EXECUTION COPY
MORTGAGE LOAN PURCHASE AGREEMENT
Mortgage Loan Purchase Agreement, dated as of June 20, 2006 (the
"Agreement"), between UBS Real Estate Investments Inc. (together with its
successors and permitted assigns hereunder, the "Seller") and Structured Asset
Securities Corporation II (together with its successors and permitted assigns
hereunder, the "Purchaser").
The Seller intends to sell and the Purchaser intends to purchase
certain multifamily and commercial mortgage loans (the "Mortgage Loans") as
provided herein. The Purchaser intends to deposit the Mortgage Loans, together
with certain other multifamily and commercial mortgage loans (the "Other Loans";
and, together with the Mortgage Loans, the "Securitized Loans"), into a trust
fund (the "Trust Fund"), the beneficial ownership of which will be evidenced by
multiple classes (each, a "Class") of mortgage pass-through certificates (the
"Certificates") to be identified as the LB-UBS Commercial Mortgage Trust
2006-C4, Commercial Mortgage Pass-Through Certificates, Series 2006-C4. One or
more "real estate mortgage investment conduit" ("REMIC") elections will be made
with respect to the Trust Fund. The Certificates will be issued pursuant to a
Pooling and Servicing Agreement, to be dated as of June 12, 2006 (the "Pooling
and Servicing Agreement"), between the Purchaser, as depositor, Wachovia Bank,
National Association, as master servicer (the "Master Servicer"), LNR Partners,
Inc., as special servicer (the "Special Servicer") and LaSalle Bank National
Association, as trustee (the "Trustee"). Capitalized terms used but not defined
herein have the respective meanings set forth in the Pooling and Servicing
Agreement, as in effect on the Closing Date.
The Purchaser has entered into an Underwriting Agreement (the
"Underwriting Agreement"), dated as of the date hereof, with Xxxxxx Brothers
Inc. ("Xxxxxx") and UBS Securities LLC ("UBSS" and, together with Xxxxxx in such
capacity, the "Underwriters"), whereby the Purchaser will sell to the
Underwriters all of the Certificates that are to be registered under the
Securities Act of 1933, as amended (the "Securities Act"). The Purchaser has
also entered into a Certificate Purchase Agreement (the "Certificate Purchase
Agreement"), dated as of the date hereof, with Xxxxxx and UBSS (together in such
capacity, the "Placement Agents"), whereby the Purchaser will sell to the
Placement Agents all of the remaining Certificates (other than the Residual
Interest Certificates).
In connection with the transactions contemplated hereby, the Seller,
the Purchaser, the Underwriters and the Placement Agents have entered into an
Indemnification Agreement (the "Indemnification Agreement"), dated as of the
date hereof.
Now, therefore, in consideration of the premises and the mutual
agreements set forth herein, the parties agree as follows:
SECTION 1. Agreement to Purchase.
The Seller agrees to sell, and the Purchaser agrees to purchase, the
Mortgage Loans identified on the schedule (the "Mortgage Loan Schedule") annexed
hereto as Exhibit A. The Mortgage Loan Schedule may be amended to reflect the
actual Mortgage Loans accepted by the Purchaser pursuant to the terms hereof.
The Mortgage Loans will have an aggregate principal balance of $352,583,006 (the
"Initial UBS Pool Balance") as of the close of business on the Cut-off Date,
after
giving effect to any and all payments of principal due thereon on or before such
date, whether or not received. The purchase and sale of the Mortgage Loans shall
take place on June 29, 2006 or such other date as shall be mutually acceptable
to the parties hereto (the "Closing Date"). The consideration for the Mortgage
Loans shall consist of: (A) a cash amount equal to a percentage (mutually agreed
upon by the parties hereto) of the Initial UBS Pool Balance, plus interest
accrued on each Mortgage Loan at the related Mortgage Rate (net of the related
Administrative Cost Rate), for the period from and including June 12, 2006 up to
but not including the Closing Date, which cash amount shall be paid to the
Seller or its designee by wire transfer in immediately available funds (or by
such other method as shall be mutually acceptable to the parties hereto) on the
Closing Date; and (B) a 17.78629% Percentage Interest in the Class R-I, Class
R-II and Class R-III Certificates and a 100% Percentage Interest in the Class
R-LR Certificates (all such Residual Interest Certificates, the "Seller's
Residual Interest Certificates").
SECTION 2. Conveyance of Mortgage Loans.
(a) Effective as of the Closing Date, subject only to receipt of the
purchase price referred to in Section 1 hereof and satisfaction or waiver of the
conditions to closing set forth in Section 8 hereof, the Seller does hereby
sell, transfer, assign, set over and otherwise convey to the Purchaser, without
recourse, all the right, title and interest of the Seller (other than the
primary servicing rights) in and to the Mortgage Loans identified on the
Mortgage Loan Schedule as of such date. The Mortgage Loan Schedule, as it may be
amended, shall conform to the requirements set forth in this Agreement and the
Pooling and Servicing Agreement.
(b) The Purchaser or its assignee shall be entitled to receive all
scheduled payments of principal and interest due after the Cut-off Date, and all
other recoveries of principal and interest collected after the Cut-off Date
(other than in respect of principal and interest on the Mortgage Loans due on or
before the Cut-off Date). All scheduled payments of principal and interest due
on or before the Cut-off Date for each Mortgage Loan, but collected after such
date, shall belong to, and be promptly remitted to, the Seller.
(c) On or before the Closing Date, the Seller shall, on behalf of the
initial Purchaser, deliver to and deposit with (i) the Trustee or a Custodian
appointed thereby, a Mortgage File for each Mortgage Loan in accordance with the
terms of, and conforming to the requirements set forth in, the Pooling and
Servicing Agreement, with copies of each Mortgage File to be delivered by the
Trustee to, upon request, the Master Servicer (at the expense of the Trustee),
within 10 Business Days of such request; and (ii) the Master Servicer (or, at
the direction of the Master Servicer, to the appropriate Sub-Servicer), all
unapplied Escrow Payments and Reserve Funds in th In addition, the Seller shall
deliver to and deposit with the Master Servicer, within 45 days of the Closing
Date, a copy of the mortgage file that was delivered to the related Outside
Trustee with respect to the 000 Xxxxxxx Xxxxxx Trust Mortgage Loan under the
related Non Trust Mortgage Loan Securitization Agreement..
(d) The Seller shall, through an Independent third party (the
"Recording Agent") retained by it, as and in the manner provided in the Pooling
and Servicing Agreement (and in any event within 45 days following the later of
the Closing Date and the date on which all necessary recording information is
available to the Recording Agent), cause (i) each assignment of Mortgage and
each assignment of Assignment of Leases, in favor of, and delivered as part of
the related Mortgage File to the Trustee, to be submitted for recordation in the
appropriate public office for real property records, and (ii) such assignments
to be delivered to the Trustee following their return by the applicable public
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recording office, with copies of any such returned assignments to be delivered
by the Trustee to the Master Servicer, at the expense of the Seller, at least
every 90 days after the Closing Date (or at additional times upon the request of
the Master Servicer if reasonably necessary for the ongoing administration
and/or servicing of the related Mortgage Loan by the Master Servicer); provided
that, in those instances where the public recording office retains the original
assignment of Mortgage or assignment of Assignment of Leases, a certified copy
of the recorded original shall be forwarded to the Trustee. If any such document
or instrument is lost or returned unrecorded because of a defect therein, then
the Seller shall prepare a substitute therefor or cure such defect or cause such
to be done, as the case may be, and the Seller shall deliver such substitute or
corrected document or instrument to the Trustee (or, if the Mortgage Loan is
then no longer subject to the Pooling and Servicing Agreement, to the then
holder of such Mortgage Loan).
The Seller shall bear the out-of-pocket costs and expenses of all such
recording and delivery contemplated in the preceding paragraph, including,
without limitation, any out-of-pocket costs and expenses that may be incurred by
the Trustee in connection with any such recording or delivery performed by the
Trustee at the Seller's request and the fees of the Recording Agent.
Pursuant to the Pooling and Servicing Agreement and a letter agreement
dated June 29, 2006 (the "Filing Letter Agreement") between American Capital
Strategies Ltd. (the "Payee"), the Depositor, the UBS Mortgage Loan Seller and
the Trustee, the Trustee, through a third party (the "Filing Agent") retained by
it, as and in the manner provided in the Pooling and Servicing Agreement and at
the expense of the Payee (and in any event within 45 days following the later of
the Closing Date and the date on which all necessary filing information is
available to the Filing Agent), is required to cause (i) each assignment of
Uniform Commercial Code financing statements prepared by the Seller, in favor
of, and delivered as part of the related Mortgage File to the Trustee, to be
submitted for filing in the appropriate public office, and (ii) such assignments
to be delivered to the Trustee following their return by the applicable public
filing office, with copies of any such returned assignments to be delivered by
the Trustee to the Master Servicer, at the expense of the Seller, at least every
90 days after the Closing Date (or at additional times upon the request of the
Master Servicer if reasonably necessary for the ongoing administration and/or
servicing of the related Mortgage Loan by the Master Servicer). The Seller
hereby agrees to reasonably cooperate with the Trustee and the Filing Agent with
respect to the filing of the assignments of Uniform Commercial Code financing
statements as described in this paragraph and to forward to the Trustee filing
confirmation, if any, received in connection with such Uniform Commercial Code
financing statements filed in accordance with this paragraph. Notwithstanding
the foregoing, to the extent the Trustee provides the Payee, pursuant to the
Filing Letter Agreement, with an invoice for the expenses (i) reasonably to be
incurred in connection with the filings referred to in this paragraph and (ii)
required to be paid by the Payee pursuant to the Filing Letter Agreement, and
such expenses are not paid by the Payee in advance of such filings, the Trustee,
pursuant to the Pooling and Servicing Agreement and the Filing Letter Agreement
and at the expense of the Seller, shall only be required to cause the filing
agent to file the assignments of such Uniform Commercial Code financing
statements with respect to Mortgage Loans secured by hotel or hospitality
properties.
(e) With respect to any Mortgage Loan, the following documents (other
than any document that constitutes part of the Mortgage File for such Mortgage
Loan): copies of any final appraisal, final survey, final engineering report,
final environmental report, opinion letters of counsel to the related mortgagor
delivered in connection with the closing of such Mortgage Loan, escrow
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agreements, reserve agreements, organization documentation for the related
mortgagor, organizational documentation for any related guarantor or indemnitor,
if the related guarantor or indemnitor is an entity, insurance certificates or
insurance review reports, leases for tenants representing 10% or more of the
annual income with respect to the related Mortgaged Property, final seismic
report and property management agreements, rent roll, property operating
statement and financial statements for the related guarantor or indemnitor, cash
management or lockbox agreement, zoning letters or zoning reports and the
documents, if any, specifically set forth on Exhibit C hereto (collectively, the
"Mortgage Origination Documents"), but in each case, only if the subject
document (a) was in fact obtained in connection with the origination of such
Mortgage Loan, (b) is reasonably necessary for the ongoing administration and/or
servicing of such Mortgage Loan by the Master Servicer or Special Servicer in
connection with its duties under the Pooling and Servicing Agreement, and (c) is
in the possession or under the control of the Seller shall, within 45 days of
the Closing Date, be delivered or caused to be delivered by the Seller to the
Master Servicer (or, at the direction of the Master Servicer, to the appropriate
Sub-Servicer); provided that the Seller shall not be required to deliver any
draft documents, privileged or other communications or correspondence, credit
underwriting or due diligence analyses or information, credit committee briefs
or memoranda or other internal approval documents or data or internal
worksheets, memoranda, communications or evaluations.
(f) After the Seller's transfer of the Mortgage Loans to the
Purchaser, as provided herein, the Seller shall not take any action inconsistent
with the Purchaser's ownership of the Mortgage Loans. Except for actions that
are the express responsibility of another party hereunder or under the Pooling
and Servicing Agreement, and further except for actions that the Seller is
expressly permitted to complete subsequent to the Closing Date, the Seller
shall, on or before the Closing Date, take all actions required under applicable
law to effectuate the transfer of the Mortgage Loans by the Seller to the
Purchaser.
(g) In connection with the obligations of the Master Servicer under
Sections 3.01(e) and 3.19(c) of the Pooling and Servicing Agreement, with regard
to each Mortgage Loan that is secured by the interests of the related Mortgagor
in a hospitality property (identified on Schedule VI to the Pooling and
Servicing Agreement) and each Mortgage Loan that has a related letter of credit,
the Seller shall deliver to and deposit with the Master Servicer, on or before
the Closing Date, any related franchise agreement, franchise comfort letter and
the original of such letter of credit. Further, in the event, with respect to a
Mortgage Loan with a related letter of credit, the Master Servicer determines
that a draw under such letter of credit has become necessary under the terms
thereof prior to the assignment of such letter of credit having been effected in
accordance with Section 3.01(e) of the Pooling and Servicing Agreement, the
Seller shall, upon the written direction of the Master Servicer, use its best
efforts to make such draw or to cause such draw to be made on behalf of the
Trustee.
(h) Pursuant to the Pooling and Servicing Agreement, the Master
Servicer shall review the documents with respect to each Mortgage Loan delivered
by the Seller pursuant to or as contemplated by Section 2(e) hereof and provide
each Seller and the Controlling Class Representative and the Special Servicer
with a certificate (the "Master Servicer Certification") within 90 days of the
Closing Date acknowledging its (or the appropriate Sub-Servicer's) receipt as of
the date of the Master Servicer Certification of such documents actually
received (provided that such review shall be limited to identifying the document
received, the Serviced Trust Mortgage Loan to which it purports to relate, that
it appears regular on its face and that it appears to have been executed (where
appropriate)). Notwithstanding anything to the contrary set forth herein, to the
extent the Seller has not been notified in
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writing of its failure to deliver any document with respect to a Mortgage Loan
required to be delivered pursuant to or as contemplated by Section 2(e) hereof
prior to the date occurring 18 months following the date of the Master Servicer
Certification, the Seller shall have no obligation to provide such document.
(i) In addition, on the Closing Date, the Seller shall deliver to the
Master Servicer for deposit in the Pool Custodial Account, the Initial Deposits
relating to the Mortgage Loans.
SECTION 3. Representations, Warranties and Covenants of Seller.
(a) The Seller hereby represents and warrants to and covenants with
the Purchaser, as of the date hereof, that:
(i) The Seller is duly organized or formed, as the case may be,
validly existing and in good standing as a legal entity under the laws of
the State of Delaware and possesses all requisite authority, power,
licenses, permits and franchises to carry on its business as currently
conducted by it and to execute, deliver and comply with its obligations
under the terms of this Agreement.
(ii) This Agreement has been duly and validly authorized,
executed and delivered by the Seller and, assuming due authorization,
execution and delivery hereof by the Purchaser, constitutes a legal, valid
and binding obligation of the Seller, enforceable against the Seller in
accordance with its terms, except as such enforcement may be limited by (A)
bankruptcy, insolvency, reorganization, receivership, moratorium or other
similar laws affecting the enforcement of creditors' rights in general, and
(B) general equity principles (regardless of whether such enforcement is
considered in a proceeding in equity or at law).
(iii) The execution and delivery of this Agreement by the Seller
and the Seller's performance and compliance with the terms of this
Agreement will not (A) violate the Seller's organizational documents, (B)
violate any law or regulation or any administrative decree or order to
which the Seller is subject or (C) 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 contract, agreement or other
instrument to which the Seller is a party or by which the Seller is bound.
(iv) The Seller is not in default with respect to any order or
decree of any court or any order, regulation or demand of any federal,
state, municipal or other governmental agency or body, which default might
have consequences that would, in the Seller's reasonable and good faith
judgment, materially and adversely affect the condition (financial or
other) or operations of the Seller or its properties or have consequences
that would materially and adversely affect its performance hereunder.
(v) The Seller is not a party to or bound by any agreement or
instrument or subject to any organizational document or any other corporate
or limited liability company (as applicable) restriction or any judgment,
order, writ, injunction, decree, law or regulation that would, in the
Seller's reasonable and good faith judgment, materially and adversely
affect the ability of the Seller to perform its obligations under this
Agreement or that requires the consent
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of any third person to the execution and delivery of this Agreement by the
Seller or the performance by the Seller of its obligations under this
Agreement.
(vi) Except for the recordation and/or filing of assignments and
other transfer documents with respect to the Mortgage Loans, as
contemplated by Section 2(d) hereof, no consent, approval, authorization or
order of, registration or filing with, or notice to, any court or
governmental agency or body, is required for the execution, delivery and
performance by the Seller of or compliance by the Seller with this
Agreement or the consummation of the transactions contemplated by this
Agreement; and no bulk sale law applies to such transactions.
(vii) No litigation is pending or, to the best of the Seller's
knowledge, threatened against the Seller that would, in the Seller's good
faith and reasonable judgment, prohibit its entering into this Agreement or
materially and adversely affect the performance by the Seller of its
obligations under this Agreement.
(viii) No proceedings looking toward merger, liquidation,
dissolution or bankruptcy of the Seller are pending or contemplated.
In addition, the Seller hereby further represents and warrants to, and
covenants with, the Purchaser, as of the date hereof, that:
(i) Under generally accepted accounting principles ("GAAP") and
for federal income tax purposes, the Seller will report the transfer of the
Mortgage Loans to the Purchaser, as provided herein, as a sale of the
Mortgage Loans to the Purchaser in exchange for the consideration specified
in Section 1 hereof. In connection with the foregoing, the Seller shall
cause all of its records to reflect such transfer as a sale (as opposed to
a secured loan). The consideration received by the Seller upon the sale of
the Mortgage Loans to the Purchaser will constitute at least reasonably
equivalent value and fair consideration for the Mortgage Loans. The Seller
will be solvent at all relevant times prior to, and will not be rendered
insolvent by, the sale of the Mortgage Loans to the Purchaser. The Seller
is not selling the Mortgage Loans to the Purchaser with any intent to
hinder, delay or defraud any of the creditors of the Seller. After giving
effect to its transfer of the Mortgage Loans to the Purchaser, as provided
herein, the value of the Seller's assets, either taken at their present
fair saleable value or at fair valuation, will exceed the amount of the
Seller's debts and obligations, including contingent and unliquidated debts
and obligations of the Seller, and the Seller will not be left with
unreasonably small assets or capital with which to engage in and conduct
its business. The Mortgage Loans do not constitute all or substantially all
of the assets of the Seller. The Seller does not intend to, and does not
believe that it will, incur debts or obligations beyond its ability to pay
such debts and obligations as they mature.
(ii) The Seller will acquire the Seller's Residual Interest
Certificates for its own account and not with a view to, or sale or
transfer in connection with, any distribution thereof, in whole or in part,
in any manner that would violate the Securities Act or any applicable state
securities laws.
(iii) The Seller understands that (A) the Seller's Residual
Interest Certificates have not been and will not be registered under the
Securities Act or registered or qualified under any applicable state
securities laws, (B) neither the Purchaser nor any other party is obligated
so
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to register or qualify the Seller's Residual Interest Certificates and (C)
neither the Seller's Residual Interest Certificates nor any security issued
in exchange therefor or in lieu thereof may be resold or transferred unless
it is (1) registered pursuant to the Securities Act and registered or
qualified pursuant to any applicable state securities laws or (2) sold or
transferred in a transaction which is exempt from such registration and
qualification and the Certificate Registrar has received the certifications
and/or opinions of counsel required by the Pooling and Servicing Agreement.
(iv) The Seller understands that it may not sell or otherwise
transfer the Seller's Residual Interest Certificates, any security issued
in exchange therefor or in lieu thereof or any interest in the foregoing
except in compliance with the provisions of Section 5.02 of the Pooling and
Servicing Agreement, which provisions it has or, as of the Closing Date,
will have carefully reviewed, and that the Seller's Residual Interest
Certificates will bear legends that identify the transfer restrictions to
which such Certificates are subject.
(v) Neither the Seller nor anyone acting on its behalf has (A)
offered, transferred, pledged, sold or otherwise disposed of any Seller's
Residual Interest Certificate, any interest in a Seller's Residual Interest
Certificate or any other similar security to any person in any manner, (B)
solicited any offer to buy or accept a transfer, pledge or other
disposition of any Seller's Residual Interest Certificate, any interest in
a Seller's Residual Interest Certificate or any other similar security from
any person in any manner, (C) otherwise approached or negotiated with
respect to any Seller's Residual Interest Certificate, any interest in a
Seller's Residual Interest 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, or (E) taken any other action,
that (in the case of any of the acts described in clauses (A) through (E)
above) would constitute a distribution of the Seller's Residual Interest
Certificates under the Securities Act, would render the disposition of the
Seller's Residual Interest Certificates a violation of Section 5 of the
Securities Act or any state securities law or would require registration or
qualification of the Seller's Residual Interest Certificates pursuant
thereto. The Seller will not act, nor has it authorized nor will it
authorize any person to act, in any manner set forth in the foregoing
sentence with respect to the Seller's Residual Interest Certificates, any
interest in the Seller's Residual Interest Certificates or any other
similar security.
(vi) The Seller has been furnished with all information regarding
(A) the Purchaser, (B) the Seller's Residual Interest Certificates and
distributions thereon, (C) the nature, performance and servicing of the
Other Loans, (D) the Pooling and Servicing Agreement and the Trust Fund,
and (E) all related matters, that it has requested.
(vii) The Seller is either (a) a "qualified institutional buyer"
within the meaning of Rule 144A under the Securities Act or (b) an
"accredited investor" as defined in any of paragraphs (1), (2), (3) and (7)
of Rule 501(a) under the Securities Act or an entity in which all its
equity owners are "accredited investors" as defined in such paragraphs and
has such knowledge and experience in financial and business matters as to
be capable of evaluating the merits and risks of an investment in the
Seller's Residual Interest Certificates. The Seller has sought such
accounting, legal and tax advice as it has considered necessary to make an
informed investment decision; and the Seller is able to bear the economic
risks of such an investment and can afford a complete loss of such
investment.
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(viii) The Seller is not a Plan and is not directly or indirectly
acquiring the Seller's Residual Interest Certificates on behalf of, as
named fiduciary of, as trustee of or with assets of a Plan.
(ix) The Seller is a United States Tax Person and is not a
Disqualified Organization.
(b) The Seller hereby makes, for the benefit of the Purchaser, with
respect to each Mortgage Loan, as of the Closing Date or as of such other date
expressly set forth therein, each of the representations and warranties set
forth on Exhibit B hereto.
(c) The Seller intends to transfer the Seller's Residual Interest
Certificates to Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated on or about
the Closing Date; and, in connection therewith, the Seller will comply with all
of the requirements of Section 5.02 of the Pooling and Servicing Agreement, as
in effect on the Closing Date, and applicable law. The Seller hereby directs the
Purchaser to cause the Seller's Residual Interest Certificates to be registered
in the name of Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated upon initial
issuance.
SECTION 4. Representations and Warranties of the Purchaser.
In order to induce the Seller to enter into this Agreement, the
Purchaser hereby represents and warrants for the benefit of the Seller as of the
date hereof that:
(i) The Purchaser is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware. The
Purchaser has the full corporate power and authority and legal right to
acquire the Mortgage Loans from the Seller and to transfer the Mortgage
Loans to the Trustee.
(ii) This Agreement has been duly and validly authorized,
executed and delivered by the Purchaser and, assuming due authorization,
execution and delivery hereof by the Seller, constitutes a legal, valid and
binding obligation of the Purchaser, enforceable against the Purchaser in
accordance with its terms, except as such enforcement may be limited by (A)
bankruptcy, insolvency, reorganization, receivership, moratorium or other
similar laws affecting the enforcement of creditors' rights in general, and
(B) general equity principles (regardless of whether such enforcement is
considered in a proceeding in equity or at law).
(iii) The execution and delivery of this Agreement by the
Purchaser and the Purchaser's performance and compliance with the terms of
this Agreement will not (A) violate the Purchaser's organizational
documents, (B) violate any law or regulation or any administrative decree
or order to which the Purchaser is subject or (C) 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 contract,
agreement or other instrument to which the Purchaser is a party or by which
the Purchaser is bound.
(iv) Except as may be required under federal or state securities
laws (and which will be obtained on a timely basis), no consent, approval,
authorization or order of, registration or filing with, or notice to, any
governmental authority or court, is required for the execution, delivery
and performance by the Purchaser of or compliance by the Purchaser with
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this Agreement, or the consummation by the Purchaser of any transaction
described in this Agreement.
(v) Under GAAP and for federal income tax purposes, the Purchaser
will report the transfer of the Mortgage Loans by the Seller to the
Purchaser, as provided herein, as a sale of the Mortgage Loans to the
Purchaser in exchange for the consideration specified in Section 1 hereof.
SECTION 5. Notice of Breach; Cure; Repurchase.
(a) If the Seller receives written notice or obtains actual knowledge
with respect to any Mortgage Loan (i) that any document constituting a part of
clauses (a)(i) through (a)(xiii) (or, in the case of the Outside Serviced Trust
Mortgage Loan, clause(b)(i)) of the definition of Mortgage File or a document,
if any, specifically set forth on Exhibit D hereto, has not been executed (if
applicable) or is missing (a "Document Defect") or (ii) of a breach of any of
the Seller's representations and warranties made pursuant to Section 3(b) hereof
(each such breach, a "Breach") relating to any Mortgage Loan, and such Document
Defect or Breach, as of the date specified in Section 5(b)(i) hereof, materially
and adversely affects the value of the Mortgage Loan, then such Document Defect
shall constitute a "Material Document Defect" or such Breach shall constitute a
"Material Breach", as the case may be. In the event the Seller obtains actual
knowledge of a Material Document Defect or Material Breach, then the Seller
shall deliver written notification to the Trustee with respect thereto. Then,
following receipt by the Seller of a Seller/Depositor Notification with respect
to such Material Document Defect or Material Breach, as the case may be, the
Seller shall (subject to Sections 5(f), (g) and (h) hereof), (A) not later than
(1) 30 days after the Seller and the Purchaser have agreed upon the existence of
such Material Document Defect or Material Breach or (2) 30 days after an
arbitration panel makes a binding determination, in accordance with the
provisions of Section 5(i) hereof, that a Material Document Defect or Material
Breach exists or (B) in the case of a Material Document Defect or Material
Breach that affects whether a Mortgage Loan was, as of the Closing Date, is or
will continue to be a "qualified mortgage" within the meaning of the REMIC
Provisions (a "Qualified Mortgage"), not later than 90 days following the
discovery by any party of such Material Document Defect or Material Breach (each
of such 30-day period referred to in clause (A)(1) above, or such 30-day period
referred to in clause (A)(2) above, or such 90-day period referred to in clause
(B) above, as applicable, is referred to as the "Initial Resolution Period"):
(i) cure such Material Document Defect or Material Breach, as the case may be,
in all material respects (which cure shall include payment of any out-of-pocket
expenses that are reasonably incurred and directly attributable to pursuing such
a claim based on such Material Document Defect or Material Breach associated
therewith), or (ii) if such Material Document Defect or Material Breach, as the
case may be, cannot be cured within the Initial Resolution Period, repurchase
the affected Mortgage Loan (or the related Mortgaged Property) from, and in
accordance with the directions of, the Purchaser or its designee, at a price
equal to the Purchase Price; provided that if (a) such Material Breach or
Material Document Defect, as the case may be, is capable of being cured but not
within the applicable Initial Resolution Period, (b) any such Material Breach or
Material Document Defect, as the case may be, does not affect whether the
Mortgage Loan was, as of the Closing Date, is or will continue to be a Qualified
Mortgage, (c) the Seller has commenced and is diligently proceeding with the
cure of such Material Breach or Material Document Defect, as the case may be,
within the applicable Initial Resolution Period, and (d) the Seller shall have
delivered to the Purchaser a certification executed on behalf of the Seller by
an officer thereof confirming that such Material Breach or Material Document
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Defect, as the case may be, is not capable of being cured within the applicable
Initial Resolution Period, setting forth what actions the Seller is pursuing in
connection with the cure thereof and stating that the Seller anticipates that
such Material Breach or Material Document Defect, as the case may be, will be
cured within an additional period not to exceed, 90 days beyond the end of the
Initial Resolution Period (in the event the Seller and the Purchaser have agreed
upon the existence of such Material Document Defect or Material Breach as
described under Section 5(a)(ii)(A)(1)), or 45 days beyond the end of the
Initial Resolution Period (in the event an arbitration panel has made a binding
determination, as described under Section 5(a)(ii)(A)(2) hereof, that a Material
Document Defect or Material Breach exists), then the Seller shall have such
additional 90-day period or 45-day period, as the case may be (each such period,
the "Resolution Extension Period"), to complete such cure or, failing such, to
repurchase the affected Mortgage Loan (or the related Mortgaged Property); and
provided, further, that, if any such Material Document Defect is still not cured
after the Initial Resolution Period and any such applicable Resolution Extension
Period solely due to the failure of the Seller to have received a recorded
document, then the Seller shall be entitled to continue to defer its cure and
repurchase obligations in respect of such Material Document Defect so long as
the Seller certifies to the Purchaser every six months thereafter that the
Material Document Defect is still in effect solely because of its failure to
have received the recorded document and that the Seller is diligently pursuing
the cure of such defect (specifying the actions being taken). The parties
acknowledge that neither delivery of a certification or schedule of exceptions
to the Seller pursuant to Section 2.02(b) of the Pooling and Servicing Agreement
or otherwise nor possession of such certification or schedule by the Seller
shall, in and of itself, constitute delivery of notice of any Material Document
Defect or Material Breach or knowledge or awareness by the Seller of any
Material Document Defect or Material Breach.
If, during the period of deferral by the Seller of its cure and
repurchase obligations as contemplated by the last proviso of the penultimate
sentence of the preceding paragraph, the Mortgage Loan that is the subject of
the Material Document Defect either becomes a Specially Serviced Mortgage Loan
or becomes the subject of a proposed or actual assumption of the obligations of
the related Mortgagor under such Mortgage Loan, then, following receipt by the
Seller of a Seller/Depositor Notification providing notice of such event, the
Seller shall cure the subject Material Document Defect within the time period
specified in such Seller/Depositor Notification. If, upon the expiration of such
period, the Seller has failed to cure the subject Material Document Defect, the
Master Servicer or the Special Servicer, as applicable, shall be entitled (but
not obligated) to perform the obligations of the Seller with respect to curing
the subject Material Document Defect and, in the event of such an election, the
Seller shall pay all reasonable actual out-of-pocket costs and expenses in
connection with the applicable servicer's effecting such cure.
(b) (i) Provided that any Seller/Depositor Notification with respect
to a Material Document Defect or Material Breach is received by the Seller in
accordance with the provisions of the Pooling and Servicing Agreement), within
24 months of the Closing Date, the material and adverse effect of the related
Document Defect or Breach shall be determined as of the date hereof. After the
expiration of 24 months following the Closing Date, the material and adverse
effect of any Document Defect or Breach that was not the subject of another
Seller/Depositor Notification, received by the Seller (in accordance with the
provisions of the Pooling and Servicing Agreement), within 24 months of the
Closing Date, shall be determined as of the date of such Seller/Depositor
Notification.
(ii) In the event the Seller is obligated to repurchase any
Mortgage Loan pursuant to this Section 5, such obligation shall extend to
any successor REO Mortgage Loan
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with respect thereto as to which (A) the subject Material Breach existed as
to the subject predecessor Mortgage Loan prior to the date the related
Mortgaged Property became an REO Property or within 90 days thereafter, and
(B) as to which the Seller had received, no later than 90 days following
the date on which the related Mortgaged Property became an REO Property, a
Seller/Depositor Notification from the Trustee regarding the occurrence of
the applicable Material Breach and directing the Seller to repurchase the
subject Mortgage Loan.
(c) If one or more (but not all) of the Mortgage Loans constituting a
Cross-Collateralized Group are to be repurchased by the Seller as contemplated
by Section 5(a) hereof, then, prior to the subject repurchase, the Seller or its
designee shall use reasonable efforts, subject to the terms of the related
Mortgage Loans, to prepare and, to the extent necessary and appropriate, have
executed by the related Mortgagor and record, such documentation as may be
necessary to terminate the cross-collateralization between the Mortgage Loans in
such Cross-Collateralized Group that are to be repurchased, on the one hand, and
the remaining Mortgage Loans therein, on the other hand, such that those two
groups of Mortgage Loans are each secured only by the Mortgaged Properties
identified in the Mortgage Loan Schedule as directly corresponding thereto;
provided that, if such Cross-Collateralized Group is still subject to the
Pooling and Servicing Agreement, then no such termination shall be effected
unless and until (i) the Purchaser or its designee has received from the Seller
(A) an Opinion of Counsel to the effect that such termination will not cause an
Adverse REMIC Event to occur with respect to any REMIC Pool or an Adverse
Grantor Trust Event with respect to the Grantor Trust and (B) written
confirmation from each Rating Agency that such termination will not cause an
Adverse Rating Event to occur with respect to any Class of Certificates and (ii)
the Controlling Class Representative (if one is acting) has consented (which
consent shall not be unreasonably withheld and shall be deemed to have been
given if no written objection is received by the Seller within 10 Business Days
of the Controlling Class Representative's receipt of a written request for such
consent); and provided, further, that the Seller may, at its option, purchase
the entire Cross-Collateralized Group in lieu of terminating the
cross-collateralization. All costs and expenses incurred by the Purchaser or its
designee pursuant to this paragraph shall be included in the calculation of
Purchase Price for the Mortgage Loan(s) to be repurchased. If the
cross-collateralization of any Cross-Collateralized Group is not or cannot be
terminated as contemplated by this paragraph, then, for purposes of (i)
determining whether the subject Breach or Document Defect, as the case may be,
materially and adversely affects the value of such Cross-Collateralized Group,
and (ii) the application of remedies, such Cross-Collateralized Group shall be
treated as a single Mortgage Loan.
(d) It shall be a condition to any repurchase of a Mortgage Loan by
the Seller pursuant to this Section 5 that the Purchaser shall have executed and
delivered such instruments of transfer or assignment then presented to it by the
Seller (or as otherwise required to be prepared, executed and delivered under
the Pooling and Servicing Agreement), in each case without recourse, as shall be
necessary to vest in the Seller the legal and beneficial ownership of such
Mortgage Loan (including any property acquired in respect thereof or proceeds of
any insurance policy with respect thereto), to the extent that such ownership
interest was transferred to the Purchaser hereunder. If any Mortgage Loan is to
be repurchased as contemplated by this Section 5, the Seller shall amend the
Mortgage Loan Schedule to reflect the removal of such Mortgage Loan and shall
forward such amended schedule to the Purchaser.
(e) Any repurchase of a Mortgage Loan pursuant to this Section 5 shall
be on a whole loan, servicing released basis. The Seller shall have no
obligation to monitor the Mortgage Loans
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regarding the existence of a Breach or Document Defect. It is understood and
agreed that the obligations of the Seller set forth in this Section 5 constitute
the sole remedies available to the Purchaser with respect to any Breach or
Document Defect.
(f) Notwithstanding the foregoing, if there exists a Breach of that
portion of the representation or warranty on the part of the Seller set forth
in, or made pursuant to, paragraph (xlviii) of Exhibit B to this Agreement,
specifically relating to whether or not the Mortgage Loan documents or any
particular Mortgage Loan document for any Mortgage Loan requires the related
Mortgagor to bear the reasonable costs and expenses associated with the subject
matter of such representation or warranty, as set forth in such representation
or warranty, then the Purchaser or its designee will direct the Seller in
writing to wire transfer to the Custodial Account, within 90 days of receipt of
such direction, the amount of any such reasonable costs and expenses incurred by
the Trust that (i) are due from the Mortgagor, (ii) otherwise would have been
required to be paid by the Mortgagor if such representation or warranty with
respect to such costs and expenses had in fact been true, as set forth in the
related representation or warranty, (iii) have not been paid by the Mortgagor,
(iv) are the basis of such Breach and (v) constitute "Covered Costs". Upon
payment of such costs, the Seller shall be deemed to have cured such Breach in
all respects. Provided that such payment is made, this paragraph describes the
sole remedy available to the Purchaser regarding any such Breach, regardless of
whether it constitutes a Material Breach, and the Seller shall not be obligated
to otherwise cure such Breach or repurchase the affected Mortgage Loan under any
circumstances. Amounts deposited in the Pool Custodial Account pursuant to this
paragraph shall constitute "Liquidation Proceeds" for all purposes of the
Pooling and Servicing Agreement (other than Section 3.11(c) of the Pooling and
Servicing Agreement).
(g) Subject to Section 5(f) hereof and the last three sentences of
this paragraph, if the Seller determines that a Material Breach (other than a
Material Breach of a representation or warranty on the part of the Seller set
forth in and made pursuant to paragraph (xvii) of Exhibit B to this Agreement)
or a Material Document Defect with respect to a Mortgage Loan is not capable of
being cured in accordance with Section 5(a) hereof, then in lieu of repurchasing
such Mortgage Loan the Seller may, at its sole option, pay a cash amount equal
to the loss of value (each such payment, a "Loss of Value Payment") with respect
to such Mortgage Loan, which loss of value is directly attributed to such
Material Breach or Material Document Defect, as the case may be. The amount of
each such Loss of Value Payment shall be determined either (i) by mutual
agreement of the Special Servicer on behalf of the Trust with respect to the
subject Material Breach or Material Document Defect, as the case may be, and the
Seller, or (ii) by an arbitration panel pursuant to a binding arbitration
proceeding in accordance with Section 5(i) hereof; provided that, in the event
there is an arbitration proceeding for determining the existence of a Material
Breach or a Material Document Defect with respect to any Mortgage Loan, such
arbitration proceeding must also include a determination of the amount of the
loss of value to such Mortgage Loan directly attributed to such Material Breach
or such Material Document Defect, as the case may be. Provided that such payment
is made, this paragraph describes the sole remedy available to the Purchaser
regarding any such Material Breach or Material Document Defect and the Seller
shall not be obligated to otherwise cure such Material Breach or Material
Document Defect or repurchase the affected Mortgage Loan based on such Material
Breach or Material Document Defect under any circumstances. Notwithstanding the
foregoing provisions of this Section 5(g), if 95% or more of the loss of value
to a Mortgage Loan was caused by a Material Breach or Material Document Defect,
which Material Breach or Material Document Defect is not capable of being cured,
this Section 5(g) shall not apply and the Seller shall be obligated to
repurchase the affected Mortgage Loan at the applicable Purchase Price in
accordance with Section 5(a) hereof. Furthermore, the Seller shall not have the
option
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of delivering Loss of Value Payments in connection with any Material Breach
relating to a Mortgage Loan's failure to be a Qualified Mortgage. In the event
there is a Loss of Value Payment made by the Seller in accordance with this
Section 5(g), the amount of such Loss of Value Payment shall be deposited into
the Loss of Value Reserve Fund to be applied in accordance with Section 3.05(e)
of the Pooling and Servicing Agreement.
In the event the amount of any Loss of Value Payment is determined by
an arbitration panel pursuant to a binding arbitration proceeding in accordance
with Section 5(i) hereof, then such Loss of Value Payment shall also include the
payment of any costs and expenses (including costs incurred in establishing the
amount of any related loss of value to the subject Mortgage Loan, including
reasonable legal fees) that are reasonably incurred in good faith by the Master
Servicer, the Special Servicer and/or the Trustee (on behalf of the Trust) in
enforcing the rights of the Trust against the Seller with respect to the subject
Material Breach or Material Document Defect, as the case may be; provided that,
that in the event the Seller tenders a loss of value payment in a specified
amount in connection with a Material Breach or Material Document Defect, as the
case may be, prior to the institution of arbitration proceedings and that offer
is rejected and an amount equal to or less than the loss of value payment
originally tendered by the Seller is ultimately determined by an arbitration
panel pursuant to a binding arbitration proceeding in accordance with Section
5(i) hereof to be the actual amount of the Loss of Value Payment attributed to
such Material Breach or Material Document Defect, as the case may be, then that
Loss of Value Payment shall not include the payment of any costs or expenses
incurred in enforcing the rights of the Trust against the Seller with respect to
the subject Material Breach or Material Document Defect, as the case may be;
provided, further, that if the Special Servicer request a loss of value payment
from the Seller of a specified amount in connection with a Material Breach or
Material Document Defect, as the case may be, and the Seller refuses to pay that
amount and an amount equal to or greater than the loss of value payment
originally requested by the Special Servicer is ultimately determined by an
arbitration panel pursuant to a binding arbitration proceeding in accordance
with Section 5(i) hereof to be the actual Loss of Value Payment attributable to
such Material Document Defect or Material Breach, then that Loss of Value
Payment shall also include the payment of any costs or expenses reasonably
incurred in good faith in enforcing the rights of the Trust against the Seller
with respect to the subject Material Breach or Material Document Defect, as the
case may be; and provided, further, that, if the Seller tenders a loss of value
payment in connection with a Material Breach or Material Document Defect, as the
case may be, in a specified amount, and the Special Servicer rejects such tender
and requests a greater loss of value payment amount, and an amount in between
the respective amounts tendered and requested is ultimately determined by an
arbitration panel pursuant to a binding arbitration proceeding in accordance
with Section 5(i) hereof to be the actual Loss of Value Payment attributable to
such Material Breach or Material Document Defect, as the case may be, then that
Loss of Value Payment shall also include the payment of an amount equal to the
product of (i) all costs and expenses reasonably incurred in connection with
that arbitration proceeding, multiplied by (ii) a fraction, the numerator of
which is the excess of the amount determined by that arbitration proceeding over
the amount tendered by the Seller, and the denominator of which is the excess of
the amount requested by the Special Servicer over the amount tendered by the
Seller. Notwithstanding the foregoing, in the event any Loss of Value Payment is
determined by the parties hereto by mutual agreement (and not by an arbitration
proceeding), that Loss of Value Payment shall not include any costs and expenses
incurred by the Master Servicer, the Special Servicer or the Trustee unless such
costs and expenses were specifically included in such mutual agreement.
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(h) Notwithstanding the foregoing, if there exists a Material Breach
of the representation or warranty on the part of the Seller set forth in and
made pursuant to paragraph (xvii) of Exhibit B to this Agreement, and the
subject Mortgage Loan becomes a Qualified Mortgage prior to the expiration of
the Initial Resolution Period applicable to a Material Document Defect or
Material Breach that affects whether a Mortgage Loan is a Qualified Mortgage,
and without otherwise causing an Adverse REMIC Event or an Adverse Grantor Trust
Event, then such breach will be cured and the Seller will not be obligated to
repurchase or otherwise remedy such Breach.
(i) The parties hereto agree that any controversy or claim (a
"Dispute") arising under Section 5(a), Section 5(b) and/or Section 5(g) of this
Agreement shall be resolved in accordance with the following
Mediation/Arbitration procedures in this Section 5(i).
If the Seller receives a Seller/Depositor Notification pursuant to
Section 5(a) of this Agreement regarding the alleged existence of a Material
Document Defect or Material Breach and requesting the Seller to cure or
repurchase the affected Mortgage Loan in connection therewith (a "Notice"), and
the Seller does not agree upon the existence of such Material Document Defect or
Material Breach within 90 days of receiving such Notice, then, unless otherwise
agreed to by the parties involved in the Dispute, that Dispute shall be
submitted to non-binding mediation in accordance with the provisions of this
paragraph; provided, that if the Seller is proceeding to cure the subject
Material Document Defect or Material Breach, then that Dispute shall not be
submitted to mediation until the expiration of the related Resolution Extension
Period and the failure of the Seller to complete such cure (unless otherwise
agreed to by the parties involved in the Dispute). Following the 90-day period
referred to in the preceding sentence and subject to the preceding proviso, any
party to this Agreement that is involved in the Dispute may send a written
letter (a "Mediation Letter") to another party to this Agreement that they wish
the mediation process to begin between the sender and the recipient of such
Mediation Letter. Following receipt of a Mediation Letter, a mediator(s) shall
be selected by agreement of the parties to the mediation. If such parties cannot
agree on a mediator, [a mediator will be designated by the JAMS/Endispute at the
request of any party (provided that any mediator so designated must be
acceptable to both the Seller and the Purchaser or its assignee)] [then the
mediation shall be conducted by three mediators, one of which shall be selected
by the Seller and one of which shall be selected by the Purchaser or its
assignee. Each of the parties to the mediation shall submit the name of the
person it has selected to serve as a mediator to the opposing party within 10
days of the date of the Mediation Letter. If either party fails to submit the
name of its selected mediator within 10 days of the date of the Mediation
Letter, the other party shall have the right to select the second mediator in
addition to its own mediator (provided that such party has submitted the name of
its selected mediator within 10 days of the date of the Mediation Letter). The
two mediators selected by the party(ies) shall appoint a third mediator within
20 days of the date of the Mediation Letter or such longer time period as agreed
to by the parties to the mediation. Any mediator(s) so designated must be
acceptable to both the Seller and the Purchaser or its assignee.] Any mediators
appointed or selected pursuant to the provisions of this paragraph must be
experienced professionals in the CMBS industry.
Any mediation related to a particular Dispute and commenced in
accordance with the preceding paragraph must be completed within 90 days of the
date of the Mediation Letter (or a longer period, if the parties to the
mediation agreed to extend the mediation). Any mediation referred to in this
Section 5(i) shall be conducted in the manner specified by the mediator(s) and
agreed upon by the Seller and the Purchaser or its assignee and any such
mediation shall be conducted in New York City to the exclusion of all other
locations (unless otherwise agreed to by the parties to the mediation). During
the
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mediation process, the parties to the mediation shall discuss their
differences voluntarily and in good faith and attempt, with the assistance of
the mediator(s) as a facilitator of the negotiations, to reach an amicable
resolution of the Dispute. The mediation will be treated as a settlement
discussion and therefore will be confidential. No mediator selected in
accordance with this Section 5(i) may testify for either party in any later
proceeding relating to the Dispute. No recording or transcript shall be made of
the mediation proceedings. The fees and expenses of all mediator(s) shall be
shared equally by the parties to the mediation; provided, that the party to the
mediation that is acting on behalf of the Trust in accordance with the
provisions of this Section 5(i) shall be entitled to reimbursement or
indemnification by the Trust Fund for such fees and expenses if and to the
extent permitted under the Pooling and Servicing Agreement.
Notwithstanding anything to the contrary herein, no party shall be
required to agree to a Dispute resolution pursuant to mediation and no decision
or resolution of a mediator or mediators shall be binding on any party unless
such decision or resolution is expressly agreed to by such party. In the event
the parties involved in the Dispute have not agreed to a Dispute resolution
pursuant to mediation at the termination of the mediation, then that Dispute
will be settled by arbitration in accordance with the succeeding paragraphs of
this Section 5(i).
If a Dispute has not been resolved within 90 days of the date of the
Mediation Letter (or such shorter or longer period as is expressly agreed to by
the parties to the mediation), the mediation shall terminate and the Dispute
will be settled by arbitration. Following the date of termination of mediation,
which shall be the date occurring 90 days after the date of the Mediation Letter
unless otherwise expressly agreed to by the parties to the mediation,
arbitration may be commenced by any party to this Agreement involved in the
Dispute sending a written notice to another party to this Agreement involved in
the Dispute that they wish the arbitration process to begin with respect to the
Dispute between the sender and the recipient of such written notice. The date
any such party receives written notice in accordance with this Section 5(i) from
another party that such party wishes to commence arbitration shall be referred
to as the "Arbitration Commencement Date". Any arbitration hereunder shall be
conducted in accordance with the provisions of this Agreement and the American
Arbitration Association Rules for Large Complex Commercial Disputes ("AAA
Rules"), but shall not be conducted by the American Arbitration Association
("AAA"). Discovery will be permitted in connection with the arbitration in
accordance with the AAA Rules. In the event of a conflict, the provisions of
this Agreement will control. Such arbitration shall be conducted before a panel
of three arbitrators, regardless of the size of the Dispute. The arbitration
panel shall consist of one person selected by the Seller and one person selected
by the Purchaser or its assignee. Each such party shall submit the name of the
person it has selected to serve as an arbitrator to the other party within 30
days of the Arbitration Commencement Date (or such longer period as is expressly
agreed to by the parties to the arbitration). If either such party fails to
submit the name of its selected arbitrator within 30 days of the Arbitration
Commencement Date, then the other such party shall have the right to select the
second arbitrator in addition to its own arbitrator (provided that such party
has submitted the name of its selected arbitrator within 30 days of the
Arbitration Commencement Date). The two arbitrators designated in accordance
with the two preceding sentences shall appoint a third arbitrator within 45 days
of the Arbitration Commencement Date (or such longer period as is expressly
agreed to by the parties to the arbitration). All arbitrators appointed or
selected pursuant to the provisions of this paragraph must be experienced
professionals in the CMBS industry. The third arbitrator shall be an Independent
person who has not previously been employed by either party and does not have a
direct or indirect interest in either party or the subject matter of the
arbitration. The two (2) arbitrators appointed by the parties to
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the arbitration are not required to be neutral and it shall not be grounds for
removal of either of such arbitrators or for vacating an arbitration award that
either of such arbitrators has past or present relationships with the party that
appointed such arbitrator. No potential arbitrator may serve on the panel unless
he or she has agreed in writing to abide and be bound by the terms and
provisions of this Agreement and the AAA Rules and to keep confidential the
terms of any arbitration proceeding related to this Agreement and the terms of
any discussion, negotiation, decision, agreement or resolution in connection
therewith.
Any issue concerning the extent to which any Dispute is subject to
arbitration, or concerning the applicability, interpretation, or enforceability
of these procedures, including any contention that all or part of these
procedures are invalid or unenforceable, shall be resolved by the arbitrators.
In no event, notwithstanding that any provision of this Agreement is held to be
invalid or unenforceable, shall the arbitrators have the power to make an award
or impose a remedy that could not be made or imposed by a court deciding the
matter in the same jurisdiction. In no event shall the arbitrators have the
power to make an award or impose a remedy that is not contemplated by, or
conflicts with the terms and provisions of, this Agreement or the Pooling and
Servicing Agreement (other than any term or provision of this Agreement or the
Pooling and Servicing Agreement that is held to be invalid or unenforceable).
Without limiting the foregoing, the arbitrators shall have no authority to award
treble, consequential or punitive damages of any type under any circumstances,
whether or not such damages may be available under the AAA Rules or any other
act or law. Subject to the provisions of this Agreement, the result of the
arbitration will be binding on the parties involved in the Dispute, and judgment
on the arbitrators' award may be entered, subject to the provisions of Section
15 of this Agreement, in any court of competent jurisdiction.
All mediations and arbitrations shall be conducted in New York City to
the exclusion of all other locations (unless otherwise expressly agreed to by
the parties to the subject mediation or arbitration, as applicable). The party
to an arbitration that is acting on behalf of the Trust in accordance with the
provisions of this Section 5(i) shall be entitled to reimbursement or
indemnification by the Trust Fund for the fees and expenses incurred in
connection therewith if and to the extent permitted under the Pooling and
Servicing Agreement.
The parties to this Agreement hereby agree to waive any right to trial
by jury fully to the extent that any such right shall now or hereafter exist
with regard to the rights and remedies contained in this Section 5; provided,
that if (i) any party to an arbitration governed by this Section 5(i) fails to
abide by the rules or deadlines for that arbitration (as such deadlines may be
extended by express agreement of the parties to that arbitration), or (ii) the
applicable appointed arbitrators determine that the subject Dispute cannot be
resolved through arbitration either because the AAA Rules are inapplicable to
the Dispute and/or the Federal Arbitration Act is inapplicable to the Dispute or
for any other reason, then the other party (in the case of clause (i)) or any
party (in the case of clause (ii)) to this Agreement may in its sole option,
file a complaint to resolve the Dispute through a legal proceeding and in
accordance with the provision contained in Section 15 hereof.
If any of the provisions of this Section 5(i) are determined by a
court of law to be invalid or unenforceable, the remaining provisions shall
remain in effect and be binding on the parties involved in the Dispute to the
fullest extent permitted by law.
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SECTION 6. Repurchase of Early Defeasance Trust Mortgage Loans.
If the Purchaser or the Master Servicer notifies the Seller that the
Mortgagor under any of the Mortgage Loans that are Early Defeasance Trust
Mortgage Loans (i) intends to defease such Early Defeasance Trust Mortgage Loan
in whole on or before the second anniversary of the Closing Date and the amount
tendered by such Mortgagor to defease such Early Defeasance Trust Mortgage Loan
(in accordance with the related loan documents) is less than the Purchase Price
that would be applicable in the event of a repurchase of such Mortgage Loan
pursuant to or as otherwise contemplated by Section 5(a), or (ii) intends to
partially defease such Early Defeasance Trust Mortgage Loan on or prior to the
second anniversary of the Closing Date, or (iii) intends to defease such Early
Defeasance Trust Mortgage Loan in whole on or before the second anniversary of
the Closing Date and such Mortgagor is to tender Defeasance Collateral or such
other collateral as is permitted in connection with a defeasance under the
related loan documents that does not constitute a cash amount equal to or
greater than the Purchase Price set forth in clause (i) above in this paragraph,
then the Seller shall promptly repurchase such Mortgage Loan at a price equal to
(A) the related Purchase Price and (B) the amount, if any, by which the proceeds
from any cash defeasance deposit exceeds the related Purchase Price, in
accordance with the directions of the Master Servicer on a whole loan, servicing
released basis.
Upon the repurchase of a Mortgage Loan that is an Early Defeasance
Trust Mortgage Loan pursuant to Section 5 hereof and/or this Section 6, the
Purchaser shall effect a "qualified liquidation" of the related Loan REMIC in
accordance with the REMIC Provisions. The Seller hereby agrees to pay all
reasonable costs and expenses, including the costs of any opinions of counsel
under the Pooling and Servicing Agreement, in connection with any such
"qualified liquidation" of the related Loan REMIC in accordance with the REMIC
Provisions.
SECTION 7. Closing.
The closing of the sale of the Mortgage Loans (the "Closing") shall be
held at the offices of Sidley Austin LLP, 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000 at 10:00 a.m., New York City time, on the Closing Date.
The Closing shall be subject to each of the following conditions:
(a) All of the representations and warranties of the Seller set forth
in or made pursuant to Sections 3(a) and 3(b) of this Agreement, and all of the
representations and warranties of the Purchaser set forth in Section 4 of this
Agreement, shall be true and correct in all material respects as of the Closing
Date;
(b) Insofar as it affects the obligations of the Seller hereunder, the
Pooling and Servicing Agreement shall be in a form mutually acceptable to the
Purchaser and the Seller;
(c) All documents specified in Section 8 of this Agreement (the
"Closing Documents"), in such forms as are reasonably acceptable to the
Purchaser, shall be duly executed and delivered by all signatories as required
pursuant to the respective terms thereof;
(d) The Seller shall have delivered and released to the Trustee (or a
Custodian on its behalf), the Master Servicer and the Special Servicer all
documents and funds required to be delivered to the Trustee, the Master Servicer
and the Special Servicer, respectively, pursuant to Section 2 of this Agreement;
-17-
(e) All other terms and conditions of this Agreement required to be
complied with on or before the Closing Date shall have been complied with in all
material respects, and the Seller shall have the ability to comply with all
terms and conditions and perform all duties and obligations required to be
complied with or performed after the Closing Date;
(f) The Seller shall have paid all fees and expenses payable by it to
the Purchaser or otherwise pursuant to this Agreement; and
(g) Neither the Underwriting Agreement nor the Certificate Purchase
Agreement shall have been terminated in accordance with its terms.
All parties hereto agree to use their best efforts to perform their
respective obligations hereunder in a manner that will enable the Purchaser to
purchase the Mortgage Loans on the Closing Date.
SECTION 8. Closing Documents.
The Closing Documents shall consist of the following:
(a) This Agreement duly executed by the Purchaser and the Seller;
(b) The Pooling and Servicing Agreement duly executed by the parties
thereto;
(c) The Indemnification Agreement duly executed by the parties
thereto;
(d) Certificate of the Seller, executed by a duly authorized officer
of the Seller and dated the Closing Date, and upon which the initial Purchaser,
the Underwriters and the Placement Agents may rely, to the effect that: (i) the
representations and warranties of the Seller in this Agreement and in the
Indemnification Agreement are true and correct in all material respects at and
as of the Closing Date with the same effect as if made on such date; and (ii)
the Seller has, in all material respects, complied with all the agreements and
satisfied all the conditions on its part that are required under this Agreement
to be performed or satisfied at or prior to the Closing Date;
(e) An Officer's Certificate from an officer of the Seller, in his or
her individual capacity, dated the Closing Date, and upon which the initial
Purchaser, the Underwriters and the Placement Agents may rely, to the effect
that each individual who, as an officer or representative of the Seller signed
this Agreement, the Indemnification Agreement or any other document or
certificate delivered on or before the Closing Date in connection with the
transactions contemplated herein or in the Indemnification Agreement, was at the
respective times of such signing and delivery, and is as of the Closing Date,
duly elected or appointed, qualified and acting as such officer or
representative, and the signatures of such persons appearing on such documents
and certificates are their genuine signatures;
(f) As certified by an officer of the Seller, true and correct copies
of (i) the resolutions of the board of directors authorizing the Seller's
entering into the transactions contemplated by this Agreement and the
Indemnification Agreement, (ii) the organizational documents of the Seller, and
(iii) a certificate of good standing of the Seller, issued by the Secretary of
State of the State of Delaware not earlier than 10 days prior to the Closing
Date;
-18-
(g) A favorable opinion of Cadwalader, Xxxxxxxxxx & Xxxx ("CWT"),
special counsel to the Seller, substantially in the form attached hereto as
Exhibit C-1, dated the Closing Date and addressed to the initial Purchaser, the
Underwriters, the Placement Agents, the Rating Agencies and, upon request, the
other parties to the Pooling and Servicing Agreement, together with such other
opinions of CWT as may be required by the Rating Agencies in connection with the
transactions contemplated hereby;
(h) An Officer's Certificate from an officer of the Seller, in his or
her individual capacity, delivered in connection with the opinion of CWT to be
delivered pursuant to Section 8(g) hereof, in form and substance satisfactory to
the addressees of such opinion and upon which such addressees may rely;
(i) In connection with the initial issuance of the Seller's Residual
Interest Certificates, a Transfer Affidavit and Agreement in the form
contemplated by the Pooling and Servicing Agreement from Seller and from the
transferee of the Seller;
(j) In the event any of the Certificates are mortgage related
securities within the meaning of the Secondary Mortgage Market Enhancement Act
of 1984, as amended, a Certificate of the Seller regarding origination of the
Mortgage Loans by specified originators as set forth in Section 3(a)(41) of the
Securities Exchange Act of 1934, as amended; and
(k) Such further certificates, opinions and documents as the Purchaser
may reasonably request.
SECTION 9. Costs.
An amount equal to 17.78629% of all reasonable out-of-pocket costs and
expenses incurred by the Seller, the initial Purchaser, the Underwriters, the
Placement Agents and the seller of the Other Loans to the Purchaser in
connection with the securitization of the Securitized Loans and the other
transactions contemplated by this Agreement, the Underwriting Agreement and the
Certificate Purchase Agreement shall be payable by the Seller.
SECTION 10. Grant of a Security Interest.
The parties hereto agree that it is their express intent that the
conveyance of the Mortgage Loans by the Seller to the Purchaser as provided in
Section 2 hereof be, and be construed as, a sale of the Mortgage Loans by the
Seller to the Purchaser and not as a pledge of the Mortgage Loans by the Seller
to the Purchaser to secure a debt or other obligation of the Seller. However,
if, notwithstanding the aforementioned intent of the parties, the Mortgage Loans
are held to be property of the Seller, then it is the express intent of the
parties that: (i) such conveyance shall be deemed to be a pledge of the Mortgage
Loans by the Seller to the Purchaser to secure a debt or other obligation of the
Seller; (ii) this Agreement shall be deemed to be a security agreement within
the meaning of Articles 8 and 9 of the applicable Uniform Commercial Code; (iii)
the conveyance provided for in Section 2 hereof shall be deemed to be a grant by
the Seller to the Purchaser of a security interest in all of the Seller's right,
title and interest in and to the Mortgage Loans, and all amounts payable to the
holder of the Mortgage Loans in accordance with the terms thereof, and all
proceeds of the conversion, voluntary or involuntary, of the foregoing into
cash, instruments, securities or other property; (iv) the assignment to the
Trustee of the interest of the Purchaser in and to the Mortgage Loans shall be
deemed to be an assignment of any
-19-
security interest created hereunder; (v) the possession by the Trustee or any of
its agents, including, without limitation, the Custodian, of the Mortgage Notes
for the Mortgage Loans, and such other items of property as constitute
instruments, money, negotiable documents or chattel paper shall be deemed to be
"possession by the secured party" for purposes of perfecting the security
interest pursuant to Section 9-313 of the applicable Uniform Commercial Code;
and (vi) notifications to persons (other than the Trustee) holding such
property, and acknowledgments, receipts or confirmations from such persons
holding such property, shall be deemed notifications to, or acknowledgments,
receipts or confirmations from, financial intermediaries, bailees or agents (as
applicable) of the secured party for the purpose of perfecting such security
interest under applicable law. The Seller and the Purchaser shall, to the extent
consistent with this Agreement, take such actions as may be necessary to ensure
that, if this Agreement were deemed to create a security interest in the
Mortgage Loans, such security interest would be deemed to be a perfected
security interest of first priority under applicable law and will be maintained
as such throughout the term of this Agreement and the Pooling and Servicing
Agreement; and, in connection with the foregoing, the Seller authorizes the
Purchaser to file any and all appropriate Uniform Commercial Code financing
statements.
SECTION 11. Notices.
All notices, copies, requests, consents, demands and other
communications required hereunder shall be in writing and telecopied or
delivered to the intended recipient at the "Address for Notices" specified
beneath its name on the signature pages hereof or, as to any party, at such
other address as shall be designated by such party in a notice hereunder to the
other parties. Except as otherwise provided in this Agreement, all such
communications shall be deemed to have been duly given when transmitted by
telecopier or personally delivered or, in the case of a mailed notice, upon
receipt, in each case given or addressed as aforesaid.
SECTION 12. Representations, Warranties and Agreements to Survive
Delivery.
All representations, warranties and agreements contained in this
Agreement, incorporated herein by reference or contained in the certificates of
officers of the Seller submitted pursuant hereto, shall remain operative and in
full force and effect and shall survive delivery of the Mortgage Loans by the
Seller to the Purchaser (and by the initial Purchaser to the Trustee).
SECTION 13. 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.
-20-
SECTION 14. Counterparts.
This Agreement may be executed in any number of counterparts, each of
which shall be an original, but which together shall constitute one and the same
agreement.
SECTION 15. GOVERNING LAW; CONSENT TO JURISDICTION.
THIS AGREEMENT WILL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK, APPLICABLE TO AGREEMENTS NEGOTIATED, MADE AND
TO BE PERFORMED ENTIRELY IN SAID STATE. TO THE FULLEST EXTENT PERMITTED UNDER
APPLICABLE LAW AND SUBJECT TO SECTION 5(i) HEREOF, THE SELLER AND THE PURCHASER
EACH HEREBY IRREVOCABLY (I) SUBMITS TO THE JURISDICTION OF ANY NEW YORK STATE
AND FEDERAL COURTS SITTING IN NEW YORK CITY, TO THE EXCLUSION OF ALL OTHER
COURTS, WITH RESPECT TO MATTERS ARISING OUT OF OR RELATING TO THIS AGREEMENT
OTHER THAN MATTERS TO BE SETTLED BY MEDIATION OR ARBITRATION IN ACCORDANCE WITH
SECTION 5(i) HEREOF; (II) AGREES THAT ALL CLAIMS WITH RESPECT TO SUCH ACTION OR
PROCEEDING SHALL BE HEARD AND DETERMINED IN SUCH NEW YORK STATE OR FEDERAL
COURTS, TO THE EXCLUSION OF ALL OTHER COURTS; (III) WAIVES, TO THE FULLEST
POSSIBLE EXTENT, THE DEFENSE OF AN INCONVENIENT FORUM IN CONNECTION WITH SUCH
ACTION OR PROCEEDING COMMENCED IN SUCH NEW YORK STATE OR FEDERAL COURTS; AND
(IV) AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE
CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR
IN ANY OTHER MANNER PROVIDED BY LAW; PROVIDED, THAT IN THE EVENT SECTION 5(i)
HEREOF IS INAPPLICABLE AND BOTH A NEW YORK STATE AND A FEDERAL COURT SITTING IN
NEW YORK IN WHICH AN ACTION OR PROCEEDING HAS BEEN DULY AND PROPERLY COMMENCED
BY ANY PARTY TO THIS AGREEMENT REGARDING A MATTER ARISING OUT OF OR RELATING TO
THIS AGREEMENT HAS REFUSED TO ACCEPT JURISDICTION OVER OR OTHERWISE HAS NOT
ACCEPTED SUCH ACTION OR PROCEEDING WITHIN, IN THE CASE OF EACH SUCH COURT, 60
DAYS OF THE COMMENCEMENT OR FILING THEREOF, THEN THE WORDS "TO THE EXCLUSION OF
ALL OTHER COURTS" IN CLAUSE (I) AND CLAUSE (II) OF THIS SENTENCE SHALL NOT APPLY
WITH REGARD TO SUCH ACTION OR PROCEEDING AND THE REFERENCE TO "SHALL" IN CLAUSE
(II) OF THIS SECTION SHALL BE DEEMED TO BE "MAY".
SECTION 16. Further Assurances.
The Seller and the Purchaser each agrees to execute and deliver such
instruments and take such further actions as any other such party may, from time
to time, reasonably request in order to effectuate the purposes and to carry out
the terms of this Agreement.
SECTION 17. Successors and Assigns.
The rights and obligations of the Seller under this Agreement shall
not be assigned by the Seller without the prior written consent of the
Purchaser, except that any person into which the Seller may be merged or
consolidated, or any corporation resulting from any merger, conversion or
consolidation to which the Seller is a party, or any person succeeding to all or
substantially all of the
-21-
business of the Seller, shall be the successor to the Seller hereunder. The
Purchaser has the right to assign its interest under this Agreement, in whole or
in part, as may be required to effect the purposes of the Pooling and Servicing
Agreement, and the assignee shall, to the extent of such assignment, succeed to
the rights and obligations hereunder of the Purchaser. Subject to the foregoing,
this Agreement shall bind and inure to the benefit of and be enforceable by the
Seller, the Purchaser, and their respective successors and permitted assigns.
SECTION 18. Amendments.
No term or provision of this Agreement may be waived or modified
unless such waiver or modification is in writing and signed by a duly authorized
officer of the party against whom such waiver or modification is sought to be
enforced. The Seller's obligations hereunder shall in no way be expanded,
changed or otherwise affected by any amendment of or modification to the Pooling
and Servicing Agreement, unless the Seller has consented to such amendment or
modification in writing.
-22-
IN WITNESS WHEREOF, the Seller and the Purchaser have caused their
names to be signed hereto by their respective duly authorized officers as of the
date first above written.
SELLER
UBS REAL ESTATE INVESTMENTS INC.
By: /s/ Xxxxxx X. Xxxxxxxxx
--------------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Executive Director
By: /s/ Xxxx Xxxxx
--------------------------------------
Name: Xxxx Xxxxx
Title: Executive Director
Address for Notices:
1285 Avenue of the Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxxxxxxx
Telecopier No.: (000) 000-0000
with a copy to:
1285 Avenue of the Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxx
Telecopier No.: (000) 000-0000
-23-
PURCHASER
STRUCTURED ASSET SECURITIES CORPORATION II
By: /s/ Xxxxx Xxxxxxxx
--------------------------------------
Name: Xxxxx Xxxxxxxx
Title: Senior Vice President
Address for Notices:
Structured Asset Securities Corporation II
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxxxx
Telecopier No.: (000) 000-0000
-24-
EXHIBIT A
MORTGAGE LOAN SCHEDULE
MORTGAGE
LOAN
NUMBER PROPERTY NAME ADDRESS CITY
---------------------------------------------------------------------------------------------------------------------------------
10 Green Valley Portfolio Various Various
13 000 Xxxxxxx Xxxxxx 000 Xxxxxxx Xxxxxx Xxx Xxxx
23 La Pacifica Apartments 00000 Xxxxxxx Xxxxxx Xxxxxx Valley
24 0000 Xxxxxx Xxxxxx 0000 Xxxxxx Xxxxxx Xxxxxx Xxxxxx
25 Royal Xxxxxxx Xxxx 00000 Xxxxx Xxxxxx Xxxxxxxxx Xxx Xxxxxxx
26 Holiday Inn Express Hotel & Suites King of Prussia 000 Xxxxx Xxxxx Xxxx King of Prussia
27 Wilmington Portfolio Various Wilmington
31 NBSC Building 0000 Xxxx Xxxxxx Xxxxxxxx
32 Countryview MHC 0000 Xxxxxxxx Xxxx Xxxxxxxx
36 Glenlake Professional Offices 0000 Xxxx Xxxx Xxxxxx Glenview
40 0000 Xxxxxxxxxxx Xxxx 2802 Bloomington Road Champaign
44 Mountain View Villa Apartments 000 Xxxx Xxxxxx Xxxxxx Xxxxxxxxxx
48 00 Xxxxx Xxxxx 00 Xxxxx Xxxxx Xxxxxxxxxxx
49 Dr.'s Medical Plaza 10510 and 00000 Xxxxxx Xxxxxxxxx Xxxxxxx Hills
52 Clarksburg Highlands 00000 Xxxxxxxxxx Xxxx Xxxxxxxxxx
58 0000 Xxxxx Xxxxx 0000 Xxxxx Xxxxx Flowery Branch
62 Walgreens - Roselle 000 Xxxx 0xx Xxxxxx Roselle
63 Rite Aid - Church Street 140 Church Street New York
67 SLO Self Storage 000 Xxxxxxxx Xxxx Xxx Xxxx Xxxxxx
00 CVS - Xxxxxxx 00 Xxxx Xxxxxx Xxxxxxx
00 Xxxxxxxx Xxxxxxx 000 Xxxxx 00 Xxxxxxxx
70 000 Xxxxxxxx Xxxxx 000 Xxxxxxxx Xxxxx Xxxxxxxxxxx
00 Xxxxxxx Self Storage 00000 Xxxx XxXxxxxx Xxxx Goodyear
72 1543 Xxxxxx 0000 Xxxxxx Xxxxx Xxx Xxxxxxx
76 000 Xxxxxxxx Xxxx 000 Xxxxxxxx Xxxx Xxxxx Mountian
77 Walgreens - Saraland 00 Xxxxxxx Xxxxx Xxxx Xxxxxxxx
79 Nukoa Plaza 3230 Xxxxx Xxxxxxxx Xxxxxxxxx Xxxxxx
00 Xxxxxxxxx - Xxxxx Xxxx 0000 Xxxxxxxxxx Xxxx Xxxxx Xxxx
00 Xxxxxxxxx - Xxxxxxx 0000 Xxxx Xxxx Xxxxxxx
00 Xxxxxxxxx Xxxxx 0000 Xxxxxxxxx Boulevard Xxxxxx
88 Holiday Inn Express Xxxxxx-Xxxxxxx 0 Xxxxxxxx Xxxx Frazer
89 Walgreens - Decatur 0000 Xxxxx Xxxxx Xxxxxx Decatur
92 CVS - Xxxxxxxxxxx 000 Xxxx Xxxxxx Xxxxxxxxxxx
00 Affordable Self Storage 0000 Xxxxxxx Xxxx Xxxxxxxxxxxxxx
94 Crystal Valley Mobile Home Park 0000 Xxxxxxx Xxxxx Xxxxxxxx
99 Toys R Us Center 5609 Xxxxxx Avenue Fort Xxxxx
100 Walgreens - Long Beach 000 Xxxx Xxxxxxxx Xxxxxx Xxxx Xxxxx
101 1541 Wilshire 0000 Xxxxxxxx Xxxxxxxxx Xxx Xxxxxxx
000 Xxxxxxx Xxxxxx 0000 Xxxxx XX Xxxxxxx 00 Xxxxxxx
000 Xxxxxxxxx - Bossier 0000 Xxxxxxx Xxxxx Bossier
108 Rossford Hills Apartments 71, 81 and 00 Xxxxxxx Xxxxxx Xxxxxxxx
116 Franklin & Halsted Portfolio Various Various
000 Xxxxxxxx Xxxxxxx 000 Xxxxx Xxxxxxxx Xxxxxx Tifton
122 Ronkonkoma Blue Island & Central Portfolio Various Various
125 Wichita & Anaheim Portfolio Various Various
130 Walgreens - Jacksonville 00000 Xxxxxxxx Xxxxxxxxx Jacksonville
132 35 & Cicero Portfolio Various Various
133 Georgetown Self Storage 0000 Xxxx Xxxxx Xxxxxxxxxx
134 Bellflower Apartments 0000 Xxxx Xxxx Xxxxxx Xxxxxxx
000 Xxxxx Xxxxx Apartments 00 Xxxxxxx Xxxxxx Xxxxxxxx
000 Tift Crossing & Tift Pavilion 0000 Xxxxx Xxxxxx Xxxxxx, 0000 Xxxxx Xxxxxx Xxxxxx Tifton
142 Family Dollar - 000xx Xxxxxx 000 Xxxx 000xx Xxxxxx Xxxxxxx
143 IHOP - Nashville 0000 Xxxxxxxxxxx Xxxx Nashville
144 Interstate & Oakton Portfolio Various Various
145 37th and Mt. Xxxxxx Apartments 0000 X. 00xx Xxxxxx Spokane
MORTGAGE REMAINING REMAINING INTEREST
LOAN CUT-OFF MONTHLY MORTGAGE TERM TO MATURITY AMORTIZATION ACCRUAL ADMINISTRATIVE
NUMBER STATE ZIP CODE DATE BALANCE P&I PAYMENT RATE MATURITY DATE TERM BASIS COST RATE
--------------------------------------------------------------------------------------------------------------------------------
10 Various Various 34,150,000.00 226,439.34 6.975000 120 6/11/2016 0 Xxx/000 0.00000
00 XX 00000 26,766,000.00 129,017.39 5.705000 115 1/11/2016 0 Xxx/000 0.00000
00 XX 00000 15,000,000.00 80,350.69 6.340000 58 4/11/2011 0 Act/360 0.02100
00 XX 00000 14,800,000.00 87,500.30 5.870000 117 3/11/2016 000 Xxx/000 0.00000
00 XX 00000 14,500,000.00 77,880.61 6.357000 120 6/11/2016 0 Xxx/000 0.00000
00 XX 00000 12,950,000.00 86,068.70 6.330000 120 6/11/2016 300 Act/360 0.02100
00 XX 00000 12,730,000.00 84,606.53 6.330000 120 6/11/2016 000 Xxx/000 0.00000
00 XX 00000 12,000,000.00 73,340.61 6.180000 118 4/11/2016 360 Act/360 0.02100
32 IN 46131 11,928,000.00 68,928.11 5.660000 78 12/11/2012 000 Xxx/000 0.00000
00 XX 00000 10,593,000.00 65,291.83 6.260000 118 4/11/2016 000 Xxx/000 0.00000
00 XX 00000 8,854,000.00 42,715.43 5.710000 117 3/11/2016 0 Xxx/000 0.00000
00 XX 00000 8,000,000.00 39,812.04 5.890000 118 4/11/2016 0 Act/360 0.02100
00 XX 00000 7,522,000.00 36,289.30 5.710000 117 3/11/2016 0 Act/360 0.02100
00 XX 00000 7,200,000.00 38,610.92 6.347000 121 7/11/2016 0 Act/360 0.02100
00 XX 00000 7,000,000.00 41,179.10 5.860000 119 5/11/2016 0 Act/360 0.02100
00 XX 00000 6,425,000.00 30,996.91 5.710000 117 3/11/2016 0 Xxx/000 0.00000
00 XX 00000 5,742,000.00 28,381.03 5.850000 118 4/11/2016 0 Xxx/000 0.00000
00 XX 00000 5,692,990.35 56,885.83 8.450000 158 8/5/2019 000 Xxx/000 0.00000
00 XX 00000 5,600,000.00 35,101.70 6.420000 120 6/11/2016 000 Xxx/000 0.00000
00 XX 00000 5,596,000.00 26,240.97 5.550000 118 4/11/2016 0 Xxx/000 0.00000
00 XX 00000 5,440,000.00 35,055.69 6.695000 120 6/11/2016 0 Xxx/000 0.00000
00 XX 00000 5,202,000.00 25,096.64 5.710000 117 3/11/2016 0 Xxx/000 0.00000
00 XX 00000 5,200,000.00 31,193.98 7.100000 120 6/11/2016 0 Act/360 0.02100
00 XX 00000 5,200,000.00 27,929.60 6.357000 121 7/11/2016 0 Act/360 0.02100
00 XX 00000 5,095,000.00 24,580.43 5.710000 117 3/11/2016 0 Act/360 0.02100
77 AL 36571 5,079,000.00 23,945.37 5.580000 118 4/11/2016 0 Act/360 0.02100
00 XX 00000 5,000,000.00 30,688.37 6.220000 121 7/11/2016 000 Xxx/000 0.00000
00 XX 00000 4,926,000.00 23,099.18 5.550000 117 3/11/2016 0 Xxx/000 0.00000
00 XX 00000 4,425,000.00 21,497.61 5.750000 117 3/11/2016 0 Xxx/000 0.00000
00 XX 00000 4,292,359.50 26,141.16 6.130000 118 4/11/2016 000 Xxx/000 0.00000
00 XX 00000 4,070,000.00 27,050.16 6.330000 120 6/11/2016 000 Xxx/000 0.00000
00 XX 00000 4,003,000.00 20,191.52 5.970000 120 6/11/2016 0 Act/360 0.02100
00 XX 00000 3,966,000.00 18,597.51 5.550000 117 3/11/2016 0 Act/360 0.02100
00 XX 00000 3,950,000.00 23,479.47 5.920000 116 2/11/2016 000 Xxx/000 0.00000
00 XX 00000 3,866,340.85 24,914.50 6.680000 119 5/11/2016 000 Xxx/000 0.00000
00 XX 00000 3,665,185.56 23,948.38 6.120000 118 4/11/2016 298 Act/360 0.02100
000 XX 00000 3,662,000.00 18,038.32 5.830000 120 6/11/2016 0 Act/360 0.02100
000 XX 00000 3,600,000.00 19,335.88 6.357000 120 6/11/2016 0 Act/360 0.02100
000 XX 00000 3,593,310.31 21,422.07 5.930000 118 4/11/2016 358 Act/360 0.02100
000 XX 00000 3,421,000.00 17,602.71 6.090000 120 6/11/2016 0 Xxx/000 0.00000
000 XX 00000 3,300,000.00 19,955.22 6.080000 118 4/11/2016 360 Act/360 0.02100
116 Various Various 2,925,964.78 18,176.95 5.605000 119 5/11/2016 299 Act/360 0.02100
000 XX 00000 2,797,911.16 17,495.84 6.390000 119 5/11/2016 359 Act/360 0.02100
122 Various Various 2,684,298.06 16,675.65 5.605000 119 5/11/2016 299 Act/360 0.02100
125 Various Various 2,496,556.97 15,509.35 5.605000 119 5/11/2016 299 Act/360 0.02100
000 XX 00000 2,311,000.00 13,179.92 6.750000 119 5/11/2016 0 Act/360 0.02100
132 IL Various 2,275,861.34 14,138.32 5.605000 119 5/11/2016 000 Xxx/000 0.00000
000 XX 00000 2,200,000.00 13,674.82 6.340000 118 4/11/2016 000 Xxx/000 0.00000
000 XX 00000 2,194,160.69 13,218.41 6.020000 117 3/11/2016 000 Xxx/000 0.00000
000 XX 00000 1,900,000.00 11,464.86 6.060000 118 4/11/2016 360 Act/360 0.02100
000 XX 00000 1,898,602.14 11,934.42 6.440000 119 5/11/2016 359 Act/360 0.02100
000 XX 00000 1,410,614.53 8,993.40 5.860000 118 4/11/2016 000 Xxx/000 0.00000
000 XX 00000 1,362,000.00 8,875.56 6.120000 120 6/11/2016 300 Act/360 0.02100
144 IL Various 1,073,519.50 6,669.02 5.605000 119 5/11/2016 000 Xxx/000 0.00000
000 XX 00000 1,047,330.40 7,024.21 6.400000 118 4/11/2016 298 Act/360 0.02100
MORTGAGE PRIMARY MORTGAGE ARD ANTICIPATED
LOAN SERVICING LOAN MORTGAGE REPAYMENT ARD
NUMBER FEE GROUND LEASE? SELLER DEFEASANCE LOAN DATE SPREAD
-------------------------------------------------------------------------------------------------------------------------------
10 0.00 Fee Simple UBS Defeasance No N/A N/A
13 0.00 Leasehold UBS Defeasance No N/A N/A
23 0.00 Fee Simple UBS Defeasance No N/A N/A
24 0.00 Fee Simple UBS Yield Maintenance No N/A N/A
25 0.00 Fee Simple UBS Defeasance No N/A N/A
26 0.00 Fee Simple UBS Defeasance No N/A N/A
27 0.00 Fee Simple UBS Defeasance No N/A N/A
31 0.00 Fee Simple UBS Defeasance No N/A N/A
32 0.00 Fee Simple UBS Defeasance No N/A N/A
36 0.00 Fee Simple UBS Defeasance No N/A N/A
40 0.00 Fee Simple UBS Yield Maintenance, Defeasance or Yield Maintenance No N/A N/A
44 0.00 Fee Simple UBS Defeasance No N/A N/A
48 0.00 Fee Simple UBS Yield Maintenance, Defeasance or Yield Maintenance No N/A N/A
49 0.00 Fee Simple UBS Defeasance No N/A N/A
52 0.00 Fee Simple UBS Defeasance No N/A N/A
58 0.00 Fee Simple UBS Yield Maintenance, Defeasance or Yield Maintenance No N/A N/A
62 0.00 Fee Simple UBS Yield Maintenance, Defeasance or Yield Maintenance No N/A N/A
63 0.00 Fee Simple UBS Defeasance No N/A N/A
67 0.00 Fee Simple UBS Defeasance No N/A N/A
68 0.00 Fee Simple UBS Yield Maintenance, Defeasance or Yield Maintenance No N/A N/A
69 0.00 Fee Simple UBS Defeasance No N/A N/A
70 0.00 Fee Simple UBS Yield Maintenance, Defeasance or Yield Maintenance No N/A N/A
71 0.00 Fee Simple UBS Yield Maintenance No N/A N/A
72 0.00 Fee Simple UBS Defeasance No N/A N/A
76 0.00 Fee Simple UBS Yield Maintenance, Defeasance or Yield Maintenance No N/A N/A
77 0.00 Fee Simple UBS Yield Maintenance, Defeasance or Yield Maintenance No N/A N/A
79 0.00 Fee Simple UBS Defeasance No N/A N/A
80 0.00 Fee Simple UBS Yield Maintenance, Defeasance or Yield Maintenance No N/A N/A
83 0.00 Fee Simple UBS Yield Maintenance, Defeasance or Yield Maintenance No N/A N/A
86 0.00 Fee Simple UBS Defeasance No N/A N/A
88 0.00 Fee Simple UBS Defeasance No N/A N/A
89 0.00 Fee Simple UBS Yield Maintenance, Defeasance or Yield Maintenance No N/A N/A
92 0.00 Fee Simple UBS Yield Maintenance, Defeasance or Yield Maintenance No N/A N/A
93 0.00 Fee Simple UBS Yield Maintenance No N/A N/A
94 0.00 Fee Simple UBS Defeasance-Prepayment Penalty No N/A N/A
99 0.00 Fee Simple UBS Defeasance No N/A N/A
100 0.00 Fee Simple UBS Yield Maintenance, Defeasance or Yield Maintenance No N/A N/A
101 0.00 Fee Simple UBS Defeasance No N/A N/A
102 0.00 Fee Simple UBS Defeasance No N/A N/A
105 0.00 Fee Simple UBS Defeasance No N/A N/A
108 0.00 Fee Simple UBS Defeasance No N/A N/A
116 0.00 Fee Simple UBS Defeasance No N/A N/A
118 0.00 Fee Simple UBS Defeasance No N/A N/A
122 0.00 Fee Simple UBS Defeasance No N/A N/A
125 0.00 Fee Simple UBS Defeasance No N/A N/A
130 0.00 Fee Simple UBS Defeasance No N/A N/A
132 0.00 Fee Simple UBS Defeasance No N/A N/A
133 0.00 Fee Simple UBS Yield Maintenance No N/A N/A
134 0.00 Fee Simple UBS Defeasance No N/A N/A
136 0.00 Fee Simple UBS Defeasance No N/A N/A
137 0.00 Fee Simple UBS Defeasance No N/A N/A
142 0.00 Fee Simple UBS Defeasance No N/A N/A
143 0.00 Fee Simple UBS Defeasance No N/A N/A
144 0.00 Fee Simple UBS Defeasance No N/A N/A
145 0.00 Fee Simple UBS Defeasance No N/A N/A
MORTGAGE
MORTGAGE LOAN
LOAN CROSS SELLER
NUMBER COLLATERALIZED LOAN ID
----------------------------------
10 No UBS1
13 No UBS15
23 No 11221
24 No 11196
25 No UBS6
26 No 112862
27 No 1128645
31 No 11226
32 No 11061
36 No 11999
40 No 111491
44 No 11197
48 No 111492
49 No UBS10
52 No 11159
58 No 111494
62 No UBS11
63 No UBS34
67 No 11241
68 No 11075
69 No UBS12
70 No 111497
71 No 11225
72 No UBS13
76 No 111496
77 No 11160
79 No 11208
80 No 11076
83 No 11151
86 No 11211
88 No 112861
89 No UBS35
92 No 11074
93 No 11158
94 No 11177
99 No 11144
100 No UBS18
101 No UBS19
102 No 11166
105 No UBS36
108 No 11207
116 No 11267
118 Yes (UBS-L) 11045
122 No 11269
125 No 11270
130 No 11222
132 No 11264
133 No 11185
134 No 11184
136 No 11206
137 Yes (UBS-L) 11044
142 No 11130
143 No UBS28
144 No 11268
145 No 11198
EXHIBIT B
REPRESENTATIONS AND WARRANTIES
Except as set forth on the schedule of exceptions attached hereto as
Schedule I, the Seller hereby represents and warrants to the Purchaser, with
respect to each Mortgage Loan, as of the Closing Date or such other date
specified in the particular representation and warranty (the heading set forth
herein with respect to each representation and warranty being for the
convenience of reference only and in no way limiting, expanding or otherwise
affecting the scope or subject matter thereof), that:
(i) Mortgage Loan Schedule. The information pertaining to such
Mortgage Loan set forth in the Mortgage Loan Schedule was true and correct in
all material respects as of the Cut-off Date.
(ii) Legal Compliance. If such Mortgage Loan was originated by the
Seller or an Affiliate of the Seller, then, as of the date of its origination,
such Mortgage Loan complied in all material respects with, or was exempt from,
all requirements of federal, state or local law relating to the origination of
such Mortgage Loan; and, if such Mortgage Loan was not originated by the Seller
or an Affiliate of the Seller, then such mortgage loan is listed on Schedule
I-ii hereto and, to the Seller's actual knowledge, after having performed the
type of due diligence customarily performed in the origination of comparable
mortgage loans by the Seller, as of the date of its origination, such Mortgage
Loan complied in all material respects with, or was exempt from, all
requirements of federal, state or local law relating to the origination of such
Mortgage Loan.
(iii) Ownership of Mortgage Loan. The Seller owns such Mortgage Loan,
has good title thereto, has full right, power and authority to sell, assign and
transfer such Mortgage Loan and is transferring such Mortgage Loan free and
clear of any and all liens, pledges, charges or security interests of any nature
encumbering such Mortgage Loan, exclusive of the servicing rights pertaining
thereto; no provision of the Mortgage Note, Mortgage(s) or other loan documents
relating to such Mortgage Loan prohibits or restricts the Seller's right to
assign or transfer such Mortgage Loan to the Trustee (except in the case of a
Loan Combination, which may, pursuant to the related Co-Lender Agreement,
require notice to one or more rating agencies or another lender which, if
required, has already been provided); no governmental or regulatory approval or
consent is required for the sale of such Mortgage Loan by the Seller; and the
Seller has validly conveyed to the Trustee a legal and beneficial interest in
and to such Mortgage Loan free and clear of any lien, claim or encumbrance of
any nature.
(iv) No Holdback. The proceeds of such Mortgage Loan have been fully
disbursed (except in those cases where the full amount of such Mortgage Loan has
been disbursed but a portion thereof is being held in escrow or reserve accounts
to be released pending the satisfaction of certain conditions relating to
leasing, repairs or other matters with respect to the related Mortgaged
Property) and there is no requirement for future advances thereunder.
(v) Loan Document Status. Each of the related Mortgage Note,
Mortgage(s), Assignment(s) of Leases, if separate from the related Mortgage, and
other agreements executed in favor of the lender in connection therewith is the
legal, valid and binding obligation of the maker thereof (subject to the
non-recourse provisions therein and any state anti-deficiency legislation),
enforceable in accordance with its terms, except that (A) such enforcement may
be limited by (1) bankruptcy, insolvency, receivership, reorganization,
liquidation, voidable preference, fraudulent conveyance and
1
transfer, moratorium and/or other similar laws affecting the enforcement of
creditors' rights generally, and (2) general principles of equity (regardless of
whether such enforcement is considered in a proceeding in equity or at law), and
(B) certain provisions in the subject agreement or instrument may be further
limited or rendered unenforceable by applicable law, but subject to the
limitations set forth in the foregoing clause (A), such limitations will not
render that subject agreement or instrument invalid as a whole or substantially
interfere with the mortgagee's realization of the principal benefits and/or
security provided by the subject agreement or instrument. Such Mortgage Loan is
non-recourse to the Mortgagor or any other Person except to the extent provided
in certain nonrecourse carveouts and/or in any applicable guarantees. A natural
person as individual guarantor has agreed, in effect, to be liable for all
liabilities, costs, losses, damages or expenses suffered or incurred by the
mortgagee under such Mortgage Loan by reason of or in connection with and to the
extent of (A) any material intentional fraud or material intentional
misrepresentation by the related mortgagor; (B) any breach on the part of the
related mortgagor of any environmental representations warranties and covenants
contained in the related Mortgage Loan documents; (C) misapplication or
misappropriation of rents (received after an event of default), insurance
proceeds or condemnation awards; and (D) the filing of a voluntary bankruptcy or
insolvency proceeding by the related mortgagor; provided that, instead of any
breach described in clause (B) of this paragraph, such entity (or individual)
may instead be liable for liabilities, costs, losses, damages, expenses and
claims resulting from a breach of the obligations and indemnities of the related
mortgagor under the related Mortgage Loan documents relating to hazardous or
toxic substances, radon or compliance with environmental laws.
(vi) No Right of Rescission. Subject to the limitations and exceptions
as to enforceability set forth in paragraph (v) above, there is no valid offset,
defense, counterclaim or right of rescission, abatement of amounts due under the
Mortgage Note or diminution of amounts due under the Mortgage Note with respect
to any of the related Mortgage Note, Mortgage(s) or other agreements executed in
connection with such Mortgage Loan and, as of the Closing Date, to the actual
knowledge of the Seller, no such claim has been asserted.
(vii) Assignments. The assignment of the related Mortgage(s) and
Assignment(s) of Leases to the Trustee (or, in the case of the Outside Serviced
Trust Mortgage Loan, to the related Outside Trustee) constitutes the legal,
valid, binding and, subject to the limitations and exceptions as to
enforceability set forth in paragraph (v) above, enforceable assignment of such
documents (provided that the unenforceability of any such assignment based on
bankruptcy, insolvency, receivership, reorganization, liquidation, moratorium
and/or other similar laws affecting the enforcement of creditors' rights
generally or based on general principles of equity (regardless of whether such
enforcement is considered in a proceeding in equity or at law) shall be a breach
of this representation and warranty only upon the declaration by a court with
jurisdiction in the matter that such assignment is to be unenforceable on such
basis).
(viii) First Lien. Each related Mortgage is a valid and, subject to
the limitations and exceptions in paragraph (v) above, enforceable first lien on
the related Mortgaged Property including all improvements thereon (other than
any tenant owned improvements) and appurtenances and rights related thereto,
which Mortgaged Property is free and clear of all encumbrances and liens having
priority over or on a parity with the first lien of such Mortgage, except for
the following (collectively, the "Permitted Encumbrances"): (A) the lien for
real estate taxes, water charges, sewer rents and assessments not yet due and
payable; (B) covenants, conditions and restrictions, rights of way, easements
and other matters that are of public record or that are omitted as exceptions in
the related
2
lender's title insurance policy (or, if not yet issued, omitted as exceptions in
a fully binding pro forma title policy or title policy commitment); (C) the
rights of tenants (as tenants only) under leases (including subleases)
pertaining to the related Mortgaged Property; (D) condominium declarations of
record and identified in the related lender's title insurance policy (or, if not
yet issued, identified in a pro forma title policy or title policy commitment);
and (E) if such Mortgage Loan constitutes a Cross-Collateralized Mortgage Loan,
the lien of the Mortgage for another Mortgage Loan contained in the same
Cross-Collateralized Group; provided that, in the case of a Trust Mortgage Loan
that is part of a Loan Combination, such Mortgage also secures the other
mortgage loan(s) in such Loan Combination. With respect to such Mortgage Loan,
such Permitted Encumbrances do not, individually or in the aggregate, materially
and adversely interfere with the benefits of the security intended to be
provided by the related Mortgage, the current principal use or operation of the
related Mortgaged Property or the ability of the related Mortgaged Property to
generate sufficient cashflow to enable the related Mortgagor to timely pay in
full the principal and interest on the related Mortgage Note (other than a
Balloon Payment, which would require a refinancing). If the related Mortgaged
Property is operated as a nursing facility or a hospitality property, the
related Mortgage, together with any security agreement, chattel mortgage or
similar agreement and UCC financing statement, if any, establishes and creates a
first priority, perfected security interest (subject only to any prior purchase
money security interest, revolving credit lines and any personal property
leases), to the extent such security interest can be perfected by the
recordation of a Mortgage or the filing of a UCC financing statement, in all
material personal property owned by the Mortgagor that is used in, and is
reasonably necessary to, the operation of the related Mortgaged Property as
presently operated by the Mortgagor, and that is located on the related
Mortgaged Property, which personal property includes, in the case of Mortgaged
Properties operated by the related Mortgagor as a nursing facility or
hospitality property, all furniture, fixtures, equipment and other personal
property located at the subject Mortgaged Property that are owned by the related
Mortgagor and reasonably necessary or material to the operation of the subject
Mortgaged Property. In the case of any Mortgage Loan secured by a hotel, the
related loan documents contain such provisions as are necessary and UCC
financing statements have been filed as necessary, in each case, to perfect a
valid first priority security interest, to the extent such security interest can
be perfected by the inclusion of such provisions and the filing of a UCC
financing statement, in the Mortgagor's right to receive related hotel room
revenues with respect to such Mortgaged Property.
(ix) Taxes and Assessments. All taxes, governmental assessments, water
charges, sewer rents or similar governmental charges which, in all such cases,
were directly related to the related Mortgaged Property and could constitute
liens on the related Mortgaged Property prior to the lien of the related
Mortgage, together with all ground rents, that prior to the Cut-off Date became
due and payable in respect of, and materially affect, any related Mortgaged
Property have been paid or are escrowed for or are not yet delinquent, and the
Seller knows of no unpaid tax, assessment, ground rent, water charges or sewer
rent, which, in all such cases, were directly related to the subject Mortgaged
Property and could constitute liens on the subject Mortgaged Property prior to
the lien of the related Mortgage that prior to the Closing Date became due and
delinquent in respect of any related Mortgaged Property, or in any such case an
escrow of funds in an amount sufficient to cover such payments has been
established.
(x) No Material Damage. As of the date of origination of such Mortgage
Loan and, to the actual knowledge of the Seller, as of the Closing Date, there
was no pending proceeding for the total or partial condemnation of any related
Mortgaged Property that materially affects the value thereof and such Mortgaged
Property is free of material damage. Except for certain amounts not greater than
amounts which would be considered prudent by an institutional commercial
mortgage lender with
3
respect to a similar mortgage loan and which are set forth in the related
Mortgage or other loan documents relating to such Mortgage Loan, (and subject to
any rights of the lessor under any related Ground Lease) the related Mortgage
Loan documents provide that any condemnation awards will be applied (or, at the
discretion of the mortgagee, will be applied) to either the repair or
restoration of all or part of the related Mortgaged Property or the reduction of
the outstanding principal balance of such Mortgage Loan.
(xi) Title Insurance. Each related Mortgaged Property is covered by an
ALTA (or its equivalent) lender's title insurance policy issued by a nationally
recognized title insurance company, insuring that each related Mortgage is a
valid first lien on such Mortgaged Property in the original principal amount of
such Mortgage Loan (or, if such Mortgage Loan is part of a Loan Combination, in
the original principal amount of such Loan Combination) after all advances of
principal, subject only to Permitted Encumbrances and, in the case of a Trust
Mortgage Loan that is part of a Loan Combination, further subject to the fact
that the related Mortgage also secures the related Non-Trust Mortgage Loan(s),
(or if such policy has not yet been issued, such insurance may be evidenced by a
binding commitment or binding pro forma marked as binding and signed (either
thereon or on a related escrow letter attached thereto) by the title insurer or
its authorized agent) from a title insurer qualified and/or licensed in the
applicable jurisdiction, as required, to issue such policy; such title insurance
is in full force and effect, all premiums have been paid, is freely assignable
and will inure to the benefit of the Trustee (or, in the case of the Outside
Serviced Trust Mortgage Loan, the benefit of the related Outside Trustee) as
sole insured as mortgagee of record, or any such commitment or binding pro forma
is a legal, valid and binding obligation of such insurer; no claims have been
made by the Seller or any prior holder of such Mortgage Loan (other than a prior
holder unaffiliated with the Seller from whom the Seller has taken by
assignment) under such title insurance; and neither the Seller nor any Affiliate
of the Seller has done, by act or omission, anything that would materially
impair the coverage of any such title insurance policy; such policy or
commitment or binding pro forma contains no exclusion for (or alternatively it
insures over such exclusion, unless such coverage is unavailable in the relevant
jurisdiction) (A) access to a public road, (B) that there is no material
encroachment by any improvements on the related Mortgaged Property either to or
from any adjoining property or across any easements on the related Mortgaged
Property, and (C) that the land shown on the survey materially conforms to the
legal description of the related Mortgaged Property.
(xii) Property Insurance. As of the date of its origination and, to
the Seller's actual knowledge, as of the Cut-off Date, all insurance required
under each related Mortgage (except where an investment grade tenant, or one or
more tenants which in the aggregate do not represent more than 10% of the net
operating income with respect to the entire related Mortgaged Property, is or
are permitted to insure or self-insure under a lease) was in full force and
effect with respect to each related Mortgaged Property; such insurance included
(A) fire and extended perils insurance included within the classification "All
Risk of Physical Loss" or the equivalent thereof in an amount (subject to a
customary deductible) at least equal to the lesser of (1) 100% of the full
insurable value of the improvements located on such Mortgaged Property and (2)
the outstanding principal balance of such Mortgage Loan or the portion thereof
allocable to such Mortgaged Property) and, if applicable, the related hazard
insurance policies or certificates of insurance contain appropriate endorsements
to avoid application of co-insurance, (B) business interruption or rental loss
insurance for a period of not less than 12 months, (C) comprehensive general
liability insurance in an amount not less than $1 million per occurrence, (D)
workers' compensation insurance (if the related Mortgagor has employees and if
required by applicable law), and (E) if (1) such Mortgage Loan is secured by a
Mortgaged Property located in the
4
State of California or in "seismic zone" 3 or 4 and (2) a seismic assessment as
described below revealed a maximum probable or bounded loss in excess of 20% of
the amount of the estimated replacement cost of the improvements on such
Mortgaged Property, seismic insurance; it is an event of default under such
Mortgage Loan if the above-described insurance coverage is not maintained by the
related Mortgagor (except where an investment grade tenant, or one or more
tenants which in the aggregate do not represent more than 10% of the net
operating income with respect to the entire related Mortgaged Property, is or
are permitted to insure or self-insure under a lease) and the related loan
documents provide (in either a general cost and expense recovery provision or a
specific provision with respect to recovery of insurance costs and expenses)
that any reasonable out-of-pocket costs and expenses incurred by the mortgagee
in connection with such default in obtaining such insurance coverage may be
recovered from the related Mortgagor; the related Evidence of Property Insurance
and certificate of liability insurance (which may be in the form of an Xxxxx 27
or an Xxxxx 25, respectively), or forms substantially similar thereto, provide
that the related insurance policy may not be terminated or reduced without at
least 10 days prior notice to the mortgagee and (other than those limited to
liability protection) name the mortgagee and its successors as loss payee; no
notice of termination or cancellation with respect to any such insurance policy
has been received by the Seller or, to the actual knowledge of the Seller, by
any prior mortgagee under such Mortgage Loan (other than, with respect to a
related Mortgaged Property located in New York and Florida, a prior mortgagee
unaffiliated with the Seller from whom the Seller has taken the related Mortgage
Note and Mortgage by assignment and has amended and restated such Mortgage Note
and Mortgage); all premiums under any such insurance policy have been paid
through the Cut-off Date; the insurance policies specified in clauses (A), (B)
and (C) above are required to be maintained with insurance companies having
"financial strength" or "claims paying ability" ratings of at least "A:VII" from
A.M. Best Company or at least "BBB+" (or equivalent) from a nationally
recognized statistical rating agency (or, with respect to certain blanket
insurance policies, such other ratings as are in compliance with S&P's
applicable criteria for rating the Certificates); and, except for certain
amounts not greater than amounts which would be considered prudent by an
institutional commercial mortgage lender with respect to a similar mortgage loan
and which are set forth in the related Mortgage or other loan documents relating
to such Mortgage Loan, and subject to the related exception schedules, the
related Mortgage Loan documents provide that any property insurance proceeds
will be applied (or, at the discretion of the mortgagee, will be applied) either
to the repair or restoration of all or part of the related Mortgaged Property or
the reduction of the outstanding principal balance of such Mortgage Loan;
provided, that the related Mortgage Loan documents may entitle the related
Mortgagor to any portion of such proceeds remaining after completion of the
repair or restoration of the related Mortgaged Property or payment of amounts
due under such Mortgage Loan. With respect to the subject Mortgage Loan, the
related loan documents generally require the Mortagor to maintain insurance
against windstorm damage and certain acts of terrorism (except where an
investment grade tenant is permitted to insure or self-insure under a lease or
is required to restore the premises, and except where a related sponsor has
agreed to be responsible for losses due to windstorm or certain acts of
terrorism, as the case may be, which would have otherwise been covered by
insurance); provided, that any such insurance and the amount thereof may be
limited by the commercial availability of such coverage, whether the mortgagee
may reasonably require such insurance, certain limitations with respect to the
cost thereof and/or whether such hazards are at the time commonly insured
against for property similar to the related Mortgaged Property; and provided,
further, that with respect to windstorm damage, such insurance is only required
if the related Mortgaged Property is located within 25 miles of the coast of
Florida, North Carolina, South Carolina, Georgia, Alabama, Mississippi,
Louisiana or Texas. If the related Mortgaged Property is located in the State of
California or in "seismic zone" 3 or 4, then: (A) either a seismic assessment
was conducted with respect to the
5
related Mortgaged Property in connection with the origination of such Mortgage
Loan or earthquake insurance was obtained; and (B) the probable maximum loss for
the related Mortgaged Property as reflected in such seismic assessment, if any,
was determined based upon a return period of not less than 475 years, an
exposure period of 50 years and a 10% probability of incidence. Schedule I-xii
attached hereto is true and correct in all material respects.
(xiii) No Material Defaults. Other than payments due but not yet 30
days or more delinquent, there is (A) no material default, breach, violation or
event of acceleration existing under the related Mortgage Note, the related
Mortgage or other loan documents relating to such Mortgage Loan, and (B), to the
knowledge of the Seller as of the Closing Date, no event which, with the passage
of time or with notice and the expiration of any grace or cure period, would
constitute a material default, breach, violation or event of acceleration under
any of such documents; provided, however, that this representation and warranty
does not cover any default, breach, violation or event of acceleration (A) that
specifically pertains to or arises out of the subject matter otherwise covered
by any other representation and warranty made by the Seller in this Exhibit B or
(B) with respect to which: (1) the Seller has no actual knowledge as of the
Closing Date and (2) written notice of the discovery thereof is not delivered to
the Seller by the Trustee or the Master Servicer on or prior to the date
occurring twelve months after the Closing Date. Neither the Seller nor any prior
holder of such Mortgage Loan (other than, with respect to a related Mortgaged
Property located in New York and Florida, a prior holder unaffiliated with the
Seller from whom the Seller has taken the related Mortgage Note and Mortgage by
assignment and has amended and restated such Mortgage Note and Mortgage) has
waived, in writing or with knowledge, any material default, breach, violation or
event of acceleration under any of such documents. Under the terms of such
Mortgage Loan, no person or party other than the mortgagee or its servicing
agent may declare an event of default or accelerate the related indebtedness
under such Mortgage Loan.
(xiv) No Payment Delinquency. As of the Closing Date, such Mortgage
Loan is not, and in the prior 12 months (or since the date of origination if
such Mortgage Loan has been originated within the past 12 months), has not been,
30 days or more past due in respect of any Monthly Payment.
(xv) Interest Accrual Basis. Such Mortgage Loan accrues interest on an
Actual/360 Basis, an Actual/Actual Basis or a 30/360 Basis; and such Mortgage
Loan accrues interest (payable monthly in arrears) at a fixed rate of interest
throughout the remaining term thereof (except if such Mortgage Loan is an ARD
Mortgage Loan, in which case the accrual rate for interest will increase after
its Anticipated Repayment Date, and except in connection with the occurrence of
a default and the accrual of default interest).
(xvi) Subordinate Debt. Each related Mortgage or other loan document
relating to such Mortgage Loan does not provide for or permit, without the prior
written consent of the holder of the related Mortgage Note, any related
Mortgaged Property or any direct controlling interest in the Mortgagor to secure
any other promissory note or debt (other than another Mortgage Loan in the Trust
Fund and, if such Mortgage Loan is part of a Loan Combination, the other
mortgage loan(s) that are part of such Loan Combination, as applicable).
(xvii) Qualified Mortgage. Such Mortgage Loan is a "qualified
mortgage" within the meaning of Section 860G(a)(3) of the Code. Accordingly,
either as of the date of origination or the Closing Date, the fair market value
of the real property securing such Mortgage Loan was not less than
6
80% of the "adjusted issue price" (within the meaning of the REMIC Provisions)
of such Mortgage Loan. For purposes of the preceding sentence, the fair market
value of the real property securing such Mortgage Loan was first reduced by the
amount of any lien on such real property that is senior to the lien that secures
such Mortgage Loan, and was further reduced by a proportionate amount of any
lien that is on a parity with the lien that secures such Mortgage Loan. No
action that occurs by operation of the terms of such Mortgage Loan would cause
such Mortgage Loan to cease to be a "qualified mortgage" and such Mortgage Loan
does not permit the release or substitution of collateral if such release or
substitution (A) would constitute a "significant modification" of such Mortgage
Loan within the meaning of Treasury regulations section 860G-2(b), (B) would
cause such Mortgage Loan not to be a "qualified mortgage" within the meaning of
Section 860G(a)(3) of the Code (without regard to clauses (A)(i) or (A)(ii)
thereof) or (C) would cause a "prohibited transaction" within the meaning of
Section 860F(a)(2) of the Code. 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) of
the Code.
(xviii) Prepayment Consideration. Prepayment Premiums and Yield
Maintenance Charges payable with respect to such Mortgage Loan, if any,
constitute "customary prepayment penalties" within the meaning of Treasury
regulations section 1.860G-1(b)(2).
(xix) Environmental Conditions. One or more environmental site
assessments (or updates thereof) in each instance meeting American Society of
Testing and Materials requirements were performed by an environmental consulting
firm independent of the Seller and the Seller's Affiliates with respect to each
related Mortgaged Property during the 12-month period preceding the Cut-off
Date, and the Seller, having made no independent inquiry other than to review
the report(s) prepared in connection with the assessment(s) and/or update(s)
referenced herein, has no knowledge of, and has not received actual notice of,
any material and adverse environmental condition or circumstance affecting such
Mortgaged Property that was not disclosed in such report(s); none of the
environmental reports reveal any circumstances or conditions that are in
violation of any applicable environmental laws, or if such report does reveal
such circumstances, then (1) the same have been remediated in all material
respects, (2) sufficient funds have been escrowed or a letter of credit,
guaranty or other instrument has been delivered for purposes of covering the
estimated costs of such remediation, (3) the related Mortgagor or other
responsible party set forth on Schedule I (which Mortgagor or other responsible
party has been reasonably determined by the Seller to have the creditworthiness
to do so (such determination by the Seller to be based on review of (i) the
financial statements provided to the Seller by the Mortgagor or other
responsible party, as applicable, and (ii) the reasonable cost of remediation of
the circumstances or conditions that are in violation of the applicable
environmental laws as set forth in the applicable environmental report)) is
currently taking remedial or other appropriate action to address the
environmental issue consistent with the recommendations in such site assessment,
(4) the cost of the environmental issue relative to the value of such Mortgaged
Property was de minimis, or (5) environmental insurance has been obtained.
The Mortgagor with respect to such Mortgage Loan has represented,
warranted and covenanted generally to the effect that, to its knowledge, except
as set forth in the environmental reports described above, it has not used,
caused or permitted to exist, and will not use, cause or permit to exist, on the
related Mortgaged Property, any Hazardous Materials in any manner which violates
applicable federal, state or local laws governing the use, storage, handling,
production or disposal of Hazardous Materials at the related Mortgaged Property
and (A) the related Mortgagor and a natural person have
7
agreed to indemnify the mortgagee under such Mortgage Loan, and its successors
and assigns, against any losses, liabilities, damages, penalties, fines, claims
and reasonable out of pocket expenses (excluding lost profits, consequential
damages and diminution of value of the related Mortgaged Property, provided that
no Mortgage Loan with an original principal balance equal to or greater than
$15,000,000 contains an exclusion for "diminution of value" of the related
Mortgaged Property) paid, suffered or incurred by such mortgagee resulting from
such Mortgagor's material violation of any environmental law or a material
breach of the environmental representations and warranties or covenants given by
the related Mortgagor in connection with such Mortgage Loan or (B) environmental
insurance has been obtained. If such Mortgage Loan is a Mortgage Loan as to
which neither a natural person has provided the indemnity set forth above nor
environmental insurance has been obtained, such Mortgage Loan is set forth on
Schedule I.
The Seller has not taken any action with respect to such Mortgage Loan
or the related Mortgaged Property that could subject the Seller or its
successors and assigns in respect of such Mortgage Loan to liability under
CERCLA or any other applicable federal, state or local environmental law. The
related Mortgage or other loan documents require the related Mortgagor to comply
with all applicable federal, state and local environmental laws and regulations.
(xx) Realization Against Real Estate Collateral. The related Mortgage
Note, Mortgage(s), Assignment(s) of Leases and other loan documents securing
such Mortgage Loan, if any, contain customary and, subject to the limitations
and exceptions as to enforceability in paragraph (v) above, enforceable
provisions such as to render the rights and remedies of the holder thereof
adequate for the practical realization against the related Mortgaged Property or
Properties of the principal benefits of the security intended to be provided
thereby, including realization by judicial or, if applicable, non-judicial
foreclosure.
(xxi) Bankruptcy. The related Mortgagor is not a debtor in any
bankruptcy, reorganization, insolvency or comparable proceeding; provided,
however, that this representation and warranty does not cover any such
bankruptcy, reorganization, insolvency or comparable proceeding with respect to
which: (1) the Seller has no actual knowledge and (2) written notice of the
discovery thereof is not delivered to the Seller by the Trustee or the Master
Servicer on or prior to the date occurring twelve months after the Closing Date.
(xxii) Loan Security. Such Mortgage Loan is secured by a Mortgage on a
fee simple interest and/or a leasehold estate in a commercial property or
multifamily property, including the related Mortgagor's interest in the
improvements on the related Mortgaged Property.
(xxiii) Amortization. Such Mortgage Loan does not provide for negative
amortization unless such Mortgage Loan is an ARD Mortgage Loan, in which case it
may occur only after the Anticipated Repayment Date.
(xxiv) Whole Loan. Such Mortgage Loan is a whole loan, contains no
equity participation by the lender or shared appreciation feature and does not
provide for any contingent interest in the form of participation in the cash
flow of the related Mortgaged Property.
(xxv) Due-on-Encumbrance. Each Mortgage Loan contains provisions for
the acceleration of the payment of the unpaid principal balance of such Mortgage
Loan if, without the prior written consent of the mortgagee or Rating Agency
confirmation that an Adverse Rating Event with
8
respect to any Class of Certificates would not occur, any related Mortgaged
Property or any direct controlling interest in the Mortgagor is directly
encumbered in connection with subordinate financing; and except in the case of a
Trust Mortgage Loan that is part of a Loan Combination (for which such consent
has been granted with respect to the other mortgage loan(s) in such Loan
Combination), and except for the respective Mortgage Loans secured by the
Mortgaged Properties listed on Schedule I (for which such consent has been
granted with respect to mezzanine debt), no such consent has been granted by the
Seller. To the Seller's knowledge, no related Mortgaged Property is encumbered
in connection with subordinate financing (except that each Mortgaged Property
securing a Trust Mortgage Loan that is part of a Loan Combination also secures
the other mortgage loan(s) in such Loan Combination); however, if the related
Mortgaged Property is listed on Schedule I, certain direct controlling equity
holders in the related Mortgagor are known to the Seller to have incurred debt
secured by their ownership interest in the related Mortgagor.
(xxvi) Due-on-Sale. Except with respect to transfers of certain
non-controlling and/or minority interests in the related Mortgagor as specified
in the related Mortgage or with respect to transfers of interests in the related
Mortgagor between immediate family members and with respect to transfers by
devise, by descent or by operation of law or otherwise upon the death or
incapacity of a person having an interest in the related Mortgagor, each
Mortgage Loan contains either (A) provisions for the acceleration of the payment
of the unpaid principal balance of such Mortgage Loan if any related Mortgaged
Property or interest therein is directly or indirectly transferred or sold
without the prior written consent of the mortgagee or rating agency
confirmation, or (B) provisions for the acceleration of the payment of the
unpaid principal balance of such Mortgage Loan if any related Mortgaged Property
or interest therein is directly or indirectly transferred or sold without the
related Mortgagor having satisfied certain conditions specified in the related
Mortgage with respect to permitted transfers (which conditions are consistent
with the practices of prudent commercial mortgage lenders (as defined below)).
The Mortgage (under either specific or general expense provisions) requires the
Mortgagor to pay all reasonable fees and expenses associated with securing the
consent or approval of the holder of the Mortgage for all actions involving the
transfer of interest in such Mortgagor requiring such consent or approval under
the Mortgage.
(xxvii) Mortgagor Concentration. Except in the case of the Mortgage
Loans listed on Schedule I (xxvii), such Mortgage Loan, together with any other
Mortgage Loan made to the same Mortgagor or to an Affiliate of such Mortgagor,
does not represent more than 5% of the Initial Pool Balance.
(xxviii) Waivers; Modifications. Except as set forth in a written
instrument included in the related Mortgage File, the (A) material terms of the
related Mortgage Note, the related Mortgage(s) and any related loan agreement
and/or lock-box agreement have not been waived, modified, altered, satisfied,
impaired, canceled, subordinated or rescinded by the mortgagee in any manner,
and (B) no portion of a related Mortgaged Property has been released from the
lien of the related Mortgage, in the case of (A) and/or (B), to an extent or in
a manner that in any such event materially interferes with the security intended
to be provided by such document or instrument. Schedule I identifies each
Mortgage Loan (if any) as to which, since the latest date any related due
diligence materials were delivered to American Capital Strategies Ltd. (or its
designee), there has been (in writing) given, made or consented to a material
alteration, material modification or assumption of the terms of the related
Mortgage Note, Mortgage(s) or any related loan agreement and/or lock-box
agreement and/or as to which, since such date, there has been (in writing) a
waiver other than as related to routine operational matters or minor
9
covenants.
(xxix) Inspection. Each related Mortgaged Property was inspected by or
on behalf of the related originator during the six-month period prior to the
related origination date.
(xxx) Property Release. The terms of the related Mortgage Note,
Mortgage(s) or other loan document securing such Mortgage Loan do not provide
for the release from the lien of such Mortgage of any material portion of the
related Mortgaged Property that is necessary to the operation of such Mortgaged
Property or was given material value in the underwriting of such Mortgage Loan
at origination, without (A) payment in full of such Mortgage Loan, (B) delivery
of Defeasance Collateral in the form of "government securities" within the
meaning of Section 2(a)(16) of the Investment Company Act of 1940, as amended
(the "Investment Company Act"), (C) payment of a release price equal to at least
125% of the amount of such Mortgage Loan allocated to the related Mortgaged
Property subject to the release or (D) with respect to mortgage loans listed on
Schedule I-xxx, the satisfaction of certain underwriting and legal requirements
which the Seller required in the origination of comparable mortgage loans.
(xxxi) Qualifications; Licensing; Zoning. The related Mortgagor has
covenanted in the related Mortgage Loan documents to maintain the related
Mortgaged Property in compliance in all material respects with, to the extent it
is not grandfathered under, all applicable laws, zoning ordinances, rules,
covenants and restrictions affecting the construction, occupancy, use and
operation of such Mortgaged Property, and the related originator performed the
type of due diligence in connection with the origination of such Mortgage Loan
customarily performed by prudent commercial mortgage lenders (as defined below)
with respect to the foregoing matters; the Seller has received no notice of any
material violation of, to the extent is has not been grandfathered under, any
applicable laws, zoning ordinances, rules, covenants or restrictions affecting
the construction, occupancy, use or operation of the related Mortgaged Property
(unless affirmatively covered by the title insurance referred to in paragraph
(xi) above (or an endorsement thereto)); to the Seller's knowledge (based on
surveys, opinions, letters from municipalities and/or title insurance obtained
in connection with the origination of such Mortgage Loan), no improvement that
was included for the purpose of determining the appraised value of the related
Mortgaged Property at the time of origination of such Mortgage Loan lay outside
the boundaries and building restriction lines of such property, in effect at the
time of origination of such Mortgage Loan, to an extent which would have a
material adverse affect on the related Mortgagor's use and operation of such
Mortgaged Property (unless grandfathered with respect thereto or affirmatively
covered by the title insurance referred to in paragraph (xi) above (or an
endorsement thereto)), and no improvements on adjoining properties encroached
upon such Mortgaged Property to any material extent. For purposes of this
paragraph, a Mortgaged Property shall be deemed "grandfathered" with respect to
any laws, zoning ordinances, rules, covenants or restrictions affecting the
construction, occupancy, use or operation of the related Mortgaged Property, if
and to the extent that any of the construction, occupancy, use and operation of
such Mortgaged Property: (A) conformed in all material respects with such laws,
zoning ordinances, rules, covenants and restrictions affecting the improvements
on the related Mortgaged Property at the time the improvements on the related
Mortgaged Property were initially constructed or put into operation; and/or (B)
was not addressed or otherwise prohibited by any such laws, zoning ordinances,
rules, covenants and restrictions affecting the related Mortgaged Property at
the time the improvements on the related Mortgaged Property were initially
constructed or put into operation.
10
(xxxii) Property Financial Statements. The related Mortgagor has
covenanted in the related Mortgage Loan documents to deliver to the mortgagee
annual operating statements, rent rolls and related information of each related
Mortgaged Property and annual financial statements. If such Mortgage Loan had an
original principal balance greater than $15 million, the related Mortgagor has
covenanted to provide such operating statements, rent rolls and related
information on a quarterly basis. If such Mortgage Loan has an original
principal balance equal to or greater than $20 million, the related Mortgagor,
if it obtains an audited financial statement, is required to provide a copy
thereof to the holder of such Mortgage Loan at the related mortgagee's request.
(xxxiii) Single Purpose Entity. If such Mortgage Loan has a Cut-off
Date Balance in excess of $25 million, then the related Mortgagor is obligated
by its organizational documents and the related Mortgage Loan documents to be a
Single Purpose Entity for so long as such Mortgage Loan is outstanding; and, if
such Mortgage Loan has a Cut-off Date Balance greater than $5 million and less
than $25 million, the related Mortgagor is obligated by its organizational
documents and/or the related Mortgage Loan documents to own the related
Mortgaged Property and no other material assets, except such as are incidental
to the ownership of such Mortgaged Property for so long as such Mortgage Loan is
outstanding. For purposes of this representation, "Single Purpose Entity" means
an entity whose organizational documents or the related Mortgage Loan documents
provide substantially to the effect that such entity: (A) is formed or organized
solely for the purpose of owning and operating one or more of the Mortgaged
Properties securing such Mortgage Loan, (B) may not engage in any business
unrelated to the related Mortgaged Property or Mortgaged Properties, (C) does
not have any material assets other than those related to its interest in and
operation of such Mortgaged Property or Mortgaged Properties and (D) may not
incur indebtedness other than as permitted by the related Mortgage or other
Mortgage Loan documents. If such Mortgage Loan has an initial principal balance
of $25 million and above and the related Mortgagor is a single member limited
liability company, such Mortgagor's organizational documents provide that such
Mortgagor shall not dissolve or liquidate upon the bankruptcy, dissolution,
liquidation or death of its sole member and is organized in a jurisdiction that
provides for such continued existence and there was obtained opinion of counsel
confirming such continued existence. If such Mortgage Loan has, or is part of a
group of Mortgage Loans with affiliated Mortgagors having, a Cut-off Date
Balance equal to or greater than 2% of the Initial Pool Balance, or if such
Mortgage Loan has an original principal balance equal to or greater than $25
million, there was obtained an opinion of counsel regarding non-consolidation of
such Mortgagor.
(xxxiv) Advancing of Funds. No advance of funds has been made,
directly or indirectly, by the originator or the Seller to the related Mortgagor
other than pursuant to the related Mortgage Note; and, to the actual knowledge
of the Seller, no funds have been received from any Person other than such
Mortgagor for or on account of payments due on the related Mortgage Note.
(xxxv) Legal Proceedings. To the Seller's actual knowledge, there are
no pending actions, suits or proceedings by or before any court or governmental
authority against or affecting the related Mortgagor or any related Mortgaged
Property that, if determined adversely to such Mortgagor or Mortgaged Property,
would materially and adversely affect the value of such Mortgaged Property or
the ability of such Mortgagor to pay principal, interest or any other amounts
due under such Mortgage Loan.
(xxxvi) Originator Duly Authorized. To the extent required under
applicable law as of the Closing Date, the originator of such Mortgage Loan was
qualified and authorized to do business in each jurisdiction in which a related
Mortgaged Property is located at all times when it held such Mortgage
11
Loan to the extent necessary to ensure the enforceability of such Mortgage Loan.
(xxxvii) Trustee under Deed of Trust. If the related Mortgage is a
deed of trust, a trustee, duly qualified under applicable law to serve as such,
is properly designated and serving under such Mortgage, and no fees and expenses
are payable to such trustee except in connection with a trustee sale of the
related Mortgaged Property following a default or in connection with the release
of liens securing such Mortgage Loan and any such fees and expenses are the
obligation of the Mortgagor under the terms of the Mortgage.
(xxxviii) Cross-Collateralization. The related Mortgaged Property is
not, to the Seller's knowledge, collateral or security for any mortgage loan
that is not in the Trust Fund and, if such Mortgage Loan is
cross-collateralized, it is cross-collateralized only with other Mortgage Loans
in the Trust Fund, except that a Trust Mortgage Loan that is part of a Loan
Combination is secured by one or more Mortgaged Properties that also secure the
related Non-Trust Mortgage Loan(s). The security interest/lien on each material
item of collateral for such Mortgage Loan has been assigned to the Trustee.
(xxxix) Flood Hazard Insurance. None of the improvements on any
related Mortgaged Property are located in a flood hazard area as defined by the
Federal Insurance Administration or, if any portion of the improvements on the
related Mortgaged Property are in an area identified in the Federal Register by
the Federal Emergency Management Agency as having special flood hazards falling
within zones A or V in the national flood insurance program, the Mortgagor has
obtained and is required to maintain flood insurance.
(xl) Engineering Assessments. One or more engineering assessments or
updates of a previously conducted engineering assessment were performed by an
Independent engineering consulting firm with respect to each related Mortgaged
Property during the 12-month period preceding the Cut-off Date, and the Seller,
having made no independent inquiry other than to review the report(s) prepared
in connection with such assessment(s) and or update(s), does not have any
knowledge of any material and adverse engineering condition or circumstance
affecting such Mortgaged Property that was not disclosed in such report(s); and,
to the extent such assessments revealed deficiencies, deferred maintenance or
similar conditions, either (A) the estimated cost has been escrowed or a letter
of credit has been provided, (B) repairs have been made or (C) the scope of the
deferred maintenance relative to the value of such Mortgaged Property was de
minimis.
(xli) Escrows. All escrow deposits and payments relating to such
Mortgage Loan are under control of the Seller or the servicer of such Mortgage
Loan and all amounts required as of the date hereof under the related Mortgage
Loan documents to be deposited by the related Mortgagor have been deposited. The
Seller is transferring to the Trustee all of its right, title and interest in
and to such amounts.
(xlii) Licenses, Permits and Authorizations. The related Mortgagor has
represented in the related Mortgage Loan documents that, and to the actual
knowledge of the Seller, as of the date of origination of such Mortgage Loan,
all material licenses, permits and authorizations then required for use of the
related Mortgaged Property by such Mortgagor, the related lessee, franchisor or
operator have been issued and were valid and in full force and effect.
(xliii) Servicing and Collection Practices. The servicing and
collection practices used
12
by the Seller or, to the Seller's knowledge, any prior holder of the related
Mortgage Note with respect to such Mortgage Loan have been in all respects legal
and have met customary industry standards.
(xliv) Fee Simple. Unless such Mortgage Loan is covered by the
representation and warranty in the immediately following paragraph (xlv), such
Mortgage Loan is secured in whole or material part by a fee simple interest.
(xlv) Leasehold Interest Only. If such Mortgage Loan is secured in
whole or in material part by the interest of the related Mortgagor as a lessee
under a Ground Lease but not by the related fee interest, then:
(A) such Ground Lease or a memorandum thereof has been or will
be duly recorded and such Ground Lease permits the interest
of the lessee thereunder to be encumbered by the related
Mortgage or, if consent of the lessor thereunder is
required, it has been obtained prior to the Closing Date;
(B) upon the foreclosure of such Mortgage Loan (or acceptance of
a deed in lieu thereof), the Mortgagor's interest in such
Ground Lease is assignable to the Trustee (or, in the case
of the Outside Serviced Trust Mortgage Loan, to the related
Outside Trustee) without the consent of the lessor
thereunder (or, if any 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 Trustee (or,
in the case of the Outside Serviced Trust Mortgage Loan, by
the related Outside Trustee) and its successors without a
need to obtain the consent of such lessor (or, if any such
consent is required, it has been obtained prior to the
Closing Date or may not be unreasonably withheld);
(C) such Ground Lease may not be amended or modified without the
prior written consent of the mortgagee under such Mortgage
Loan and any such action without such consent is not binding
on such mortgagee, its successors or assigns;
(D) unless otherwise set forth in such Ground Lease, such Ground
Lease does not permit any increase in the amount of rent
payable by the ground lessee thereunder during the term of
such Mortgage Loan;
(E) such Ground Lease was in full force and effect as of the
date of origination of the related Mortgage Loan and, at the
Closing Date, such Ground Lease is in full force and effect;
to the actual knowledge of the Seller, except for payments
due but not yet 30 days or more delinquent, (1) there is no
material default under such Ground Lease, and (2) there is
no event which, with the passage of time or with notice and
the expiration of any grace or cure period, would constitute
a material default under such Ground Lease;
(F) such Ground Lease, or an estoppel or consent letter received
by the mortgagee under such Mortgage Loan from the lessor,
requires the lessor thereunder to give notice of any default
by the lessee to such mortgagee; and such Ground Lease, or
an estoppel or consent letter received by the mortgagee
under such
13
Mortgage Loan from the lessor, further provides either (1)
that no notice of termination given under such Ground Lease
is effective against such mortgagee unless a copy has been
delivered to the mortgagee in the manner described in such
Ground Lease, estoppel or consent letter or (2) that upon
any termination of such Ground Lease the lessor will enter
into a new lease with such mortgagee upon such mortgagee's
request;
(G) based upon the related policy of title insurance, the ground
lessee's interest in such Ground Lease is not subject to any
liens or encumbrances superior to, or of equal priority
with, the related Mortgage, other than the related ground
lessor's related fee interest and any Permitted
Encumbrances;
(H) the mortgagee under such Mortgage Loan is permitted a
reasonable opportunity to cure any curable default under
such Ground Lease (not less than the time provided to the
related lessee under such Ground Lease to cure such default)
before the lessor thereunder may terminate or cancel such
Ground Lease;
(I) such Ground Lease has a currently effective term (including
any options exercisable by the holder of the related
Mortgage) that extends not less than 20 years beyond the
Stated Maturity Date of the related Mortgage Loan;
(J) under the terms of such Ground Lease, any estoppel or
consent letter received by the mortgagee under such Mortgage
Loan from the lessor and the related Mortgage Loan
documents, taken together, any related insurance proceeds,
other than de minimis amounts for minor casualties, with
respect to the leasehold interest, or condemnation proceeds
will be applied either to the repair or restoration of all
or part of the related Mortgaged Property, with the
mortgagee or a trustee appointed by it having the right to
hold and disburse such proceeds as the repair or restoration
progresses (except in such cases where a provision entitling
another party to hold and disburse such proceeds would not
be viewed as commercially unreasonable by a prudent
commercial mortgage lender), or to the payment of the
outstanding principal balance of the Mortgage Loan, together
with any accrued interest thereon;
(K) such Ground Lease does not impose any restrictions on use or
subletting which would be viewed as commercially
unreasonable by a prudent commercial mortgage lender;
(L) upon the request of the mortgagee under such Mortgage Loan,
the ground lessor under such Ground Lease is required to
enter into a new lease upon termination of the Ground Lease
for any reason prior to the expiration of the term thereof,
including as a result of the rejection of the Ground Lease
in a bankruptcy of the related Mortgagor unless the
mortgagee under such Mortgage Loan fails to cure a default
of the lessee under such Ground Lease following notice
thereof from the lessor; and
(M) the terms of the related Ground Lease have not been waived,
modified,
14
altered, satisfied, impaired, canceled, subordinated or
rescinded in any manner which materially interferes with the
security intended to be provided by such Mortgage, except as
set forth in an instrument or document contained in the
related Mortgage File.
(xlvi) Fee Simple and Leasehold Interest. If such Mortgage Loan is
secured by the interest of the related Mortgagor under a Ground Lease and by the
related fee interest, then (A) such fee interest is subject, and subordinated of
record, to the related Mortgage, (B) the related Mortgage does not by its terms
provide that it will be subordinated to the lien of any other mortgage or other
lien upon such fee interest, and (C) upon occurrence of a default under the
terms of the related Mortgage by the related Mortgagor, the mortgagee under such
Mortgage Loan has the right (subject to the limitations and exceptions set forth
in paragraph (v) above) to foreclose upon or otherwise exercise its rights with
respect to such fee interest.
(xlvii) Tax Lot; Utilities. Each related Mortgaged Property
constitutes one or more complete separate tax lots (or the related Mortgagor has
covenanted to obtain separate tax lots and an escrow of funds in an amount
sufficient to pay taxes resulting from a breach thereof has been established) or
is subject to an endorsement under the related title insurance policy; and each
related Mortgaged Property is served by a public or other acceptable water
system, a public sewer (or, alternatively, a septic) system, and other customary
utility facilities.
(xlviii) Defeasance. If such Mortgage Loan is a Defeasance Mortgage
Loan, the related Mortgage Loan documents require the related Mortgagor to pay
all reasonable costs associated with the defeasance thereof, and either: (A)
require the prior written consent of, and compliance with the conditions set by,
the holder of such Mortgage Loan for defeasance or (B) require that (1)
defeasance may not occur prior to the second anniversary of the Closing Date,
(2) the Defeasance Collateral must be government securities within the meaning
of Treasury regulations section 1.860G-2(a)(8)(i) and must be sufficient to make
all scheduled payments under the related Mortgage Note when due (assuming for
each ARD Mortgage Loan that it matures on its Anticipated Repayment Date or on
the date when any open prepayment period set forth in the related Mortgage Loan
documents commences) or, in the case of a partial defeasance that effects the
release of a material portion of the related Mortgaged Property, to make all
scheduled payments under the related Mortgage Note on that part of such Mortgage
Loan equal to at least 110% of the allocated loan amount of the portion of the
Mortgaged Property being released, (3) an independent accounting firm (which may
be the Mortgagor's independent accounting firm) certify that the Defeasance
Collateral is sufficient to make such payments, (4) such Mortgage Loan be
assumed by a successor entity designated by the holder of such Mortgage Loan (or
by the Mortgagor with the approval of such lender), and (5) counsel provide an
opinion letter to the effect that the Trustee (or, in the case of the Outside
Serviced Trust Mortgage Loan, the related Outside Trustee) has a perfected
security interest in such Defeasance Collateral prior to any other claim or
interest.
(xlix) Primary Servicing Rights. Except with respect to the Outside
Servicers, no Person has been granted or conveyed the right to primary service
such Mortgage Loan or receive any consideration in connection therewith except
(A) as contemplated in this Agreement with respect to primary servicers that are
to be sub-servicers of the Master Servicer, (B) as has been conveyed to the
Master Servicer, in its capacity as a primary servicer, or (C) as has been
terminated.
(l) Mechanics' and Materialmen's Liens. As of origination and, to the
Seller's actual
15
knowledge, as of the Closing Date, (A) the related Mortgaged Property is free
and clear of any and all mechanics' and materialmen's liens that are not bonded,
insured against or escrowed for, and (B) 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 (unless affirmatively covered by the title insurance
referred to in paragraph (xi) above (or an endorsement thereto)). The Seller has
not received actual notice with respect to such Mortgage Loan that any
mechanics' and materialmen's liens have encumbered such Mortgaged Property since
origination that have not been released, bonded, insured against or escrowed
for.
(li) Due Date. Subject to any business day convention imposed by the
related loan documents, the Due Date for such Mortgage Loan is scheduled to be
the first day, the seventh day, the tenth day or the eleventh day of each month.
(lii) Assignment of Leases. Subject only to Permitted Encumbrances,
the related Assignment of Leases set forth in or separate from the related
Mortgage and delivered in connection with such Mortgage Loan establishes and
creates a valid and, subject only to the exceptions and limitations in paragraph
(v) above, enforceable first priority lien and first priority security interest
in the related Mortgagor's right to receive payments due under any and all
leases, subleases, licenses or other agreements pursuant to which any Person is
entitled to occupy, use or possess all or any portion of the related Mortgaged
Property subject to the related Mortgage, except that a license may have been
granted to the related Mortgagor to exercise certain rights and perform certain
obligations of the lessor under the relevant lease or leases; and each assignor
thereunder has the full right to assign the same.
(liii) Mortgagor Formation or Incorporation. To the Seller's
knowledge, the related Mortgagor is a Person formed or incorporated in a
jurisdiction within the United States.
(liv) No Ownership Interest in Mortgagor. The Seller has no ownership
interest in the related Mortgaged Property or the related Mortgagor other than
as the holder of such Mortgage Loan being sold and assigned, and neither the
Seller nor any affiliate of the Seller has any obligation to make any capital
contributions to the related Mortgagor under the Mortgage or any other related
Mortgage Loan document.
(lv) No Undisclosed Common Ownership. To the Seller's knowledge,
except where multiple properties secure an individual Mortgage Loan and except
for properties securing Mortgage Loans that are cross-defaulted and
cross-collateralized, no two properties securing Mortgage Loans are directly or
indirectly under common ownership.
(lvi) Loan Outstanding. Such Mortgage Loan has not been satisfied in
full, and except as expressly contemplated by the related loan agreement or
other documents contained in the related Mortgage File, no material portion of
the related Mortgaged Property has been released.
(lvii) Usury. Such Mortgage Loan complied with or was exempt from all
applicable usury laws in effect at its date of origination.
(lviii) ARD Mortgage Loan. If such Mortgage Loan is an ARD Mortgage
Loan, then:
(A) the related Anticipated Repayment Date is not less than five
years from the origination date for such Mortgage Loan;
16
(B) such Mortgage Loan provides that from the related
Anticipated Repayment Date through the maturity date for
such Mortgage Loan, all excess cash flow (net of normal
monthly debt service on such Mortgage Loan, monthly expenses
reasonably related to the operation of the related Mortgaged
Property, amounts due for reserves established under such
Mortgage Loan, and payments for any other expenses,
including capital expenses, related to such Mortgaged
Property which are approved by mortgagee) will be applied to
repay principal due under such Mortgage Loan;
(C) no later than the related Anticipated Repayment Date, the
related Mortgagor is required (if it has not previously done
so) to enter into a "lockbox agreement" whereby all revenue
from the related Mortgaged Property will be deposited
directly into a designated account controlled by the
mortgagee under such Mortgage Loan; and
(D) the interest rate of such Mortgage Loan will increase by at
least two (2) percentage points in connection with the
passage of its Anticipated Repayment Date.
(lix) Appraisal. An appraisal of the related Mortgaged Property was
conducted in connection with the origination of such Mortgage Loan; and such
appraisal satisfied either (A) the requirements of the "Uniform Standards of
Professional Appraisal Practice" as adopted by the Appraisal Standards Board of
the Appraisal Foundation, or (B) the guidelines in Title XI of the Financial
Institutions Reform, Recovery and Enforcement Act of 1989, in either case as in
effect on the date such Mortgage Loan was originated.
For purposes of the foregoing representations and warranties, the
phrases "to the knowledge of the Seller" or "to the Seller's knowledge" shall
mean, except where otherwise expressly set forth above, the actual state of
knowledge of the Seller at the time of the origination of the particular
Mortgage Loan regarding the matters referred to, in each case after having
conducted such inquiry and due diligence into such matters as is customarily
performed (at the time the subject Mortgage Loan was originated) by prudent
institutional commercial or multifamily (as applicable) mortgage lenders
originating fixed-rate mortgage loans for securitization similar to the subject
Mortgage Loan, which inquiry and due diligence, in each case, would be commonly
applicable at such time taking into account the facts, circumstances and
characteristics of the subject Mortgage Loan and Mortgaged Property, and the
phrases "to the actual knowledge of the Seller" or "to the Seller's actual
knowledge" shall mean, except where otherwise expressly set forth above, the
actual state of the Seller's knowledge, at the time of the origination of the
particular Mortgage Loan regarding the matters referred to, in each case without
any express or implied obligation to make any inquiry or conduct any due
diligence. For purposes of the foregoing representations and warranties, with
respect to matters referred to that occurred subsequent to the origination of
the subject Mortgage Loan and with respect to the phrases "to the knowledge of
the Seller," "to the Seller's knowledge," "to the actual knowledge of the
Seller" or "to the Seller's actual knowledge," the term "Seller" shall be deemed
to include Wachovia, solely in its capacity as interim servicer (if applicable)
of the subject Mortgage Loan subsequent to origination of and prior to the
Closing Date for the subject Mortgage Loan.
17
For purposes of the foregoing representations and warranties, the
phrases "would be considered prudent by an institutional commercial mortgage
lender" or "consistent with the practices of prudent commercial mortgage
lenders" or "customarily performed by prudent commercial mortgage lenders" or
"would not be viewed as commercially unreasonable by a prudent commercial
mortgage lender" and/or other references to "prudent commercial mortgage
lender(s)" shall, in each case, mean the subject action, inaction,
consideration, determination, or lending practice would be reasonably consistent
with the practices or procedures commonly followed (at the time the subject
action, inaction, consideration, determination, or lending practice occurred) by
commercial mortgage lenders originating fixed-rate mortgage loans for
securitization similar to the Mortgage Loans, which practices or procedures, in
each case, would be commonly applicable at such time taking into account the
facts, circumstances and characteristics of the subject Mortgage Loan.
18
SCHEDULE I
LB-UBS 2006-C4
EXCEPTIONS TO REPRESENTATIONS AND WARRANTIES
----------------------------------------------------------------------------------------------------------------------
CONTROL NO. REPRESENTATION PROPERTY ISSUE
-------------- ------------------------ -------------------------- ---------------------------------------------------
23 (v) La Pacifica Apartments The loan is full recourse until a 1.20x debt
service coverage ratio (on a trailing 6 month
Loan Document Status basis and calculated using a 30 year amortization
schedule) is reached. Thereafter, the loan is
springing full recourse if the debt service
coverage ratio falls below 1.10x (on a trailing 6
month basis and calculated on an interest-only
basis) until the debt service coverage ratio is
greater than 1.10x (on a trailing 3 month basis
and calculated on an interest only basis).
-------------- ------------------------ -------------------------- ---------------------------------------------------
71 (v) Arizona Self Storage The loan is full recourse until a 1.20x debt
service coverage ratio (on a trailing 6 month
Loan Document Status basis and calculated using a 30 year amortization
schedule) is reached.
-------------- ------------------------ -------------------------- ---------------------------------------------------
40, 48, 58, (v) CVS-Waynesville There is no indemnity and guaranty for
62, 68, 70, nonrecourse carveouts by any guarantor.
76, 77, 80, Loan Document Status Walgreens-Crest Hill
83, 89, 92
Walgreens-Antioch
CVS-Xxxxxxx
Walgreens-Saraland
Walgreens-Decatur
Walgreens-Roselle
0000 Xxxxxxxxxxx Xxxx
70 Reems Creek
0000 Xxxxx Xxxxx
----------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------
CONTROL NO. REPRESENTATION PROPERTY ISSUE
-------------- ------------------------ -------------------------- ---------------------------------------------------
000 Xxxxxxxx Xxxxx
101 Reliance Road
-------------- ------------------------ -------------------------- ---------------------------------------------------
25 (v) Royal Xxxxxxx Xxxx The loan is full recourse to the sponsor until
the space currently leased to Xxxxx Xxxxxxx
Loan Document Status Xxxxxx & Xxxxxx is leased to a new tenant
acceptable to the lender in its sole discretion.
If the lease renewal or replacement lease is
otherwise acceptable but for the base rent
provisions, then the loan is full recourse until
a 1.20x debt service coverage ration (on a
trailing 12 month basis and calculated using a 30
year amortization schedule) is reached.
-------------- ------------------------ -------------------------- ---------------------------------------------------
99 (v) Toys R Us Center In the event Toys R Us, Inc. ceases to be in
occupancy and open for business or otherwise
Loan Document Status closes its retail business for any reason (other
than during repair due to a casualty) for a period
of 30 days or more or the Toys R Us, Inc. lease is
terminated, the loan is full recourse to the
sponsor.
-------------- ------------------------ -------------------------- ---------------------------------------------------
13, 26, (v) 000 Xxxxxxx Xxxxxx A natural person did not provide the guaranty for
27A1, 88 nonrecourse carveouts.
Loan Document Status Holiday Inn Express
Hotel & Suites King of
Prussia
Holiday Inn Express
Xxxxxx-Malvern
Courtyard by Marriott
Wilmington Brandywine
-------------- ------------------------ -------------------------- ---------------------------------------------------
26, 27A1, 88 (v) Holiday Inn Express The loan documents include an Assignment of
Hotel & Suites King of Assignment of Leases, as opposed to an Assignment
Loan Document Status Prussia of Leases.
Holiday Inn Express
Xxxxxx-Malvern
----------------------------------------------------------------------------------------------------------------------
-2-
----------------------------------------------------------------------------------------------------------------------
CONTROL NO. REPRESENTATION PROPERTY ISSUE
-------------- ------------------------ -------------------------- ---------------------------------------------------
Courtyard by Marriott
Wilmington Brandywine
-------------- ------------------------ -------------------------- ---------------------------------------------------
N/A (v) All Properties With respect to the nonrecourse carveout
guarantee concerning fraud, certain of the
Loan Document Status guarantors have only agreed to be liable in
connection with and to the extent of any material
fraud or material intentional fraud or material
misrepresentations or material intentional
misrepresentation by the related mortgagor.
With respect to the nonrecourse carveout covering
misapplication or misappropriation, some guarantors
have agreed to cover "misapplication or conversion"
or "misappropriation or conversion" and some such
non-recourse carve-outs apply only during the
continuance of an event of default.
-------------- ------------------------ -------------------------- ---------------------------------------------------
13 (viii) 000 Xxxxxxx Xxxxxx The mortgage loan is a B Note secured by a
mortgaged property which also secures two senior
First Lien A Notes.
-------------- ------------------------ -------------------------- ---------------------------------------------------
24 (viii) 0000 Xxxxxx Xxxxxx The mortgage loan is structured as an indenture
deed of trust.
First Lien
-------------- ------------------------ -------------------------- ---------------------------------------------------
13 (xi) 000 Xxxxxxx Xxxxxx The mortgage loan is a B Note secured by a
mortgaged property which also secures two senior
Title Insurance A Notes.
-------------- ------------------------ -------------------------- ---------------------------------------------------
23 (xi) La Pacifica Apartments An exception to the title insurance policy
permits drilling for gas, minerals, hydrocarbon
Title Insurance or other substances at and under the mortgaged
property. The title policy contains an
endorsement with respect to loss relating to any
damage to the improvements due to any such
drilling. In addition, the non-recourse
provisions of the loan documents contain a carve
out with respect to such drilling.
----------------------------------------------------------------------------------------------------------------------
-3-
----------------------------------------------------------------------------------------------------------------------
CONTROL NO. REPRESENTATION PROPERTY ISSUE
-------------- ------------------------ -------------------------- ---------------------------------------------------
49 (xi) Dr.'s Medical An exception to the title insurance policy
Plaza references a commercial condominium plan. The
Title Insurance exception acknowledges that a prior landowner
obtained the right to convert the ownership of
the property from fee simple to a condominium
ownership with the right to sell off units.
While the applicable government approval has
been obtained, neither the prior or current
owner has not exercised its conversion right.
The loan documents include a representation that
the ownership interest is fee simple and contain
prohibitions on conversion. The loan is full
recourse fro a breach of this representation and
if the borrower sells any units in violation of
the due on sale provisions.
-------------- ------------------------ ------------------ --------------------------------------------------
32 (xii) Countryview MHC The borrower is not required to insure the
occupant improvements (mobile homes). There is
Property Insurance not flood insurance for improvements, as the
improvements are not owned by the borrower. The
mortgage loan is recourse to the borrower in an
amount equal to the proceeds which would have
been available to the borrower if the borrower
had carried business interruption insurance with
respect to floods.
-------------- ------------------------ ------------------ --------------------------------------------------
40, 48, 58, (xii) CVS-Waynesville Tenant self insures.
62, 70, 76,
77, 80, 83, Property Insurance Walgreens-Crest
89, 92, 130 Hill
Walgreens-Antioch
Walgreens-Saraland
Walgreens-Jacksonville
----------------------------------------------------------------------------------------------------------------------
-4-
----------------------------------------------------------------------------------------------------------------------
CONTROL NO. REPRESENTATION PROPERTY ISSUE
-------------- ------------------------ -------------------------- ---------------------------------------------------
Walgreens-Decatur
Walgreens-Roselle
0000 Xxxxxxxxxxx
Xxxx
00 Xxxxx Xxxxx
0000 Xxxxx Xxxxx
000 Xxxxxxxx
Xxxxx
000 Xxxxxxxx Xxxx
-------------- ------------------------ ------------------ --------------------------------------------------
40, 48, 58, (xii) Walgreens-Crest Business interruption insurance is not required
62, 70, 76, Hill because rent does not xxxxx in the event of a
77, 80, 83, Property Insurance casualty.
89 Walgreens-Antioch
Walgreens-Saraland
Walgreens-Decatur
Walgreens-Roselle
0000 Xxxxxxxxxxx
Xxxx
00 Xxxxx Xxxxx
0000 Xxxxx Xxxxx
000 Xxxxxxxx
Xxxxx
000 Xxxxxxxx Xxxx
-------------- ------------------------ ------------------ --------------------------------------------------
130 (xii) Walgreens- Business interruption insurance is not
Jacksonville required. $261,000 was escrowed at closing. If
Property Insurance an insured casualty occurs and rent abates under
the lease, the Borrower may elect to apply the
funds in the escrow to the payment of monthly
debt service. At such time as rent no longer
abates or other rents exceed the monthly debt
service amount, the Borrower is
----------------------------------------------------------------------------------------------------------------------
-5-
-------------------------------------------------------------------------------------------------------------
CONTROL NO. REPRESENTATION PROPERTY ISSUE
-------------- ------------------------ ------------------ --------------------------------------------------
required to replenish the escrow out of excess
cash flow until the amount therein reaches
$261,000 and the mortgage loan shall be recourse to
the borrower and the sponsor until such time in an
amount equal to the difference between $261,000 and
the amount in the escrow account.
-------------- ------------------------ ------------------ --------------------------------------------------
13 and others (xii) Certain The business interruption policy is in an amount
Properties, sufficient to provide proceeds which will cover the
Property Insurance including actual loss of income sustained during the actual
888 Seventh period of restoration.
Avenue
-------------- ------------------------ ------------------ --------------------------------------------------
N/A (xii) All Properties With respect to certain mortgage loans, the
lender accepted comprehensive liability
Property Insurance insurance in an amount less than that required
by the loan documents, provided, that this
exception does not apply to the Green Valley
Portfolio Loan, provided further, however, that
all the mortgage loans provide a primary general
liability policy of at least $1,000,000 per
occurrence with $2,000,000 in the aggregate.
-------------- ------------------------ ------------------ --------------------------------------------------
63 (xiv) Rite Aid-Church Pursuant to the related loan documents, the
Street tenant deposits rent directly into a lockbox
No Payment Delinquency account held by a servicer and the servicer
remits the monthly debt service payment to the
lender from such account. The terms of the loan
documents called for an increase of
approximately $3,806 in the monthly amortization
payment due from the borrower commencing with
the payment date in September 2004, however, the
servicer failed to increase the payment remitted
to the lender from the lockbox account.
Consequently, the full monthly debt service
payment due pursuant to the loan documents was
not received by the lender commencing with the
payment date in September 2004 up to and
-------------------------------------------------------------------------------------------------------------
-6-
-------------------------------------------------------------------------------------------------------------
CONTROL NO. REPRESENTATION PROPERTY ISSUE
-------------- ------------------------ ------------------ --------------------------------------------------
including the payment date in May 2006. The
servicer extended an unsecured loan to the
principals of the borrower in the amount of the
shortfall, which calls for repayment over a
twelve (12) month period. The proceeds of the
loan have been contributed to the borrower and,
on the payment date in June 2006, the borrower
is expected to pay all past due amortization.
-------------- ------------------------ ------------------ --------------------------------------------------
13 (xvi) 888 Seventh The mortgage loan is a subordinate B note. The
Avenue mortgaged property also secures to senior A
Subordinate Debt notes.
-------------- ------------------------ ------------------ --------------------------------------------------
40, 48, 58, (xvi) Walgreens-Roselle The borrowers are permitted to procure mezzanine
62, 68, 70, debt subject to the terms of the loan
76, 77, 80, Subordinate Debt Walgreens-Saraland documents.
83, 89, 92
Walgreens-Antioch
Walgreens-Crest
Hill
CVS-Waynesville
CVS-Xxxxxxx
Walgreens-Decatur
0000 Xxxxxxxxxxx
Xxxx
00 Xxxxx Xxxxx
0000 Xxxxx Xxxxx
000 Xxxxxxxx
Xxxxx
000 Xxxxxxxx Xxxx
-------------- ------------------------ ------------------ --------------------------------------------------
N/A (xvi) All Properties The loan documents allow the borrower to incur
certain trade payables and equipment financing
Subordinate Debt up to a predetermined amount, which is generally
less than or equal to 5% of the loan amount.
-------------------------------------------------------------------------------------------------------------
-7-
-------------------------------------------------------------------------------------------------------------
CONTROL NO. REPRESENTATION PROPERTY ISSUE
-------------- ------------------------ ------------------ --------------------------------------------------
13, 40, 48, (xix) 888 Seventh There is no natural person who is an indemnitor
58, 62, 68, Avenue under the environmental indemnity agreement.
70, 76, 77, Environmental
80, 83, 89, Conditions CVS-Waynesville
92, 26,
27A1, 00 Xxxxxxxxx-Xxxxx
Xxxx
Xxxxxxxxx-Xxxxxxx
XXX-Xxxxxxx
Xxxxxxxxx-Xxxxxxxx
Walgreens-Decatur
Walgreens-Roselle
0000 Xxxxxxxxxxx
Xxxx
00 Xxxxx Xxxxx
0000 Xxxxx Xxxxx
000 Xxxxxxxx
Xxxxx
000 Xxxxxxxx Xxxx
Holiday Inn
Express Hotel &
Suites King of
Prussia
Holiday Inn
Express
Xxxxxx-Malvern
Courtyard by
Marriott
Wilmington
Brandywine
-------------- ------------------------ ------------------ --------------------------------------------------
13 (xxiv) 888 Seventh The mortgage loan is a B Note secured by a
Avenue mortgaged property which also secures two senior
Whole Loan A Notes.
-------------------------------------------------------------------------------------------------------------
-8-
-------------------------------------------------------------------------------------------------------------
CONTROL NO. REPRESENTATION PROPERTY ISSUE
-------------- ------------------------ ------------------ --------------------------------------------------
40, 48, 58, (xxv) Walgreens-Roselle The borrowers are permitted to procure mezzanine
62, 68, 70, debt subject to the terms of the loan documents.
76, 77, 80, Due-on-Encumbrance Walgreens-Saraland
83, 89, 92,
26, 27A1, 88 Walgreens-Antioch
Walgreens-Crest
Hill
CVS-Waynesville
CVS-Xxxxxxx
Walgreens-Decatur
0000 Xxxxxxxxxxx
Xxxx
00 Xxxxx Xxxxx
0000 Xxxxx Xxxxx
000 Xxxxxxxx
Xxxxx
000 Xxxxxxxx Xxxx
Holiday Inn
Express Hotel &
Suites King of
Prussia
Holiday Inn
Express
Xxxxxx-Malvern
Courtyard by
Marriott
Wilmington
Brandywine
-------------- ------------------------ ------------------ --------------------------------------------------
N/A (xxv) All Properties The loan documents allow the borrower to incur
certain trade payables and equipment financing
Due-on-Encumbrance up to a predetermined
amount, which is
generally less than
or equal to 5% of the
loan amount.
-------------------------------------------------------------------------------------------------------------
-9-
-------------------------------------------------------------------------------------------------------------
CONTROL NO. REPRESENTATION PROPERTY ISSUE
-------------- ------------------------ ------------------ --------------------------------------------------
Interests in borrower may be transferred to any
40, 48, 58, (xxvi) Walgreens-Crest entity in which UBS Real Estate Investments Inc.
62, 68, 70, Hill ("UBSREI") or UBS AG (or any of their respective
76, 77, 80, Due-on-Sale affiliates) holds any interests or investment
89, 92 CVS-Waynesville in and to any entity in which UBSREI or UBS AG
is merged into or consolidated with.
CVS-Xxxxxxx Additionally, UBSREI may, without the consent of
lender, transfer or assign, or cause the
Walgreens-Saraland transfer or assignment of, all or any portion
of the direct or indirect interests in borrower
Walgreens-Decatur or may permit a transfer, directly or
indirectly, of any direct or indirect interest
Walgreens-Roselle in UBSREI or borrower, to (x) any fund advised
by UBSREI or an "affiliate" of UBSREI, or (y)
2802 Bloomington any other entity as long as, in the case of this
Road clause (y) only, UBSREI, an affiliate of UBSREI,
or a fund advised by UBSREI or an affiliate of
70 Reems Creek UBSREI either directly or indirectly (1)
"controls" such entity or (2) is empowered to
0000 Xxxxx Xxxxx conduct, (or directly or indirectly controls an
entity that is empowered to conduct), all
100 Rockwell day-to-day management of the Mortgaged Property
Drive and, subject to obtaining the consent of other
persons or entities that may have an interest
000 Xxxxxxxx Xxxx therein, has the right to participate in (or
directly or indirectly controls an entity that has
the right to participate in), all day-to-day
management of the Mortgaged Property.
Additionally, nothing in the loan documents
restricts the right of UBSREI to engage in
repurchase transactions or any pledge,
hypothecation, or re-hypothecation transaction with
respect to its indirect ownership of the
partnership interests in borrower.
-------------- ------------------------ ------------------ --------------------------------------------------
71 (xxvi) Arizona Self The tenants in common may transfer their
Storage interest to an entity controlled by Xxxxxx
Due-on-Sale Xxxxxx upon the satisfaction of certain conditions
in the loan documents.
-------------------------------------------------------------------------------------------------------------
-10-
-------------------------------------------------------------------------------------------------------------
CONTROL NO. REPRESENTATION PROPERTY ISSUE
-------------- ------------------------ ------------------ --------------------------------------------------
N/A (xxvi) All Properties Most of the loan documents provide that
transfers of direct and/or indirect interest in
Due-on-Sale the related mortgagor and/or the related
mortgaged property upon the death of any
natural person which holds such interest(s) will
not constitute a transfer of direct and/or
indirect interest in mortgagor and/or mortgaged
property so long as, among other things as set
forth in loan documents: (i) all of the direct
and/or indirect interests of such decedent in
the mortgagor and/or the mortgaged property are
held and remain the property of the legal
representative of such decedent's estate; (ii)
the mortgaged property continues to be managed
in a manner acceptable to the mortgagee and
(iii) within thirty (30) days of such death,
mortgagor delivers notice thereof to the
mortgagee and thereafter provides the mortgagee
with such information as may be reasonably
requested by the mortgagee as to the continued
management of the mortgaged property.
-------------- ------------------------ ------------------ --------------------------------------------------
10 (xxxi) Green Valley A set-back violation exists with respect to one
Portfolio pad at the Findlay, Ohio property.
Qualifications;
Licensing; Zoning
-------------- ------------------------ ------------------ --------------------------------------------------
31 (xxxi) NBSC Building The certificate of occupancy could not be
located but, according to information from the
Qualifications; municipality, a certificate of occupancy was
Licensing; Zoning issued.
-------------- ------------------------ ------------------ --------------------------------------------------
36 (xxxi) Glenlake The certificates of occupancy could not be
Professional located. A new certificate of occupancy was
Qualifications; Offices issued at closing for the improvements completed
Licensing; Zoning as of the closing date. The mortgage loan is
recourse to the borrower for any loss, cost or
damage due to the absence of a certificate of
occupancy.
-------------------------------------------------------------------------------------------------------------
-11-
-------------------------------------------------------------------------------------------------------------
CONTROL NO. REPRESENTATION PROPERTY ISSUE
-------------- ------------------------ ------------------ --------------------------------------------------
-------------- ------------------------ ------------------ --------------------------------------------------
69 (xxxi) Pinewood Estates Ten mobile homes encroach on setbacks and are
considered non-conforming. Income from these
Qualifications; mobile homes was not taken into consideration in
Licensing; Zoning connection with the underwriting of the mortgage
loan due to the underwritten vacancy factor and, in
the event the municipality requires removal of such
mobile homes, the survey indicates adequate room
for the addition of an additional ten pads that
will comply with the current zoning ordinance.
-------------- ------------------------ ------------------ --------------------------------------------------
86 (xxxi) Manhattan Place Certificates of occupancy could not be located.
The mortgage loan is recourse to a principal of
Qualifications; the Borrower for any loss, cost or damage due to
Licensing; Zoning the absence of a certificate of occupancy.
-------------- ------------------------ ------------------ --------------------------------------------------
80, 92 (xxxi) Walgreens-Crest The borrower is not qualified to do business in
Hill the state in which the property is located. The
Qualifications; borrower is required to obtain such
Licensing; Zoning CVS-Waynesville qualification within the time frame set forth in
the loan documents, if applicable.
-------------- ------------------------ ------------------ --------------------------------------------------
24 (xxxi) 1300 Spring Certain tenant certificates of occupancy could
Street not be located. The mortgage loan is recourse
Qualifications; to a principal of the Borrower for any loss,
Licensing; Zoning cost or damage due to the absence of a
certificate of occupancy.
-------------- ------------------------ ------------------ --------------------------------------------------
116 (xxxi) Franklin and With respect to Franklin Street Center,
Halsted Portfolio certificates of occupancy could not be located.
Qualifications; With respect to Walgreens 10620 South Halsted
Licensing; Zoning Street, according to information provided to the
lender, no certificate of occupancy is required
because the property was constructed before 1992
and a new certificate of occupancy is only required
post-1992 if work is performed under a single
building
-------------------------------------------------------------------------------------------------------------
-12-
-------------------------------------------------------------------------------------------------------------
CONTROL NO. REPRESENTATION PROPERTY ISSUE
-------------- ------------------------ ------------------ --------------------------------------------------
permit for a cost of more than $400,000. The
Borrower has represented that no such work was
performed. In each case, the mortgage loan is
recourse to a principal of the Borrower for any
loss, cost or damage due to the absence of a
certificate of occupancy.
-------------- ------------------------ ------------------ --------------------------------------------------
122 (xxxi) Ronkonkoma Blue With respect to Central Xxxxxx, according to
Island & Central information provided to the lender, no
Qualifications; Portfolio certificate of occupancy is required because the
Licensing; Zoning property was constructed before 1992 and a new
certificate of occupancy is only required post-1992
if work is performed under a single building permit
for a cost of more than $400,000. The Borrower has
represented that no such work was performed. The
mortgage loan is recourse to a principal of the
Borrower for any loss, cost or damage due to the
absence of a certificate of occupancy.
-------------- ------------------------ ------------------ --------------------------------------------------
79 (xxxi) Nukoa Plaza One of the tenants required to have a
certificate of occupancy has not obtained same.
Qualifications; The borrower has covenanted to cause such tenant
Licensing; Zoning to obtain such certificate of occupancy.
-------------- ------------------------ ------------------ --------------------------------------------------
125 (xxxi) Witchita & With respect to Anaheim Portfolio, certificates
Anaheim Portfolio of occupancy could not be located. The mortgage
Qualifications; loan is recourse to a principal of the Borrower
Licensing; Zoning for any loss, cost or damage due to the absence
of a certificate of occupancy.
-------------- ------------------------ ------------------ --------------------------------------------------
144 (xxxi) Interstate & With respect to Oakton Street, certificates of
Oakton Portfolio occupancy could not be located. With respect to
Qualifications; Xxxxxxxx Road, according to information provided
Licensing; Zoning to the lender, no certificate of occupancy is
required because the property was constructed
before 1992 and a new certificate of occupancy is
only required post-1992 if
-------------------------------------------------------------------------------------------------------------
-13-
-------------------------------------------------------------------------------------------------------------
CONTROL NO. REPRESENTATION PROPERTY ISSUE
-------------- ------------------------ ------------------ --------------------------------------------------
work is performed under a single building permit
for a cost of more than $400,000. The Borrower has
represented that no such work was performed. In
each case, the mortgage loan is recourse to a
principal of the Borrower for any loss, cost or
damage due to the absence of a certificate of
occupancy.
-------------- ------------------------ ------------------ --------------------------------------------------
N/A (xxxiii) All Properties Certain borrowers, including the borrowers with
respect to two of the Green Valley Portfolio
Single Purpose Entity properties, the 0000 Xxxxxx Xxxxxx property, the
Rossford Hills Apartments property, the Countryview
MHC property, the Virginia Commons property and the
River Ridge Apartments property, may be recycled
entities.
-------------------------------------------------------------------------------------------------------------
-14-
-------------------------------------------------------------------------------------------------------------
CONTROL NO. REPRESENTATION PROPERTY ISSUE
-------------- ------------------------ ------------------ --------------------------------------------------
32 (xxxix) Countryview MHC There is no flood insurance for improvements, as
the improvements are not owned by the borrower.
Flood Hazard Insurance The mortgage loan is recourse to the borrower in an
amount equal to the proceeds which would have been
available to the borrower if the borrower had
carried business interruption insurance with
respect to floods.
-------------- ------------------------ ------------------ --------------------------------------------------
10 (xlii) Green Valley A set-back violation exists with respect to one
Portfolio pad at the Findlay, Ohio property.
Licenses, Permits and
Authorizations
-------------- ------------------------ ------------------ --------------------------------------------------
31 (xlii) NBSC Building The certificate of occupancy could not be
located but, according to information from the
Licenses, Permits and municipality, a certificate of occupancy was
Authorizations issued.
-------------- ------------------------ ------------------ --------------------------------------------------
36 (xlii) Glenlake The certificates of occupancy could not be
Professional located. A new certificate of occupancy was
Licenses, Permits and Offices issued at closing for the improvements completed
Authorizations as of the closing date. The mortgage loan is
recourse to the borrower for any loss, cost or
damage due to the absence of a certificate of
occupancy.
-------------- ------------------------ ------------------ --------------------------------------------------
69 (xlii) Pinewood Estates Ten mobile homes encroach on setbacks and are
considered non-conforming. Income from these
Licenses, Permits and mobile homes was not taken into consideration in
Authorizations connection with the underwriting of the mortgage
loan due to the underwritten vacancy factor and, in
the event the municipality requires removal of such
mobile homes, the survey indicates adequate room
for the addition of an additional ten pads that
will comply with the current zoning ordinance.
-------------------------------------------------------------------------------------------------------------
-15-
-------------------------------------------------------------------------------------------------------------
CONTROL NO. REPRESENTATION PROPERTY ISSUE
-------------- ------------------------ ------------------ --------------------------------------------------
86 (xlii) Manhattan Place Certificates of occupancy could not be located.
The mortgage loan is recourse to a principal of
Licenses, Permits and the Borrower for any loss, cost or damage due to
Authorizations the absence of a certificate of occupancy.
-------------- ------------------------ ------------------ --------------------------------------------------
80, 92 (xlii) Walgreens-Crest The borrower is not qualified to do business in
Hill the state in which the property is located. The
Licenses, Permits and borrower is required to obtain such
Authorizations CVS-Waynesville qualification within the time frame set forth in
the loan documents, if applicable.
-------------- ------------------------ ------------------ --------------------------------------------------
24 (xlii) 1300 Spring Certain tenant certificates of occupancy could
Street not be located. The mortgage loan is recourse
Licenses, Permits and to a principal of the Borrower for any loss,
Authorizations cost or damage due to the absence of a
certificate of occupancy.
-------------- ------------------------ ------------------ --------------------------------------------------
116 (xlii) Franklin and With respect to Franklin Street Center,
Halsted Portfolio certificates of occupancy could not be located.
Licenses, Permits and With respect to Walgreens 10620 South Halsted
Authorizations Street, according to information provided to the
lender, no certificate of occupancy is required
because the property was constructed before 1992
and a new certificate of occupancy is only required
post-1992 if work is performed under a single
building permit for a cost of more than $400,000.
The Borrower has represented that no such work was
performed. In each case, the mortgage loan is
recourse to a principal of the Borrower for any
loss, cost or damage due to the absence of a
certificate of occupancy.
-------------- ------------------------ ------------------ --------------------------------------------------
122 (xlii) Ronkonkoma Blue With respect to Central Xxxxxx, according to
Island & Central information provided to the lender, no
Licenses, Permits and Portfolio certificate of occupancy is required because the
Authorizations property was constructed before 1992 and a new
certificate of occupancy is only required
-------------------------------------------------------------------------------------------------------------
-16-
-------------------------------------------------------------------------------------------------------------
CONTROL NO. REPRESENTATION PROPERTY ISSUE
-------------- ------------------------ ------------------ --------------------------------------------------
post-1992 if work is performed under a single
building permit for a cost of more than $400,000.
The Borrower has represented that no such work was
performed. The mortgage loan is recourse to a
principal of the Borrower for any loss, cost or
damage due to the absence of a certificate of
occupancy.
-------------- ------------------------ ------------------ --------------------------------------------------
79 (xlii) Nukoa Plaza One of the tenants required to have a
certificate of occupancy has not obtained same.
Licenses, Permits and The borrower has covenanted to cause such tenant
Authorizations to obtain such certificate of occupancy.
-------------- ------------------------ ------------------ --------------------------------------------------
125 (xlii) Witchita & With respect to Anaheim Portfolio, certificates
Anaheim Portfolio of occupancy could not be located. The mortgage
Licenses, Permits and loan is recourse to a principal of the Borrower
Authorizations for any loss, cost or damage due to the absence
of a certificate of occupancy.
-------------- ------------------------ ------------------ --------------------------------------------------
144 (xlii) Interstate & With respect to Oakton Street, certificates of
Oakton Portfolio occupancy could not be located. With respect to
Licenses, Permits and Xxxxxxxx Road, according to information provided
Authorizations to the lender, no certificate of occupancy is
required because the property was constructed
before 1992 and a new certificate of occupancy is
only required post-1992 if work is performed under
a single building permit for a cost of more than
$400,000. The Borrower has represented that no such
work was performed. In each case, the mortgage loan
is recourse to a principal of the Borrower for any
loss, cost or damage due to the absence of a
certificate of occupancy.
-------------- ------------------------ ------------------ --------------------------------------------------
10 (xlvii) Green Valley The Birchwood Manor property and the Country
Portfolio Estates Mobile Home Park properties obtain their
Tax Lot; Utilities water supply from xxxxx.
-------------------------------------------------------------------------------------------------------------
-17-
-------------------------------------------------------------------------------------------------------------
CONTROL NO. REPRESENTATION PROPERTY ISSUE
-------------- ------------------------ ------------------ --------------------------------------------------
69 (xlvii) Pinewood Estates The mortgaged property obtains its water supply
from two xxxxx and has access to a third well.
Tax Lot; Utilities
-------------- ------------------------ ------------------ --------------------------------------------------
80 (xlvii) Walgreens-Crest The Mortgaged Property lies in a tax lot that
Hill includes land other than the Mortgaged
Tax Lot; Utilities Property. According to information from the
borrower, the assessor will split-out the
Mortgaged Property as a separate tax lot for the
2006 tax year and subsequent years. Tenant pays
real estate taxes. At the closing of the loan,
the title company collected the balance of the
tax payment currently due on the entire tax
lot. Additionally the borrower has covenanted
to separate the tax parcels and the loan is
recourse to the borrower for any taxes on any
other parcel included in the tax xxxx that is
not a part of the collateral.
-------------- ------------------------ ------------------ --------------------------------------------------
137 (xlvii) Tift Crossing & The tax lot includes land other than the
Tift Pavilion Mortgaged Property. According to information
Tax Lot; Utilities from the borrower, the borrower has recorded the
necessary deeds to separate the tax parcels and a
separate tax lot endorsement to the title insurance
policy was obtained.
-------------- ------------------------ ------------------ --------------------------------------------------
143 (xlvii) IHOP-Nashville The original tax lot included land other than
the Mortgaged Property. According to information
Tax Lot; Utilities from the borrower, the borrower has separated the
tax parcels and the assessor will split-out the
Mortgaged Property as a separate tax lot for the
2006 tax year and subsequent years.
-------------- ------------------------ ------------------ --------------------------------------------------
63 (xlviii) Rite Aid-Church The mortgage loan may currently be defeased. A
Street loan REMIC will be created with respect to this
Defeasance mortgage loan and the Mortgage Loan Seller will be
required to repurchase the mortgage loan upon a
-------------------------------------------------------------------------------------------------------------
-18-
-------------------------------------------------------------------------------------------------------------
CONTROL NO. REPRESENTATION PROPERTY ISSUE
-------------- ------------------------ ------------------ --------------------------------------------------
defeasance prior to the second anniversary of the
Closing Date.
-------------- ------------------------ ------------------ --------------------------------------------------
13 and others (xlviii) Certain The defeasance collateral can consist of, in
Properties addition to what is listed in representation
Defeasance including 888 (xlviii), non-callable instruments, which (a)
Seventh Avenue will not cause the REMIC trust to fail to maintain
its status as a "real estate mortgage investment
conduit," (b) will not result in a ratings
reduction, downgrade or withdrawal, (c) are then
outstanding and (d) are then being generally
accepted by the rating agencies without any
reduction, downgrade or withdrawal of the
applicable ratings.
-------------- ------------------------ ------------------ --------------------------------------------------
63 (li) Rite Aid-Church The Due Date is the fifth day of each month.
Street
Due Date
-------------- ------------------------ ------------------ --------------------------------------------------
40, 48, 58, (liv) CVS-Waynesville The mortgagor is an affiliate of the lender.
62, 68, 70,
76, 77, 80, No Ownership Interest Walgreens-Antioch
83, 89, 92 in Mortgagor
Walgreens-Crest
Hill
CVS-Xxxxxxx
Walgreens-Saraland
Walgreens-Decatur
Walgreens-Roselle
0000 Xxxxxxxxxxx
Xxxx
00 Xxxxx Xxxxx
0000 Xxxxx Xxxxx
000 Xxxxxxxx
Xxxxx
000 Xxxxxxxx Xxxx
-------------------------------------------------------------------------------------------------------------
-19-
-------------------------------------------------------------------------------------------------------------
CONTROL NO. REPRESENTATION PROPERTY ISSUE
-------------- ------------------------ ------------------ --------------------------------------------------
40, 48, 58, (lv) CVS-Waynesville Seller owns indirect interests in the borrowers
62, 68, 70, with respect to these mortgage loans.
76, 77, 80, No Undisclosed Common Walgreens-Antioch
83, 89, 00 Xxxxxxxxx
Xxxxxxxxx-Xxxxx
Xxxx
XXX-Xxxxxxx
Xxxxxxxxx-Xxxxxxxx
Walgreens-Decatur
Walgreens-Roselle
0000 Xxxxxxxxxxx
Xxxx
00 Xxxxx Xxxxx
0000 Xxxxx Xxxxx
000 Xxxxxxxx
Xxxxx
000 Xxxxxxxx Xxxx
-------------------------------------------------------------------------------------------------------------
-20-
Sch I-1
EXHIBIT C
NONE
Exh C-1
EXHIBIT C-1
OPINION OF CADWALADER, XXXXXXXXXX & XXXX LLP
[LETTERHEARD OF CADWALADER, XXXXXXXXXX & XXXX LLP]
June 29, 2006
Addressees listed on Schedule A
Re: LB-UBS Commercial Mortgage Trust 2006-C4, Commercial Mortgage Pass-Through
Certificates, Series 2006-C4
Ladies and Gentlemen:
We are rendering this opinion pursuant to the Mortgage Loan Purchase
Agreement, dated as of June 20, 2006 (the "MLPA"), between UBS Real Estate
Investments Inc., as seller (the "Seller") and Structured Asset Securities
Corporation II, as purchaser ("SASC").
We have acted as special counsel to the Seller in connection with the
following transactions: (i) the sale by the Seller, and the purchase by SASC, of
multifamily and commercial mortgage loans in the principal amount of
approximately $352,583,006 (the "UBS Mortgage Loans"), pursuant to the MLPA;
(ii) the execution by the Seller of the UBS Indemnification Agreement, dated as
of June 12, 2006 (the "Indemnification Agreement"), by and among the Seller,
SASC and the Underwriters (as defined below); and (iii) the acknowledgement by
the Seller of certain sections of the Underwriting Agreement, dated as of June
12, 2006 (the "Underwriting Agreement"), by and among SASC, UBS Securities and
Xxxxxx, and acknowledged with respect to certain sections by the Seller and
LBHI.
The MLPA, the Indemnification Agreement and the Underwriting Agreement
are collectively referred to herein as the "Agreements." Capitalized terms not
defined herein have the respective meanings set forth in the MLPA.
In rendering the opinions set forth below, we have examined and, as to
factual matters relevant to the opinions set forth below, relied upon the
originals, copies or specimens, certified or otherwise identified to our
satisfaction, of the Agreements and such certificates, corporate and public
records, agreements, instruments and other documents, including, among other
things, the documents and agreements delivered at the closing of the purchase
and sale of the Certificates (the "Closing"), as we have deemed appropriate as a
basis for the opinions expressed below. In such examination we have assumed the
genuineness of all signatures, the authenticity of all documents, agreements and
instruments submitted to us as originals, the conformity to original documents,
agreements and instruments of all documents, agreements and instruments
submitted to us as copies or specimens, the authenticity of the originals of
such documents, agreements and instruments submitted to us as copies or
specimens and the accuracy
of the matters set forth in the documents, agreements and instruments we
reviewed. As to any facts material to the opinions expressed below that were not
known to us, we have relied upon statements, certificates and representations of
officers and other representatives of the Seller, SASC and the Underwriters,
including those contained in the Agreements and other documents, certificates,
agreements and opinions delivered at the Closing, and of public officials. In
addition, with respect to the opinions referred to in paragraphs 8(c), 8(d) and
9 below, such opinions are based solely on the Seller Officer's Certificate
referred to below, a review of the items, if any, identified as exceptions in
the exhibits to such certificates, conversation with internal counsel for the
Seller, and the actual knowledge of attorneys who conducted such review, had
such conversations and/or customarily represent the Seller in real estate
lending transactions, financing transactions, and/or transactions similar to
those contemplated by the Agreements. Except as expressly set forth herein, we
have not undertaken any independent investigation (including, without
limitation, conducting any review, search or investigation of any public files,
records or dockets) to determine the existence or absence of the facts that are
material to our opinion, and no inference as to our knowledge concerning such
facts should be drawn from our reliance on the representations of the Seller and
others in connection with the preparation and delivery of this letter.
In particular, we have examined and relied upon:
(i) the MLPA;
(ii) the Underwriting Agreement;
(iii) the Indemnification Agreement; and
(iv) the officer's certificate of Seller, dated the date hereof (the
"Seller Officer's Certificate").
References in this letter to "Applicable Laws" shall mean those laws,
rules and regulations of the State of New York and of the United States of
America which, in our experience, are normally applicable to transactions of the
type contemplated by the Agreements, as well as the General Corporation Law of
the State of Delaware with respect to the opinions referred to in paragraphs 1,
2, 4(a), 4(b)(i), 4(c) and 4(d) below. While we are not licensed to practice law
in the State of Delaware, we have reviewed applicable provisions of the Delaware
General Corporation Law as we have deemed appropriate in connection with the
opinions expressed herein. Except as described we have neither examined nor do
we express any opinion with respect to Delaware law. References in this letter
to the term "Governmental Authorities" means executive, legislative, judicial,
administrative or regulatory bodies of the State of New York or the United
States of America. References in this letter to the term "Governmental Approval"
means any consent, approval, license, authorization or validation of, or filing,
recording or registration with, any Governmental Authority pursuant to
Applicable Laws.
We have also assumed, except as to the Seller, that all documents,
agreements and instruments have been duly authorized, executed and delivered by
all parties thereto, that all such parties are validly existing and in good
standing under the laws of their respective jurisdictions of organization, that
all such parties had the power and legal right to execute and deliver all such
-3-
documents, agreements and instruments, and, except as to the Seller, that such
documents, agreements and instruments are legal, valid and binding obligations
of such parties, enforceable against such parties in accordance with their
respective terms. As used herein, "to our knowledge," "known to us" or words of
similar import mean the actual knowledge, without independent investigation
(except as expressly set forth herein), of any lawyer in our firm actively
involved in the transactions contemplated by the Agreements.
We express no opinion concerning any law other than Applicable Law.
Based upon and subject to the foregoing, we are of the opinion that:
1. Each of the Agreements has been duly authorized, executed and
delivered by the Seller.
2. The Seller is a corporation validly existing and in good standing
under the laws of the State of Delaware, with corporate power and authority
to enter into and perform its obligations under the Agreements.
3. Each of the MLPA and the Underwriting Agreement constitutes the
legal, valid and binding agreement of the Seller, enforceable against the
Seller in accordance with its terms, subject to applicable bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium, receivership
or other laws relating to or affecting creditors' rights generally, and to
general principles of equity (regardless of whether enforcement is sought
in a proceeding at law or in equity), and except that (a) the enforcement
of rights with respect to indemnification and contribution obligations and
(b) provisions (i) purporting to waive or limit rights to trial by jury,
oral amendments to written agreements or rights of set off or (ii) relating
to submission to jurisdiction, venue or service of process, may be limited
by applicable law or considerations of public policy.
4. None of the sale of the UBS Mortgage Loans, the consummation by the
Seller of any of the other transactions contemplated by the Agreements to
which it is a party or the execution, delivery and performance by the
Seller of the terms of the Agreements to which it is a party, (a) will
require any Governmental Approval to be obtained or made on the part of the
Seller, the absence of which would have a material adverse effect on the
Seller or the transactions contemplated by the Agreements, except those
that may be required under state securities or blue sky laws, and except
for such other approvals that have been obtained and, to our knowledge, are
in full force and effect, (b) will conflict with, or result in a violation
of, any provision of (i) either the Seller's certificate of incorporation
or bylaws or (ii) any Applicable Laws applicable to the Seller, (c) will,
to our knowledge, breach, constitute a default under, require any consent
under, or result in the acceleration or require prepayment of any
indebtedness pursuant to the terms of, any agreement or instrument to which
the Seller is a party or by which it is bound or to which it is subject, or
result in the creation or imposition of any lien upon any property of the
Seller pursuant to the terms of any such agreement or instrument, any of
which occurrences, either in any one instance or in the aggregate, would
call into question the validity of any Agreement to which it is a party or
be reasonably likely to impair materially the ability of the Seller to
perform under the terms
-4-
of any Agreement to which it is a party or (d) will, to our knowledge,
breach or result in a violation of, or default under, any material
judgment, decree or order that is applicable to the Seller and is issued by
any Governmental Authority having jurisdiction over the Seller or any of
its properties.
5. To our actual knowledge, there is no legal or governmental action,
investigation or proceeding pending or threatened against the Seller (a)
asserting the invalidity of the Agreements to which it is a party, (b)
seeking to prevent the consummation of any of the transactions provided for
in the Agreements, or (c) that would materially and adversely affect (i)
the ability of the Seller to perform its obligations under, or the validity
or enforceability (with respect to the Seller) of, the Agreements to which
it is a party or (ii) any rights with regard the Mortgaged Properties or
the Mortgage Loans. For purposes of the opinion set forth in this
paragraph, we have not regarded any legal or governmental actions,
investigations or proceedings to be "threatened" unless the potential
litigant or governmental authority has communicated in writing to the
Seller a present intention to initiate such actions, investigations or
proceedings against the Seller.
We are furnishing this letter to you solely for your benefit in
connection with the transactions referred to herein. Without our prior written
consent, this letter is not to be relied upon, used, circulated, quoted or
otherwise referred to by, or assigned to, any other person (including any person
that acquires any Certificates from you or that seeks to assert your rights in
respect of this letter (other than your successor in interest by means of
merger, consolidation, transfer of a business or other similar transaction)) or
for any other purpose. In addition, we disclaim any obligation to update this
letter for changes in fact or law, or otherwise.
Very truly yours,
-5-
SCHEDULE A
Structured Asset Securities Corporation II
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxx Brothers Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
UBS Securities LLC
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Standard & Poor's Rating Services
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
LaSalle Bank National Association
000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Xxxxx'x Investors Service, Inc.
00 Xxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Exh X-0-0
XXXXXXX X
XXXX
Xxx X-0
