MORTGAGE LOAN PURCHASE AGREEMENT
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This Mortgage Loan Purchase Agreement (this "Agreement"), is dated and
effective as of December 10, 2002, between GMAC Commercial Mortgage Corporation,
as seller (the "Mortgage Loan Seller"), and GMAC Commercial Mortgage Securities,
Inc., as purchaser (the "Purchaser").
The Mortgage Loan Seller desires to sell, assign, transfer and
otherwise convey to the Purchaser, and the Purchaser desires to purchase,
subject to the terms and conditions set forth below, the multifamily and
commercial mortgage loans (collectively, the "Mortgage Loans") identified on the
schedule annexed hereto as Exhibit A (the "Mortgage Loan Schedule"). Certain
other multifamily and commercial mortgage loans (the "Other Mortgage Loans")
will be purchased by the Purchaser from (i) ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Company
("GSMC"), pursuant to, and for the consideration described in, the Mortgage Loan
Purchase Agreement, dated as of December 10, 2002 (the "GSMC Warehouse Mortgage
Loan Purchase Agreement"), between the Purchaser and GSMC (the mortgage loans
purchased by GSMC under the GSMC Warehouse Mortgage Loan Purchase Agreement, the
"Warehouse Mortgage Loans"), (ii) GSMC, pursuant to, and for the consideration
described in, the Mortgage Loan Purchase Agreement, dated as of December 10,
2002 (the "GSMC Mortgage Loan Purchase Agreement"), between the Purchaser and
GSMC, (iii) German American Capital Corporation, pursuant to, and for the
consideration described in, the Mortgage Loan Purchase Agreement, dated as of
December 10, 2002 (the "GACC Mortgage Loan Purchase Agreement"), between the
Purchaser and GACC and (iv) ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ Mortgage Capital, Inc.,
pursuant to, and for the consideration described in, the Mortgage Loan Purchase
Agreement, dated as of December 10, 2002 (the "MSDWMC Mortgage Loan Purchase
Agreement"), between the Purchaser and MSDWMC.
It is expected that the Mortgage Loans will be transferred, together
with other multifamily and commercial mortgage loans to a trust fund (the "Trust
Fund") to be formed by the Purchaser, beneficial ownership of which will be
evidenced by a series of mortgage pass-through certificates (the
"Certificates"). Certain classes of the Certificates will be rated by Fitch
Ratings, ▇▇▇▇▇'▇ Investors Service, Inc. and Standard & Poor's Ratings Services,
a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc. (together, the "Rating Agencies").
Certain classes of the Certificates (the "Registered Certificates") will be
registered under the Securities Act of 1933, as amended (the "Securities Act").
The Trust Fund will be created and the Certificates will be issued pursuant to a
pooling and servicing agreement to be dated as of December 1, 2002 (the "Pooling
and Servicing Agreement"), among the Purchaser as depositor, GMAC Commercial
Mortgage Corporation as master servicer and special servicer and ▇▇▇▇▇ Fargo
Bank Minnesota, National Association, as trustee (the "Trustee"). Capitalized
terms not otherwise defined herein have the meanings assigned to them in the
Pooling and Servicing Agreement as in effect on the Closing Date.
The Purchaser intends to sell the Class A-1, Class A-2, Class B, Class
C, Class D and Class E Certificates to ▇▇▇▇▇▇▇, Sachs & Co., Deutsche Bank
Securities Inc. and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated (together, the
"Underwriters"), pursuant to an underwriting agreement dated the date hereof
(the "Underwriting Agreement"). The Purchaser intends to sell the Class X-1,
Class X-2, Class F, Class G, Class H, Class J, Class K, Class L, Class M, Class
N, Class O-1, Class O-2 and Class P Certificates to ▇▇▇▇▇▇▇, Sachs & Co.,
Deutsche Bank
Securities Inc. and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated (in such capacity, each an
"Initial Purchaser") pursuant to a certificate purchase agreement, dated the
date hereof (the "Certificate Purchase Agreement"). The Purchaser intends to
sell the Class R-I, Class R-II and Class R-III Certificates to a Qualified
Institutional Buyer (in such capacity, an "Initial Purchaser"). The Class X-1,
Class X-2, Class F, Class G, Class H, Class J, Class K, Class L, Class M, Class
N, Class O, Class P, Class R-I, Class R-II and Class R-III Certificates are
collectively referred to as the "Non-Registered 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 Mortgage Loan Seller agrees to sell, assign, transfer and otherwise
convey to the Purchaser, and the Purchaser agrees to purchase, the Mortgage
Loans. The purchase and sale of the Mortgage Loans shall take place on December
19, 2002 or such other date as shall be mutually acceptable to the parties
hereto (the "Closing Date"). The "Cut-off Date" with respect to each Mortgage
Loan is the Due Date for such Mortgage Loan in December 2002. As of the close of
business on their respective Cut-off Dates (which Cut-off Dates may occur after
the Closing Date), the Mortgage Loans will have an aggregate principal balance
(the "Aggregate Cut-off Date Balance"), after application of all payments of
principal due thereon on or before such date, whether or not received, of
$279,213,697 subject to a variance of plus or minus 5%. The purchase price for
the Mortgage Loans shall be determined by the parties pursuant to an agreed upon
term sheet.
SECTION 2. Conveyance of the Mortgage Loans.
(a) Effective as of the Closing Date, subject only to receipt by the
Mortgage Loan Seller of the purchase price referred to in Section 1 hereof
(exclusive of any applicable holdback for transaction expenses), the Mortgage
Loan Seller does hereby sell, transfer, assign, set over and otherwise convey to
the Purchaser, without recourse, all the right, title and interest of the
Mortgage Loan Seller in and to the Mortgage Loans identified on the Mortgage
Loan Schedule as of such date, including all interest and principal received or
receivable by the Mortgage Loan Seller on or with respect to each Mortgage Loan
after the Cut-off Date for such Mortgage Loan, together with all of the Mortgage
Loan Seller's right, title and interest in and to the proceeds of any related
title, hazard, or other insurance policies and any escrow, reserve or other
comparable accounts related to the Mortgage Loans. The Purchaser shall be
entitled to (and, to the extent received by or on behalf of the Mortgage Loan
Seller, the Mortgage Loan Seller shall deliver or cause to be delivered to or at
the direction of the Purchaser) all scheduled payments of principal and interest
due on each Mortgage Loan after the Cut-off Date for such Mortgage Loan, and all
other recoveries of principal and interest collected thereon after such Cut-off
Date. All scheduled payments of principal and interest due thereon on or before
the Cut-off Date for each Mortgage Loan and collected after such Cut-off Date
shall belong to the Mortgage Loan Seller.
(b) In connection with the Seller's assignment pursuant to subsection
(a) above, the Seller hereby agrees that, at least five (5) Business Days before
the Closing Date, it shall have delivered, or caused to be delivered, to and
deposited with the Trustee, the Mortgage File (as
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described on Exhibit B hereto) for the Mortgage Loans so assigned to the extent
that such Mortgage File was delivered to the Seller by the relevant Mortgage
Loan Seller. On the Closing Date, upon notification from the Seller that the
purchase price referred to in Section 1 (exclusive of any applicable holdback
for transaction expenses) has been received by the Seller, the Trustee shall be
authorized to release to the Purchaser or its designee the Mortgage File in the
Trustee's possession relating to the Mortgage Loans.
(c) All documents and records in the Seller's possession (or under its
control) relating to the Mortgage Loans that are not required to be a part of a
Mortgage File in accordance with Exhibit B (all such other documents and
records, the "Servicing File"), together with all escrow payments, reserve funds
and other comparable funds in the possession of the Seller (or under its
control) with respect to the Mortgage Loans, shall (unless they are held by a
sub-servicer that shall, as of the Closing Date, begin acting on behalf of the
Master Servicer pursuant to a written agreement between such parties) be
delivered by the Seller (or its agent) to the Purchaser (or its designee) no
later than the Closing Date. If a sub-servicer shall, as of the Closing Date,
begin acting on behalf of the Master Servicer with respect to any Mortgage Loan
pursuant to a written agreement between such parties, the Seller shall deliver a
copy of the related Servicing File to the Master Servicer.
(d) The Seller's records will reflect the transfer of the Mortgage
Loans to the Purchaser as a sale.
SECTION 3. Examination of Mortgage Loan Files and Due Diligence Review.
The Mortgage Loan Seller shall reasonably cooperate with any
examination of the Mortgage Files and Servicing Files that may be undertaken by
or on behalf of the Purchaser. The fact that the Purchaser has conducted or has
failed to conduct any partial or complete examination of the Mortgage Files
and/or Servicing Files shall not affect the Purchaser's right to pursue any
remedy available in equity or at law for a breach of the Mortgage Loan Seller's
representations, warranties and covenants set forth in or contemplated by
Section 4.
SECTION 4. Representations, Warranties and Covenants of the Mortgage
Loan Seller.
(a) The Mortgage Loan Seller hereby makes, as of the Closing Date (or
as of such other date specifically provided in the particular representation or
warranty), to and for the benefit of the Purchaser, and its successors and
assigns (including, without limitation, the Trustee and the holders of the
Certificates), each of the representations and warranties set forth in Exhibit C
with respect to the Mortgage Loans, with such changes or modifications as may be
permitted or required by the Rating Agencies.
(b) In addition, the Mortgage Loan Seller, as of the date hereof,
hereby represents and warrants to, and covenants with, the Purchaser that:
(i) The Mortgage Loan Seller is a corporation, duly organized,
validly existing and in good standing under the laws of the State of California,
and is in compliance with the laws of each State in which any Mortgaged Property
is located to the extent necessary to
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ensure the enforceability of each Mortgage Loan and to perform its obligations
under this Agreement.
(ii) The execution and delivery of this Agreement by the
Mortgage Loan Seller, and the performance and compliance with the terms of this
Agreement by the Mortgage Loan Seller, will not violate the Mortgage Loan
Seller's organizational documents or constitute a default (or an event which,
with notice or lapse of time, or both, would constitute a default) under, or
result in the breach of, any material agreement or other instrument to which it
is a party or which is applicable to it or any of its assets, in each case which
materially and adversely affect the ability of the Mortgage Loan Seller to carry
out the transactions contemplated by this Agreement.
(iii) The Mortgage Loan Seller has the full power and
authority to enter into and consummate all transactions contemplated by this
Agreement, has duly authorized the execution, delivery and performance of this
Agreement, and has duly executed and delivered this Agreement.
(iv) This Agreement, assuming due authorization, execution and
delivery by the Purchaser, constitutes a valid, legal and binding obligation of
the Mortgage Loan Seller, enforceable against the Mortgage Loan Seller in
accordance with the terms hereof, subject to (A) applicable bankruptcy,
insolvency, reorganization, moratorium and other laws affecting the enforcement
of creditors' rights generally, (B) general principles of equity, regardless of
whether such enforcement is considered in a proceeding in equity or at law, and
(C) public policy considerations underlying the securities laws, to the extent
that such public policy considerations limit the enforceability of the
provisions of this Agreement that purport to provide indemnification for
securities laws liabilities.
(v) The Mortgage Loan Seller is not in violation of, and its
execution and delivery of this Agreement and its performance and compliance with
the terms of this Agreement will not constitute a violation of, any law, any
order or decree of any court or arbiter, or any order, regulation or demand of
any federal, state or local governmental or regulatory authority, which
violation, in the Mortgage Loan Seller's good faith and reasonable judgment, is
likely to affect materially and adversely either the ability of the Mortgage
Loan Seller to perform its obligations under this Agreement or the financial
condition of the Mortgage Loan Seller.
(vi) No litigation is pending with regard to which Mortgage
Loan Seller has received service of process or, to the best of the Mortgage Loan
Seller's knowledge, threatened against the Mortgage Loan Seller the outcome of
which, in the Mortgage Loan Seller's good faith and reasonable judgment, could
reasonably be expected to prohibit the Mortgage Loan Seller from entering into
this Agreement or materially and adversely affect the ability of the Mortgage
Loan Seller to perform its obligations under this Agreement.
(vii) The Mortgage Loan Seller has not dealt with any broker,
investment banker, agent or other person, other than the Purchaser, the
Underwriters, the Initial Purchasers and their respective affiliates, that may
be entitled to any commission or compensation in connection with the sale of the
Mortgage Loans or the consummation of any of the other transactions contemplated
hereby.
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(viii) Neither the Mortgage Loan Seller nor anyone acting on
its behalf has (A) offered, pledged, sold, disposed of or otherwise transferred
any Certificate, any interest in any Certificate or any other similar security
to any person in any manner, (B) solicited any offer to buy or to accept a
pledge, disposition or other transfer of any Certificate, any interest in any
Certificate or any other similar security from any person in any manner, (C)
otherwise approached or negotiated with respect to any Certificate, any interest
in any Certificate or any other similar security with any person in any manner,
(D) made any general solicitation by means of general advertising or in any
other manner with respect to any Certificate, any interest in any Certificate or
any similar security, or (E) taken any other action, that (in the case of any of
the acts described in clauses (A) through (E) above) would constitute or result
in a violation of the Securities Act or any state securities law relating to or
in connection with the issuance of the Certificates or require registration or
qualification pursuant to the Securities Act or any state securities law of any
Certificate not otherwise intended to be a Registered Certificate. In addition,
the Mortgage Loan Seller will not act, nor has it authorized or will it
authorize any person to act, in any manner set forth in the foregoing sentence
with respect to any of the Certificates or interests therein. For purposes of
this paragraph 4(b)(viii), the term "similar security" shall be deemed to
include, without limitation, any security evidencing or, upon issuance, that
would have evidenced an interest in the Mortgage Loans or the Warehouse Mortgage
Loans or any substantial number thereof.
(ix) Insofar as it relates to the Mortgage Loans and the
Warehouse Mortgage Loans and the Mortgaged Properties related to such Mortgage
Loans or Warehouse Mortgage Loans, the information set forth on pages A-13 and
A-14, inclusive, Annex A to the Prospectus Supplement (as defined in Section 9)
(the "Loan Detail") and, to the extent consistent therewith, the information set
forth on the diskette attached to the Prospectus Supplement and the accompanying
prospectus (the "Diskette"), is true and correct in all material respects.
Insofar as it relates to the Mortgage Loans and Warehouse Mortgage Loans, the
Mortgaged Properties and/or the Mortgage Loan Seller and does not represent a
restatement or aggregation of the information on the Loan Detail, the
information set forth in the Prospectus Supplement and the Memorandum (as
defined in Section 9) under the headings "Summary of Series 2002-C3
Transaction--The Mortgage Pool," "--Geographic Concentrations of the Mortgaged
Properties," "--Property Types," "--Prepayment or Call Protection Provided by
the Mortgage Loans," "Payment Terms of the Mortgage Loans," "Risk Factors" and
"Description of the Mortgage Pool," set forth on Annex A to the Prospectus
Supplement and (to the extent it contains information consistent with that on
such Annex A) set forth on the Diskette, does not contain any untrue statement
of a material fact or (in the case of the Memorandum, when read together with
the other information specified therein as being available for review by
investors) omit to state any material fact necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading.
(x) No consent, approval, authorization or order of,
registration or filing with, or notice to, any governmental authority or court
is required, under federal or state law (including, with respect to any bulk
sale laws), for the execution, delivery and performance of or compliance by the
Mortgage Loan Seller with this Agreement, or the consummation by the Mortgage
Loan Seller of any transaction contemplated hereby, other than (1) the filing or
recording of financing statements, instruments of assignment and other similar
documents
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necessary in connection with Mortgage Loan Seller's sale of the Mortgage Loans
to the Purchaser, (2) such consents, approvals, authorizations, qualifications,
registrations, filings or notices as have been obtained or made and (3) where
the lack of such consent, approval, authorization, qualification, registration,
filing or notice would not have a material adverse effect on the performance by
the Mortgage Loan Seller under this Agreement.
(c) Upon discovery by any of the parties hereto of a breach of any of
the representations and warranties made pursuant to and set forth in subsection
(b) above which materially and adversely affects the interests of the Purchaser
or a breach of any of the representations and warranties made pursuant to
subsection (a) above and set forth in Exhibit C which materially and adversely
affects the value of any Mortgage Loan or the interests therein of the Purchaser
or its successors and assigns (including, without limitation the Trustee and the
holders of the Certificates), the party discovering such breach shall give
prompt written notice to the other party hereto.
SECTION 5. Representations Warranties and Covenants of the Purchaser.
(a) The Purchaser, as of the date hereof, hereby represents and
warrants to, and covenants with, the Mortgage Loan Seller that:
(i) The Purchaser is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware.
(ii) The execution and delivery of this Agreement by the
Purchaser, and the performance and compliance with the terms of this Agreement
by the Purchaser, will not violate the Purchaser's organizational documents or
constitute a default (or an event which, with notice or lapse of time, or both,
would constitute a default) under, or result in the breach of, any material
agreement or other instrument to which it is a party or which is applicable to
it or any of its assets.
(iii) The Purchaser has the full power and authority to enter
into and consummate all transactions contemplated by this Agreement, has duly
authorized the execution, delivery and performance of this Agreement, and has
duly executed and delivered this Agreement.
(iv) This Agreement, assuming due authorization, execution and
delivery by the Mortgage Loan Seller, constitutes a valid, legal and binding
obligation of the Purchaser, enforceable against the Purchaser in accordance
with the terms hereof, subject to (A) applicable bankruptcy, insolvency,
reorganization, moratorium and other laws affecting the enforcement of
creditors' rights generally, and (B) general principles of equity, regardless of
whether such enforcement is considered in a proceeding in equity or at law.
(v) The Purchaser is not in violation of, and its execution
and delivery of this Agreement and its performance and compliance with the terms
of this Agreement will not constitute a violation of, any law, any order or
decree of any court or arbiter, or any order, regulation or demand of any
federal, state or local governmental or regulatory authority, which violation,
in the Purchaser's good faith and reasonable judgment, is likely to affect
materially
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and adversely either the ability of the Purchaser to perform its obligations
under this Agreement or the financial condition of the Purchaser.
(vi) No litigation is pending or, to the best of the
Purchaser's knowledge, threatened against the Purchaser which would prohibit the
Purchaser from entering into this Agreement or, in the Purchaser's good faith
and reasonable judgment, is likely to materially and adversely affect either the
ability of the Purchaser to perform its obligations under this Agreement or the
financial condition of the Purchaser.
(vii) The Purchaser has not dealt with any broker, investment
banker, agent or other person, other than the Mortgage Loan Seller, the
Underwriters, the Initial Purchasers and their respective affiliates, that may
be entitled to any commission or compensation in connection with the sale of the
Mortgage Loans or the consummation of any of the transactions contemplated
hereby.
(viii) No consent, approval, authorization or order of,
registration or filing with, or notice to, any governmental authority or court
is required, under federal or state law, for the execution, delivery and
performance of or compliance by the Purchaser with this Agreement, or the
consummation by the Purchaser of any transaction contemplated hereby, other than
(1) such consents, approvals, authorizations, qualifications, registrations,
filings or notices as have been obtained or made and (2) where the lack of such
consent, approval, authorization, qualification, registration, filing or notice
would not have a material adverse effect on the performance by the Purchaser
under this Agreement.
(b) Upon discovery by any of the parties hereto of a breach of any of
the representations and warranties set forth above which materially and
adversely affects the interests of the Mortgage Loan Seller, the party
discovering such breach shall give prompt written notice to the other party
hereto.
SECTION 6. Repurchases.
(a) Within 90 days of the earlier of discovery or receipt of notice by
the Mortgage Loan Seller, from either the Purchaser or any successor or assign
thereof, of a Defect (as defined in the Pooling and Servicing Agreement as in
effect on the Closing Date) in respect of the Mortgage File for any Mortgage
Loan, a breach of any representation or warranty made pursuant to Section 4(a)
and set forth in Exhibit C (a "Breach"), which Defect or Breach, as the case may
be, materially and adversely affects the value of any Mortgage Loan or any
Mortgaged Property or the interests therein of the Purchaser or its successors
and assigns (including, without limitation, the Trustee and the holders of the
Certificates), the Mortgage Loan Seller shall cure such Defect or Breach, as the
case may be, in all material respects or repurchase the affected Mortgage Loan
from the then owner(s) thereof at the applicable Purchase Price (as defined in
the Pooling and Servicing Agreement as in effect on the Closing Date) by payment
of such Purchase Price by wire transfer of immediately available funds to the
account designated by such owner(s); provided, however, that in lieu of
effecting any such repurchase, the Mortgage Loan Seller will be permitted to
deliver a Qualifying Substitute Mortgage Loan and to pay a cash amount equal to
the applicable Substitution Shortfall Amount, subject to the terms and
conditions of the Pooling and Servicing Agreement as in effect on the Closing
Date; provided, further, that if such Defect
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relates to clause (18) of Exhibit B hereto, the Mortgage Loan Seller may deposit
with the Master Servicer an amount, to be held in a Special Reserve Account (as
defined in the Pooling and Servicing Agreement as in effect on the Closing
Date), equal to the amount of the undelivered letter of credit (or
alternatively, the Mortgage Loan Seller may deliver to the Master Servicer, with
a copy to the Purchaser or any successor or assign thereof, a letter of credit
for the benefit of the Master Servicer on behalf of the Purchaser and upon the
same terms and conditions as the undelivered letter of credit) which the Master
Servicer on behalf of the Purchaser may use (or draw upon, as the case may be)
under the same circumstances and conditions as the Master Servicer would have
been entitled to draw on the undelivered letter of credit. Any such letter of
credit or funds shall be held by the Master Servicer until the earlier of (i)
the date on which the Master Servicer certifies to the Purchaser or any
successor or assign thereof that such Defect has been cured, at which time such
letter of credit or funds shall be returned to the Mortgage Loan Seller and (ii)
the date on which the Mortgage Loan is repurchased.
If the Mortgage Loan Seller is notified of a Defect in any Mortgage
File that corresponds to information set forth in the Mortgage Loan Schedule,
the Mortgage Loan Seller shall promptly correct such Defect and provide a new,
corrected Mortgage Loan Schedule to the Purchaser, which corrected Mortgage Loan
Schedule shall be deemed to amend and replace the existing Mortgage Loan
Schedule for all purposes.
In addition, if, as of the Closing Date, any Mortgage Loan is secured
by a Mortgage that does not constitute a valid first lien upon the related
Mortgaged Property, including all buildings located thereon and all fixtures
attached thereto, or if a Mortgage is subject to something other than (A) the
lien of current real property taxes and assessments not yet due and payable, (B)
covenants, conditions and restrictions, rights of way, easements and other
matters of public record, (C) exceptions and exclusions specifically referred to
in the lender's title insurance policy issued or, as evidenced by a "marked-up"
commitment, to be issued in respect of such Mortgage Loan and (D) those
exceptions set forth on Schedule C-1 to Exhibit C hereto (the exceptions set
forth in the foregoing clauses (A), (B), (C) and (D) collectively, "Permitted
Encumbrances"), or if the insurer that issued the Title Policy referred to in
clause (8) of Exhibit C hereto in respect of any Mortgage Loan was not qualified
to do business in the state in which the related Mortgaged Property is located,
and in either case such failure materially and adversely affects the value of
any Mortgage Loan or any Mortgaged Property or the interests of holders of
Certificates (any such failure, also a "Breach"), the Mortgage Loan Seller shall
be required, at its option, to either (1) cure such Breach in all material
respects or (2) repurchase the affected Mortgage Loan, in each case, within the
applicable Permitted Cure Period. If any such Breach is not corrected or cured
in all material respects within the applicable Permitted Cure Period, the
Mortgage Loan Seller shall, not later than the last day of such Permitted Cure
Period, (i) repurchase the affected Mortgage Loan from the Purchaser or its
assignee at the applicable Purchase Price or (ii) if within the three-month
period commencing on the Closing Date (or within the two-year period commencing
on the Closing Date if the related Mortgage Loan is a "defective obligation"
within the meaning of Section 860G(a)(4)(B)(ii) of the Code and Treasury
Regulation Section 1.860G-2(f)), at its option, replace such Mortgage Loan with
a Qualifying Substitute Mortgage Loan and pay any corresponding Substitution
Shortfall Amount. The Mortgage Loan Seller agrees that any such repurchase or
substitution shall be completed in accordance with and subject to the terms and
conditions of the Pooling and Servicing Agreement.
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For purposes of the preceding paragraph only, the "Permitted Cure
Period" applicable to any Breach in respect of any Mortgage Loan shall be the
90-day period immediately following the earlier of the discovery by the Mortgage
Loan Seller or receipt by the Mortgage Loan Seller of notice of such Breach;
provided that if such Breach cannot be corrected or cured in all material
respects within such 90-day period, but is reasonably likely that such Breach
could be corrected or cured within 180 days of the earlier of discovery by the
Mortgage Loan Seller and receipt by the Mortgage Loan Seller of notice of such
Breach and the Mortgage Loan Seller is diligently attempting to effect such
correction or cure, then the applicable Permitted Cure Period shall, with the
consent of the Purchaser or its assignee (which consent shall not be
unreasonably withheld), be extended for an additional 90 days, unless (i) the
affected Mortgage Loan is in default and (ii) the applicable Breach constitutes
a Material Document Defect (as defined in the Pooling and Servicing Agreement)
other than a Material Document Defect resulting solely from a delay caused by
the public recording or filing office where a document has been sent for
recording or filing.
(b) Notwithstanding Section 6(a), within 60 days of the earlier of
discovery or receipt of notice by the Mortgage Loan Seller, from either the
Purchaser or any successor or assign thereof, that any Mortgage Loan does not
constitute a "qualified mortgage" within the meaning of Section 860G(a)(3) of
the Code, the Mortgage Loan Seller shall repurchase such Mortgage Loan from the
then owner(s) thereof at the applicable Purchase Price by payment of such
Purchase Price by wire transfer of immediately available funds to the account
designated by such owner(s).
(c) In connection with any repurchase of or substitution for a Mortgage
Loan contemplated by this Section 6, the then owner(s) thereof shall tender or
cause to be tendered promptly to the Mortgage Loan Seller, upon delivery of a
receipt executed by the Mortgage Loan Seller, the related Mortgage File and
Servicing File, and each document that constitutes a part of the Mortgage File
that was endorsed or assigned to the Purchaser or the Trustee shall be endorsed
or assigned, as the case may be, to the Mortgage Loan Seller or its designee in
the same manner. The form and sufficiency of all such instruments and
certificates shall be the responsibility of the Mortgage Loan Seller.
(d) Except as provided in Section 2(b), this Section 6 provides the
only remedies available to the Purchaser, and its successors and assigns
(including, without limitation, the Trustee and the holders of the Certificates)
respecting any Defect in a Mortgage File or any Breach, or in connection with
the circumstances described in Section 6(b). If the Mortgage Loan Seller
defaults on its obligations to repurchase any Mortgage Loan in accordance with
Section 6(a) or 6(b) or disputes its obligation to repurchase any Mortgage Loan
in accordance with either such subsection, the Purchaser or its successors and
assigns may take such action as is appropriate to enforce such payment or
performance, including, without limitation, the institution and prosecution of
appropriate proceedings. The Mortgage Loan Seller shall reimburse the Purchaser
for all necessary and reasonable costs and expenses incurred in connection with
such enforcement.
(e) In the event that (i) any Mortgage Loan that is a
Cross-Collateralized Mortgage Loan (as defined in the Pooling and Servicing
Agreement) is required to be repurchased pursuant to this Section 6 as a result
of a Breach, Defect or other event, and (ii) the cross-collateralization
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provisions of the related Cross-Collateralized Mortgage Loans cannot be released
to the extent required by Section 2.03 of the Pooling and Servicing Agreement to
permit repurchase of the affected Mortgage Loan within the time period specified
in this Agreement for such repurchase, the Mortgage Loan Seller shall repurchase
the affected Mortgage Loan and all of the related Cross-Collateralized Mortgage
Loans not so released.
SECTION 7. Closing.
The closing of the sale of the Mortgage Loans (the "Closing") shall be
held at the offices of ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, LLP, ▇▇▇ ▇▇▇▇▇ ▇▇▇. ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ 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 Mortgage Loan
Seller specified herein shall be true and correct as of the Closing Date, and
the Aggregate Cut-off Date Balance shall be within the range permitted by
Section 1 of this Agreement;
(ii) All documents specified in Section 8 (the "Closing Documents"), in
such forms as are agreed upon and acceptable to the Purchaser, shall be duly
executed and delivered by all signatories as required pursuant to the respective
terms thereof;
(iii) The Mortgage Loan Seller shall have delivered and released to the
Trustee, the Purchaser or the Purchaser's designee, as the case may be, all
documents and funds required to be so delivered pursuant to Section 2;
(iv) The result of any examination of the Mortgage Files and Servicing
Files performed by or on behalf of the Purchaser pursuant to Section 3 shall be
satisfactory to the Purchaser in its sole determination;
(v) All other terms and conditions of this Agreement required to be
complied with on or before the Closing Date shall have been complied with, and
the Mortgage Loan 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 Mortgage Loan Seller shall have paid or agreed to pay all
fees, costs and expenses payable by it to the Purchaser pursuant to this
Agreement; and
(vii) Neither the Underwriting Agreement nor either of the Certificate
Purchase Agreements shall have been terminated in accordance with its terms.
Both parties agree to use their best efforts to perform their
respective obligations hereunder in a manner that will enable the Purchaser to
purchase the Mortgage Loans on the Closing Date.
SECTION 8. Closing Documents.
The Closing Documents shall consist of the following:
10
(a) This Agreement duly executed and delivered by the Purchaser and the
Mortgage Loan Seller;
(b) An Officer's Certificate substantially in the form of Exhibit D-1
hereto, executed by the Secretary or an assistant secretary of the Mortgage Loan
Seller, and dated the Closing Date, and upon which the Purchaser and each
Underwriter may rely, attaching thereto as exhibits the organizational documents
of the Mortgage Loan Seller;
(c) A certificate of good standing regarding the Mortgage Loan Seller
from the Secretary of State for the State of California, dated not earlier than
30 days prior to the Closing Date;
(d) A certificate of the Mortgage Loan Seller substantially in the form
of Exhibit D-2 hereto, executed by an executive officer or authorized signatory
of the Mortgage Loan Seller and dated the Closing Date, and upon which the
Purchaser and each Underwriter may rely;
(e) Written opinions of counsel for the Mortgage Loan Seller, in a form
reasonably acceptable to counsel for the Purchaser, subject to such reasonable
assumptions and qualifications as may be requested by counsel for the Mortgage
Loan Seller and acceptable to counsel for the Purchaser, dated the Closing Date
and addressed to the Purchaser and each Underwriter;
(f) Any other opinions of counsel for the Mortgage Loan Seller
reasonably requested by the Rating Agencies in connection with the issuance of
the Certificates, each of which shall include the Purchaser and each Underwriter
as an addressee; and
(g) Such further certificates, opinions and documents as the Purchaser
may reasonably request.
SECTION 9. Indemnification.
(a) The Mortgage Loan Seller agrees to indemnify and hold harmless the
Purchaser, its officers and directors, and each person, if any, who controls the
Purchaser within the meaning of either Section 15 of the Securities Act or
Section 20 of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), against any and all losses, claims, damages or liabilities, joint or
several, to which they or any of them may become subject under the Securities
Act, the Exchange Act or other federal or state statutory law or regulation, at
common law or otherwise, insofar as such losses, claims, damages or liabilities
(or actions in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in the
Prospectus Supplement, the Memorandum or the Diskette, to the extent used in
connection with the offer and sale of the Certificates, the summaries, reports,
documents and other written and computer materials and all other information
regarding the Mortgage Loans or the Mortgaged Properties related to the Mortgage
Loans or the Mortgage Loan Seller furnished or made available electronically or
in writing by the Mortgage Loan Seller for review by prospective investors or
for use in materials to be reviewed by prospective investors, or insofar as they
are required to be filed as part of the Registration Statement pursuant to the
No-Action Letters, any Computational Materials or ABS Term Sheets with respect
to the Registered Certificates, or in any revision or amendment thereof or
supplement thereto, or arise out of or are
11
based upon the omission or alleged omission (in the case of any such
Computational Materials or ABS Term Sheets, when read in conjunction with the
Prospectus and, in the case of the Memorandum, when read together with the other
information specified therein as being available for review by investors) to
state therein a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading; but only if and to the extent that (i) any such untrue
statement or alleged untrue statement or omission or alleged omission is with
respect to information regarding the Mortgage Loans or Warehouse Mortgage Loans
contained in the Loan Detail or, to the extent consistent therewith, the
Diskette or contained in the Term Sheet Diskette, to the extent consistent with
the Term Sheet Master Tape; or (ii) any such untrue statement or alleged untrue
statement or omission or alleged omission is with respect to information
regarding the Mortgage Loan Seller, the Mortgage Loans or the Warehouse Mortgage
Loans, the Mortgaged Properties of the Mortgage Loan Seller contained in the
Prospectus Supplement or the Memorandum under the headings "Summary of Series
2002-C3 Transaction - The Mortgage Pool," "--Geographic Concentrations of the
Mortgaged Properties," "--Property Types," "--Prepayment or Call Protection
Provided by the Mortgage Loans," "--Payment Terms of the Mortgage Loans," "Risk
Factors" and/or "Description of the Mortgage Pool" or contained on Annex A to
the Prospectus Supplement (exclusive of the Loan Detail), and such information
does not represent a restatement or aggregation of information contained in the
Loan Detail; or (iii) such untrue statement, alleged untrue statement, omission
or alleged omission arises out of or is based upon a breach of the
representations and warranties of the Mortgage Loan Seller set forth in or made
pursuant to Section 4; provided, that the indemnification provided by this
Section 9 shall not apply to the extent that such untrue statement of a material
fact or omission of a material fact necessary to make the statements made, in
light of the circumstances in which they were made, not misleading, was made as
a result of an error in the manipulation of, or calculations based upon, the
Loan Detail. This indemnity agreement will be in addition to any liability,
which the Mortgage Loan Seller may otherwise have.
For purposes of the foregoing, "Registration Statement" shall mean the
registration statement No. 333-100695 filed by the Purchaser on Form S-3,
including without limitation exhibits thereto and information incorporated
therein by reference; "Prospectus" shall mean the prospectus dated November 6,
2002, as supplemented by the prospectus supplement dated December 10, 2002 (the
"Prospectus Supplement"), relating to the Registered Certificates; "Memorandum"
shall mean the private placement memorandum dated December 10, 2002, relating to
the Non-Registered Certificates; "Computational Materials" shall have the
meaning assigned thereto in the no-action letter dated May 20, 1994 issued by
the Division of Corporation Finance of the Securities and Exchange Commission
(the "Commission") to ▇▇▇▇▇▇, Peabody Acceptance Corporation I, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇
& Co. Incorporated, and ▇▇▇▇▇▇ Structured Asset Corporation and the no-action
letter dated May 27, 1994 issued by the Division of Corporation Finance of the
Commission to the Public Securities Association (together, the "▇▇▇▇▇▇ Letters";
and "ABS Term Sheets" shall have the meaning assigned thereto in the no-action
letter dated February 17, 1995 issued by the Division of Corporation Finance of
the Commission to the Public Securities Association (the "PSA Letter" and,
together with the ▇▇▇▇▇▇ Letters, the "No-Action Letters"). The mortgage loan
information and related information contained on the diskette attached to any
ABS Term Sheets or Computational Materials is referred to herein as the "Term
Sheet Diskette" and the tape provided by the Mortgage Loan Seller that was used
to
12
create the Term Sheet Diskette is referred to herein as the "Term Sheet
Master Tape." References herein to ABS Term Sheets or Computational Materials
shall include any Term Sheet Diskette provided therewith.
(b) Promptly after receipt by any person entitled to indemnification
under this Section 9 (each, an "indemnified party") of notice of the
commencement of any action, such indemnified party will, if a claim in respect
thereof is to be made against the Mortgage Loan Seller (the "indemnifying
party") under this Section 9, notify the indemnifying party in writing of the
commencement thereof; but the omission to notify the indemnifying party will not
relieve it from any liability that it may have to any indemnified party
otherwise than under this Section 9. In case any such action is brought against
any indemnified party and it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate therein, and to
the extent that it may elect by written notice delivered to the indemnified
party promptly after receiving the aforesaid notice from such indemnified party,
to assume the defense thereof, with counsel satisfactory to such indemnified
party; provided, however, that if the defendants in any such action include both
the indemnified party and the indemnifying party and the indemnified party or
parties shall have reasonably concluded that there may be legal defenses
available to it or them and/or other indemnified parties that are different from
or additional to those available to the indemnifying party, the indemnified
party or parties shall have the right to select separate counsel to assert such
legal defenses and to otherwise participate in the defense of such action on
behalf of such indemnified party or parties. Upon receipt of notice from the
indemnifying party to such indemnified party of its election to assume the
defense of such action and approval by the indemnified party of counsel, which
approval will not be unreasonably withheld, the indemnifying party will not be
liable for any legal or other expenses subsequently incurred by such indemnified
party in connection with the defense thereof, unless: (i) the indemnified party
shall have employed separate counsel in connection with the assertion of legal
defenses in accordance with the proviso to the preceding sentence (it being
understood, however, that the indemnifying party shall not be liable for the
expenses of more than one separate counsel, approved by the Purchaser and the
indemnifying party, representing all the indemnified parties under Section 9(a)
who are parties to such action), (ii) the indemnifying party shall not have
employed counsel reasonably satisfactory to the indemnified party to represent
the indemnified party within a reasonable time after notice of commencement of
the action or (iii) the indemnifying party has authorized the employment of
counsel for the indemnified party at the expense of the indemnifying party; and
except that, if clause (i) or (iii) is applicable, such liability shall only be
in respect of the counsel referred to in such clause (i) or (iii).
(c) If the indemnification provided for in this Section 9 is due in
accordance with its terms but is for any reason held by a court to be
unavailable to an indemnified party on grounds of policy or otherwise, then the
indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities, in such proportion as is
appropriate to reflect the relative fault of the indemnified and indemnifying
parties in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative fault of the indemnified and indemnifying parties
shall be determined by reference to, among other things, whether the untrue or
alleged untrue
13
statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by such parties.
(d) The Purchaser and the Mortgage Loan Seller agree that it would not
be just and equitable if contribution pursuant to Section 9(c) were determined
by pro rata allocation or by any other method of allocation that does not take
account of the considerations referred to in Section 9(c) above. The amount paid
or payable by an indemnified party as a result of the losses, claims, damages
and liabilities referred to in this Section 9 shall be deemed to include,
subject to the limitations set forth above, any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim, except where the indemnified party is
required to bear such expenses pursuant to this Section 9, which expenses the
indemnifying party shall pay as and when incurred, at the request of the
indemnified party, to the extent that the indemnifying party will be ultimately
obligated to pay such expenses. If any expenses so paid by the indemnifying
party are subsequently determined to not be required to be borne by the
indemnifying party hereunder, the party that received such payment shall
promptly refund the amount so paid to the party, which made such payment. No
person guilty of fraudulent misrepresentation (within the meaning of Section 11
(f) of the Securities Act) shall be entitled to contribution from any person who
was not guilty of such fraudulent misrepresentation.
(e) The indemnity and contribution agreements contained in this Section
9 shall remain operative and in full force and effect regardless of (i) any
termination of this Agreement, (ii) any investigation made by any indemnified
party, and (iii) acceptance of and payment for any of the Certificates.
SECTION 10. Costs.
Costs relating to the transactions contemplated hereby shall be borne
by the respective parties hereto.
SECTION 11. Notices.
All demands, notices and communications hereunder shall be in writing
and shall be deemed to have been duly given if personally delivered to or
mailed, by registered mail, postage prepaid, by overnight mail or courier
service, or transmitted by facsimile and confirmed by a similar mailed writing,
if to the Purchaser, addressed to GMAC Commercial Mortgage Securities, Inc. at
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: Structured Finance
Manager, facsimile no. (▇▇▇) ▇▇▇-▇▇▇▇, with a copy to the General Counsel, GMAC
Commercial Mortgage Corporation, or such other address or facsimile number as
may hereafter be furnished to the Mortgage Loan Seller in writing by the
Purchaser; and if to the Mortgage Loan Seller, addressed to GMAC Commercial
Mortgage Corporation, at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇,
Attention: Structured Finance Manager, facsimile no. (▇▇▇) ▇▇▇-▇▇▇▇, with a copy
to GMAC Commercial Mortgage Corporation, or to such other address or facsimile
number as the Mortgage Loan Seller may designate in writing to the Purchaser.
SECTION 12. Third Party Beneficiaries.
14
Each of the officers, directors and controlling persons referred to in
Section 9 hereof is an intended third party beneficiary of the covenants and
indemnities of the Mortgage Loan Seller set forth in Section 9 of this
Agreement. It is acknowledged and agreed that such covenants and indemnities may
be enforced by or on behalf of any such person or entity against the Mortgage
Loan Seller to the same extent as if it was a party hereto.
SECTION 13. Representations Warranties and Agreements to Survive
Delivery.
All representations, warranties and agreements contained in this
Agreement, incorporated herein by reference or contained in the certificates of
officers of the Mortgage Loan Seller submitted pursuant hereto, shall remain
operative and in full force and effect and shall survive delivery of the
Mortgage Loans by the Mortgage Loan Seller to the Purchaser or its designee.
SECTION 14. Severability of Provisions.
Any part, provision, representation, warranty or covenant of this
Agreement that is prohibited or which is held to be void or unenforceable shall
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof. Any part, provision,
representation, warranty or covenant of this Agreement that is prohibited or
unenforceable or is held to be void or unenforceable in any particular
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
particular jurisdiction shall not invalidate or render unenforceable such
provision in any other jurisdiction. To the extent permitted by applicable law,
the parties hereto waive any provision of law, which prohibits or renders void
or unenforceable any provision hereof.
SECTION 15. Counterparts.
This Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original, but all of which together shall
constitute one and the same instrument.
SECTION 16. GOVERNING LAW.
THIS AGREEMENT AND THE RIGHTS, DUTIES, OBLIGATIONS AND RESPONSIBILITIES OF THE
PARTIES HERETO SHALL BE GOVERNED IN ACCORDANCE WITH THE INTERNAL LAWS AND
DECISIONS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES
EXCEPT THAT THE PARTIES HERETO INTEND THAT THE PROVISIONS OF SECTION 5-1401 OF
THE NEW YORK GENERAL OBLIGATIONS LAW SHALL APPLY TO THIS AGREEMENT.
SECTION 17. Further Assurances.
The Mortgage Loan 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.
15
SECTION 18. Successors and Assigns.
The rights and obligations of the Mortgage Loan Seller under this
Agreement shall not be assigned by the Mortgage Loan Seller without the prior
written consent of the Purchaser, except that any person into which the Mortgage
Loan Seller may be merged or consolidated, or any corporation or other entity
resulting from any merger, conversion or consolidation to which the Mortgage
Loan Seller is a party, or any person succeeding to all or substantially all of
the business of the Mortgage Loan Seller, shall be the successor to the Mortgage
Loan Seller hereunder. The Purchaser has the right to assign its interest under
this Agreement, in whole or in part, as may be required to effect the purposes
of the Pooling and Servicing Agreement, and the assignee shall, to the extent of
such assignment, succeed to the rights and obligations hereunder of the
Purchaser. Subject to the foregoing, this Agreement shall bind and inure to the
benefit of and be enforceable by the Mortgage Loan Seller and the Purchaser, and
their permitted successors and assigns, and the indemnified parties referred to
in Section 9.
SECTION 19. Amendments.
No term or provision of this Agreement may be amended, waived, modified
or in any way altered, unless such amendment, waiver, modification or alteration
is in writing and signed by a duly authorized officer of the party against whom
such amendment, waiver, modification or alteration is sought to be enforced. In
addition, this Agreement may not be changed in any manner, which would have a
material adverse effect on any third party beneficiary under Section 12 hereof
without the prior consent of that person.
16
IN WITNESS WHEREOF, the Mortgage Loan Seller and the Purchaser have
caused their names to be signed hereto by their respective duly authorized
officers as of the date first above written.
GMAC COMMERCIAL MORTGAGE CORPORATION
By:____________________________________________
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
By:_____________________________________________
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President
EXHIBIT A
---------
MORTGAGE LOAN SCHEDULE
A-1
EXHIBIT B
The "Mortgage File" for any Mortgage Loan shall, subject to Section
2(b), collectively consists of the following documents:
(1) the original Mortgage Note, endorsed by the most recent
endorsee prior to the Trustee or, if none, by the originator, without recourse,
in blank or to the order of the Trustee in the following form: "Pay to the order
of ▇▇▇▇▇ Fargo Bank Minnesota, National Association, as trustee for the
registered holders of GMAC Commercial Mortgage Securities, Inc., Mortgage
Pass-Through Certificates, Series 2002-C3, without recourse";
(2) the original or a copy of the Mortgage and, if applicable,
the originals or copies of any intervening assignments thereof showing a
complete chain of assignment from the originator of the Mortgage Loan to the
most recent assignee of record thereof prior to the Trustee, if any, in each
case with evidence of recording indicated thereon;
(3) the original of the assignment of the Mortgage, in
recordable form, executed by the most recent assignee of record thereof prior to
the Trustee, or if none by the originator, either in blank or in favor of the
Trustee (in such capacity);
(4) an original or copy of any related Assignment of Leases
(if such item is a document separate from the Mortgage) and, if applicable, the
originals or copies of any intervening assignments thereof showing a complete
chain of assignment from the originator of the Mortgage Loan to the most recent
assignee of record thereof prior to the Trustee, if any, in each case with
evidence of recording thereon;
(5) an original assignment of any related Assignment of Leases
(if such item is a document separate from the Mortgage), in recordable form,
executed by the most recent assignee of record thereof prior to the Trustee, or,
if none, by the originator, either in blank or in favor of the Trustee (in such
capacity), which assignment may be included as part of the corresponding
assignment of Mortgage, referred to in clause (3) above;
(6) an original or a copy of any related Security Agreement
(if such item is a document separate from the Mortgage) and, if applicable, the
originals or copies of any intervening assignments thereof showing a complete
chain of assignment from the originator of the Mortgage Loan to the most recent
assignee of record thereof prior to the Trustee, if any;
(7) an original assignment of any related Security Agreement
(if such item is a document separate from the Mortgage) executed by the most
recent assignee of record thereof prior to the Trustee or, if none, by the
originator, either in blank or in favor of the Trustee (in such capacity), which
assignment may be included as part of the corresponding assignment of Mortgage
referred to in clause (3) above;
(8) originals or copies of all assumption, modification,
written assurance and substitution agreements, with evidence of recording
thereon, where appropriate, in those instances where the terms or provisions of
the Mortgage, Mortgage Note or any related security document have been modified
or the Mortgage Loan has been assumed;
B-1
(9) the original or a copy of the lender's title insurance
policy, together with all endorsements or riders (or copies thereof) that were
issued with or subsequent to the issuance of such policy, insuring the priority
of the Mortgage as a first lien on the Mortgaged Property;
(10) the original or a copy of any guaranty of the obligations
of the Mortgagor under the Mortgage Loan which was in the possession of the
Mortgage Loan Seller at the time the Mortgage Files were delivered to the
Trustee together with (A) if applicable, the original or copies of any
intervening assignments of such guaranty showing a complete chain of assignment
from the originator of the Mortgage Loan to the most recent assignee thereof
prior to the Trustee, if any, and (B) an original assignment of such guaranty
executed by the most recent assignee thereof prior to the Trustee or, if none,
by the originator;
(11) (A) file or certified copies of any UCC financing
statements and continuation statements which were filed in order to perfect (and
maintain the perfection of) any security interest held by the originator of the
Mortgage Loan (and each assignee of record prior to the Trustee) in and to the
personalty of the Mortgagor at the Mortgaged Property (in each case with
evidence of filing thereon) and which were in the possession of the Mortgage
Loan Seller (or its agent) at the time the Mortgage Files were delivered and (B)
if any such security interest is perfected and the earlier UCC financing
statements and continuation statements were in the possession of the Mortgage
Loan Seller, a UCC financing statement executed by the most recent assignee of
record prior to the Trustee or, if none, by the originator, evidencing the
transfer of such security interest, either in blank or in favor of the Trustee;
(12) the original or a copy of the power of attorney (with
evidence of recording thereon, if appropriate) granted by the Mortgagor if the
Mortgage, Mortgage Note or other document or instrument referred to above was
not signed by the Mortgagor;
(13) if the Mortgagor has a leasehold interest in the related
Mortgage Loan, the original ground lease or a copy thereof;
(14) if the Mortgage Loan is a Credit Lease Loan, an original
of the credit lease enhancement insurance policy, if any, obtained with respect
to such Mortgage Loan and an original of the residual value insurance policy, if
any, obtained with respect to such Mortgage Loan;
(15) the original or a copy of any lockbox agreement or
deposit account or similar agreement;
(16) the original or a copy of any intercreditor agreement
with respect to the Mortgage Loan;
(17) the original or a copy of any environmental insurance
policy;
(18) the original or a copy (if the original is held by the
Master Servicer) of any letter of credit and any related transfer documents;
B-2
(19) for a hospitality property, copies of franchise
agreements, if any, and franchisor comfort letters, if any;
(20) a checklist of all documents included in the Mortgage
File; and
(21) any additional documents required to be added to the
Mortgage File pursuant to this Agreement; provided that whenever the term
"Mortgage File" is used to refer to documents actually received by the Purchaser
or the Trustee, such term shall not be deemed to include such documents and
instruments required to be included therein unless they are actually so
received. The original assignments referred to in clauses (3), (5), (7) and
(10)(B), may be in the form of one or more instruments in recordable form in any
applicable filing offices.
B-3
EXHIBIT C
REPRESENTATIONS AND WARRANTIES OF THE MORTGAGE LOAN SELLER
REGARDING THE INDIVIDUAL MORTGAGE LOANS
With respect to each Mortgage Loan, the Mortgage Loan Seller hereby
represents and warrants, as of the date hereinbelow specified or, if no such
date is specified, as of the Closing Date, except as set forth on Schedule C-1
hereto, that:
1) Mortgage Loan Schedule. The information set forth in the Mortgage
Loan Schedule is complete, true and correct in all material respects as of the
date of this Agreement and as of the Cut-Off Date.
2) Whole Loan; Ownership of Mortgage Loans. Each Mortgage Loan is a
whole loan and not a participation interest in a mortgage loan. Immediately
prior to the transfer to the Purchaser of the Mortgage Loans, the Seller had
good title to, and was the sole owner of, each Mortgage Loan. The Seller has
full right, power and authority to transfer and assign each of the Mortgage
Loans to or at the direction of the Purchaser and has validly and effectively
conveyed (or caused to be conveyed) to the Purchaser or its designee all of the
Seller's legal and beneficial interest in and to the Mortgage Loans free and
clear of any and all pledges, liens, charges, security interests and/or other
encumbrances. The sale of the Mortgage Loans to the Purchaser or its designee
does not require the Seller to obtain any governmental or regulatory approval or
consent that has not been obtained.
3) Payment Record. No scheduled payment of principal and interest under
any Mortgage Loan was 30 days or more past due as of the Cut-Off Date, and no
Mortgage Loan was 30 days or more delinquent in the twelve-month period
immediately preceding the Cut-Off Date.
4) Valid Assignment. The related assignment of such Mortgage executed
and delivered in favor of the Trustee is in recordable form and constitutes a
legal, valid and binding assignment, sufficient to convey to the assignee named
therein all of the assignor's right, title and interest in, to and under such
Mortgage. Such Mortgage, together with any separate security agreements, chattel
mortgages or equivalent instruments, establishes and creates a valid and,
subject to the exceptions set forth in paragraph 13 below, enforceable security
interest in favor of the holder thereof in all of the related Mortgagor's
personal property used in, and reasonably necessary to operate, the related
Mortgaged Property. In the case of a Mortgaged Property operated as a hotel or
an assisted living facility, the Mortgagor's personal property includes all
personal property that a prudent mortgage lender making a similar Mortgage Loan
would deem reasonably necessary to operate the related Mortgaged Property as it
is currently being operated. A Uniform Commercial Code financing statement has
been filed and/or recorded in all places necessary to perfect a valid security
interest in such personal property, to the extent a security interest may be so
created therein, and such security interest is a first priority security
interest, subject to any prior purchase money security interest in such personal
property and any personal property leases applicable to such personal property.
Notwithstanding the foregoing, no representation is made as to the perfection of
any security interest in rents or other personal property to the extent that
possession or control of such items or actions other than the filing of
C-1
Uniform Commercial Code financing statements are required in order to effect
such perfection.
5) Assignment of Leases and Rents. The Assignment of Leases related to
and delivered in connection with each Mortgage Loan establishes and creates a
valid, subsisting and, subject to the exceptions set forth in paragraph 13
below, enforceable first priority lien and first priority security interest in
the related Mortgagor's interest in all leases, sub-leases, licenses or other
agreements pursuant to which any person is entitled to occupy, use or possess
all or any portion of the real property subject to the related Mortgage, and
each assignor thereunder has the full right to assign the same. The related
assignment of any Assignment of Leases not included in a Mortgage has been
executed and delivered in favor of the Trustee and is in recordable form and
constitutes a legal, valid and binding assignment, sufficient to convey to the
assignee named therein all of the assignor's right, title and interest in, to
and under such Assignment of Leases.
6) Mortgage Status; Waivers and Modifications. No Mortgage has been
satisfied, cancelled, rescinded or subordinated in whole or in part, and the
related Mortgaged Property has not been released from the lien of such Mortgage,
in whole or in part (except for partial reconveyances of real property that are
set forth on Schedule C-1 to Exhibit C), nor has any instrument been executed
that would effect any such satisfaction, cancellation, subordination, rescission
or release, in any manner that, in each case, materially adversely affects the
value of the related Mortgaged Property. None of the terms of any Mortgage Note,
Mortgage or Assignment of Leases has been impaired, waived, altered or modified
in any respect, except by written instruments, all of which are included in the
related Mortgage File.
7) Condition of Property; Condemnation. (i) With respect to the
Mortgaged Properties securing the Mortgage Loans that were the subject of an
engineering report within 18 months prior to the Cut-Off Date as set forth on
Schedule C-1 to this Exhibit C, each Mortgaged Property is, to the Seller's
knowledge, free and clear of any damage (or adequate reserves therefor have been
established) that would materially and adversely affect its value as security
for the related Mortgage Loan, and (ii) with respect to the Mortgaged Properties
securing the Mortgage Loans that were not the subject of an engineering report
within 18 months prior to the Cut-Off Date as set forth on Schedule C-1 to this
Exhibit C, each Mortgaged Property is in good repair and condition and all
building systems contained therein are in good working order (or adequate
reserves therefor have been established) and each Mortgaged Property is free of
structural defects, in each case, that would materially and adversely affect its
value as security for the related Mortgage Loan as of the date hereof. The
Seller has received no notice of the commencement of any proceeding for the
condemnation of all or any material portion of any Mortgaged Property. To the
Seller's knowledge (based on surveys and/or title insurance obtained in
connection with the origination of the Mortgage Loans), as of the date of the
origination of each Mortgage Loan, all of the material improvements on the
related Mortgaged Property that were considered in determining the appraised
value of the Mortgaged Property lay wholly within the boundaries and building
restriction lines of such property, except for encroachments that are insured
against by the lender's title insurance policy referred to herein or that do not
materially and adversely affect the value or marketability of such Mortgaged
Property, and no improvements on adjoining properties materially encroached upon
such Mortgaged Property so as to materially and adversely affect the value or
marketability of such Mortgaged Property, except those encroachments that are
insured against by the Title Policy referred to herein.
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8) Title Insurance. Each Mortgaged Property is covered by an American
Land Title Association (or an equivalent form of) lender's title insurance
policy or a marked-up title insurance commitment (on which the required premium
has been paid) which evidences such title insurance policy (the "Title Policy")
in the original principal amount of the related Mortgage Loan after all advances
of principal. Each Title Policy insures that the related Mortgage is a valid
first priority lien on such Mortgaged Property, subject only to Permitted
Encumbrances. Each Title Policy (or, if it has yet to be issued, the coverage to
be provided thereby) is in full force and effect, all premiums thereon have been
paid and no material claims have been made thereunder and no claims have been
paid thereunder. No holder of the related Mortgage has done, by act or omission,
anything that would materially impair the coverage under such Title Policy.
Immediately following the transfer and assignment of the related Mortgage Loan
to the Trustee, such Title Policy (or, if it has yet to be issued, the coverage
to be provided thereby) will inure to the benefit of the Trustee without the
consent of or notice to the insurer. To the Seller's knowledge, the insurer
issuing such Title Policy is qualified to do business in the jurisdiction in
which the related Mortgaged Property is located.
9) No Holdbacks. The proceeds of each Mortgage Loan have been fully
disbursed and there is no obligation for future advances with respect thereto.
With respect to each Mortgage Loan, any and all requirements as to completion of
any on-site or off-site improvement and as to disbursements of any funds
escrowed for such purpose that were to have been complied with on or before the
Closing Date have been complied with, or any such funds so escrowed have not
been released.
10) Mortgage Provisions. The Mortgage Note or Mortgage for each
Mortgage Loan, together with applicable state law, contains customary and
enforceable provisions (subject to the exceptions set forth in paragraph 13)
such as to render the rights and remedies of the holder thereof adequate for the
practical realization against the related Mortgaged Property of the principal
benefits of the security intended to be provided thereby.
11) Trustee under Deed of Trust. If any Mortgage is a deed of trust,
(1) a trustee, duly qualified under applicable law to serve as such, is properly
designated and serving under such Mortgage, and (2) no fees or expenses are
payable to such trustee by the Seller, the Purchaser or any transferee thereof
except in connection with a trustee's sale after default by the related
Mortgagor or in connection with any full or partial release of the related
Mortgaged Property or related security for the related Mortgage Loan.
12) Environmental Conditions.
i) With respect to the Mortgaged Properties securing the Mortgage
Loans that were the subject of an environmental site assessment within
18 months prior to the Cut-Off Date as set forth on Schedule C-1 to
this Exhibit C, an environmental site assessment, or an update of a
previous such report, was performed with respect to each Mortgaged
Property in connection with the origination or the sale of the related
Mortgage Loan, a report of each such assessment (or the most recent
assessment with respect to each Mortgaged Property) (an "Environmental
Report") has been delivered to the Purchaser, and the Seller has no
knowledge of any material and adverse environmental condition or
circumstance affecting any Mortgaged Property that was not disclosed in
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such report. Each Mortgage requires the related Mortgagor to comply
with all applicable federal, state and local environmental laws and
regulations. Where such assessment disclosed the existence of a
material and adverse environmental condition or circumstance affecting
any Mortgaged Property, (i) a party not related to the Mortgagor was
identified as the responsible party for such condition or circumstance
or (ii) environmental insurance covering such condition was obtained or
must be maintained until the condition is remediated or (iii) the
related Mortgagor was required either to provide additional security
that was deemed to be sufficient by the originator in light of the
circumstances and/or to establish an operations and maintenance plan.
In the case of each Mortgage Loan set forth on Schedule C-1 to this
Exhibit C, (i) such Mortgage Loan is the subject of a Secured Creditor
Impaired Property Policy, issued by the issuer set forth on Schedule
C-1 (the "Policy Issuer") and effective as of the date thereof (the
"Environmental Insurance Policy"), (ii) the Environmental Insurance
Policy is in full force and effect, (iii)(a) a property condition or
engineering report was prepared with respect to lead based paint
("LBP"), asbestos containing materials ("ACM") and radon gas ("RG") at
each related Mortgaged Property and (b) if such report disclosed the
existence of a material and adverse LBP, ACM or RG environmental
condition or circumstance affecting the related Mortgaged Property, the
related Mortgagor (A) was required to remediate the identified
condition prior to closing the Mortgage Loan or provide additional
security, or establish with the lender a reserve from loan proceeds, in
an amount deemed to be sufficient by the Seller for the remediation of
the problem and/or (B) agreed in the Mortgage Loan documents to
establish an operations and maintenance plan after the closing of the
Mortgage Loan, (iv) on the effective date of the Environmental
Insurance Policy, Seller as originator had no knowledge of any material
and adverse environmental condition or circumstance affecting the
Mortgaged Property (other than the existence of LBP, ACM or RG) that
was not disclosed to the Policy Issuer in one or more of the following:
(a) the application for insurance, (b) a borrower questionnaire that
was provided to the Policy Issuer or (c) an engineering or other report
provided to the Policy Issuer and (v) the premium of any Environmental
Insurance Policy has been paid through the maturity of the policy's
term and the term of such policy extends at least five years beyond the
maturity of the Mortgage Loan.
ii) With respect to the Mortgaged Properties securing the Mortgage
Loans that were not the subject of an environmental site assessment
within 18 months prior to the Cut-Off Date as set forth on Schedule C-1
to this Exhibit C, (i) no Hazardous Material is present on such
Mortgaged Property such that (1) the value of such Mortgaged Property
is materially and adversely affected or (2) under applicable federal,
state or local law, (a) such Hazardous Material could be required to be
eliminated at a cost materially and adversely affecting the value of
the Mortgaged Property before such Mortgaged Property could be altered,
renovated, demolished or transferred or (b) the presence of such
Hazardous Material could (upon action by the appropriate governmental
authorities) subject the owner of such Mortgaged Property, or the
holders of a security interest therein, to liability for the cost of
eliminating such Hazardous Material or the hazard created thereby at a
cost materially and adversely affecting the value of the Mortgaged
Property, and (ii) such Mortgaged Property is in material compliance
with all applicable federal, state and local laws pertaining to
Hazardous Materials or environmental hazards, any noncompliance with
such laws does not have a material
C-4
adverse effect on the value of such Mortgaged Property and neither
Seller nor, to Seller's knowledge, the related Mortgagor or any current
tenant thereon, has received any notice of violation or potential
violation of any such law.
"Hazardous Materials" means gasoline, petroleum products, explosives,
radioactive materials, polychlorinated biphenyls or related or similar
materials, and any other substance or material as may be defined as a
hazardous or toxic substance by any federal, state or local
environmental law, ordinance, rule, regulation or order, including
without limitation, the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended (42 U.S.C.
(Sections) 9601 et seq.), the Hazardous Materials Transportation Act as
amended (42 U.S.C. (Sections) 6901 et seq.), the Federal Water
Pollution Control Act as amended (33 U.S.C. (Sections) 1251 et seq.),
the Clean Air Act (42 U.S.C. (Sections) 1251 et seq.) and any
regulations promulgated pursuant thereto.
13) Loan Document Status. Each Mortgage Note, Mortgage and other
agreement that evidences or secures such Mortgage Loan and was executed by or on
behalf of the related Mortgagor is the legal, valid and binding obligation of
the maker thereof (subject to any non-recourse provisions contained in any of
the foregoing agreements and any applicable state anti-deficiency or market
value limit deficiency legislation), enforceable in accordance with its terms,
except as such enforcement may be limited by bankruptcy, insolvency,
reorganization or other similar laws affecting the enforcement of creditors'
rights generally, and by general principles of equity (regardless of whether
such enforcement is considered in a proceeding in equity or at law) and there is
no valid defense, counterclaim or right of offset or rescission available to the
related Mortgagor with respect to such Mortgage Note, Mortgage or other
agreement.
14) Insurance. Each Mortgaged Property is, and is required pursuant to
the related Mortgage to be, insured by (a) a fire and extended perils insurance
policy providing coverage against loss or damage sustained by reason of fire,
lightning, windstorm, hail, explosion, riot, riot attending a strike, civil
commotion, aircraft, vehicles and smoke, and, to the extent required as of the
date of origination by the originator of such Mortgage Loan consistent with its
normal commercial mortgage lending practices, against other risks insured
against by persons operating like properties in the locality of the Mortgaged
Property in an amount not less than the lesser of the principal balance of the
related Mortgage Loan and the replacement cost of the Mortgaged Property, and
contains no provisions for a deduction for depreciation, and not less than the
amount necessary to avoid the operation of any co-insurance provisions with
respect to the Mortgaged Property; (b) a business interruption or rental loss
insurance policy, in an amount at least equal to six months of operations of the
Mortgaged Property; (c) a flood insurance policy (if any portion of buildings or
other structures on the Mortgaged Property are located in an area identified by
the Federal Emergency Management Agency as having special flood hazards and the
Federal Emergency Management Agency requires flood insurance to be maintained);
and (d) a comprehensive general liability insurance policy in amounts as are
generally required by commercial mortgage lenders, and in any event not less
than $1 million per occurrence. Such insurance policy contains a standard
mortgagee clause that names the mortgagee as an additional insured in the case
of liability insurance policies and as a loss payee in the case of property
insurance policies and requires prior notice to the holder of the Mortgage of
termination or cancellation. No such notice has been received, including any
notice of nonpayment of premiums, that has not been cured. Each Mortgage
obligates the related Mortgagor to maintain
C-5
all such insurance and, upon such Mortgagor's failure to do so, authorizes the
holder of the Mortgage to maintain such insurance at the Mortgagor's cost and
expense and to seek reimbursement therefor from such Mortgagor. Each Mortgage
provides that casualty insurance proceeds will be applied (a) to the restoration
or repair of the related Mortgaged Property, (b) to the restoration or repair of
the related Mortgaged Property, with any excess insurance proceeds after
restoration or repair being paid to the Mortgagor, or (c) to the reduction of
the principal amount of the Mortgage Loan.
15) Taxes and Assessments. As of the Closing Date, there are no
delinquent or unpaid taxes, assessments (including assessments payable in future
installments) or other outstanding charges affecting any Mortgaged Property that
are or may become a lien of priority equal to or higher than the lien of the
related Mortgage. For purposes of this representation and warranty, real
property taxes and assessments shall not be considered unpaid until the date on
which interest or penalties would be first payable thereon.
16) Mortgagor Bankruptcy. No Mortgaged Property, nor any portion
thereof is the subject of, and no Mortgagor under a Mortgage loan is, a debtor
in any state or federal bankruptcy or insolvency or similar proceeding.
17) Leasehold Estate. Each Mortgaged Property consists of a fee simple
estate in real estate or, if the related Mortgage Loan is secured in whole or in
part by the interest of a Mortgagor as a lessee under a ground lease of a
Mortgaged Property (a "Ground Lease"), by the related Mortgagor's interest in
the Ground Lease but not by the related fee interest in such Mortgaged Property
(the "Fee Interest"), and as to such Ground Leases:
i) Such Ground Lease or a memorandum thereof has been or will be
duly recorded; such Ground Lease (or the related estoppel letter or
lender protection agreement between the Seller and related lessor) does
not prohibit the current use of the Mortgaged Property and does not
prohibit the interest of the lessee thereunder to be encumbered by the
related Mortgage; and there has been no material change in the payment
terms of such Ground Lease since the origination of the related
Mortgage Loan, with the exception of material changes reflected in
written instruments that are a part of the related Mortgage File;
ii) The lessee's interest in such Ground Lease is not subject to
any liens or encumbrances superior to, or of equal priority with, the
related Mortgage, other than Permitted Encumbrances;
iii) The Mortgagor's interest in such Ground Lease is assignable to
the Purchaser and its successors and assigns upon notice to, but
without the consent of, the lessor thereunder (or, if such consent is
required, it has been obtained prior to the Closing Date) and, in the
event that it is so assigned, is further assignable by the Purchaser
and its successors and assigns upon notice to, but without the need to
obtain the consent of, such lessor or if such lessor's consent is
required it cannot be unreasonably withheld;
iv) Such Ground Lease is in full force and effect, and the Ground
Lease provides that no material amendment to such Ground Lease is
binding on a mortgagee
C-6
unless the mortgagee has consented thereto, and the Seller has received
no notice that an event of default has occurred thereunder, and, to the
Seller's knowledge, there exists no condition that, but for the passage
of time or the giving of notice, or both, would result in an event of
default under the terms of such Ground Lease;
v) Such Ground Lease, or an estoppel letter or other agreement, (A)
requires the lessor under such Ground Lease to give notice of any
default by the lessee to the holder of the Mortgage; and (B) provides
that no notice of termination given under such Ground Lease is
effective against the holder of the Mortgage unless a copy of such
notice has been delivered to such holder and the lessor has offered or
is required to enter into a new lease with such holder on terms that do
not materially vary from the economic terms of the Ground Lease.
vi) A mortgagee is permitted a reasonable opportunity (including,
where necessary, sufficient time to gain possession of the interest of
the lessee under such Ground Lease) to cure any default under such
Ground Lease, which is curable after the receipt of notice of any such
default, before the lessor thereunder may terminate such Ground Lease;
vii) Such Ground Lease has an original term (including any
extension options set forth therein) which extends not less than twenty
years beyond the Stated Maturity Date of the related Mortgage Loan;
viii) Under the terms of such Ground Lease and the related
Mortgage, taken together, any related insurance proceeds or
condemnation award awarded to the holder of the ground lease interest
will be applied either (A) to the repair or restoration of all or part
of the related Mortgaged Property, with the mortgagee or a trustee
appointed by the related Mortgage having the right to hold and disburse
such proceeds as the repair or restoration progresses (except in such
cases where a provision entitling a third party to hold and disburse
such proceeds would not be viewed as commercially unreasonable by a
prudent commercial mortgage lender), or (B) to the payment of the
outstanding principal balance of the Mortgage Loan together with any
accrued interest thereon; and
ix) Such Ground Lease does not impose any restrictions on
subletting which would be viewed as commercially unreasonable by
prudent commercial mortgage lenders lending on a similar Mortgaged
Property in the lending area where the Mortgaged Property is located;
and such Ground Lease contains a covenant that the lessor thereunder is
not permitted, in the absence of an uncured default, to disturb the
possession, interest or quiet enjoyment of the lessee thereunder for
any reason, or in any manner, which would materially adversely affect
the security provided by the related Mortgage.
x) Such Ground Lease requires the Lessor to enter into a new lease
upon termination of such Ground Lease if the Ground Lease is rejected
in a bankruptcy proceeding.
18) Escrow Deposits. All escrow deposits and payments relating to each
Mortgage Loan that are, as of the Closing Date, required to be deposited or paid
have been so deposited or
C-7
paid.
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)
(without regard to Section 856(e)(4) of the Code).
20) [Reserved]
21) Advancement of Funds by the Seller. No holder of a Mortgage Loan
has advanced funds or induced, solicited or knowingly received any advance of
funds from a party other than the owner of the related Mortgaged Property,
directly or indirectly, for the payment of any amount required by such Mortgage
Loan.
22) No Mechanics' Liens. Each Mortgaged Property is free and clear of
any and all mechanics' and materialmen's liens that are prior or equal to the
lien of the related Mortgage, and no rights are outstanding that under law could
give rise to any such lien that would be prior or equal to the lien of the
related Mortgage except, in each case, for liens insured against by the Title
Policy referred to herein.
23) Compliance with Usury Laws. Each Mortgage Loan complied with all
applicable usury laws in effect at its date of origination.
24) Cross-collateralization. No Mortgage Loan is cross-collateralized
or cross-defaulted with any loan other than one or more other Mortgage Loans.
25) Releases of Mortgaged Property. Except as described in the next
sentence, no Mortgage Note or Mortgage requires the mortgagee to release all or
any material portion of the related Mortgaged Property that was included in the
appraisal for such Mortgaged Property, and/or generates income from the lien of
the related Mortgage except upon payment in full of all amounts due under the
related Mortgage Loan or in connection with the defeasance provisions of the
related Note and Mortgage. The Mortgages relating to those Mortgage Loans
identified on Schedule C-1 hereto require the mortgagee to grant releases of
portions of the related Mortgaged Properties upon (a) the satisfaction of
certain legal and underwriting requirements and/or (b) the payment of a release
price and prepayment consideration in connection therewith. Except as described
in the first sentence hereof and for those Mortgage Loans identified on Schedule
C-1 hereto, no Mortgage Loan permits the full or partial release or substitution
of collateral unless the mortgagee or servicer can require the Borrower to
provide an opinion of tax counsel to the effect that such release or
substitution of collateral (a) would not constitute a "significant modification"
of such Mortgage Loan within the meaning of Treas. Reg. (Section) 1.1001-3 and
(b) would not cause such Mortgage Loan to fail to be a "qualified mortgage"
within the meaning of Section 860G(a)(3)(A) of the Code.
26) No Equity Participation or Contingent Interest. No Mortgage Loan
contains any equity participation by the lender or provides for negative
amortization (except that the ARD Loan may provide for the accrual of interest
at an increased rate after the Anticipated Repayment
C-8
Date) or for any contingent or additional interest in the form of participation
in the cash flow of the related Mortgaged Property.
27) No Material Default. There exists no material Event of Default,
breach, violation or event of acceleration (and, to the Seller's actual
knowledge, no event which, with the passage of time or the giving of notice, or
both, would constitute any of the foregoing) under the documents evidencing or
securing the Mortgage Loan, in any such case to the extent the same materially
and adversely affects the value of the Mortgage Loan and the related Mortgaged
Property; provided, however, that this representation and warranty does not
address or otherwise cover any default, breach, violation or event of
acceleration that specifically pertains to any matter otherwise covered by any
other representation and warranty made by the Seller in any of paragraphs 3, 7,
12, 14, 15, 16 and 17 of this Exhibit C.
28) Inspections. The Seller (or if the Seller is not the originator,
the originator of the Mortgage Loan) has inspected or caused to be inspected
each Mortgaged Property in connection with the origination of the related
Mortgage Loan.
29) Local Law Compliance. Based on due diligence considered reasonable
by prudent commercial mortgage lenders in the lending area where the Mortgaged
Property is located, the improvements located on or forming part of each
Mortgaged Property comply with applicable zoning laws and ordinances, or
constitute a legal non-conforming use or structure or, if any such improvement
does not so comply, such non-compliance does not materially and adversely affect
the value of the related Mortgaged Property, such value as determined by the
appraisal performed at origination or in connection with the sale of the related
Mortgage Loan by the Seller hereunder.
30) Junior Liens. None of the Mortgage Loans permits the related
Mortgaged Property to be encumbered by any lien (other than a Permitted
Encumbrance) junior to or of equal priority with the lien of the related
Mortgage without the prior written consent of the holder thereof or the
satisfaction of debt service coverage or similar criteria specified therein. The
Seller has no knowledge that any of the Mortgaged Properties is encumbered by
any lien junior to the lien of the related Mortgage.
31) Actions Concerning Mortgage Loans. To the knowledge of the Seller,
there are no actions, suits or proceedings before any court, administrative
agency or arbitrator concerning any Mortgage Loan, Mortgagor or related
Mortgaged Property that might adversely affect title to the Mortgaged Property
or the validity or enforceability of the related Mortgage or that might
materially and adversely affect the value of the Mortgaged Property as security
for the Mortgage Loan or the use for which the premises were intended.
32) Servicing. The servicing and collection practices used by the
Seller or any prior holder or servicer of each Mortgage Loan have been in all
material respects legal, proper and prudent and have met customary industry
standards.
33) Licenses and Permits. To the Seller's knowledge, based on due
diligence that it customarily performs in the origination of comparable mortgage
loans, as of the date of origination of each Mortgage Loan or as of the date of
the sale of the related Mortgage Loan by
C-9
the Seller hereunder, the related Mortgagor was in possession of all material
licenses, permits and franchises required by applicable law for the ownership
and operation of the related Mortgaged Property as it was then operated.
34) Assisted Living Facility Regulation. If the Mortgaged Property is
operated as an assisted living facility, to the Seller's knowledge (a) the
related Mortgagor is in compliance in all material respects with all federal and
state laws applicable to the use and operation of the related Mortgaged Property
and (b) if the operator of the Mortgaged Property participates in Medicare or
Medicaid programs, the facility is in compliance in all material respects with
the requirements for participation in such programs.
35) Collateral in Trust. The Mortgage Note for each Mortgage Loan is
not secured by a pledge of any collateral that has not been assigned to the
Purchaser.
36) Due on Sale. Each Mortgage Loan contains a "due on sale" clause,
which provides for the acceleration of the payment of the unpaid principal
balance of the Mortgage Loan if, without prior written consent of the holder of
the Mortgage, the property subject to the Mortgage or any material portion
thereof, or a controlling interest in the related Mortgagor, is transferred,
sold or encumbered; provided, however, that certain Mortgage Loans provide a
mechanism for the assumption of the loan by a third party upon the Mortgagor's
satisfaction of certain conditions precedent, and upon payment of a transfer
fee, if any, or transfer of interests in the Mortgagor or constituent entities
of the Mortgagor to a third party or parties related to the Mortgagor upon the
Mortgagor's satisfaction of certain conditions precedent.
37) Single Purpose Entity. The Mortgagor on each Mortgage Loan with a
Cut-Off Date Principal Balance in excess of $10 million, was, as of the
origination of the Mortgage Loan, a Single Purpose Entity. For this purpose, a
"Single Purpose Entity" shall mean an entity, other than an individual, whose
organizational documents provide substantially to the effect that it was formed
or organized solely for the purpose of owning and operating one or more of the
Mortgaged Properties securing the Mortgage Loans and prohibit it from engaging
in any business unrelated to such Mortgaged Property or Properties, and whose
organizational documents further provide, or which entity represented in the
related Mortgage Loan documents, substantially to the effect that it does not
have any assets other than those related to its interest in and operation of
such Mortgaged Property or Properties, or any indebtedness other than as
permitted by the related Mortgage(s) or the other related Mortgage Loan
documents, that it has its own books and records and accounts separate and apart
from any other person (other than a Mortgagor for a Mortgage Loan that is
cross-collateralized and cross-defaulted with the related Mortgage Loan), and
that it holds itself out as a legal entity, separate and apart from any other
person.
38) Non-Recourse Exceptions. The Mortgage Loan documents for each
Mortgage Loan provide that such Mortgage Loan constitutes either (a) the
recourse obligations of at least one natural person or (b) the non-recourse
obligations of the related Mortgagor, provided that at least one natural person
(and the Mortgagor if the Mortgagor is not a natural person) is liable to the
holder of the Mortgage Loan for damages arising in the case of fraud or willful
misrepresentation by the Mortgagor, misappropriation of rents, insurance
proceeds or condemnation awards and breaches of the environmental covenants in
the Mortgage Loan
C-10
documents.
39) Defeasance and Assumption Costs. The related Mortgage Loan
Documents provide that the related borrower is responsible for the payment of
all reasonable costs and expenses of the lender incurred in connection with the
defeasance of such Mortgage Loan and the release of the related Mortgaged
Property, and the borrower is required to pay all reasonable costs and expenses
of the lender associated with the approval of an assumption of such Mortgage
Loan.
40) Defeasance. No Mortgage Loan provides that it can be defeased until
the date that is more than two years after the Closing Date or provides that it
can be defeased with any property other than government securities (as defined
in Section 2(a)(16) of the Investment Company Act of 1940, as amended) or any
direct non-callable security issued or guaranteed as to principal or interest by
the United States.
41) Prepayment Premiums. As of the applicable date of origination of
each such Mortgage Loan, any prepayment premiums and yield maintenance charges
payable under the terms of the Mortgage Loans, in respect of voluntary
prepayments, constituted customary prepayment premiums and yield maintenance
charges for commercial mortgage loans.
For purposes of these representations and warranties, the
phrases "to the knowledge of the Mortgage Loan Seller" or "to the Mortgage Loan
Seller's knowledge" shall mean (except where otherwise expressly set forth
below) the actual state of knowledge of the Mortgage Loan Seller (i) after the
Mortgage Loan 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 Mortgage Loan Seller's underwriting standards, at the time of the Mortgage
Loan Seller's origination or acquisition of the particular Mortgage Loan; and
(ii) subsequent to such origination, utilizing the monitoring practices
customarily utilized by prudent commercial or multifamily, as applicable,
mortgage lenders with respect to securitizable commercial or multifamily, as
applicable, mortgage loans, including inquiry with a representative of the loan
servicer designated as the party responsible for the knowledge of the servicer
pertaining to the Mortgage Loans. Also for purposes of these representations and
warranties, the phrases "to the actual knowledge of the Mortgage Loan Seller" or
"to the Mortgage Loan Seller's actual knowledge" shall mean (except where
otherwise expressly set forth below) the actual state of knowledge of the
Mortgage Loan Seller without any express or implied obligation to make inquiry.
All information contained in the documents included in the definition of
Mortgage File in the Pooling and Servicing Agreement shall be deemed to be
within the knowledge and the actual knowledge of the Mortgage Loan Seller, to
the extent that the Mortgage Loan Seller or its closing counsel or custodian, if
any, has reviewed or had possession of such document at any time. For purposes
of these representations and warranties, to the extent that any representation
or warranty is qualified by the Mortgage Loan Seller's knowledge with respect to
the contents of the Mortgage Note, Mortgage, lender's title policy and any
letters of credit or Ground Leases, if such document is not included in the
Mortgage File, the Mortgage Loan Seller shall make such representation or
warranty without any such qualification. Wherever there is a reference in a
representation or warranty to receipt by, or possession of, the Mortgage Loan
Seller of any information or documents, or to any action taken by the Mortgage
Loan Seller or to any action
C-11
which has not been taken by the Mortgage Loan 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, the
Mortgage Loan Seller. For purposes of these representations and warranties, when
referring to the conduct of "reasonable prudent institutional commercial or
multifamily, as applicable mortgage lenders" (or similar such phrases and
terms), such conduct shall be measured by reference to the industry standards
generally in effect as of the date the related representation or warranty
relates to or is made.
It is understood and agreed that the representations and warranties set
forth in this Exhibit C shall survive delivery of the respective Mortgage Files
to the Purchaser and/or the Trustee and shall inure to the benefit of the
Purchaser, and its successors and assigns (including without limitation the
Trustee and the holders of the Certificates), notwithstanding any restrictive or
qualified endorsement or assignment.
C-12
SCHEDULE C-1 TO EXHIBIT C
EXCEPTIONS TO REPRESENTATIONS AND WARRANTIES
REP 7 CONDITION OF PROPERTY; CONDEMNATION
-----------------------------------------
----------------------------------------------------------------------------------------------------------------------
Loan Number Property Name Issue
----------- ------------- -----
----------------------------------------------------------------------------------------------------------------------
25195 Otay Lakes Office Building Engineering reports older than 18 months as of the
Closing Date.
----------------------------------------------------------------------------------------------------------------------
29617 Residence Inn (▇▇▇▇▇▇▇) Engineering reports older than 18 months as of the
Closing Date.
----------------------------------------------------------------------------------------------------------------------
32989 Comfort Suites (San Diego) Engineering reports older than 18 months as of the
Closing Date.
----------------------------------------------------------------------------------------------------------------------
REP 12 ENVIRONMENTAL CONDITIONS
-------------------------------
----------------------------------------------------------------------------------------------------------------------
Loan Number Property Name Issue
----------- ------------- -----
----------------------------------------------------------------------------------------------------------------------
25195 Otay Lakes Office Building Phase I reports older than 18 months as of the
Closing Date.
----------------------------------------------------------------------------------------------------------------------
32989 Comfort Suites (San Diego) Phase I reports older than 18 months as of the
Closing Date.
----------------------------------------------------------------------------------------------------------------------
REP 14 INSURANCE
----------------
----------------------------------------------------------------------------------------------------------------------
Loan Number Property Name Issue
----------- ------------- -----
----------------------------------------------------------------------------------------------------------------------
31819 Beachway Shopping Center Windstorm limit of $2,487,000
----------------------------------------------------------------------------------------------------------------------
35716 Swift's Marketplace Windstorm limit of $600,000
----------------------------------------------------------------------------------------------------------------------
34722 Roosevelt Village Apartments No insurance coverage for terrorism or terrorist acts.
----------------------------------------------------------------------------------------------------------------------
▇▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ No insurance coverage for terrorism or terrorist acts.
----------------------------------------------------------------------------------------------------------------------
35666 ▇▇▇▇▇ Creek Apartments No insurance coverage for terrorism or terrorist acts.
----------------------------------------------------------------------------------------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ No insurance coverage for terrorism or terrorist acts.
----------------------------------------------------------------------------------------------------------------------
36031 Fairway Preserve at Olde No insurance coverage for terrorism or terrorist acts.
Cypress
----------------------------------------------------------------------------------------------------------------------
36179 The Arbors Apartments No insurance coverage for terrorism or terrorist acts.
----------------------------------------------------------------------------------------------------------------------
37802 ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇. No insurance coverage for terrorism or terrorist acts.
----------------------------------------------------------------------------------------------------------------------
37825 ▇▇▇▇▇ Branch Self Storage No insurance coverage for terrorism or terrorist acts.
----------------------------------------------------------------------------------------------------------------------
38061 Frog Pond No insurance coverage for terrorism or terrorist acts.
----------------------------------------------------------------------------------------------------------------------
38525 Comerica Bank Building No insurance coverage for terrorism or terrorist acts.
----------------------------------------------------------------------------------------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇ Apartments Insurance coverage for terrorism or terrorist acts is
limited to $1 million.
----------------------------------------------------------------------------------------------------------------------
38008 White Oak Apartments Insurance coverage for terrorism or terrorist acts is
limited to $1 million.
----------------------------------------------------------------------------------------------------------------------
C-1-1
REP 25 RELEASES OF MORTGAGED PROPERTY
-------------------------------------
----------------------------------------------------------------------------------------------------------------------
Loan Property Name Issue
---- ------------- -----
Number
------
----------------------------------------------------------------------------------------------------------------------
34339 Holiday Inn - The Mortgage Loan contains the following release terms.
Select (New
Orleans) Provided that no Event of Default has occurred and is continuing, Borrower shall have the
right to substitute its fee or leasehold estate in another parcel of land (the "Substitute
Parcel") for its leasehold estate in the leasehold parcel securing the loan, provided, but
not limited to, the following: (a) the substitute parcel (i) contain at least the same
number of parking spaces; (ii) be of at least equal utility, convenience and distance from
the hotel; (iii) be managed by a satisfactory parking lot manager; (iv) be subject to the
lien and terms of the Mortgage; and (v) be acceptable to Lender in all aspects; (b) Borrower
has good and marketable title to the substitute parcel; (c) such substitution shall not
cause the hotel and the Property to be in violation of any zoning or land use laws; (d)
Borrower provides at least 30 days prior written notice of its intent to substitute; and (e)
Borrower pays all costs and expenses associated such substitution.
----------------------------------------------------------------------------------------------------------------------
36029 Palms of The Mortgage Loan contains the following release terms.
Carrollwood
From and after the Optional Defeasance Date, Borrower shall have the right, on any Payment
Date to obtain a release of one parcel from lien of the Mortgage in connection with a sale
of the Release Parcel to an unaffiliated third party, provided that (a) no Event of Default
has occurred and is continuing; (b) the terms and provisions of Article 23 of the Mortgage
and Section II(E) of the Note have been complied with; and (c) beneficial ownership of the
Release Parcel is transferred to the third party, and upon satisfaction of the items
identified in Section 23.1 of the Mortgage to include: (i) at least thirty (30) days prior
written notice, (ii) payment of the release amount or partial defesance deposit, (iii)
payment of all of Lender's costs and expenses, (iv) evidence that the Borrower is Solvent
and shall not be rendered Insolvent by the Partial Release, (v) Rating Agency approval, (vi)
the combined debt service coverage ratio for the twelve (12) month period immediately
preceding the Parcel Release with respect to the remaining property shall be equal to or
greater than 1.25x and the loan to value ratio on the remaining property shall be no greater
than 75%, and (vii) in no event shall the Allocated Loan Amounts for the remaining property
be reduced as a result of any Partial Defeasance.
The Release Parcel is identified as Road House Grill located at ▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇ in Tampa, Florida. The allocated loan amount is $340,000 and the
release Amount is $425,000, which is equal to 125% of the allocated loan amount
----------------------------------------------------------------------------------------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ The Mortgage Loan contains the following release terms.
Lender will permit the release of approximately 37,000 square feet of land provided (a) no
Event of Default has occurred and is continuing; (b) the Property has maintained a debt
service coverage ratio of at least 1.30x for the trailing 18 months; (c) the partial release
shall not cause the Property to fail to comply with any zoning requirement; (d) the Release
Parcel constitutes a separate legal parcel; (e) Lender has approved any restrictive
covenants that will encumber the Property; (f) Borrower pays all of Lender's costs and
expenses associated with the partial release; (g) Borrower executes any required documents
required by Lender; (h) Lender receives a opinion of counsel and (i) Borrower complies with
such other requirements as Lender may reasonably require in connection with the release.
----------------------------------------------------------------------------------------------------------------------
C-1-2
REP 30 JUNIOR LIENS
-------------------
----------------------------------------------------------------------------------------------------------------------
Loan Property Name Issue
---- ------------- -----
Number
------
----------------------------------------------------------------------------------------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ There is a fully subordinate, floating rate mezzanine loan in the amount of $1,500,000 held
by the Lender which is secured by a pledge of interests in the Borrower.
-------------------------------------------------------------------------------------------------------------------------
37595 Shops at River Certain unsecured interpartnership loans are allowed in an amount equal to no more than the
Park lesser of 5% of the outstanding principal balance and $1,000,000, provided that, among other
things, (1) such member enters into an intercreditor, standstill and subordination agreement
which subordinates such member's rights with respect to the subordinate loan and the Shops
at River Park loan and prohibits remedial action against the borrower until the Shops at
River Park loan has been paid in full, (2) no payment under any such loan shall be made
except out of excess cash flow after all such amounts then due in connection with the Shops
at River Park loan have been satisfied and (3) rating agency confirmation is received that
none of the ratings on the certificates will be withdrawn or downgraded. Such a "Partner
Loan" will be fully subordinate and not secured by the property.
-------------------------------------------------------------------------------------------------------------------------
REP 38 NON-RECOURSE EXCEPTIONS
------------------------------
----------------------------------------------------------------------------------------------------------------------
Loan Property Name Issue
---- ------------- -----
Number
------
----------------------------------------------------------------------------------------------------------------------
29617 Residence Inn (▇▇▇▇▇▇▇) No natural person is liable for the non-recourse
carveouts.
----------------------------------------------------------------------------------------------------------------------
36294 South Coast Medical No natural person is liable for the non-recourse
carveouts.
----------------------------------------------------------------------------------------------------------------------
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
-----------
FORM OF CERTIFICATE OF AN OFFICER OF THE MORTGAGE LOAN SELLER
GMAC COMMERCIAL MORTGAGE CORPORATION
CERTIFICATE OF SECRETARY
I, the undersigned [Assistant] Secretary of GMAC COMMERCIAL MORTGAGE
CORPORATION (the "COMPANY" or "MORTGAGE LOAN SELLER"), hereby certify as
follows:
1. I am a duly elected, qualified and acting [Assistant] Secretary of
the Company.
2. The Company is a corporation organized under the laws of the State
of California. A true and correct copy of the Certificate of Good Standing for
the Company issued by the Secretary of State for the State of California is
attached hereto as Exhibit I.
3. Also attached hereto as Exhibit I are true, correct and complete
copies of the Company's Certificate of Incorporation and Bylaws, as amended
through the date hereof.
4. Attached hereto as Exhibit II is a copy of certain resolutions of
the Company which have been duly adopted by the Company and which remain in full
force and effect as of the date hereof and have not been amended, rescinded or
impaired in any way.
5. To the best of my knowledge, no proceedings looking toward
liquidation or dissolution of the Mortgage Loan Seller are pending or
contemplated.
6. Each person listed below currently holds the title set forth
opposite his or her name and the signature of each such person (whether applied
manually, by facsimile or as an electronic signature) appearing below, opposite
his or her name, is his or her genuine signature:
NAME TITLE SIGNATURE
---------------------------------------
---------------------------------------
---------------------------------------
---------------------------------------
7. Each person listed above who signed, either manually or by facsimile
signature, the Mortgage Loan Purchase Agreement, dated as of December 10, 2002
(the "Purchase Agreement'), between the Mortgage Loan Seller and GMAC Commercial
Mortgage Securities, Inc. providing for the purchase by GMAC Commercial Mortgage
Securities, Inc. from the Mortgage Loan Seller of the Mortgage Loans, was, at
the respective times of such signing and delivery, duly authorized or appointed
to execute such documents in such capacity, and the
D-1-1
signatures of such persons or facsimiles thereof appearing on such documents
are their genuine signatures.
Capitalized terms not otherwise defined herein have the meanings
assigned to them in the Purchase Agreement.
IN WITNESS WHEREOF, I have executed this Certificate as of this ___th
day of December 2002.
-----------------------------
[Name], [Assistant] Secretary
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF CERTIFICATE OF THE MORTGAGE LOAN SELLER
Certificate of GMAC Commercial Mortgage Corporation
----------------------------------------------------
In connection with the execution and delivery by GMAC Commercial
Mortgage Corporation (the "Mortgage Loan Seller") of, and the consummation of
the transaction contemplated by, that certain Mortgage Loan Purchase Agreement,
dated as of December 10, 2002 (the "Purchase Agreement"), between GMAC
Commercial Mortgage Securities, Inc. and the Mortgage Loan Seller, the Mortgage
Loan Seller hereby certifies that (i) the representations and warranties of the
Mortgage Loan Seller in the Purchase Agreement are true and correct in all
material respects at and as of the date hereof with the same effect as if made
on the date hereof, and (ii) the Mortgage Loan Seller has, in all material
respects, complied with all the agreements and satisfied all the conditions on
its part to be performed or satisfied at or prior to the date hereof.
Capitalized terms not otherwise defined herein have the meanings assigned to
them in the Purchase Agreement.
Certified this __th day of December 2002.
GMAC COMMERCIAL MORTGAGE CORPORATION
By:__________________________________
Name:
Title:
D-2-1
