecting any
Mortgaged Property securing a Mortgage Loan that are not otherwise covered by an
escrow of funds sufficient to pay such charge. For purposes of this
representation and warranty, real property taxes and assessments shall not be
considered delinquent until the date on which interest and/or penalties would be
payable thereon.
16. Borrower Bankruptcy. No Mortgaged Property securing a Mortgage Loan
is the subject of, and no Borrower under a Mortgage Loan is a debtor in, any
state or federal bankruptcy, insolvency or similar proceeding.
17. Local Law Compliance. To the Seller's knowledge, based upon a
letter from governmental authorities, a legal opinion, a zoning consultant's
report, an endorsement to the related Title Policy, or a representation of the
related Borrower at the time of origination of the subject Mortgage Loan, or
based on such other due diligence considered reasonable by prudent commercial
mortgage lenders in the lending area where the subject Mortgaged Property is
located, except as described on Schedule C-17, the improvements located on or
forming part of, and the existing use of, each Mortgaged Property securing a
Mortgage Loan are in material compliance with applicable zoning laws and
ordinances or constitute a legal non-conforming use or structure (or, if any
such improvement does not so comply and does not constitute a legal
non-conforming use or structure, such non-compliance and failure does not
materially and adversely affect the value of the related Mortgaged Property as
determined by the appraisal performed in connection with the origination of such
Mortgage Loan).
18. Leasehold Estate Only. If any Mortgage Loan is secured by the
interest of a Borrower as a lessee under a ground lease (together with any and
all written amendments and modifications thereof and any and all estoppels from
or other agreements with the ground lessor, a "Ground Lease"), but not by the
related fee interest in the subject real property (the "Fee Interest"), then:
(a) Such Ground Lease or a memorandum thereof has been or will be duly
recorded; such Ground Lease permits the interest of the lessee thereunder to be
encumbered by the related Mortgage and does not restrict the use of the related
Mortgaged Property by such lessee, its successors or assigns in a manner that
would materially adversely affect the security provided by the related Mortgage;
and there has been no material change in the terms of such Ground Lease since
its recordation, with the exception of material changes reflected in written
instruments which are a part of the related Mortgage File;
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(b) The related lessee's leasehold interest in the portion of the
related Mortgaged Property covered by 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, and such Ground Lease provides that
it shall remain superior to any mortgage or other lien upon the related Fee
Interest;
(c) The Borrower's interest in such Ground Lease is assignable to, and
is thereafter further assignable by, the Purchaser upon notice to, but without
the consent of, the lessor thereunder (or, if such consent is required, it has
been obtained); provided that such Ground Lease has not been terminated and all
defaults, if any, on the part of the related lessee have been cured;
(d) The Seller has not received, as of the Closing Date, actual notice
that such Ground Lease is not in full force and effect or that any material
default has occurred under such Ground Lease, and the lessor under such Ground
Lease has been sent notice of the lien evidenced by the Mortgage in accordance
with the terms of the Ground Lease;
(e) Such Ground Lease requires the lessor thereunder to give notice of
any default by the lessee to the mortgagee under such Mortgage Loan.
Furthermore, such Ground Lease further provides that no notice of termination
given under such Ground Lease is effective against the mortgagee under such
Mortgage Loan unless a copy has been delivered to such mortgagee in the manner
described in such Ground Lease;
(f) The mortgagee under such Mortgage Loan is permitted a reasonable
opportunity (including, where necessary, sufficient time to gain possession of
the interest of the lessee under such Ground Lease) to cure any default under
such Ground Lease, which is curable after the receipt of notice of any such
default, before the lessor thereunder may terminate such Ground Lease;
(g) Such Ground Lease has an original term (or an original term plus
options exercisable by the holder of the related Mortgage) which extends not
less than twenty (20) years beyond the end of the amortization term of such
Mortgage Loan;
(h) Such Ground Lease requires the lessor to enter into a new lease
with a mortgagee upon termination of such Ground Lease as a result of a
rejection of such Ground Lease in a bankruptcy proceeding involving the related
Borrower unless the mortgagee under such Mortgage Loan fails to cure a default
of the lessee under such Ground Lease following notice thereof from the lessor;
(i) Except as described on Schedule C-18(i), under the terms of such
Ground Lease and the related Mortgage Loan Documents, taken together, any
casualty insurance proceeds, other than de minimis amounts for minor casualties,
with respect to the leasehold interest will be applied either: (i) to the repair
or restoration of all or part of the related Mortgaged Property, with the
mortgagee or a trustee appointed by it having the right to hold and disburse
such proceeds as the repair or restoration progresses (except in such cases
where a provision entitling another party to hold and disburse such proceeds
would not be viewed as commercially unreasonable by a prudent commercial
mortgage lender), or (ii) to the payment of the outstanding principal balance of
the Mortgage Loan together with any accrued interest thereon. Under the terms of
such Ground Lease and the related Mortgage Loan Documents, taken together, any
condemnation proceeds or awards in respect of a total or substantially total
taking will be applied first to the payment of the outstanding principal and
interest on the Mortgage Loan (except as otherwise provided by applicable law)
and subject to any rights to require the improvements to be rebuilt;
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(j) Such Ground Lease does not impose any restrictions on subletting
which would be viewed as commercially unreasonable by a prudent commercial
mortgage lender in the lending area where the related Mortgaged Property is
located at the time of the origination of such Mortgage Loan;
(k) The lessor under such Ground Lease is not permitted to disturb the
possession, interest or quiet enjoyment of the lessee in the relevant portion of
the Mortgaged Property subject to such Ground Lease for any reason, or in any
manner, which would materially adversely affect the security provided by the
related Mortgage; and
(l) Such Ground Lease provides that it may not be amended or modified
without the prior consent of the mortgagee under such Mortgage Loan and that any
such action without such consent is not binding on such mortgagee, its
successors or assigns.
19. Qualified Mortgage. Such 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), and the related Mortgaged Property, if acquired in
connection with the default or imminent default of such Mortgage Loan, would
constitute "foreclosure property" within the meaning of Section 860G(a)(8).
20. Advancement of Funds. The Seller has not advanced funds, or
induced, solicited or knowingly received any advance of funds from a party other
than the owner of the related Mortgaged Property (or a tenant at or the property
manager of the related Mortgaged Property), for the payment of any amount
required by such Mortgage Loan, except for interest accruing from the date of
origination of such Mortgage Loan or the date of disbursement of the Mortgage
Loan proceeds, whichever is later, to the date which preceded by 30 days the
first due date under the related Mortgage Note.
21. No Equity Interest, Equity Participation or Contingent Interest. No
Mortgage Loan contains any equity participation by the mortgagee thereunder, is
convertible by its terms into an equity ownership interest in the related
Mortgaged Property or the related Borrower, has a shared appreciation feature,
provides for any contingent or additional interest in the form of participation
in the cash flow of the related Mortgaged Property, or, except as identified on
Schedule C-21, provides for interest-only payments without principal
amortization for more than six months or for the negative amortization of
interest, except that, in the case of an ARD Loan, such Mortgage Loan provides
that, during the period commencing on or about the related Anticipated Repayment
Date and continuing until such Mortgage Loan is paid in full, (a) additional
interest shall accrue, may be compounded monthly and shall be payable only after
the outstanding principal of such Mortgage Loan is paid in full, and (b) a
portion of the cash flow generated by such Mortgaged Property will be applied
each month to pay down the principal balance thereof in addition to the
principal portion of the related Monthly Payment. Neither the Seller nor any
affiliate thereof has any obligation to make any capital contribution to the
Borrower under the Mortgage Loan or otherwise.
22. Legal Proceedings. To the Seller's knowledge, as of origination of
the Mortgage Loan, there were no, and to the Seller's actual knowledge, as of
the Closing Date, there are no pending actions, suits, litigation or other
proceedings by or before any court or governmental authority against or
affecting the Borrower (or any guarantor to the extent a reasonably prudent
commercial or multifamily, as applicable, mortgage lender would consider such
guarantor material to the underwriting of such Mortgage Loan) under any Mortgage
Loan or the related Mortgaged Property that, if determined adversely to such
Borrower or Mortgaged Property, would materially and adversely affect the value
of the Mortgaged Property as security for such Mortgage Loan, the Borrower's
ability to pay principal,
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interest or any other amounts due under such Mortgage Loan or the ability of any
such guarantor to meet its obligations.
23. Other Mortgage Liens. Except as otherwise set forth on Schedule
C-23 and except for Mortgage Loans secured by residential cooperative
properties, none of the Mortgage Loans permits the related Mortgaged Property or
any direct controlling equity interest in the related Borrower to be encumbered
by any mortgage lien or, in the case of a direct controlling equity interest in
the related Borrower, a lien to secure any other debt, without the prior written
consent of the holder of the subject Mortgage Loan or the satisfaction of debt
service coverage or similar criteria specified therein. To the Seller's
knowledge, as of origination of the subject Mortgage Loan, and to the Seller's
actual knowledge, as of the Closing Date, except as otherwise set forth on
Schedule C-23, and except for cases involving other Mortgage Loans, no Mortgaged
Property securing the subject Mortgage Loan is encumbered by any other mortgage
liens (other than Permitted Encumbrances) and no direct controlling equity
interest in the related Borrower is encumbered by a lien to secure any other
debt. Except in the case where the related Mortgaged Property is a residential
cooperative property, the related Mortgage Loan Documents require the Borrower
under each Mortgage Loan to pay all reasonable costs and expenses related to any
required consent to an encumbrance, including reasonable legal fees and expenses
and any applicable Rating Agency fees, or would permit the subject mortgagee to
withhold such consent if such costs and expenses are not paid by a party other
than such mortgagee.
24. No Mechanics' Liens. To the Seller's knowledge, as of the
origination of the Mortgage Loan, and, to the Seller's actual knowledge, as of
the Closing Date: (i) each Mortgaged Property securing a Mortgage Loan
(exclusive of any related personal property) is free and clear of any and all
mechanics' and materialmen's liens that are prior or equal to the lien of the
related Mortgage and that are not bonded or escrowed for or covered by title
insurance, and (ii) 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
and that is not bonded or escrowed for or covered by title insurance.
25. Compliance with Usury Laws. Each Mortgage Loan complied with, or
was exempt from, all applicable usury laws in effect at its date of origination.
26. Licenses and Permits. To the extent required by applicable law, and
except as identified on Schedule C-26, each Mortgage Loan requires the related
Borrower to be qualified to do business, and requires the related Borrower and
the related Mortgaged Property to be in material compliance with all
regulations, licenses, permits, authorizations, restrictive covenants and zoning
and building laws, in each case to the extent required by law or to the extent
that the failure to be so qualified or in compliance would have a material and
adverse effect upon the enforceability of the Mortgage Loan or upon the
practical realization against the related Mortgaged Property of the principal
benefits of the security intended to be provided thereby. To the Seller's
knowledge, as of the date of origination of each Mortgage Loan and based on any
of: (i) a letter from governmental authorities, (ii) a legal opinion, (iii) an
endorsement to the related Title Policy, (iv) a representation of the related
Borrower at the time of origination of such Mortgage Loan, (v) a zoning report
from a zoning consultant, or (vi) other due diligence that the originator of the
Mortgage Loan customarily performs in the origination of comparable mortgage
loans, the related Borrower 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 or such material licenses,
permits and franchises have otherwise been issued.
C-11
27. Cross-Collateralization. No Mortgage Loan is cross-collateralized
with any loan which is outside the Mortgage Pool. With respect to any group of
cross-collateralized Mortgage Loans, the sum of the amounts of the respective
Mortgages recorded on the related Mortgaged Properties with respect to such
Mortgage Loans is at least equal to the total amount of such Mortgage Loans.
28. Releases of Mortgaged Properties. Except as set forth on Schedule
C-28A, no Mortgage Note or Mortgage requires the mortgagee to release all or any
material portion of the related Mortgaged Property from the lien of the related
Mortgage except upon: (i) payment in full of all amounts due under the related
Mortgage Loan or (ii) delivery of "government securities" within the meaning of
Treas. Reg. Section 1.860G-2(a)(8)(i) in connection with a defeasance of the
related Mortgage Loan; provided that the Mortgage Loans that are
Cross-Collateralized Mortgage Loans, and the other individual Mortgage Loans
secured by multiple parcels, may require the respective mortgagee(s) to grant
releases of material portions of the related Mortgaged Property or the release
of one or more related Mortgaged Properties upon: (i) the satisfaction of
certain legal and underwriting requirements, (ii) the payment of a release price
(in an amount that is, except as otherwise set forth on Schedule C-28B, at least
equal to 125% of the allocated loan amount for the released property or parcel)
and prepayment consideration in connection therewith or (iii) the delivery of
substitute real estate collateral. No release or partial release of any
Mortgaged Property, or any portion thereof, expressly permitted pursuant to the
terms of any Mortgage Note or Mortgage will constitute a significant
modification of the related Mortgage Loan under Treas. Reg. Section
1.860G-2(b)(2).
29. Defeasance. With respect to any Mortgage Loan that contains a
provision for any defeasance of mortgage collateral (a "Defeasance Loan"), the
related Mortgage Note or Mortgage provides that the defeasance option is not
exercisable prior to a date that is at least two (2) years following the Closing
Date and is otherwise in compliance with applicable statutes, rules and
regulations governing REMICs; requires prior written notice to the holder of the
Mortgage Loan of the exercise of the defeasance option and payment by the
Borrower of all related reasonable fees, costs and expenses as set forth below;
if the Borrower would continue to own assets in addition to the defeasance
collateral, requires, or permits the lender to require, the Mortgage Loan (or
the portion thereof being defeased) to be assumed by a single-purpose entity;
and requires counsel to provide a legal opinion that the Trustee has a perfected
security interest in such collateral prior to any other claim or interest. In
addition, each Mortgage Loan that is a Defeasance Loan permits defeasance only
with substitute collateral constituting "government securities" within the
meaning of Treas. Reg. Section 1.860G-2(a)(8)(i) in an amount sufficient to make
all scheduled payments under the Mortgage Note (or the portion thereof being
defeased) when due, and in the case of ARD Loans, assuming the Anticipated
Repayment Date is the Maturity Date. To the Seller's actual knowledge,
defeasance under the Mortgage Loan is only for the purpose of facilitating the
disposition of a Mortgaged Property and not as part of an arrangement to
collateralize a REMIC offering with obligations that are not real estate
mortgages. With respect to each Defeasance Loan, except as set forth on Schedule
C-29, the related Mortgage Loan Documents provide that the related Borrower
shall (a) pay all Rating Agency fees associated with defeasance (if rating
confirmation is a specific condition precedent thereto) and all other reasonable
expenses associated with defeasance, including, but not limited to, accountant's
fees and opinions of counsel, or (b) provide all opinions required under the
related loan documents, including, if applicable, a REMIC opinion and a
perfection opinion and any applicable rating agency letters confirming no
downgrade or qualification of ratings on any classes in the transaction.
Additionally, for any Mortgage Loan having a Cut-off Date Principal Balance
equal to or greater than $19,900,000, the Mortgage Loan or the related documents
require confirmation from the Rating Agency that exercise of the defeasance
option will not cause a
C-12
downgrade or withdrawal of the rating assigned to any securities backed by the
Mortgage Loan and require the Borrower to pay any Rating Agency fees and
expenses.
30. Fixed Rate Loans. Each Mortgage Loan bears interest at a rate that
remains fixed throughout the remaining term of such Mortgage Loan, except in the
case of an ARD Loan after its Anticipated Repayment Date and except for the
imposition of a default rate.
31. Inspection. Except as set forth on Schedule C-31, the Seller, an
affiliate of the Seller, or a correspondent in the conduit funding program of
the Seller, inspected, or caused the inspection of, each Mortgaged Property
securing a Mortgage Loan within twelve (12) months of the Closing Date.
32. No Material Default. To the Seller's knowledge, there exists no
material default, breach, violation or event of acceleration under the Mortgage
Note or Mortgage for any Mortgage Loan; provided, however, that this
representation and warranty does not cover any default, breach, violation or
event of acceleration that specifically pertains to or arises out of the subject
matter otherwise covered by any other representation and warranty made by the
Seller in this Exhibit C.
33. Due-on-Sale. The Mortgage for each Mortgage Loan contains a
"due-on-sale" clause, which provides for the acceleration of the payment of the
unpaid principal balance of such Mortgage Loan if, without the prior written
consent of the holder of such Mortgage, either the related Mortgaged Property,
or any direct controlling equity interest in the related Borrower, is
transferred or sold, other than by reason of: (i) if the related Mortgaged
Property is a residential cooperative property, transfers of stock of the
Borrower in connection with the assignment of a proprietary lease for an
apartment unit in the related Mortgaged Property by a tenant-shareholder of the
Borrower to other persons who by virtue of such transfers become
tenant-shareholders in the Borrower; and (ii) in the case of other types of
Mortgaged Properties, family and estate planning transfers, transfers of less
than a controlling interest in the Borrower, transfers of shares in public
companies, issuance of non-controlling new equity interests, transfers to an
affiliate meeting the requirements of the Mortgage Loan, transfers among
existing members, partners or shareholders in the Borrower, transfers among
affiliated Borrowers with respect to cross-collateralized Mortgaged Loans or
multi-property Mortgage Loans, transfers among co-Borrowers or transfers of a
similar nature to the foregoing meeting the requirements of the Mortgage Loan.
Except in the case where the related Mortgaged Property is a residential
cooperative property, the related Mortgage Loan Documents require the Borrower
under each Mortgage Loan to pay all reasonable fees and expenses associated with
securing the consent or approval of the holder of the related Mortgage for all
actions requiring such consent or approval under the related Mortgage, including
the cost of counsel opinions relating to REMIC or other securitization and tax
issues or require the payment of a specified fee or fees, including a 1%
assumption fee that would be applied to pay such fees and expenses.
34. Single Purpose Entity. Except in cases where the related Mortgaged
Property is a residential cooperative property and, further, except as otherwise
described on Schedule C-34 hereto, each Mortgage Loan with an original principal
balance over $5,000,000.00 requires the related Borrower to be, at least for so
long as the Mortgage Loan is outstanding, and to the Seller's actual knowledge,
the related Borrower is, a Single-Purpose Entity. For this purpose,
"Single-Purpose Entity" means a person, other than an individual, which is
formed or organized solely for the purpose of owning and operating the related
Mortgaged Property or Properties; does not engage in any business unrelated to
such
C-13
Mortgaged Property or Properties and the financing thereof; and whose
organizational documents provide, or which entity represented and covenanted in
the related Mortgage Loan Documents, substantially to the effect that such
Borrower (i) does not and will not have any material assets other than those
related to its interest in such Mortgaged Property or Properties or the
financing thereof; (ii) does not and will not have any indebtedness other than
as permitted by the related Mortgage or other related Mortgage Loan Documents;
(iii) maintains its own books, records and accounts, in each case which are
separate and apart from the books, records and accounts of any other person; and
(iv) holds itself out as being a legal entity, separate and apart from any other
person. In addition, each Mortgage Loan with a Cut-off Date Principal Balance of
$20,000,000 or more, except in cases where the related Mortgaged Property is a
residential cooperative property and, further, except as set forth on Schedule
C-34, the related Borrower's organizational documents provide substantially to
the effect that the Borrower shall: conduct business in its own name; not
guarantee or assume the debts or obligations of any other person; not commingle
its assets or funds with those of any other person; prepare separate tax returns
and financial statements, or if part of a consolidated group, be shown as a
separate member of such group; transact business with affiliates on an arm's
length basis; hold itself out as being a legal entity, separate and apart from
any other person, and such organizational documents further provide
substantially to the effect that: any dissolution and winding up or insolvency
filing for such entity is prohibited or requires the consent of an independent
director or member or the unanimous consent of all partners or members, as
applicable; such documents may not be amended with respect to the Single-Purpose
Entity requirements without the approval of the mortgagee or rating agencies;
the Borrower shall have an outside independent director or member. Except in
cases where the related Mortgaged Property is a residential cooperative
property, the Seller has obtained, with respect to each Mortgage Loan having a
Cut-off Date Principal Balance of $20,000,000 or more, in connection with its
origination or acquisition thereof, a counsel's opinion regarding
non-consolidation of the Borrower in any insolvency proceeding involving any
other party. To the Seller's actual knowledge, each Borrower has fully complied
with the requirements of the related Mortgage Note and Mortgage and the
Borrower's organizational documents regarding Single-Purpose-Entity status. The
organization documents of any Borrower on a Mortgage Loan having a Cut-off Date
Principal Balance of $20,000,000 or more that is a single member limited
liability company, provide that the Borrower shall not dissolve or liquidate
upon the bankruptcy, dissolution, liquidation or death of the sole member. Any
such single member limited liability company Borrower is organized in
jurisdictions that provide for such continued existence, and the Seller has
obtained, in connection with its origination or acquisition of the subject
Mortgage Loan, an opinion of such Borrower's counsel confirming such continued
existence and that the applicable law provides that creditors of the single
member may only attach the assets of the member including the membership
interests in the Borrower but not the assets of the Borrower.
35. Whole Loan. Each Mortgage Loan is a whole loan and not a
participation interest in a mortgage loan.
36. Tax Parcels. Except as described on Schedule C-36 of this
Agreement, 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 separate tax lots shall be effective
for the next tax year.
C-14
37. ARD Loans. Except as described on Schedule C-37, each Mortgage Loan
which is an ARD Loan commenced amortizing on its initial scheduled Due Date, and
provides that: (i) its Mortgage Rate will increase by at least two (2)
percentage points in connection with the passage of its Anticipated Repayment
Date; (ii) its Anticipated Repayment Date is not less than seven (7) years
following the origination of such Mortgage Loan; (iii) no later than the related
Anticipated Repayment Date, the related Borrower is required (if it has not
previously done so) to enter into a "lockbox agreement" whereby all revenue from
the related Mortgaged Property shall be deposited directly into a designated
account controlled by the Master Servicer; and (iv) any net cash flow from the
related Mortgaged Property that is applied to amortize such Mortgage Loan
following its Anticipated Repayment Date shall, to the extent such net cash flow
is in excess of the scheduled principal and interest payment payable therefrom,
be net of budgeted and discretionary (servicer approved) capital expenditures.
38. Security Interests. The security agreements, financing statements
or other instruments, if any, related to the Mortgage Loan establish and create,
and a UCC financing statement has been filed and/or recorded in all places
required by applicable law for the perfection of (to the extent that the filing
of such a UCC financing statement can perfect such a security interest), a valid
security interest in the personal property granted under such Mortgage (and any
related security agreement), which in all cases includes elevators and all
Borrower-owned furniture, fixtures and equipment material to the operation and
use of the Mortgaged Property as presently operated, and if such Mortgaged
Property is a hotel operated by the related Borrower, then such personal
property constitutes such portion of the material personal property required to
operate the Borrower's business as the Seller considered appropriate in light of
its underwriting standards; any security agreement, chattel mortgage or
equivalent document related to and delivered in connection with the Mortgage
Loan establishes and creates a valid and enforceable lien and security interest
on the property described therein (subject to the exceptions set forth in
Paragraph 13 above), which lien/security interest shall, in the case of (i)
elevators at all Mortgaged Properties having the same and (ii) all
Borrower-owned furniture, fixtures and equipment at Borrower operated hotel
properties, be a first priority lien/security interest except for certain
personal property subject to purchase money security interests and personal
property leases. In the case of any Mortgage Loan secured by a hotel, the
related loan documents contain such provisions as are necessary and UCC
Financing Statements have been filed as necessary, in each case, to perfect a
valid first priority security interest in the related revenues with respect to
such Mortgaged Property. An assignment of each UCC financing statement relating
to the Mortgage Loan has been executed by the Seller in blank which the
Purchaser or Trustee, as applicable, or its designee is authorized to complete
and to file in the filing office in which such financing statement was filed.
Each Mortgage Loan and the related Mortgage (along with any security agreement
and UCC financing statement), together with applicable state law, contain
customary and enforceable provisions such as to render the rights and remedies
of the holders thereof adequate for the practical realization against the
personal property described above, and the principal benefits of the security
intended to be provided thereby.
39. Disclosure to Environmental Insurer and Other Matters. If the
Mortgaged Property securing any Mortgage Loan is covered by a secured creditor
impaired property policy, then the Seller:
(a) has disclosed, or is aware that there has been disclosed, in the
application for such policy or otherwise to the insurer under such policy
the "pollution conditions" (as defined in
C-15
such policy) identified in any environmental reports related to such
Mortgaged Property which are in the Seller's possession or are otherwise
known to the Seller; and
(b) has delivered or caused to be delivered to the insurer under such
policy copies of all environmental reports in the Seller's possession
related to such Mortgaged Property;
in each case to the extent required by such policy or to the extent the failure
to make any such disclosure or deliver any such report would materially and
adversely affect the Purchaser's ability to recover under such policy. If the
Mortgaged Property securing any Mortgage Loan is covered by a secured creditor
impaired property policy, then: (x) all premiums for such insurance have been
paid; (y) such insurance is in full force and effect; and (z) (i) an
environmental report, a property condition report or an engineering report was
prepared that included an assessment for lead based paint ("LBP") (in the case
of a multifamily property built prior to 1978), asbestos containing materials
("ACM") (in the case of any property built prior to 1985) and radon gas ("RG")
(in the case of a multifamily property) at such Mortgaged Property and (ii) if
such report disclosed the existence of a material and adverse LBP, ACM or RG
environmental condition or circumstance affecting such Mortgaged Property, then,
except as otherwise described on Schedule C-39, (A) the related Borrower was
required to remediate such condition or circumstance prior to the closing of the
subject Mortgage Loan, or (B) the related Borrower was required to provide
additional security reasonably estimated to be adequate to cure such condition
or circumstance, or (C) the related Mortgage Loan documents require the related
Borrower to establish an operations and maintenance plan with respect to such
condition or circumstance after the closing of such Mortgage Loan. If the
Mortgage Loan is listed on Schedule C-12(EI) and the environmental insurance for
such Mortgage Loan is not a secured creditor policy but was required to be
obtained by the Borrower, then the holder of the Mortgage Loan is entitled to be
an additional insured under such policy, all premiums have been paid, such
insurance is in full force and effect and, to the Seller's knowledge, the
Borrower has made the disclosures and complied with the requirements of clauses
(a) and (b) of this Paragraph 39.
40. Prepayment Premiums and Yield Maintenance Charges. Prepayment
Premiums and Yield Maintenance Charges payable with respect to each Mortgage
Loan, if any, constitute "customary prepayment penalties" within meaning of
Treas. Reg. Section 1.860G-1(b)(2).
41. Operating Statements. Except for the Mortgage Loans with an initial
principal balance less than $3,000,000, which may only require annual
statements, and except as set forth on Schedule C-41, each Mortgage Loan
requires the Borrower, in some cases only at the request of the holder of the
related Mortgage, to provide the owner or holder of the related Mortgage with at
least quarterly and annual operating statements, rent rolls (if there is more
than one tenant) and related information (except in cases where the related
Mortgaged Property is a residential cooperative property) and annual financial
statements, which annual financial statements with respect to each Mortgage Loan
with an original principal balance greater than $20 million shall be audited (or
prepared and certified) by an independent certified public accountant upon the
request of the holder of the related Mortgage.
42. Servicing Rights. Except as set forth on Schedule C-42 or as
otherwise contemplated in this Agreement or the Pooling and Servicing Agreement,
no Person has been granted or conveyed the right to service any Mortgage Loan or
receive any consideration in connection therewith.
43. Recourse. Each Mortgage Loan (other than a Mortgage Loan secured by
a residential cooperative property) is non-recourse; provided that, except as
described on Schedule C-43
C-16
or for Mortgage Loans with a Cut-off Date Principal Balance of less than
$5,000,000, the Borrower and either a principal of the Borrower or other
individual guarantor, with assets other than any interest in the Borrower, is
liable in the event of (i) fraud or material misrepresentation, (ii)
misapplication or misappropriation of rents, insurance payments, condemnation
awards or tenant security deposits, (iii) violation of applicable environmental
laws or breaches of environmental covenants or (iv) the filing of a voluntary
bankruptcy or insolvency proceeding by the Borrower; and provided, further,
that, with respect to clause (iii) of the preceding proviso, an indemnification
against losses related to such violations or environmental insurance shall
satisfy such requirement. No waiver of liability for such non-recourse
exceptions has been granted to the Borrower or any such guarantor or principal
by the Seller or anyone acting on behalf of the Seller.
44. Assignment of Collateral. There is no material collateral securing
any Mortgage Loan that has not been assigned to the Purchaser.
45. Fee Simple or Leasehold Interests. The interest of the related
Borrower in the Mortgaged Property securing each Mortgage Loan includes a fee
simple and/or leasehold estate or interest in real property and the improvements
thereon.
46. Servicing. The servicing and collection practices used with respect
to each Mortgage Loan in all material respects have met customary standards
utilized by prudent commercial mortgage loan servicers with respect to whole
loans.
47. Originator's Authorization To Do Business. To the extent required
under applicable law, as of the Mortgage Loan's funding date and at all times
when it held such Mortgage Loan, the originator of each Mortgage Loan was
authorized to do business in the jurisdiction in which the related Mortgaged
Property is located, except where the failure to be so authorized does not
adversely affect the enforceability of such Mortgage Loan.
48. No Fraud In Origination. In the origination of the Mortgage Loan,
neither the originator nor any employee or agent of the Seller or the
originator, participated in any fraud or intentional material misrepresentation
with respect to the Borrower, the Mortgaged Property or any guarantor. To the
Seller's actual knowledge, no Borrower is guilty of defrauding or making an
intentional material misrepresentation to the Seller or originator with respect
to the origination of the Mortgage Loan, the Borrower or the Mortgaged Property.
49. Appraisal. In connection with its origination or acquisition of
each Mortgage Loan, the Seller obtained an appraisal of the related Mortgaged
Property, which appraisal is signed by an appraiser, who, to the Seller's actual
knowledge, had no interest, direct or indirect, in the Borrower, the Mortgaged
Property or in any loan made on the security of the Mortgaged Property, and
whose compensation is not affected by the approval or disapproval of the
Mortgage Loan; to the Seller's knowledge, the appraisal and appraiser both
satisfy the requirements of the "Uniform Standards of Professional Appraisal
Practice" as adopted by the Appraisal Standards Board of the Appraisal
Foundation, all as in effect on the date the Mortgage Loan was originated.
50. Jurisdiction of Organization. Each Borrower under a Mortgage Loan
was organized under the laws of the United States or the laws of a jurisdiction
located within the United States, its territories and possessions.
C-17
51. Borrower Concentration. Except as otherwise specified on Schedule
C-51, no single Borrower or group of affiliated Borrowers is/are the obligor(s)
under any one or more Mortgage Loans with a Cut-off Date Principal Balance of
$50,000,000 or more.
52. Escrows. All escrow deposits (including capital improvements and
environmental remediation reserves) relating to any Mortgage Loan that were
required to be delivered to the lender under the terms of the related Mortgage
Loan Documents, have been received and, to the extent of any remaining balances
of such escrow deposits, are in the possession or under the control of the
Seller or its agents (which shall include the Master Servicer). All such escrow
deposits which are required for the administration and servicing of such
Mortgage Loan are conveyed hereunder to the Purchaser.
53. Access. The Mortgaged Property securing each Mortgage Loan is
located on or adjacent to a public road, or has access to an irrevocable
easement permitting ingress and egress.
X-00
XXXXXXXX X-0
XXXX
X-00
XXXXXXXX C-7A
NONE
C-20
SCHEDULE C-7B
NONE
X-00
XXXXXXXX X-00(XX/XXX)
XXXX
X-00
XXXXXXXX X-00(XX)
107-38 Owners Corp.
000 Xxxxx Xxxxxx Housing Corporation
000 Xxxxxxx Xx. Housing Corp.
000 X. 00xx Owners Corp.
233 Court Housing Corp.
253259 Owners Corp.
264 President Apartment Corp.
279 Prospect Housing Corp.
000 Xxxxxxx Xx. Owners Corp.
000 0xx Xxxxxx Corp.
397 7th Housing Corp.
659 XxXxxx Housing Corp.
90 Sterling Place Owners Corp.
City Studios, Inc.
Xxxxx Housing Corporation
Xxxxxxxx Studios Corp.
Heights Owners Corp.
Three Twenty-Five Cooperative, Inc.
X-00
XXXXXXXX X-00(XX)
XXXX
X-00
XXXXXXXX C-12(OLD)
186 E. 2nd Owners Corp. a/k/a 186 East 2nd Owners Corp.
000 Xxxxxxx Xx. Housing Corp.
279 Prospect Housing Corp.
Xxxxxxxx Studios Corp.
Heights Owners Corp.
Three Twenty-Five Cooperative, Inc.
C-25
SCHEDULE C-12(MV)
NONE
C-26
SCHEDULE C-12(EI)
NONE
X-00
XXXXXXXX X-00(X)
XXXX
X-00
XXXXXXXX X-00(X)
NONE
C-29
SCHEDULE C-17
NONE
C-30
SCHEDULE C-18(I)
NONE
C-31
SCHEDULE C-21
The following loans require payments of interest only through maturity.
Principal payments are not required.
000 Xxxx 00xx Xxxxxx Corp.
00 Xxxxx Xxxxxx Owners Corp.
000 Xxxx Xxx Xxxxxx Xxxx.
Xxxxxx Xxxxx Xxxxx, Inc.
C-32
SCHEDULE C-23
184 Columbia Heights, Incorporated: $100,000 secured subordinate debt with a
6/1/11 maturity date.
000 Xxxx Xxxxxxx Xxxxxxx Owners Corp.: $1,295,000 secured subordinate debt with
a 5/1/11 maturity date.
000 Xxxx 00xx Xxxxxx Owners, Inc.: $500,000 secured subordinate debt with a
7/1/11 maturity date.
000 Xxxx 00xx Xx. Apartment Corp.: $500,000 secured subordinate debt with a
7/1/11 maturity date.
000 Xxxx 00xx Xxxxxx Corp.: $1,000,000 secured subordinate debt with a 8/1/11
maturity date.
00 Xxxxx Xxxxxx Owners Corp.: $300,000 secured subordinate debt with a 9/1/11
maturity date.
000 Xxxx Xxx Xxxxxx Corp.: $700,000 secured subordinate debt with a 10/1/11
maturity date.
000 Xxxx Xxx Owners Corp.: $500,000 secured subordinate debt with a 9/1/11
maturity date.
Xxxxxx Point North, Inc.: $1,000,000 secured subordinate debt with a 6/1/11
maturity date.
Cherry Lane Owners Corp.: $300,000 secured subordinate debt with a 10/1/11
maturity date.
X-00
XXXXXXXX X-00
XXXX
X-00
XXXXXXXX C-28A
NONE
C-35
SCHEDULE X-00X
XXXX
X-00
XXXXXXXX X-00
XXXX
X-00
SCHEDULE C-31
000 Xxxxxxx Xx. Housing Corp.: Inspection Report dated 11/13/00
279 Prospect Housing Corp.: Inspection Report dated 10/24/00
Heights Owners Corp.: Inspection Report dated 07/07/00
C-38
SCHEDULE X-00
XXXX
X-00
XXXXXXXX X-00
XXXX
X-00
SCHEDULE C-37
NONE
C-41
SCHEDULE X-00
XXXX
X-00
XXXXXXXX X-00
XXXX
X-00
SCHEDULE X-00
X-00
XXXXXXXX X-00
XXXX
X-00
XXXXXXXX X-00
XXXX
X-00
XXXXXXX X-0X
FORM OF CERTIFICATE OF THE SECRETARY
OR AN ASSISTANT SECRETARY OF THE SELLER
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
COMMERCIAL MORTGAGE PASS-THROUGH
CERTIFICATES SERIES 2001-CKN5
NATIONAL CONSUMER COOPERATIVE BANK
OFFICER'S CERTIFICATE
I, Xxxxxx X. Xxxxxxxx, hereby certify that I am a duly elected Managing
Director/Vice-President of National Consumer Cooperative Bank, a corporation
chartered by an act of the United States Congress (the "NCCB"), and further as
follows:
1. Attached hereto is a true and correct copy of each of the charter
and bylaws of NCCB, both of which are in full force and effect on the date
hereof.
2. Each person who, as an officer or representative of NCCB, signed the
(i) Pooling and Servicing Agreement (the "POOLING AGREEMENT"), dated as of
November 12, 2001, between Credit Suisse First Boston Mortgage Securities Corp.,
as depositor, KeyCorp Real Estate Capital Markets, Inc., d/b/a Key Commercial
Mortgage, as general master servicer, National Consumer Cooperative Bank, as
coop master servicer and coop special servicer, and Xxxxx Fargo Bank Minnesota,
N.A., as trustee, (ii) Mortgage Loan Purchase Agreement (the "MLPA"), dated as
of November 1, 2001, between Credit Suisse First Boston Mortgage Securities
Corp., as purchaser, and NCCB, as seller, (iii) Mortgage Loan Seller
Indemnification Agreement (the "INDEMNIFICATION AGREEMENT"), dated as of
November 1, 2001 between NCCB, Credit Suisse First Boston Mortgage Securities
Corp. and Credit Suisse First Boston Corporation and (iv) the two (2) Guaranty
agreements (collectively, the "GUARANTY") dated as of November 1, 2001, each
entered into in connection with the issuance of Credit Suisse First Boston
Mortgage Securities Corp. Commercial Mortgage Pass-Through Certificates Series
2001-CKN5 (the Pooling Agreement, MLPA, Indemnification Agreement and Guaranty
are referred to herein, collectively, as the "AGREEMENTS"), and any other
document delivered prior hereto or on the date hereof in connection with the
Agreements, was, at the respective times of such signing and delivery, and is
now duly elected or appointed, qualified and acting as such officer or
representative, and the signatures of such persons appearing on such documents
are their genuine signatures.
3. Attached hereto is a true copy of resolutions of the Board of
Directors of NCCB which has not been amended or rescinded but remain in full
force and effect on the date hereof.
D-1A-1
IN WITNESS WHEREOF, I have hereunto signed my name this 13th day of
November, 2001.
---------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Managing Director/Vice-President
I, ______________________________, a[n] [Assistant] Secretary
of NCCB, hereby certify that Xxxxxx X. Xxxxxxxx is a duly elected, qualified and
acting Managing Director/Vice-President of NCCB and that the signature appearing
above is his genuine signature.
IN WITNESS WHEREOF, I have hereunto signed my name this 13th
day of November, 2001.
---------------------------
Name:
Title:
D-1A-2
EXHIBIT D-1B
FORM OF CERTIFICATE OF THE SELLER
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2001-CKN5
CERTIFICATE OF NATIONAL CONSUMER COOPERATIVE BANK
In connection with the execution and delivery by National Consumer
Cooperative Bank ("NCB") of, and the consummation of the various transactions
contemplated by, that certain Mortgage Loan Purchase Agreement dated as of
November 1, 2001 (the "Mortgage Loan Purchase Agreement"), between Credit Suisse
First Boston Mortgage Securities Corp. ("CSFBMSC"), as purchaser, and NCB, as
seller, and that certain Indemnification Agreement dated as of November 1, 2001
(the "Indemnification Agreement" and, together with the Mortgage Loan Purchase
Agreement, the "Agreements"), between NCB, CSFBMSC and Credit Suisse First
Boston Corporation, as representative of the Underwriters and as initial
purchaser of the Privately Offered Certificates, the undersigned hereby
certifies that (i) the representations and warranties of NCB in the Agreements
are true and correct in all material respects at and as of the date hereof with
the same effect as if made on the date hereof, and (ii) NCB has, in all material
respects, complied with all the agreements and satisfied all the conditions on
its part required under the Mortgage Loan Purchase Agreement to be performed or
satisfied at or prior to the date hereof. Capitalized terms used but not defined
herein shall have the respective meanings assigned to them in the Mortgage Loan
Purchase Agreement.
Certified this ______ day of November, 2001.
NATIONAL CONSUMER COOPERATIVE BANK
By:
-------------------------------
Name:
Title:
D-1B-1
EXHIBIT D-2A
FORM OF OPINION OF XXXXXXXX XXXXXXXXX XXXXXX XXXXXXXX & XXXXXX LLP,
PURSUANT TO SECTION 7(VII)
November 13, 2001
Credit Suisse First Boston Mortgage Xxxxx Fargo Bank Minnesota, N.A.
Securities Corp. 00000 Xxxxxx Xxxx Xxxxxxx
00 Xxxxxxx Xxxxxx Xxxxxxxx, Xxxxxxxx 00000
Xxx Xxxx, Xxx Xxxx 00000
Credit Suisse First Boston Corporation Xxxxx'x Investors Service, Inc.
00 Xxxxxxx Xxxxxx 00 Xxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000 Xxx Xxxx, Xxx Xxxx 00000
Xxxxxx Brothers Inc. Standard and Poor's Rating Services
101 Xxxxxx 00 Xxxxx Xxxxxx
Xxxxxx Xxxx, Xxx Xxxxxx 00000 Xxx Xxxx, Xxx Xxxx 00000
McDonald Investments, Inc.
000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000
Re: (I) Mortgage Loan Purchase Agreement (the "MLPA") dated as of
November 1, 2001, between ---- National Consumer Cooperative
Bank, as seller, and Credit Suisse First Boston Mortgage
Securities Corp., as purchaser, (II) Pooling and Servicing
Agreement (the "PSA"), dated as of --- November 12, 2001, among
Credit Suisse First Boston Mortgage Securities Corp., KeyCorp
Real Estate Capital Markets, Inc., d/b/a Key Commercial Mortgage,
National Consumer Cooperative Bank and Xxxxx Fargo Bank
Minnesota, N.A., (III) the Guaranty dated as of November 1, 2001,
executed by National Consumer Cooperative Bank (regarding the
guarantee of certain buyback obligations) and (IV) the Guaranty
dated as of November 1, 2001, executed by National Consumer
Cooperative Bank (regarding the guarantee of certain
indemnifications obligations) (documents I-IV, collectively, the
"Agreements")
Dear Sirs:
We have acted as counsel to National Consumer Cooperative Bank ("NCCB")
in connection with its execution and delivery of the Agreements. Capitalized
terms not otherwise defined herein shall have the respective meanings ascribed
thereto in the PSA.
We have examined copies of the following documents:
1. the Agreements;
D-2A-1
2. the National Consumer Cooperative Bank Act (12 U.S.C. 3001 et
seq., Pub. L. 95-351), as amended (the "Act");
3. the officer's certificate delivered pursuant to the MLPA (the
"NCCB Certificate");
4. Mortgage Loan Seller Indemnification Agreement (the
"Indemnification Agreement"), dated as of November 1, 2001between
National Consumer Cooperative Bank, Credit Suisse First Boston
Mortgage Securities Corp., and Credit Suisse First Boston Corporation;
and
5. such other documents, records, certificates and papers as we
have deemed necessary and relevant as a basis for this opinion.
To the extent we have deemed necessary and proper regarding matters of
fact, we have, with your approval, relied upon the Act, the certificate of NCCB
delivered to us in connection with this opinion and on the representations and
warranties of NCCB contained therein, in the Agreements, in the Indemnification
Agreement, in the NCCB Certificate and in all other instruments, certificates,
and agreements executed by or on behalf of NCCB in connection with the subject
transaction, and we have, with your approval, assumed the accuracy of such
representations and warranties set forth, an assumption which we have not
independently verified. The opinions set forth herein are based solely upon the
state of the law and facts existing as of the date hereof.
In rendering the opinions below, we have assumed with your permission
(i) the due, proper, authorized and complete execution and delivery of all
instruments referred to above and to the instruments referred to therein
(collectively, the "Documents") by all parties other than NCCB, and that the
Documents are valid, binding and enforceable in accordance with their respective
terms against such other parties, (ii) the authenticity of all documents
submitted to us as originals, (iii) the conformity to original documents of all
documents submitted to us as copies, (iv) the authenticity of the original of
each document submitted to us as a copy, (v) that all documents submitted to us
are complete and the signatures thereon (other than with respect to NCCB) are
genuine, (vi) that there are no other agreements or understandings among the
parties that modify the terms of the Documents or the respective rights or
obligations of the parties to the Documents, (vii) that there has been no mutual
mistake of fact with respect to the Documents or the transactions contemplated
thereunder, and (viii) that you have not received notice of defects, defenses,
claims or other material information which would impact on the below opinions.
Based upon and subject to the foregoing, we are of the opinion that:
(1) NCCB is a corporation chartered by an act of the United States
Congress, is duly organized, validly existing and in good standing under the
laws of the United States and is qualified to transact business in, and is in
good standing under the laws of, the State of New York or is otherwise exempt
from such qualification.
(2) NCCB has the corporate power and authority to engage in the
transactions contemplated by the Agreements and the Indemnification Agreement,
and all requisite corporate power and authority to execute and deliver the
Agreements and the Indemnification Agreement and to perform and observe the
terms and conditions thereof.
D-2A-2
(3) The Agreements and the Indemnification Agreement and the
consummation by NCCB of the transactions contemplated by the Agreements and the
Indemnification Agreement have been duly authorized by NCCB, and the Agreements
and the Indemnification Agreement have been duly executed and delivered by NCCB.
(4) The Agreements are legal, valid and binding agreements enforceable
against NCCB in accordance with their respective terms. This opinion regarding
the legality, validity, binding effect and enforceability of the Agreements
means that (a) the Agreements constitute effective contracts under applicable
law and (b) the Agreements are not invalid in their entirety because of a
specific statutory prohibition or public policy, nor are the Agreements subject
in their entirety to contractual defenses arising out of the terms of the
Agreements. However, this opinion does not mean that any particular remedy for
which provision is made in the Agreements will be available upon a material
default, or that every provision of the Agreements will be upheld or enforced in
any particular circumstance by a court, but, subject to the qualifications and
assumptions set forth herein, such unavailability or unenforceability will not
substantially interfere with realization of the practical benefits and/or
security provided thereby. Furthermore, the validity, binding effect and
enforceability of the Agreements may be limited or otherwise affected by the
matters described below.
(5) The Agreements and the Indemnification Agreement and the
consummation by NCCB of the transactions contemplated by the Agreements and the
Indemnification Agreement do not conflict with or result in a breach or
violation of any material term or provision of, or constitute a default under,
the organizational documents of NCCB or any New York state or federal statute or
federal law or regulation applicable to NCCB. To the best of our knowledge,
without independent inquiry, the Agreements and the Indemnification Agreement
and the consummation by NCCB of the transactions contemplated by the Agreements
and the Indemnification Agreement do not conflict with or result in a breach or
violation of any material term or provision of, or constitute a default under,
any indenture or other agreement or instrument to which NCCB is a party or by
which it is bound, or any order of any state or federal court, regulatory body,
administrative agency or governmental body having jurisdiction over NCCB
(6) To the best of our knowledge, no consent, approval, authorization
or order of any New York state or federal court or governmental agency or body
is required for the consummation by NCCB of the transactions contemplated by the
terms of the Agreements or the Indemnification Agreement.
(7) To the best of our knowledge, without independent inquiry, there
are no actions, suits, proceedings or investigations pending or threatened
against or affecting NCCB which, if adversely determined, individually or in the
aggregate, would materially adversely affect NCCB's ability to perform its
obligations under the Agreements or the Indemnification Agreement.
Without limiting the qualifications set forth herein, we express no
opinion as to (i) title to the real or personal property described in and
encumbered by the respective Mortgage Loan Documents relating to the Mortgage
Loans, and this opinion in no way relates to the title of the mortgagors
thereunder or to the perfection or priority of the lien attempted to be granted
by the Mortgage Loan Documents or the effect of the due recording of such
Mortgage Loan Documents or the failure to cause such Mortgage Loan Documents to
be recorded, (ii) the perfection or priority of any lien or security interest,
(iii) compliance or non-compliance by NCCB or any other person or entity with
federal or state
D-2A-3
securities laws (including, without limitation, the Securities Act of 1933, the
Trust Indenture Act of 1939 and the Investment Company Act of 1940) or (iv) the
classification and treatment of the Mortgage Loans and any proceeds therefrom
for purposes of federal and state income tax matters.
The opinions expressed above are subject to the following
qualifications in addition to those set forth herein:
A. the enforceability of the Agreements in accordance with their
respective terms is subject to applicable bankruptcy, insolvency,
reorganization, moratorium, or other similar laws affecting creditors'
rights generally; the enforceability of the Agreements in accordance with
their terms is subject to general principles of equity (whether or not such
enforceability is considered in a proceeding in equity or at law);
B. the enforceability of the Agreements in accordance with their
respective terms may be limited by the effect of standards of good faith,
fair dealing and reasonableness which may be applied by a court to the
exercise of certain rights and remedies;
C. our opinions, as they relate to the enforceability of rights to
indemnify, may be limited by state or federal laws or the public policy
underlying such laws;
D. we express no opinion as to the enforceability of any provisions in
the Agreements purporting to restrict access to legal or equitable
remedies, to establish evidentiary standards, to waive defenses, to waive
or modify service of process requirements under applicable laws, or to
control the determination of venue for any legal or equitable proceedings
that may arise in connection therewith; and
E. we express no opinion as to the validity or binding effect or the
enforceability of any provision in the Agreements which purports to require
payment of interest after default at a rate in excess of a rate which a
court would determine under applicable law to be commercially reasonable
and not a penalty.
We are members of the Bar of the State of New York. The foregoing
opinion is limited to the laws of the State of New York and, as to matters of
federal jurisprudence, the laws of the United States of America. In rendering
our opinion, we have not considered, and hereby disclaim any opinion as to, the
application or impact of any other laws, cases, decisions, rules or regulations
of any other jurisdiction, court or administrative agency, and the opinions
expressed herein do not encompass any matters related to or implicated by, or
the enforcement of any remedies in, any other country or jurisdiction.
[Remainder of this page intentionally left blank]
D-2A-4
This opinion letter is furnished to you solely for your benefit and for
the benefit of your successors and assigns, and may not be relied upon by, nor
may copies be delivered to, any other person or entity without our prior written
consent. Finally, we do not undertake to advise you of any changes in the
opinions expressed herein resulting from matters that might hereafter come or be
brought to our attention.
Very truly yours,
D-2A-5
EXHIBIT D-2B
FORM OF OPINION OF XXXXXXXX XXXXXXXXX XXXXXX XXXXXXXX & XXXXXX LLP,
PURSUANT TO SECTION 7(VIII)
November 13, 2001
Fitch, Inc. McDonald Investments, Inc.
Xxx Xxxxx Xxxxxx 000 Xxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000 Xxxxxxxxx, Xxxx 00000
Standard and Poor's Ratings Services Xxxxx Fargo Bank Minnesota, N.A.
00 Xxxxx Xxxxxx 11000 Broken Xxxx Xxxxxxx
Xxx Xxxx, Xxx Xxxx 00000 Xxxxxxxx, Xxxxxxxx 00000
Credit Suisse First Boston Mortgage Xxxxxx Brothers Inc.
Securities Corp. 101 Xxxxxx
00 Xxxxxxx Xxxxxx Xxxxxx Xxxx, Xxx Xxxxxx 00000
Xxx Xxxx, Xxx Xxxx 00000
Credit Suisse First Boston Corporation
00 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Mortgage Loan Purchase Agreement between National Consumer
Cooperative Bank and Credit Suisse First Boston Mortgage
Securities Corp. dated as of November 1, 2001
Dear Sirs:
We have acted as counsel to National Consumer Cooperative Bank ("NCCB"
or the "Bank") with respect to (i) a Mortgage Loan Purchase Agreement (the
"MLPA" or the "Agreement") between NCCB and Credit Suisse First Boston Mortgage
Securities Corp. ("CSFB" or the "Purchaser"), dated as of November 1, 2001 and
(ii) a Pooling and Servicing Agreement (the "Pooling Agreement") between NCCB,
CSFB, KeyCorp Real Estate Capital Markets, Inc., ORIX Real Estate Capital
Markets, LLC and Xxxxx Fargo Bank Minnesota, N.A. dated as of November 12, 2001.
Any capitalized terms which are not expressly defined herein shall have the
meaning ascribed to them in the MLPA or the Pooling Agreement.
Pursuant to the MLPA, NCCB has agreed to sell, and CSFB has agreed to
purchase, certain mortgage loans specified therein (the "Mortgage Loans" or the
"NCCB Loans"). The MLPA provides that upon payment of the purchase price set
forth therein title to the NCCB Loans shall pass to CSFB. The consideration
payable to NCCB for the Mortgage Loans consists of (i) cash and (ii) all of the
Class A-Y Certificates issued pursuant to the Pooling Agreement. The Class A-Y
Certificates bear
D-2B-1
interest at a rate, and based upon a notional amount, as more
particularly described in the Pooling Agreement.
Concurrently with the execution of the MLPA and the Pooling Agreement,
CSFB, as depositor, will transfer the NCCB Loans into a trust established under
the Pooling Agreement for the benefit of the holders of a series of pass-through
certificates to be issued pursuant to the Pooling Agreement.
The Pooling Agreement provides that NCCB is to act as master servicer
and special servicer for certain of the NCCB Loans (in these capacities, NCCB
will be referred to herein as the "Coop Master Servicer" and "Coop Special
Servicer"; and the NCCB Loans that are to be serviced by NCCB, either as Coop
Master Servicer or Coop Special Servicer, will be referred to herein,
collectively, as the "NCCB Coop Loans"). NCCB's Servicing Fee as Coop Master
Servicer will be payable monthly on a loan-by-loan basis from interest received,
will accrue at a rate of 0.10% per annum, and will be computed on the same basis
as the related NCCB Coop Loan on the Stated Principal Balance of such NCCB Coop
Loan. Additional servicing compensation in the form of (i) any and all Net
Default Charges accrued with respect to a Performing Mortgage Loan, (ii) 50% of
any and all Net Assumption Application Fees, Net Application Fees, modification
fees, extension fees, consent fees, waiver fees and fees paid in connection with
defeasance, (iii) any and all charges for beneficiary statements or demands,
amounts collected for checks returned for insufficient funds and other loan
processing fees, (iv) any and all Prepayment Interest Excesses and (v) other
customary charges, in each case only to the extent actually paid by the related
Borrower, shall be retained by NCCB in its capacity as Coop Master Servicer.
NCCB as Coop Special Servicer shall receive, among other compensation,
a Special Servicing Fee with respect to each Specially Serviced Loan at a rate
of 0.25% per annum computed on the same basis as the related NCCB Coop Loan on
the Stated Principal Balance of such NCCB Coop Loan.
Neither the MLPA nor the Pooling Agreement provides for a termination,
revocation or avoidance of any transfer of the NCCB Loans by NCCB to CSFB or
provides for the retention by NCCB of any interest whatsoever in the NCCB Loans,
except that, in the event that there exists any Material Document Defect or
Material Breach with respect to any NCCB Loan, NCCB is required , pursuant to
the terms of the MLPA and Pooling Agreement, to cure such Material Document
Defect or Material Breach or repurchase such NCCB Loan at the Purchase Price.
You have requested our opinion as to whether, in a case under the
United States Bankruptcy Code (Title 11, U.S.C.) in which the Bank is the
debtor, a court would hold that the transfer of the Mortgage Loans by the Bank
to the Purchaser in the manner set forth in the Agreement would constitute an
absolute transfer of the Mortgage Loans, rather than a borrowing by the Bank
secured by the Mortgage Loans.
We have assumed that the Bank is eligible to be a debtor in a case
under the Bankruptcy Code. This opinion is based solely upon the documents
described in this opinion and our examination of such matters of law as we have
deemed necessary for purposes of rendering the opinions set forth herein.
We have examined copies of the following documents:
D-2B-2
1. the MLPA;
2. the Pooling Agreement; and
3. such other documents, records, certificates and papers as we have
deemed necessary and relevant as a basis for this opinion.
To the extent we have deemed necessary and proper regarding matters of
fact not within our knowledge, we have relied without independent investigation
upon representations and warranties contained in the certificate of an officer
of the Bank provided to us, and in the MLPA, the Pooling Agreement and in all
other instruments, certificates, and agreements executed by or on behalf of NCCB
in connection with the subject transaction. The opinions set forth herein are
based solely upon the state of the law and facts existing as of the date hereof.
In rendering the opinions below, we have assumed (i) the due, proper,
authorized and complete execution and delivery of all instruments referred to
above and to the instruments referred to therein (collectively, the "Documents")
by all parties other than NCCB, and that the Documents are valid, binding and
enforceable in accordance with their respective terms against such other
parties; (ii) the genuineness of all signatures on the Documents, except those
on behalf of NCCB; (iii) that all copies of the Documents conform to the
originals thereof; (iv) that all Documents which were to have been recorded were
properly recorded and the title policies issued in connection therewith, if any,
properly reflect all recording information and the correct status of the matters
set forth therein and that all required mortgage taxes and recording charges
have been paid in full; and (v) that you have not received notice of defects,
defenses, claims or other material information which would impact on the below
opinions.
We have not examined the Mortgage Loan Documents, and we express no
opinion concerning the conformity of any of the Mortgage Loan Documents to the
requirements of the MLPA.
Based on the considerations set forth above, we have assumed the
following, without investigation:
A. The Bank will have been the sole owner of the Mortgage Loans with
full right and authority to sell the same, free and clear of any and all
pledges, liens, security interests, claims, participation interests or other
equities or encumbrances of any nature.
B. Each Mortgage Note will have been endorsed in a manner which
satisfies any requirement of endorsement in order to transfer all right, title
and interest of the party so endorsing, as noteholder or assignee thereof, in
and to that Mortgage Note. Each assignment of a Mortgage will be in recordable
form and will be sufficient to effect the assignment of and transfer to the
assignee thereunder the benefits of the assignor, as mortgagee or assignee
thereof, under each Mortgage to which such assignment relates.
C. No Mortgage Loan Document will reflect any interest which is
inconsistent with the sale and transfer of the Mortgage Loans by the Bank to the
Purchaser as provided in the MLPA.
D-2B-3
D. The amount of the consideration received by the Bank upon the sale
of the Mortgage Loans to the Purchaser pursuant to the MLPA constituted
reasonably equivalent value and fair consideration for the Mortgage Loans sold,
being fair market value arrived at on an arm's length basis.
E. No fraud, mistake, breach of covenant or illegality on the part of
any party to the MLPA affecting any Mortgage Loan or otherwise in connection
with any transaction contemplated by the MLPA will have occurred.
F. No party to the MLPA has taken or will have taken prior to the
Closing Date any action which is unreasonable, arbitrary or capricious, or which
has not been in good faith or in a commercially reasonable manner, in enforcing
or attempting to enforce or performing or attempting to perform any of its
rights or obligations under any Mortgage Loan or the MLPA or the Pooling
Agreement.
G. The MLPA, the Pooling Agreement and all related documents evidence
the intention by the Bank and the Purchaser to effectuate an absolute transfer
of the Mortgage Loans. There is not, and will not be, any other agreement
between or among the Bank and the Purchaser, that supplements or otherwise
modifies the intention of such parties, as expressed in the MLPA and the Pooling
Agreement, and the agreements specifically referred to therein.
H. The Bank has an appropriate business reason for selling the Mortgage
Loans, as provided in the MLPA and the Pooling Agreement, rather than obtaining
a secured loan with the Mortgage Loans as collateral.
I. The Bank will not have any right to modify or alter the terms of the
sale of the Mortgage Loans to the Purchaser.
J. The price to be paid for the Mortgage Loans by the Purchaser to the
Bank will be paid in full at the time of the sale pursuant to the MLPA, and no
agreement or arrangement will exist which permits the modification of the
consideration for the Mortgage Loans subsequent to the date of the sale. The
Bank will have no right or obligation to repurchase any Mortgage Loan after such
sale, except: (i) in the event of a Material Document Defect or Material Breach
with respect to a Mortgage Loan, the Bank will be required, pursuant to the
terms of the MLPA and the Pooling Agreement, to cure or repurchase such Mortgage
Loan; (ii) in the event that an NCCB Coop Loan becomes a Specially Designated
Defaulted Mortgage Loan, the Bank as Coop Special Servicer will have the right
but not the obligation to purchase such loan; and (iii) the Bank may, at its
option, elect to purchase all of the Loans and each REO Property remaining in
the Trust Fund by giving written notice to the Trustee and the other parties to
the Pooling Agreement within 60 days prior to the anticipated date of purchase
provided that the aggregate Stated Principal Balances of the Mortgage Pool is
less that 1.00% of the Initial Pool Balance.
K. Under generally accepted accounting principles, the Bank will report
its transfer of the Mortgage Loans to the Purchaser, pursuant to the MLPA, as a
sale of all its right, title and interest in and to the Mortgage Loans
(excluding only its right to collect the Master Servicing Fee and the Special
Servicing Fee, if appropriate). The Bank also will so report the transfer in all
filings and reports with any applicable regulatory agencies. For federal income
tax purposes, the Bank will treat the transfer of the Mortgage Loans to the
Purchaser as a sale of all its right, title and interest in and to the
D-2B-4
Mortgage Loans (excluding only its right to collect the Master Servicing Fee and
the Special Servicing Fee, if appropriate).
L. The Bank will take no action which is inconsistent with the
Purchaser's ownership of the Mortgage Loans.
M. As reflected in the MLPA and the Pooling Agreement, the Bank intends
to relinquish, in the sale of the Mortgage Loans, all rights to possess, control
and monitor the Mortgage Loans, except to the extent necessary to facilitate the
performance of its obligations in its capacity as Coop Master Servicer or Coop
Special Servicer with respect to the NCCB Coop Loans under the MLPA, and except
with respect to its right to collect the Master Servicing Fee and the Special
Servicing Fee. Promptly after the closing date, there will be filed in the
appropriate recording offices, the assignments of the Mortgages by the Bank to
the Purchaser, as and to the extent required under the MLPA. The respective
obligations of the Bank and the Purchaser under the MLPA will be customary in
the industry for the type of transaction contemplated. The Master Servicing Fee
to be paid to the Coop Master Servicer is substantially equivalent to fees
currently charged for providing comparable services to the industry, and
constitutes adequate compensation which would fairly compensate a substitute
servicer should one be required, including the profit which would be demanded in
the marketplace. Under the Pooling Agreement, the Coop Master Servicer may be
terminated as Coop Master Servicer and a substitute servicer may be appointed
upon the happening of an event of default or certain other specified events.
N. The Bank will have no obligation to the Purchaser with respect to
the Mortgage Loans except for the obligations of the Bank under the MLPA, and as
Coop Master Servicer and Coop Special Servicer under the Pooling Agreement, and
the Purchaser has no other recourse or right of chargeback to the Bank with
respect to the Mortgage Loans.
SALE ANALYSIS
In considering the opinions expressed below, it should be understood
that, to our knowledge, there is no directly controlling statute or regulation
or judicial precedent. In addition, certain judicial decisions which we have
examined may be viewed as inconsistent with those opinions. Furthermore, in
determining whether a sale would be characterized as a sale or a loan, courts
have expressed divergent views on both the nature of the inquiry that a court
should make as well as the significance of a variety of factual elements.
In making a determination of whether the transfer of rights to payment,
such as notes secured by real property, is an absolute sale or a secured
borrowing, courts have examined "all the facts and circumstances surrounding the
transactions at issue." In re Golden Plan, 829 F.2d 705, 709 (9th Cir. 1986).
Accord, Major's Furniture Mart v. Castle Credit Corp., 602 F.2d 538, 544 (3rd
Cir. 1979). The courts which have addressed this issue have weighed a number of
factors in reaching their decisions, including the transfer of the risk of loss,
the transfer of the opportunity for gain, the manner in which the interest rate
received by the transferee is determined, the intent of the parties, the form of
the transaction, whether the transferor continues to service the transferred
loans, and whether the transfer is recorded.
Of these various factors, one of the most important is the transfer of
the risk of loss; that is, whether the credit risk that the notes will not be
paid by the obligors has been shifted from the transferor of the notes to the
transferee. See, e.g., In re The Xxxxxxx Co., 813 X.0x 000, 000-00 (0xx
X-0X-0
Cir. 1987); Golden Plan, 829 F.2d at 709-10; Major's Furniture Mart, 602 F.2d at
545; XxXxx v. Western Plains Corp., 823 F.2d 1395, 1399 (10th Cir. 1987).
Courts have held that the risk of loss is not shifted to the transferee
if the transferee has full recourse to the transferor in the event the obligors
on the notes fail to make the required payments. E.g., Xxxxxxx Co.; Major's
Furniture Mart; In re Executive Growth Investments, 40 B.R. 417 (Bankr. C.D.
Cal. 1984). In certain circumstances, limited recourse, if such limited recourse
is substantial, has been held to mean that the risk of loss has not been
shifted. E.g., In re S.O.A.W. Enterprises, 32 B.R. 279 (Bankr. W.D. Tex. 1983)
(70% recourse with guaranties); In re Hurricane Elkhorn Coal Corp. II, 19 B.R.
69 (Bankr. W.D. Ky. 1982) (20% recourse), aff'd in part & rev'd in part, 32 B.R.
737 (W.D. Ky. 1983), aff'd, 763 F.2d 188 (6th Cir. 1985).
The MLPA transfers the Bank's interests in the Mortgage Loans to the
Purchaser without recourse to the Bank. As discussed below, if obligors on the
Mortgage Loans fail to make the required payments, any resulting losses will be
borne ultimately by the Certificateholders, not the Bank. In similar
circumstances, the courts have found that the transferor no longer bears the
risk of loss. E.g., Golden Plan.
The Bank does have certain limited obligations with respect to the
Mortgage Loans, but these obligations should not be significant enough to
conclude that the risk of loss remains with the Bank. The Bank is obligated to
repurchase Mortgage Loans which, in breach of the Bank's representations and
warranties, do not have specified attributes. This obligation is designed to
ensure that the Mortgage Loans in fact have the attributes which the Bank, as
seller, represented they have. This obligation does not relate to defaults by
the obligors. Accordingly, the repurchase obligations of the Bank should not be
significant enough to conclude that the risk of loss remains with the Bank. But
see XxXxx, 832 F.2d at 1398-99 (required repurchases of mortgages may in certain
unspecified circumstances indicate that the risk of loss remained with
transferor and that the transaction is not an absolute sale).
In addition, in certain limited circumstances, the Bank, in its
capacity as Coop Master Servicer, is required to advance funds (a) so that the
Certificateholders will not suffer an interruption in anticipated distributions
on the Certificates and (b) to pay certain collection expenses. These advances
will be made only if the Coop Master Servicer believes that it will be
reimbursed from specified future collections on the NCCB Coop Loans. The Coop
Master Servicer's right to reimbursement has priority over payments to the
Certificateholders. These advances do not constitute a form of recourse, but
rather affect merely the timing of distributions to the Certificateholders.
Thus, if there are any losses, they will ultimately be borne by the
Certificateholders, not the Coop Master Servicer. See also Golden Plan, 829 F.2d
at 709-10 (advances consistent with outright sale).
A second important factor considered by the courts is whether the
opportunity for gain or loss, that is, the risk that the value of the
obligations transferred will fluctuate due to changes in the market, has been
shifted from the transferor to the transferee. If the opportunity for gain or
loss has been so shifted, the transaction is more likely to be characterized as
an absolute sale. See, e.g., In re Xxxxxxxx Aircraft Corp. (56 B.R. 339, 374-76
(Bankr. D. Minn. 1985) (aircraft), aff'd on this ground & rev'd on others, 850
F.2d 1975 (8th Cir. 1988).
The Bank has no interest in the Mortgage Loans, except in its role as
Coop Master Servicer and Coop Special Servicer. Furthermore, the Bank has no
right to obtain the return of the
D-2B-6
Mortgage Loans except pursuant to the limited repurchase obligations described
above. Accordingly, any change in the market value of the Mortgage Loans will
not be for the benefit or detriment of the Bank.
A third important consideration is the manner in which the interest
rate received by the transferee is determined. Xxxxxxx, 813 F.2d at 272. In
Xxxxxxx, the court ruled the transfer of mortgage notes was a secured borrowing
because, inter alia, the interest rate received by the transferees varied by
between one and six percent from the rate on the mortgage notes, and the
transferees' interest rate was based on the rate at which the transferor could
borrow funds. 813 F.2d at 272. See also S.O.A.W. Enterprises, 32 B.R. at 282
(secured loan where inter alia transferees received an interest rate higher than
that on transferred mortgage notes). Here, the Certificateholders will receive
all interest payments made on the Mortgage Loans, except that a reasonable
servicing fee will be paid to the Bank as compensation for servicing the NCCB
Coop Loans, as discussed above. (The Bank, as Coop Master Servicer, will also
receive certain additional charges under the NCCB Coop Loans, as additional
servicing compensation.) The interest rates on the Mortgage Loans are based on
the current market rates for comparable mortgage loans at the time of
origination of such Mortgage Loans. The rate of return on each Mortgage Loan is
not based on the rate at which the Bank could obtain a secured loan.
A fourth important factor is the form of the transaction. While
substance is more important than form, Major's Furniture Mart, 602 F.2d at 543,
the courts, particularly in the area of assignment of mortgages, have looked
closely at the form of the transaction. See, e.g., Golden Plan, 829 F.2d at 709;
In re Columbia Pacific Mortgage, 20 B.R. 259 (Bankr. W.D. Wash. 1981); In re
Lemons Associates, Inc., 67 B.R. 198 (Bankr. D. Nev. 1986). See also In re
Xxxxxx, Xxxxxxx & Xxxxxxxx Asset Management Corp., 67 B.R. 557, 596-98 (D.N.J.
1986) (form very important in determining whether repurchase agreement was sale
or secured loan, particularly where parties to agreement were sophisticated).
The MLPA uses the form and language of sales transactions. For
accounting and tax purposes, the Bank will treat the transfer as an absolute
sale. Except for the repurchase obligations (and the limited advance obligations
as Coop Master Servicer discussed above), the Bank has no duty to satisfy the
obligations to the Purchaser using its own funds. Instead, payments will be
received from funds generated by the Mortgage Loans. See In re Evergreen Valley
Resort, 23 B.R. 659, 661 (Bankr. D. Me. 1982) (secured loan if transferor can
use any source of funds to pay transferees rather than expected repayment from
obligors.)
After the sale pursuant to the MLPA, the Bank will have very few rights
with respect to the Mortgage Loans. Except for the repurchase obligations
described above, the Bank has no liability with respect to the Mortgage Loans.
Other than with respect to the Master Servicing Fee and the Special Servicing
Fee, the Bank has no right to payment from collections on the Mortgage Loans.
The rights the Bank retains with respect to the Mortgage Loans relate primarily
to the mechanics of administration: the right to receive notices, certain
control over the enforcement of payment obligations on behalf of the Trustee,
and other similar rights. These types of rights do not carry with them the
economic benefits or burdens of ownership.
A fifth important consideration is the intent of the parties. E.g., In
re Xxxxxxx Xxxxxxx, Inc., 65 B.R. 602, 604-05 (S.D. Fla. 1986); In re Xxxxx Xxxx
Corp., 38 B.R. 571, 575-77 (Bankr. S.D.N.Y. 1984). The MLPA provides that it is
intended that the transfer of the Mortgage Loans by the
D-2B-7
Bank to the Trustee be an absolute sale rather than a secured borrowing. The
factors discussed above with respect to the form and structure of the
transaction are further evidence of this intent.
Sixth, some courts have indicated that if the transferor is the
servicer of the transferred loans, or if the transfer is not recorded, then the
transfer is more likely to be characterized as a secured borrowing. E.g., In re
Mid Atlantic Fund, 60 B.R. 604 (Bankr. S.D.N.Y. 1984); In re Xxxx Commercial
Corp., 327 F. Supp. 1315 (S.D.N.Y. 1971). Other courts have rejected this view.
E.g., Xxxxxxx, 813 F.2d at 272 (fact that transferor services mortgage loans is
consistent with absolute sale). Here, the Bank is servicing the NCCB Coop Loans.
However, all assignments of the Mortgages will be recorded, the notes will be
endorsed and the Trustee will maintain possession of the Mortgage Documents on
behalf of the Certificateholders.
Section 541(d) of the Bankruptcy Code provides:
Property in which the debtor holds, as of the commencement of
the case, only legal title and not an equitable interest, such
as a mortgage secured by real property, or an interest in such
a mortgage, sold by the debtor but as to which the debtor
retains legal title to service or supervise the servicing of
such mortgage or interest, becomes property of the estate
under subsection (a) (1) or (2) of this section only to the
extent of the debtor's legal title to such property, but not
to the extent of any equitable interest in such property that
the debtor does not hold.
In enacting Section 541(d), Congress stated that its intention was to
"confirm the current status. . . of bona fide secondary mortgage market
transactions as the purchase and sale of assets. Mortgages or interests in
mortgages sold in the secondary market should not be considered as part of the
debtor's estate." S. Rep. No. 989, 95th Cong., 2d Sess. 83-84 (1978) In
particular, Congress wanted to be sure that sales of mortgage loans would not be
challenged by "trustees asserting that a sale of mortgages is a loan from the
purchaser to the seller." 124 Cong. Rec. S17,413 (daily ed. Oct. 6, 1978).
Accordingly, Congress made it clear that several factors were "irrelevant": the
fact that the transferor performed the servicing, the fact that the assignments
of mortgages were not recorded and the notes not endorsed, and the fact that the
transferor retained possession of the notes and mortgages. The transactions
contemplated by the MLPA and the Pooling Agreement are bona fide secondary
mortgage market transactions which should be protected by the principles
underlying Section 541(d), particularly where, as here, in fact the assignments
were recorded, the notes endorsed and possession of the notes and mortgages have
been transferred to the Trustee.
We are aware of the decision in Octagon Gas Systems, Inc. x. Xxxxxx (In
re Meridian Reserve, Inc.), 995 F.2d 948, 957 (10th Cir.), cert. denied, 000 X.
Xx. 000 (X.X. 1993), in which the Tenth Circuit held that "because, under
Article 9 [of the Uniform Commercial Code], a sale of accounts is treated as if
it creates a security interest in the accounts, accounts sold by a debtor prior
to filing for bankruptcy remain property of the debtor's bankruptcy estate." We
do not believe, however, that this case would be controlling with respect to the
sale of the Mortgage Loans. First, the Octagon case involved the sale of
accounts; we do not believe that the court's reasoning, even if correct with
respect to accounts, applies with equal force to the sale of mortgage loans, the
effect and recordation of which is ordinarily governed primarily by state real
property laws and not the UCC. Second, the Octagon decision appears to be at
variance with many of the authorities cited above. Third, the Octagon decision
D-2B-8
is not binding on courts outside the Tenth Circuit. We note that the Bank's
principal place of business, and its principal assets, are located outside the
Tenth Circuit.
We are also aware of the decision in In re Xxxx, 24 B.R. 542, 545
(Bankr. D. Idaho 1982), in which the Court relied on Section 541(a)(6) of the
Bankruptcy Code to invalidate an assignment that was absolute under state law.
This statement by the bankruptcy court was arguably dicta, but in any event, the
better-reasoned view is that put forth by the United State Court of Appeals for
the Fifth Circuit in In re Louisiana World Exposition, 832 F.2d 1391, 1401 (5th
Cir. 1987): Section 541(a)(6) "does not give the bankrupt's estate property the
debtor would not own if it were solvent."
Based on and subject to the foregoing, as well as the further
qualification that there is no definitive judicial authority confirming the
correctness of the analysis, we are of the opinion that, should the Bank become
the debtor in a case under the Bankruptcy Code, if the matter were properly
briefed and presented to a court, the court would hold that the transfer of the
interests of the Bank in the Mortgage Loans to the Purchaser in the manner set
forth in the MLPA would constitute a sale of the Mortgage Loans and not a
borrowing by the Bank secured by the Mortgage Loans, so that the Mortgage Loans,
the payments thereunder and proceeds therefrom, would not be property of the
Bank's bankruptcy estate pursuant to Section 541(a) of the Bankruptcy Code, and
the Certificateholders' rights to the Mortgage Loans (and the collections
thereon) would not be impaired by the operation of Section 362(a) of the
Bankruptcy Code.
We note that the Bank's rights to compensation as Coop Master Servicer
and Coop Special Servicer may be property of the Bank's estate should the Bank
become a debtor. The automatic stay of Section 362(a) may apply to prohibit any
acts to obtain possession of or exercise control over such property. We note
also that the court may, on an interim basis, impose a temporary or preliminary
stay with respect to the Mortgage Loans in order to afford itself time to
ascertain the facts and apprise itself of the law. See, e.g., In re Leisure
Dynamics, 33 B.R. 171 (Bankr. D. Minn. 1983) (letter of credit).
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D-2B-9
We do not express any opinion herein as to any matter not governed by
the federal laws of the United States of America and New York State Law. This
opinion is solely for benefit of the addressees and may not be relied upon or
used by, circulated, quoted, or referred to, nor any copies hereof be delivered
to, any other person without our prior written approval, provided, however, that
the opinion may be delivered to any person when required by law or any
regulatory authority. We disclaim any obligation to update this opinion letter
for events occurring or coming to our attention after the date hereof.
Very truly yours,
D-2B-10
EXHIBIT D-2C
FORM OF LETTER OF XXXXXXXX XXXXXXXXX XXXXXX ARRONSOHN & XXXXXX LLP,
PURSUANT TO SECTION 7(IX)
November 13, 2001
Credit Suisse First Boston Mortgage Xxxxxx Brothers, Inc.
Securities Corp. 000 Xxxxxx Xxxxxx
00 Xxxxxxx Xxxxxx Xxxxxx Xxxx, Xxx Xxxxxx 00000
Xxx Xxxx, Xxx Xxxx 00000
Credit Suisse First Boston Corporation McDonald Investments, Inc.
00 Xxxxxxx Xxxxxx 000 Xxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000 Xxxxxxxxx, Xxxx 00000
Re: Credit Suisse First Boston Mortgage Securities Corp. Commercial
Mortgage Pass-Through Certificates, Series 2001-CKN5
Ladies and Gentlemen:
We have acted as special counsel to National Consumer Cooperative Bank
("NCCB") in connection with the Pooling and Servicing Agreement ("POOLING AND
SERVICING AGREEMENT") dated as of November 12, 2001, among Credit Suisse First
Boston Mortgage Securities Corp., as Depositor (the "DEPOSITOR"), KeyCorp Real
Estate Capital Markets, Inc., d/b/a Key Commercial Mortgage, as General Master
Servicer, ORIX Real Estate Capital Markets, LLC, as General Special Servicer,
NCCB, as Coop Master Servicer and Coop Special Servicer, and Xxxxx Fargo Bank
Minnesota, N.A., as Trustee, and in connection with the Mortgage Loan Purchase
Agreement (the "NCCB MLPA") dated as of November 1, 2001, between NCCB, as
Seller, and the Depositor, as Purchaser. We have also acted as special counsel
to and NCB Capital Corporation ("NCBCC") in connection with the Mortgage Loan
Purchase Agreement (the "NCBCC MLPA") dated as of November 1, 2001, between
NCBCC, as Seller, and the Depositor, as Purchaser. The NCCB MLPA and the NCBCC
MLPA are referred to herein, collectively, as the "LOAN PURCHASE AGREEMENTS."
This letter is delivered to you at the request of NCCB and NCBCC pursuant to the
Loan Purchase Agreements.
We understand that the Certificates to be issued by the Depositor
pursuant to the Pooling and Servicing Agreement are divided into classes. The
Certificates of Classes X-0, X-0, X-0, X-0, X, X, X and E (collectively, the
"PUBLICLY OFFERED CERTIFICATES") will be sold to the Depositor, Credit Suisse
First Boston Corporation ("CSFB"), Xxxxxx Brothers, and McDonald Investments as
Underwriters (in such capacity, collectively, the "UNDERWRITERS") pursuant to an
Underwriting Agreement (the "UNDERWRITING AGREEMENT") dated November 1, 2001,
and pursuant to the Certificate Purchase Agreement ("CERTIFICATE PURCHASE
AGREEMENT") dated November 1, 2001, between the Depositor and CSFB. The Publicly
Offered Certificates will be offered for sale to the public pursuant to a
prospectus dated October 22, 2001 ("BASE PROSPECTUS"), as supplemented by a
prospectus supplement
D-2C-1
dated November 1, 2001 ("PROSPECTUS SUPPLEMENT" and along with the Base
Prospectus, the "PROSPECTUS"). The Certificates of Classes F, G, H, J, K, L, M,
N, O, A-X and A-CP (collectively, the "PRIVATELY OFFERED CERTIFICATES" and,
along with the Publicly Offered Certificates, the "Certificates") will be sold
to CSFB pursuant to the Certificate Purchase Agreement. CSFB will offer the
Privately Offered Certificates pursuant to a confidential offering circular
dated November 1, 2001 (the "CONFIDENTIAL OFFERING CIRCULAR"). Capitalized terms
not otherwise defined herein are defined as set forth in the Underwriting
Agreement or the Pooling and Servicing Agreement, as applicable.
The purpose of our professional engagement was to advise with respect
to legal matters and not to determine or verify facts. Many of the
determinations involved in the preparation of the Prospectus Supplement and the
Confidential Offering Circular were factual. We have not independently verified,
do not make any representation as to, and do not assume any responsibility for
the accuracy, completeness or fairness of the statements contained in the
Prospectus Supplement or the Confidential Offering Circular.
In connection with the delivery of this letter, we have examined
originals or copies, certified or otherwise identified to our satisfaction, of
the Prospectus, the Confidential Offering Circular, the Loan Purchase
Agreements, the Pooling and Servicing Agreement, and other such documents and
records as we have deemed relevant or necessary as the basis for the views
expressed in this letter. We have obtained such certificates from and made such
inquiries of officers and other representatives of NCCB and NCBCC as we have
deemed relevant or necessary as the basis of the views expressed in this letter.
We have relied upon and assumed the accuracy of, such other documents and
records, such certificates and the statements made in response to such
inquiries, with respect to the factual matters upon which the views expressed in
this letter are based.
We have also assumed (i) the truthfulness and accuracy of each of the
representations and warranties as to factual matters contained in the Loan
Purchase Agreements and the Pooling and Servicing Agreement and underlying the
assumptions set forth below or that are otherwise factually relevant to the
opinions expressed in this letter, (ii) the legal capacity of natural persons,
(iii) the genuineness of all signatures (except for the signatures of officers
of NCCB and NCBCC) and the authenticity of all documents submitted to us as
originals, (iv) the conformity to the originals of all documents submitted to us
as certified conformed or photostatic copies, (v) the due authorization by all
necessary action, and the due execution and delivery, of each of the Loan
Purchase Agreements and the Pooling and Servicing Agreement by the parties
thereto and the constitution of each of the Loan Purchase Agreements and the
Pooling and Servicing Agreement as the legal, valid and binding obligations of
each party thereto, enforceable against such party in accordance with its terms,
except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, liquidation, and similar laws relating to or affecting the
enforceability of creditors' rights generally, the effect of general equitable
principals (in equity or at law), and the availability of equitable remedies,
(vi) the compliance with the relevant provisions of each of the Loan Purchase
Agreements and the Pooling and Servicing Agreement by the parties thereto, (vii)
the conformity, to the requirements of each of the Loan Purchase Agreements and
the Pooling and Servicing Agreement, of the Mortgage Loan Documents delivered to
the Depositor by NCCB and NCBCC, as the case may be, (viii) the absence of any
agreement that supplements or otherwise modifies the agreements expressed in
each of the Loan Purchase Agreements and the Pooling and Servicing Agreement,
and (ix) the conformity of the text of each document filed with the Securities
Exchange Commission through the XXXXX system to the printed documents
D-2C-2
reviewed by us. In rendering this letter, we do not express any view concerning
the laws of any jurisdiction other than the federal laws of the United States of
America.
In the course of acting as special counsel to NCCB and NCBCC we have
responded to inquiries from time to time by their respective closing
coordinators, reviewed title insurance commitments and surveys and prepared most
of the loan documents for a majority of the Mortgage Loans (as defined in the
Loan Purchase Agreements) originated by NCCB and NCBCC. In addition, we have
participated in the preparation of the Prospectus Supplement and the
Confidential Offering Circular and, although we assume no responsibility for the
accuracy and completeness of the Prospectus Supplement or the Confidential
Offering Circular, based upon such participation but without independent review
or verification, nothing has come to our attention which causes us to believe
that, as of their respective dates or as of the Closing Date, either the
Prospectus Supplement or the Confidential Offering Circular contained any untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, except that we express
no opinion as to (i) the financial statements and related notes, financial,
statistical and accounting data and supporting schedules included therein or
other information of that nature contained in or omitted from the Prospectus
Supplement or the Confidential Offering Circular, or (ii) information contained
in the computer diskette or the CD-ROM accompanying the Prospectus Supplement
which we assume, but have not verified, does not vary from and is not different
in any way from the information contained in the Prospectus Supplement. In that
connection, we advise you that we have, as to materiality, relied to the extent
we deemed appropriate on the judgment of officers and other representatives of
NCCB and NCBCC and their affiliates. In addition, in that connection we call to
your attention that, with your knowledge and consent, we have not (except as
described above) examined or otherwise reviewed any of the Mortgage Files in
connection with the transactions contemplated by the Pooling and Servicing
Agreement and the Loan Purchase Agreements, any particular documents contained
in such files or any other documents with respect to the Mortgage Loans.
In basing our opinions and other matters set forth herein "to our
knowledge," or words of similar import, the words "to our knowledge," or such
words of similar import signify that, in the course of our representation of
NCCB and NCBCC in the transactions contemplated by the Loan Purchase Agreements,
the Prospectus Supplement and the Confidential Offering Circular and inquiry of
the lawyers within our firm familiar with the transactions contemplated by such
documents, no information has come to our attention that would give us actual
knowledge or actual notice that any such opinions or other matters set forth
herein are not accurate. Except as otherwise stated herein, we have undertaken
no independent investigation or verification of such matters. All opinions set
forth herein are subject to, and may be limited by, future changes in the
factual matters set forth herein, and we undertake no duty to advise you of the
same.
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D-2C-3
This letter is solely for the benefit of the addressees and may not be relied
upon or used by, circulated, filed with any governmental authority or other
regulatory agency, quoted or referred to, nor may copies hereof be delivered to,
any other person (except to the parties involved in the Transactions and their
respective counsel as part of the closing set related to the Transactions)
without our prior written approval. We disclaim any obligation to update this
letter for events occurring or coming to our attention after the date hereof,
notwithstanding that such changes may affect the views or beliefs expressed in
this letter.
Very truly yours,
D-2C-4
