EXECUTION COPY
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.,
Depositor,
GMAC COMMERCIAL MORTGAGE CORPORATION,
Master Servicer,
GMAC COMMERCIAL MORTGAGE CORPORATION,
Special Servicer,
and
LASALLE BANK NATIONAL ASSOCIATION
Trustee
and
ABN AMRO BANK N.V.,
Fiscal Agent
-------------------------------------------
POOLING AND SERVICING AGREEMENT
Dated as of June 1, 1999
------------------------------------------
$974,502,236
Mortgage Pass-Through Certificates
Series 1999-C2
This Pooling and Servicing Agreement (this "Agreement"), is dated and
effective as of June 1, 1999, among GMAC COMMERCIAL MORTGAGE SECURITIES, INC.,
as Depositor, GMAC COMMERCIAL MORTGAGE CORPORATION, as Master Servicer, GMAC
COMMERCIAL MORTGAGE CORPORATION, as Special Servicer, and LASALLE BANK NATIONAL
ASSOCIATION, as Trustee and ABN AMRO BANK N.V., as Fiscal Agent.
PRELIMINARY STATEMENT:
The Depositor intends to sell the Certificates, to be issued hereunder in
multiple Classes, which in the aggregate will evidence the entire beneficial
ownership interest in the Trust Fund to be created hereunder, the primary assets
of which will be the Mortgage Loans. The aggregate of the initial Cut-off Date
Principal Balances of the Mortgage Loans is approximately $974,502,236.
As provided herein, the Trustee will elect to treat the segregated pool of
assets consisting of the Mortgage Loans (exclusive of that portion of interest
payments thereon that constitute Excess Interest) and certain other related
assets subject to this Agreement as a REMIC for federal income tax purposes, and
such segregated pool of assets will be designated as "REMIC I". The Class R-I
Certificates will represent the sole class of "residual interests" in REMIC I
for purposes of the REMIC Provisions under federal income tax law. With respect
to each Mortgage Loan, there shall be a corresponding REMIC I Regular Interest.
The designation for each such REMIC I Regular Interest shall be the loan number
for the related Mortgage Loan set forth on the schedule of Mortgage Loans
attached hereto as Schedule I. The REMIC I Remittance Rate (as defined herein)
and the initial Uncertificated Principal Balance of each such REMIC I Regular
Interest shall be based on the Net Mortgage Rate as of the Cut-off Date and the
Cut-off Date Principal Balance, respectively, for the related Mortgage Loan.
Determined solely for purposes of satisfying Treasury Regulation Section
1.860G-1(a)(4)(iii), the "latest possible maturity date" for each such REMIC I
Regular Interest shall be the first Distribution Date that follows the Stated
Maturity Date for the related Mortgage Loan. None of the REMIC I Regular
Interests will be certificated.
As provided herein, the Trustee will elect to treat the segregated pool of
assets consisting of the REMIC I Regular Interests as a REMIC for federal income
tax purposes, and such segregated pool of assets will be designated as "REMIC
II." The Class R-II Certificates will represent the sole class of "residual
interests" in REMIC II for purposes of the REMIC Provisions under federal income
tax law. The following table irrevocably sets forth the designation, REMIC II
Remittance Rate and the initial Uncertificated Principal Balance for each of the
REMIC II Regular Interests. Determined solely for purposes of satisfying
Treasury Regulation Section 1.860G-1(a)(4)(iii), the "latest possible maturity
date" for each REMIC II Regular Interest shall be the first Distribution Date
that is at least two years after the end of the remaining amortization schedule
of the Mortgage Loan that has, as of the Closing Date, the longest remaining
amortization schedule, irrespective of its scheduled maturity. None of the REMIC
II Regular Interests will be certificated.
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REMIC II Initial Uncertificated
Designation Remittance Rate Principal Balance
----------- --------------- -----------------
LA-1......................... Variable (*) $150,250,000
LA-2......................... Variable (*) $548,955,000
LB........................... Variable (*) $51,161,000
LC........................... Variable (*) $48,725,000
LD........................... Variable (*) $14,618,000
LE........................... Variable (*) $41,416,000
LF........................... Variable (*) $12,181,000
LG........................... Variable (*) $12,182,000
LH........................... Variable (*) $46,289,000
LJ........................... Variable (*) $7,308,000
LK........................... Variable (*) $19,490,000
LL........................... Variable (*) $7,309,000
LM........................... Variable (*) $4,873,000
LN........................... Variable (*) $9,745,236
* Calculated in accordance with the definition of "REMIC II Remittance Rate."
As provided herein, the Trustee will elect to treat the segregated pool of
assets consisting of the REMIC II Regular Interests as a REMIC for federal
income tax purposes, and such segregated pool of assets will be designated as
"REMIC III". The Class R-III Certificates will represent the sole class of
"residual interests" in REMIC III for purposes of the REMIC Provisions under
federal income tax law. The following table irrevocably sets forth the
designation, the Pass-Through Rate and initial Class Principal Balance for each
of the Classes of REMIC III Regular Certificates. Determined solely for purposes
of satisfying Treasury Regulation Section 1.860G-1(a)(4)(iii), the "latest
possible maturity date" for each Class of REMIC III Regular Certificates shall
be the first Distribution Date that is at least two years after the end of the
remaining amortization schedule of the Mortgage Loan that has, as of the Closing
Date, the longest remaining amortization schedule, irrespective of its scheduled
maturity.
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Certificate Initial Class
Designation Pass-Through Rate Principal Balance
----------- ----------------- -----------------
Class X........................ N/A(1) N/A(2)
Class A-1...................... 6.5700% $150,250,000
Class A-2...................... 6.9450%(3) $548,955,000
Class B........................ 7.1400%(3) $51,161,000
Class C........................ 7.2400%(3) $48,725,000
Class D........................ 7.375%(3) $14,618,000
Class E........................ 7.3116%(4) $41,416,000
Class F........................ 7.3116%(4) $12,181,000
Class G........................ 7.3116%(4) $12,182,000
Class H........................ 6.4810%(3) $46,289,000
Class J........................ 6.4810%(3) $7,308,000
Class K........................ 6.4810%(3) $19,490,000
Class L........................ 6.4810%(3) $7,309,000
Class M........................ 6.4810%(3) $4,873,000
Class N........................ 6.4810%(3) $9,745,236
(1) The Pass-Through Rate for the Class X Certificates as described
herein.
(2) The Class X Certificate will have an original Notional Amount of
$974,502,236. The Class X Certificates will not have a Certificate
Principal Balance and will not be entitled to any distribution of
certificate principal.
(3) Lesser of the indicated Fixed Rate or the Weighted Average Net
Mortgage Rate.
(4) Initial Pass-Through Rate. The Pass-Through Rate will be the Weighted
Average Net Mortgage Rate.
As provided herein, the Trustee shall take all actions necessary to ensure
that the portion of the Trust Fund consisting of the Grantor Trust Assets
maintains its status as a "grantor trust" under federal income tax law and not
be treated as part of REMIC I, REMIC II or REMIC III.
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Capitalized terms used in this Preliminary Statement are defined in Article
I hereof.
In consideration of the mutual agreements herein contained, the Depositor,
the Master Servicer, the Special Servicer, the Trustee and the Fiscal Agent
agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01 Defined Terms.
Whenever used in this Agreement, including in the Preliminary Statement,
the following words and phrases, unless the context otherwise requires, shall
have the meanings specified in this Article.
"Accrued Certificate Interest": With respect to any Class of REMIC III
Regular Certificates for any Distribution Date, one month's interest (calculated
on the basis of a 360-day year consisting of twelve 30-day months) at the
Pass-Through Rate applicable to such Class of Certificates for such Distribution
Date, accrued on the Class Principal Balance or Class Notional Amount, as the
case may be, of such Class of Certificates outstanding immediately prior to such
Distribution Date. The Accrued Certificate Interest in respect of any Class of
REMIC III Regular Certificates for any Distribution Date shall be deemed to have
accrued during the applicable Interest Accrual Period.
"Acquisition Date": With respect to any REO Property, the first day on
which such REO Property is considered to be acquired by the Trust Fund within
the meaning of Treasury Regulation Section 1.856-6(b)(1), which is the first day
on which the Trust Fund is treated as the owner of such REO Property for federal
income tax purposes.
"Additional Information": As defined in Section 4.02(a).
"Additional Trust Fund Expense": Any unanticipated expense within the
meaning of Treasury Regulation Section 1.860G-1(b)(3)(iii) experienced with
respect to the Trust Fund and not otherwise included in the calculation of a
Realized Loss, that would result in the REMIC III Regular Certificateholders'
receiving less than the full amount of principal and/or interest to which they
are entitled on any Distribution Date.
"Adjustable Rate Mortgage Loan": A Mortgage Loan as to which the related
Mortgage Note provides, as of the Closing Date, for periodic adjustments to the
Mortgage Rate thereon based on changes in the related Index.
"Advance": Any Delinquency Advance or Servicing Advance.
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"Advance Interest": Interest accrued on any Advance at the Reimbursement
Rate and payable to the Master Servicer, the Special Servicer, the Trustee or
the Fiscal Agent, as the case may be, all in accordance with Section 3.11(f) or
Section 4.03(d), as applicable.
"Adverse Grantor Trust Event": As defined in Section 10.03(e).
"Adverse REMIC Event": As defined in Section 10.01(f).
"Affiliate": With respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" when used with respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"Agreement": This Pooling and Servicing Agreement and all amendments hereof
and supplements hereto.
"Anticipated Repayment Date": With respect to any ARD Loan, the date upon
which such ARD Loan starts to accrue interest at its Revised Rate.
"Applicable State Law": For purposes of Article X, the Applicable State Law
shall be (a) the laws of the State and City of New York, (b) the laws of the
states in which the Corporate Trust Office of the Trustee and the Primary
Servicing Offices of the Master Servicer and the Special Servicer are located,
(c) other state or local law as to which the Trustee as the REMIC administrator
has actual knowledge of applicability and (d) such other state or local law
whose applicability shall have been brought to the attention of the Trustee as
REMIC administrator by either (i) an opinion of counsel delivered to it, or (ii)
written notice from the appropriate taxing authority as to the applicability of
such state law.
"Appraisal": With respect to any Mortgaged Property or REO Property as to
which an appraisal is required or permitted to be performed pursuant to the
terms of this Agreement, either: (i) a narrative appraisal complying with USPAP
conducted by a Qualified Appraiser in the case of Mortgage Loans and REO Loans
with a Stated Principal Balance as of the date of such appraisal of greater than
$1,000,000; or (ii) a limited appraisal and a summary report of the "market
value" of the Mortgaged Property conducted by a Qualified Appraiser in the case
of Mortgage Loans and REO Loans with a Stated Principal Balance as of the date
of such appraisal of $1,000,000 or less.
"Appraisal Reduction Amount": With respect to any Required Appraisal Loan,
an amount (as calculated on the Determination Date immediately succeeding the
date on which the most recent relevant Appraisal was obtained by the Master
Servicer or the Special Servicer, as the case may be, pursuant to this
Agreement) equal to the excess, if any, of (a) the sum of (i) the Stated
Principal Balance of such Required Appraisal Loan, (ii) to the extent not
previously advanced by or on behalf of the Master Servicer or the Trustee or the
Fiscal Agent, all accrued and unpaid interest
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on such Required Appraisal Loan through the most recent Due Date prior to such
Determination Date at a per annum rate equal to the related Mortgage Rate, (iii)
all related unreimbursed Advances made by or on behalf of the Master Servicer,
the Special Servicer, the Trustee or the Fiscal Agent in respect of such
Required Appraisal Loan, together with all unpaid Advance Interest accrued on
such Advances, and (iv) all currently due but unpaid real estate taxes and
assessments, insurance premiums and, if applicable, ground rents in respect of
the related Mortgaged Property or REO Property, net of any Escrow Payments or
other reserves held by the Master Servicer or the Special Servicer with respect
to any such item, over (b) 90% of an amount equal to (i) the Appraised Value of
the related Mortgaged Property or REO Property, as applicable, as determined by
such Appraisal referred to in the parenthetical above, net of (ii) the amount of
any liens on such property (not accounted for in clause (a)(iv) of this
definition or taken into account in determining such Appraised Value) that are
prior to the lien of the Required Appraisal Loan. Notwithstanding the foregoing,
if an Appraisal is not obtained within 120 days following the earliest of the
dates described in Section 3.19(d) (which, in the case of Section 3.19(d)(ii),
shall be the date of the occurrence of an uncured delinquency in Monthly
Payments), then until such Appraisal is obtained the Appraisal Reduction Amount
will equal 25% of the Stated Principal Balance of the related Required Appraisal
Loan; provided that, upon receipt of an Appraisal, however, the Appraisal
Reduction Amount for such Required Appraisal Loan will be recalculated in
accordance with this definition without regard to this sentence.
"Appraised Value": As of any date of determination, the appraised value of
a Mortgaged Property based upon the most recent Appraisal obtained pursuant to
this Agreement.
"ARD Loan": Any Mortgage Loan that is designated as such in the Mortgage
Loan Schedule.
"Assignment of Leases": With respect to any Mortgaged Property, any
assignment of leases, rents, security deposits and profits or similar instrument
executed by the Mortgagor, assigning to the mortgagee all of the income, rents
and profits derived from the ownership, operation, leasing or disposition of all
or a portion of such Mortgaged Property, in the form which was duly executed,
acknowledged and delivered, as amended, modified, renewed or extended through
the date hereof and from time to time hereafter.
"Assumed Monthly Payment": With respect to any Balloon Mortgage Loan for
its Stated Maturity Date (provided that such Mortgage Loan has not been paid in
full, and no other Liquidation Event has occurred in respect thereof, on or
before the end of the Collection Period in which such Stated Maturity Date
occurs (or in the case of a Late Due Date Mortgage Loan, on or before the end of
the Collection Period immediately preceding the Collection Period in which such
Stated Maturity Date occurs)) and for any subsequent Due Date therefor as of
which such Mortgage Loan remains outstanding and part of the Trust Fund (or, in
the case of a Late Due Date Mortgage Loan, for any subsequent Due Date therefor
which follows in the same month a Determination Date as of which such Mortgage
Loan remains outstanding and part of the Trust Fund), if no Monthly Payment
(other than the related Balloon Payment) is due for such Due Date, the scheduled
monthly payment of principal and/or interest deemed to be due in respect thereof
for the Stated Maturity Date
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and each such subsequent Due Date equal to the Monthly Payment (exclusive of any
Excess Interest) that would have been due in respect of such Mortgage Loan on
such Due Date if it had been required to continue to accrue interest in
accordance with its terms, and to pay principal in accordance with the
amortization schedule (if any), in effect immediately prior to, and without
regard to the occurrence of, its most recent scheduled maturity date. With
respect to any REO Loan, for any Due Date therefor as of which (or, in the case
of a Late Due Date Mortgage Loan, for any Due Date therefor which follows in the
same month a Determination Date as of which) the related REO Property remains
part of the Trust Fund, the scheduled monthly payment of principal and/or
interest deemed to be due in respect thereof on such Due Date equal to the
Monthly Payment (or, in the case of a Balloon Mortgage Loan described in the
preceding sentence of this definition, the Assumed Monthly Payment) exclusive of
any Excess Interest that was due (or deemed due) in respect of the related
Mortgage Loan for the last Due Date prior to its becoming an REO Loan.
"Available Distribution Amount": With respect to any Distribution Date, an
amount equal to (a) the sum of (i) the aggregate amount relating to the Trust
Fund on deposit in the Certificate Account and the Distribution Account as of
the close of business on the related Determination Date, (ii) the aggregate
amount of any Delinquency Advances made by the Master Servicer or Trustee for
such Distribution Date pursuant to Section 4.03, (iii) the aggregate of any
Compensating Interest Payments made by the Master Servicer for such Distribution
Date pursuant to Section 3.19, (iv) in the case of the Final Distribution Date,
the aggregate of any Liquidation Proceeds paid by the Master Servicer or the
Depositor in connection with a purchase of all the Mortgage Loans and any REO
Properties pursuant to Section 9.01, (v) with respect to the Distribution Date
occurring in March of each calendar year, the Withheld Amounts with respect to
the Interest Reserve Loans deposited in the Interest Reserve Account by the
Trustee in January and/or February of such calendar year in accordance with
Section 3.04(c), and (vi) with respect to any Late Due Date Mortgage Loan, the
Monthly Payment (other than any Balloon Payment) due in the same calendar month
as such Distribution Date and received on or before its Due Date, net of (b) the
aggregate portion of the amount described in clause (a) hereof that represents
one or more of the following: (i) Monthly Payments (except those referred to in
clause (a)(vi) above) paid by the Mortgagors that are due on a Due Date
following the end of the related Collection Period, (ii) any amounts payable or
reimbursable to any Person from the Certificate Account pursuant to clauses (ii)
- (xvii), inclusive, of Section 3.05(a), (iii) any amounts payable or
reimbursable to any Person from the Distribution Account pursuant to clauses
(ii) - (vii), inclusive, of Section 3.05(b), (iv) Prepayment Premiums and Excess
Interest, (v) any amounts deposited in the Certificate Account or the
Distribution Account, as the case may be, in error, and (vi) with respect to the
Distribution Date occurring in (A) January of each calendar year that is not a
leap year and (B) February of each calendar year, the Withheld Amounts with
respect to the Interest Reserve Loans deposited in the Interest Reserve Account
by the Trustee with respect to such Distribution Date in accordance with Section
3.04(c). Notwithstanding the investment of funds held in the Certificate Account
or the Distribution Account pursuant to Section 3.06, for purposes of
calculating the Available Distribution Amount, the amounts so invested shall be
deemed to remain on deposit in such account.
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"Balloon Mortgage Loan": Any Mortgage Loan that by its original terms or by
virtue of any modification entered into as of the Closing Date provides for an
amortization schedule extending beyond its Maturity Date.
"Balloon Payment": With respect to any Balloon Mortgage Loan as of any date
of determination, the Monthly Payment payable on the Maturity Date of such
Mortgage Loan.
"Balloon Payment Interest Excess": With respect to any Balloon Mortgage
Loan (other than a Late Due Date Mortgage Loan) as to which the Stated Maturity
Date occurs in the same Collection Period as the prior Due Date for such
Mortgage Loan, and as to which the related Balloon Payment is paid during such
Collection Period after such prior Due Date, the amount of interest (net of
related Servicing Fees and, if applicable, Excess Interest) accrued on such
Mortgage Loan from such prior Due Date to, but not including, the date the
related Balloon Payment is paid, to the extent such interest is actually paid by
the related Mortgagor in connection with the payment of the related Balloon
Payment on or before such Stated Maturity Date.
"Balloon Payment Interest Shortfall": With respect to any Balloon Mortgage
Loan (other than a Late Due Date Mortgage Loan) as to which the Stated Maturity
Date occurs after the Determination Date in any calendar month, and as to which
the related Balloon Payment was made during the Collection Period in which such
Stated Maturity Date occurs, the amount of interest that would have accrued on
such Mortgage Loan at the related Net Mortgage Rate from such Stated Maturity
Date to but not including the date that (but for the occurrence of such Stated
Maturity Date) would otherwise have been the next succeeding scheduled Due Date,
to the extent not paid by the related Mortgagor. With respect to any Late Due
Date Mortgage Loan that is a Balloon Mortgage Loan as to which the related
Balloon Payment is paid during the Collection Period in which the related Stated
Maturity Date occurs, the amount of interest that would have accrued on such
Late Due Date Mortgage Loan at the related Net Mortgage Rate from such Stated
Maturity Date to the date that (but for the occurrence of such Stated Maturity
Date) would have been the Due Date in the next calendar month, to the extent not
paid by the related Mortgagor.
"Bankruptcy Code": The federal Bankruptcy Code, as amended from time to
time (Title 11 of the United States Code).
"Bloomberg": As defined in Section 4.02(a).
"Breach": As defined in Section 2.03(a).
"Book-Entry Certificate": Any Certificate registered in the name of the
Depository or its nominee.
"Business Day": Any day other than a Saturday, a Sunday or a day on which
banking institutions in New York, New York, and the cities in which the Primary
Servicing Offices of the Master Servicer and the Special Servicer and the city
in which the Corporate Trust Office of the Trustee is located, are authorized or
obligated by law or executive order to remain closed.
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"Cash Collateral Account": With respect to any Mortgage Loan that has a
LockBox Account, any account or accounts created pursuant to the related
Mortgage Loan, Cash Collateral Account Agreement or other loan document, into
which account or accounts the LockBox Account monies are swept on a regular
basis for the benefit of the Trustee as successor to the Mortgage Loan Seller's
interest in the Mortgage Loans. Any Cash Collateral Account shall be
beneficially owned for federal income tax purposes by the Person who is entitled
to receive all reinvestment income or gain thereon in accordance with the terms
and provisions of the related Mortgage Loan and Section 3.06, which Person shall
be taxed on all reinvestment income or gain thereon. The Master Servicer shall
be permitted to make withdrawals therefrom solely for deposit into the
Certificate Account. To the extent not inconsistent with the terms of the
related Mortgage Loan, each such Cash Collateral Account shall be an Eligible
Account.
"Cash Collateral Account Agreement": With respect to any Mortgage Loan, the
cash collateral account agreement, if any, between the originator of such
Mortgage Loan and the related Mortgagor, pursuant to which the related Cash
Collateral Account, if any, may have been established.
"CERCLA": The Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended.
"Certificate": Any one of the Depositor's Mortgage Pass-Through
Certificates, Series 1999-C2, as executed by the Trustee and authenticated and
delivered hereunder by the Certificate Registrar.
"Certificate Account": The custodial account or accounts created and
maintained pursuant to Section 3.04(a) in the name of a depository institution,
as custodian for the Holders of the Certificates, for the holders of certain
other interests in mortgage loans serviced or sold by the Master Servicer and
for the Master Servicer, into which the amounts set forth in Section 3.04(a)
shall be deposited directly. Any such account or accounts shall be an Eligible
Account.
"Certificate Factor": With respect to any Class of REMIC III Regular
Certificates, as of any date of determination, a fraction, expressed as a
decimal carried to eight places, the numerator of which is the then related
Class Principal Balance or the Class Notional Amount, as the case may be, and
the denominator of which is the related Initial Class Principal Balance or the
Initial Class Notional Amount, as the case may be.
"Certificateholder" or "Holder": The Person in whose name a Certificate is
registered in the Certificate Register, except that, solely for the purposes of
giving any consent, approval or waiver pursuant to this Agreement, any
Certificate registered in the name of the Master Servicer, the Special Servicer,
the Trustee, the Fiscal Agent, the Depositor or any Affiliate of either shall be
deemed not to be outstanding, and the Voting Rights to which it is entitled
shall not be taken into account in determining whether the requisite percentage
of Voting Rights necessary to effect any such consent, approval or waiver has
been obtained, except as otherwise provided in Sections 7.04 and 11.01. The
Trustee shall be entitled to request and rely upon a certificate of the Master
Servicer,
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the Special Servicer or the Depositor in determining whether a Certificate is
registered in the name of an Affiliate of such Person. All references herein to
"Holders" or "Certificateholders" shall reflect the rights of Certificate Owners
as they may indirectly exercise such rights through the Depository and the
Depository Participants, except as otherwise specified herein; provided,
however, that the parties hereto shall be required to recognize as a "Holder" or
"Certificateholder" only the Person in whose name a Certificate is registered in
the Certificate Register as of the related Record Date.
"Certificate Notional Amount": With respect to any Class X Certificate, as
of any date of determination, the then notional principal amount on which such
Certificate accrues interest equal to the product of (a) the Percentage Interest
evidenced by such Certificate, multiplied by (b) the then Class Notional Amount
of the Class X Certificates.
"Certificate Owner": With respect to a Book-Entry Certificate, the Person
who is the beneficial owner of such Certificate as reflected on the books of the
Depository or on the books of a Depository Participant or on the books of an
indirect participating brokerage firm for which a Depository Participant acts as
agent.
"Certificate Principal Balance": With respect to any Principal Balance
Certificate, as of any date of determination, the then outstanding principal
amount of such Certificate equal to the product of (a) the Percentage Interest
evidenced by such Certificate, multiplied by (b) the then Class Principal
Balance of the Class of Certificates to which such Certificate belongs.
"Certificate Register" and "Certificate Registrar": The register maintained
and registrar appointed pursuant to Section 5.02.
"Class": Collectively, all of the Certificates bearing the same
alphabetical and, if applicable, numerical class designation.
"Class A Certificate": Any one of the Class A-1 or Class A-2 Certificates.
"Class A-1 Certificate": Any one of the Certificates with a "Class A-1"
designation on the face thereof, substantially in the form of Exhibit A-2
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class A-2 Certificate": Any one of the Certificates with a "Class A-2"
designation on the face thereof, substantially in the form of Exhibit A-3
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class B Certificate": Any one of the Certificates with a "Class B"
designation on the face thereof, substantially in the form of Exhibit A-4
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
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"Class C Certificate": Any one of the Certificates with a "Class C"
designation on the face thereof, substantially in the form of Exhibit A-5
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class D Certificate": Any one of the Certificates with a "Class D"
designation on the face thereof, substantially in the form of Exhibit A-6
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class E Certificate": Any one of the Certificates with a "Class E"
designation on the face thereof, substantially in the form of Exhibit A-7
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class F Certificate": Any one of the Certificates with a "Class F"
designation on the face thereof, substantially in the form of Exhibit A-8
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class G Certificate": Any one of the Certificates with a "Class G"
designation on the face thereof, substantially in the form of Exhibit A-9
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class H Certificate": Any one of the Certificates with a "Class H"
designation on the face thereof, substantially in the form of Exhibit A-10
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class J Certificate": Any one of the Certificates with a "Class J"
designation on the face thereof, substantially in the form of Exhibit A-11
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class K Certificate": Any one of the Certificates with a "Class K"
designation on the face thereof, substantially in the form of Exhibit A-12
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class L Certificate": Any one of the Certificates with a "Class L"
designation on the face thereof, substantially in the form of Exhibit A-13
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class M Certificate": Any one of the Certificates with a "Class M"
designation on the face thereof, substantially in the form of Exhibit A-14
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class N Certificate": Any one of the Certificates with a "Class N"
designation on the face thereof, substantially in the form of Exhibit A-15
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
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"Class LA-1 Component": A non-certificated beneficial ownership interest in
REMIC III, designated as a "regular interest" therein and entitled to
distributions of interest, subject to the terms and conditions hereof, in an
amount based upon the Class LA-1 Component Rate and the Uncertificated Principal
Balance of REMIC II Regular Interest LA-1 outstanding from time to time.
"Class LA-2 Component": A non-certificated beneficial ownership interest in
REMIC III, designated as a "regular interest" therein and entitled to
distributions of interest, subject to the terms and conditions hereof, in an
amount based upon the Class LA-2 Component Rate and the Uncertificated Principal
Balance of REMIC II Regular Interest LA-2 outstanding from time to time.
"Class LB Component": A non-certificated beneficial ownership interest in
REMIC III, designated as a "regular interest" therein and entitled to
distributions of interest, subject to the terms and conditions hereof, in an
amount based upon the Class LB Component Rate and the Uncertificated Principal
Balance of REMIC II Regular Interest LB outstanding from time to time.
"Class LC Component": A non-certificated beneficial ownership interest in
REMIC III, designated as a "regular interest" therein and entitled to
distributions of interest, subject to the terms and conditions hereof, in an
amount based upon the Class LC Component Rate and the Uncertificated Principal
Balance of REMIC II Regular Interest LC outstanding from time to time.
"Class LD Component": A non-certificated beneficial ownership interest in
REMIC III, designated as a "regular interest" therein and entitled to
distributions of interest, subject to the terms and conditions hereof, in an
amount based upon the Class LD Component Rate and the Uncertificated Principal
Balance of REMIC II Regular Interest LD outstanding from time to time.
"Class LE Component": A non-certificated beneficial ownership interest in
REMIC III, designated as a "regular interest" therein and entitled to
distributions of interest, subject to the terms and conditions hereof, in an
amount based upon the Class LE Component Rate and the Uncertificated Principal
Balance of REMIC II Regular Interest LE outstanding from time to time.
"Class LF Component": A non-certificated beneficial ownership interest in
REMIC III, designated as a "regular interest" therein and entitled to
distributions of interest, subject to the terms and conditions hereof, in an
amount based upon the Class LF Component Rate and the Uncertificated Principal
Balance of REMIC II Regular Interest LF outstanding from time to time.
"Class LG Component": A non-certificated beneficial ownership interest in
REMIC III, designated as a "regular interest" therein and entitled to
distributions of interest, subject to the terms and conditions hereof, in an
amount based upon the Class LG Component Rate and the Uncertificated Principal
Balance of REMIC II Regular Interest LG outstanding from time to time.
"Class LH Component": A non-certificated beneficial ownership interest in
REMIC III, designated as a "regular interest" therein and entitled to
distributions of interest, subject to the
13
terms and conditions hereof, in an amount based upon the Class LH Component Rate
and the Uncertificated Principal Balance of REMIC II Regular Interest LH
outstanding from time to time.
"Class LJ Component": A non-certificated beneficial ownership interest in
REMIC III, designated as a "regular interest" therein and entitled to
distributions of interest, subject to the terms and conditions hereof, in an
amount based upon the Class LJ Component Rate and the Uncertificated Principal
Balance of REMIC II Regular Interest LJ outstanding from time to time.
"Class LK Component": A non-certificated beneficial ownership interest in
REMIC III, designated as a "regular interest" therein and entitled to
distributions of interest, subject to the terms and conditions hereof, in an
amount based upon the Class LK Component Rate and the Uncertificated Principal
Balance of REMIC II Regular Interest LK outstanding from time to time.
"Class LL Component": A non-certificated beneficial ownership interest in
REMIC III, designated as a "regular interest" therein and entitled to
distributions of interest, subject to the terms and conditions hereof, in an
amount based upon the Class LL Component Rate and the Uncertificated Principal
Balance of REMIC II Regular Interest LL outstanding from time to time.
"Class LM Component": A non-certificated beneficial ownership interest in
REMIC III, designated as a "regular interest" therein and entitled to
distributions of interest, subject to the terms and conditions hereof, in an
amount based upon the Class LM Component Rate and the Uncertificated Principal
Balance of REMIC II Regular Interest LM outstanding from time to time.
"Class LN Component": A non-certificated beneficial ownership interest in
REMIC III, designated as a "regular interest" therein and entitled to
distributions of interest, subject to the terms and conditions hereof, in an
amount based upon the Class LN Component Rate and the Uncertificated Principal
Balance of REMIC II Regular Interest LN outstanding from time to time.
"Class LA-1 Component Rate": The amount, if any, by which the Weighted
Average Net Mortgage Rate for such Distribution Date exceeds the Class A-1
Pass-Through Rate.
"Class LA-2 Component Rate": The amount, if any, by which the Weighted
Average Net Mortgage Rate for such Distribution Date exceeds the Class A-2
Pass-Through Rate.
"Class LB Component Rate": The amount, if any, by which the Weighted
Average Net Mortgage Rate for such Distribution Date exceeds the Class B
Pass-Through Rate.
"Class LC Component Rate": The amount, if any, by which the Weighted
Average Net Mortgage Rate for such Distribution Date exceeds the Class C
Pass-Through Rate.
"Class LD Component Rate": The amount, if any, by which the Weighted
Average Net Mortgage Rate for such Distribution Date exceeds the Class D
Pass-Through Rate for such Distribution Date.
14
"Class LE Component Rate": The amount, if any, by which the Weighted
Average Net Mortgage Rate for such Distribution Date exceeds the Class E
Pass-Through Rate for such Distribution Date.
"Class LF Component Rate": The amount, if any, by which the Weighted
Average Net Mortgage Rate for such Distribution Date exceeds the Class F
Pass-Through Rate for such Distribution Date.
"Class LG Component Rate": The amount, if any, by which the Weighted
Average Net Mortgage Rate for such Distribution Date exceeds the Class G
Pass-Through Rate for such Distribution Date.
"Class LH Component Rate": The amount, if any, by which the Weighted
Average Net Mortgage Rate for such Distribution Date exceeds the Class H
Pass-Through Rate for such Distribution Date.
"Class LJ Component Rate": The amount, if any, by which the Weighted
Average Net Mortgage Rate for such Distribution Date exceeds the Class J
Pass-Through Rate for such Distribution Date.
"Class LK Component Rate": The amount, if any, by which the Weighted
Average Net Mortgage Rate for such Distribution Date exceeds the Class K
Pass-Through Rate for such Distribution Date.
"Class LL Component Rate": The amount, if any, by which the Weighted
Average Net Mortgage Rate for such Distribution Date exceeds the Class L
Pass-Through Rate for such Distribution Date.
"Class LM Component Rate": The amount, if any, by which the Weighted
Average Net Mortgage Rate for such Distribution Date exceeds the Class M
Pass-Through Rate for such Distribution Date.
"Class LN Component Rate": The amount, if any, by which the Weighted
Average Net Mortgage Rate for such Distribution Date exceeds the Class N
Pass-Through Rate for such Distribution Date.
"Class Notional Amount": The aggregate notional principal amount on which
the Class X Certificates accrue interest from time to time which, as of any date
of determination, is equal to the then aggregate of the Uncertificated Principal
Balances of REMIC II Regular Interests LA-1, LA-2, LB, LC, LD, LE, LF, LG, LH,
LJ, LK, LL, LM, and LN.
"Class Principal Balance": The aggregate principal amount of any Class of
Principal Balance Certificates outstanding as of any date of determination. On
each Distribution Date, the Class Principal Balance of each Class of the
Principal Balance Certificates shall be reduced by the
15
amount of any distributions of principal made thereon on such Distribution Date
pursuant to Section 4.01(c) and, if and to the extent appropriate, shall be
further reduced on such Distribution Date as provided in Section 4.04(c).
"Class R-I Certificate": Any one of the Certificates with a "Class R-I"
designation on the face thereof, substantially in the form of Exhibit A-16
attached hereto, and evidencing the sole class of "residual interests" in REMIC
I for purposes of the REMIC Provisions.
"Class R-I Distribution Amount": With respect to any Distribution Date, any
amounts available to be paid to the holders of the Class R-I Certificates on
such date after all REMIC I Regular Interests have been paid in full.
"Class R-II Certificate": Any one of the Certificates with a "Class R-II"
designation on the face thereof, substantially in the form of Exhibit A-17
attached hereto, and evidencing the sole class of "residual interests" in REMIC
II for purposes of the REMIC Provisions.
"Class R-II Distribution Amount": With respect to any Distribution Date,
any amounts available to be paid to the holders of the Class R-II Certificates
on such date after all REMIC II Regular Interests have been paid in full.
"Class R-III Certificate": Any one of the Certificates with a "Class R-III"
designation on the face thereof, substantially in the form of Exhibit A-18
attached hereto, and evidencing the sole class of "residual interests" in REMIC
III for purposes of the REMIC Provisions.
"Class R-III Distribution Amount": With respect to any Distribution Date,
any amounts available to be paid to the holders of the Class R-III Certificates
on such date after all REMIC III Regular Certificates have been paid in full.
"Class X Certificate": Any one of the Certificates with a "Class X"
designation on the face thereof, substantially in the form of Exhibit A-1,
evidencing "regular interests" in REMIC III for purposes of the REMIC
Provisions.
"Class X Component": Any of the fourteen (14) components constituting
"regular interests" in REMIC III for purposes of the REMIC Provisions and
comprising the Class X Certificates. Such components are identified as Class
XX-0, XX-0, XX, XX, XX, XX, LF, LG, LH, LJ, LK, LL, LM and LN Components.
"Closing Date": June 9, 1999.
"Code": The Internal Revenue Code of 1986, as amended.
"Collection Period": With respect to any Distribution Date and any Mortgage
Loan, the period commencing immediately following the prior such period (or, in
the case of the initial
16
Collection Period, commencing immediately following the Cut-off Date for such
Mortgage Loan) and ending on and including the related Determination Date.
"Collection Report": The monthly report to be prepared by the Master
Servicer and delivered to the Trustee and the Depositor pursuant to Section
4.02(b).
"Commission": The Securities and Exchange Commission.
"Compensating Interest Payments": Any payment required to be made by the
Master Servicer pursuant to Section 3.19(f) to cover Prepayment Interest
Shortfalls and Extraordinary Prepayment Interest Shortfalls or Section 3.19(e)
to cover Balloon Payment Interest Shortfalls.
"Component Rate": As to each of the Class X Components, the rate reflected
in the definition for such component herein.
"Controlling Class": As of any date of determination, the outstanding Class
of Principal Balance Certificates with the lowest Payment Priority (the Class A
Certificates being treated as a single Class for this purpose) that has a then
outstanding Class Principal Balance at least equal to 25% of the Initial Class
Principal Balance thereof (or, if no Class of Principal Balance Certificates
outstanding has a Class Principal Balance at least equal to 25% of the Initial
Class Principal Balance thereof, then the "Controlling Class" shall be the
outstanding Class of Principal Balance Certificates with the then largest
remaining Class Principal Balance, and if two or more classes of Principal
Balance Certificates have the largest remaining Class Principal Balances, the
outstanding class of Principal Balance Certificates with the lowest Payment
Priority). Initially, the Controlling Class will consist of the Class N
Certificates.
"Corporate Trust Office": The principal corporate trust office of the
Trustee at which at any particular time its corporate trust business with
respect to this Agreement shall be administered, which office at the date of the
execution of this Agreement is located at 000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000,
Xxxxxxx, Xxxxxxxx 00000, Attention: Asset Backed Securities Trust Services Group
- GMAC Commercial Mortgage Securities, Inc. Series 1999 C2.
"Corrected Mortgage Loan": Any Mortgage Loan (and each related
Cross-Collateralized Mortgage Loan) that had been a Specially Serviced Mortgage
Loan but has ceased to be such in accordance with the definition of "Specially
Serviced Mortgage Loan" (other than by reason of a Liquidation Event occurring
in respect of such Mortgage Loan or a related Mortgaged Property becoming an REO
Property).
"CPR": An assumed constant rate of prepayment each month (which is quoted
on a per annum basis) relative to the then outstanding principal balance of a
pool of mortgage loans for the life of such mortgage loans.
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"Credit File": Any documents, other than documents required to be part of
the related Mortgage File, in the possession of the Master Servicer or Special
Servicer and relating to the origination and servicing of any Mortgage Loan.
"Credit Lease": With respect to each Credit Lease Loan, the lease agreement
between the Mortgagor as lessor and the Tenant as lessee of the related Mortgage
Property.
"Credit Lease Loan": Each Mortgage Loan that is identified as a "Credit
Lease Loan" on the Mortgage Loan Schedule.
"Cross-Collateralized Mortgage Loans": Any two or more Mortgage Loans
listed on the Mortgage Loan Schedule that are cross-collateralized with each
other.
"CSSA Periodic Loan File": The monthly report in the "CSSA periodic loan
file" format containing such information for the Mortgage Loans as may be
reasonably requested by the Depositor, which report shall be substantially in
the form attached hereto as Exhibit J.
"Current Principal Distribution Amount": With respect to any Distribution
Date, an amount equal to the aggregate of the following (without duplication):
(a) the principal portions of all Monthly Payments (other than Balloon
Payments) and any Assumed Monthly Payments due or deemed due, as the case
may be, in respect of the Mortgage Loans and any REO Loans for their
respective Due Dates occurring during the same calendar month as such
Distribution Date;
(b) all Principal Prepayments received on the Mortgage Loans during
the related Collection Period;
(c) with respect to any Balloon Mortgage Loan as to which the related
Stated Maturity Date occurred or any ARD Loan as to which the related
Anticipated Repayment Date occurred, during or prior to the related
Collection Period, any payment of principal (exclusive of any Principal
Prepayment and any amount described in subclause (d) below) that was made
by or on behalf of the related Mortgagor during the related Collection
Period, net of any portion of such payment that represents a recovery of
the principal portion of any Monthly Payment (other than a Balloon Payment)
due, or the principal portion of any Assumed Monthly Payment deemed due, in
respect of such Mortgage Loan on a Due Date during or prior to the same
calendar month as such Distribution Date and not previously recovered;
(d) that portion of all Liquidation Proceeds (exclusive of any Excess
Liquidation Proceeds) and Insurance Proceeds received on or in respect of
the Mortgage Loans during the related Collection Period that were
identified and applied by the Master Servicer as recoveries of principal
thereof, in each case net of any portion of such amounts that represents a
recovery of the principal portion of any Monthly Payment (other than a
Balloon
18
Payment) due, or of the principal portion of any Assumed Monthly Payment
deemed due, in respect of any such Mortgage Loan on a Due Date during or
prior to the same calendar month as such Distribution Date and not
previously recovered; and
(e) that portion of all Liquidation Proceeds (exclusive of any Excess
Liquidation Proceeds), Insurance Proceeds and REO Revenues received on or
in respect of any REO Properties during the related Collection Period that
were identified and applied by the Master Servicer as recoveries of
principal of the REO Loans, in each case net of any portion of such amounts
that represents a recovery of the principal portion of any Monthly Payment
(other than a Balloon Payment) due, or of the principal portion of any
Assumed Monthly Payment deemed due, in respect of any such REO Loan or the
related Mortgage Loan on a Due Date during or prior to same calendar month
as such Distribution Date and not previously recovered.
"Custodian": A Person who is at any time appointed by the Trustee pursuant
to Section 8.11 as a document custodian for the Mortgage Files, which Person
shall not be the Depositor, the Mortgage Loan Seller or an Affiliate of either
of them. The Trustee shall act as the initial Custodian.
"Cut-off Date": With respect to any Mortgage Loan, the Due Date for such
Mortgage Loan in June 1999.
"Cut-off Date Principal Balance": With respect to any Mortgage Loan, the
outstanding principal balance of such Mortgage Loan as of the Cut-off Date,
after application of all payments of principal due on or before such date,
whether or not received.
"Debt Service Coverage Ratio": With respect to any Mortgage Loan (or group
of Cross-Collateralized Mortgage Loans) for any specified period, the debt
service coverage ratio calculated in accordance with Exhibit I using the
methodologies set forth in Exhibit F.
"Debt Service Reduction": With respect to any Mortgage Loan, a reduction in
the scheduled Monthly Payment for such Mortgage Loan by a court of competent
jurisdiction in a proceeding under the Bankruptcy Code, other than a reduction
resulting from a Deficient Valuation.
"Defaulted Mortgage Loan": A Mortgage Loan that is delinquent in an amount
equal to at least two Monthly Payments or is delinquent thirty days or more in
respect of its Balloon Payment, if any, in either case such delinquency to be
determined without giving effect to any grace period permitted by the related
Mortgage or Mortgage Note and without regard to any acceleration of payments
under the related Mortgage and Mortgage Note.
"Default Interest": With respect to any Mortgage Loan (or related REO
Loan), any amounts collected thereon, other than interest at the Revised Rate
accrued on any ARD Loan after its Anticipated Repayment Date, late payment
charges and Prepayment Premiums, that represent
19
penalty interest in excess of interest on the principal balance of such Mortgage
Loan (or REO Loan) accrued at the related Mortgage Rate.
"Defaulting Party": As defined in Section 7.01(b).
"Defeasance Collateral": Noncallable government obligations of (or
non-callable obligations, fully guaranteed as to timely payment by) the United
States of America, as are permitted under the terms of a Mortgage Note or
related Mortgage Loan Documents, but only if such obligations or assets
constitute "government securities" under the defeasance rule of the REMIC
Provisions.
"Defeasance Loan": A Mortgage Loan that is designated as such on the
Mortgage Loan Schedule.
"Defeasance Option": The right of a Mortgagor, pursuant to the terms of the
related Mortgage Note or related Mortgage Loan Documents, to obtain a release of
any portion of the related Mortgaged Property from the lien of the related
Mortgages upon the pledge to the Trustee of Defeasance Collateral.
"Defect": As defined in Section 2.02(e).
"Deficient Valuation": With respect to any Mortgage Loan, a valuation by a
court of competent jurisdiction of the Mortgaged Property in an amount less than
the then outstanding principal balance of the Mortgage Loan, which valuation
results from a proceeding initiated under the Bankruptcy Code.
"Definitive Certificate": As defined in Section 5.03(a).
"Deleted Mortgage Loan": A Mortgage Loan which is repurchased from the
Trust pursuant to the terms hereof or as to which one or more Qualifying
Substitute Mortgage Loans are substituted.
"Delinquency Advance": As to any Mortgage Loan or REO Loan, any advance
made by the Master Servicer, the Trustee or the Fiscal Agent pursuant to Section
4.03.
"Delinquency Advance Date": The Business Day preceding each Distribution
Date.
"Delinquent Loan Status Report": A report or reports setting forth, among
other things, those Mortgage Loans which, as of the close of business on the
immediately preceding Determination Date, were (i) delinquent 30-59 days, (ii)
delinquent 60-89 days, (iii) delinquent 90 days or more, (iv) current but
specially serviced, (v) in foreclosure but as to which the related Mortgaged
Property had not become REO Property, or (vi) related to Mortgaged Property
which had become REO Property, together with such additional information in
respect of each such Mortgage Loan as is contemplated on Exhibit H hereto.
20
"Depositor": GMAC Commercial Mortgage Securities, Inc. or its successor in
interest.
"Depository": The Depository Trust Company, or any successor Depository
hereafter named. The nominee of the initial Depository for purposes of
registering those Certificates that are to be Book-Entry Certificates, is Cede &
Co. The Depository shall at all times be a "clearing corporation" as defined in
Section 8-102(3) of the Uniform Commercial Code of the State of New York and a
"clearing agency" registered pursuant to the provisions of Section 17A of the
Exchange Act.
"Depository Participant": A broker, dealer, bank or other financial
institution or other Person for whom from time to time the Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
"Determination Date": With respect to any Distribution Date, the 5th day of
the month in which such Distribution Date occurs, or if such 5th day is not a
Business Day, the Business Day immediately following.
"Directly Operate": With respect to any REO Property, the furnishing or
rendering of services to the tenants thereof that are not (within the meaning of
Treasury Regulations Section 1.512(b)-1(c)(5)) customarily provided to tenants
in connection with the rental of space for occupancy, the management or
operation of such REO Property, the holding of such REO Property primarily for
sale to customers in the ordinary course of a trade or business, the performance
of any construction work thereon or any use of such REO Property in a trade or
business conducted by REMIC I, in each case other than through an Independent
Contractor; provided, however, that the Trustee (or the Special Servicer on
behalf of the Trustee) shall not be considered to Directly Operate an REO
Property solely because the Trustee (or the Special Servicer on behalf of the
Trustee) establishes rental terms, chooses tenants, enters into or renews
leases, deals with taxes and insurance, or makes decisions as to repairs (of the
type that would be deductible under Code Section 162) or capital expenditures
with respect to such REO Property.
"Discount Rate": With respect to each Mortgage Loan as to which there has
been a prepayment during a Collection Period and for which a Prepayment Premium
is collected, the yield (compounded monthly) for "This Week" as reported by the
Federal Reserve Board in Federal Reserve Statistical Release H.15(519) for the
constant maturity treasury having a maturity coterminous with the Anticipated
Repayment Date, in the case of an ARD Loan, or the Maturity Date, in the case of
each other Mortgage Loan, of such Mortgage Loan as of the related Determination
Date. If there is no Discount Rate for instruments having a maturity coterminous
with the Maturity Date or Anticipated Repayment Date, as applicable, of the
applicable Mortgage Loan, then the Discount Rate will be equal to the linear
interpolation of the yields of the constant maturity treasuries with maturities
next longer and shorter than such Maturity Date or Anticipated Repayment Date,
as the case may be.
21
"Discount Rate Fraction": With respect to the distribution of any
Prepayment Premium received with respect to any Mortgage Loan to the Holders of
any Class of Principal Balance Certificates on any Distribution Date, a fraction
(not greater than 1.0 or less than zero), (a) the numerator of which is equal to
the excess, if any, of (x) the Pass-Through Rate for such Class of Certificates
over (y) the relevant Discount Rate and (b) the denominator of which is equal to
the excess, if any, of (x) the Mortgage Rate of the related Mortgage Loan over
(y) the relevant Discount Rate.
"Distributable Certificate Interest": With respect to any Class of REMIC
III Regular Certificates, for any Distribution Date, the Accrued Certificate
Interest in respect of such Class of Certificates for such Distribution Date,
reduced (to not less than zero) by that portion, if any, of the Net Aggregate
Prepayment Interest Shortfall, if any, for such Distribution Date allocated to
such Class of Certificates as set forth below. The Net Aggregate Prepayment
Interest Shortfall, if any, for each Distribution Date shall be allocated on
such Distribution Date among the REMIC Regular Certificates, pro rata, in
accordance with the respective amounts of Accrued Certificate Interest for such
Classes of Certificates for such Distribution Date. The Net Aggregate Prepayment
Interest Shortfall, if any, allocated to the Class X Certificate for each
Distribution Date shall be allocated to each Class X Component pro rata, in
accordance with the respective amount of Accrued Certificate Interest
attributable to such Class X Component.
"Distribution Account": The segregated account or accounts created and
maintained by the Trustee pursuant to Section 3.04(b) in trust for the
Certificateholders, which shall be entitled "LaSalle Bank National Association,
as Trustee, in trust for the registered holders of GMAC Commercial Mortgage
Securities, Inc., Mortgage Pass-Through Certificates, Series 1999-C2". Any such
account or accounts shall be an Eligible Account.
"Distribution Date": The 15th day of any month, or if such 15th day is not
a Business Day, the Business Day immediately following, commencing in July 1999.
"Distribution Date Statement": As defined in Section 4.02(a).
"Due Date": With respect to (i) any Mortgage Loan on or prior to its
Maturity Date, the day of the month set forth in the related Mortgage Note on
which each Monthly Payment thereon is scheduled to be first due; (ii) any
Balloon Mortgage Loan after the Maturity Date therefor, the day of the month set
forth in the related Mortgage Note on which each Monthly Payment on such
Mortgage Loan had been scheduled to be first due; and (iii) any REO Loan, the
day of the month set forth in the related Mortgage Note on which each Monthly
Payment on the related Mortgage Loan had been scheduled to be first due.
"Eligible Account": An account that is any of the following: (i) maintained
with a depository institution or trust company whose (A) commercial paper,
short-term unsecured debt obligations or other short-term deposits are rated at
least A-1 by Standard & Poor's and either (x) P-1 by Moody's or (y) F-1+ (or its
equivalent) by FITCH IBCA, if the deposits are to be held in the account for 30
days or less, or (B) long-term unsecured debt obligations are rated at least AA-
by
22
Standard & Poor's and either (x) Aa3 by Moody's or (y) AA- (or its equivalent)
by FITCH IBCA, if the deposits are to be held in the account more than 30 days,
or (ii) a segregated trust account or accounts maintained in the trust
department of the Trustee or other financial institution subject to regulations
regarding fiduciary funds on deposit similar to Title 12 of the Code of Federal
Regulations Section 9.10(b), or (iii) an account or accounts of a depository
institution acceptable to each Rating Agency, as evidenced by written
confirmation from such Rating Agency to the effect that use of any such account
as the Certificate Account or the Distribution Account would not result in the
downgrade, qualification or withdrawal of the rating then assigned to any Class
of Certificates by such Rating Agency.
"Emergency Advance": Any Servicing Advance that must be made within five
Business Days by the Special Servicer in order to avoid any material penalty,
any material harm to a Mortgaged Property or any other material adverse
consequence to the Trust Fund.
"Environmental Assessment": A "Phase I assessment" conducted in accordance
with ASTM Standard E 1527-93 or any successor thereto published by ASTM.
"ERISA": The Employee Retirement Income Security Act of 1974, as amended.
"Escrow Payment": Any payment received by the Master Servicer or the
Special Servicer for the account of any Mortgagor for application toward the
payment of real estate taxes, assessments, insurance premiums, ground rents (if
applicable) and similar items in respect of the related Mortgaged Property.
"Event of Default": One or more of the events described in Section 7.01(a).
"Excess Interest": With respect to each of the ARD Loans, interest accrued
on such ARD Loan and allocable to the Excess Rate and, except to the extent
limited by applicable law, interest accrued at the Revised Rate on any such
accrued interest that is unpaid. The Excess Interest is an asset of the Trust
Fund which is a Grantor Trust Asset not held in REMIC I, REMIC II or REMIC III.
"Excess Liquidation Proceeds": With respect to any Mortgage Loan, the
excess of (i) Liquidation Proceeds of that Mortgage Loan or related REO Property
net of any related Liquidation Expenses, over (ii) the amount that would have
been received if a Principal Payment in full had been made with respect to such
Mortgage Loan on the date such proceeds were received.
"Excess Liquidation Proceeds Reserve Account": The segregated account
created and maintained by the Trustee pursuant to Section 3.04(d) in trust for
the Certificateholders, which shall be entitled "LaSalle Bank National
Association, as Trustee, in trust for the registered holders of GMAC Commercial
Mortgage Securities, Inc., Mortgage Pass-Through Certificates, Series 1999-C2 --
Excess Liquidation Proceeds Reserve Account." Any such account shall be an
Eligible Account.
23
"Excess Rate": With respect to each ARD Loan after the related Anticipated
Repayment Date, the excess of (i) the applicable Revised Rate over (ii) the
applicable initial Mortgage Rate, each as set forth in the Mortgage Loan
Schedule.
"Exchange Act": The Securities Exchange Act of 1934, as amended.
"Extraordinary Prepayment Interest Shortfall": With respect to any Late Due
Date Mortgage Loan that was subject to a Principal Prepayment in full or in part
(including, without limitation, an early Balloon Payment) during any Collection
Period, which Principal Prepayment was applied to such Late Due Date Mortgage
Loan prior to such Mortgage Loan's Due Date in the next succeeding Collection
Period, the amount of interest that would have accrued at the related Net
Mortgage Rate on the amount of such Principal Prepayment from the date as of
which such Principal Prepayment was received to but not including the Due Date
of such Mortgage Loan in the next succeeding Collection Period, to the extent
not collected from the related Mortgagor (without regard to any Prepayment
Premium or Excess Interest that may have been collected) and to the extent that
any portion thereof does not represent a Balloon Payment Interest Shortfall.
"FDIC": Federal Deposit Insurance Corporation or any successor.
"FHLMC": Federal Home Loan Mortgage Corporation or any successor.
"Final Distribution Date": The final Distribution Date on which any
distributions are to be made on the Certificates as contemplated by Section
9.01.
"Final Recovery Determination": A determination by the Special Servicer
with respect to any defaulted Mortgage Loan or REO Property (other than a
Mortgage Loan or REO Property, as the case may be, that was purchased by a
Mortgage Loan Seller pursuant to Section 6 of the related Mortgage Loan Purchase
Agreement, by the Majority Certificateholder of a Controlling Class pursuant to
Section 3.18(b) or by the Master Servicer or the Special Servicer pursuant to
Section 3.18(c) or by the Master Servicer or the Depositor pursuant to Section
9.01) that, in the reasonable and good faith judgment of the Special Servicer,
there has been a recovery of all Insurance Proceeds, Liquidation Proceeds and
other payments or recoveries that, in the Special Servicer's judgment, exercised
without regard to any obligation of the Master Servicer or the Special Servicer
to make payments from its own funds pursuant to Section 3.07(b), will ultimately
be recoverable.
"Fiscal Agent": ABN AMRO Bank N.V., a banking organization organized under
the laws of the Netherlands, its successor in interest, or any successor Fiscal
Agent appointed as provided herein.
"Fiscal Agent Termination Event": As defined in Section 8.15.
"FITCH IBCA": FITCH IBCA, Inc. or its successor in interest. If neither
such rating agency nor any successor remains in existence, "FITCH IBCA" shall be
deemed to refer to such
24
other nationally recognized statistical rating agency or other comparable Person
designated by the Depositor, notice of which designation shall be given to the
Trustee, the Master Servicer and the Special Servicer and specific ratings of
FITCH IBCA, Inc. herein referenced shall be deemed to refer to the equivalent
ratings of the party so designated.
"Fixed Rate Mortgage Loan": A Mortgage Loan as to which the related
Mortgage Note provides, as of the Closing Date, for a Mortgage Rate that remains
fixed through the remaining term thereof (without regard to any extension at the
Mortgagor's or the mortgagee's option under the terms of the related Mortgage
Loan documents).
"FNMA": Federal National Mortgage Association or any successor.
"GMACCM": GMAC Commercial Mortgage Corporation or its successor in
interest.
"Grantor Trust": That certain "grantor trust" (within the meaning of the
Grantor Trust Provisions), the assets of which include the Grantor Trust Assets.
"Grantor Trust Assets": Any Excess Interest.
"Grantor Trust Provisions": Subpart E of Subchapter J and Section 7701 of
the Code, and final Treasury Regulations, published rulings, notices and
announcements, promulgated thereunder, as the foregoing may be in effect from
time to time.
"Gross Margin": With respect to each Adjustable Rate Mortgage Loan (and any
successor REO Loan), the fixed number of percentage points set forth in the
Mortgage Loan Schedule that is added to the applicable value of the related
Index on each Interest Rate Adjustment Date in accordance with the terms of the
related Mortgage Note to determine, subject to any applicable periodic and
lifetime limitations on adjustments thereto, the related Mortgage Rate.
"Ground Lease": The ground lease pursuant to which any Mortgagor holds a
leasehold interest in the related Mortgaged Property.
"Guarantor": The guarantor under any Guaranty with respect to a Credit
Lease.
"Guaranty": With respect to any Credit Lease Loan, a guaranty agreement
executed by an affiliate of the related Tenant that guarantees the Tenant's
obligations under the related Credit Lease.
"Hazardous Materials": Any dangerous, toxic or hazardous pollutants,
chemicals, wastes, or substances, including, without limitation, those so
identified pursuant to CERCLA or any other federal, state or local environmental
related laws and regulations, and specifically including, without limitation,
asbestos and asbestos-containing materials, polychlorinated biphenyls ("PCBs"),
radon gas, petroleum and petroleum products, urea formaldehyde and any
substances classified as
25
being "in inventory", "usable work in process" or similar classification which
would, if classified as unusable, be included in the foregoing definition.
"Historical Loan Modification Report": A report or reports setting forth,
among other things, those Mortgage Loans which, as of the close of business on
the immediately preceding Determination Date, have been modified pursuant to
this Agreement (i) during the Collection Period ending on such Determination
Date and (ii) since the Cut-off Date, showing the original and the revised terms
thereof, together with such additional information in respect of each such
Mortgage Loan as is contemplated by Exhibit H hereto.
"Historical Loss Report": A report or reports setting forth, among other
things, as of the close of business on the immediately preceding Determination
Date, (i) the amount of Liquidation Proceeds and Liquidation Expenses, both for
the Collection Period ending on such Determination Date and for all prior
Collection Periods, and (ii) the amount of Realized Losses occurring during such
Collection Period and historically, set forth on a Mortgage Loan-by-Mortgage
Loan and REO Property-by-REO Property basis, together with such additional
information in respect of each Mortgage Loan and REO Property as to which a
Final Recovery Determination has been made as is contemplated by Exhibit H
hereto.
"Independent": When used with respect to any specified Person, any such
Person who (i) is in fact independent of the Depositor, the Master Servicer, the
Special Servicer, the Trustee and any and all Affiliates thereof, (ii) does not
have any direct financial interest in or any material indirect financial
interest in any of the Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Fiscal Agent or any Affiliate thereof, and (iii) is not connected
with the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Fiscal Agent or any Affiliate thereof as an officer, employee, promoter,
underwriter, trustee, partner, director or Person performing similar functions;
provided, however, that a Person shall not fail to be Independent of the
Depositor, the Master Servicer, the Special Servicer or any Affiliate thereof
merely because such Person is the beneficial owner of 1% or less of any class of
securities issued by the Depositor, the Master Servicer or any Affiliate
thereof, as the case may be.
"Independent Contractor": Any Person that would be an "independent
contractor" with respect to REMIC I within the meaning of Section 856(d)(3) of
the Code if REMIC I were a real estate investment trust (except that the
ownership test set forth in that section shall be considered to be met by any
Person that owns, directly or indirectly, 35 percent or more of any Class of
Certificates, or such other interest in any Class of Certificates as is set
forth in an Opinion of Counsel, which shall be at no expense to the Trustee or
the Trust Fund, delivered to the Trustee), so long as REMIC I does not receive
or derive any income from such Person and provided that the relationship between
such Person and REMIC I is at arm's length, all within the meaning of Treasury
Regulation Section 1.856-4(b)(5), or any other Person upon receipt by the
Trustee of an Opinion of Counsel, which shall be at no expense to the Trustee or
the Trust Fund, to the effect that the taking of any action in respect of any
REO Property by such Person, subject to any conditions therein specified, that
is otherwise herein contemplated to be taken by an Independent Contractor will
not cause such REO Property to cease to qualify as "foreclosure property" within
the meaning of Section
26
860G(a)(8) of the Code (determined without regard to the exception applicable
for purposes of Section 860D(a) of the Code), or cause any income realized in
respect of such REO Property to fail to qualify as Rents from Real Property.
"Index": With respect to each Adjustable Rate Mortgage Loan (and any
successor REO Loan), for each Interest Rate Adjustment Date, the base index used
to determine the new Mortgage Rate in effect thereon as specified in the related
Mortgage Note. If the Index currently in effect for any Adjustable Rate Mortgage
Loan (or successor REO Loan) ceases to be available, the Master Servicer shall,
subject to Section 3.19(a) and the terms of the related Mortgage Note, select a
comparable alternative index.
"Initial Balance": The aggregate Cut-off Date Principal Balance of the
Mortgage Loans.
"Initial Class Notional Amount": With respect to the Class X Certificates,
the initial Class Notional Amount thereof as of the Closing Date, equal to
$974,502,236.
"Initial Class Principal Balance": With respect to any Class of Principal
Balance Certificates, the initial Class Principal Balance thereof as of the
Closing Date, in each case as set forth in the Preliminary Statement.
"Insurance Policy": With respect to any Mortgage Loan, any hazard insurance
policy, flood insurance policy, title policy, credit lease enhancement insurance
policy, residual value insurance policy or other insurance policy that is
maintained from time to time in respect of such Mortgage Loan or the related
Mortgaged Property.
"Insurance Proceeds": Proceeds paid under any Insurance Policy, to the
extent such proceeds are not applied to the restoration of the related Mortgaged
Property or released to the Mortgagor, in either case, in accordance with the
Servicing Standard (including any amounts paid by the Master Servicer or Special
Servicer pursuant to Section 3.07).
"Interest Accrual Period": With respect to any Distribution Date, the
calendar month immediately preceding the month in which such Distribution Date
occurs.
"Interest Rate Adjustment Date": With respect to each Adjustable Rate
Mortgage Loan (and any successor REO Loan), any date on which the related
Mortgage Rate is subject to adjustment pursuant to the related Mortgage Note.
The first Interest Rate Adjustment Date subsequent to the Cut-off Date for each
Adjustable Rate Mortgage Loan is specified in the Mortgage Loan Schedule, and
successive Interest Rate Adjustment Dates for such Mortgage Loan (and any
successor REO Loan) shall thereafter periodically occur with the frequency
specified in the Mortgage Loan Schedule.
"Interest Reserve Account": The segregated account created and maintained
by the Trustee pursuant to Section 3.04(c) in trust for the Certificateholders,
which shall be entitled
27
"LaSalle Bank National Association, as Trustee, in trust for the registered
holders of GMAC Commercial Mortgage Securities, Inc., Mortgage Pass-Through
Certificates, Series 1999-C2 --Interest Reserve Account." Any such account shall
be an Eligible Account.
"Interest Reserve Loans": Any Mortgage Loan bearing interest computed on an
actual/360 basis.
"Interested Person": The Depositor, the Master Servicer, the Special
Servicer, any Holder of a Certificate, or any Affiliate of any such Person.
"Investment Account": Each of the Certificate Account, the Distribution
Account, any Lock-Box Account, any Cash Collateral Account, the Interest Reserve
Account or any REO Account.
"Investor Certification": A certification in the form of Exhibit K hereto.
"Issue Price": With respect to each Class of Certificates, the "issue
price" as defined in the REMIC Provisions.
"Late Collections": With respect to any Mortgage Loan, all amounts received
thereon during any Collection Period, whether as payments, Insurance Proceeds,
Liquidation Proceeds, payments of Substitution Shortfall Amounts, or otherwise,
which represent late payments or collections of principal or interest due in
respect of such Mortgage Loan (without regard to any acceleration of amounts due
thereunder by reason of default) on a Due Date in a previous Collection Period
(or, in the case of a Late Due Date Mortgage Loan, on any Due Date prior to the
date of receipt) and not previously recovered. With respect to any Distribution
Date and any REO Loan, all amounts received in connection with the related REO
Property during any Collection Period, whether as Insurance Proceeds,
Liquidation Proceeds, REO Revenues or otherwise, which represent late
collections of principal or interest due or deemed due in respect of such REO
Loan or the predecessor Mortgage Loan (without regard to any acceleration of
amounts due under the predecessor Mortgage Loan by reason of default) on a Due
Date in a previous Collection Period (or, in the case of a Late Due Date
Mortgage Loan, on any Due Date prior to the date of receipt) and not previously
recovered. The term "Late Collections" shall specifically exclude Penalty
Charges.
"Late Due Date Mortgage Loan": Any Mortgage Loan (or successor REO Loan)
with a Due Date which occurs after the Determination Date in the same calendar
month as such Due Date.
"Liquidation Event": With respect to any Mortgage Loan, any of the
following events: (i) such Mortgage Loan is paid in full; (ii) a Final Recovery
Determination is made with respect to such Mortgage Loan; (iii) such Mortgage
Loan is repurchased or replaced by a Mortgage Loan Seller pursuant to Section 6
of the related Mortgage Loan Purchase Agreement or by GMACCM pursuant to Section
4 of either Supplemental Agreement; (iv) such Mortgage Loan is purchased by the
Majority Certificateholder of the Controlling Class pursuant to Section 3.18(b);
(v) such Mortgage Loan is purchased by the Master Servicer or the Special
Servicer pursuant to
28
Section 3.18(c); or (vi) such Mortgage Loan is purchased by the Master Servicer
or the Depositor pursuant to Section 9.01. With respect to any REO Property (and
the related REO Loan), any of the following events: (i) a Final Recovery
Determination is made with respect to such REO Property; or (ii) such REO
Property is purchased by the Master Servicer or the Depositor pursuant to
Section 9.01.
"Liquidation Expenses": All customary, reasonable and necessary "out of
pocket" costs and expenses incurred by the Special Servicer in connection with
the liquidation of any Specially Serviced Mortgage Loan or REO Property pursuant
to Section 3.09 or 3.18 (including, without limitation, legal fees and expenses,
committee or referee fees and, if applicable, brokerage commissions and
conveyance taxes).
"Liquidation Fee": With respect to each Specially Serviced Mortgage Loan or
REO Property (other than any Specially Serviced Mortgage Loan or REO Property
purchased by the Majority Certificateholder of the Controlling Class, the Master
Servicer or the Special Servicer pursuant to Section 3.18 or by the Master
Servicer or the Depositor pursuant to Section 9.01), the fee designated as such
and payable to the Special Servicer pursuant to Section 3.11(c).
"Liquidation Fee Rate": With respect to each Specially Serviced Mortgaged
Loan or REO Property as to which a Liquidation Fee is payable, 1.00%.
"Liquidation Proceeds": Cash amounts (other than Insurance Proceeds and REO
Revenues) received or paid by the Master Servicer or the Special Servicer in
connection with: (i) the taking of all or a part of a Mortgaged Property by
exercise of the power of eminent domain or condemnation; (ii) the liquidation of
a Mortgaged Property or other collateral constituting security for a defaulted
Mortgage Loan, through trustee's sale, foreclosure sale, REO Disposition or
otherwise, exclusive of any portion thereof required to be released to the
related Mortgagor in accordance with applicable law and the terms and conditions
of the related Mortgage Note and Mortgage; (iii) the realization upon any
deficiency judgment obtained against a Mortgagor; (iv) the purchase of a
Defaulted Mortgage Loan by the Majority Certificateholder of the Controlling
Class pursuant to Section 3.18(b) or by the Master Servicer or the Special
Servicer pursuant to Section 3.18(c) or any other sale thereof pursuant to
Section 3.18(d); (v) the repurchase of a Mortgage Loan by a Mortgage Loan Seller
pursuant to Section 6 of the related Mortgage Loan Purchase Agreement or by
GMACCM pursuant to Section 4 of either Supplemental Agreement; (vi) the payment
of any Substitution Shortfall Amount by a Mortgage Loan Seller pursuant to
Section 6 of the related Mortgage Loan Purchase Agreement or by GMACCM pursuant
to Section 4 of either Supplemental Agreement; or (vii) the purchase of a
Mortgage Loan or REO Property by the Master Servicer or the Depositor pursuant
to Section 9.01.
"Loan-to-Value Ratio": With respect to any Mortgage Loan, as of any date of
determination, the fraction, expressed as a percentage, the numerator of which
is the then unpaid principal balance of such Mortgage Loan, and the denominator
of which is the Appraised Value of the related Mortgaged Property as determined
by an Appraisal thereof.
29
"Lock-Box Account": With respect to any Mortgaged Property, if applicable,
any account created pursuant to any documents relating to a Mortgage Loan to
receive revenues therefrom. Any Lock-Box Account shall be beneficially owned for
federal income tax purposes by the Person who is entitled to receive the
reinvestment income or gain thereon in accordance with the terms and provisions
of the related Mortgage Loan and Section 3.06, which Person shall be taxed on
all reinvestment income or gain thereon. The Master Servicer shall be permitted
to make withdrawals therefrom for deposit into the related Cash Collateral
Accounts.
"Lock-Box Agreement": With respect to any Mortgage Loan, the lock-box
agreement, if any, between the originator of such Mortgage Loan and the
Mortgagor, pursuant to which the related Lock-Box Account, if any, is to be
established.
"Loss Reimbursement Amount": With respect to any REMIC I Regular Interest
and any Distribution Date (except the initial Distribution Date, with respect to
which the Loss Reimbursement Amount for such REMIC I Regular Interest will be
zero), an amount equal to (a)(i) the Loss Reimbursement Amount with respect to
such REMIC I Regular Interest for the immediately preceding Distribution Date,
minus (ii) the aggregate of all reimbursements deemed made to REMIC II on the
immediately preceding Distribution Date pursuant to Section 4.01(a) with respect
to such REMIC I Regular Interest, plus (iii) the aggregate of all reductions
made to the Uncertificated Principal Balance of (and, accordingly, the aggregate
of all Realized Losses and Additional Trust Fund Expenses deemed allocated to)
such REMIC I Regular Interest on the immediately preceding Distribution Date
pursuant to Section 4.04(a), plus (b) one month's interest (calculated on the
basis of a 360-day year consisting of twelve 30-day months) on the amount
described in clause (a) at the REMIC I Remittance Rate applicable to such REMIC
I Regular Interest for the current Distribution Date.
"MAI": Member of Appraisal Institute.
"Majority Certificateholder": With respect to any specified Class or
Classes of Certificates, as of any date of determination, any Holder or
particular group of Holders of Certificates of such Class or Classes, as the
case may be, entitled to a majority of the Voting Rights allocated to such Class
or Classes in each case determined without giving effect to the last sentence of
the definition of "Voting Rights."
"Master Servicer": GMACCM, or any successor master servicer appointed as
herein provided.
"Master Servicer Remittance Date": The Business Day preceding each
Distribution Date.
"Master Servicing Fee": With respect to any Distribution Date and each
Mortgage Loan and REO Loan, the Servicing Fee payable to the Master Servicer
pursuant to Section 3.11(a).
30
"Master Servicing Fee Rate": With respect to each Mortgage Loan and REO
Loan acquired by the Depositor, 0.02% per annum.
"Maturity Date": With respect to any Mortgage Loan as of any date of
determination, the date on which the last payment of principal is due and
payable under the related Mortgage Note, after taking into account all Principal
Prepayments received prior to such date of determination and any extension
permitted at the Mortgagor's option under the terms of the related Mortgage Note
(as in effect on the Closing Date) and this Agreement, but without giving effect
to (i) any acceleration of the principal of such Mortgage Loan by reason of
default thereunder, (ii) any grace period permitted by the related Mortgage
Note, (iii) any modification, waiver or amendment of such Mortgage Loan granted
or agreed to by the Master Servicer or Special Servicer pursuant to Section 3.20
or (iv) in the case of an ARD Loan, the Anticipated Repayment Date for such
Mortgage Loan.
"Modified Mortgage Loan": Any Mortgage Loan as to which any Servicing
Transfer Event has occurred and which has been modified by the Special Servicer
pursuant to Section 3.20 in a manner that:
(A) affects the amount or timing of any payment of principal or
interest due thereon (other than, or in addition to, bringing current
Monthly Payments with respect to such Mortgage Loan);
(B) except as expressly contemplated by the related Mortgage, results
in a release of the lien of the Mortgage on any material portion of the
related Mortgaged Property without a corresponding Principal Prepayment in
an amount not less than the fair market value (as is), as determined by an
Appraisal delivered to the Special Servicer (at the expense of the related
Mortgagor and upon which the Special Servicer may conclusively rely), of
the property to be released; or
(C) in the good faith and reasonable judgment of the Special Servicer,
otherwise materially impairs the security for such Mortgage Loan or reduces
the likelihood of timely payment of amounts due thereon.
"Monthly Payment": With respect to any Mortgage Loan, the scheduled monthly
payment of principal and/or interest on such Mortgage Loan, including any
Balloon Payment, which is payable by a Mortgagor from time to time under the
terms of the related Mortgage Note (as such may be modified at any time
following the Closing Date) and applicable law, without regard to the accrual of
Excess Interest on or the application of any excess cash flow to pay principal
on any ARD Loan.
"Moody's": Xxxxx'x Investors Service, Inc. or its successor in interest. If
neither such rating agency nor any successor remains in existence, "Moody's"
shall be deemed to refer to such other nationally recognized statistical rating
agency or other comparable Person designated by the Depositor. Notice of which
designation shall be given to the Trustee, the Master Servicer and
31
the Special Service and specific ratings of Xxxxx'x Investors Service, Inc.
herein referenced shall be deemed to refer to the equivalent ratings of the
party so designated.
"Mortgage": With respect to any Mortgage Loan, separately and collectively,
as the context may require, each mortgage, deed of trust or other instrument
securing a Mortgage Note and creating a lien on the related Mortgaged Property.
"Mortgage File": With respect to any Mortgage Loan, subject to Section
2.01(b), collectively the following documents:
(1) the original Mortgage Note, endorsed by the most recent endorsee prior
to the Trustee or, if none, by the originator, without recourse, in blank
or to the order of the Trustee in the following form: "Pay to the order of
LaSalle Bank National Association, as trustee for the registered holders of
GMAC Commercial Mortgage Securities, Inc., Mortgage Pass-Through
Certificates, Series 1999-C2, without recourse";
(2) the original or a copy of the Mortgage and, if applicable, the
originals or copies of any intervening assignments thereof showing a
complete chain of assignment from the originator of the Mortgage Loan to
the most recent assignee of record thereof prior to the Trustee, if any, in
each case with evidence of recording indicated thereon;
(3) an original assignment of the Mortgage, in recordable form, executed by
the most recent assignee of record thereof prior to the Trustee, or if none
by the originator, either in blank or in favor of the Trustee (in such
capacity);
(4) an original or copy of any related Assignment of Leases (if such item
is a document separate from the Mortgage) and, if applicable, the originals
or copies of any intervening assignments thereof showing a complete chain
of assignment from the originator of the Mortgage Loan to the most recent
assignee of record thereof prior to the Trustee, if any, in each case with
evidence of recording thereon;
(5) an original assignment of any related Assignment of Leases (if such
item is a document separate from the Mortgage), in recordable form,
executed by the most recent assignee of record thereof prior to the
Trustee, or, if none, by the originator, either in blank or in favor of the
Trustee (in such capacity), which assignment may be included as part of the
corresponding assignment of Mortgage, referred to in clause (3) above;
(6) an original or a copy of any related Security Agreement (if such item
is a document separate from the Mortgage) and, if applicable, the originals
or copies of any intervening assignments thereof showing a complete chain
of assignment from the originator of the Mortgage Loan to the most recent
assignee of record thereof prior to the Trustee, if any;
(7) an original assignment of any related Security Agreement (if such item
is a document separate from the Mortgage) executed by the most recent
assignee of record thereof prior to
32
the Trustee or, if none, by the originator, either in blank or in favor of
the Trustee (in such capacity), which assignment may be included as part of
the corresponding assignment of Mortgage referred to in clause (3) above;
(8) originals or copies of all assumption, modification, written assurance
and substitution agreements, with evidence of recording thereon, where
appropriate, in those instances where the terms or provisions of the
Mortgage, Mortgage Note or any related security document have been modified
or the Mortgage Loan has been assumed;
(9) the original or a copy of the lender's title insurance policy, together
with all endorsements or riders (or copies thereof) that were issued with
or subsequent to the issuance of such policy, insuring the priority of the
Mortgage as a first lien on the Mortgaged Property;
(10) the original or a copy of any guaranty of the obligations of the
Mortgagor under the Mortgage Loan which was in the possession of the
Mortgage Loan Seller at the time the Mortgage Files were delivered to the
Trustee together with (A) if applicable, the original or copies of any
intervening assignments of such guaranty showing a complete chain of
assignment from the originator of the Mortgage Loan to the most recent
assignee thereof prior to the Trustee, if any, and (B) an original
assignment of such guaranty executed by the most recent assignee thereof
prior to the Trustee or, if none, by the originator;
(11) (A) file or certified copies of any UCC financing statements and
continuation statements which were filed in order to perfect (and maintain
the perfection of) any security interest held by the originator of the
Mortgage Loan (and each assignee of record prior to the Trustee) in and to
the personalty of the Mortgagor at the Mortgaged Property (in each case
with evidence of filing thereon) and which were in the possession of the
Seller (or its agent) at the time the Mortgage Files were delivered and (B)
if any such security interest is perfected and the earlier UCC financing
statements and continuation statements were in the possession of the
Seller, a UCC financing statement executed by the most recent assignee of
record prior to the Trustee or, if none, by the originator, evidencing the
transfer of such security interest, either in blank or in favor of the
Trustee;
(12) the original or a copy of the power of attorney (with evidence of
recording thereon, if appropriate) granted by the Mortgagor if the
Mortgage, Mortgage Note or other document or instrument referred to above
was not signed by the Mortgagor;
(13) the related Ground Lease or a copy thereof, if any;
(14) if the Mortgage Loan is a Credit Lease Loan, an original of the credit
lease enhancement insurance policy, if any, obtained with respect to such
Mortgage Loan and an original of the residual value insurance policy, if
any, obtained with respect to such Mortgage Loan; and
33
(15) any additional documents required to be added to the Mortgage File
pursuant to this Agreement;
provided that, whenever the term "Mortgage File" is used to refer to documents
actually received by the Trustee or a Custodian appointed thereby, such term
shall not be deemed to include such documents and instruments required to be
included therein unless they are actually so received.
"Mortgage Loan": Each of the mortgage loans or interests therein
transferred and assigned to the Trustee pursuant to Section 2.01 and from time
to time held in the Trust Fund (including, without limitation, all Replacement
Mortgage Loans). As used herein, the term "Mortgage Loan" includes the related
Mortgage Note, Mortgage, participation certificate and/or other security
documents contained in the related Mortgage File.
"Mortgage Loan Purchase Agreement": With respect to any Mortgage Loan
Seller, the agreement between the Depositor and such Mortgage Loan Seller
relating to the transfer of all of such Mortgage Loan Seller's right, title and
interest in and to the Mortgage Loans.
"Mortgage Loan Schedule": The list of Mortgage Loans transferred on the
Closing Date to the Trustee as part of the Trust Fund, attached hereto as
Schedule I, which list sets forth the following information with respect to each
Mortgage Loan:
(i) the loan number;
(ii) the street address (including city, state and zip code) of the related
Mortgaged Property;
(iii) the (A) Mortgage Rate in effect as of the Cut-off Date and (B)
whether such Mortgage Loan is an Adjustable Rate Mortgage Loan or a Fixed
Rate Loan;
(iv) the original principal balance;
(v) the Cut-off Date Principal Balance;
(vi) the (A) remaining term to stated maturity, (B) with respect to each
ARD Loan, the Anticipated Repayment Date and (C) Stated Maturity Date;
(vii) the Due Date;
(viii) the amount of the Monthly Payment due on the first Due Date
following the Cutoff Date;
(ix) in the case of an Adjustable Rate Mortgage Loan, the (A) Index, (B)
Gross Margin, (C) first Mortgage Rate adjustment date following the Cut-off
Date and the frequency of Mortgage Rate adjustments, and (D) maximum and
minimum lifetime Mortgage Rate;
34
(x) whether such Mortgage Loan is an ARD Loan, a Credit Lease Loan or a
Defeasance Loan;
(xi) in the case of a Credit Lease Loan, the identity of the Tenant and the
Guarantor under any applicable Guaranty, and the publicly available
corporate credit ratings of such Tenant and Guarantor as of the Closing
Date; and
(xii) the Servicing Fee Rate.
Such schedule shall also set forth the aggregate Cut-off Date Principal Balance
for all of the Mortgage Loans. Such list may be in the form of more than one
list, collectively setting forth all of the information required.
"Mortgage Loan Seller": GMACCM and any other Person (other than the
Depositor) that is a party to a Mortgage Loan Purchase Agreement.
"Mortgage Note": The original executed note evidencing the indebtedness of
a Mortgagor under a Mortgage Loan, together with any rider, addendum or
amendment thereto.
"Mortgage Pool": Collectively, all of the Mortgage Loans (including any REO
Loans and Replacement Mortgage Loans, but excluding Deleted Mortgage Loans).
"Mortgage Rate": With respect to: (i) any Mortgage Loan on or prior to its
Maturity Date, the fixed or adjustable annualized rate (not including, in the
case of any ARD Loan, any increase in the rate of interest to the Revised Rate)
at which interest is scheduled (in the absence of a default) to accrue on such
Mortgage Loan from time to time in accordance with the terms of the related
Mortgage Note (as such may be modified at any time following the Closing Date)
and applicable law; (ii) any Mortgage Loan after its Maturity Date, the
annualized rate described in clause (i) above determined without regard to the
passage of such Maturity Date; and (iii) any REO Loan, the annualized rate
described in clause (i) or (ii), as applicable, above determined as if the
predecessor Mortgage Loan had remained outstanding.
"Mortgaged Property": Individually and collectively, as the context may
require, the real property interest subject to the lien of a Mortgage and
constituting collateral for a Mortgage Loan. With respect to any
Cross-Collateralized Mortgage Loan, as the context may require, "Mortgaged
Property" may mean, collectively, all the Mortgaged Properties securing such
Cross-Collateralized Mortgage Loan.
"Mortgagor": The obligor or obligors on a Mortgage Note, including without
limitation, any Person that has acquired the related Mortgaged Property and
assumed the obligations of the original obligor under the Mortgage Note.
"Net Aggregate Prepayment Interest Shortfall": With respect to any
Distribution Date, the amount, if any, by which (a) the aggregate of all
Prepayment Interest Shortfalls incurred
35
in connection with the receipt of Principal Prepayments on the Mortgage Loans
during the related Collection Period, exceeds (b) the aggregate amount deposited
by the Master Servicer in the Distribution Account for such Distribution Date
pursuant to Section 3.19(f) in connection with such Prepayment Interest
Shortfalls.
"Net Investment Earnings": With respect to any Investment Account for any
Collection Period, the amount, if any, by which the aggregate of all interest
and other income realized during such Collection Period on funds relating to the
Trust Fund held in such account, exceeds the aggregate of all losses, if any,
incurred during such Collection Period in connection with the investment of such
funds in accordance with Section 3.06.
"Net Investment Loss": With respect to any Investment Account for any
Collection Period, the amount by which the aggregate of all losses, if any,
incurred during such Collection Period in connection with the investment of
funds relating to the Trust Fund held in such account in accordance with Section
3.06, exceeds the aggregate of all interest and other income realized during
such Collection Period on such funds.
"Net Mortgage Rate": With respect to any Mortgage Loan or REO Loan, as of
any date of determination, a rate per annum equal to the related Mortgage Rate
then in effect, minus the Servicing Fee Rate, but, for purposes of calculating
the REMIC I Remittance Rate, the REMIC II Remittance Rate and Weighted Average
Net Mortgage Rate, determined without regard to any modification, waiver or
amendment of the terms of such Mortgage Loan, whether agreed to by the Master
Servicer or Special Servicer or resulting from (i) the bankruptcy, insolvency or
similar proceeding involving the related Mortgagor or (ii) the increase in the
interest rate attributable to the Revised Rate to any ARD Loan and, with respect
to any Mortgage Loan that does not accrue interest on the basis of a 360-day
year consisting of twelve 30-day months, the Net Mortgage Rate of such Mortgage
Loan for such purposes for any one-month preceding a related Due Date will be
the annualized rate at which interest would have to accrue in respect of such
loan on the basis of a 360-day year consisting of twelve 30-day months in order
to produce the aggregate amount of interest actually accrued in respect of such
loan during such one-month period at the related Mortgage Rate (net of the
related Servicing Fee Rate); provided, however, that with respect to the
Interest Reserve Loans, (i) the Net Mortgage Rate for the one-month period
preceding the Due Dates in (a) January of each calendar year that is not a leap
year and (b) February of each calendar year, will be determined net of the
Withheld Amounts and (ii) the Net Mortgage Rate for the one-month period
preceding the Due Dates in March of each calendar year will be determined after
taking into account the addition of the Withheld Amounts.
"Net Operating Income": With respect to any Mortgaged Property, for any
specified period, the net operating income calculated in accordance with Exhibit
G using the methodologies set forth in Exhibit F.
"Nonrecoverable Advance": Any Nonrecoverable Delinquency Advance or
Nonrecoverable Servicing Advance.
36
"Nonrecoverable Delinquency Advance": Any Delinquency Advance previously
made or proposed to be made in respect of a Mortgage Loan or REO Loan which, in
the judgment of the Master Servicer or, if applicable, the Trustee or Fiscal
Agent, will not be ultimately recoverable (together with Advance Interest
thereon) from late payments, Insurance Proceeds or Liquidation Proceeds, or any
other recovery on or in respect of such Mortgage Loan or REO Loan. The
determination by the Master Servicer or, if applicable, the Trustee, that it has
made a Nonrecoverable Delinquency Advance or that any proposed Delinquency
Advance, if made, would constitute a Nonrecoverable Delinquency Advance, shall
be evidenced by an Officer's Certificate delivered to the Depositor and
delivered to or retained by the Trustee, detailing a reasonable basis for such
determination. The Trustee shall be entitled to rely conclusively upon any such
Officer's Certificate of the Master Servicer.
"Nonrecoverable Servicing Advance": Any Servicing Advance previously made
or proposed to be made in respect of a Mortgage Loan or REO Property which, in
the judgment of the Master Servicer, the Special Servicer or, if applicable, the
Trustee or Fiscal Agent, will not be ultimately recoverable (together with
Advance Interest thereon) from late payments, Insurance Proceeds, Liquidation
Proceeds, or any other recovery on or in respect of such Mortgage Loan or REO
Property. The determination by the Master Servicer, the Special Servicer or, if
applicable, the Trustee or Fiscal Agent that it has made a Nonrecoverable
Servicing Advance or that any proposed Servicing Advance, if made, would
constitute a Nonrecoverable Servicing Advance, shall be evidenced by an
Officers' Certificate delivered to the Depositor and delivered to or retained by
the Trustee, detailing a reasonable basis for such determination. The Trustee
and the Fiscal Agent shall be entitled to rely conclusively upon any such
Officer's Certificate of the Master Servicer or the Special Servicer, and the
Master Servicer shall be entitled to rely conclusively upon such Officer's
Certificate of the Special Servicer.
"Non-Registered Certificate": Unless and until registered under the
Securities Act, any Class H, Class J, Class K, Class L, Class M, Class N or
Residual Certificate.
"Officer's Certificate": A certificate signed, as applicable, by a
Servicing Officer of the Master Servicer or the Special Servicer or by a
Responsible Officer of the Trustee.
"Opinion of Counsel": A written opinion of counsel, who may, without
limitation, be salaried counsel for the Depositor, the Master Servicer or the
Special Servicer, acceptable and delivered to the Trustee, except that any
opinion of counsel relating to (a) the qualification of REMIC I, REMIC II or
REMIC III as a REMIC or (b) compliance with the REMIC Provisions, must be an
opinion of counsel who is in fact Independent of the Depositor, the Master
Servicer and the Special Servicer.
"OTS": The Office of Thrift Supervision or any successor thereto.
"Ownership Interest": As to any Certificate, any ownership or security
interest in such Certificate as the Holder thereof may have and any other
interest therein, whether direct or indirect, legal or beneficial, as owner or
as pledgee.
37
"Pass-Through Rate": With respect to:
(1) the Class X Certificates, (a) for the initial Distribution Date 0.4144%
per annum, and (b) for any subsequent Distribution Date, the per annum
rate, expressed as a percentage, obtained by dividing (i) the sum of the
products of (a) the Uncertificated Principal Balance of each Class of REMIC
II Regular Interest immediately prior to such Distribution Date and (b) the
related Component Rate for such Distribution Date by (ii) the Class
Notional Amount; and
(2) the Class A-1 Certificates, for any Distribution Date, the fixed rate
per annum specified for such Class in the Preliminary Statement;
(3) the Class A-2, Class B, Class C, Class D, Class H, Class J, Class K,
Class L, Class M, and Class N Certificates, for any Distribution Date, the
lesser of the fixed rate per annum specified as such in the Preliminary
Statement and the Weighted Average Net Mortgage Rate; and
(4) the Class E, Class F and Class G Certificates, for any Distribution
Date, the Weighted Average Net Mortgage Rate.
"Payment Adjustment Date": With respect to each Adjustable Rate Mortgage
Loan, any date on which the related Monthly Payment is subject to adjustment
pursuant to the related Mortgage Note. The first Payment Adjustment Date
subsequent to the Cut-off Date for each Adjustable Rate Mortgage Loan is
specified in the Mortgage Loan Schedule, and successive Payment Adjustment Dates
for such Mortgage Loan shall thereafter periodically occur with the frequency
specified in the Mortgage Loan Schedule.
"Payment Priority": With respect to any Class of Certificates, the priority
of the Holders thereof in respect of the Holders of the other Classes of
Certificates to receive distributions out of the Available Distribution Amount
for any Distribution Date, as set forth in Section 4.01(c) hereof.
"Penalty Charges": With respect to any Mortgage Loan (or successor REO
Loan), any amounts collected thereon that represent late payment charges or
Default Interest.
"Percentage Interest": With respect to any REMIC III Regular Certificate,
the portion of the relevant Class evidenced by such Certificate, expressed as a
percentage, the numerator of which is the Certificate Principal Balance or the
Certificate Notional Amount of such Certificate as of the Closing Date, as
specified on the face thereof, and the denominator of which is the Initial Class
Principal Balance or Initial Class Notional Amount of the relevant Class. With
respect to a Residual Certificate, the percentage interest in distributions to
be made with respect to the relevant Class, as stated on the face of such
Certificate.
38
"Permitted Investments": Securities, instruments, or security entitlements
with respect to one or more of the following:
(1) obligations of or guaranteed as to principal and interest by the United
States or any agency or instrumentality thereof when such obligations are
backed by the full faith and credit of the United States;
(2) repurchase agreements on obligations specified in clause (i) maturing
not more than 30 days from the date of acquisition thereof, provided that
the unsecured obligations of the party agreeing to repurchase such
obligations are at the time rated by each Rating Agency in its highest
short-term rating available;
(3) federal funds, unsecured certificates of deposit, time deposits and
bankers' acceptances (which shall each have an original maturity of not
more than 90 days and, in the case of bankers' acceptances, shall in no
event have an original maturity of more than 365 days or a remaining
maturity of more than 30 days) denominated in United States dollars of any
U.S. depository institution or trust company incorporated under the laws of
the United States or any state thereof or of any domestic branch of a
foreign depository institution or trust company; provided that the
short-term debt obligations of such depository institution or trust company
(or, if the Rating Agency is Standard & Poor's, in the case of the
principal depository institution in a depository institution holding
company and in the case of LaSalle Bank National Association, the short
term debt obligations of the depository institution holding company) at all
times since the date of acquisition thereof have been rated by each Rating
Agency in its highest short-term rating available (or, if not rated by
FITCH IBCA, otherwise acceptable to FITCH IBCA as confirmed in writing that
such investment would not, in and of itself, result in a downgrade,
qualification or withdrawal of the then current rating assigned to any
Class of Certificates by such Rating Agency); and provided further that, if
the Rating Agency is Standard & Poor's and if the depository or trust
company is LaSalle Bank National Association or a principal subsidiary of a
bank holding company and the debt obligations of such subsidiary are not
separately rated, the applicable rating shall be that of the bank holding
company; and provided further that, if the original maturity of such
short-term obligations of a domestic branch of a foreign depository
institution or trust company shall exceed 30 days, the short-term rating of
such institution shall be A-1+ in the case of Standard & Poor's;
(4) commercial paper (having original maturities of not more than 365 days)
of any corporation incorporated under the laws of the United States or any
state thereof which on the date of acquisition has been rated by each
Rating Agency in its highest short-term rating available (or, if not rated
by FITCH IBCA, otherwise acceptable to FITCH IBCA as confirmed in writing
that such investment would not, in and of itself, result in a downgrade,
qualification or withdrawal of the then current rating assigned to any
Class of Certificates by such Rating Agency); provided that such commercial
paper shall have a remaining maturity of not more than 30 days;
39
(5) a money market fund rated by each Rating Agency in its highest rating
category;
(6) commercial paper of issuers rated by each Rating Agency in its highest
short-term rating available (or, if not rated by FITCH IBCA, otherwise
acceptable to FITCH IBCA as confirmed in writing that such investment would
not, in and of itself, result in a downgrade, qualification or withdrawal
of the then current rating assigned to any Class of Certificates by such
Rating Agency); provided that such obligations shall have a remaining
maturity of not more than 30 days and such obligations are limited to the
right to receive only monthly principal and interest payments;
(7) short-term debt obligations of issuers rated A-1 (or the equivalent) by
each Rating Agency (or, if not rated by FITCH IBCA, otherwise acceptable to
FITCH IBCA as confirmed in writing that such investment would not, in and
of itself, result in a downgrade, qualification or withdrawal of the then
current rating assigned to any Class of Certificates by such Rating Agency)
having a maturity of not more than 30 days; provided that the total amount
of such investment does not exceed the greater of (A) 20% of the then
outstanding principal balance of the Certificates, and (B) the amount of
monthly principal and interest payments (other than Balloon Payments)
payable on the Mortgage Loans during the preceding Collection Period;
provided, further, and notwithstanding the preceding proviso, that if all
of the Mortgage Loans are fully amortizing, then the amount of such
investment shall not exceed the amount of monthly principal and interest
payments (other than Balloon Payments) payable on the Mortgage Loans during
the preceding Collection Period;
(8) fully Federal Deposit Insurance Corporation-insured demand and time
deposits in, or certificates of deposit of, or bankers' acceptances issued
by, any bank or trust company, savings and loan association or savings
bank, the short term obligations of which are rated in the highest short
term rating category by each Rating Agency (or, if not rated by FITCH IBCA,
otherwise acceptable to FITCH IBCA as confirmed in writing that such
investment would not, in and of itself, result in a downgrade,
qualification or withdrawal of the then current rating assigned to any
Class of Certificates by such Rating Agency); and
(9) other obligations or securities that are acceptable to each Rating
Agency as a Permitted Investment hereunder and which would not result in
the downgrade, qualification or withdrawal of the then-current rating
assigned to any Class of Certificates by the Rating Agency, as evidenced in
writing;
provided, however, that no instrument shall be a Permitted Investment if it
represents, (1) the right to receive only interest payments with respect to the
underlying debt instrument, (2) the right to receive both principal and interest
payments derived from obligations underlying such instrument and the principal
and interest payments with respect to such instrument provide a yield to
maturity greater than 120% of the yield to maturity at par of such underlying
obligations, (3) an obligation that has a remaining maturity of greater than 365
days from the date of acquisition thereof. If an obligation is rated by Standard
& Poor's, then such obligation must be limited to those instruments that have a
predetermined fixed dollar of principal due at maturity that cannot vary or
change or, if
40
rated, the obligation should not have an "r" highlighter affixed to its rating,
and interest thereon may either be fixed or variable and should be tied to a
single interest rate index plus a single interest rate index plus a single fixed
spread (if any) and move proportionately with that index. References herein to
the highest rating available on money market funds shall mean AAAm in the case
of Standard & Poor's and Aaa in the case of Moody's and AAA in the case of FITCH
IBCA, and references herein to the highest rating available on unsecured
commercial paper and short-term debt obligations shall mean A-1+ in the case of
Standard & Poor's and P-1 in the case of Moody's and F-1+ in the case of FITCH
IBCA.
"Permitted Transferee": Any Transferee other than (i) the United States,
any State or political subdivision thereof, any possession of the United States,
or any agency or instrumentality of any of the foregoing (other than an
instrumentality which is a corporation if all of its activities are subject to
tax and, except for FHLMC, a majority of its board of directors is not selected
by such governmental unit), (ii) a foreign government, any international
organization, or any agency or instrumentality of any of the foregoing, (iii)
any organization (other than certain farmers' cooperatives described in Section
521 of the Code) which is exempt from the tax imposed by Chapter 1 of the Code
(including the tax imposed by Section 511 of the Code on unrelated business
taxable income), (iv) rural electric and telephone cooperatives described in
Section 1381(a)(2)(C) of the Code, (v) any electing large partnership under
Section 775 of the Code and (vi) any other Person so designated by the Trustee
based upon an Opinion of Counsel that the holding of an Ownership Interest in a
Residual Certificate by such Person may cause the Trust Fund or any Person
having an Ownership Interest in any Class of Certificates (other than such
Person) to incur a liability for any federal tax imposed under the Code that
would not otherwise be imposed but for the Transfer of an Ownership Interest in
a Residual Certificate to such Person. The terms "United States", "State" and
"international organization" shall have the meanings set forth in Section 7701
of the Code or successor provisions.
"Person": Any legal person, including, without limitation, any individual,
corporation, partnership, limited liability company, joint venture, association,
joint-stock company, trust, unincorporated organization or government or any
agency or political subdivision thereof.
"Plan": As defined in Section 5.02(c)(i).
"Preliminary Statement": The introductory section in this Agreement found
on pages 1 through 3 hereof.
"Prepayment Assumption": A CPR of 0% and an assumption that a Principal
Prepayment in full will be made on each ARD Loan on its Anticipated Repayment
Date, used for determining the accrual of original issue discount, market
discount and premium, if any, on the REMIC I Regular Interests, the REMIC II
Regular Interests and the Certificates for federal income tax purposes.
"Prepayment Interest Excess": With respect to any Mortgage Loan (other than
a Late Due Date Mortgage Loan) that was subject to a Principal Prepayment in
full or in part during any
41
Collection Period, which Principal Prepayment was received following such
Mortgage Loan's Due Date in such Collection Period, the amount of interest (net
of related Servicing Fees and, if applicable, Excess Interest) accrued on the
amount of such Principal Prepayment during the period from and after such Due
Date, to the extent collected (without regard to any Prepayment Premium that may
have been collected).
"Prepayment Interest Shortfall": With respect to any Mortgage Loan (other
than a Late Due Date Mortgage Loan) that was subject to a Principal Prepayment
in full or in part (including, without limitation, an early Balloon Payment)
during any Collection Period, which Principal Prepayment was received prior to
such Mortgage Loan's Due Date in such Collection Period, the amount of interest
that would have accrued at the related Net Mortgage Rate on the amount of such
Principal Prepayment during the period from the date as of which such Principal
Prepayment was applied to such Mortgage Loan to but not including such Due Date,
to the extent not collected from the related Mortgagor (without regard to any
Prepayment Premium or Excess Interest that may have been collected).
"Prepayment Premium": Any premium, penalty or fee paid or payable, as the
context requires, by a Mortgagor in connection with a Principal Prepayment on,
or other early collection of principal of, a Mortgage Loan or REO Loan.
"Primary Servicing Office": With respect to each of the Master Servicer and
the Special Servicer, the office thereof primarily responsible for performing
its respective duties under this Agreement; initially located in Illinois, in
the case of the Master Servicer, and California, in the case of the Special
Servicer.
"Principal Allocation Fraction": With respect to any Distribution Date and
each of Class A-1, Class A-2, Class B, Class C, Class D, Class E, Class F and
Class G Certificates, a fraction the numerator of which is the portion of the
Principal Distribution Amount allocable to such Class of Certificates for such
Distribution Date and the denominator of which is the Principal Distribution
Amount for all Classes of Certificates as of such Distribution Date.
"Principal Balance Certificate": Any REMIC III Regular Certificate other
than a Class X Certificate.
"Principal Distribution Amount": With respect to any Distribution Date, the
aggregate of (i) the Current Principal Distribution Amount for such Distribution
Date and (ii) if such Distribution Date is after the initial Distribution Date,
the excess, if any, of the Principal Distribution Amount for the preceding
Distribution Date, over the aggregate distributions of principal made on the
Principal Balance Certificates in respect of such Principal Distribution Amount
on the preceding Distribution Date.
"Principal Prepayment": Any payment of principal made by the Mortgagor on a
Mortgage Loan which is received in advance of its scheduled Due Date and which
is not
42
accompanied by an amount of interest representing scheduled interest due on any
date or dates in any month or months subsequent to the month of prepayment.
"Proposed Plan": As defined in Section 3.17(a)(iii).
"Prospectus": The Prospectus dated November 5, 1998, as supplemented by the
Prospectus Supplement dated May 25, 1999, relating to the offering of the
Registered Certificates.
"PTCE 95-60": As defined in Section 5.02(c)(ii).
"Purchase Price": With respect to any Mortgage Loan, a price equal to the
outstanding principal balance of such Mortgage Loan as of the date of purchase,
together with (a) all accrued and unpaid interest on such Mortgage Loan at the
related Mortgage Rate in effect from time to time to but not including the Due
Date in the Collection Period of purchase, (b) all related unreimbursed
Servicing Advances, (c) all accrued and unpaid interest in respect of related
Advances, and (d) if such Mortgage Loan is being purchased by a Mortgage Loan
Seller pursuant to Section 6 of the related Mortgage Loan Purchase Agreement or
by GMACCM pursuant to Section 4 of either Supplemental Agreement, all expenses
reasonably incurred or to be incurred by the Master Servicer (unless such
Mortgage Loan Seller is acting as Master Servicer), the Depositor and the
Trustee in respect of the Breach or Defect giving rise to the repurchase
obligation. With respect to any REO Property, the amount calculated in
accordance with the preceding sentence in respect of the related REO Loan.
"Qualified Appraiser": In connection with the appraisal of any Mortgaged
Property or REO Property, an Independent MAI-designated appraiser or, if a
MAI-designated appraiser is not reasonably available, a state certified
appraiser, in each case, with at least five (5) years experience in appraising
similar types of property.
"Qualified Insurer": An insurance company or security or bonding company
qualified to write the related Insurance Policy in the relevant jurisdiction.
"Qualifying Substitute Mortgage Loan" means, in the case of a Deleted
Mortgage Loan, a Mortgage Loan which, on the date of substitution, (i) has a
principal balance, after deduction of the principal portion of the Monthly
Payment due in the month of substitution, not in excess of the Stated Principal
Balance of the Deleted Mortgage Loan; (ii) is accruing interest at a rate of
interest at least equal to that of the Deleted Mortgage Loan; (iii) has a fixed
Mortgage Rate if the Deleted Mortgage Loan is a Fixed Rate Mortgage Loan and an
adjustable Mortgage Rate (with the same Index, Gross Margin and frequency of
Interest Rate Adjustment Dates and Payment Adjustment Dates as the Deleted
Mortgage Loan) if the Deleted Mortgage Loan is an Adjustable Rate Mortgage Loan;
(iv) is accruing interest on the same basis (for example, a 360- day year
consisting of twelve 30-day months) as the Deleted Mortgage Loan; (v) has a
remaining term to stated maturity or Anticipated Repayment Date, in the case of
an ARD Loan, not greater than, and not more than two years less than, that of
the Deleted Mortgage Loan; (vi) has an original Loan-to-Value Ratio not higher
than that of the Deleted Mortgage Loan and a current Loan-to-Value Ratio
43
(equal to the principal balance on the date of substitution divided by its
Appraised Value as determined by an Appraisal dated not more than twelve months
prior to the date of substitution) not higher than the then current
Loan-to-Value Ratio of the Deleted Mortgage Loan; (vii) will comply with all of
the representations and warranties relating to Mortgage Loans set forth in the
related Mortgage Loan Purchase Agreement, as of the date of substitution; (viii)
has an Environmental Assessment relating to the related Mortgaged Property in
its Servicing File; and (ix) as to which the Trustee has received an Opinion of
Counsel, at the related Seller's expense, that such Mortgage Loan is a
"qualified replacement mortgage" within the meaning of Section 860G(a)(4) of the
Code; provided that no Mortgage Loan may have a Maturity Date after the date
three years prior to the Rated Final Distribution Date, and provided, further,
that no such Mortgage Loan shall be substituted for a Deleted Mortgage Loan
unless Rating Agency Confirmation is obtained. In the event that either one
mortgage loan is substituted for more than one Deleted Mortgage Loan or more
than one mortgage loan is substituted for one or more Deleted Mortgage Loans,
then (a) the principal balance referred to in clause (i) above shall be
determined on the basis of aggregate principal balances and (b) the rates
referred to in clauses (ii) and (iii) above and the remaining term to stated
maturity referred to in clause (v) above shall be determined on a weighted
average basis. Whenever a Qualifying Substitute Mortgage Loan is substituted for
a Deleted Mortgage Loan pursuant to this Agreement, the party effecting such
substitution shall certify that such Mortgage Loan meets all of the requirements
of this definition and shall send such certification to the Trustee.
"Rated Final Distribution Date": The Distribution Date in September, 2033.
"Rating Agency": Each of Standard & Poor's, Xxxxx'x and FITCH IBCA.
"Rating Agency Confirmation": With respect to any matter and any Rating
Agency, where required under this Agreement, confirmation in writing by such
Rating Agency that a proposed action, failure to act, or other event specified
herein will not in and of itself result in the withdrawal, downgrade or
qualification of the rating assigned by such Rating Agency to any Class of
Certificates then rated by such Rating Agency. For all purposes of this
Agreement, the placement by a Rating Agency of any Class of Certificates on
"negative credit watch" shall constitute a qualification of such Rating Agency's
rating of such Certificates.
"Realized Loss": With respect to each defaulted Mortgage Loan as to which a
Final Recovery Determination has been made, or with respect to any REO Loan as
to which a Final Recovery Determination has been made as to the related REO
Property, an amount (not less than zero) equal to (i) the unpaid principal
balance of such Mortgage Loan or REO Loan, as the case may be, as of the Due
Date immediately preceding the date the Final Recovery Determination was made,
plus (ii) all accrued but unpaid interest on such Mortgage Loan or REO Loan, as
the case may be (without taking into account the amounts described in subclause
(iv) of this sentence), at the related Mortgage Rate to but not including the
Due Date in the Collection Period (or, in the case of a Late Due Date Mortgage
Loan, the Due Date in the Collection Period immediately following the Collection
Period) in which the Final Recovery Determination was made, plus (iii) any
related unreimbursed Servicing Advances as of the commencement of the Collection
Period in which the Final Recovery Determination was made, together with any new
related Servicing Advances made
44
during such Collection Period, minus (iv) all payments and proceeds, if any,
received in respect of such Mortgage Loan or REO Loan, as the case may be,
during the Collection Period in which such Final Recovery Determination was made
(net of any related Liquidation Expenses paid therefrom).
With respect to any Mortgage Loan as to which any portion of the
outstanding principal or accrued interest (other than Excess Interest) owed
thereunder was forgiven in connection with a bankruptcy or similar proceeding
involving the related Mortgagor or a modification, waiver or amendment of such
Mortgage Loan granted or agreed to by the Master Servicer or Special Servicer
pursuant to Section 3.20, the amount of such principal or interest so forgiven.
With respect to any Mortgage Loan as to which the Mortgage Rate thereon has
been permanently reduced for any period in connection with a bankruptcy or
similar proceeding involving the related Mortgagor or a modification, waiver or
amendment of such Mortgage Loan granted or agreed to by the Master Servicer or
Special Servicer pursuant to Section 3.20, the amount of the consequent
reduction in the interest portion of each successive Monthly Payment due
thereon. Each such Realized Loss shall be deemed to have been incurred on the
Due Date for each affected Monthly Payment.
"Record Date": With respect to any Distribution Date, the last Business Day
of the calendar month immediately preceding the month in which such Distribution
Date occurs.
"Registered Certificates": The Class X, Class A-1, Class A-2, Class B,
Class C, Class D, Class E, Class F and Class G Certificates.
"Related Borrower Group": Any of the groups of Mortgage Loans having the
same or related Mortgagors as identified in Annex A to the Prospectus Supplement
dated May 25, 1999 under the column heading "Related Group."
"Release Date": As defined in Section 3.08(c).
"Reimbursement Rate": The rate per annum applicable to the accrual of
Advance Interest, which rate per annum shall be equal to the "prime rate" as
published in the "Money Rates" section of The Wall Street Journal, as such
"prime rate" may change from time to time.
"REMIC": A "real estate mortgage investment conduit" as defined in Section
860D of the Code.
"REMIC I": The segregated pool of assets subject hereto, constituting the
primary trust created hereby and to be administered hereunder, with respect to
which a REMIC election is to be made, consisting of: (i) the Mortgage Loans as
from time to time are subject to this Agreement and all payments under and
proceeds of such Mortgage Loans received or receivable after the Cut-off Date
(other than (a) Excess Interest and (b) payments of principal, interest and
other amounts due and payable on the Mortgage Loans on or before the Cut-off
Date), together with the rights
45
under all documents delivered or caused to be delivered under the Mortgage Loan
Purchase Agreements with respect to the Mortgage Loans by the Mortgage Loan
Sellers; (ii) any REO Properties acquired in respect of the Mortgage Loans;
(iii) such funds or assets (other than Excess Interest) as from time to time are
deposited in the Distribution Account, the Certificate Account and the REO
Account (if established); and (iv) the rights of the Depositor under Sections 2,
4(a) and 6 of each Mortgage Loan Purchase Agreement and the rights of the
Depositor under Sections 2 and 4 of each Supplemental Agreement assigned by the
Depositor to the Trustee.
"REMIC I Regular Interest": With respect to each Mortgage Loan (and any
successor REO Loan), the separate non-certificated beneficial ownership interest
in REMIC I issued hereunder and designated as a "regular interest" in REMIC I.
Each REMIC I Regular Interest shall accrue interest at the related REMIC I
Remittance Rate and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance (which shall equal the Cut-off Date Principal
Balance of the related Mortgage Loan). The designation for each REMIC I Regular
Interest shall be the loan number for the initial related Mortgage Loan set
forth in the Mortgage Loan Schedule. If a Replacement Mortgage Loan or Loans are
substituted for any Deleted Mortgage Loan, the REMIC I Regular Interest that
related to the Deleted Mortgage Loan shall thereafter relate to such Replacement
Mortgage Loan(s).
"REMIC I Remittance Rate": With respect to any REMIC I Regular Interest for
any Distribution Date, a rate per annum equal to the Net Mortgage Rate in effect
for the related Mortgage Loan or REO Loan, as the case may be. If any Mortgage
Loan included in the Trust Fund as of the Closing Date is replaced by a
Replacement Mortgage Loan or Loans, the REMIC I Remittance Rate for the related
REMIC I Regular Interest shall still be calculated in accordance with the
preceding sentence based on the Net Mortgage Rate for the Deleted Mortgage Loan.
"REMIC II": The segregated pool of assets consisting of all of the REMIC I
Regular Interests, with respect to which a separate REMIC election is to be
made.
"REMIC II Distribution Amount": As defined in Section 4.01(a).
"REMIC II Regular Interest": Any of the fourteen (14) separate
non-certificated beneficial ownership interests in REMIC II issued hereunder
designated as a "regular interest" in REMIC II and identified individually as
REMIC II Regular Interests LA-1, LA-2, LB, LC, LD, LE, LF, LG, LH, LJ, LK, LL,
LM and LN. Each REMIC II Regular Interest shall accrue interest at the related
REMIC II Remittance Rate in effect from time to time and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto. The designations for the respective
REMIC II Regular Interests are set forth in the Preliminary Statement hereto.
Each REMIC II Regular Interest corresponds to a Class of Principal Balance
Certificates and a Class X Component as follows:
46
REMIC II Class of Principal Class X
Regular Interest Balance Certificates Component
---------------- -------------------- ---------
Class LA-1 Class A-1 Class LA-1 Component
Class LA-2 Class A-2 Class LA-2 Component
Class LB Class B Class LB Component
Class LC Class C Class LC Component
Class LD Class D Class LD Component
Class LE Class E Class LE Component
Class LF Class F Class LF Component
Class LG Class G Class LG Component
Class LH Class H Class LH Component
Class LJ Class J Class LJ Component
Class LK Class K Class LK Component
Class LL Class L Class LL Component
Class LM Class M Class LM Component
Class LN Class N Class LN Component
"REMIC II Remittance Rate": With respect to each REMIC II Regular Interest,
for any Distribution Date, the weighted average of the respective REMIC I
Remittance Rates for all REMIC I Regular Interests for such Distribution Date
(weighted on the basis of the respective Uncertificated Principal Balances of
the related REMIC I Regular Interests immediately prior to such Distribution
Date).
"REMIC III": The segregated pool of assets consisting of all of the REMIC
II Regular Interests, with respect to which a separate REMIC election is to be
made.
"REMIC III Certificate": Any Certificate, other than a Class R-I or Class
R-II Certificate.
"REMIC III Regular Certificate": Any REMIC III Certificate, other than a
Class R-III Certificate.
47
"REMIC Provisions": Provisions of the federal income tax law relating to
real estate mortgage investment conduits, which appear at Sections 860A through
860G of Subchapter M of Chapter 1 of the Code, and related provisions, and
temporary and final Treasury regulations (and, to the extent not inconsistent
with such temporary and final regulations, proposed regulations) and any
published rulings, notices and announcements, promulgated thereunder, as the
foregoing may be in effect from time to time.
"Rents from Real Property": With respect to any REO Property, gross income
of the character described in Section 856(d) of the Code, which income, subject
to the terms and conditions of that Section of the Code in its present form,
does not include:
(i) except as provided in Section 856(d)(4) or (6) of the Code, any
amount received or accrued, directly or indirectly, with respect to such
REO Property, if the determination of such amount depends in whole or in
part on the income or profits derived by any Person from such property
(unless such amount is a fixed percentage or percentages of receipts or
sales and otherwise constitutes Rents from Real Property);
(ii) any amount received or accrued, directly or indirectly, from any
Person if the Trust Fund owns directly or indirectly (including by
attribution) a ten percent or greater interest in such Person determined in
accordance with Sections 856(d)(2)(B) and (d)(5) of the Code;
(iii) any amount received or accrued, directly or indirectly, with
respect to such REO Property if any Person Directly Operates such REO
Property;
(iv) any amount charged for services that are not customarily
furnished in connection with the rental of property to tenants in buildings
of a similar class in the same geographic market as such REO Property
within the meaning of Treasury Regulations Section 1.856-4(b)(1) (whether
or not such charges are separately stated); and
(v) rent attributable to personal property unless such personal
property is leased under, or in connection with, the lease of such REO
Property and, for any taxable year of the Trust Fund, such rent is no
greater than 15 percent of the total rent received or accrued under, or in
connection with, the lease.
"REO Account": A segregated account or accounts created and maintained by
the Special Servicer pursuant to Section 3.16(b) on behalf of the Trustee in
trust for the Certificateholders, which shall be entitled "GMAC Commercial
Mortgage Corporation, as Special Servicer, in trust for registered holders of
GMAC Commercial Mortgage Securities, Inc., Mortgage Pass-Through Certificates,
Series 1999-C2".
"REO Acquisition": The acquisition of any REO Property pursuant to Section
3.09.
48
"REO Disposition": The sale or other disposition of the REO Property
pursuant to Section 3.18.
"REO Extension": As defined in Section 3.16(a).
"REO Loan": The mortgage loan deemed for purposes hereof to be outstanding
with respect to each REO Property. Each REO Loan shall be deemed to provide for
monthly payments of principal and/or interest equal to the applicable Assumed
Monthly Payment and otherwise to have the same terms and conditions as its
predecessor Mortgage Loan, including, without limitation, with respect to the
calculation of the Mortgage Rate in effect from time to time (such terms and
conditions to be applied without regard to the default on such predecessor
Mortgage Loan). Each REO Loan shall be deemed to have an initial outstanding
principal balance and Stated Principal Balance equal to the outstanding
principal balance and Stated Principal Balance, respectively, of its predecessor
Mortgage Loan as of the date of the related REO Acquisition. All Monthly
Payments (other than a Balloon Payment), Assumed Monthly Payments and other
amounts due and owing in respect of the predecessor Mortgage Loan as of the date
of the related REO Acquisition shall be deemed to continue to be due and owing
in respect of an REO Loan. All amounts payable or reimbursable to the Master
Servicer, the Special Servicer, the Trustee or the Fiscal Agent in respect of
the predecessor Mortgage Loan as of the date of the related REO Acquisition,
including, without limitation, any unreimbursed Advances, together with any
Advance Interest accrued and payable in respect of such Advances, shall continue
to be payable or reimbursable to the Master Servicer, the Special Servicer, the
Trustee or the Fiscal Agent, as the case may be, in respect of an REO Loan.
"REO Property": A Mortgaged Property acquired by the Special Servicer on
behalf and in the name of the Trustee for the benefit of the Certificateholders
through foreclosure, acceptance of a deed-in-lieu of foreclosure or otherwise in
accordance with applicable law in connection with the default or imminent
default of a Mortgage Loan.
"REO Revenues": All income, rents and profits derived from the ownership,
operation or leasing of any REO Property.
"REO Status Report": A report or reports substantially in the form of
Exhibit H attached hereto setting forth, among other things, with respect to
each REO Property that was included in the Trust Fund as of the close of
business on the immediately preceding Determination Date, (i) the Acquisition
Date of such REO Property, (ii) the amount of income collected with respect to
such REO Property (net of related expenses) and other amounts, if any, received
on such REO Property during the Collection Period ending on such Determination
Date and (iii) the value of the REO Property based on the most recent Appraisal
or other valuation thereof available to the Master Servicer as of such date of
determination (including any valuation prepared internally by the Special
Servicer).
"REO Tax": As defined in Section 3.17(a)(i).
49
"Replacement Mortgage Loan": Any Qualifying Substitute Mortgage Loan that
is substituted for one or more Deleted Mortgage Loans.
"Request for Release": A release signed by a Servicing Officer, in the form
of Exhibit D attached hereto.
"Required Appraisal Loan": As defined in Section 3.19(d).
"Reserve Account": The account or accounts created and maintained pursuant
to Section 3.03(d).
"Reserve Funds": With respect to any Mortgage Loan, any cash amounts or
instruments convertible into cash delivered by the related Mortgagor to be held
in escrow by or on behalf of the mortgagee representing reserves for items such
as repairs, replacements, capital improvements and/or environmental testing and
remediation with respect to the related Mortgaged Property.
"Residual Certificate": Any Class R-I, Class R-II or Class R-III
Certificate.
"Responsible Officer": When used with respect to the initial Trustee, any
officer of its Asset-Backed Securities Trust Services Group with direct
responsibility for the transaction contemplated by this Agreement and with
respect to any successor Trustee, any vice president, any assistant vice
president, any assistant secretary, any assistant treasurer, any trust officer
or assistant trust officer, or any assistant controller in its corporate trust
department or any other officer of the Trustee customarily performing functions
similar to those performed by any of the above designated officers to whom a
particular matter is referred by the Trustee because of such officer's knowledge
of and familiarity with the particular subject.
"Revised Rate": With respect to each ARD Loan, the increased interest rate
after the Anticipated Repayment Date (in the absence of a default) for such ARD
Loan, as calculated and as set forth in the related Mortgage Note or Mortgage.
"Securities Act": The Securities Act of 1933, as amended.
"Security Agreement": With respect to any Mortgage Loan, any security
agreement or equivalent instrument, whether contained in the related Mortgage or
executed separately, creating in favor of the holder of such Mortgage a security
interest in the personal property constituting security for repayment of such
Mortgage Loan.
"Senior Certificate": Any Class X, Class A-1 or Class A-2 Certificate.
"Servicer Watch List": A report or reports setting forth, among other
things, certain Mortgage Loans that (i) have experienced a decrease of at least
10% in debt service coverage from the previous reporting period (unless the
Master Servicer shall have reasonably determined that such
50
decrease is due to the seasonal nature or use of the related Mortgaged
Property), (ii) have experienced a loss of or bankruptcy of the largest tenant
(to the extent the Servicer has actual knowledge of such loss or bankruptcy) or
(iii) are within six months of maturity.
"Servicing Account": The account or accounts created and maintained
pursuant to Section 3.03(a).
"Servicing Advances": All customary, reasonable and necessary "out of
pocket" costs and expenses (including attorneys' fees and expenses and fees of
real estate brokers) incurred by the Master Servicer, the Special Servicer or,
if applicable, the Trustee or the Fiscal Agent in connection with the servicing
and administering of (a) a Mortgage Loan in respect of which a default,
delinquency or other unanticipated event has occurred or as to which a default
is imminent or (b) an REO Property, including, but not limited to, the cost of
(i) compliance with the obligations of the Master Servicer and/or the Special
Servicer set forth in Section 3.03(c) and 3.09(c), (ii) the preservation,
restoration and protection of a Mortgaged Property, (iii) obtaining any
Insurance Proceeds or any Liquidation Proceeds in respect of any Mortgage Loan
or REO Property, (iv) any enforcement or judicial proceedings with respect to a
Mortgaged Property, including foreclosures, and (v) the operation, management,
maintenance and liquidation of any REO Property. All Emergency Advances made by
the Special Servicer hereunder shall be considered "Servicing Advances" for the
purposes hereof.
"Servicing Fee Rate": With respect to any Mortgage Loan, the percentage
rate per annum set forth with respect to such Mortgage Loan on the Mortgage Loan
Schedule.
"Servicing Fees": With respect to each Mortgage Loan and REO Loan, the
Master Servicing Fee and the Trustee Fee.
"Servicing Officer": Any officer of the Master Servicer or the Special
Servicer involved in, or responsible for, the administration and servicing of
the Mortgage Loans, whose name and specimen signature appear on a list of
servicing officers furnished by the Master Servicer or the Special Servicer to
the Trustee and the Depositor on the Closing Date as such list may be amended
from time to time thereafter.
"Servicing Return Date": With respect to any Corrected Mortgage Loan, the
date that servicing thereof is returned by the Special Servicer to the Master
Servicer pursuant to Section 3.21(a).
"Servicing Standard": As defined in Section 3.01(a).
"Servicing Transfer Event": With respect to any Mortgage Loan, the
occurrence of any of the events described in clauses (1) through (8) of the
definition of "Specially Serviced Mortgage Loan".
51
"Special Servicer": GMACCM, or any successor special servicer appointed as
herein provided.
"Special Servicing Fee": With respect to each Specially Serviced Mortgage
Loan and REO Loan, the fee designated as such and payable to the Special
Servicer pursuant to Section 3.11(c).
"Special Servicing Fee Rate": With respect to each Specially Serviced
Mortgage Loan and REO Loan, 0.250% per annum.
"Specially Serviced Mortgage Loan": Any Mortgage Loan (and each related
Cross- Collateralized Mortgage Loan) as to which any of the following events has
occurred:
(1) the related Mortgagor has failed to make when due any Balloon Payment,
which failure has continued unremedied for 30 days; or
(2) the related Mortgagor has failed to make when due any Monthly Payment
(other than a Balloon Payment) or any other payment required under the
related Mortgage Note or the related Mortgage, which failure continues
unremedied for 60 days; or
(3) the Master Servicer has determined in its good faith and reasonable
judgment, that a default in the making of a Monthly Payment or any other
payment required under the related Mortgage Note or the related Mortgage is
likely to occur within 30 days and is likely to remain unremedied for at
least 60 days or, in the case of a Balloon Payment, for at least 30 days;
or
(4) there shall have occurred a default, other than as described in clause
(1) or (2) above, that materially impairs the value of the related
Mortgaged Property as security for the Mortgage Loan or otherwise
materially and adversely affects the interests of Certificateholders, which
default has continued unremedied for the applicable grace period under the
terms of the Mortgage Loan (or, if no grace period is specified, 60 days);
or
(5) a decree or order of a court or agency or supervisory authority having
jurisdiction in the premises in an involuntary case under any present or
future federal or state bankruptcy, insolvency or similar law or the
appointment of a conservator or receiver or liquidator in any insolvency,
readjustment of debt, marshalling of assets and liabilities or similar
proceedings, or for the winding-up or liquidation of its affairs, shall
have been entered against the related Mortgagor and such decree or order
shall have remained in force undischarged or unstayed for a period of 60
days; or
(6) the related Mortgagor shall have consented to the appointment of a
conservator or receiver or liquidator in any insolvency, readjustment of
debt, marshalling of assets and liabilities or similar proceedings of or
relating to such Mortgagor or of or relating to all or substantially all of
its property; or
52
(7) the related Mortgagor shall have admitted in writing its inability to
pay its debts generally as they become due, filed a petition to take
advantage of any applicable insolvency or reorganization statute, made an
assignment for the benefit of its creditors, or voluntarily suspended
payment of its obligations; or
(8) the Master Servicer shall have received notice of the commencement of
foreclosure or similar proceedings with respect to the related Mortgaged
Property;
provided that a Mortgage Loan will cease to be a Specially Serviced Mortgage
Loan, when a Liquidation Event has occurred in respect of such Mortgage Loan,
when the related Mortgaged Property or Properties become REO Property or
Properties, or at such time as such of the following as are applicable occur
with respect to the circumstances identified above that caused the Mortgage Loan
to be characterized as a Specially Serviced Mortgage Loan (and provided that no
other Servicing Transfer Event then exists with respect to the particular
Mortgage Loan or any related Cross-Collateralized Mortgage Loan):
(w) with respect to the circumstances described in clauses (1) and (2)
above, the related Mortgagor has made three consecutive full and timely
Monthly Payments under the terms of such Mortgage Loan (as such terms may
be changed or modified in connection with a bankruptcy or similar
proceeding involving the related Mortgagor or by reason of a modification,
waiver or amendment granted or agreed to by the Special Servicer pursuant
to Section 3.20);
(x) with respect to the circumstances described in clauses (3), (5),
(6) and (7) above, such circumstances cease to exist in the good faith and
reasonable judgment of the Special Servicer;
(y) with respect to the circumstances described in clause (4) above,
such default is cured; and
(z) with respect to the circumstances described in clause (8) above,
such proceedings are terminated.
"Standard & Poor's": Standard & Poor's Ratings Services, a division of The
XxXxxx-Xxxx Companies, Inc. or its successor in interest. If neither such rating
agency nor any successor remains in existence, "Standard & Poor's" shall be
deemed to refer to such other nationally recognized statistical rating agency or
other comparable Person designated by the Depositor, notice of which designation
shall be given to the Trustee, the Fiscal Agent, the Master Servicer, and the
Special Servicer, and specific ratings of Standard & Poor's Rating Services, a
division of The XxXxxx-Xxxx Companies, Inc. herein referenced shall be deemed to
refer to the equivalent ratings of the party so designated.
"Startup Day": With respect to each of REMIC I, REMIC II and REMIC III, the
day designated as such in Section 10.01(b).
53
"Stated Maturity Date": With respect to any Mortgage Loan, the Due Date on
which the last payment of principal is due and payable under the terms of the
related Mortgage Note as in effect on the Closing Date, without regard to any
change in or modification of such terms in connection with a bankruptcy or
similar proceeding involving the related Mortgagor or a modification, waiver or
amendment of such Mortgage Loan granted or agreed to by the Master Servicer or
Special Servicer pursuant to Section 3.20 or, in the case of any ARD Loan, the
Anticipated Repayment Date for such Mortgage Loan.
"Stated Principal Balance": With respect to any Mortgage Loan (and any
related REO Loan), the Cut-off Date Principal Balance of such Mortgage Loan (or
in the case of a Replacement Mortgage Loan, as of the related date of
substitution), as reduced on each Distribution Date (to not less than zero) by
(i) all payments (or Delinquency Advances in lieu thereof) of, and all other
collections allocated as provided in Section 1.02 to, principal of or with
respect to such Mortgage Loan (or related REO Loan) that are (or, if they had
not been applied to cover any Additional Trust Fund Expense, would have been)
distributed to Certificateholders on such Distribution Date, and (ii) the
principal portion of any Realized Loss incurred in respect of such Mortgage Loan
(or related REO Loan) during the related Collection Period. Notwithstanding the
foregoing, if a Liquidation Event occurs in respect of any Mortgage Loan or REO
Property, then the "Stated Principal Balance" of such Mortgage Loan or of the
related REO Loan, as the case may be, shall be zero commencing as of the
Distribution Date in the Collection Period next following the Collection Period
in which such Liquidation Event occurred.
"Subordinated Certificate": Any Class B, Class C, Class D, Class E, Class
F, Class G, Class H, Class J, Class K, Class L, Class M, Class N or Residual
Certificate.
"Substitution Shortfall Amount": In connection with the substitution of one
or more Replacement Mortgage Loans for one or more Deleted Mortgage Loans, the
amount, if any, by which the Purchase Price or aggregate Purchase Price, as the
case may be, for such Deleted Mortgage Loan(s) exceeds the initial Stated
Principal Balance or aggregate Stated Principal Balance, as the case may be, of
such Replacement Mortgage Loan(s).
"Sub-Servicer": Any Person with which the Master Servicer or the Special
Servicer has entered into a Sub-Servicing Agreement.
"Sub-Servicing Agreement": The written contract between the Master Servicer
or the Special Servicer and any Sub-Servicer relating to servicing and
administration of Mortgage Loans as provided in Section 3.22.
"Supplemental Agreement": Each of (i) the Supplemental Agreement dated as
of May 25, 1999 between GMACCM and Xxxxxxx Xxxxx Mortgage Company, (ii) the
Supplemental Agreement dated as of May 25, 1999 between GMACCM and Column
Financial, Inc. and (iii) the Supplemental Agreement dated as of May 25, 1999
between GMACCM and German American Capital Corporation, in each case, as
amended, restated or otherwise supplemented from time to time.
54
"Tax Returns": The federal income tax return on Internal Revenue Service
Form 1066, U.S. Real Estate Mortgage Investment Conduit Income Tax Return,
including Schedule Q thereto, Quarterly Notice to Residual Interest Holders of
REMIC Taxable Income or Net Loss Allocation, or any successor forms, to be filed
on behalf of each of REMIC I, REMIC II and REMIC III due to its classification
as a REMIC under the REMIC Provisions, and the federal income tax return to be
filed on behalf of the Grantor Trust due to its classification as a grantor
trust under the Grantor Trust Provisions, together with any and all other
information, reports or returns that may be required to be furnished to the
Certificateholders or filed with the Internal Revenue Service or any other
governmental taxing authority under any applicable provisions of federal, or
Applicable State Law.
"Tenant": With respect to each Credit Lease Loan, the lessee thereunder.
"Transfer": Any direct or indirect transfer, sale, pledge, hypothecation,
or other form of assignment of any Ownership Interest in a Certificate.
"Transfer Affidavit and Agreement": As defined in Section 5.02(d)(i)(B).
"Transferee": Any Person who is acquiring by Transfer any Ownership
Interest in a Certificate.
"Transferor": Any Person who is disposing by Transfer any Ownership
Interest in a Certificate.
"Trust Fund": Collectively, the Excess Interest and all of the assets of
REMIC I, REMIC II and REMIC III.
"Trustee": LaSalle Bank National Association, in its capacity as Trustee
under this Agreement, its successor in interest, or any successor trustee
appointed as herein provided.
"Trustee Fee": With respect to any Distribution Date and each Mortgage Loan
and REO Loan, an amount equal to one-twelfth of the product of the Trustee Fee
Rate and the aggregate Stated Principal Balance of such Mortgage Loan or REO
Loan immediately following the prior Distribution Date.
"Trustee Fee Rate": 0.0025%.
"UCC": The Uniform Commercial Code of any applicable jurisdiction.
"UCC Financing Statement": A financing statement executed and filed
pursuant to the Uniform Commercial Code, as in effect in the relevant
jurisdiction, or, in the case of Louisiana, the comparable provisions of
Louisiana law.
55
"Uncertificated Accrued Interest": With respect to any REMIC I Regular
Interest, for any Distribution Date, one month's interest (calculated on the
basis of a 360 day year consisting of twelve 30-day months) at the REMIC I
Remittance Rate applicable to such REMIC I Regular Interest for such
Distribution Date, accrued on the Uncertificated Principal Balance of such REMIC
I Regular Interest outstanding immediately prior to such Distribution Date. With
respect to any REMIC II Regular Interest, for any Distribution Date, one month's
interest (calculated on the basis of a 360-day year consisting of twelve 30-day
months) at the REMIC II Remittance Rate applicable to such REMIC II Regular
Interest for such Distribution Date, accrued on the Uncertificated Principal
Balance of such REMIC II Regular Interest outstanding immediately prior to such
Distribution Date. The Uncertificated Accrued Interest in respect of any REMIC I
Regular Interest or REMIC II Regular Interest for any Distribution Date shall be
deemed to accrue during the applicable Interest Accrual Period.
"Uncertificated Distributable Interest": With respect to any REMIC I
Regular Interest for any Distribution Date, the Uncertificated Accrued Interest
in respect of such REMIC I Regular Interest for such Distribution Date, reduced
(to not less than zero) by the product of (i) any Net Aggregate Prepayment
Interest Shortfall for such Distribution Date, multiplied by (ii) a fraction,
expressed as a percentage, the numerator of which is the Uncertificated Accrued
Interest in respect of such REMIC I Regular Interest for such Distribution Date,
and the denominator of which is the aggregate Uncertificated Accrued Interest in
respect of all the REMIC I Regular Interests for such Distribution Date. With
respect to any REMIC II Regular Interest for any Distribution Date, an amount
equal to: (a) the Uncertificated Accrued Interest in respect of such REMIC II
Regular Interest for such Distribution Date; reduced (to not less than zero) by
(b) the portion, if any, of the Net Aggregate Prepayment Interest Shortfall, if
any, for such Distribution Date allocated to such REMIC II Regular Interest
which shall be allocated in the same manner as such Net Aggregate Prepayment
Interest Shortfall is allocated amongst the corresponding REMIC III Regular
Certificates.
"Uncertificated Principal Balance": The principal amount of any REMIC I
Regular Interest or REMIC II Regular Interest outstanding as of any date of
determination. As of the Closing Date, the Uncertificated Principal Balance of
each REMIC I Regular Interest shall equal the Cut-off Date Principal Balance of
the related Mortgage Loan. On each Distribution Date, the Uncertificated
Principal Balance of each REMIC I Regular Interest shall be reduced by all
distributions of principal deemed to have been made thereon on such Distribution
Date pursuant to Section 4.01(a) and, if and to the extent appropriate, shall be
further reduced on such Distribution Date as provided in Section 4.04(a). As of
the Closing Date, the Uncertificated Principal Balance of each REMIC II Regular
Interest shall equal the amount set forth in the Preliminary Statement hereto as
its initial Uncertificated Principal Balance. On each Distribution Date, the
Uncertificated Principal Balance of each such REMIC II Regular Interest shall be
reduced by all distributions of principal deemed to have been made thereon on
such Distribution Date pursuant to Section 4.01(b) and, if and to the extent
appropriate, shall be further reduced on such Distribution Date as provided in
Section 4.04(b).
"Underwriter": Each of Xxxxxxx, Sachs & Co., Deutsche Bank Securities Inc.
and Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation.
56
"Uninsured Cause": Any cause of damage to property subject to a Mortgage
such that the complete restoration of such property is not fully reimbursable by
the hazard insurance policies or flood insurance policies required to be
maintained pursuant to Section 3.07.
"United States Person": A citizen or resident of the United States, a
corporation, partnership or other entity created or organized in, or under the
laws of, the United States or any political subdivision thereof (except, in the
case of a partnership, to the extent provided in Treasury regulations), an
estate whose income from sources without the United States is includible in
gross income for United States federal income tax purposes regardless of its
connection with the conduct of a trade or business within the United States, or
a trust for which a court within the United States is able to exercise primary
supervision over its administration and for which one or more United States
Persons have the authority to control all substantial decisions of the trust.
"USPAP": The Uniform Standards of Professional Appraisal Practices.
"Voting Rights": The portion of the voting rights of all of the
Certificates which is allocated to any Certificate. At all times during the term
of this Agreement, 98% of the Voting Rights shall be allocated among the Holders
of the various outstanding Classes of Principal Balance Certificates in
proportion to the respective Class Principal Balances of their Certificates, 1%
of the Voting Rights shall be allocated among the Holders of the Class X
Certificates in proportion to the respective Class Notional Amount of such
Certificates, and the remaining Voting Rights shall be allocated equally among
the Holders of the respective Classes of the Residual Certificates. Voting
Rights allocated to a Class of Certificateholders shall be allocated among such
Certificateholders in proportion to the Percentage Interests evidenced by their
respective Certificates. Appraisal Reduction Amounts will be allocated in
reduction of the respective Certificate Balances of the Class N, Class M, Class
L, Class K, Class J, Class H, Class G, Class F, Class E, Class D, Class C, Class
B and Class A Certificates (pro rata between the Class A-1 and Class A-2
Certificates), in that order, for purposes of calculating Voting Rights.
"Weighted Average Net Mortgage Rate": With respect to any Distribution
Date, the REMIC II Remittance Rate for each REMIC II Regular Interest for such
Determination Date.
"Withheld Amount": With respect to (a) each Interest Reserve Loan and (b)
each Distribution Date occurring in (i) January of each calendar year that is
not a leap year and (ii) February of each calendar year, an amount equal to one
day's interest at the related Mortgage Rate (less any Servicing Fee payable
therefrom) on the respective Stated Principal Balance as of the Due Date in the
month in which such Distribution Date occurs, to the extent that a Monthly
Payment or Delinquency Advance is made in respect thereof.
"Workout Fee": With respect to each Corrected Mortgage Loan, the fee
designated as such and payable to the Special Servicer pursuant to the third
paragraph of Section 3.11(c).
"Workout Fee Rate": With respect to each Corrected Mortgage Loan as to
which a Workout Fee is payable, 1.00%.
57
SECTION 1.02 Certain Calculations in Respect of the Mortgage Pool.
(a) All amounts collected in respect of any group of related
Cross-Collateralized Mortgage Loans in the form of payments from Mortgagors,
Insurance Proceeds and Liquidation Proceeds, shall be applied by the Master
Servicer among such Mortgage Loans in accordance with the express provisions of
the related loan documents and, in the absence of such express provisions, on a
pro rata basis in accordance with the respective amounts then "due and owing" as
to each such Mortgage Loan. All amounts collected in respect of any Mortgage
Loan (whether or not such Mortgage Loan is a Cross-Collateralized Mortgage Loan)
in the form of payments from Mortgagors, Liquidation Proceeds or Insurance
Proceeds shall be applied to amounts due and owing under the related Mortgage
Note and Mortgage (including, without limitation, for principal and accrued and
unpaid interest) in accordance with the express provisions of the related
Mortgage Note and Mortgage and, in the absence of such express provisions, shall
be applied for purposes of this Agreement: first, as a recovery of any related
unreimbursed Servicing Advances and, if applicable, unpaid Liquidation Expenses;
second, as a recovery of accrued and unpaid interest at the related Mortgage
Rate on such Mortgage Loan to but not including, as appropriate, the date of
receipt or, in the case of a full Monthly Payment from any Mortgagor, the
related Due Date; third, as a recovery of principal of such Mortgage Loan then
due and owing, including, without limitation, by reason of acceleration of the
Mortgage Loan following a default thereunder (or, if a Liquidation Event has
occurred in respect of such Mortgage Loan, as a recovery of principal to the
extent of its entire remaining unpaid principal balance); fourth, as a recovery
of amounts to be currently applied to the payment of, or escrowed for the future
payment of, real estate taxes, assessments, insurance premiums, ground rents (if
applicable) and similar items; fifth, as a recovery of Reserve Funds to the
extent then required to be held in escrow; sixth, as a recovery of any
Prepayment Premium then due and owing under such Mortgage Loan; seventh, as a
recovery of any Penalty Charges then due and owing under such Mortgage Loan;
eighth, as a recovery of any other amounts (other than Excess Interest) then due
and owing under such Mortgage Loan; ninth, as a recovery of any remaining
principal of such Mortgage Loan to the extent of its entire remaining unpaid
principal balance; and tenth, if such Mortgage Loan is an ARD Loan, as a
recovery of any Excess Interest then due and owing on such Mortgage Loan.
(b) Collections in respect of each REO Property (exclusive of amounts to be
applied to the payment of the costs of operating, managing, maintaining and
disposing of such REO Property) shall be treated: first, as a recovery of any
related unreimbursed Servicing Advances; second, as a recovery of accrued and
unpaid interest on the related REO Loan at the related Mortgage Rate to but not
including the Due Date in the month of receipt; third, as a recovery of
principal of the related REO Loan to the extent of its entire unpaid principal
balance; and fourth, as a recovery of any other amounts deemed to be due and
owing in respect of the related REO Loan.
(c) The foregoing applications of amounts received in respect of any
Mortgage Loan or REO Property shall be determined by the Master Servicer in its
good faith judgment.
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ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
SECTION 2.01 Establishment of Trust; Conveyance of Mortgage Loans.
(a) The Depositor, concurrently with the execution and delivery hereof,
does hereby establish a trust, appoint the Trustee to serve as trustee of such
trust and assign to the Trustee without recourse for the benefit of the
Certificateholders all the right, title and interest of the Depositor, including
any security interest therein for the benefit of the Depositor, in, to and under
(i) the Mortgage Loans identified on the Mortgage Loan Schedule, (ii) Sections
2, 4(a), 6 and 13 of each Mortgage Loan Purchase Agreement and Sections 2, 4 and
6 of each Supplemental Agreement and (iii) all other assets included or to be
included in REMIC I. Such assignment includes all interest and principal
received or receivable on or with respect to the Mortgage Loans (other than
payments of principal and interest due and payable on the Mortgage Loans on or
before the Cut-off Date). The transfer of the Mortgage Loans and the related
rights and property accomplished hereby is absolute and, notwithstanding Section
11.07, is intended by the parties to constitute a sale.
(b) In connection with the Depositor's assignment pursuant to subsection
(a) above, the Depositor shall direct, and hereby represents and warrants that
it has directed, each Mortgage Loan Seller pursuant to the related Mortgage Loan
Purchase Agreement to deliver to and deposit with, or cause to be delivered to
and deposited with, the Trustee or the Custodian (with a copy to the Master
Servicer), on or before the Closing Date, the Mortgage File for each of such
Mortgage Loan Seller's Mortgage Loans so assigned. If the related Mortgage Loan
Seller cannot deliver, or cause to be delivered as to any Mortgage Loan, the
original Mortgage Note, the Mortgage Loan Seller shall deliver a copy or
duplicate original of such Mortgage Note, together with an affidavit certifying
that the original thereof has been lost or destroyed. If the related Mortgage
Loan Seller cannot deliver, or cause to be delivered, as to any Mortgage Loan,
any of the documents and/or instruments referred to in clauses (2), (4), (11)
and (12) of the definition of "Mortgage File", with evidence of recording or
filing, as the case may be, thereon, because of a delay caused by the public
recording or filing office where such document or instrument has been delivered
for recordation or filing, or because such original recorded document has been
lost or returned from the recording or filing office and subsequently lost, as
the case may be, the delivery requirements of the related Mortgage Loan Purchase
Agreement and this Section 2.01(b) shall be deemed to have been satisfied as to
such missing document or instrument, and such missing document or instrument
shall be deemed to have been included in the Mortgage File, provided that a
photocopy of such missing document or instrument (certified by the related
Mortgage Loan Seller to be a true and complete copy of the original thereof
submitted for recording or filing, as the case may be) is delivered to the
Trustee or a Custodian appointed thereby on or before the Closing Date and
either the original of such missing document or instrument, or a copy thereof,
with evidence of recording or filing, as the case may be, thereon, is delivered
to or at the direction of the Trustee within 180 days of the Closing Date (or
within such longer period after the Closing Date as the Trustee may consent to,
which consent shall not be unreasonably withheld so long as the related Mortgage
Loan Seller has provided
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the Trustee with evidence of such recording or filing, as the case may be, or
has certified to the Trustee as to the occurrence of such recording or filing,
as the case may be, and is, as certified to the Trustee no less often than
quarterly, in good faith attempting to obtain from the appropriate county
recorder's or filing office such original or copy). If the related Mortgage Loan
Seller cannot deliver, or cause to be delivered, as to any Mortgage Loan, the
original or a copy of the related lender's title insurance policy referred to in
clause (9) of the definition of "Mortgage File" solely because such policy has
not yet been issued, the delivery requirements of this Section 2.01(b) shall be
deemed to be satisfied as to such missing item, and such missing item shall be
deemed to have been included in the related Mortgage File, provided that the
related Mortgage Loan Seller shall have delivered to the Trustee or a Custodian
appointed thereby, on or before the Closing Date, a commitment for title
insurance "marked-up" at the closing of such Mortgage Loan, and the related
Mortgage Loan Seller shall deliver to the Trustee or such Custodian, promptly
following the receipt thereof, the original related lender's title insurance
policy (or a copy thereof). In addition, notwithstanding anything to the
contrary contained herein, if there exists with respect to any group of related
Cross-Collateralized Mortgage Loans only one original of any document referred
to in the definition of "Mortgage File" covering all the Mortgage Loans in such
group, then the inclusion of the original of such document in the Mortgage File
for any of the Mortgage Loans in such group shall be deemed an inclusion of such
original in the Mortgage File for each such Mortgage Loan. Neither the Trustee
nor any Custodian shall in any way be liable for any failure by the Mortgage
Loan Seller or the Depositor to comply with the delivery requirements of the
Mortgage Loan Purchase Agreement and this Section 2.01(b).
If any of the endorsements referred to in clause (1) of the definition of
"Mortgage File", or any of the assignments referred to in clauses (3), (5) and
(7) of the definition of "Mortgage File", are delivered to the Trustee in blank,
the Trustee shall be responsible for completing the related endorsement or
assignment in the name of the Trustee (in such capacity).
(c) Except under the circumstances provided for in the last sentence of
this subsection (c), the Trustee shall, as to each Mortgage Loan, at the expense
of the related Mortgage Loan Seller, promptly (and in any event within 45 days
of the Closing Date) cause to be submitted for recording or filing, as the case
may be, in the appropriate public office for real property records or UCC
Financing Statements, as appropriate, each assignment referred to in clauses (3)
and (5) of the definition of "Mortgage File" and each UCC-2 and UCC-3 referred
to in clause (11)(B) of the definition of "Mortgage File"; provided, however,
that each Mortgage Loan Seller shall have the right to direct the Trustee, in
writing, to cause the aforementioned recording and filing requirements to be
completed (within the specified time period) by a Person other than the Trustee,
in which case the Trustee shall (i) promptly deliver the referenced documents to
such Person for recording and filing and (ii) notify the related Mortgage Loan
Seller with respect to each Mortgage Loan for which the related assignment or
file copy of any UCC-2 and UCC-3 has not been received within the time period
specified in Section 2.02(b). Each such assignment shall reflect that it should
be returned by the public recording office to the Trustee or its designee
following recording, and each such UCC-2 and UCC-3 shall reflect that the file
copy thereof should be returned to the Trustee or its designee following filing.
Promptly following receipt, the Trustee shall, at the expense of the respective
Mortgage Loan Seller, deliver a copy of any such document or instrument to the
Master Servicer.
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If any such document or instrument is lost or returned unrecorded or unfiled, as
the case may be, because of a defect therein, the Trustee shall direct the
related Mortgage Loan Seller pursuant to the related Mortgage Loan Purchase
Agreement promptly to prepare or cause to be prepared a substitute therefor or
cure such defect, as the case may be, and thereafter the Trustee shall upon
receipt thereof cause the same to be duly recorded or filed, as appropriate.
(d) All documents and records in the Depositor's or any Mortgage Loan
Seller's possession relating to the Mortgage Loans that are not required to be a
part of a Mortgage File in accordance with the definition thereof shall be
delivered to the Master Servicer on or before the Closing Date and shall be held
by the Master Servicer (or a Sub-Servicer retained thereby) on behalf of the
Trustee in trust for the benefit of the Certificateholders. If the Sub-Servicer
shall hold any original documents and records delivered to it pursuant to this
clause (d) then the Sub-Servicer shall deliver copies thereof to the Master
Servicer.
(e) In connection with the Depositor's assignment pursuant to subsection
(a) above, the Depositor shall deliver, and hereby represents and warrants that
it has delivered, to the Trustee and the Master Servicer, on or before the
Closing Date, a fully executed original counterpart of each Mortgage Loan
Purchase Agreement, as in full force and effect, without amendment or
modification, on the Closing Date.
SECTION 2.02 Acceptance by Trustee.
(a) The Trustee, by the execution and delivery of this Agreement,
acknowledges receipt by it or a Custodian on its behalf, subject to the
provisions of Section 2.01 and the further review provided for in this Section
2.02, and further subject to any exceptions noted on any exception report
prepared by the Trustee or such Custodian and attached hereto as Schedule II, of
the documents specified in clauses (1), (2), (3), (9) and (12) of the definition
of "Mortgage File", of a fully executed original counterpart of each Mortgage
Loan Purchase Agreement and of all other assets included in REMIC I and
delivered to it, in good faith and without notice of any adverse claim, and
declares that it or a Custodian on its behalf holds and will hold such documents
and the other documents delivered or caused to be delivered by the Mortgage Loan
Sellers constituting the Mortgage Files, and that it holds and will hold such
other assets included in REMIC I, in trust for the exclusive use and benefit of
all present and future Certificateholders.
(b) Within 60 days of the Closing Date, the Trustee or a Custodian on its
behalf shall review each of the Mortgage Loan documents delivered or caused to
be delivered by the Mortgage Loan Sellers constituting the Mortgage Files; and,
promptly following such review, the Trustee shall certify in writing to each of
the Depositor, the Master Servicer, the Special Servicer and each Mortgage Loan
Seller that, as to each Mortgage Loan listed in the Mortgage Loan Schedule
(other than any Mortgage Loan paid in full or any Mortgage Loan specifically
identified in any exception report annexed thereto as not being covered by such
certification), (i) all documents specified in clauses (1), (2), (3), (9) and
(12) of the definition of "Mortgage File" are in its possession or the related
Mortgage Loan Seller has otherwise satisfied the delivery requirements in
accordance with Section 2.01(b) and (ii) all documents delivered or caused to be
delivered by the related Mortgage Loan Seller constituting the
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related Mortgage File have been reviewed by it or by a Custodian on its behalf
and appear regular on their face and relate to such Mortgage Loan.
(c) The Trustee or a Custodian on its behalf shall review each of the
Mortgage Loan documents received thereby subsequent to the Closing Date; and, on
or about the first anniversary of the Closing Date, the Trustee shall certify in
writing to each of the Depositor, the Master Servicer, the Special Servicer, the
Majority Certificateholder of the Controlling Class and each Mortgage Loan
Seller that, as to each Mortgage Loan listed on the Mortgage Loan Schedule
(other than any Mortgage Loan as to which a Liquidation Event has occurred) and
except as specifically identified in any exception report annexed to such
certification), (i) all documents specified in clauses (1), (2), (9) and (12) of
the definition of "Mortgage File" are in its possession or the related Mortgage
Loan Seller has otherwise satisfied the delivery requirements in accordance with
Section 2.01(b), (ii) it or a Custodian on its behalf has received either a
recorded original of each of the assignments specified in clauses (3) and,
insofar as an unrecorded original thereof had been delivered or caused to be
delivered by the related Mortgage Loan Seller, (5) of the definition of
"Mortgage File" or a copy of such recorded original certified by the applicable
public recording office to be true and complete and (iii) all Mortgage Loan
documents received by it or any Custodian have been reviewed by it or by such
Custodian on its behalf and appear regular on their face and relate to such
Mortgage Loan.
(d) It is acknowledged that neither the Trustee nor any Custodian is under
any duty or obligation (i) to determine whether any of the documents specified
in clauses (4) - (8), (10), (11), (13), (14) and (15) of the definition of
"Mortgage File" exist or are required to be delivered by the Depositor, any
Mortgage Loan Seller or any other Person or (ii) to inspect, review or examine
any of the documents, instruments, certificates or other papers relating to the
Mortgage Loans delivered to it to determine that the same are genuine,
enforceable, in recordable form or appropriate for the represented purpose or
that they are other than what they purport to be on their face.
(e) If, in the process of reviewing the Mortgage Files or at any time
thereafter, the Trustee or any Custodian finds (or, if at any time, any other
party hereto finds) any document or documents constituting a part of a Mortgage
File to have not been properly executed or, subject to Section 2.01(b), to have
not been delivered, to contain information that does not conform in any material
respect with the corresponding information set forth in the Mortgage Loan
Schedule, or to be defective on its face (each, a "Defect" in the related
Mortgage File) the Trustee (or such other party) shall promptly so notify each
of the other parties hereto and the related Mortgage Loan Seller. If and when
notified of any error in the Mortgage Loan Schedule, the Depositor shall
promptly correct such error and distribute a new, corrected Mortgage Loan
Schedule to each of the other parties hereto, and upon receipt by the Trustee of
such a corrected Mortgage Loan Schedule so identified, such new, corrected
Mortgage Loan Schedule shall be deemed to amend and replace the existing
Mortgage Loan Schedule for all purposes.
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SECTION 2.03 Mortgage Loan Sellers' Repurchase of Mortgage Loans for
Defects in Mortgage Files and Breaches of Representations
and Warranties.
(a) If the Trustee discovers or receives notice of a Defect in any Mortgage
File or a breach of any representation or warranty set forth in or made pursuant
to Section 4(a) of each Mortgage Loan Purchase Agreement or Section 2(a) of
either Supplemental Agreement (a "Breach"), which Defect or Breach, as the case
may be, materially and adversely affects the value of any Mortgage Loan or the
interests of the Certificateholders therein, or if the Trustee discovers or
receives notice of any event that would give rise to the repurchase of a
Mortgage Loan pursuant to Section 6(b) of any Mortgage Loan Purchase Agreement
or Section 4(b) of either Supplemental Agreement, the Trustee shall give prompt
written notice of such Defect, Breach or event, as the case may be, to the
Depositor, the Master Servicer, the Special Servicer and the Rating Agencies and
the related Mortgage Loan Seller (and GMACCM, in the case of such a Defect,
Breach or event under a Supplemental Agreement) and shall request that the
related Mortgage Loan Seller (or GMACCM, in the case of such a Defect, Breach or
event under the Supplemental Agreement), within the time period provided for in
the related Mortgage Loan Purchase Agreement or Supplemental Agreement, as
applicable, cure such Defect, Breach or event, as the case may be, in all
material respects or repurchase the affected Mortgage Loan at the applicable
Purchase Price in conformity with the related Mortgage Loan Purchase Agreement
or Supplemental Agreement, as applicable; provided, however, that in lieu of
effecting any such repurchase, a Mortgage Loan Seller (or GMACCM, in the case of
such a Defect, Breach or event under the Supplemental Agreement) will be
permitted until the second anniversary of the Closing Date to deliver a
Qualifying Substitute Mortgage Loan and to pay a cash amount equal to the
applicable Substitution Shortfall Amount, subject to the terms and conditions of
the related Mortgage Loan Purchase Agreement or Supplemental Agreement, as
applicable, and this Agreement; provided, further, that if such Defect or Breach
would cause the Mortgage Loan to be other than a "qualified mortgage" under
Section 860G(a)(3) of the Code, such Defect or Breach shall be cured or the
related Mortgage Loan shall be repurchased or replaced with a Qualifying
Substitute Mortgage Loan within 90 days of discovery.
As to any Qualifying Substitute Mortgage Loan or Loans, the Trustee shall
direct the related Mortgage Loan Seller (or GMACCM, in the case of such a
Defect, Breach or event under the Supplemental Agreement) to deliver to the
Trustee for such Qualifying Substitute Mortgage Loan or Loans (with a copy to
the Master Servicer), the related Mortgage File(s) with the related Mortgage
Note(s) endorsed as required by clause (1) of the definition of "Mortgage File".
No substitution may be made in any calendar month after the Determination Date
for such month. Monthly Payments due with respect to Qualifying Substitute
Mortgage Loans in the month of substitution shall not be part of the Trust Fund
and will be retained by Master Servicer and remitted by the Master Servicer to
the related Mortgage Loan Seller (or GMACCM, in the case of such a Defect,
Breach or event under the Supplemental Agreement) on the next succeeding
Distribution Date. For the month of substitution, distributions to
Certificateholders will include the Monthly Payment due on the related Deleted
Mortgage Loan for such month and thereafter the related Mortgage Loan Seller (or
GMACCM, in the case of such a Defect, Breach or event under the
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Supplemental Agreement) shall be entitled to retain all amounts received in
respect of such Deleted Mortgage Loan.
In any month in which the related Mortgage Loan Seller (or GMACCM under a
Supplemental Agreement) substitutes one or more Qualifying Substitute Mortgage
Loans for one or more Deleted Mortgage Loans, the Master Servicer will determine
the applicable Substitution Shortfall Amount. The Trustee shall direct the
related Mortgage Loan Seller (or GMACCM, as applicable) to deposit cash equal to
such amount into the Distribution Account concurrently with the delivery of the
Mortgage File(s) for the Qualifying Substitute Mortgage Loan(s), without any
reimbursement thereof. The Trustee shall also direct the related Mortgage Loan
Seller (or GMACCM, as applicable) to give written notice to the Trustee and the
Master Servicer of such deposit, accompanied by an Officers' Certificate as to
the calculation of the applicable Substitution Shortfall Amount. The Trustee
shall direct the related Mortgage Loan Seller (or GMACCM, as applicable) to
amend the Mortgage Loan Schedule to reflect the removal of each Deleted Mortgage
Loan and, if applicable, the substitution of the Qualifying Substitute Mortgage
Loan(s); and, upon such amendment, the Trustee shall deliver or cause the
delivery of such amended Mortgage Loan Schedule to the other parties hereto.
Upon any such substitution, the Qualifying Substitute Mortgage Loan(s) shall be
subject to the terms of this Agreement in all respects.
(b) In connection with any repurchase of or substitution for a Mortgage
Loan contemplated by this Section 2.03, the Trustee, the Master Servicer and the
Special Servicer shall each tender promptly to the related Mortgage Loan Seller
(or GMACCM, as applicable), upon delivery to each of the Trustee, the Master
Servicer and the Special Servicer of a trust receipt executed by the related
Mortgage Loan Seller (or GMACCM, as applicable), all portions of the Mortgage
File and other documents pertaining to such Mortgage Loan possessed by it, and
each document that constitutes a part of the related Mortgage File that was
endorsed or assigned to the Trustee shall be endorsed or assigned, as the case
may be, to the related Mortgage Loan Seller (or GMACCM, as applicable) in the
same manner as provided in Section 2 of each Mortgage Loan Purchase Agreement.
Additionally, in connection with any repurchase of or substitution for a
Mortgage Loan pursuant to this Section 2.03, the Master Servicer shall release
or cause to be released to the related Mortgage Loan Seller (or GMACCM, as
applicable) any Reserve Funds or Escrow Payments with respect to the related
Mortgage Loan. If the affected Mortgage Loan is to be repurchased, the Trustee
shall designate the Certificate Account as the account to which funds in the
amount of the Purchase Price are to be wired.
(c) Section 6 of the related Mortgage Loan Purchase Agreement and Section 4
of each Supplemental Agreement provides the sole remedy available to the
Certificateholders, or the Trustee on behalf of the Certificateholders,
respecting any Defect in a Mortgage File or any Breach of any representation or
warranty set forth in or required to be made pursuant to Section 4(a) of such
Mortgage Loan Purchase Agreement or Section 2(a) of such Supplemental Agreement
or any of the circumstances described in Section 6(b) of such Mortgage Loan
Purchase Agreement or in Section 4(b) of such Supplemental Agreement.
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(d) The Trustee shall, for the benefit of the Certificateholders, enforce
the obligations of each Mortgage Loan Seller under Section 6 of the related
Mortgage Loan Purchase Agreement and the obligations of GMACCM under Section 4
of each Supplemental Agreement. Such enforcement, including, without limitation,
the legal prosecution of claims, shall be carried out in such form, to such
extent and at such time as the Trustee would require were it, in its individual
capacity, the owner of the affected Mortgage Loan(s). The Trustee shall be
reimbursed for the reasonable costs of such enforcement, together with interest
thereon at the Reimbursement Rate: first, from a specific recovery of costs,
expenses or attorneys' fees against the related Mortgage Loan Seller (or GMACCM,
in the case of enforcement under a Supplemental Agreement); second, pursuant to
Section 3.05(a)(ix) out of the related Purchase Price, to the extent that such
expenses are a specific component thereof; and third, if at the conclusion of
such enforcement action it is determined that the amounts described in clauses
first and second are insufficient, then pursuant to Section 3.05(a)(x) out of
general collections on the Mortgage Loans on deposit in the Certificate Account.
SECTION 2.04 Issuance of Class R-I Certificates; Creation of REMIC I
Regular Interests.
Concurrently with the assignment to the Trustee of the assets included in
REMIC I, and in exchange therefor, at the direction of the Depositor, the REMIC
I Regular Interests have been issued hereunder and the Trustee has executed, and
caused the Certificate Registrar to authenticate and deliver, to or upon the
order of the Depositor, the Class R-I Certificates in authorized denominations.
The interests evidenced by the Class R-I Certificates, together with the REMIC I
Regular Interests, constitute the entire beneficial ownership of REMIC I. The
rights of the Class R-I Certificateholders and REMIC II to receive distributions
from the proceeds of REMIC I in respect of the Class R-I Certificates and the
REMIC I Regular Interests, respectively, and all ownership interests of the
Class R-I Certificateholders and REMIC II in and to such distributions, shall be
as set forth in this Agreement.
SECTION 2.05 Conveyance of REMIC I Regular Interests; Acceptance of REMIC
II by the Trustee.
The Depositor, as of the Closing Date, and concurrently with the execution
and delivery hereof, does hereby assign without recourse all the right, title
and interest of the Depositor in and to the REMIC I Regular Interests to the
Trustee for the benefit of the Class R-II Certificateholders and REMIC III as
holder of the REMIC II Regular Interests. The Trustee acknowledges the
assignment to it of the REMIC I Regular Interests and declares that it holds and
will hold the same in trust for the exclusive use and benefit of all present and
future Class R-II Certificateholders and REMIC III as the holder of the REMIC II
Regular Interests.
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SECTION 2.06 Issuance of Class R-II Certificates; Creation of REMIC II
Regular Interest.
Concurrently with the assignment to the Trustee of the REMIC I Regular
Interests, and in exchange therefor, at the direction of the Depositor, the
REMIC II Regular Interests have been issued hereunder and the Trustee has
executed, and caused the Certificate Registrar to authenticate and deliver, to
or upon the order of the Depositor, the Class R-II Certificates in authorized
denominations. The interests evidenced by the Class R-II Certificates, together
with the REMIC II Regular Interests, constitute the entire beneficial ownership
of REMIC II. The rights of the Class R-II Certificateholders and REMIC III to
receive distributions from the proceeds of REMIC II in respect of the Class R-II
Certificates and the REMIC II Regular Interests, respectively, and all ownership
interests of the Class R-II Certificateholders and REMIC III in and to such
distributions, shall be as set forth in this Agreement.
SECTION 2.07 Conveyance of REMIC II Regular Interests; Acceptance of REMIC
III by Trustee.
The Depositor, as of the Closing Date, and concurrently with the execution
and delivery hereof, does hereby assign without recourse all the right, title
and interest of the Depositor in and to the REMIC II Regular Interests to the
Trustee for the benefit of the REMIC III Certificateholders. The Trustee
acknowledges the assignment to it of the REMIC II Regular Interests and declares
that it holds and will hold the same in trust for the exclusive use and benefit
of all present and future REMIC III Certificateholders.
SECTION 2.08 Issuance of REMIC III Certificates.
Concurrently with the assignment to the Trustee of the REMIC II Regular
Interests, and in exchange therefor, at the direction of the Depositor, the
Trustee has executed, and caused the Certificate Registrar to authenticate and
deliver, to or upon the order of the Depositor, the REMIC III Certificates in
authorized denominations evidencing the entire beneficial ownership of REMIC
III. The rights of the respective Classes of REMIC III Certificateholders to
receive distributions from the proceeds of REMIC III in respect of their REMIC
III Certificates, and all ownership interests of the respective Classes of REMIC
III Certificateholders in and to such distributions, shall be as set forth in
this Agreement.
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ARTICLE III
ADMINISTRATION AND SERVICING
OF THE TRUST FUND
SECTION 3.01 Servicing and Administration of the Mortgage Loans.
(a) Each of the Master Servicer and the Special Servicer shall service and
administer the Mortgage Loans that it is obligated to service and administer
pursuant to this Agreement on behalf of the Trustee and in the best interests of
and for the benefit of the Certificateholders (as determined by the Master
Servicer or the Special Servicer, as the case may be, in its good faith and
reasonable judgment), in accordance with applicable law, the terms of this
Agreement and the terms of the respective Mortgage Loans and, to the extent
consistent with the foregoing, further as follows: (i) with the same care, skill
and diligence as is normal and usual in its general mortgage servicing and REO
property management activities on behalf of third parties or on behalf of
itself, whichever is higher, with respect to mortgage loans and REO properties
that are comparable to those for which it is responsible hereunder; (ii) with a
view to the timely collection of all scheduled payments of principal and
interest under the Mortgage Loans or, if a Mortgage Loan comes into and
continues in default and if, in the good faith and reasonable judgment of the
Special Servicer, no satisfactory arrangements can be made for the collection of
the delinquent payments, the maximization of the recovery on such Mortgage Loan
to the Certificateholders (as a collective whole) on a present value basis (the
relevant discounting of anticipated collections that will be distributable to
Certificateholders to be performed at the related Net Mortgage Rate); and (iii)
without regard to (A) any relationship that the Master Servicer or the Special
Servicer, as the case may be, or any Affiliate thereof may have with the related
Mortgagor, (B) the ownership of any Certificate by the Master Servicer or the
Special Servicer, as the case may be, or by any Affiliate thereof, (C) the
Master Servicer's obligation to make Advances, (D) the Special Servicer's
obligation to make (or to direct the Master Servicer to make) Servicing
Advances, (E) the right of the Master Servicer (or any Affiliate thereof) or the
Special Servicer (or any Affiliate thereof), as the case may be, to receive
reimbursement of costs, or the sufficiency of any compensation payable to it,
hereunder or with respect to any particular transaction and (F) the obligation
of GMACCM, as a Mortgage Loan Seller, to repurchase Mortgage Loans pursuant to
Section 6(b) of the Mortgage Loan Purchase Agreement or Section 4(b) of either
Supplemental Agreement (the conditions set forth in the immediately foregoing
clauses (i), (ii) and (iii), the "Servicing Standard"). Without limiting the
generality of the foregoing, each of the Master Servicer and the Special
Servicer, in its own name, in connection with its servicing and administrative
duties hereunder is hereby authorized and empowered by the Trustee to exercise
efforts consistent with the foregoing standard and to execute and deliver, on
behalf of the Certificateholders and the Trustee or any of them, any and all
financing statements, continuation statements and other documents or instruments
necessary to maintain the lien created by any Mortgage or other security
document in the related Mortgage File on the related Mortgaged Property and
related collateral; subject to Section 3.20, any and all modifications, waivers,
amendments or consents to or with respect to any documents contained in the
related Mortgage File; and any and all instruments of satisfaction or
cancellation, or of full release or discharge, and all other comparable
instruments, with respect to
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the Mortgage Loans and the Mortgaged Properties. Each of the Master Servicer and
the Special Servicer is also authorized to approve a request by a Mortgagor
under a Mortgage Loan that it is obligated to service and administer pursuant to
this Agreement, for an easement, consent to alteration or demolition, and for
other similar matters, provided that the Master Servicer or the Special
Servicer, as the case may be, determines, exercising its good faith business
judgment and in accordance with the Servicing Standard, that such approval will
not affect the security for, or the timely and full collectability of, the
related Mortgage Loan. Subject to Section 3.10, the Trustee shall furnish, or
cause to be furnished, to the Master Servicer and the Special Servicer any
powers of attorney and other documents necessary or appropriate to enable the
Master Servicer or the Special Servicer, as the case may be, to carry out its
servicing and administrative duties hereunder; provided, however, that the
Trustee shall not be held liable, and shall be indemnified by the Master
Servicer or the Special Servicer, as applicable, for any negligence with respect
to, or misuse of, any such power of attorney by the Master Servicer or the
Special Servicer, as the case may be.
(b) Subject to Section 3.01(a), the Master Servicer and the Special
Servicer each shall have full power and authority, acting alone or, subject to
Section 3.22, through Sub-Servicers, to do or cause to be done any and all
things in connection with such servicing and administration which it may deem
necessary or desirable.
(c) The relationship of the Master Servicer and the Special Servicer to the
Trustee and, unless the same Person acts in both capacities, to each other under
this Agreement is intended by the parties to be that of an independent
contractor and not that of a joint venturer, partner or agent. Unless the same
Person acts in both capacities, the Master Servicer shall have no responsibility
for the performance by the Special Servicer of its duties under this Agreement,
and the Special Servicer shall have no responsibility for the performance of the
Master Servicer under this Agreement.
(d) Subject to Section 3.01(a), each of the Master Servicer and Special
Servicer shall service and administer each Mortgage Loan that is a
Cross-Collateralized Mortgage Loan as a single Mortgage Loan as and when it
deems such treatment necessary and appropriate.
SECTION 3.02 Collection of Mortgage Loan Payments.
The Master Servicer (or the Special Servicer with respect to the Specially
Serviced Mortgage Loans) shall make reasonable efforts to collect all payments
called for under the terms and provisions of the Mortgage Loans, and shall, to
the extent such procedures shall be consistent with this Agreement and the terms
and conditions of the Mortgage Loans, follow such collection procedures as are
consistent with the Servicing Standard; provided, however, that nothing herein
contained shall be construed as an express or implied guarantee by the Master
Servicer or the Special Servicer of the collectability of the Mortgage Loans.
Consistent with the foregoing, the Master Servicer may in its discretion waive
any Penalty Charge in connection with any delinquent payment on a Mortgage Loan
(other than a Specially Serviced Mortgage Loan) and the Special Servicer may in
its discretion waive any Penalty Charge in connection with any delinquent
payment on a Specially Serviced Mortgage Loan.
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SECTION 3.03 Collection of Taxes, Assessments and Similar Items; Servicing
Accounts and Reserve Accounts.
(a) Each of the Master Servicer (or the Special Servicer with respect to
the Specially Serviced Mortgage Loans) shall establish and maintain one or more
accounts (the "Servicing Accounts"), into which all Escrow Payments shall be
deposited and retained. Servicing Accounts shall be Eligible Accounts.
Withdrawals of amounts so collected in respect of any Mortgage Loan (and
interest earned thereon) from a Servicing Account may be made only to: (i)
effect payment of real estate taxes, assessments, insurance premiums, ground
rents (if applicable) and comparable items in respect of the related Mortgaged
Property; (ii) reimburse the Fiscal Agent, the Trustee, the Master Servicer and
the Special Servicer, in that order, as applicable, for any unreimbursed
Servicing Advances made thereby to cover any of the items described in the
immediately preceding clause (i); (iii) refund to the related Mortgagor any sums
as may be determined to be overages; (iv) pay interest, if required and as
described below, to the related Mortgagor on balances in the Servicing Account
(or, if and to the extent not payable to the related Mortgagor, to pay such
interest to the Master Servicer or Special Servicer, as applicable); (v)
disburse Insurance Proceeds if required to be applied to the repair or
restoration of the related Mortgaged Property; or (vi) clear and terminate the
Servicing Account at the termination of this Agreement in accordance with
Section 9.01. As part of its servicing duties, the Master Servicer and the
Special Servicer shall pay or cause to be paid to the Mortgagors interest on
funds in Servicing Accounts maintained thereby, to the extent required by law or
the terms of the related Mortgage Loan. The Servicing Accounts shall not be
considered part of the segregated pool of assets constituting REMIC I, REMIC II,
REMIC III or the Grantor Trust.
(b) Each of the Master Servicer (with respect to Mortgage Loans other than
Specially Serviced Mortgage Loans) and the Special Servicer (with respect to the
Specially Serviced Mortgage Loans) shall (i) maintain accurate records with
respect to each related Mortgaged Property reflecting the status of real estate
taxes, assessments and other similar items that are or may become a lien thereon
and the status of insurance premiums and any ground rents payable in respect
thereof, and (ii) use reasonable efforts to obtain, from time to time, all bills
for the payment of such items (including renewal premiums) for Mortgage Loans
which require the related Mortgagor to escrow for the payment of such items and
shall effect payment thereof prior to the applicable penalty or termination
date, employing for such purpose Escrow Payments as allowed under the terms of
the related Mortgage Loan. To the extent that a Mortgage Loan does not require a
Mortgagor to escrow for the payment of real estate taxes, assessments, insurance
premiums, ground rents (if applicable) and similar items, the Master Servicer
(or the Special Servicer with respect to the Specially Serviced Mortgaged Loans)
shall use reasonable efforts consistent with the Servicing Standard to cause the
related Mortgagor to comply with the requirements of the related Mortgage for
payments in respect of such items at the time they first become due.
(c) In accordance with the Servicing Standard, the Master Servicer (at the
direction of the Special Servicer in the case of Specially Serviced Mortgage
Loans) shall advance with respect to each related Mortgaged Property all such
funds as are necessary for the purpose of effecting the payment of (i) real
estate taxes, assessments and other similar items that are or may
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become a lien thereon, (ii) ground rents (if applicable), and (iii) premiums on
Insurance Policies, in each instance if and to the extent Escrow Payments
collected from the related Mortgagor are insufficient to pay such item when due
and the related Mortgagor has failed to pay such item on a timely basis, and
provided that the particular advance would not, if made, constitute a
Nonrecoverable Servicing Advance. All such Servicing Advances shall be
reimbursable in the first instance from related collections from the Mortgagors,
and further as provided in Section 3.05. No costs incurred by the Master
Servicer or the Special Servicer in effecting the payment of real estate taxes,
assessments, ground rents (if applicable) and other similar items on or in
respect of the Mortgaged Properties shall, for purposes hereof, including,
without limitation, calculating monthly distributions to Certificateholders, be
added to the unpaid principal balances of the related Mortgage Loans,
notwithstanding that the terms of such Mortgage Loans so permit.
(d) The Master Servicer (or the Special Servicer with respect to Specially
Serviced Mortgage Loans) shall, establish and maintain, as applicable, one or
more accounts (the "Reserve Accounts"), into which all Reserve Funds, if any,
shall be deposited and retained. Withdrawals of amounts so deposited may be made
to pay for, or to reimburse the related Mortgagor in connection with, the
related repairs, environmental remediation, replacements and/or capital
improvements at the related Mortgaged Property if such repairs, environmental
remediation, replacements and/or capital improvements have been completed, and
such withdrawals are made, in accordance with the Servicing Standard and the
terms of the related Mortgage Note, Mortgage and any agreement with the related
Mortgagor governing such Reserve Funds. Subject to the terms of the related
Mortgage Note and Mortgage, all Reserve Accounts shall be Eligible Accounts. As
part of its servicing duties, the Master Servicer and the Special Servicer shall
pay or cause to be paid to the Mortgagors interest on funds in the Reserve
Accounts maintained thereby, to the extent required by law or the terms of the
related Mortgage Loan. The Reserve Accounts shall not be considered part of the
segregated pool of assets comprising REMIC I, REMIC II, REMIC III or the Grantor
Trust.
SECTION 3.04 Certificate Account, Distribution Account and Interest
Reserve Account.
(a) The Master Servicer shall establish and maintain a Certificate Account
in which the Master Servicer shall deposit or cause to be deposited on a daily
basis, except as otherwise specifically provided herein, the following payments
and collections received or made by or on behalf of it subsequent to the Cut-off
Date (other than in respect of principal and interest on the Mortgage Loans due
and payable on or before the Cut-off Date), and payments (other than Principal
Prepayments) received by it on or prior to the Cut-off Date but allocable to a
period subsequent thereto:
(i) all payments on account of principal, including Principal Prepayments,
on the Mortgage Loans;
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(ii) all payments on account of interest (including, without limitation,
Default Interest and Excess Interest) on the Mortgage Loans, late payment
charges and Prepayment Premiums;
(iii) any amounts received from the Special Servicer which are required to
be transferred from the REO Account pursuant to Section 3.16(c) and amounts of
interest and investment income earned in respect of amounts relating to the
Trust Fund held in any Lock-Box Account or Cash Collateral Account, if any, and
only to the extent not required to be paid to the applicable Mortgagor under the
terms of the related Mortgage Loan documents or applicable law;
(iv) all Insurance Proceeds and Liquidation Proceeds received in respect of
any Mortgage Loan or REO Property (other than Excess Liquidation Proceeds and
Liquidation Proceeds that are received in connection with the Master Servicer's
or the Depositor's purchase of all the Mortgage Loans and any REO Properties in
the Trust Fund and that are to be deposited in the Distribution Account pursuant
to Section 9.01);
(v) any amounts required to be deposited by the Master Servicer pursuant to
Section 3.06 in connection with losses incurred with respect to Permitted
Investments of funds relating to the Trust Fund held in the Certificate Account;
(vi) that portion of each Delinquency Advance that represents (without
duplication) the Master Servicing Fee and, if applicable, the Special Servicing
Fee; and
(vii) any amounts required to be deposited by the Master Servicer or the
Special Servicer pursuant to Section 3.07(b) in connection with losses resulting
from a deductible clause in a blanket hazard policy.
The foregoing requirements for deposit in the Certificate Account shall be
exclusive, it being understood and agreed that, without limiting the generality
of the foregoing, actual payments from Mortgagors in the nature of Escrow
Payments, Reserve Funds, charges for beneficiary statements or demands,
assumption fees, amounts collected for mortgagor checks returned for
insufficient funds, ancillary fees and any other amounts that the Master
Servicer and the Special Servicer are entitled to as additional servicing
compensation pursuant to Section 3.11 need not be deposited by the Master
Servicer in the Certificate Account. If the Master Servicer shall deposit in the
Certificate Account any amount not required to be deposited therein, it may at
any time withdraw such amount from the Certificate Account, any provision herein
to the contrary notwithstanding. The Master Servicer shall promptly deliver to
the Special Servicer as additional servicing compensation in accordance with
Section 3.11(d), assumption fees, modification fees, ancillary fees and other
transaction fees due to and received by the Master Servicer with respect to
Specially Serviced Mortgage Loans. The Certificate Account shall be maintained
as a segregated account, separate and apart from trust funds created for
mortgage pass-through certificates of other series serviced and the other
accounts of the Master Servicer.
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Upon receipt of any of the amounts described in clauses (i), (ii) and (iv)
above with respect to any Mortgage Loan which is not an REO Loan, the Special
Servicer shall promptly, but in no event later than two Business Days after
receipt, remit such amounts to the Master Servicer for deposit into the
Certificate Account in accordance with the second preceding paragraph, unless
the Special Servicer determines, consistent with the Servicing Standard, that a
particular item should not be deposited because of a restrictive endorsement or
other appropriate reason. Any such amounts received by the Special Servicer with
respect to an REO Property shall be deposited by the Special Servicer into the
REO Account and remitted to the Master Servicer for deposit into the Certificate
Account pursuant to Section 3.16 (c). With respect to any such amounts paid by
check to the order of the Special Servicer, the Special Servicer shall endorse
such check to the order of the Master Servicer and shall deliver promptly, but
in no event later than two Business Days after receipt, any such check to the
Master Servicer by overnight courier, unless the Special Servicer determines,
consistent with the Servicing Standard, that a particular item cannot be so
endorsed and delivered because of a restrictive endorsement or other appropriate
reason.
Funds in the Certificate Account may be invested in Permitted Investments
in accordance with the provisions of Section 3.06. The Master Servicer shall
give notice to the Trustee, the Special Servicer and the Depositor of the
location of the Certificate Account as of the Closing Date and of the new
location of the Certificate Account prior to any change thereof.
(b) The Trustee shall establish and maintain the Distribution Account in
trust for the benefit of the Certificateholders. The Distribution Account shall
be maintained as a segregated account, separate and apart from trust funds for
mortgage pass-through certificates of other series administered by the Trustee
and other accounts of the Trustee.
The Master Servicer shall deliver to the Trustee each month on or before
the Master Servicer Remittance Date therein, for deposit in the Distribution
Account, that portion of the Available Distribution Amount (calculated without
regard to clause (a)(v), (b)(iii), (b)(iv) or (b)(vi) of the definition thereof)
for the related Distribution Date then on deposit in the Certificate Account.
In addition, the Master Servicer shall, as and when required hereunder,
deliver to the Trustee for deposit in the Distribution Account:
(i) any Delinquency Advances required to be made by the Master Servicer in
accordance with Section 4.03 (in each case, net of the portion thereof that
represents Master Servicing Fees and/or Special Servicing Fees, which is to be
deposited in the Certificate Account);
(ii) any Compensating Interest Payments required to be made by the Master
Servicer pursuant to Section 3.19;
(iii) any Liquidation Proceeds paid by the Master Servicer or the Depositor
in connection with the purchase of all of the Mortgage Loans and any REO
Properties in the Trust Fund pursuant to Section 9.01 (exclusive of that portion
thereof required to be deposited in the Certificate Account pursuant to Section
9.01); and
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(iv) any other amounts required to be so delivered for deposit in the
Distribution Account pursuant to any provision of this Agreement.
The Trustee shall, upon receipt, deposit in the Distribution Account any
and all amounts received by the Trustee that are required by the terms of this
Agreement to be deposited therein. If, as of 3:00 p.m., New York City time, on
any Master Servicer Remittance Date or on such other date as any amount referred
to in the foregoing clauses (i) through (iv) is required to be delivered
hereunder, the Master Servicer shall not have delivered to the Trustee for
deposit in the Distribution Account the relevant portion of the Available
Distribution Amount or any of the amounts referred to in the foregoing clauses
(i) through (iv), then the Trustee shall provide notice of such failure to a
Servicing Officer of the Master Servicer by facsimile transmission sent to
telecopy no. (000) 000-0000 (or such alternative number provided by the Master
Servicer to the Trustee in writing) and by telephone at telephone no. (312)
000-0000 (or such alternative number provided by the Master Servicer to the
Trustee in writing) as soon as possible, but in any event before 5:00 p.m., New
York City time, on such day. To the extent the Master Servicer has not delivered
to the Trustee for deposit in the Distribution Account such amounts as are
required to be delivered on the Master Servicer Remittance Date, the Master
Servicer shall pay interest thereon to the Trustee at an interest rate equal to
the Reimbursement Rate then in effect for the period from the Master Servicing
Remittance Date to and excluding the date such amounts are deposited.
Funds in the Distribution Account may be invested by the Trustee in
Permitted Investments and the Trustee shall be required to deposit an amount
equal to the Net Investment Loss, if any, in such account, all as provided in
accordance with the provisions of Section 3.06. The Trustee shall give notice to
the Master Servicer, the Special Servicer and the Depositor of the location of
the Distribution Account as of the Closing Date and of the new location of the
Distribution Account prior to any change thereof.
(c) The Trustee shall establish and maintain the Interest Reserve Account
in trust for the benefit of the Certificateholders. The Interest Reserve Account
shall be maintained as a segregated account, separate and apart from trust funds
for mortgage pass-through certificates of other series administered by the
Trustee and other accounts of the Trustee. Funds in the Interest Reserve Account
may be invested in Permitted Investments in accordance with the provisions of
Section 3.06 and the Trustee shall be required to deposit an amount equal to the
Net Investment Loss, if any, in such account, all as provided in accordance with
the provisions of Section 3.06.
On each Master Servicer Remittance Date occurring in (i) January of each
calendar year that is not a leap year and (ii) February of each calendar year,
the Trustee shall calculate the Withheld Amount with respect to each Interest
Reserve Loan. On each such Master Servicer Remittance Date, the Trustee shall
withdraw from the Distribution Account and deposit in the Interest Reserve
Account an amount equal to the aggregate of the Withheld Amounts calculated in
accordance with the previous sentence. If the Trustee shall deposit in the
Interest Reserve Account any amount not required to be deposited therein, it may
at any time withdraw such amount from the Interest Reserve Account, any
provision herein to the contrary notwithstanding. On or prior to the
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Master Servicer Remittance Date in March of each calendar year, the Trustee
shall transfer to the Distribution Account the aggregate of all Withheld Amounts
on deposit in the Interest Reserve Account.
(d) The Trustee shall establish and maintain the Excess Liquidation
Proceeds Reserve Account in trust for the benefit of the Certificateholders. The
Excess Liquidation Proceeds Reserve Account shall be maintained as a segregated
account, separate and apart from trust funds for mortgage pass-through
certificates of other series administered by the Trustee and other accounts of
the Trustee. Funds in the Excess Liquidation Reserve Proceeds Account may be
invested by the Trustee in Permitted Investments in accordance with the
provisions of Section 3.06 and the Trustee shall be required to deposit an
amount equal to the Net Investment Shortfall, if any, in such account, all as
provided in accordance with the provisions of Section 3.06.
Upon the disposition of any REO Property in accordance with Section
3.18(d), the Special Servicer will calculate the Excess Liquidation Proceeds, if
any, realized in connection with such sale and deposit such amount in the Excess
Liquidation Proceeds Reserve Account.
SECTION 3.05 Permitted Withdrawals From the Certificate Account, the
Distribution Account, the Interest Reserve Account and the
Excess Liquidation Proceeds Reserve Account.
(a) The Master Servicer may, from time to time, make withdrawals from the
Certificate Account for any of the following purposes:
(i) to remit to the Trustee for deposit in the Distribution Account the
amounts required to be remitted pursuant to the second paragraph of Section
3.04(b) or that may be applied to make Delinquency Advances pursuant to Section
4.03(a);
(ii) to pay itself unpaid Servicing Fees payable to itself earned thereby
in respect of each Mortgage Loan and REO Loan, the Master Servicer's rights to
payment pursuant to this clause (ii) being limited to amounts received or
advanced on or in respect of such Mortgage Loan or such REO Loan that are
allocable as a recovery or advance of interest thereon;
(iii) to pay to the Special Servicer, out of general collections on the
Mortgage Loans and any REO Properties, earned and unpaid Special Servicing Fees
in respect of each Specially Serviced Mortgage Loan and REO Loan;
(iv) to pay to the Special Servicer earned and unpaid Workout Fees and
Liquidation Fees to which it is entitled pursuant to, and from the sources
contemplated by, Section 3.11(c);
(v) to reimburse the Fiscal Agent, the Trustee and itself, in that order,
as applicable, for unreimbursed Delinquency Advances made thereby, the Master
Servicer's, the Fiscal
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Agent's or the Trustee's respective rights to be reimbursed pursuant to this
clause (v) being limited to amounts received that represent Late Collections of
interest on and principal of the particular Mortgage Loans and REO Loans with
respect to which such Delinquency Advances were made (in each case, net of
related Workout Fees);
(vi) to reimburse the Fiscal Agent, the Trustee, itself and the Special
Servicer, in that order, as applicable, for unreimbursed Servicing Advances made
thereby, the Master Servicer's, the Special Servicer's, the Trustee's or the
Fiscal Agent's respective rights to be reimbursed pursuant to this clause (vi)
with respect to any Mortgage Loan or REO Property being limited to, as
applicable, related payments, Liquidation Proceeds, Insurance Proceeds and REO
Revenues;
(vii) to reimburse the Fiscal Agent, the Trustee, itself and the Special
Servicer, in that order, as applicable, out of general collections on the
Mortgage Loans and REO Properties, for Nonrecoverable Advances made thereby;
(viii) to pay the Fiscal Agent, the Trustee, itself or the Special
Servicer, in that order as the case may be, any related Advance Interest accrued
and payable on any unreimbursed Advance in accordance with Section 3.11(f) and
4.03(d), first out of Penalty Charges received on the Mortgage Loan or REO Loan
as to which such Advance was made and then, at or following such time as it
reimburses the Fiscal Agent, the Trustee, itself and the Special Servicer, in
that order, as applicable, for such Advance pursuant to clause (v), (vi) or
(vii) above or Section 3.03, out of general collections on the Mortgage Loans
and REO Properties;
(ix) to reimburse itself (if it is not the affected Mortgage Loan Seller)
or the Trustee, as the case may be, for any unreimbursed expenses reasonably
incurred by such Person in respect of any Breach or Defect giving rise to a
repurchase obligation of a Mortgage Loan Seller under Section 6 of the related
Mortgage Loan Purchase Agreement (or Section 4 of either Supplemental
Agreement), including, without limitation, any expenses arising out of the
enforcement of the repurchase obligation, together with interest thereon at the
Reimbursement Rate, each such Person's right to reimbursement pursuant to this
clause (ix) with respect to any Mortgage Loan being limited to that portion of
the Purchase Price paid for such Mortgage Loan that represents such expense in
accordance with clause (c) of the definition of Purchase Price;
(x) in accordance with Section 2.03(d), to reimburse the Trustee, out of
general collections on the Mortgage Loans and REO Properties for any
unreimbursed expense reasonably incurred by the Trustee in connection with the
enforcement of a Mortgage Loan Seller's obligations under Section 6(a) of the
related Mortgage Loan Purchase Agreement (or Section 4 of either Supplemental
Agreement), together with interest thereon at the Reimbursement Rate, but only
to the extent that such expenses are not reimbursable pursuant to clause (ix)
above or otherwise;
(xi) to pay out of general collections on the Mortgage Loans and REO
Properties, for costs and expenses incurred by the Trust Fund pursuant to
Section 3.09(c) and to pay Liquidation Expenses out of related Liquidation
Proceeds pursuant to Section 3.09;
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(xii) to pay itself, as additional servicing compensation in accordance
with Section 3.11(b), (A) interest and investment income earned in respect of
amounts relating to the Trust Fund held in the Certificate Account, any Lock-Box
Account and Cash Collateral Account as provided in Section 3.06(b) (but only to
the extent of the Net Investment Earnings with respect to the Certificate
Account, any Lock-Box Account and Cash Collateral Account for any Collection
Period), (B) Prepayment Interest Excesses and Balloon Payment Interest Excess
received on the Mortgage Loans and (C) Penalty Charges received on Mortgage
Loans that are not Specially Serviced Mortgage Loans (but only to the extent not
otherwise allocable to cover Advance Interest in respect of the related Mortgage
Loan);
(xiii) to pay to the Special Servicer, as additional servicing
compensation, all Penalty Charges received on any Specially Serviced Mortgage
Loan (but only to the extent not otherwise allocable to pay Advance Interest in
respect of the related Specially Serviced Mortgage Loan);
(xiv) to pay itself, the Depositor, or any of their respective directors,
officers, employees and agents, as the case may be, out of general collections
on the Mortgage Loans and REO Properties, any amounts payable to any such Person
pursuant to Section 6.03;
(xv) to pay, out of general collections on the Mortgage Loans and REO
Properties, for (A) the cost of the Opinions of Counsel contemplated by Sections
3.09(b)(ii) and 3.16(a), (B) the cost of the advice of counsel contemplated by
Section 3.17(a), (C) the cost of any Opinion of Counsel contemplated by Section
11.01(a) in connection with an amendment to this Agreement requested by the
Master Servicer, which amendment is in furtherance of the rights and interests
of Certificateholders, (D) the cost of obtaining the REO Extension contemplated
by Section 3.16(a), (E) the cost of recording this Agreement in accordance with
Section 11.02(a), and (F) the cost of an Appraisal obtained pursuant to Section
3.11(g) or Section 4.03(c);
(xvi) to pay itself, the Special Servicer, any Mortgage Loan Seller, GMACCM
or the Majority Certificateholder of the Controlling Class, as the case may be,
with respect to each Mortgage Loan, if any, previously purchased by such Person
pursuant to or as contemplated by this Agreement, all amounts received on such
Mortgage Loan subsequent to the date of purchase;
(xvii) to withdraw funds deposited into the Certificate Account in error;
and
(xviii) to clear and terminate the Certificate Account at the termination
of this Agreement pursuant to Section 9.01.
For each Mortgage Loan, the Master Servicer shall keep and maintain
separate accounting records, on a loan-by-loan basis (and for each REO Loan, on
a property-by-property basis) when appropriate, for the purpose of justifying
any withdrawal from the Certificate Account.
The Master Servicer shall pay to the Special Servicer (or to third party
contractors at the direction of the Special Servicer) from the Certificate
Account amounts permitted to be paid
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to it (or to such third party contractors) therefrom promptly upon receipt of a
certificate of a Servicing Officer of the Special Servicer describing the item
and amount to which the Special Servicer (or such third party contractors) is
entitled. The Master Servicer may rely conclusively on any such certificate and
shall have no duty to re-calculate the amounts stated therein. The Special
Servicer shall keep and maintain separate accounting for each Specially Serviced
Mortgage Loan and REO Property, on a loan-by-loan and property-by-property
basis, for the purpose of justifying any request for withdrawal from the
Certificate Account.
(b) The Trustee may, from time to time, make withdrawals from the
Distribution Account for any of the following purposes:
(i) to make distributions to Certificateholders on each Distribution Date
pursuant to Section 4.01 and to deposit the Withheld Amounts in the Interest
Reserve Account pursuant to Section 3.04(c);
(ii) to pay itself interest and investment income earned in respect of
amounts relating to the Trust Fund held in the Distribution Account as provided
in Section 3.06(b) (but only to the extent of the Net Investment Earnings with
respect to the Distribution Account for any Collection Period);
(iii) to pay itself unpaid Trustee Fees pursuant to Section 8.05(a);
(iv) to pay itself or any of its directors, officers, employees and agents,
as the case may be, any amounts payable or reimbursable to any such Person
pursuant to Section 8.05(b);
(v) to pay for (A) the cost of the Opinion of Counsel contemplated by
Section 11.01(a) or (c) in connection with any amendment to this Agreement
requested by the Trustee, which amendment is in furtherance of the rights and
interests of Certificateholders, (B) the cost of the Opinion of Counsel
contemplated by Section 11.02(a) in connection with any recordation of this
Agreement and (C) to the extent payable out of the Trust Fund, the cost of the
Opinion of Counsel contemplated by Section 10.01(f);
(vi) to (A) pay any and all federal, state and local taxes imposed on REMIC
I, REMIC II or REMIC III or on the assets or transactions of any such REMIC,
together with all incidental costs and expenses, and any and all reasonable
expenses relating to tax audits, if and to the extent that either (1) none of
the Trustee, the Master Servicer or the Special Servicer is liable therefor
pursuant to Section 10.01(g) or (2) any such Person that may be so liable has
failed to make the required payment, and (B) reimburse the Trustee for
reasonable expenses incurred by and reimbursable to it by the Trust Fund
pursuant to Section 10.01(c);
(vii) to withdraw funds deposited into the Distribution Account in error;
and
(viii) to clear and terminate the Distribution Account at the termination
of this Agreement pursuant to Section 9.01.
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(c) The Trustee may, from time to time, make withdrawals from the Interest
Reserve Account to pay itself interest and investment income earned in respect
of amounts relating to the Trust Fund held in the Interest Reserve Account (but
only to the extent of Net Investment Earnings with respect to the Interest
Reserve Account for any Collection Period).
(d) The Trustee shall, on any Distribution Date, make withdrawals from the
Excess Liquidation Proceeds Reserve Account to the extent required to make the
distributions from the Excess Liquidation Proceeds Reserve Account required by
Section 4.01(c).
SECTION 3.06 Investment of Funds in the Certificate Account, the
Distribution Account, the Excess Liquidation Proceeds
Reserve Account, the Interest Reserve Account and the REO
Account.
(a) (i) The Master Servicer may direct any depository institution
maintaining the Certificate Account, any Lock-Box Account or any Cash Collateral
Account to invest, (ii) the Special Servicer may direct any depository
institution maintaining the REO Account to invest, or if it is a depository
institution, may itself invest, and (iii) the Trustee may direct the depository
institution maintaining the Distribution Account, the Excess Liquidation
Proceeds Reserve Account or the Interest Reserve Account to invest, or if it is
such depository institution, may itself invest, the funds held therein in one or
more Permitted Investments bearing interest or sold at a discount, and maturing,
unless payable on demand, (i) no later than the Business Day immediately
preceding the next succeeding date on which such funds are required to be
withdrawn from such account pursuant to this Agreement, if a Person other than
the depository institution maintaining such account is the obligor thereon, and
(ii) no later than the next succeeding date on which such funds are required to
be withdrawn from such account pursuant to this Agreement, if the depository
institution maintaining such account is the obligor thereon. All such Permitted
Investments shall be held to maturity, unless payable on demand. Any investment
of funds in an Investment Account shall be made in the name of the Trustee (in
its capacity as such). The Master Servicer (with respect to Permitted
Investments of amounts in the Certificate Account, any Lock-Box Account, and any
Cash Collateral Account) and the Special Servicer (with respect to Permitted
Investments of amounts in the REO Account) on behalf of the Trustee, and the
Trustee (with respect to Permitted Investments of amounts in the Distribution
Account, the Excess Liquidation Proceeds Reserve Account and the Interest
Reserve Account), shall (and Trustee hereby designates the Master Servicer and
the Special Servicer, as applicable, as the Person that shall) (i) be the
"entitlement holder" of any Permitted Investment that is a "security
entitlement" and (ii) maintain "control" of any Permitted Investment that is
either a "certificated security" or an "uncertificated security". For purposes
of this Section 3.06(a), the terms "entitlement holder", "security entitlement",
"control", "certificated security" and "uncertificated security" shall have the
meanings given such terms in Revised Article 8 (1994 Revision) of the UCC, and
"control" of any Permitted Investment by the Master Servicer or the Special
Servicer shall constitute "control" by a Person designated by, and acting on
behalf of the Trustee for purposes of Revised Article 8 (1994 Revision) of the
UCC. In the event amounts on deposit in an Investment Account are at any time
invested in a Permitted Investment payable on
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demand, the Master Servicer (in the case of the Certificate Account, any
Lock-Box Account, the Excess Liquidation Proceeds Reserve Account, or any Cash
Collateral Account), the Special Servicer (in the case of the REO Account) and
the Trustee (in the case of the Distribution Account and the Interest Reserve
Account) shall:
(x) consistent with any notice required to be given thereunder, demand
that payment thereon be made on the last day such Permitted Investment may
otherwise mature hereunder in an amount equal to the lesser of (1) all
amounts then payable thereunder and (2) the amount required to be withdrawn
on such date; and
(y) demand payment of all amounts due thereunder promptly upon
determination by the Master Servicer, the Special Servicer or the Trustee,
as the case may be, that such Permitted Investment would not constitute a
Permitted Investment in respect of funds thereafter on deposit in the
Investment Account.
(b) Whether or not the Master Servicer directs the investment of funds in
the Certificate Account, and to the extent the Master Servicer directs the
investment of funds in any Lock-Box Account, the Excess Liquidation Proceeds
Reserve Account or any Cash Collateral Account, interest and investment income
realized on funds deposited in each such Investment Account, to the extent of
the Net Investment Earnings, if any, with respect to such account for each
Collection Period, shall be for the sole and exclusive benefit of the Master
Servicer and shall be subject to its withdrawal, or withdrawal at its direction,
in accordance with Section 3.05(a). Interest and investment income realized on
funds deposited in the Distribution Account and the Interest Reserve Account, to
the extent of Net Investment Earnings, if any, with respect to such account for
each Collection Period, shall be for the sole and exclusive benefit of the
Trustee and shall be subject to its withdrawal in accordance with Section
3.05(b) or (c), as the case may be. Whether or not the Special Servicer directs
the investment of funds in the REO Account, interest and investment income
realized on funds deposited therein, to the extent of the Net Investment
Earnings, if any, for such Investment Account for each Collection Period, shall
be for the sole and exclusive benefit of the Special Servicer and shall be
subject to its withdrawal in accordance with Section 3.16(b). If any loss shall
be incurred in respect of any Permitted Investment on deposit in the Certificate
Account, and to the extent the Master Servicer has discretion to direct the
investment of funds in any Lock-Box Account or any Cash Collateral Account for
its sole and exclusive benefit, the Master Servicer shall deposit therein, no
later than the end of the Collection Period during which such loss was incurred,
without right of reimbursement, the amount of the Net Investment Loss, if any,
with respect to such account for such Collection Period. If any loss shall be
incurred in respect of any Permitted Investment on deposit in the Distribution
Account, the Excess Liquidation Proceeds Reserve Account or the Interest Reserve
Account, the Trustee shall immediately deposit therein, without right of
reimbursement, the amount of the Net Investment Loss, if any, with respect to
such account. If any loss shall be incurred in respect of any Permitted
Investment on deposit in the REO Account, the Special Servicer shall promptly
deposit therein from its own funds, without right of reimbursement, no later
than the end of the Collection Period during which such loss was incurred, the
amount of the Net Investment Loss, if any, for such Collection Period
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(c) Except as otherwise expressly provided in this Agreement, if any
default occurs in the making of a payment due under any Permitted Investment, or
if a default occurs in any other performance required under any Permitted
Investment, the Trustee may and, subject to Section 8.02, upon the request of
Holders of Certificates entitled to a majority of the Voting Rights allocated to
any Class shall take such action as may be appropriate to enforce such payment
or performance, including the institution and prosecution of appropriate
proceedings.
SECTION 3.07 Maintenance of Insurance Policies; Errors and Omissions and
Fidelity Coverage.
(a) Each of the Master Servicer (in the case of Mortgage Loans other than
Specially Serviced Mortgage Loans) and the Special Servicer (in the case of
Specially Serviced Mortgage Loans) shall use reasonable efforts to cause each
Mortgagor to maintain in respect of the related Mortgaged Property all insurance
coverage as is required under the related Mortgage; provided that if any
Mortgage permits the holder thereof to dictate to the Mortgagor the insurance
coverage to be maintained on such Mortgaged Property, the Master Servicer or the
Special Servicer, as appropriate, shall impose such insurance requirements as
are consistent with the Servicing Standard. If a Mortgagor fails to maintain
such insurance, the Master Servicer (at the direction of the Special Servicer in
the case of a Specially Serviced Loan) shall (to the extent available at
commercially reasonable terms) obtain such insurance (which may be through a
master or single interest policy) and the cost (including any deductible
relating to such insurance) of such insurance (or in the case of a master or
single interest policy, the incremental cost (including any deductible relating
to such insurance) of such insurance relating to the specific Mortgaged
Property), shall be a Servicing Advance and shall be recoverable by the Master
Servicer pursuant to Section 3.05(a). If at any time a Mortgaged Property is
located in an area identified in the Flood Hazard Boundary Map or Flood
Insurance Rate Map issued by the Federal Emergency Management Agency as having
special flood hazards or it becomes located in such area by virtue of remapping
conducted by such agency (and flood insurance has been made available), the
Master Servicer (or in the case of a Specially Serviced Loan, the Special
Servicer) shall, if and to the extent that the Mortgage Loan requires the
Mortgagor or permits the mortgagee to require the Mortgagor to do so, use
reasonable efforts to cause the related Mortgagor to maintain a flood insurance
policy meeting the requirements of the current guideline of the Federal
Insurance Administration in the maximum amount of insurance coverage available
under the National Flood Insurance Act or 1968, the Flood Disaster Protection
Act of 1973 or the National Flood Insurance Reform Act of 1994, as amended,
unless otherwise specified by the related Mortgage Loan. If (i) the Mortgagor is
required by the terms of the Mortgage Loan to maintain such insurance (or
becomes obligated by virtue of the related Mortgaged Property becoming located
in such area by virtue of such remapping) or (ii) the terms of the Mortgage Loan
permit the mortgagee to require the Mortgagor to obtain such insurance, the
Master Servicer (or in the case of a Specially Serviced Loan, the Special
Servicer), shall promptly notify the Mortgagor of its obligation to obtain such
insurance. If the Mortgagor fails to obtain such flood insurance within 120 days
of such notification, the Master Servicer (or in the case of a Specially
Serviced Loan, the Special Servicer) shall obtain such insurance, the cost of
which shall be a Servicing Advance and shall be recoverable by the Master
Servicer or Special Servicer pursuant to Section 3.05(a); provided that the
Master Servicer or Special Servicer shall not be required to
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incur any such cost if such Advance would constitute a Nonrecoverable Servicing
Advance. Subject to Section 3.17(a), the Special Servicer shall also use
reasonable efforts to cause to be maintained for each REO Property (to the
extent available at commercially reasonable terms) no less insurance coverage
than was previously required of the Mortgagor under the related Mortgage or as
is consistent with the Servicing Standard. All such insurance policies shall
contain a "standard" mortgagee clause, with loss payable to the Master Servicer
(in the case of Mortgaged Properties) or the Special Servicer (in the case of
REO Properties) on behalf of the Trustee, and shall be issued by an insurer
authorized under applicable law to issue such insurance. Any amounts collected
by the Master Servicer or the Special Servicer under any such policies (other
than amounts to be applied to the restoration or repair of the related Mortgaged
Property or REO Property or amounts to be released to the related Mortgagor, in
each case in accordance with applicable law, the terms of the related Mortgage
Loan documents and the Servicing Standard) shall be deposited in the Certificate
Account, subject to withdrawal pursuant to Section 3.05(a), in the case of
amounts received in respect of a Mortgage Loan, or in the REO Account, subject
to withdrawal pursuant to Section 3.16(c), in the case of amounts received in
respect of an REO Property. Any cost incurred by the Master Servicer or the
Special Servicer in maintaining any such insurance shall not, for purposes
hereof, including, without limitation, calculating monthly distributions to
Certificateholders, be added to the outstanding principal balance of the related
Mortgage Loan, notwithstanding that the terms of such Mortgage Loan so permit,
but shall be recoverable by the Master Servicer as a Servicing Advance pursuant
to Section 3.05(a).
(b) (i) If the Master Servicer or the Special Servicer obtains and
maintains a blanket policy insuring against hazard losses on all of the
Mortgaged Properties and/or REO Properties for which it is responsible to cause
the maintenance of insurance hereunder, then, to the extent such policy provides
protection equivalent to the individual policies otherwise required, the Master
Servicer or the Special Servicer, as the case may be, shall conclusively be
deemed to have satisfied its obligation to cause hazard insurance to be
maintained on such Mortgaged Properties and/or REO Properties. Such policy may
contain a deductible clause (not in excess of a customary amount), in which case
the Master Servicer or the Special Servicer, as appropriate, shall, if there
shall not have been maintained on a Mortgaged Property or an REO Property a
hazard insurance policy complying with the requirements of Section 3.07(a), and
there shall have been one or more losses which would have been covered by such
policy, promptly deposit into the Certificate Account (or into the Servicing
Account if insurance proceeds are to be applied to the repair or restoration of
the applicable Mortgaged Property or disbursed to the related Mortgagor) from
its own funds the amount not otherwise payable under the blanket policy because
of such deductible clause to the extent that any such deductible exceeds the
deductible limitation that pertained to the related Mortgage Loan, or, in the
absence of any such deductible limitation, the deductible limitation which is
consistent with the Servicing Standard. The Master Servicer and the Special
Servicer each agrees to prepare and present, on behalf of itself, the Trustee
and Certificateholders, claims under any such blanket policy maintained by it in
a timely fashion in accordance with the terms of such policy.
(ii) If the Master Servicer or the Special Servicer, as applicable, causes
any Mortgaged Property or REO Property to be covered by a master force placed
insurance policy, which provides protection equivalent to the individual
policies otherwise required, the Master
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Servicer or Special Servicer shall conclusively be deemed to have satisfied its
respective obligations to cause hazard insurance to be maintained on such
Mortgaged Properties and/or REO Properties. Such policy may contain a deductible
clause, in which case the Master Servicer or the Special Servicer, as
applicable, shall in the event that (i) there shall not have been maintained on
the related Mortgaged Property or REO Property a policy otherwise complying with
the provisions of Section 3.07(a), and (ii) there shall have been one or more
losses which would have been covered by such a policy had it been maintained,
immediately deposit into the Certificate Account (or into the Servicing Account
if insurance proceeds are to be applied to the repair or restoration of the
applicable Mortgaged Property or disbursed to the related Mortgagor) from its
own funds the amount not otherwise payable under such policy because of such
deductible to the extent that any such deductible exceeds the deductible
limitation that pertained to the related Mortgage Loan, or, in the absence of
any such deductible limitation, the deductible limitation which is consistent
with the Servicing Standard. The Master Servicer and the Special Servicer each
agrees to prepare and present, on behalf of itself, the Trustee and
Certificateholders, claims under any such master force placed insurance policy
maintained by it in a timely fashion in accordance with the terms of such
policy.
(c) Each of the Master Servicer and the Special Servicer shall obtain and
maintain at its own expense and keep in full force and effect throughout the
term of this Agreement a blanket fidelity bond and an errors and omissions
insurance policy covering its officers and employees and other persons acting on
behalf of it in connection with its activities under this Agreement and naming
the Trustee as an additional insured. The amount of coverage shall be at least
equal to the coverage that would be required by FNMA or FHLMC, whichever is
greater, with respect to the Master Servicer or Special Servicer, as the case
may be, if the Master Servicer or Special Servicer, as the case may be, were
servicing and administering the Mortgage Loans and/or REO Properties for which
it is responsible hereunder for FNMA or FHLMC. Coverage of the Master Servicer
or the Special Servicer under a policy or bond obtained by an Affiliate of such
Person and providing the coverage required by this Section 3.07(c) shall satisfy
the requirements of this Section 3.07(c).
(d) All insurance coverage required to be maintained by the Master Servicer
or Special Servicer, as applicable, under this Section 3.07 shall be obtained
from Qualified Insurers having a claims paying ability rating (or the
obligations of which are guaranteed or backed by a company having such claims
paying ability rating or insurance financial strength rating, as applicable) not
less than (w) two increments (but not less than BBB) below the rating of the
highest rated Certificate from Standard & Poor's (x) A2 by Moody's and (y) if
rated by FITCH IBCA, "A" by FITCH IBCA (or, if not rated by FITCH IBCA, rated
A-IX or better by A.M. Best); provided, however, that the requirements of
clauses (w), (x) and (y) shall not be applicable with respect to Moody's,
Standard & Poor's or FITCH IBCA, as applicable, if the related Rating Agency
shall have confirmed in writing that an insurance company with a lower claims
paying ability rating shall not result, in and of itself, in a downgrade,
qualification on withdrawal of the then current ratings by such Rating Agency of
any class of Certificates.
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SECTION 3.08 Enforcement of Due-On-Sale Clauses; Assumption Agreements;
Subordinate Financing; Defeasance.
(a) As to each Mortgage Loan which contains a provision in the nature of a
"due-on-sale" clause, which by its terms:
(i) provides that such Mortgage Loan shall (or may at the mortgagee's
option) become due and payable upon the sale or other transfer of an interest in
the related Mortgaged Property; or
(ii) provides that such Mortgage Loan may not be assumed without the
consent of the mortgagee in connection with any such sale or other transfer,
then, for so long as such Mortgage Loan is included in the Trust Fund, the
Master Servicer or, in the case of a Specially Serviced Mortgage Loan, the
Special Servicer, on behalf of the Trustee as the mortgagee of record, shall
exercise (or, subject to Section 3.20(a)(iv), waive its right to exercise) any
right it may have with respect to such Mortgage Loan (x) to accelerate the
payments thereon, or (y) to withhold its consent to any such sale or other
transfer, in a manner consistent with the Servicing Standard. In the event that
the Master Servicer or Special Servicer intends or is required, in accordance
with the preceding sentence, the Mortgage Loan documents or applicable law, to
permit the transfer of any Mortgaged Property, the Master Servicer or the
Special Servicer, as the case may be, if consistent with the Servicing Standard,
may enter into an assumption and modification agreement with the Person to whom
the related Mortgaged Property has been or is intended to be conveyed or may
enter into substitution of liability agreement, pursuant to which the original
Mortgagor and any original guarantors are released from liability, and the
transferee and any new guarantors are substituted therefor and become liable
under the Mortgage Note and any related guaranties and, in connection therewith,
may require from the related Mortgagor a reasonable and customary fee for the
additional services performed by it, together with reimbursement for any related
costs and expenses incurred by it (but only to the extent that charging such fee
and entering into such assumption and modification agreement will not be a
significant modification of the Mortgage Loan for purposes of the REMIC
Provisions). The Master Servicer or the Special Servicer, as the case may be,
shall promptly notify the Trustee of any such agreement and forward the original
thereof to the Trustee for inclusion in the related Mortgage File. Subject to
Section 3.20(a), if the Master Servicer or Special Servicer intends or is
required to permit the transfer of any Mortgaged Property and enter into an
assumption agreement or a substitution of liability agreement, as the case may
be, in accordance with the foregoing, the Master Servicer or the Special
Servicer, as the case may be, prior to entering into such agreement, shall
submit to (A) FITCH IBCA, in the case of any Mortgage Loan that has, or any
Mortgage Loan that is part of a Related Borrower Group that has, one of the
then-ten highest outstanding principal balances in the Mortgage Pool; and (B)
Standard & Poor's and Moody's, in the case of any Mortgage Loan that has an
outstanding principal balance in excess of the lesser of (1) $20,000,000 or (2)
1.5% of the then outstanding principal balance of the Mortgage Pool a copy of
such documentation and any information with respect to such action as the Master
Servicer or Special Servicer, as applicable, deems appropriate or as such Rating
Agency may reasonably request, and shall request that such Rating Agency deliver
to the
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Master Servicer or Special Servicer, as applicable, Rating Agency Confirmation
with respect to the execution of such agreement within five (5) Business Days of
receipt of a copy of such documentation and any information such Rating Agency
so reasonably requests; provided, however, if the Master Servicer or Special
Servicer shall not have received such written confirmation from FITCH IBCA
within five (5) Business Days of such Rating Agency's receipt of a copy of such
documentation and such information, such written confirmation shall be deemed to
have been delivered to the Master Servicer or Special Servicer by FITCH IBCA.
(b) As to each Mortgage Loan which contains a provision in the nature of a
"due-on-encumbrance" clause, which by its terms:
(i) provides that such Mortgage Loan shall (or may at the mortgagee's
option) become due and payable upon the creation of any additional lien or other
encumbrance on the related Mortgaged Property; or
(ii) requires the consent of the mortgagee to the creation of any such
additional lien or other encumbrance on the related Mortgaged Property,
then, for so long as such Mortgage Loan is included in the Trust Fund, the
Master Servicer or, in the case of a Specially Serviced Mortgage Loan, the
Special Servicer, on behalf of the Trustee as the mortgagee of record, shall
exercise (or, subject to Section 3.20(a)(iv), waive its right to exercise) any
right it may have with respect to such Mortgage Loan (x) to accelerate the
payments thereon, or (y) to withhold its consent to the creation of any such
additional lien or other encumbrance, in a manner consistent with the Servicing
Standard; provided, however that the Master Servicer or, in the case of a
Specially Serviced Mortgage Loan, the Special Servicer, shall not waive its
right to exercise any such right when such right arises as a result of the
imposition of a lien against a Mortgaged Property which lien secures additional
indebtedness or a mechanic's or similar lien not permitted under the related
Mortgage Loan documents unless, the Master Servicer or the Special Servicer, as
the case may be, prior to waiving any such right, shall submit to (A) FITCH IBCA
(but only in the case of any Mortgage Loan that has, or any Mortgage Loan that
is part of a Related Borrower Group that has, one of the then-ten highest
outstanding principal balances in the Mortgage Pool), (B) Standard & Poor's (in
all cases), and (C) Moody's (in the case of any Mortgage Loan that has an
outstanding principal balance in excess of the lesser of (1) $20,000,000 or (2)
1.5% of the then outstanding principal balance of the Mortgage Pool) a copy of
the documentation under which any such lien would arise together with such other
information with respect to such proposed waiver as the Master Servicer or
Special Servicer, as applicable, deems appropriate or as such Rating Agency may
reasonably request, and shall request that such Rating Agency deliver to the
Master Servicer or Special Servicer, as applicable, Rating Agency Confirmation
with respect to such proposed waiver within five (5) Business Days of receipt of
a copy of such documentation and any information such Rating Agency so
reasonably requests; provided, however, if the Master Servicer or Special
Servicer shall not have received such written confirmation from FITCH IBCA
within five (5) Business Days of such Rating Agency's receipt of a copy of such
documentation and such information, such written confirmation shall be deemed to
have been delivered to the Master Servicer or Special Servicer by FITCH IBCA.
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(c) With respect to any Mortgage Loan which permits release of Mortgaged
Properties through a Defeasance Option or with respect to the application of
amounts held in any earnout or other reserve accounts, the Master Servicer
shall, to the extent consistent with and permitted by the applicable Mortgage
Loan documents, permit (or, if the terms of such Mortgage Loan permit the lender
to require defeasance, the Master Servicer shall require) the exercise of such
Defeasance Option on any Due Date occurring more than two years after the
Startup Day (the "Release Date") subject to the following conditions:
(i) No event of default exists under the related Mortgage Note;
(ii) The Mortgagor pays on such Release Date (A) all interest accrued and
unpaid on the Principal Balance of the Mortgage Note to and including the
Release Date; (B) all other sums, excluding scheduled interest or principal
payments due under the Mortgage Note and (C) any costs and expenses incurred in
connection with such release;
(iii) The Mortgagor has delivered Defeasance Collateral providing payments
on or prior to all successive scheduled payment dates from the Release Date to
the related Maturity Date, and in an amount equal to or greater than the
scheduled payments due on such dates under the Mortgage Loan;
(iv) The Mortgagor shall have delivered a security agreement granting the
Trust Fund a first priority security interest in the Defeasance Collateral;
(v) The Master Servicer shall have received an Opinion of Counsel from the
related Mortgagor (which shall be an expense of the related Mortgagor) to the
effect that the Trust Fund has a first priority security interest in the
Defeasance Collateral and that the assignment thereof is valid and enforceable;
(vi) The Master Servicer shall have obtained at the related Mortgagor's
expense a certificate from an Independent certified public accountant certifying
that the Defeasance Collateral complies with the requirements of the related
Mortgage Note;
(vii) The Master Servicer shall have obtained an Opinion of Counsel from
the related Mortgagor to the effect that such release will not cause any of
REMIC I, REMIC II or REMIC III to fail to qualify as a REMIC at any time that
any Certificates are outstanding or cause a tax to be imposed on the Trust Fund
under the REMIC Provisions;
(viii) The Borrower shall have provided evidence to the Master Servicer
demonstrating that the lien of the related Mortgage is being released to
facilitate the disposition of the Mortgaged Property or another customary
commercial transaction, and not as part of an arrangement to collateralize the
Certificates issued by the related REMIC with obligations that are not real
estate mortgages; and
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(ix) If required by the terms of such Mortgage Loan, the Master Servicer
shall have received Rating Agency Confirmation from each of FITCH IBCA and
Standard & Poor's with respect to the exercise of such Defeasance Option.
(d) Nothing in this Section 3.08 shall constitute a waiver of the Trustee's
right, as the mortgagee of record, to receive notice of any assumption of a
Mortgage Loan, any sale or other transfer of the related Mortgaged Property or
the creation of any additional lien or other encumbrance with respect to such
Mortgaged Property.
(e) Except as otherwise permitted by Section 3.20, neither the Master
Servicer nor the Special Servicer shall agree to modify, waive or amend any term
of any Mortgage Loan in connection with the taking of, or the failure to take,
any action pursuant to this Section 3.08.
SECTION 3.09 Realization Upon Defaulted Mortgage Loans.
(a) The Master Servicer shall notify the Special Servicer of the occurrence
of a Servicing Transfer Event in respect of any Mortgage Loan. The Special
Servicer shall monitor such Specially Serviced Mortgage Loan, evaluate whether
the causes of the default can be corrected over a reasonable period without
significant impairment of the value of the related Mortgaged Property, initiate
corrective action in cooperation with the Mortgagor if, in the Special
Servicer's judgment, cure is likely, and take such other actions (including
without limitation, negotiating and accepting a discounted payoff of a Mortgage
Loan) as are consistent with the Servicing Standard. If, in the Special
Servicer's judgment, such corrective action has been unsuccessful, no
satisfactory arrangement can be made for collection of delinquent payments, and
the Defaulted Mortgage Loan has not been released from the Trust Fund pursuant
to any provision hereof, then the Special Servicer shall, subject to subsections
(b) through (d) of this Section 3.09, exercise reasonable efforts, consistent
with the Servicing Standard, to foreclose upon or otherwise comparably convert
(which may include an REO Acquisition) the ownership of property securing such
Mortgage Loan. The foregoing is subject to the provision that, in any case in
which a Mortgaged Property shall have suffered damage from an Uninsured Cause,
the Master Servicer and the Special Servicer shall have the right but not the
obligation to expend its own funds toward the restoration of such property if it
shall determine in its reasonable discretion (i) that such restoration will
increase the net proceeds of liquidation of such Mortgaged Property to
Certificateholders after reimbursement to itself for such expenses, and (ii)
that such expenses will be recoverable by the Master Servicer or Special
Servicer, as the case may be, out of the proceeds of liquidation of such
Mortgaged Property, as contemplated in Section 3.05(a). The Special Servicer
(or, subject to Section 3.19(c), the Master Servicer) shall advance all other
costs and expenses incurred by it in any such proceedings, subject to its being
entitled to reimbursement therefor as a Servicing Advance as provided in Section
3.05(a) and further subject to its being entitled to pay out of the related
Liquidation Proceeds any Liquidation Expenses incurred in respect of any
Mortgage Loan, which Liquidation Expenses were outstanding at the time such
proceeds are received. When applicable state law permits the Special Servicer to
select between judicial and non-judicial foreclosure in respect of any Mortgaged
Property, the Special Servicer shall make such selection in a manner consistent
with the Servicing Standard. Nothing contained in this Section 3.09 shall be
construed so as to require the Special Servicer, on behalf of
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the Trust Fund, to make a bid on any Mortgaged Property at a foreclosure sale or
similar proceeding that is in excess of the fair market value of such property,
as determined by the Special Servicer in its sole judgment taking into account
the factors described in Section 3.18(e) and the results of any Appraisal
obtained pursuant to this Agreement, all such bids to be made in a manner
consistent with the Servicing Standard. If and when the Master Servicer or the
Special Servicer deems it necessary and prudent for purposes of establishing the
fair market value of any Mortgaged Property securing a Defaulted Mortgage Loan,
whether for purposes of bidding at foreclosure or otherwise, the Master Servicer
or the Special Servicer, as the case may be, is authorized to have an Appraisal
performed with respect to such property (the cost of which Appraisal shall be
covered by, and reimbursable as, an Additional Trust Fund Expense).
(b) The Special Servicer shall not acquire any personal property pursuant
to this Section 3.09 (with the exception of cash or cash equivalents pledged as
collateral for a Mortgage Loan) unless either:
(i) such personal property is incident to real property (within the meaning
of Section 856(e)(1) of the Code) so acquired by the Special Servicer; or
(ii) the Special Servicer shall have obtained an Opinion of Counsel (the
cost of which may be withdrawn from the Certificate Account pursuant to Section
3.05(a)) to the effect that the holding of such personal property by the Trust
Fund will not (subject to Section 10.01(f)) cause the imposition of a tax on the
Trust Fund under the REMIC Provisions or cause any of REMIC I, REMIC II or REMIC
III to fail to qualify as a REMIC at any time that any Certificate is
outstanding.
(c) Notwithstanding the foregoing provisions of this Section 3.09, the
Special Servicer shall not, on behalf of the Trustee, initiate foreclosure
proceedings, obtain title to a Mortgaged Property in lieu of foreclosure or
otherwise, have a receiver of rents appointed with respect to any Mortgaged
Property, or take any other action with respect to any Mortgaged Property, if,
as a result of any such action, the Trustee, on behalf of the
Certificateholders, would be considered to hold title to, to be a
"mortgagee-in-possession" of, or to be an "owner" or "operator" of such
Mortgaged Property within the meaning of CERCLA or any comparable law, unless
(as evidenced by an Officer's Certificate to such effect delivered to the
Trustee) the Special Servicer has previously received an Environmental
Assessment in respect of such Mortgaged Property prepared within the twelve
months preceding such determination by a Person who regularly conducts
Environmental Assessments and the Special Servicer, based solely (as to
environmental matters and related costs) on the information set forth in such
Environmental Assessment, determines that:
(i) the Mortgaged Property is in compliance with applicable environmental
laws and regulations or, if not, that acquiring such Mortgaged Property and
taking such actions as are necessary to bring the Mortgaged Property in
compliance therewith is reasonably likely to produce a greater recovery to
Certificateholders on a present value basis than not acquiring such Mortgaged
Property and not taking such actions; and
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(ii) there are no circumstances or conditions present at the Mortgaged
Property relating to the use, management or disposal of Hazardous Materials for
which investigations, testing, monitoring, containment, clean-up or remediation
could be required under any applicable environmental laws and regulations or, if
such circumstances or conditions are present for which any such action could be
required, that acquiring such Mortgaged Property and taking such actions with
respect to such Mortgaged Property is reasonably likely to produce a greater
recovery to Certificateholders on a present value basis than not acquiring such
Mortgaged Property and not taking such actions.
The cost of any such Environmental Assessment, as well as the cost of any
remedial, corrective or other further action contemplated by clause (i) and/or
clause (ii) of the preceding sentence, may be withdrawn from the Certificate
Account by the Master Servicer at the direction of the Special Servicer as an
expense of the Trust Fund pursuant to Section 3.05(a); and if any such
Environmental Assessment so warrants, the Special Servicer shall, at the expense
of the Trust Fund, perform such additional environmental testing as are
consistent with the Servicing Standard to determine whether the conditions
described in clauses (i) and (ii) of the preceding sentence have been satisfied.
(d) If the environmental testing contemplated by subsection (c) above
establishes that either of the conditions set forth in clauses (i) and (ii) of
the first sentence thereof has not been satisfied with respect to any Mortgaged
Property securing a Defaulted Mortgage Loan, then the Special Servicer shall
take such action as it deems to be in the best economic interest of the Trust
Fund (other than proceeding to acquire title to the Mortgaged Property) and is
hereby authorized at such time as it deems appropriate to release all or a
portion of such Mortgaged Property from the lien of the related Mortgage.
(e) The Special Servicer shall provide written reports monthly to the
Master Servicer, (who shall forward such reports to the Trustee, who shall
forward such reports to the Certificateholders) regarding any actions taken by
the Special Servicer with respect to any Mortgaged Property securing a Defaulted
Mortgage Loan as to which the environmental testing contemplated in subsection
(c) above has revealed that either of the conditions set forth in clauses (i)
and (ii) of the first sentence thereof has not been satisfied, in each case
until the earliest to occur of satisfaction of both such conditions, removal of
the related Mortgage Loan from the Trust Fund and release of the lien of the
related Mortgage on such Mortgaged Property.
(f) The Special Servicer shall report to the Internal Revenue Service and
the related Mortgagor, in the manner required by applicable law, the information
required to be reported regarding any Mortgaged Property which is abandoned or
foreclosed, information returns with respect to the receipt of mortgage
interests received in a trade or business and the information returns relating
to cancellation of indebtedness income with respect to any Mortgaged Property
required by Sections 6050J, 6050H and 6050P, respectively, of the Code. Such
reports shall be in form and substance sufficient to meet the reporting
requirements imposed by Sections 6050J, 6050H and 6050P of the Code. The Special
Servicer shall deliver a copy of any such report upon request to the Trustee.
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(g) The Special Servicer shall have the right to determine, in accordance
with the Servicing Standard, the advisability of the maintenance of an action to
obtain a deficiency judgment if the state in which the Mortgaged Property is
located and the terms of the Mortgage Loan permit such an action.
(h) The Special Servicer shall maintain accurate records of each Final
Recovery Determination in respect of a Defaulted Mortgage Loan or REO Property
and the basis thereof. Each Final Recovery Determination shall be evidenced by
an Officer's Certificate delivered to the Trustee no later than the 10th
Business Day following such Final Recovery Determination.
SECTION 3.10 Trustee to Cooperate; Release of Mortgage Files.
(a) Upon the payment in full of any Mortgage Loan, or the receipt by the
Master Servicer or the Special Servicer of a notification that payment in full
shall be escrowed in a manner customary for such purposes, the Master Servicer
or the Special Servicer, as the case may be, will immediately notify the Trustee
and request delivery of the related Mortgage File. Any such notice and request
shall be in the form of a Request for Release signed by a Servicing Officer and
shall include a statement to the effect that all amounts received or to be
received in connection with such payment which are required to be deposited in
the Certificate Account pursuant to Section 3.04(a) have been or will be so
deposited. Within seven Business Days (or within such shorter period as release
can reasonably be accomplished if the Master Servicer or the Special Servicer
notifies the Trustee of an exigency) of receipt of such notice and request, the
Trustee shall release, or cause any related Custodian to release, the related
Mortgage File to the Master Servicer or the Special Servicer, whichever
requested it. No expenses incurred in connection with any instrument of
satisfaction or deed of reconveyance shall be chargeable to the Certificate
Account.
(b) From time to time as is appropriate for servicing or foreclosure of any
Mortgage Loan, the Master Servicer or the Special Servicer may deliver to the
Trustee a Request for Release signed by a Servicing Officer thereof. Upon
receipt of the foregoing, the Trustee shall deliver or cause the related
Custodian to deliver, the Mortgage File or any document therein to the Master
Servicer or the Special Servicer, as the case may be. Upon return of such
Mortgage File or such document to the Trustee or the related Custodian, or the
delivery to the Trustee of a certificate of a Servicing Officer stating that
such Mortgage Loan was liquidated and that all amounts received or to be
received in connection with such liquidation which are required to be deposited
into the Certificate Account pursuant to Section 3.04(a) have been or will be so
deposited, or that such Mortgage Loan has become an REO Property, the Request
for Release shall be released by the Trustee to the Master Servicer or the
Special Servicer, as applicable.
(c) Within three Business Days (or within such shorter period as delivery
can reasonably be accomplished if the Special Servicer notifies the Trustee of
an exigency) of receipt thereof, the Trustee shall execute and deliver to the
Special Servicer any court pleadings, requests for trustee's sale or other
documents necessary to the foreclosure or trustee's sale in respect of a
Mortgaged Property or to any legal action brought to obtain judgment against any
Mortgagor on the Mortgage Note or Mortgage or to obtain a deficiency judgment,
or to enforce any other remedies
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or rights provided by the Mortgage Note or Mortgage or otherwise available at
law or in equity. The Special Servicer shall be responsible for the preparation
of all such documents and pleadings. When submitted to the Trustee for
signature, such documents or pleadings shall be accompanied by a certificate of
a Servicing Officer requesting that such pleadings or documents be executed by
the Trustee and certifying as to the reason such documents or pleadings are
required and that the execution and delivery thereof by the Trustee will not
invalidate or otherwise affect the lien of the Mortgage, except for the
termination of such a lien upon completion of the foreclosure or trustee's sale.
SECTION 3.11 Servicing Compensation; Nonrecoverable Servicing Advances.
(a) As compensation for its activities hereunder, the Master Servicer shall
be entitled to receive the Servicing Fee with respect to each Mortgage Loan and
REO Loan. As to each Mortgage Loan and REO Loan, the Servicing Fee shall accrue
from time to time at the Servicing Fee Rate and shall be computed on the same
basis and the same principal amount respecting which any related interest
payment due on such Mortgage Loan or deemed to be due on such REO Loan is
computed. The Servicing Fee with respect to any Mortgage Loan or REO Loan shall
cease to accrue if a Liquidation Event occurs in respect thereof. The Servicing
Fee shall be payable monthly, on a loan-by-loan basis, from payments of interest
on each Mortgage Loan, REO Revenues allocable as interest on each REO Loan and
the interest portion of Delinquency Advances on each Mortgage Loan and REO Loan.
The Master Servicer shall be entitled to recover unpaid Servicing Fees in
respect of any Mortgage Loan or REO Loan out of that portion of related
Insurance Proceeds or Liquidation Proceeds allocable as recoveries of interest,
to the extent permitted by Section 3.05(a). The right to receive the Servicing
Fee may not be transferred in whole or in part except in connection with the
transfer of all of the Master Servicer's responsibilities and obligations under
this Agreement.
(b) Additional servicing compensation in the form of assumption fees,
modification fees, charges for beneficiary statements or demands, amounts
collected for checks returned for insufficient funds and any similar or
ancillary fees (excluding any other amounts relating to Prepayment Premiums), in
each case to the extent actually paid by a Mortgagor with respect to a Mortgage
Loan that is not a Specially Serviced Mortgage Loan, may be retained by the
Master Servicer and are not required to be deposited in the Certificate Account.
The Master Servicer shall also be entitled to additional servicing compensation
in the form of (i) any Prepayment Interest Excesses, Balloon Payment Interest
Excesses, and further to the extent received on Mortgage Loans other than
Specially Serviced Mortgage Loans, any Penalty Charges not allocable to pay
Advance Interest collected on the Mortgage Loans; (ii) interest or other income
earned on deposits in the Investment Accounts (other than the REO Account), in
accordance with Section 3.06(b) (but only to the extent of the Net Investment
Earnings, if any, with respect to each such Investment Account for each
Collection Period), and (iii) to the extent not required to be paid to any
Mortgagor under applicable law or under the related Mortgage, any interest or
other income earned on deposits in the Servicing Accounts and Reserve Accounts
maintained thereby. The Master Servicer shall be required to pay out of its own
funds all overhead and general and administrative
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expenses incurred by it in connection with its servicing activities hereunder
(including, without limitation, payment of any amounts due and owing to any of
Sub-Servicers retained by it and the premiums for any blanket policy insuring
against hazard losses pursuant to Section 3.07(b)), if and to the extent such
expenses are not payable directly out of the Certificate Account, and the Master
Servicer shall not be entitled to reimbursement therefor except as expressly
provided in this Agreement.
(c) As compensation for its activities hereunder, the Special Servicer
shall be entitled to receive the Special Servicing Fee with respect to each
Specially Serviced Mortgage Loan and each REO Loan. As to each Specially
Serviced Mortgage Loan and each REO Loan, the Special Servicing Fee shall accrue
from time to time at the Special Servicing Fee Rate on the same basis and the
same principal amount respecting which any related interest payment due on such
Specially Serviced Mortgage Loan or deemed to be due on such REO Loan is
computed. The Special Servicing Fee with respect to each Specially Serviced
Mortgage Loan and each REO Loan shall cease to accrue as of the date a
Liquidation Event occurs in respect thereof. As to each Specially Serviced
Mortgage Loan and each REO Loan, earned but unpaid Special Servicing Fees shall
be payable monthly out of general collections on the Mortgage Loans and any REO
Properties on deposit in the Certificate Account pursuant to Section 3.05(a).
As further compensation for its activities hereunder, the Special Servicer
shall be entitled to receive the Workout Fee with respect to each Corrected
Mortgage Loan. As to each Corrected Mortgage Loan, the Workout Fee shall be
payable from, and shall be calculated by application of the Workout Fee Rate to,
each collection of interest and principal received on such Mortgage Loan for so
long as it remains a Corrected Mortgage Loan. The Workout Fee with respect to
any Corrected Mortgage Loan will cease to be payable if a Servicing Transfer
Event occurs with respect thereto or if the related Mortgaged Property becomes
an REO Property; provided that a new Workout Fee will become payable if and when
such Mortgage Loan again becomes a Corrected Mortgage Loan. If the Special
Servicer is terminated other than for cause or resigns in accordance with
Section 6.04, it shall retain the right to receive any and all Workout Fees
payable in respect of Mortgage Loans that became Corrected Mortgage Loans during
the period that it acted as Special Servicer and were still such at the time of
such termination or resignation (and the successor Special Servicer shall not be
entitled to any portion of such Workout Fees), in each case until the Workout
Fee for any such loan ceases to be payable in accordance with the preceding
sentence.
As further compensation for its activities hereunder, the Special Servicer
shall also be entitled to receive a Liquidation Fee with respect to each
Specially Serviced Mortgage Loan or REO Property as to which it receives any
full or discounted payoff or any Liquidation Proceeds (other than in connection
with the purchase of any such Specially Serviced Mortgage Loan or REO Property
by the Special Servicer or the Majority Certificateholder of the Controlling
Class pursuant to Section 3.18 or by the Master Servicer or the Depositor
pursuant to Section 3.18 or by the Master Servicer or the Depositor pursuant to
Section 9.01). As to each such Specially Serviced Mortgage Loan or REO Property,
the Liquidation Fee shall be payable from, and shall be calculated by
application of the Liquidation Fee Rate to, such full or discounted payoff
and/or such Liquidation Proceeds. No Liquidation Fee will be payable with
respect to any Specially Serviced Mortgage
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Loan solely by virtue of such Mortgage Loan becoming a Corrected Mortgage Loan.
Notwithstanding anything herein to the contrary, no Liquidation Fee will be
payable from, or based upon the receipt of, Liquidation Proceeds collected as a
result of any purchase of a Specially Serviced Mortgage Loan or REO Property
described in the parenthetical to the first sentence of this paragraph;
provided, however, that if any such Liquidation Proceeds are received with
respect to any Corrected Mortgaged Loan, and the Special Servicer is properly
entitled to a Workout Fee therefrom, such Workout Fee will be payable based on
and from the portion of such Liquidation Proceeds that constitute principal
and/or interest.
Notwithstanding anything to the contrary herein, a Liquidation Fee and a
Workout Fee relating to the same Mortgage Loan shall not be paid from the same
proceeds on or with respect to such Mortgage Loan.
Subject to the Special Servicer's right to employ Sub-Servicers, the
Special Servicer's right to receive the Special Servicing Fee, the Workout Fee
and/or the Liquidation Fee may not be transferred in whole or in part except in
connection with the transfer of all of the Special Servicer's responsibilities
and obligations under this Agreement.
(d) Additional servicing compensation in the form of assumption fees and
modification fees received on or with respect to Specially Serviced Mortgage
Loans shall be promptly paid to the Special Servicer by the Master Servicer and
shall not be required to be deposited in the Certificate Account pursuant to
Section 3.04(a). Additional servicing compensation in the form of assumption
fees and modification fees that the Master Servicer is entitled to and that are
collected by the Special Servicer, shall be paid promptly to the Master Servicer
by the Special Servicer. The Special Servicer shall also be entitled to
additional servicing compensation in the form of: (i) to the extent not required
to be paid to any Mortgagor under applicable law, any interest or other income
earned on deposits in the REO Account, any Servicing Accounts and any Reserve
Accounts maintained thereby; and (ii) to the extent not required to be paid to
the Master Servicer as additional servicing compensation pursuant to Section
3.11(b), any Penalty Charges (to the extent not allocable to pay Advance
Interest) collected on the Specially Serviced Mortgage Loans and REO Loans. The
Special Servicer shall be required to pay out of its own funds all overhead and
general and administrative expenses incurred by it in connection with its
servicing activities hereunder (including, without limitation, payment of any
amounts due and owing to any Sub-Servicers retained by it and the premiums for
any blanket policy obtained by it insuring against hazard losses pursuant to
Section 3.07(b)), if and to the extent such expenses are not payable directly
out of the Certificate Account or the REO Account, and the Special Servicer
shall not be entitled to reimbursement except as expressly provided in this
Agreement.
(e) If the Master Servicer or Special Servicer is required under this
Agreement to make a Servicing Advance, but neither does so within 15 days after
such Advance is required to be made, the Trustee shall, to the extent a
Responsible Officer of the Trustee has actual knowledge of such failure by the
Master Servicer or the Special Servicer to make such Advance (subject to Section
3.11(g) below), make such Advance. If the Trustee fails to make a Servicing
Advance required to be made by it, the Fiscal Agent shall make such advance
(subject to Section 3.11(g)
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below) within one (1) Business Day of such failure by the Trustee. The making of
such Advance by the Fiscal Agent shall cure the failure by the Trustee to make
such Advance.
(f) The Master Servicer, the Special Servicer, the Trustee and the Fiscal
Agent shall each be entitled to receive interest at the Reimbursement Rate in
effect from time to time, accrued on the amount of each Servicing Advance made
thereby for so long as such Servicing Advance is outstanding, payable, first,
out of Penalty Charges received on the Mortgage Loan or REO Loan as to which
such Servicing Advance was made and, then, once such Servicing Advance has been
reimbursed pursuant to Section 3.05, out of general collections on the Mortgage
Loans and REO Properties.
(g) Notwithstanding anything to the contrary set forth herein, none of the
Master Servicer, the Special Servicer, the Trustee or the Fiscal Agent shall be
required to make any Servicing Advance that it determines in its reasonable,
good faith judgment would constitute a Nonrecoverable Servicing Advance;
provided, however, that the Special Servicer may make an Emergency Advance
notwithstanding that, at the time such Advance is made, the Special Servicer may
not have adequate information available in order to make a determination whether
or not such advance would, if made, be a Nonrecoverable Servicing Advance. In
addition, Nonrecoverable Servicing Advances (including any Emergency Advances
made pursuant to the proviso of the preceding sentence which are ultimately
determined to be Nonrecoverable Servicing Advances) shall be reimbursable
pursuant to Section 3.05 out of general collections on the Mortgage Loans and
REO Properties on deposit in the Certificate Account. The determination by the
Master Servicer, the Special Servicer or, if applicable, the Trustee or the
Fiscal Agent, that it has made a Nonrecoverable Servicing Advance or that any
proposed Servicing Advance, if made, would constitute a Nonrecoverable Servicing
Advance, shall be evidenced by an Officer's Certificate delivered promptly to
the Trustee (or, if applicable, retained thereby) and the Depositor, setting
forth the basis for such determination, together with (if such determination is
prior to the liquidation of the related Mortgage Loan or REO Property) a copy of
an Appraisal of the related Mortgaged Property or REO Property, as the case may
be, which shall have been performed within the twelve months preceding such
determination, and further accompanied by any other information, including,
without limitation, engineers' reports, environmental surveys, inspection
reports, rent rolls, income and expense statements or similar reports, that the
Master Servicer or the Special Servicer may have obtained and that supports such
determination. If such an Appraisal shall not have been required and performed
pursuant to the terms of this Agreement, the Master Servicer, the Special
Servicer, the Trustee or the Fiscal Agent, as the case may be, may, subject to
its reasonable and good faith determination that such Appraisal will demonstrate
the nonrecoverability of the related Advance, obtain an Appraisal for such
purpose at the expense of the Trust Fund. The Trustee or the Fiscal Agent shall
be entitled to rely on any determination of nonrecoverability that may have been
made by the Master Servicer or the Special Servicer with respect to a particular
Servicing Advance, and the Master Servicer shall be entitled to rely on any
determination of nonrecoverability that may have been made by the Special
Servicer with respect to a particular Servicing Advance.
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SECTION 3.12 Inspections; Collection of Financial Statements.
(a) The Master Servicer shall perform (or cause to be performed) a physical
inspection of each Mortgaged Property (other than Mortgaged Properties
constituting collateral for Specially Serviced Mortgaged Loans) at such times
and in such manner as are consistent with the Servicing Standard, but in any
event at least once every two years or, if the related Mortgage Loan has a
current balance of greater than $2,000,000, at least once every year except, in
the case of a Credit Lease Loan, at least once every three years if the related
Tenant or its Guarantor has a published rating of not less than BBB- or its
equivalent from any nationally-recognized rating agency, every two years, if the
related Tenant or its guarantor has a published rating between BB+ and BB- or
its equivalent from any nationally-recognized rating agency, and annually if the
related Tenant or its Guarantor has a published rating of less than BB- or its
equivalent from any nationally-recognized rating agency. Notwithstanding the
foregoing, the Master Servicer shall perform (or cause to be performed) annually
a physical inspection of each Mortgaged Property for which no published rating
is publicly available for the related Tenant under each Credit Lease Loan that
represents 5% or more of the initial principal balance of the Mortgage Pool, and
will inspect or cause to be inspected every second year each other Mortgaged
Property for which the related Tenant or its Guarantor has no published publicly
available rating.). The Master Servicer shall prepare (or cause to be prepared)
a written report of each such inspection detailing the condition of the
Mortgaged Property and specifying the existence of (i) any vacancy in the
Mortgaged Property evident from such inspection that the Master Servicer deems
material, (ii) any sale, transfer or abandonment of the Mortgaged Property
evident from such inspection, (iii) any adverse change in the condition or value
of the Mortgaged Property evident from such inspection that the Master Servicer
deems material, or (iv) any waste committed on the Mortgaged Property evident
from such inspection. The Master Servicer, upon request, shall deliver to the
Trustee a copy of each such written report. In the event the published rating
for any Tenant or Guarantor is downgraded by any of Standard & Poor's, Xxxxx'x
or FITCH IBCA by one or more rating increments (e.g. AA to A) and no inspection
has been performed due to a ratings downgrade in the preceding twelve months for
the related Mortgaged Property, then in each such instance, the Master Servicer
or Special Servicer, as applicable, shall cause all Mortgaged Properties leased
to such Tenant to be inspected as soon as reasonably practical and, thereafter,
in accordance with the first sentence of this clause (a).
(b) The Special Servicer shall perform (or cause to be performed) a
physical inspection of each Mortgaged Property constituting collateral for a
Specially Serviced Mortgage Loan at such times and in such manner as are
consistent with the Servicing Standard. If any Mortgage Loan becomes a Specially
Serviced Mortgage Loan, then as soon as practicable (and in any event within 90
days thereafter) the Special Servicer shall perform (or cause to be performed) a
physical inspection of each Mortgaged Property constituting collateral for such
Mortgage Loan. The Special Servicer shall prepare (or cause to be prepared) a
written report of each such inspection detailing the condition of the Mortgaged
Property and specifying the existence of (i) any vacancy in the Mortgaged
Property evident from such inspection that the Special Servicer deems material,
(ii) any sale, transfer or abandonment of the Mortgaged Property evident from
such inspection, (iii) any adverse change in the condition or value of the
Mortgaged Property evident from such
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inspection that the Special Servicer deems material, or (iv) any waste committed
on the Mortgaged Property evident from such inspection. The Special Servicer,
upon request, shall deliver to the Trustee and the Master Servicer a copy of
each such written report.
(c) The Master Servicer (or, in the case of Specially Serviced Mortgage
Loans, the Special Servicer) shall make reasonable efforts to collect promptly
from each Mortgagor (other than a Mortgagor on a Credit Lease Loan) quarterly
and annual operating statements and rent rolls of the related Mortgaged
Property. In addition, the Special Servicer shall make reasonable efforts to
obtain quarterly and annual operating statements and rent rolls with respect to
each REO Property. The Master Servicer and Special Servicer, upon request, shall
each deliver copies of the collected items to the other such party and the
Trustee in each case within 10 days of its receipt of such request.
SECTION 3.13 Annual Statement as to Compliance.
Each of the Master Servicer and the Special Servicer will deliver to the
Trustee, with a copy to the Depositor, on or before April 30th of each year,
beginning in 2000, an Officer's Certificate stating, as to the signer thereof,
that (i) a review of the activities of the Master Servicer or the Special
Servicer, as the case may be, during the preceding calendar year and of its
performance under this Agreement has been made under such officer's supervision,
(ii) to the best of such officer's knowledge, based on such review, the Master
Servicer or the Special Servicer, as the case may be, has fulfilled in all
material respects its obligations under this Agreement throughout such year, or,
if there has been a default in the fulfillment of any such obligation,
specifying each such default known to such officer and the nature and status
thereof and (iii) the Master Servicer or the Special Servicer, as the case may
be, has received no notice regarding qualification, or challenging the status,
of the Trust Fund as a REMIC or of the Grantor Trust as a "grantor trust" under
the Grantor Trust Provisions from the Internal Revenue Service or any other
governmental agency or body or, if it has received any such notice, specifying
the details thereof. A copy of such Officer's Certificate may be obtained by
Certificateholders upon written request to the Trustee pursuant to Section 8.12
hereof.
SECTION 3.14 Reports by Independent Public Accountants.
On or before April 30th of each year, beginning in 2000, the Master
Servicer at its expense shall cause a firm of independent public accountants
(which may also render other services to the Master Servicer) and that is a
member of the American Institute of Certified Public Accountants to furnish a
statement to the Trustee and to the Depositor to the effect that (i) it has
obtained a letter of representation regarding certain matters from the
management of the Master Servicer, which includes an assertion that the Master
Servicer has complied with certain minimum mortgage loan servicing standards (to
the extent applicable to commercial and multifamily mortgage loans), identified
in the Uniform Single Attestation Program for Mortgage Bankers established by
the Mortgage Bankers Association of America, with respect to the servicing of
commercial and multifamily mortgage loans during the most recently completed
calendar year and (ii) on the basis of an examination conducted by such firm in
accordance with standards established by the American
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Institute of Certified Public Accountants, such representation is fairly stated
in all material respects, subject to such exceptions and other qualifications
that may be appropriate. In rendering its report such firm may rely, as to
matters relating to the direct servicing of commercial and multifamily mortgage
loans by Sub-Servicers, upon comparable reports of firms of independent
certified public accountants rendered on the basis of examinations conducted in
accordance with the same standards (rendered within one year of such report)
with respect to those Sub-Servicers.
The Special Servicer will deliver an annual accountants' report only if,
and in such form as may be, requested by the Rating Agencies.
The Master Servicer and the Special Servicer, to the extent applicable,
will use reasonable efforts to cause the accountants referred to above to
cooperate with the Depositor in conforming any reports delivered pursuant to
this Section 3.14 to requirements imposed by the Commission on the Depositor in
connection with the Commission's issuance of a no-action letter relating to the
Depositor's reporting requirements in respect of the Trust Fund pursuant to the
Exchange Act.
SECTION 3.15 Access to Certain Information.
Each of the Master Servicer and the Special Servicer shall provide or cause
to be provided to the Trustee, and to the OTS, the FDIC, and any other federal
or state banking or insurance regulatory authority that may exercise authority
over any Certificateholder, access to any documentation regarding the Mortgage
Loans and the Trust Fund within its control which may be required by this
Agreement or by applicable law. Such access shall be afforded without charge but
only upon reasonable prior written request and during normal business hours at
the offices of the Master Servicer or the Special Servicer, as the case may be,
designated by it.
SECTION 3.16 Title to REO Property; REO Account.
(a) If title to any REO Property is acquired, the deed or certificate of
sale shall be issued to the Trustee or its nominee on behalf of the
Certificateholders. The Special Servicer, on behalf of the Trust Fund, shall
attempt to sell any REO Property prior to the close of the third taxable year of
the Trust Fund following the taxable year in which the Trust Fund acquires
ownership of such REO Property for purposes of Section 860G(a)(8) of the Code,
unless the Special Servicer either (i) is granted an extension of time (an "REO
Extension") by the Internal Revenue Service to sell such REO Property or (ii)
obtains for the Trustee an Opinion of Counsel, addressed to the Trustee and the
Special Servicer, to the effect that the holding by the Trust Fund of such REO
Property subsequent to the close of such period will not (subject to Section
10.01(f)) result in the imposition of taxes on "prohibited transactions" of
REMIC I, REMIC II or REMIC III as defined in Section 860F of the Code or cause
REMIC I, REMIC II or REMIC III to fail to qualify as a REMIC (for federal (or
any applicable state or local) income tax purposes) at any time that any
Certificates are outstanding. If the Special Servicer is granted the REO
Extension contemplated by clause (i) of the immediately preceding sentence or
obtains the Opinion of Counsel contemplated by clause (ii) of the immediately
preceding sentence, the Special Servicer shall sell such REO
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Property within such longer liquidation period as is permitted by such REO
Extension or such Opinion of Counsel, as the case may be. Any expense incurred
by the Special Servicer in connection with its being granted the REO Extension
contemplated by clause (i) of the second preceding sentence or its obtaining the
Opinion of Counsel contemplated by clause (ii) of the second preceding sentence,
shall be an expense of the Trust Fund payable out of the Certificate Account
pursuant to Section 3.05(a).
(b) The Special Servicer shall cause all funds collected and received in
connection with any REO Property to be held separate and apart from its own
funds and general assets. If any REO Acquisition shall occur, the Special
Servicer shall establish and maintain (or cause to be established and
maintained) one or more accounts (collectively, the "REO Account"), to be held
on behalf of the Trustee in trust for the benefit of the Certificateholders, for
the retention of revenues and other proceeds derived from each REO Property. The
REO Account shall be an Eligible Account and may consist of one account for some
or all of the REO Properties. The Special Servicer shall deposit, or cause to be
deposited, in the REO Account, within two Business Days of receipt, all REO
Revenues, Liquidation Proceeds (net of all Liquidation Expenses paid therefrom)
and Insurance Proceeds received in respect of an REO Property. The Special
Servicer is authorized to pay out of related Liquidation Proceeds any
Liquidation Expenses incurred in respect of an REO Property and outstanding at
the time such proceeds are received. Funds in the REO Account may be invested in
Permitted Investments in accordance with Section 3.06. The Special Servicer
shall be entitled to make withdrawals from the REO Account to pay itself, as
additional servicing compensation in accordance with Section 3.11(d), interest
and investment income earned in respect of amounts held in the REO Account as
provided in Section 3.06(b) (but only to the extent of the Net Investment
Earnings with respect to the REO Account for any Collection Period). The Special
Servicer shall give notice to the Trustee and the Master Servicer of the
location of any REO Account when first established and of the new location of
such REO Account prior to any change thereof.
(c) The Special Servicer shall cause all funds necessary for the proper
operation, management, maintenance, disposition and liquidation of any REO
Property to be withdrawn from the REO Account, but only to the extent of amounts
on deposit in the REO Account relating to such REO Property. Within one Business
Day following the end of each Collection Period, the Special Servicer shall
withdraw from the REO Account and deposit into the Certificate Account or
deliver to the Master Servicer (which shall deposit such amounts into the
Certificate Account) the aggregate of all amounts received in respect of each
REO Property during such Collection Period, net of any withdrawals made out of
such amounts pursuant to Section 3.16 (b) or this Section 3.16(c); provided that
the Special Servicer may retain in the REO Account such portion of proceeds and
collections as may be necessary to maintain a reserve of sufficient funds for
the proper operation, management, maintenance and disposition of the related REO
Property (including without limitation the creation of a reasonable reserve for
repairs, replacements and necessary capital improvements and other related
expenses), such reserve not to exceed an amount sufficient to cover such items
to be incurred during the following twelve-month period.
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(d) The Special Servicer shall keep and maintain separate records, on a
property-by-property basis, for the purpose of accounting for all deposits to,
and withdrawals from, the REO Account pursuant to Section 3.16(b) or (c).
SECTION 3.17 Management of REO Property; Independent Contractors.
(a) Prior to the acquisition of title to any Mortgaged Property securing a
Defaulted Mortgage Loan, the Special Servicer shall review the operation of such
Mortgaged Property and determine the nature of the income that would be derived
from such property if it were acquired by the Trust Fund. If the Special
Servicer determines from such review, in its good faith and reasonable judgment,
that:
(i) None of the income from Directly Operating such Mortgaged Property
would be subject to tax as "net income from foreclosure property" within the
meaning of the REMIC Provisions or would be subject to the tax imposed on
"prohibited transactions" under Section 860F of the Code (either such tax
referred to herein as an "REO Tax"), such Mortgaged Property may be Directly
Operated by the Special Servicer as REO Property;
(ii) Directly Operating such Mortgaged Property as an REO Property could
result in income from such property that would be subject to an REO Tax, but
that a lease of such property to another party to operate such property, or the
performance of some services by an Independent Contractor with respect to such
property, or another method of operating such property would not result in
income subject to an REO Tax, then the Special Servicer may (provided, that in
the good faith and reasonable judgment of the Special Servicer, it is
commercially feasible) acquire such Mortgaged Property as REO Property and so
lease or operate such REO Property; or
(iii) Directly Operating such property as REO Property could result in
income subject to an REO Tax and, in the good faith and reasonable judgment of
the Special Servicer, that no commercially feasible means exists to operate such
property as REO Property without the Trust Fund incurring or possibly incurring
an REO Tax on income from such property, the Special Servicer shall deliver to
the Trustee, in writing, a proposed plan (the "Proposed Plan") to manage such
property as REO Property. Such plan shall include potential sources of income,
and to the extent commercially feasible, estimates of the amount of income from
each such source. Within a reasonable period of time after receipt of such plan,
the Trustee shall consult with the Special Servicer and shall advise the Special
Servicer of the Trust Fund's federal income tax reporting position with respect
to the various sources of income that the Trust Fund would derive under the
Proposed Plan. In addition, the Trustee shall (to the maximum extent possible)
advise the Special Servicer of the estimated amount of taxes that the Trust Fund
would be required to pay with respect to each such source of income. After
receiving the information described in the two preceding sentences from the
Trustee, the Special Servicer shall either (A) implement the Proposed Plan
(after acquiring the respective Mortgaged Property as REO Property) or (B)
manage and operate such property in a manner that would not result in the
imposition of an REO Tax on the income derived from such property.
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The Special Servicer's decision as to how each REO Property shall be
managed and operated shall in any event be based on the good faith and
reasonable judgment of the Special Servicer as to which means would (to the
extent commercially feasible) maximize the net after-tax REO Revenues received
by the Trust Fund with respect to such property without materially and adversely
affecting the Special Servicer's ability to sell such REO Property in accordance
with this Agreement and, to the extent consistent with the foregoing, in
accordance with the Servicing Standard. Both the Special Servicer and the
Trustee may consult with counsel knowledgeable in such matters at the expense of
the Trust Fund in connection with determinations required under this Section
3.17(a). Neither the Special Servicer nor the Trustee shall be liable to the
Certificateholders, the Trust Fund, the other parties hereto or each other for
errors in judgment made in good faith in the reasonable exercise of their
discretion while performing their respective responsibilities under this Section
3.17(a) or, to the extent it relates to federal income tax consequences for the
Trust Fund, Section 3.17(b) below. Nothing in this Section 3.17(a) is intended
to prevent the sale of a Defaulted Mortgage Loan or REO Property pursuant to the
terms and subject to the conditions of Section 3.18.
(b) If title to any REO Property is acquired, the Special Servicer shall
manage, conserve, protect and operate such REO Property for the benefit of the
Certificateholders solely for the purpose of its prompt disposition and sale in
a manner that does not cause such REO Property to fail to qualify as
"foreclosure property" within the meaning of Section 860G(a)(8) of the Code or,
except as permitted by Section 3.17(a), result in the receipt by the Trust Fund
of any "income from non-permitted assets" within the meaning of Section
860F(a)(2)(B) of the Code or any "net income from foreclosure property" which is
subject to taxation under the REMIC Provisions. Subject to the foregoing,
however, the Special Servicer shall have full power and authority to do any and
all things in connection therewith as are in the best interests of and for the
benefit of the Certificateholders (as determined by the Special Servicer in its
good faith and reasonable judgment) and, consistent therewith, shall withdraw
from the REO Account, to the extent of amounts on deposit therein with respect
to each REO Property, funds necessary for the proper operation, management,
maintenance and disposition of such REO Property, including, without limitation:
(i) all insurance premiums due and payable in respect of such REO Property;
(ii) all real estate taxes and assessments in respect of such REO Property
that may result in the imposition of a lien thereon;
(iii) any ground rents in respect of such REO Property; and
(iv) all costs and expenses necessary to maintain such REO Property.
To the extent that amounts on deposit in the REO Account in respect of any REO
Property are insufficient for the purposes set forth in the prior sentence with
respect to such REO Property, the Special Servicer shall advance such amount as
is necessary for such purposes (which advances shall be Servicing Advances)
unless (as evidenced by an Officer's Certificate delivered to the Trustee) such
advances would, if made, constitute Nonrecoverable Servicing Advances; provided,
however, that the Special Servicer shall make any such Servicing Advance if it
is a necessary fee or expense
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incurred in connection with the defense or prosecution of legal proceedings and
such advance will be deemed to constitute a recoverable Servicing Advance.
(c) The Special Servicer may contract with any Independent Contractor for
the operation and management of any REO Property, provided that:
(i) the terms and conditions of any such contract may not be inconsistent
herewith and shall reflect an agreement reached at arm's length;
(ii) the fees of such Independent Contractor (which shall be an expense of
the Trust Fund) shall be reasonable and customary in light of the nature and
locality of the REO Property;
(iii) any such contract shall require, or shall be administered to require,
that the Independent Contractor (A) pay, out of related REO Revenues, all costs
and expenses incurred in connection with the operation and management of such
REO Property, including, without limitation, those listed in subsection (b)
hereof, and (B) remit all related REO Revenues (net of its fees and such costs
and expenses) to the Special Servicer;
(iv) none of the provisions of this Section 3.17(c) relating to any such
contract or to actions taken through any such Independent Contractor shall be
deemed to relieve the Special Servicer of any of its duties and obligations
hereunder with respect to the operation and management of any such REO Property;
and
(v) the Special Servicer shall be obligated with respect thereto to the
same extent as if it alone were performing all duties and obligations in
connection with the operation and management of such REO Property.
The Special Servicer shall be entitled to enter into any agreement with any
Independent Contractor performing services for it related to its duties and
obligations hereunder for indemnification of the Special Servicer by such
Independent Contractor, and nothing in this Agreement shall be deemed to limit
or modify such indemnification.
SECTION 3.18 Sale of Defaulted Mortgage Loans and REO Properties.
(a) The parties hereto may sell or purchase, or permit the sale or purchase
of, a Mortgage Loan or REO Property only on the terms and subject to the
conditions set forth in this Section 3.18 or as otherwise expressly provided in
or contemplated by Sections 2.03(a) and 9.01.
(b) In the event that any Mortgage Loan becomes a Defaulted Mortgage Loan
and the Special Servicer has determined in good faith that such Defaulted
Mortgage Loan will become subject to foreclosure proceedings, the Special
Servicer shall promptly so notify, in writing, the Master Servicer and the
Trustee, and the Trustee shall so notify, in writing, within 10 days after
receipt of its notice, the Holders of the Controlling Class. The Majority
Certificateholder of the
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Controlling Class may at its (or their) option purchase from the Trust Fund, at
a price equal to the Purchase Price, any such Defaulted Mortgage Loan. The
Purchase Price for any Defaulted Mortgage Loan purchased hereunder shall be
deposited into the Certificate Account, and the Trustee, upon receipt of an
Officer's Certificate from the Master Servicer to the effect that such deposit
has been made, shall release or cause to be released to the Majority
Certificateholder of the Controlling Class (or any designee thereof) the related
Mortgage File, and shall execute and deliver such instruments of transfer or
assignment, in each case without recourse, as shall be necessary to vest in the
Majority Certificateholder of the Controlling Class (or any designee thereof)
ownership of such Defaulted Mortgage Loan. In connection with any such purchase,
the Special Servicer shall deliver the related Credit File to such
Certificateholder(s).
(c) If the Majority Certificateholder of the Controlling Class has not
purchased any Defaulted Mortgage Loan within 15 days of its having received
notice in respect thereof pursuant to the immediately preceding subsection (b),
either the Special Servicer or, subject to the Special Servicer's prior rights
in such regard, the Master Servicer may at its option, within 15 days after
receipt of such notice, purchase such Defaulted Mortgage Loan from the Trust
Fund, at a price equal to the Purchase Price. The Purchase Price for any
Defaulted Mortgage Loan purchased hereunder shall be deposited into the
Certificate Account, and the Trustee, upon receipt of an Officer's Certificate
from the Master Servicer to the effect that such deposit has been made, shall
release or cause to be released to the Master Servicer or the Special Servicer,
as applicable, the related Mortgage File, and shall execute and deliver at the
expense of the purchasing party such instruments of transfer or assignment, in
each case without recourse, representation or warranty, as shall be necessary to
vest in the Master Servicer or the Special Servicer, as applicable, such
Defaulted Mortgage Loan. In connection with any such purchase by the Master
Servicer, the Special Servicer shall deliver the related Credit File to the
Master Servicer.
(d) The Special Servicer may offer to sell any Defaulted Mortgage Loan not
otherwise purchased by the Majority Certificateholder of the Controlling Class,
the Master Servicer or the Special Servicer pursuant to subsection (b) or (c)
above, if and when the Special Servicer determines, consistent with the
Servicing Standard, that such a sale would produce a greater recovery to
Certificateholders on a present value basis than would liquidation of the
related Mortgaged Property. Such offering shall be made in a commercially
reasonable manner (which, for purposes hereof, includes an offer to sell without
representation or warranty other than customary warranties of title, loan
status, condition and similar customary matters, if liability for breach thereof
is limited to recourse against the Trust Fund) for a period of not less than 10
days or more than 90 days. Unless the Special Servicer determines that
acceptance of any offer would not be in the best economic interests of the Trust
Fund, the Special Servicer shall accept the highest cash offer received from any
Person that constitutes a fair price for such Mortgage Loan. In the absence of
any offer determined as provided below to be fair, the Special Servicer shall
proceed with respect to such Defaulted Mortgage Loan in accordance with Section
3.09 and, otherwise, in accordance with the Servicing Standard.
The Special Servicer shall use reasonable efforts to solicit offers for
each REO Property in such manner as will be reasonably likely to realize a fair
price within the time period
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provided for by Section 3.16(a). The Special Servicer shall accept the first
(and, if multiple bids are contemporaneously received, highest) cash bid
received from any Person that constitutes a fair price for such REO Property. If
the Special Servicer determines, in its good faith and reasonable judgment, that
it will be unable to realize a fair price for any REO Property within the time
constraints imposed by Section 3.16(a), then the Special Servicer shall dispose
of such REO Property upon such terms and conditions as the Special Servicer
shall deem necessary and desirable to maximize the recovery thereon under the
circumstances and, in connection therewith, shall accept the highest outstanding
cash bid, regardless of from whom received. The Liquidation Proceeds (net of
related Liquidation Expenses) for any REO Property purchased hereunder shall be
deposited in the Certificate Account, except that any portion of proceeds
consisting of Excess Liquidation Proceeds shall be deposited in the Excess
Liquidation Proceeds Reserve Account.
The Special Servicer shall give the Trustee and the Master Servicer not
less than three Business Days' prior written notice of its intention to sell any
Defaulted Mortgage Loan or REO Property. No Interested Person shall be obligated
to submit a bid to purchase any Defaulted Mortgage Loan or REO Property, and
notwithstanding anything to the contrary herein, neither the Trustee, in its
individual capacity, nor any of its Affiliates may bid for or purchase any
Defaulted Mortgage Loan or any REO Property pursuant hereto.
(e) Whether any cash bid constitutes a fair price for any Defaulted
Mortgage Loan or REO Property, as the case may be, for purposes of Section
3.18(d), shall be determined by the Special Servicer, if the highest bidder is a
Person other than an Interested Person, and by the Trustee, if the highest
bidder is an Interested Person; provided, however, that no bid from an
Interested Person shall constitute a fair price unless (i) it is the highest bid
received and (ii) at least two other bids are received from independent third
parties. In determining whether any offer received from an Interested Person
represents a fair price for any such Mortgage Loan or REO Property, the Trustee
shall be supplied with and shall rely on the most recent Appraisal or updated
Appraisal conducted in accordance with this Agreement within the preceding
12-month period or, in the absence of any such Appraisal, on a narrative
appraisal prepared by a Qualified Appraiser retained by the Special Servicer.
Such appraiser shall be selected by the Special Servicer if the Special Servicer
is not making an offer with respect to a Defaulted Mortgage Loan or REO Property
and shall be selected by the Master Servicer if the Special Servicer is making
such an offer. The cost of any such narrative appraisal shall be covered by, and
shall be reimbursable as, a Servicing Advance. In determining whether any offer
from a Person other than an Interested Person constitutes a fair price for any
such Mortgage Loan or REO Property, the Special Servicer shall take into account
(in addition to the results of any Appraisal, updated Appraisal or narrative
Appraisal that it may have obtained pursuant to this Agreement within the prior
12 months), and in determining whether any offer from an Interested Person
constitutes a fair price for any such Mortgage Loan or REO Property, any
appraiser shall be instructed to take into account, as applicable, among other
factors, the period and amount of any delinquency on the affected Defaulted
Mortgage Loan, the occupancy level and physical condition of the Mortgaged
Property or REO Property, the state of the local economy and the obligation to
dispose of any REO Property within the time period specified in Section 3.16(a).
The Purchase Price for any Defaulted Mortgage Loan or REO Property shall in all
cases be deemed a fair price.
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(f) Subject to subsections (a) through (e) above, the Special Servicer
shall act on behalf of the Trust Fund in negotiating and taking any other action
necessary or appropriate in connection with the sale of any Defaulted Mortgage
Loan or REO Property, and the collection of all amounts payable in connection
therewith. In connection therewith, the Special Servicer may charge prospective
offerors, and may retain, fees that approximate the Special Servicer's actual
costs in the preparation and delivery of information pertaining to such sales or
exchanging offers without obligation to deposit such amounts into the
Certificate Account. Any sale of a Defaulted Mortgage Loan or any REO Property
shall be final and without recourse to the Trustee or the Trust Fund (except
such recourse to the Trust Fund imposed by those representations and warranties
typically given in such transactions, any prorations applied thereto and any
customary closing matters), and if such sale is consummated in accordance with
the terms of this Agreement, none of the Special Servicer, the Master Servicer,
the Depositor or the Trustee shall have any liability to any Certificateholder
with respect to the purchase price therefor accepted by the Special Servicer or
the Trustee.
(g) Any sale of a Defaulted Mortgage Loan or any REO Property shall be for
cash only (unless, as evidenced by an Opinion of Counsel, a sale for other
consideration will not cause an Adverse REMIC Event).
(h) Notwithstanding any of the foregoing paragraphs of this Section 3.18,
the Special Servicer shall not be obligated to accept the highest cash offer if
the Special Servicer determines, in its reasonable and good faith judgment, that
rejection of such offer would be in the best interests of the
Certificateholders, and the Special Servicer may accept a lower cash offer (from
any Person other than itself or an Affiliate) if it determines, in its
reasonable and good faith judgment, that acceptance of such offer would be in
the best interests of the Certificateholders (for example, if the prospective
buyer making the lower offer is more likely to perform its obligations or the
terms offered by the prospective buyer making the lower offer are more
favorable).
SECTION 3.19 Additional Obligations of the Master Servicer and the Special
Servicer.
(a) In connection with each Adjustable Rate Mortgage Loan (and, if and to
the extent applicable, any successor REO Loan), the Master Servicer shall
calculate adjustments in the Mortgage Rate and the Monthly Payment and shall
notify the Mortgagor of such adjustments, all in accordance with the Mortgage
Note and applicable law. In the event the Index for any Adjustable Rate Mortgage
Loan (or successor REO Loan) is not published or is otherwise unavailable, the
Master Servicer shall select a comparable alternative index with respect to such
Mortgage Loan (or successor REO Loan) over which it has no direct control, which
is readily verifiable and which is acceptable under the terms of the related
Mortgage Note.
(b) The Master Servicer and the Special Servicer, as applicable, shall each
deliver to the other and to the Trustee (for inclusion in the Mortgage File)
copies of all Appraisals,
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environmental reports and engineering reports (or, in each case, updates
thereof) obtained with respect to any Mortgaged Property or REO Property.
(c) No more frequently than once per calendar month, the Special Servicer
may require the Master Servicer, and the Master Servicer shall be obligated,
subject to the second following paragraph, to reimburse the Special Servicer for
any Servicing Advances made by but not previously reimbursed to the Special
Servicer, and to pay the Special Servicer interest thereon at the Reimbursement
Rate from the date made to, but not including, the date of reimbursement. Such
reimbursement and any accompanying payment of Advance Interest shall be made
within ten (10) days of the request therefor by wire transfer of immediately
available funds to an account designated by the Special Servicer. Upon the
Master Servicer's reimbursement to the Special Servicer of any Servicing Advance
and payment to the Special Servicer of interest thereon, all in accordance with
this Section 3.19(c), the Master Servicer shall for all purposes of this
Agreement be deemed to have made such Servicing Advance at the same time as the
Special Servicer originally made such Advance, and accordingly, the Master
Servicer shall be entitled to reimbursement for such Advance, together with
interest thereon, at the same time, in the same manner and to the same extent as
the Master Servicer would otherwise have been entitled if it had actually made
such Servicing Advance.
Notwithstanding anything to the contrary contained in this Agreement, if
the Special Servicer is required under this Agreement to make any Servicing
Advance but does not desire to do so, the Special Servicer may, in its sole
discretion, request that the Master Servicer make such Advance, such request to
be made in writing and in a timely manner that does not materially and adversely
affect the interests of any Certificateholder. Subject to the following
paragraph, the Master Servicer shall have the obligation to make any such
Servicing Advance that it is requested by the Special Servicer to make within
ten days of the Master Servicer's receipt of such request. The Special Servicer
shall be relieved of any obligations with respect to an Advance that it requests
the Master Servicer to make (regardless of whether or not the Master Servicer
shall make such Advance). The Master Servicer shall be entitled to reimbursement
for any Servicing Advance made by it at the direction of the Special Servicer,
together with Advance Interest thereon, at the same time, in the same manner and
to the same extent as the Master Servicer is entitled with respect to any other
Servicing Advance made thereby. If the Special Servicer makes any Servicing
Advances in accordance with the terms of this Agreement, the Special Servicer
shall notify the Master Servicer in writing within one Business Day of any such
Servicing Advance.
Notwithstanding the foregoing provisions of this Section 3.19(c), the
Master Servicer shall not be required to make at the Special Servicer's
direction, or to reimburse the Special Servicer for, any Servicing Advance if
the Master Servicer determines in its reasonable, good faith judgment that the
Servicing Advance which the Special Servicer is directing the Master Servicer to
make or to reimburse to the Special Servicer hereunder either (y) although not
characterized by the Special Servicer as a Nonrecoverable Servicing Advance, is
or would be, if made, a Nonrecoverable Servicing Advance, or (z) the making of
such advance was or would be in violation of the Servicing Standard or the terms
and conditions of this Agreement. The Master Servicer shall notify the Special
Servicer in writing of such determination. Such notice shall not obligate the
Special Servicer to make any such proposed Servicing Advance.
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(d) Upon the earliest of (i) the date on which any Mortgage Loan becomes a
Modified Mortgage Loan, (ii) the 90th day following the occurrence of any
uncured delinquency in Monthly Payments with respect to any Mortgage Loan, (iii)
the date on which a receiver is appointed and continues in such capacity in
respect of the Mortgaged Property securing any Mortgage Loan and (iv) the date
on which the Mortgaged Property securing any Mortgage Loan becomes an REO
Property (each such Mortgage Loan and any related REO Loan, a "Required
Appraisal Loan"), the Special Servicer, shall request and, within 30 days of the
occurrence of such event (or such longer period as the Special Servicer is (as
certified thereby to the Trustee in writing) diligently and in good faith
proceeding to obtain such) obtain an Appraisal of the related Mortgaged
Property, unless an Appraisal thereof had previously been obtained within the
prior twelve months. The cost of such Appraisal shall be covered by, and
reimbursable as, a Servicing Advance.
With respect to each Required Appraisal Loan (unless such loan has become a
Corrected Mortgage Loan and has remained current for twelve consecutive Monthly
Payments, and no other Servicing Transfer Event has occurred with respect
thereto during the preceding twelve months), the Special Servicer shall, within
30 days of each anniversary of such loan's becoming a Required Appraisal Loan,
order an update of the prior Appraisal (the cost of which will be covered by,
and reimbursable as, a Servicing Advance). Based upon such Appraisal, the
Special Servicer shall determine and report to the Trustee the Appraisal
Reduction Amount, if any, with respect to such loan. The Special Servicer shall
deliver a copy of any such Appraisal to the Master Servicer.
(e) The Master Servicer shall deliver to the Trustee for deposit in the
Distribution Account on each Master Servicer Remittance Date, without any right
of reimbursement therefor, an amount equal to the aggregate of all Balloon
Payment Interest Shortfalls incurred in connection with Balloon Payments
received in respect of the Mortgage Pool during the most recently ended
Collection Period.
(f) The Master Servicer shall deliver to the Trustee for deposit in the
Distribution Account on each Master Servicer Remittance Date, without any right
of reimbursement therefor, an amount equal to the sum of (A) the lesser of (i)
the aggregate of all Prepayment Interest Shortfalls incurred in connection with
Principal Prepayments received in respect of the Mortgage Loans (other than Late
Due Date Mortgage Loans) during the most recently ended Collection Period, and
(ii) the aggregate Master Servicing Fees received by the Master Servicer during
such Collection Period and (B) the aggregate of all Extraordinary Prepayment
Interest Shortfalls, if any, incurred in connection with Principal Prepayments
received in respect of Late Due Date Mortgage Loans during the most recently
ended Collection Period.
(g) With respect to all ARD Loans, the Master Servicer shall apply all
Monthly Payments and any other sums due, in accordance with the terms of the
related ARD Loan.
(h) Subject to Section 3.20(a)(iv), with respect to all ARD Loans, the
Master Servicer and the Special Servicer shall not take any enforcement action
with respect to the payment of Excess Interest or principal in excess of the
principal component of the constant Monthly Payment, other than request for
collection, until the maturity date of the related Mortgage Loan. The
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foregoing shall not limit the Servicer and Special Servicer's obligation to
establish or direct the related Mortgagor to establish a Lock-Box Account
pursuant to Section 3.24.
(i) The Master Servicer shall be entitled to waive the application of any
provision in any ARD Loan that requires that the property manager of the related
Mortgaged Property be discharged if such Mortgage Loan is not paid in full on
its Anticipated Repayment Date.
(j) With respect to each Mortgage Loan that upon the occurrence of certain
events permits the Master Servicer to apply the proceeds of the release of any
earnout reserve to the exercise of a Defeasance Option, the Master Servicer
shall only exercise such Defeasance Option in accordance with Section 3.08 of
this Agreement.
(k) To the extent consistent with the terms of the applicable Mortgage
Loan, the Master Servicer shall exercise its option to apply any proceeds of the
release of the related earnout reserve to the prepayment or defeasance, as
applicable, of such Mortgage Loan.
(l) Upon the application of the proceeds of the release of any earnout
reserve to the prepayment of the related Mortgage Loan, the Master Servicer
shall calculate, based upon the Maturity Date, Mortgage Rate and remaining
outstanding principal balance of such Mortgage Loan, a revised schedule upon
which the remaining amount of principal and interest due upon such Mortgage Loan
shall be amortized until its Maturity Date. The Master Servicer shall deliver a
copy of such revised amortization schedule to the related Mortgagor with an
instruction to thereafter make Monthly Payments in accordance with the revised
schedule.
(m) The Master Servicer shall provide written direction to each lessor
under a Ground Lease requesting that upon any default by the lessee, notice
thereof be provided to the Master Servicer to the extent required by the Ground
Lease.
SECTION 3.20 Modifications, Waivers, Amendments and Consents.
(a) The Master Servicer and the Special Servicer each may agree to any
modification, waiver or amendment of any term of, forgive interest on and
principal of, capitalize interest on, permit the release, addition or
substitution of collateral securing, and/or permit the release of the Mortgagor
on or any guarantor of any Mortgage Loan it is required to service and
administer hereunder, without the consent of the Trustee or any
Certificateholder, subject, however, to each of the following limitations,
conditions and restrictions:
(i) other than as provided in Sections 3.02 and 3.08, the Master Servicer
(in such capacity) shall not agree to any modification, waiver or amendment of
any term of, or take any of the other acts referenced in this Section 3.20(a)
with respect to, any Mortgage Loan that would (A) affect the amount or timing of
any related payment of principal, interest or other amount payable thereunder,
(B) affect the obligation of the related Mortgagor to pay any Prepayment Premium
or permit a Principal Prepayment during any period when the terms of the
Mortgage Loan prohibit the making of Principal Prepayments or, (C) in the Master
Servicer's good faith and reasonable
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judgment, materially impair the security for such Mortgage Loan or reduce the
likelihood of timely payment of amounts due thereon; the Special Servicer (in
such capacity) may, however, agree to any modification, waiver or amendment of
any term of, or take any of the other acts referenced in this Section 3.20(a)
with respect to, a Specially Serviced Mortgage Loan that would have any such
effect, but only if, in the Special Servicer's reasonable and good faith
judgment, a material default on such Mortgage Loan has occurred or a default in
respect of payment on such Mortgage Loan is reasonably foreseeable, and such
modification, waiver, amendment or other action is reasonably likely to produce
a greater recovery to Certificateholders on a present value basis, than would
liquidation;
(ii) any such action taken by the Special Servicer shall be accompanied by
an Officer's Certificate to such effect and to which is attached the present
value calculation which establishes the basis for such determination, a copy of
which shall be delivered to the Trustee for delivery to the Rating Agencies;
(iii) neither the Master Servicer nor the Special Servicer may extend the
Stated Maturity Date of any Mortgage Loan beyond the date that is two years
prior to the Rated Final Distribution Date and, in the case of any Mortgage Loan
that is secured solely by a Ground Lease, the Master Servicer or the Special
Servicer, as the case may be, shall give due consideration to the remaining term
of such Ground Lease prior to extending the Stated Maturity Date of the Mortgage
Loan;
(iv) neither the Master Servicer nor the Special Servicer shall make or
permit any modification, waiver or amendment of any term of, or take any of the
other acts referenced in this Section 3.20(a) or clause (h) of Section 3.19 with
respect to, any Mortgage Loan that would (A) cause REMIC I, REMIC II or REMIC
III to fail to qualify as a REMIC under the Code or (subject to Section
10.01(f)) result in the imposition of any tax on "prohibited transactions" or
"contributions" after the Startup Day of any such REMIC under the REMIC
Provisions or (B) cause any Mortgage Loan to cease to be a "qualified mortgage"
within the meaning of Section 860G(a)(3) of the Code (neither the Master
Servicer nor the Special Servicer shall be liable for judgments as regards
decisions made under this subsection which were made in good faith and, unless
it would constitute bad faith or negligence to do so, each of the Master
Servicer and the Special Servicer may rely on opinions of counsel in making such
decisions);
(v) neither the Master Servicer nor the Special Servicer shall permit any
Mortgagor to add or substitute any collateral for an outstanding Mortgage Loan,
which collateral constitutes real property, unless the Master Servicer or the
Special Servicer, as the case may be, shall have first determined, in its
reasonable and good faith judgment, based upon an Environmental Assessment
performed within the twelve months prior to such determination (and such
additional environmental testing as the Master Servicer or Special Servicer, as
the case may be, deems necessary and appropriate) prepared by an Independent
Person who regularly conducts Environmental Assessments (and such additional
environmental testing), at the expense of the Mortgagor, that such additional or
substitute collateral is in compliance with applicable environmental laws and
regulations and that there are no circumstances or conditions present with
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respect to such new collateral relating to the use, management or disposal of
any Hazardous Materials for which investigation, testing, monitoring,
containment, clean-up or remediation would be required under any then applicable
environmental laws and/or regulations; and
(vi) neither the Master Servicer nor the Special Servicer shall release or
substitute any collateral securing an outstanding Mortgage Loan except as
provided in Sections 3.08 and 3.09(d) and except in the case of a release where
(A) the use of the collateral to be released will not, in the Master Servicer's
or Special Servicer's, as the case may be, good faith and reasonable judgment,
materially and adversely affect the Net Operating Income being generated by or
the use of the related Mortgaged Property, (B) there is a corresponding
principal paydown of such Mortgage Loan in an amount at least equal to, or a
delivery of substitute collateral with an appraised value at least equal to, the
appraised value of the collateral to be released, (C) the remaining Mortgaged
Property and any substitute collateral is, in the Master Servicer's or Special
Servicer's, as the case may be, good faith and reasonable judgment, adequate
security for the remaining Mortgage Loan and (D) such release and/or
substitution would not, in and of itself, result in the downgrade, qualification
(including by placement on "negative credit watch") or withdrawal of the rating
then assigned by any Rating Agency to any Class of Certificates (as confirmed in
writing by each Rating Agency); provided that (x) the limitations, conditions
and restrictions set forth in clauses (i) through (vi) above shall not apply to
any modification of any term of any Mortgage Loan or any other acts referenced
in this Section 3.20(a) that is required under the terms of such Mortgage Loan
in effect on the Closing Date and that is solely within the control of the
related Mortgagor, and (y) notwithstanding clauses (i) through (vi) above,
neither the Master Servicer nor the Special Servicer shall be required to oppose
the confirmation of a plan in any bankruptcy or similar proceeding involving a
Mortgagor if in their reasonable and good faith judgment such opposition would
not ultimately prevent the confirmation of such plan or one substantially
similar. Neither the Master Servicer nor the Special Servicer may extend the
Maturity Date on any Mortgage Loan except pursuant to this Section 3.20(a) or as
otherwise required under the related loan documents.
(b) Neither the Master Servicer nor the Special Servicer shall have any
liability to the Trust Fund, the Certificateholders or any other Person if its
analysis and determination that the modification, waiver, amendment or other
action contemplated by Section 3.20(a) is reasonably likely to produce a greater
recovery to Certificateholders on a present value basis than would liquidation,
should prove to be wrong or incorrect, so long as the analysis and determination
were made on a reasonable basis in good faith by the Master Servicer or Special
Servicer and the Master Servicer or Special Servicer was not negligent in
ascertaining the pertinent facts.
(c) Any payment of interest, which is deferred pursuant to any
modification, waiver or amendment permitted hereunder, shall not, for purposes
hereof, including, without limitation, calculating monthly distributions to
Certificateholders, be added to the unpaid principal balance of the related
Mortgage Loan, notwithstanding that the terms of such Mortgage Loan or such
modification, waiver or amendment so permit.
(d) The Master Servicer and, with respect to a Specially Serviced Mortgaged
Loan, the Special Servicer each may, as a condition to its granting any request
by a Mortgagor for
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consent, modification, waiver or indulgence or any other matter or thing, the
granting of which is within the Master Servicer's or the Special Servicer's
discretion pursuant to the terms of the instruments evidencing or securing the
related Mortgage Loan and is permitted by the terms of this Agreement, require
that such Mortgagor pay to it, as additional servicing compensation, a
reasonable or customary fee (not to exceed 1.0% of the unpaid principal balance
of the related Mortgage Loan) for the additional services performed in
connection with such request, together with any related costs and expenses
incurred by it.
(e) Except for waivers of Penalty Charges and notice periods, all material
modifications, waivers and amendments of the Mortgage Loans entered into
pursuant to this Section 3.20 shall be in writing.
(f) Each of the Master Servicer and the Special Servicer shall notify the
Trustee and such other party, in writing, of any modification, waiver (other
than a waiver of Penalty Charges) or amendment of any term of any Mortgage Loan
and the date thereof, and shall deliver to the Trustee or the related Custodian
for deposit in the related Mortgage File, an original counterpart of the
agreement relating to such modification, waiver or amendment, promptly (and in
any event within 10 Business Days) following the execution thereof.
SECTION 3.21 Transfer of Servicing Between Master Servicer and Special
Servicer; Record Keeping.
(a) Upon determining that a Servicing Transfer Event has occurred with
respect to any Mortgage Loan and if the Master Servicer is not also the Special
Servicer, the Master Servicer shall promptly give notice thereof, and deliver
the related Servicing File, to the Special Servicer and shall use reasonable
efforts to provide the Special Servicer with all information, documents (or
copies thereof) and records (including records stored electronically on computer
tapes, magnetic discs and the like) relating to the Mortgage Loan and reasonably
requested by the Special Servicer to enable it to assume its functions hereunder
with respect thereto without acting through a Sub-Servicer. The Master Servicer
shall use reasonable efforts to comply with the preceding sentence within five
Business Days of the occurrence of each related Servicing Transfer Event. The
Special Servicer may, as to any delinquent Mortgage Loan, prior to the
occurrence of a Servicing Transfer Event with respect thereto, request and
obtain the foregoing documents and information.
Upon determining that a Specially Serviced Mortgage Loan has become a
Corrected Mortgage Loan and if the Master Servicer is not also the Special
Servicer, the Special Servicer shall promptly give notice thereof, and return
the related Servicing File, to the Master Servicer and upon giving such notice,
and returning such Servicing File, to the Master Servicer, the Special
Servicer's obligation to service such Mortgage Loan, and the Special Servicer's
right to receive the Special Servicing Fee with respect to such Mortgage Loan,
shall terminate, and the obligations of the Master Servicer to service and
administer such Mortgage Loan in accordance with this Agreement shall resume.
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Notwithstanding other provisions in this Agreement to the contrary, the
Master Servicer shall remain responsible for the billing and collection,
accounting, data collection, reporting and other basic Master Servicer
administrative functions with respect to Specially Serviced Mortgage Loans,
provided that the Special Servicer shall establish procedures for the Master
Servicer as to the application of receipts and tendered payments and shall have
the exclusive responsibility for and authority over all contacts with and
notices to Mortgagors and similar matters relating to each Specially Serviced
Mortgage Loan and the related Mortgaged Property.
(b) In servicing any Specially Serviced Mortgage Loans, the Special
Servicer shall provide to the Trustee originals of documents included within the
definition of "Mortgage File" for inclusion in the related Mortgage File (with a
copy of each such original to the Master Servicer), and copies of any additional
related Mortgage Loan information, including correspondence with the related
Mortgagor.
(c) Notwithstanding anything in this Agreement to the contrary, in the
event that the Master Servicer and the Special Servicer are the same Person, all
notices, certificates, information and consents required to be given by the
Master Servicer to the Special Servicer or vice versa shall be deemed to be
given without the necessity of any action on such Person's part.
SECTION 3.22 Sub-Servicing Agreements.
(a) The Master Servicer and the Special Servicer may each enter into
Sub-Servicing Agreements for the servicing and administration of all or a part
of the Mortgage Loans for which it is responsible hereunder, provided that, in
each case, the Sub-Servicing Agreement: (i) is not inconsistent with this
Agreement and shall provide that the Sub-Servicer will maintain errors and
omissions insurance and fidelity bond coverage as required of the Master
Servicer or the Special Servicer (whichever retained it) under Section 3.07
hereof; (ii) provides that if the Master Servicer or the Special Servicer, as
the case may be, shall for any reason no longer be the Master Servicer or
Special Servicer, as applicable, hereunder (including, without limitation, by
reason of an Event of Default or their termination hereunder), the Trustee, its
designee or any successor Master Servicer or Special Servicer may thereupon
assume all of the rights and, except to the extent they arose prior to the date
of assumption, obligations of the Master Servicer or the Special Servicer, as
the case may be, under such agreement; (iii) in the case of a Sub-Servicing
Agreement entered into by the Master Servicer, expressly or effectively provides
that (if the Master Servicer and the Special Servicer are not the same Person)
such agreement shall terminate with respect to any Mortgage Loan serviced
thereunder at the time such Mortgage Loan becomes a Specially Serviced Mortgage
Loan; (iv) requires that the Master Servicer consent to any modification to the
terms of a Mortgage Loan pursuant to Section 3.20; and (v) in the case of a
Sub-Servicing Agreement entered into by the Special Servicer, relates only to
Specially Serviced Mortgage Loans or REO Properties and expressly or effectively
provides that (if the Master Servicer and the Special Servicer are not the same
Person) such agreement shall terminate with respect to any such Mortgage Loan
that becomes a Corrected Mortgage Loan. Termination penalties or fees incurred
under any such Sub-Servicing Agreement shall not be an obligation of, or expense
chargeable to, the Certificateholders or the Trust Fund. References in this
Agreement to actions taken or to be taken by the Master Servicer or the Special
Servicer, as the case may be, include actions taken or to be taken by a
Sub-Servicer on behalf of the Master Servicer or the
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Special Servicer, as the case may be; and, in connection therewith, all amounts
advanced by any Sub-Servicer to satisfy the obligations of the Master Servicer
or the Special Servicer, as the case may be, hereunder to make Servicing
Advances and Delinquency Advances shall be deemed to have been advanced by the
Master Servicer or the Special Servicer, as the case may be, out of its own
funds and, accordingly, such Advances shall be recoverable by such Sub-Servicer
in the same manner and out of the same funds as if such Sub-Servicer were the
Master Servicer or the Special Servicer, as the case may be, and, for so long as
they are outstanding, such Advances shall accrue interest in accordance with
Section 3.11(f) or Section 4.03(d), as applicable, such interest to be allocable
between the Master Servicer or the Special Servicer, as the case may be, and
such Sub-Servicer as they may agree. For purposes of this Agreement, the Master
Servicer and the Special Servicer each shall be deemed to have received any
payment when the Sub-Servicer receives such payment.
(b) Each Sub-Servicer shall be authorized to transact business in the state
or states in which the related Mortgaged Properties it is to service are
situated, if and to the extent required by applicable law.
(c) As part of its servicing activities hereunder, the Master Servicer and
the Special Servicer, for the benefit of the Trustee and the Certificateholders,
shall (at no expense to the Trustee, the Certificateholders or the Trust Fund)
monitor the performance and enforce the obligations of each Sub-Servicer
retained by it under the related Sub-Servicing Agreement. Such enforcement,
including, without limitation, the legal prosecution of claims, termination of
Sub-Servicing Agreements in accordance with their respective terms and the
pursuit of other appropriate remedies, shall be in such form and carried out to
such an extent and at such time by the Master Servicer and the Special Servicer
in accordance with the Servicing Standard.
(d) In the event the Trustee, its designee or any successor Master Servicer
or Special Servicer assumes the rights and obligations of the Master Servicer or
the Special Servicer under any Sub-Servicing Agreement, the Master Servicer or
the Special Servicer, as the case may be, at its expense shall, upon request of
the Trustee, deliver to the assuming party all documents and records relating to
such Sub-Servicing Agreement and the Mortgage Loans then being serviced
thereunder and an accounting of amounts collected and held on behalf of it
thereunder, and otherwise use reasonable efforts to effect the orderly and
efficient transfer of the Sub-Servicing Agreement to the assuming party.
(e) Notwithstanding any Sub-Servicing Agreement, the Master Servicer and
the Special Servicer each shall remain obligated and liable to the Trustee and
the Certificateholders for the servicing and administration of the Mortgage
Loans in accordance with the provisions of this Agreement to the same extent and
under the same terms and conditions as if it alone were servicing and
administering the Mortgage Loans for which it is responsible.
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SECTION 3.23 Designation of Special Servicer by the Majority
Certificateholder of the Controlling Class.
(a) The Majority Certificateholder of the Controlling Class, may at any
time and from time to time replace any existing Special Servicer or any Special
Servicer that has resigned or otherwise ceased to serve as Special Servicer,
including pursuant to Section 7.01. Such Holders shall so designate a Person to
so serve by the delivery to the Trustee of a written notice stating such
designation, subject to the confirmation of the Rating Agencies. The Trustee
shall, promptly after receiving any such notice, so notify the Rating Agencies.
The designated Person shall become the Special Servicer as of the date the
Trustee shall have received: (i) written confirmation from the Rating Agencies
stating that if the designated Person were to serve as Special Servicer
hereunder, none of the then-current ratings of the outstanding Classes of the
Certificates would be qualified (including by placement on "negative credit
watch"), downgraded or withdrawn; (ii) a written acceptance of all obligations
of the Special Servicer under this Agreement, executed by the designated Person;
and (iii) an Opinion of Counsel (at the expense of the Person designated to
become the Special Servicer or the Holders that made the designation) to the
effect that the designation of such Person to serve as Special Servicer is in
compliance with this Section 3.23 and all other applicable provisions of this
Agreement, that upon the execution and delivery of the written acceptance
referred to in the immediately preceding clause (ii), the designated Person
shall be bound by the terms of this Agreement and that this Agreement shall be
enforceable against the designated Person in accordance with its terms. The
existing Special Servicer shall be deemed to have resigned simultaneously with
such designated Person's becoming the Special Servicer hereunder; provided,
however, that (i) the resigning Special Servicer shall continue to be entitled
to receive all amounts accrued or owing to it under this Agreement on or prior
to the effective date of such resignation, whether in respect of Servicing
Advances or otherwise, and (ii) it and its directors, officers, employees and
agents shall continue to be entitled to the benefits of Section 6.03,
notwithstanding any such resignation. Such resigning Special Servicer shall
cooperate with the Trustee and the replacement Special Servicer in effecting the
termination of the resigning Special Servicer's responsibilities and rights
hereunder, including, without limitation, the transfer within two Business Days
to the replacement Special Servicer for administration by it of all cash amounts
that shall at the time be or should have been deposited in the REO Account or
delivered by the Special Servicer to the Master Servicer or that are thereafter
received with respect to Specially Serviced Mortgage Loans and REO Properties.
(b) The Majority Certificateholder of the Controlling Class will have no
liability to the Trust or the Certificateholders for any action taken, or for
refraining from the taking of any action, in good faith pursuant to this
Agreement, or for errors in judgment. Each Holder and Certificate Owner
acknowledges and agrees, by its acceptance of its Certificates or an interest
therein, that the Majority Certificateholder of the Controlling Class may have
special relationships and interests that conflict with those of Holders and
Certificate Owners of one or more Classes of Certificates, that the Majority
Certificateholder of the Controlling Class may act solely in the interests of
the Holders and Certificate Owners of the Controlling Class, that the Majority
Certificateholder of the Controlling Class does not have any duties to the
Holders and Certificate Owners of any Class of Certificates other than the
Controlling Class, that the Majority Certificateholder of the Controlling Class
may take actions that favor interests of the Holders and Certificate Owners of
the Controlling Class over the interests of the Holders and Certificate Owners
of one or more other Classes of Certificates, and that the Majority
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Certificateholder of the Controlling Class shall have no liability whatsoever
for having so acted, and no Certificateholder may take any action whatsoever
against the Majority Certificateholder of the Controlling Class or any director,
officer, employee, agent or principal thereof for having so acted.
SECTION 3.24 Lock-Box Accounts and Servicing Accounts.
(a) The Master Servicer shall administer each Lock-Box Account, Cash
Collateral Account and Servicing Account in accordance with the related Mortgage
Loan, Cash Collateral Account Agreement or Lock-Box Agreement, if any.
(b) For any Mortgage Loan that provides that a Lock-Box Account or Cash
Collateral Account will be established upon the occurrence of certain events
specified in such Mortgage Loan, the Master Servicer (or, with respect to any
Specially Serviced Loan, the Special Servicer) shall use reasonable efforts to
establish or cause to be established such Lock-Box Account upon the occurrence
of such events unless the Master Servicer (or the Special Servicer, as
applicable) determines, in accordance with the Servicing Standards, that such
Lock-Box Account should not be established. Notwithstanding the foregoing, the
Master Servicer (or the Special Servicer, as applicable) shall use reasonable
efforts to establish or cause to be established a Lock-Box Account for each ARD
Loan no later than its Anticipated Repayment Date.
SECTION 3.25 Representations and Warranties of the Master Servicer and the
Special Servicer.
GMACCM, in its capacity as both Master Servicer and Special Servicer
hereunder hereby represents and warrants to the Trustee, for its own benefit and
the benefit of the Certificateholders, and to the Depositor, as of the Closing
Date, that:
(i) GMACCM is a corporation, duly organized, validly existing and in good
standing under the laws of the State of California, and GMACCM is in compliance
with the laws of each State in which any Mortgaged Property is located to the
extent necessary to perform its obligations under this Agreement.
(ii) The execution and delivery of this Agreement by GMACCM, and the
performance and compliance with the terms of this Agreement by GMACCM, will not
violate GMACCM's organizational documents or constitute a default (or an event
which, with notice or lapse of time, or both, would constitute a default) under,
or result in the breach of, any material agreement or other instrument to which
it is a party or which is applicable to it or any of its assets.
(iii) GMACCM has the full power and authority to enter into and consummate
all transactions contemplated by this Agreement, has duly authorized the
execution, delivery and performance of this Agreement, and has duly executed and
delivered this Agreement.
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(iv) This Agreement, assuming due authorization, execution and delivery by
the other parties hereto, constitutes a valid, legal and binding obligation of
GMACCM, enforceable against GMACCM in accordance with the terms hereof, subject
to (A) applicable bankruptcy, insolvency, reorganization, moratorium and other
laws affecting the enforcement of creditors' rights generally, and (B) general
principles of equity, regardless of whether such enforcement is considered in a
proceeding in equity or at law.
(v) GMACCM is not in violation of, and its execution and delivery of this
Agreement and its performance and compliance with the terms of this Agreement
will not constitute a violation of, any law, order or decree of any court or
arbiter, or any order, regulation or demand of any federal, state or local
governmental or regulatory authority, which violation, in GMACCM's good faith
and reasonable judgment, is likely to affect materially and adversely either the
ability of GMACCM to perform its obligations under this Agreement or the
financial condition of GMACCM.
(vi) No litigation is pending or, to the best of GMACCM's knowledge,
threatened against GMACCM the outcome of which, in GMACCM's good faith and
reasonable judgment, could reasonably be expected to prohibit GMACCM from
entering into this Agreement or materially and adversely affect the ability of
GMACCM to perform its obligations under this Agreement.
(vii) GMACCM has errors and omissions insurance coverage which is in full
force and effect and complies with the requirements of Section 3.07 hereof.
(viii) No consent, approval, authorization or order, registration or filing
with or notice to, any governmental authority or court is required, under
federal or state law, for the execution, delivery and performance of or
compliance by GMACCM with this Agreement, or the consummation by GMACCM of any
transaction contemplated hereby, other than (1) such consents, approvals,
authorizations, qualifications, registrations, filings, or notices as have been
obtained or made and (2) where the lack of such consent, approval,
authorization, qualification, registration, filing or notice would not have a
material adverse effect on the performance by GMACCM under this Agreement.
ARTICLE IV
PAYMENTS TO CERTIFICATEHOLDERS
AND RELATED MATTERS
SECTION 4.01 Distributions.
(a) On each Distribution Date, the Trustee shall be deemed to apply the
Available Distribution Amount for such date for the following purposes and in
the following order of priority:
(i) to pay interest to REMIC II in respect of the various REMIC I Regular
Interests, up to an amount equal to, and pro rata in accordance with, all
Uncertificated Distributable
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Interest for each such REMIC I Regular Interest for such Distribution Date and,
to the extent not previously deemed paid, for all prior Distribution Dates;
(ii) to pay principal to REMIC II in respect of the various REMIC I Regular
Interests, up to an amount equal to, and pro rata in accordance with, in the
case of each such REMIC I Regular Interest for such Distribution Date, the
excess, if any, of the Uncertificated Principal Balance of such REMIC I Regular
Interest outstanding immediately prior to such Distribution Date, over the
Stated Principal Balance of the related Mortgage Loan, REO Loan or, if
applicable, Replacement Mortgage Loan(s), as the case may be, that will be
outstanding immediately following such Distribution Date; and
(iii) to reimburse REMIC II for any Realized Losses and Additional Trust
Fund Expenses previously deemed allocated to the various REMIC I Regular
Interests, up to an amount equal to, and pro rata in accordance with, the Loss
Reimbursement Amount for each such REMIC I Regular Interest immediately prior to
such Distribution Date.
On each Distribution Date, the Trustee shall be deemed to apply any amounts
withdrawn from the Excess Liquidation Proceeds Reserve Account for such
Distribution Date to reimburse REMIC II for any Realized Losses and Additional
Trust Fund Expenses previously deemed allocated to the various REMIC I Regular
Interests and unreimbursed pursuant to Section 4.01(a)(iii), up to an amount
equal to, and pro rata in accordance with, the Loss Reimbursement Amount for
each such REMIC I Regular Interest immediately prior to such Distribution Date.
On each Distribution Date, the Trustee shall pay to the Holders of the
Class R-I Certificates, in accordance with Section 4.01(c), that portion, if
any, of the Available Distribution Amount for such date that has not otherwise
been deemed paid to REMIC II in respect of the REMIC I Regular Interests
pursuant to the foregoing provisions of this Section 4.01(a) (such portion, the
"Class R-I Distribution Amount" for such Distribution Date).
On each Distribution Date, the Trustee shall be deemed to apply amounts
relating to each Prepayment Premium then on deposit in the Distribution Account
and received during or prior to the related Collection Period, to pay additional
interest to REMIC II in respect of the REMIC I Regular Interest that relates to
the Mortgage Loan or REO Loan, as the case may be, as to which such Prepayment
Premium was received.
All amounts (other than additional interest in the form of amounts relating
to Prepayment Premiums) deemed paid to REMIC II in respect of the REMIC I
Regular Interests pursuant to this Section 4.01(a) on any Distribution Date is
hereinafter referred to as the "REMIC II Distribution Amount" for such date.
(b) On each Distribution Date, the Trustee shall be deemed to apply the
REMIC II Distribution Amount (other than any amounts withdrawn from the Excess
Liquidation Proceeds Reserve Account) for such date for the following purposes
and in the following order of priority:
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(i) to pay interest to REMIC III in respect of all REMIC II Regular
Interests up to an amount equal to all Uncertificated Distributable Interest in
respect of such REMIC II Regular Interests for such Distribution Date and, to
the extent not previously deemed paid, for all prior Distribution Dates with
such payments allocated among the REMIC II Regular Interests such that remaining
amounts, if any, of unpaid interest on each such REMIC II Regular Interest will
equate to the remaining unpaid accrued interest on the corresponding Class of
Principal Balance Certificates or Class X Component outstanding after all
subsequent adjustments made on such Distribution Date under Section 4.01(c)
below;
(ii) to pay principal to REMIC III in respect of all REMIC II Regular
Interests apportioned as payment of Uncertificated Principal Balance among REMIC
II Regular Interests such that the remaining Uncertificated Principal Balance of
each such class will equal the then outstanding Class Principal Balance of the
corresponding Principal Balance Certificate after all subsequent adjustments
made on such Distribution Date under Section 4.01(c) below (other than payments
thereunder in reimbursement of any Realized Losses and Additional Trust Fund
Expenses); and
(iii) to reimburse REMIC III for any Realized Losses and Additional Trust
Fund Expenses previously deemed allocated to REMIC II Regular Interests,
apportioned among the REMIC II Regular Interests consistent with the
reimbursement payments made on the corresponding Classes of Principal Balance
Certificates on such Distribution Date under Section 4.01(c) below.
On each Distribution Date, the Trustee shall be deemed to apply any amounts
withdrawn from the Excess Liquidation Proceeds Reserve Account for such
Distribution Date to reimburse REMIC III for any Realized Losses and Additional
Trust Fund Expenses previously deemed allocated to REMIC II Regular Interests
and unreimbursed pursuant to Section 4.01(b)(iii), consistent with the
reimbursement payments made on the corresponding Classes of Principal Balance
Certificates on such Distribution Date under Section 4.01(c) below
On each Distribution Date, the Trustee shall pay to the Holders of the
Class R-II Certificates, in accordance with Section 4.01(c), that portion, if
any, of the REMIC II Distribution Amount for such date that has not otherwise
been deemed paid to REMIC III in respect of the REMIC II Regular Interests
pursuant to the foregoing provisions of this Section 4.01(b) (such portion, the
"Class R-II Distribution Amount" for such Distribution Date).
On each Distribution Date, the Trustee shall be deemed to apply all amounts
relating to Prepayment Premiums then on deposit in the Distribution Account and
received during or prior to the related Collection Period, to pay additional
interest to REMIC III in respect of REMIC II Regular Interests allocable among
the REMIC II Regular Interests in an amount with respect to each REMIC II
Regular Interest equal to the amount allocable to the corresponding Class of
Principal Balance Certificates and Class X Component outstanding after all
subsequent adjustments made on such Distribution Date under Section 4.01(c)
below.
(c) On each Distribution Date, following the deemed payments to REMIC III
in respect of the REMIC II Regular Interests on such date pursuant to Section
4.01(b), the Trustee shall
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withdraw from the Distribution Account the Available Distribution Amount for
such Distribution Date and shall apply such amount for the following purposes
and in the following order of priority:
(i) to pay interest to the Holders of the respective Classes of Senior
Certificates, in an amount equal to, and pro rata in accordance with, all
Distributable Certificate Interest in respect of each such Class of Certificates
for such Distribution Date and, to the extent not previously paid, for all prior
Distribution Dates;
(ii) to pay principal first to the Holders of the Class A-1 Certificates
and second to the Holders of the Class A-2 Certificates, in each case, up to an
amount equal to the lesser of (1) the then outstanding Class Principal Balance
of such Class of Certificates and (2) the remaining portion, if any, of such
Principal Distribution Amount;
(iii) to reimburse the Holders of the respective Classes of Class A
Certificates, up to an amount equal to and pro rata as among such Classes in
accordance with, the respective amounts of Realized Losses and Additional Trust
Fund Expenses, if any, previously deemed allocated to such Classes of
Certificates and for which no reimbursement has previously been paid; and
(iv) to make payments on the Subordinated Certificates pursuant to the
following paragraph;
provided that, on each Distribution Date after the aggregate of the Class
Principal Balances of the Subordinated Certificates has been reduced to zero,
and in any event on the Final Distribution Date, the payments of principal to be
made pursuant to clause (ii) above, will be so made to the Holders of the
respective Classes of Class A Certificates, up to an amount equal to, and pro
rata as among such Classes in accordance with, the respective then outstanding
Class Principal Balances of such Classes of Certificates. References to
"remaining Principal Distribution Amount" shall be to the Principal Distribution
Amount net of any distributions of principal made in respect thereof to the
Holders of each Class of Class A Certificates that, pursuant to clause (ii)
above, have a prior right to payment with respect thereto.
On each Distribution Date, following the foregoing series of payments on
the Senior Certificates, the Trustee shall apply the remaining portion, if any,
of the Available Distribution Amount for such date for the following purposes
and in the following order of priority:
(i) to pay interest to the Holders of the Class B Certificates, up to an
amount equal to all Distributable Certificate Interest in respect of such Class
of Certificates for such Distribution Date and, to the extent not previously
paid, for all prior Distribution Dates;
(ii) if the Class Principal Balances of the Class A Certificates have been
reduced to zero, to pay principal to the Holders of the Class B Certificates, up
to an amount equal to the lesser of (A) the then outstanding Class Principal
Balance of such Class of Certificates and (B) the remaining Principal
Distribution Amount for such Distribution Date;
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(iii) to reimburse the Holders of the Class B Certificates, up to an amount
equal to all Realized Losses and Additional Trust Fund Expenses, if any,
previously deemed allocated to such Class of Certificates and for which no
reimbursement has previously been paid;
(iv) to pay interest to the Holders of the Class C Certificates, up to an
amount equal to all Distributable Certificate Interest in respect of such Class
of Certificates for such Distribution Date and, to the extent not previously
paid, for all prior Distribution Dates;
(v) if the Class Principal Balances of the Class A and Class B Certificates
have been reduced to zero, to pay principal to the Holders of the Class C
Certificates, up to an amount equal to the lesser of (A) the then outstanding
Class Principal Balance of such Class of Certificates and (B) the remaining
Principal Distribution Amount for such Distribution Date;
(vi) to reimburse the Holders of the Class C Certificates, up to an amount
equal to all Realized Losses and Additional Trust Fund Expenses, if any,
previously deemed allocated to such Class of Certificates and for which no
reimbursement has previously been received;
(vii) to pay interest to the Holders of the Class D Certificates, up to an
amount equal to all Distributable Certificate Interest in respect of such Class
of Certificates for such Distribution Date and, to the extent not previously
paid, for all prior Distribution Dates;
(viii) if the Class Principal Balances of the Class A, Class B and Class C
Certificates have been reduced to zero, to pay principal to the Holders of the
Class D Certificates, up to an amount equal to the lesser of (A) the then
outstanding Class Principal Balance of such Class of Certificates and (B) the
remaining Principal Distribution Amount for such Distribution Date;
(ix) to reimburse the Holders of the Class D Certificates, up to an amount
equal to all Realized Losses and Additional Trust Fund Expenses, if any,
previously deemed allocated to such Class of Certificates and for which no
reimbursement has previously been received;
(x) to pay interest to the Holders of the Class E Certificates, up to an
amount equal to all Distributable Certificate Interest in respect of such Class
of Certificates for such Distribution Date and, to the extent not previously
paid, for all prior Distribution Dates;
(xi) if the Class Principal Balances of the Class A, Class B, Class C and
Class D Certificates have been reduced to zero, to pay principal to the Holders
of the Class E Certificates, up to an amount equal to the lesser of (A) the then
outstanding Class Principal Balance of such Class of Certificates and (B) the
remaining Principal Distribution Amount for such Distribution Date;
(xii) to reimburse the Holders of the Class E Certificates, up to an amount
equal to all Realized Losses and Additional Trust Fund Expenses, if any,
previously deemed allocated to such Class of Certificates and for which no
reimbursement has previously been received;
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(xiii) to pay interest to the Holders of the Class F Certificates, up to an
amount equal to all Distributable Certificate Interest in respect of such Class
of Certificates for such Distribution Date and, to the extent not previously
paid, for all prior Distribution Dates;
(xiv) if the Class Principal Balances of the Class A, Class B, Class C,
Class D and Class E Certificates have been reduced to zero, to pay principal to
the Holders of the Class F Certificates, up to an amount equal to the lesser of
(A) the then outstanding Class Principal Balance of such Class of Certificates
and (B) the remaining Principal Distribution Amount for such Distribution Date;
(xv) to reimburse the Holders of the Class F Certificates, up to an amount
equal to all Realized Losses and Additional Trust Fund Expenses, if any,
previously deemed allocated to such Class of Certificates and for which no
reimbursement has previously been received;
(xvi) to pay interest to the Holders of the Class G Certificates, up to an
amount equal to all Distributable Certificate Interest in respect of such Class
of Certificates for such Distribution Date and, to the extent not previously
paid, for all prior Distribution Dates;
(xvii) if the Class Principal Balances of the Class A, Class B, Class C,
Class D, Class E and Class F Certificates have been reduced to zero, to pay
principal to the Holders of the Class G Certificates, up to an amount equal to
the lesser of (A) the then outstanding Class Principal Balance of such Class of
Certificates and (B) the remaining Principal Distribution Amount for such
Distribution Date;
(xviii) to reimburse the Holders of the Class G Certificates, up to an
amount equal to all Realized Losses and Additional Trust Fund Expenses, if any,
previously deemed allocated to such Class of Certificates and for which no
reimbursement has previously been received;
(xix) to pay interest to the Holders of the Class H Certificates, up to an
amount equal to all Distributable Certificate Interest in respect of such Class
of Certificates for such Distribution Date and, to the extent not previously
paid, for all prior Distribution Dates;
(xx) if the Class Principal Balances of the Class A, Class B, Class C,
Class D, Class E, Class F and Class G Certificates have been reduced to zero, to
pay principal to the Holders of the Class H Certificates, up to an amount equal
to the lesser of (A) the then outstanding Class Principal Balance of such Class
of Certificates and (B) the remaining Principal Distribution Amount for such
Distribution Date;
(xxi) to reimburse the Holders of the Class H Certificates, up to an amount
equal to all Realized Losses and Additional Trust Fund Expenses, if any,
previously deemed allocated to such Class of Certificates and for which no
reimbursement has previously been received;
(xxii) to pay interest to the Holders of the Class J Certificates, up to an
amount equal to all Distributable Certificate Interest in respect of such Class
of Certificates for such Distribution Date and, to the extent not previously
paid, for all prior Distribution Dates;
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(xxiii) if the Class Principal Balances of the Class A, Class B, Class C,
Class D, Class E, Class F, Class G and Class H Certificates have been reduced to
zero, to pay principal to the Holders of the Class J Certificates, up to an
amount equal to the lesser of (A) the then outstanding Class Principal Balance
of such Class of Certificates and (B) the remaining Principal Distribution
Amount for such Distribution Date;
(xxiv) to reimburse the Holders of the Class J Certificates, up to an
amount equal to all Realized Losses and Additional Trust Fund Expenses, if any,
previously deemed allocated to such Class of Certificates and for which no
reimbursement has previously been received;
(xxv) to pay interest to the Holders of the Class K Certificates, up to an
amount equal to all Distributable Certificate Interest in respect of the Class K
Certificates for such Distribution Date and, to the extent not previously paid,
for all prior Distribution Dates;
(xxvi) if the Class Principal Balances of the Class A, Class B, Class C,
Class D, Class E, Class F, Class G, Class H and Class J Certificates have been
reduced to zero, to pay principal to the Holders of the Class K Certificates, up
to an amount equal to the lesser of (A) the then outstanding Class Principal
Balance of such Class K Certificates and (B) the remaining Principal
Distribution Amount for such Distribution Dates;
(xxvii) to reimburse the Holders of the Class K Certificates, up to an
amount equal to all Realized Losses and Additional Trust Fund Expenses, if any,
previously deemed allocated to such Class K Certificates and for which no
reimbursement has previously been received;
(xxviii) to pay interest to the Holders of the Class L Certificates, up to
an amount equal to all Distributable Certificate Interest in respect of such
Class L Certificates for such Distribution Date and, to the extent not
previously paid, for all prior Distribution Dates;
(xxix) if the Class Principal Balances of the Class A, Class B, Class C,
Class D, Class E, Class F, Class G, Class H, Class J and Class K Certificates
have been reduced to zero, to pay principal to the Holders of the Class L
Certificates, up to an amount equal to the lesser of (A) the then outstanding
Class Principal Balance of such Class L Certificates and (B) the remaining
Principal Distribution Amount for such Distribution Dates;
(xxx) to reimburse the Holders of the Class L Certificates, up to an amount
equal to all Realized Losses and Additional Trust Fund Expenses, if any,
previously deemed allocated to such Class L Certificates and for which no
reimbursement has previously been received;
(xxxi) to pay interest to the Holders of the Class M Certificates, up to an
amount equal to all Distributable Certificate Interest in respect of such Class
M Certificates for such Distribution Date and, to the extent not previously
paid, for all prior Distribution Dates;
(xxxii) if the Class Principal Balances of the Class A, Class B, Class C,
Class D, Class E, Class F, Class G, Class H, Class J, Class K and Class L
Certificates have been reduced to zero, to pay principal to the Holders of the
Class M Certificates, up to an amount equal to the lesser
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of (A) the then outstanding Class Principal Balance of such Class M Certificates
and (B) the remaining Principal Distribution Amount for such Distribution Dates;
(xxxiii) to reimburse the Holders of the Class M Certificates, up to an
amount equal to all Realized Losses and Additional Trust Fund Expenses, if any,
previously deemed allocated to such Class M Certificates and for which no
reimbursement has previously been received;
(xxxiv) to pay interest to the Holders of the Class N Certificates, up to
an amount equal to all Distributable Certificate Interest in respect of such
Class N Certificates for such Distribution Date and, to the extent not
previously paid, for all prior Distribution Dates;
(xxxv) if the Class Principal Balances of the Class A, Class B, Class C,
Class D, Class E, Class F, Class G, Class H, Class J, Class K, Class L and Class
M Certificates have been reduced to zero, to pay principal to the Holders of the
Class N Certificates, up to an amount equal to the lesser of (A) the then
outstanding Class Principal Balance of such Class N Certificates and (B) the
remaining Principal Distribution Amount for such Distribution Dates;
(xxxvi) to reimburse the Holders of the Class N Certificates, up to an
amount equal to all Realized Losses and Additional Trust Fund Expenses, if any,
previously deemed allocated to such Class N Certificates and for which no
reimbursement has previously been received;
(xxxvii) to make payments to the Holders of the Class R-I Certificates up
to the amount of the Class R-I Distribution Amount for such Distribution Date;
(xxxviii) to make payments to the Holders of the Class R-II Certificates up
to the amount of the Class R-II Distribution Amount for such Distribution Date;
and
(xxxix) to pay to the Holders of the Class R-III Certificates the balance,
if any, of the Available Distribution Amount for such Distribution Date;
provided that, on the Final Distribution Date, the payments of principal to be
made pursuant to any of clauses (ii), (v), (viii), (xi), (xiv), (xvii), (xx),
(xxiii), (xxvi), (xxix), (xxxii), and (xxxv) above with respect to any Class of
Principal Balance Certificates, will be so made to the Holders thereof, up to an
amount equal to the entire then outstanding Class Principal Balance of such
Class of Certificates. References to "remaining Principal Distribution Amount"
in any of clauses (ii), (v), (viii), (xi), (xiv), (xvii), (xx), (xxiii), (xxvi)
and (xxix) above, in connection with the payments of principal to be made to the
Holders of any Class of Principal Balance Certificates, shall be to the
Principal Distribution Amount for such Distribution Date, net of any payments of
principal made in respect thereof to the Holders of each Class of Principal
Balance Certificates that have a higher Payment Priority.
On each Distribution Date, the Trustee shall withdraw any amounts then on
deposit in the Distribution Account that represent Prepayment Premiums collected
during or prior to the related Collection Period and shall distribute such
amounts, in each case, subject to available funds, as additional interest, as
follows:
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(i) to the Holders of the Class A, Class B, Class C, Class D, Class E,
Class F and Class G Certificates up to an amount equal to, in the case of each
such Class, the product of (a) such Prepayment Premiums, (b) the applicable
Discount Rate Fraction and (c) the Principal Allocation Fraction of such Class;
and
(ii) then, to the Holders of the Class X Certificates.
All of the foregoing distributions to be made from the Distribution Account
on any Distribution Date with respect to the REMIC III Certificates shall be
deemed made from the payments deemed made to REMIC II in respect of the REMIC II
Regular Interests on such Distribution Date pursuant to Section 4.01(b).
On each Distribution Date, the Trustee shall withdraw from the Distribution
Account, as Grantor Trust Assets, any amounts that represent Excess Interest
actually collected on the ARD Loans and any related REO Loans during the related
Collection Period and shall distribute with respect to their interests in the
Grantor Trust, such amounts to the holders of the Class N Certificates, without
regard to whether any such Class is entitled to distributions of interest or
principal on such Distribution Date (whether by reason of its Class Principal
Balance having been reduced to zero, by reason of it not yet being entitled to
distributions of principal, or for any other reason).
On each Distribution Date, the Trustee shall withdraw amounts from the
Excess Liquidation Proceeds Reserve Account and shall distribute such amounts in
the following priority:
(i) first, to reimburse the Holders of the Principal Balance Certificates
(in order of alphabetical Class designation) up to an amount equal to all
Realized Losses or Additional Trust Fund Expenses, if any, previously deemed
allocated to them and unreimbursed after application of the Available
Distribution Amount for such Distribution Date;
(ii) second, for distribution to the Special Servicer as additional
servicing compensation, the excess, if any, of (x) the balance of the Excess
Liquidation Proceeds Reserve Account on such Distribution Date over (y) the
aggregate Certificate Principal Balance of the Principal Balance Certificates as
of such Distribution Date;
(iii) third, upon the reduction of the aggregate Class Principal Balance of
the Principal Balance Certificates to zero, to pay any amounts remaining on
deposit in such account to the Special Servicer as additional Special Servicer
compensation.
(d) All distributions made with respect to each Class on each Distribution
Date shall be allocated pro rata among the outstanding Certificates in such
Class based on their respective Percentage Interests. Except as otherwise
provided in the last paragraph of Section 4.01(c) or as provided below, all such
distributions with respect to each Class on each Distribution Date shall be made
to the Certificateholders of the respective Class of record at the close of
business on the related Record Date and shall be made by wire transfer of
immediately available funds to the account of any such Certificateholder at a
bank or other entity having appropriate facilities therefor, if such
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Certificateholder shall have provided the Trustee with wiring instructions no
less than five Business Days prior to the related Record Date (which wiring
instructions may be in the form of a standing order applicable to all subsequent
Distribution Dates) or otherwise by check mailed to the address of such
Certificateholder as it appears in the Certificate Register. The final
distribution on each Certificate (determined without regard to any possible
future reimbursement of any Realized Loss or Additional Trust Fund Expense
previously allocated to such Certificate) will be made in like manner, but only
upon presentation and surrender of such Certificate at the offices of the
Certificate Registrar or such other location specified in the notice to
Certificateholders of such final distribution. Any distribution that is to be
made with respect to a Certificate in reimbursement of a Realized Loss or
Additional Trust Fund Expense previously allocated thereto, which reimbursement
is to occur after the date on which such Certificate is surrendered as
contemplated by the preceding sentence, will be made by check mailed to the
address of the Certificateholder that surrendered such Certificate as such
address last appeared in the Certificate Registrar or to any other address of
which the Trustee was subsequently notified in writing.
(e) Each distribution with respect to a Book-Entry Certificate shall be
paid to the Depository, as Holder thereof, and the Depository shall be
responsible for crediting the amount of such distribution to the accounts of its
Depository Participants in accordance with its normal procedures. Each
Depository Participant shall be responsible for disbursing such distribution to
the Certificate Owners that it represents and to each indirect participating
brokerage firm (a "brokerage firm" or "indirect participating firm") for which
it acts as agent. Each brokerage firm shall be responsible for disbursing funds
to the Certificate Owners that it represents. None of the Trustee, the
Certificate Registrar, the Depositor, the Master Servicer or the Special
Servicer shall have any responsibility therefor except as otherwise provided by
this Agreement or applicable law.
(f) The rights of the Certificateholders to receive distributions from the
proceeds of the Trust Fund in respect of their Certificates, and all rights and
interests of the Certificateholders in and to such distributions, shall be as
set forth in this Agreement. Neither the Holders of any Class of Certificates
nor any party hereto shall in any way be responsible or liable to the Holders of
any other Class of Certificates in respect of amounts properly previously
distributed on the Certificates. Distributions in reimbursement of Realized
Losses and Additional Trust Fund Expenses previously allocated to a Class of
Certificates shall not constitute distributions of principal and shall not
result in a reduction of the related Class Principal Balance.
(g) Except as otherwise provided in Section 9.01, whenever the Trustee
expects that the final distribution with respect to any Class of Certificates
(determined without regard to any possible future reimbursement of any Realized
Loss or Additional Trust Fund Expense previously allocated to such Class of
Certificates) will be made on the next Distribution Date, the Trustee shall, as
soon as practicable in the month in which such Distribution Date occurs, mail to
each Holder of such Class of Certificates as of the date of mailing a notice to
the effect that:
(i) the Trustee expects that the final distribution with respect to such
Class of Certificates will be made on such Distribution Date but only upon
presentation and surrender of such Certificates at the offices of the
Certificate Registrar or such other location therein specified, and
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(ii) no interest shall accrue on such Certificates from and after the
applicable Interest Accrual Period for such Distribution Date.
Any funds not distributed to any Holder or Holders of Certificates of such Class
on such Distribution Date because of the failure of such Holder or Holders to
tender their Certificates, shall, on such date, be set aside and held uninvested
in trust and credited to the account or accounts of the appropriate
non-tendering Holder or Holders. If any Certificates as to which notice has been
given pursuant to this Section 4.01(g) shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Trustee shall mail a second notice to the remaining non-tendering
Certificateholders to surrender their Certificates for cancellation in order to
receive the final distribution with respect thereto. If within one year after
the second notice all such Certificates shall not have been surrendered for
cancellation, the Trustee, directly or through an agent, shall take such steps
to contact the remaining non-tendering Certificateholders concerning the
surrender of their Certificates as it shall deem appropriate. The costs and
expenses of holding such funds in trust and of contacting such
Certificateholders following the first anniversary of the delivery of such
second notice to the non-tendering Certificateholders shall be paid out of such
funds. No interest shall accrue or be payable to any Certificateholder on any
amount held in trust hereunder by the Trustee as a result of such
Certificateholder's failure to surrender its Certificate(s) for final payment
thereof in accordance with this Section 4.01(g). If all of the Certificates
shall not have been surrendered for cancellation by the second anniversary of
the delivery of the second notice, the Trustee shall distribute all unclaimed
funds and other assets which remain subject hereto in accordance with applicable
laws.
(h) Notwithstanding any other provision of this Agreement, the Trustee
shall comply with all federal withholding requirements respecting payments to
Certificateholders of interest or original issue discount that the Trustee
reasonably believes are applicable under the Code. The consent of
Certificateholders shall not be required for such withholding. In the event the
Trustee does withhold any amount from interest or original issue discount
payments or advances thereof to any Certificateholder pursuant to federal
withholding requirements, the Trustee shall indicate the amount withheld to such
Certificateholders. All amounts withheld shall be deemed to have been paid to
such Certificateholders.
SECTION 4.02 Statements to Certificateholders; Certain Reports by the
Master Servicer and the Special Servicer.
(a) Subject to Section 8.02(v), based on information received from the
Master Servicer, on each Distribution Date, the Trustee shall provide or make
available as provided herein to all of the Holders of each Class of Certificates
(and, in the case of a Class of Book-Entry Certificates, to each Person that
provides the Trustee with an Investor Certification), to the parties hereto and
to the Rating Agencies written reports, including reports in substantially the
form attached hereto as Exhibit G (the "Distribution Date Statement"), setting
forth, among other things, the following information:
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(i) the amount of distributions, if any, made on such Distribution Date to
the holders of each Class of Principal Balance Certificates and applied to
reduce the respective Class Principal Balances thereof;
(ii) the amount of distributions, if any, made on such Distribution Date to
the Holders of each Class of REMIC III Regular Certificates allocable to (A)
Distributable Certificate Interest, (B) Prepayment Premiums and (C) Excess
Interest;
(iii) the amount of any distributions made on such Distribution Date to the
Holders of each Class of Residual Certificates;
(iv) the aggregate amount of outstanding Delinquency Advances as of the end
of the prior calendar month;
(v) the aggregate amount of Servicing Fees retained by or paid to the
Master Servicer and the Special Servicer in respect of the related Collection
Period;
(vi) the aggregate Stated Principal Balance of the Mortgage Pool
immediately before and after such Distribution Date and the percentage of the
Cut-off Date Principal Balance of the Mortgage Pool which remains outstanding
immediately after such Distribution Date;
(vii) the number, aggregate principal balance, weighted average remaining
term to maturity and weighted average Mortgage Rate of the outstanding Mortgage
Loans in the Mortgage Pool at the close of business on the related Determination
Date;
(viii) as of the Determination Date, the number and aggregate unpaid
principal balance of Mortgage Loans in the Mortgage Pool (A) delinquent one
month, (B) delinquent two months, (C) delinquent three or more months, (D) that
are Specially Serviced Mortgage Loans but are not delinquent, (E) as to which
foreclosure proceedings have been commenced or (F) as to which the related
Borrower is subject to a bankruptcy proceeding;
(ix) with respect to any Mortgage Loan as to which the related Mortgaged
Property became an REO Property during the related Collection Period, the Stated
Principal Balance and unpaid principal balance of such Mortgage Loan as of the
date such Mortgaged Property became an REO Property and the most recently
determined Appraised Value and date upon which the Appraisal was performed;
(x) as to any Mortgage Loan repurchased or otherwise liquidated or disposed
of during the related Collection Period, the loan number thereof and the amount
of any Liquidation Proceeds and/or other amounts, if any, received thereon
during the related Collection Period and the portion thereof included in the
Available Distribution Amount for such Distribution Date;
(xi) with respect to any REO Property included in the Trust Fund as of the
close of business on the last day of the related Collection Period, the loan
number of the related Mortgage Loan, the book value of such REO Property and the
amount of any income collected with respect to
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such REO Property (net of related expenses) and other amounts, if any, received
on such REO Property during the related Collection Period and the portion
thereof included in the Available Distribution Amount for such Distribution Date
and the most recently determined Appraised Value and date upon which the
Appraisal was performed;
(xii) with respect to any REO Property sold or otherwise disposed of during
the related Collection Period, the loan number of the related Mortgage Loan, and
the amount of Liquidation Proceeds and other amounts, if any, received in
respect of such REO Property during the related Collection Period, the portion
thereof included in the Available Distribution Amount for such Distribution Date
and the balance of the Excess Liquidation Proceeds Reserve Account for such
Distribution Date;
(xiii) the Distributable Certificate Interest in respect of each Class of
REMIC III Regular Certificates for such Distribution Date;
(xiv) any unpaid Distributable Certificate Interest in respect of each
Class of REMIC III Regular Certificates after giving effect to the distributions
made on such Distribution Date;
(xv) the Pass-Through Rate for each Class of REMIC III Regular Certificates
for such Distribution Date;
(xvi) the original Class Principal Balance or Class Notional Amount as of
the Closing Date and the Class Principal Balance or Class Notional Amount, as
the case may be, of each Class of REMIC III Regular Certificates immediately
before and immediately after such Distribution Date, separately identifying any
reduction in the Class Principal Balance or Class Notional Amount, as the case
may be, of each such Class due to Realized Losses and Additional Trust Fund
Expenses;
(xvii) the Certificate Factor for each Class of REMIC III Regular
Certificates immediately following such Distribution Date;
(xviii) the Principal Distribution Amount for such Distribution Date;
(xix) the aggregate amount of Principal Prepayments made during the related
Collection Period, and the aggregate amount of any Prepayment Interest Excesses
received and Prepayment Interest Shortfalls incurred in connection therewith;
(xx) the aggregate amount of Realized Losses and Additional Trust Fund
Expenses, if any, incurred with respect to the Trust Fund during the related
Collection Period;
(xxi) any Appraisal Reduction Amounts on a loan-by-loan basis, and the
total Appraisal Reduction Amounts, as of the related Determination Date;
(xxii) the net amount of any Balloon Payment Interest Excesses and Balloon
Payment Interest Shortfalls for the related Collection Period;
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(xxiii) the information with respect to the credit ratings of any Tenant or
Guarantor provided by the Master Servicer to the Trustee pursuant to Section
4.02(b) hereof on or prior to the third Business Day after the related
Determination Date; and
(xxiv) such additional information as contemplated by Exhibit G hereto.
In the case of information furnished pursuant to subclauses (i), (ii), (iii) and
(xvi) above, the amounts shall be expressed as a dollar amount in the aggregate
for all Certificates of each applicable Class and per single Certificate of a
specified minimum denomination. The form of any Distribution Date Statement may
change over time.
The Trustee shall make available to Certificateholders and other interested
parties certain information via electronic transmission as may be agreed upon by
the Depositor and the Trustee, including the information and reports described
in clauses (1) through (6) of clause (b) below and the CSSA Periodic Loan File
delivered for each Distribution Date. In addition, the Trustee shall make
available to each Certificateholder, to each Person that provides the Trustee
with an Investor Certification, to each party hereto, to each Underwriter and to
the Rating Agencies, a report (based on information received from the Master
Servicer and in a format mutually acceptable to the Trustee and the Master
Servicer) containing, information regarding the Mortgage Pool as of the close of
business on the related Determination Date, which report shall contain
substantially the categories of information regarding the Mortgage Loans set
forth in Exhibit G hereto (calculated, where applicable, on the basis of the
most recent relevant information provided by the Mortgagors to the Master
Servicer or the Special Servicer and by the Master Servicer or the Special
Servicer, as the case may be, to the Trustee) and such information shall be
presented in a tabular format substantially similar to the formats utilized in
Exhibit G hereto. On each Distribution Date, the Trustee shall make (x) certain
information contained in the monthly Distribution Date Statement available
through its ASAP System to Certificateholders and Certificate Owners calling
(000) 000-0000 and requesting statement No. 416 and (y) certain information
regarding the Mortgage Loans available in electronic format through its dial up
bulletin board service, to Certificateholders and Certificate Owners dialing
telephone number (000) 000-0000. Additionally, upon approval of the Depositor,
certain information regarding the Mortgage Loans will be made accessible at the
website maintained by LaSalle Bank National Association at xxx.xxxxxx.xxx. Such
information shall be accessible only with the use of a password provided by the
Trustee to each Person that provides the Trustee with an Investor Certification;
provided, however, that the Rating Agencies and the other parties to this
Agreement shall not be required to provide such certification; and provided,
further, that the Depositor may instruct the Trustee at any time not to require
the use of a password or the receipt of a certification. The Trustee makes no
representations or warranties as to the accuracy or completeness of such
information and assumes no responsibility therefor. In addition, the Trustee may
disclaim responsibility for any information distributed by the Trustee for which
it is not the original source. In connection with providing access to the
Trustee's internet website or electronic bulletin board, the Trustee may require
registration and acceptance of a disclaimer. The Trustee shall not be liable for
the dissemination of information in accordance with this Agreement. The Trustee
may provide such information through means other than (and in lieu of) its ASAP
System, dial up bulletin board service or website provided that (i) GMACCM shall
have consented to such
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alternative means and (ii) Certificateholders shall have received notice of such
alternative means. The provisions in this Section shall not limit the Master
Servicer's ability to make accessible certain information regarding the Mortgage
Loans at a website maintained by the Master Servicer.
Within a reasonable period of time after the end of each calendar year, the
Trustee shall furnish to each Person who at any time during the calendar year
was a Holder of a Certificate a statement containing the information as to the
applicable Class set forth in clauses (i), (ii) and (iii) of the description of
Distribution Date Statements above aggregated for such calendar year or
applicable portion thereof during which such person was a Certificateholder,
together with such other information as the Trustee determines to be necessary
to enable Certificateholders to prepare their tax returns for such calendar
year. Such obligation of the Trustee shall be deemed to have been satisfied to
the extent that substantially comparable information shall be provided by the
Trustee pursuant to any requirements of the Code as from time to time are in
force.
Upon filing with the Internal Revenue Service, the Trustee shall furnish to
the Holders of the Residual Certificates the Form 1066 and shall furnish their
respective Schedules Q thereto at the times required by the Code or the Internal
Revenue Service, and shall provide from time to time such information and
computations with respect to the entries on such forms as any Holder of the
Residual Certificates may reasonably request.
The specification of information to be furnished by the Trustee to the
Certificateholders in this Section 4.02 (and any other terms of this Agreement
requiring or calling for delivery or reporting of information by the Trustee to
Certificateholders and Certificate Owners) shall not limit the Trustee in
furnishing, and the Trustee is hereby authorized to furnish, to
Certificateholders, Certificate Owners and/or to the public any other
information (such other information, collectively, "Additional Information")
with respect to the Mortgage Loans, the Mortgaged Properties or the Trust Fund
as may be provided to it by the Depositor, the Master Servicer or the Special
Servicer or gathered by it in any investigation or other manner from time to
time, provided that (A) while there exists any Event of Default, any such
Additional Information shall only be furnished with the consent or at the
request of the Depositor (except pursuant to clause (E) below), (B) the Trustee
shall be entitled to indicate the source of all information furnished by it, and
the Trustee may affix thereto any disclaimer it deems appropriate in its sole
discretion (together with any warnings as to the confidential nature and/or the
uses of such information as it may, in its sole discretion, determine
appropriate), (C) the Trustee may notify Certificateholders and Certificate
Owners of the availability of any such information in any manner as it, in its
sole discretion, may determine, (D) the Trustee shall be entitled (but not
obligated) to require payment from each recipient of a reasonable fee for, and
its out-of-pocket expenses incurred in connection with, the collection,
assembly, reproduction or delivery of any such Additional Information, (E)
without the consent of the Depositor, the Trustee may, in its sole discretion,
furnish Additional Information to a Rating Agency in any instance, and to the
Certificateholders, Certificate Owners and/or the public-at-large if it
determines that the furnishing of such information would assist in the
evaluation of the investment characteristics or valuation of the Certificates or
would be in the best interests of the Certificateholders or is required by
applicable law and (F) the Trustee shall be entitled to distribute or make
available such Additional Information in accordance with such
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reasonable rules and procedures as it may deem necessary or appropriate (which
may include the requirement that an agreement that provides such information
shall be used solely for purposes of evaluating the investment characteristics
or valuation of the Certificates be executed by the recipient, if and to the
extent the Trustee deems the same to be necessary or appropriate). Nothing
herein shall be construed to impose upon the Trustee any obligation or duty to
furnish or distribute any Additional Information to any Person in any instance,
and the Trustee shall neither have any liability for furnishing nor for
refraining from furnishing Additional Information in any instance. The Trustee
shall be entitled (but not required) to request and receive direction from the
Depositor as to the manner of delivery of any such Additional Information, if
and to the extent the Trustee deems necessary or advisable, and to require that
any consent, direction or request given to it pursuant to this Section be made
in writing.
Upon the authorization of the Depositor, the Trustee shall make available
to Bloomberg Financial Markets, L.P. ("Bloomberg") all the electronic reports
delivered or made available pursuant to this Section 4.02(a) to the
Certificateholders and Certificate Owners using a format and media mutually
acceptable to the Trustee and Bloomberg.
(b) No later than the Business Day prior to each Distribution Date, subject
to the last paragraph of this subsection (b), the Master Servicer shall deliver
or cause to be delivered to the Trustee (and, if the Master Servicer is not the
Special Servicer, the Trustee shall deliver to the Special Servicer) in
electronic form mutually acceptable to the Trustee and the Master Servicer the
following reports or information: (1) a Delinquent Loan Status Report, (2) an
REO Status Report, (3) a Historical Loan Modification Report, (4) a Historical
Loss Report and (5) the Servicer Watch List.
No later than the Business Day prior to each Distribution Date, the Master
Servicer will deliver to the Trustee (by electronic means) a "Comparative
Financial Status Report" containing substantially the content set forth in
Exhibit I setting forth, among other things, the occupancy, revenue, net
operating income and debt service coverage ratio for each Mortgage Loan (other
than the Credit Lease Loans) or related Mortgaged Property as of the
Determination Date immediately preceding the preparation of such report for each
of the following three periods (but only to the extent the related borrower is
required by the Mortgage to deliver and does deliver, or otherwise agrees to
provide and does provide, such information): (a) the most current available
year-to-date; (b) each of the previous two full fiscal years stated separately
(to the extent such information is in the Master Servicer's possession); and (c)
the "base year" (representing the original analysis of information used as of
the Cut-Off Date).
No later than 12:00 noon, New York City time, on the second Business Day
prior to each Distribution Date, the Master Servicer will deliver to the Trustee
a CSSA Periodic Loan File setting forth certain information with respect to the
Mortgage Loans and Mortgaged Properties and a single report (the "Collection
Report") setting forth, among other things, the information specified in clauses
(i) through (vi) below (the amounts and allocations of payments, collections,
fees and expenses with respect to Specially Serviced Mortgage Loans and REO
Properties to be based upon
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the report to be delivered by the Special Servicer to the Master Servicer on the
second Business Day after the related Determination Date, in the form required
by Section 4.02(c) below):
(i) the aggregate amount that is to be transferred from the Certificate
Account to the Distribution Account in respect of such Distribution Date that is
allocable to principal on or in respect of the Mortgage Loans and any REO Loans,
separately identifying the aggregate amount of any Principal Prepayments
included therein, and (if different) the Principal Distribution Amount for the
immediately succeeding Distribution Date;
(ii) the aggregate amount that is to be transferred from the Certificate
Account to the Distribution Account in respect of such Distribution Date that is
allocable to (A) interest on or in respect of the Mortgage Loans and any REO
Loans, (B) Prepayment Premiums and (C) Excess Interest;
(iii) the aggregate amount of any Delinquency Advances made pursuant to
Section 4.03 of this Agreement as of the end of the prior calendar month that
were included in amounts deposited in the Distribution Account;
(iv) the information required to be included in the Distribution Date
Statement for the next succeeding Distribution Date and described in clauses (v)
- (xii) and (xviii) - (xxiii) of the description of the Distribution Date
Statement in Section 4.02(a);
(v) the loan number and the unpaid principal balance as of the close of
business on such Determination Date of each Specially Serviced Mortgage Loan and
each other Defaulted Mortgage Loan; and
(vi) such other information on a Mortgage Loan-by-Mortgage Loan or REO
Property-by-REO Property basis as the Trustee or the Depositor shall reasonably
request in writing (including, without limitation, information with respect to
any modifications of any Mortgage Loan, any Mortgage Loans in default or
foreclosure, the operation and disposition of REO Property and the assumption of
any Mortgage Loan).
On the date on which the report described above is delivered to the
Trustee, the Master Servicer shall also deliver or cause to be delivered to the
Trustee a report, in form reasonably acceptable to the Trustee, containing the
information with respect to the Mortgage Pool necessary for the Trustee to
prepare with respect to the Mortgage Pool any additional schedules and tables
required to be made available by the Trustee pursuant to Section 4.02(a), as
well as to prepare an updated Mortgage Loan Schedule, in each case reflecting
the changes in the Mortgage Pool during the related Collection Period.
In addition, the Master Servicer is also required to perform with respect
to each Mortgaged Property and REO Property (except any Mortgaged Property
securing a Credit Lease Loan):
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(i) Within 30 days after receipt of a quarterly operating statement,
if any, commencing with the calendar quarter ended September 30, 1999, an
"Operating Statement Analysis" containing revenue, expense, and net
operating income information substantially in accordance with Exhibit I
presenting the computation made in accordance with the methodology set
forth in Exhibit F (but only to the extent the related borrower is required
by the Mortgage to deliver and does deliver, or otherwise agrees to provide
and does provide, such information) for such Mortgaged Property or REO
Property as of the end of such calendar quarter. The Master Servicer will
deliver to the Trustee by electronic means the Operating Statement Analysis
upon request; and
(ii) Within 30 days after receipt by the Master Servicer of an annual
operating statement, an NOI adjustment analysis containing substantially
the content set forth in Exhibit I (the "NOI Adjustment Worksheet") (but
only to the extent the related borrower is required by the Mortgage to
deliver and does deliver, or otherwise agrees to provide and does provide,
such information), presenting the computation made in accordance with the
methodology described in Exhibit F to "normalize" the full year net
operating income and debt service coverage numbers used by the Master
Servicer in preparing the Comparative Financial Status Report above. The
Master Servicer will deliver to the Trustee by electronic means the "NOI
Adjustment Worksheet" upon request.
Upon request, the Trustee shall deliver or shall cause to be delivered to each
Certificateholder, to each party hereto, to any Underwriter, to the Rating
Agencies, and to each Person that provides the Trustee with an Investor
Certification a copy of the Operating Statement Analysis and NOI Adjustment
Worksheet most recently performed by the Master Servicer with respect to any
Mortgage Loan and delivered to the Trustee.
On the Business Day before each Distribution Date, the Master Servicer will
deliver to the Trustee with respect to each Tenant and any Guarantor as of a
date no earlier than three (3) Business Days prior to the related Determination
Date: (i) the publicly available corporate credit rating(s) (of the type set
forth in the Mortgage Loan Schedule) for such Tenant and any Guarantor as of
such date, (ii) the publicly available corporate credit rating(s) (of the type
set forth in the Mortgage Loan Schedule) included in the report prepared
pursuant to this Section 4.02(b) for the immediately preceding Distribution Date
(or in the case of the first Distribution Date, such ratings set forth in the
Mortgage Loan Schedule), and (iii) whether such Tenant or Guarantor has been
placed on credit watch by any Rating Agency.
Not later than the first day of the calendar month following each Master
Servicer Remittance Date, the Master Servicer shall forward to the Trustee a
statement, setting forth the status of the Certificate Account as of the close
of business on such Master Servicer Remittance Date, stating that all
remittances to the Trustee required by this Agreement to be made by the Master
Servicer have been made (or, in the case of any such required remittance that
has not been made by the Master Servicer, specifying the nature and status
thereof) and showing, for the period from the preceding Master Servicer
Remittance Date (or, in the case of the first Master Servicer Remittance Date,
from the Cut-off Date) to such Master Servicer Remittance Date, the aggregate of
deposits into
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and withdrawals from the Certificate Account for each category of deposit
specified in Section 3.04(a) and each category of withdrawal specified in
Section 3.05(a). The Master Servicer shall also deliver to the Trustee, upon
reasonable request of the Trustee, any and all additional information relating
to the Mortgage Pool in the possession of the Master Servicer (which information
shall be based upon reports delivered to the Master Servicer by the Special
Servicer with respect to Specially Serviced Mortgage Loans and REO Properties).
The Master Servicer, on the first Business Day following each Determination
Date, shall forward to the Special Servicer all information collected by the
Master Servicer which the Special Servicer is required to include in the reports
delivered by the Special Servicer pursuant to Section 4.02(c) below. Further,
the Master Servicer shall cooperate with the Special Servicer and provide the
Special Servicer with the information in the possession of the Master Servicer
reasonably requested by the Special Servicer, in writing, to the extent required
to allow the Special Servicer to perform its obligations under this Agreement
with respect to those Mortgage Loans serviced by the Master Servicer.
The obligation of the Master Servicer to deliver the reports required to be
delivered by it pursuant to this subsection (b) is subject to the Master
Servicer having received from the Special Servicer in a timely manner the
related reports and information necessary or required to enable the Master
Servicer to prepare and deliver such reports. The Master Servicer shall not be
responsible for the accuracy or content of any report, document or information
furnished by the Special Servicer to the Master Servicer pursuant to this
Agreement and accepted by the Master Servicer in good faith pursuant to this
Agreement.
(c) On the second Business Day after each Determination Date, the Special
Servicer shall forward to the Master Servicer, for each Specially Serviced
Mortgage Loan and REO Property, reports containing all information the Master
Servicer will be required to include in the other reports that the Master
Servicer is obligated to deliver to the Trustee pursuant to Section 4.02(b), to
the extent such information relates to any Specially Serviced Mortgage Loan or
any REO Property. The Special Servicer shall also deliver to the Trustee, upon
the reasonable written request of the Trustee, any and all additional
information in the possession of the Special Servicer relating to the Specially
Serviced Mortgage Loans and the REO Properties.
The Special Servicer shall cooperate with the Master Servicer and provide
the Master Servicer with the information in the possession of the Special
Servicer reasonably requested by the Master Servicer, in writing, to the extent
required to allow the Master Servicer to perform its obligations under this
Agreement with respect to the Specially Serviced Mortgage Loans and REO
Properties. Additional information regarding the Specially Serviced Mortgage
Loans and REO Properties, including, without limitation, any financial or
occupancy information (including lease summaries) provided to the Special
Servicer by the Mortgagors or otherwise obtained, shall be delivered to the
Master Servicer, within ten days of receipt.
(d) Each of the Master Servicer and Special Servicer may make information
concerning the Mortgage Loans available on any website that it has established.
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SECTION 4.03 Delinquency Advances.
(a) On each Delinquency Advance Date, the Master Servicer shall either (i)
deposit into the Certificate Account from its own funds an amount equal to the
aggregate amount of Delinquency Advances, if any, to be made in respect of the
related Distribution Date, (ii) apply amounts held in the Certificate Account
for future distribution to Certificateholders in subsequent months in discharge
of any such obligation to make Delinquency Advances, or (iii) make Delinquency
Advances in the form of any combination of (i) and (ii) aggregating the total
amount of Delinquency Advances to be made; provided that, if Late Collections
(net of related Workout Fees) of the delinquent Monthly Payments for which
Delinquency Advances are to be made for the related Distribution Date, are on
deposit in the Certificate Account and available to make such Advances, the
Master Servicer shall utilize such Late Collections to make such Advances
pursuant to clause (ii) above. Any amounts held in the Certificate Account for
future distribution and so used to make Delinquency Advances shall be
appropriately reflected in the Master Servicer's records and replaced by the
Master Servicer by deposit in the Certificate Account on or before the next
succeeding Determination Date (to the extent not previously replaced through the
deposit of Late Collections of the delinquent principal and interest in respect
of which such Delinquency Advances were made). If, as of 3:00 p.m., New York
City time, on any Master Servicer Remittance Date, the Trustee shall not have
received any Delinquency Advance required to be made by the Master Servicer
pursuant to this Section 4.03(a) (and the Master Servicer shall not have
delivered to the Trustee the requisite Officer's Certificate and documentation
related to a determination of nonrecoverability of a Delinquency Advance), then
the Trustee shall provide notice of such failure to a Servicing Officer of the
Master Servicer by facsimile transmission sent to telecopy no.(000) 000-0000 (or
such alternative number provided by the Master Servicer to the Trustee in
writing) and by telephone at telephone no. (312) 000- 0000 (Attention: Master
Servicing Manager) (or such alternative number provided by the Master Servicer
to the Trustee in writing) as soon as possible, but in any event before 5:00
p.m., New York City time, on such day. If after such notice the Trustee does not
receive the full amount of such Delinquency Advances by 11:00 a.m., New York
City time, on the Business Day immediately following such Master Servicer
Remittance Date, then the Trustee shall make the portion of such Delinquency
Advances that was required to be, but was not, made by the Master Servicer
pursuant to this Section 4.03(a). If the Trustee fails to make a Delinquency
Advance required to be made by it hereunder, the Fiscal Agent shall make such
advance no later than 1:00 p.m. New York City time on the Business Day
immediately following such Master Servicer Remittance Date. The making of such
Advance by the Fiscal Agent shall cure the failure by the Trustee to make such
Advance.
(b) The aggregate amount of Delinquency Advances to be made by the Master
Servicer in respect of the Mortgage Loans (including, without limitation,
Assumed Monthly Payments for Balloon Mortgage Loans delinquent as to their
respective Balloon Payments) and any REO Loans for any Distribution Date shall
equal, subject to subsection (c) below, the aggregate of all Monthly Payments
(other than Balloon Payments) and any Assumed Monthly Payments, in each case net
of related Workout Fees payable hereunder, that were due or deemed due, as the
case may be, in respect thereof on their respective Due Dates during the same
month as such Distribution Date and that were not paid by or on behalf of the
related Mortgagors or otherwise collected as of the
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close of business on the later of the related Due Date or the last day of the
related Collection Period; provided that, if an Appraisal Reduction Amount
exists with respect to any Required Appraisal Loan, then, in the event of
subsequent delinquencies thereon, the interest portion of the Delinquency
Advance in respect of such Required Appraisal Loan for the related Distribution
Date shall be reduced (it being herein acknowledged that there shall be no
reduction in the principal portion of such Delinquency Advance) to equal the
product of (i) the amount of the interest portion of such Delinquency Advance
for such Required Appraisal Loan for such Distribution Date without regard to
this proviso, multiplied by (ii) a fraction, expressed as a percentage, the
numerator of which is equal to the Stated Principal Balance of such Required
Appraisal Loan immediately prior to such Distribution Date, net of the related
Appraisal Reduction Amount, if any, and the denominator of which is equal to the
Stated Principal Balance of such Required Appraisal Loan immediately prior to
such Distribution Date.
(c) Notwithstanding anything herein to the contrary, no Delinquency Advance
shall be required to be made hereunder if such Delinquency Advance would, if
made, constitute a Nonrecoverable Delinquency Advance. In addition,
Nonrecoverable Delinquency Advances shall be reimbursable pursuant to Section
3.05(a) out of general collections on the Mortgage Loans and REO Properties on
deposit in the Certificate Account. The determination by the Master Servicer or,
if applicable, the Trustee or the Fiscal Agent, that it has made a
Nonrecoverable Delinquency Advance or that any proposed Delinquency Advance, if
made, would constitute a Nonrecoverable Delinquency Advance, shall be evidenced
by an Officer's Certificate delivered promptly (and, in any event, in the case
of a proposed Delinquency Advance to be made by the Master Servicer, no less
than two Business Days prior to the related Delinquency Advance Date) by the
Master Servicer to the Trustee (or, if applicable, retained thereby) and the
Depositor, setting forth the basis for such determination, together with (if
such determination is prior to the liquidation of the related Mortgage Loan or
REO Property) a copy of an Appraisal of the related Mortgaged Property or REO
Property, as the case may be, which shall have been performed within the twelve
months preceding such determination, and further accompanied by any other
information that the Master Servicer or the Special Servicer may have obtained
and that supports such determination. If such an Appraisal shall not have been
required and performed pursuant to the terms of this Agreement, the Master
Servicer, the Special Servicer, the Trustee or the Fiscal Agent, as the case may
be, may, subject to its reasonable and good faith determination that such
Appraisal will demonstrate the nonrecoverability of the related Advance, obtain
an Appraisal for such purpose at the expense of the Trust Fund. The Trustee and
the Fiscal Agent shall be entitled to rely on any determination of
nonrecoverability that may have been made by the Master Servicer or the Special
Servicer with respect to a particular Delinquency Advance, and the Master
Servicer shall be entitled to rely on any determination of nonrecoverability
that may have been made by the Special Servicer with respect to a particular
Delinquency Advance.
(d) The Master Servicer, the Trustee and the Fiscal Agent shall each be
entitled to receive interest at the Reimbursement Rate in effect from time to
time, accrued on the amount of each Delinquency Advance made thereby (out of its
own funds) for so long as such Delinquency Advance is outstanding (or, if any
Delinquency Advance is required to be made in respect of a delinquent Monthly
Payment on any Mortgage Loan prior to the end of the grace period for such
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Monthly Payment, for so long as such Delinquency Advance is outstanding
following the end of such grace period), payable first, out of Penalty Charges
received on the Mortgage Loan or REO Loan as to which such Delinquency Advance
was made and, then, once such Delinquency Advance has been reimbursed, out of
general collections on the Mortgage Loans and REO Properties pursuant to Section
3.05(a).
SECTION 4.04 Allocation of Realized Losses and Additional Trust Fund
Expenses.
(a) On each Distribution Date, following the deemed distributions to be
made in respect of the REMIC I Regular Interests pursuant to Section 4.01(a),
the Uncertificated Principal Balance of each REMIC I Regular Interest (after
taking account of such deemed distributions) shall be reduced to equal the
Stated Principal Balance of the related Mortgage Loan or REO Loan or, if
applicable, Replacement Mortgage Loan(s), as the case may be, that will be
outstanding immediately following such Distribution Date. Such reductions shall
be deemed to be an allocation of Realized Losses and Additional Trust Fund
Expenses.
(b) On each Distribution Date, following the payments deemed to be made to
REMIC III in respect of the REMIC II Regular Interests on such date pursuant to
Section 4.01(b), the Trustee shall determine the amount, if any, by which (i)
the then aggregate Uncertificated Principal Balance of REMIC II Regular
Interests LA-1, LA-2, LB, LC, LD, LE, LF, LG, LH, LJ, LK, LL, LM and LN exceeds
(ii) an amount equal to the aggregate Stated Principal Balance of the Mortgage
Pool that will be outstanding immediately following such Distribution Date. If
such excess does exist, then the respective Uncertificated Principal Balances of
such REMIC II Regular Interests shall be reduced such that the Uncertificated
Principal Balance of each REMIC II Regular Interest corresponds with the
Certificate Principal Balance of the corresponding Class of Principal Balance
Certificates outstanding after the subsequent adjustments made on such
Distribution Date under Section 4.04(c) below.
(c) On each Distribution Date, following the distributions to be made to
the Certificateholders on such date pursuant to Section 4.01(c), the Trustee
shall determine the amount, if any, by which (i) the then aggregate Certificate
Principal Balance of the Principal Balance Certificates, exceeds (ii) the
aggregate Stated Principal Balance of the Mortgage Pool that will be outstanding
immediately following such Distribution Date. If such excess does exist, then
the Class Principal Balances of the Class N, Class M, Class L, Class K, Class J,
Class H, Class G, Class F, Class E, Class D, Class C and Class B Certificates
shall be reduced sequentially, in that order, in each case, until the first to
occur of such excess being reduced to zero or the related Class Principal
Balance being reduced to zero. If, after the foregoing reductions, the amount
described in clause (i) of the second preceding sentence still exceeds the
amount described in clause (ii) of the second preceding sentence, then the
respective Class Principal Balances of the Class A-1 and Class A-2 Certificates
shall be reduced, pro rata in accordance with the relative sizes of the then
outstanding Class Principal Balances of such Classes of Certificates, until the
first to occur of such excess being reduced to zero or each such Class Principal
Balance being reduced to zero. Such reductions in the
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Class Principal Balances of the respective Classes of Principal Balance
Certificates shall be deemed to be allocations of Realized Losses and Additional
Trust Fund Expenses.
ARTICLE V
THE CERTIFICATES
SECTION 5.01 The Certificates.
(a) The Certificates will be substantially in the respective forms annexed
hereto as Exhibits A-1 through A-15. (In the case of the Class N Certificates,
with the inclusion or exclusion of appropriate bracketed provisions contained in
Exhibit A-15 to reflect the applicable subclass designation.) The Certificates
will be issuable in registered form only; provided, however, that in accordance
with Section 5.03 beneficial ownership interests in the Registered Certificates
shall initially be held and transferred through the book-entry facilities of the
Depository. The Non-Registered Certificates will be issued as Definitive
Certificates. The REMIC III Regular Certificates will be issuable in
denominations corresponding to initial Certificate Principal Balances or
Certificate Notional Amounts, as the case may be, as of the Closing Date of not
less than $25,000 in the case of the Class A-1, Class A-2, Class B, Class C,
Class D and Class E, $100,000 in the case of the Class F, Class G, Class H,
Class J, Class K, Class L, Class M and Class N Certificates, and $1,000,000 in
the case of the Class X Certificates, and in each such case in any whole dollar
denomination in excess thereof; provided, however, that a single Certificate of
each Class thereof may be issued in a different denomination. The Residual
Certificates will be issuable only in denominations representing Percentage
Interests of not less than 20% in the related Class.
(b) The Certificates shall be executed by manual or facsimile signature on
behalf of the Trustee in its capacity as trustee hereunder by an authorized
officer. Certificates bearing the manual or facsimile signatures of individuals
who were at any time the authorized officers of the Trustee shall be entitled to
all benefits under this Agreement, subject to the following sentence,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Certificates or did not
hold such offices at the date of such Certificates. No Certificate shall be
entitled to any benefit under this Agreement, or be valid for any purpose,
however, unless there appears on such Certificate a certificate of
authentication substantially in the form provided for herein executed by the
Certificate Registrar by manual signature, and such certificate of
authentication upon any Certificate shall be conclusive evidence, and the only
evidence, that such Certificate has been duly authenticated and delivered
hereunder. All Certificates shall be dated the date of their authentication.
SECTION 5.02 Registration of Transfer and Exchange of Certificates.
(a) At all times during the term of this Agreement, there shall be
maintained at the office of the Certificate Registrar a Certificate Register in
which, subject to such reasonable regulations as the Certificate Registrar may
prescribe, the Certificate Registrar shall provide for the registration of
Certificates and of transfers and exchanges of Certificates as herein provided.
The Trustee is hereby initially appointed (and hereby agrees to act in
accordance with the terms hereof)
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as Certificate Registrar for the purpose of registering Certificates and
transfers and exchanges of Certificates as herein provided. The Certificate
Registrar may appoint, by a written instrument delivered to the Depositor, the
Master Servicer and the Special Servicer, any other bank or trust company to act
as Certificate Registrar under such conditions as the predecessor Certificate
Registrar may prescribe, provided that the predecessor Certificate Registrar
shall not be relieved of any of its duties or responsibilities hereunder by
reason of such appointment. If the Trustee resigns or is removed in accordance
with the terms hereof, the successor trustee shall immediately succeed to its
predecessor's duties as Certificate Registrar. The Depositor, the Master
Servicer and the Special Servicer, shall have the right to inspect the
Certificate Register or to obtain a copy thereof at all reasonable times, and to
rely conclusively upon a certificate of the Certificate Registrar as to the
information set forth in the Certificate Register.
(b) (i) No transfer of any Non-Registered Certificate shall be made unless
such transfer is made pursuant to an effective registration statement under the
Securities Act, and effective registration or qualification under applicable
state securities laws, or is made in a transaction that does not require such
registration or qualification. If such a transfer is to be made without
registration under the Securities Act, other than a transfer by the Depositor or
an Affiliate thereof, then the Trustee shall require, in order to assure
compliance with such laws, receipt by it and the Depositor of:
(A) if such transfer is purportedly being made in reliance upon Rule 144A
under the Securities Act, a certificate from the Certificateholder desiring
to effect such transfer substantially in the form attached as Exhibit B-1
hereto and a certificate from such Certificateholder's prospective
transferee substantially in the form attached as Exhibit B-2 hereto; and
(B) in all other cases, (1) a certificate from the Certificateholder
desiring to effect such transfer substantially in the form attached hereto
as Exhibit B-1 and a certificate from such Certificateholder's prospective
transferee substantially in the form attached hereto as Exhibit B-3, and
(2) unless the Depositor directs otherwise, an Opinion of Counsel
satisfactory to the Trustee and the Depositor to the effect that such
transfer may be made without such registration (which Opinion of Counsel
shall not be an expense of the Trust Fund or of the Depositor, the Master
Servicer, the Special Servicer, the Trustee, the Fiscal Agent or the
Certificate Registrar in their respective capacities as such).
(ii) None of the Depositor, the Trustee, the Fiscal Agent or the
Certificate Registrar is obligated to register or qualify any Class of
Non-Registered Certificates under the Securities Act or any other securities law
or to take any action not otherwise required under this Agreement to permit the
transfer of any Non-Registered Certificate without registration or
qualification. Any Holder of a Non-Registered Certificate desiring to effect
such a transfer shall, and does hereby agree to, indemnify the Depositor, the
Trustee, the Fiscal Agent and the Certificate Registrar against any liability
that may result if the transfer is not so exempt or is not made in accordance
with such federal and state laws.
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(c) (i) No transfer of a Senior Certificate or any interest therein shall
be made (A) to any employee benefit plan or other retirement arrangement,
including individual retirement accounts and annuities, Xxxxx plans and
collective investment funds and separate accounts in which such plans, accounts
or arrangements are invested, that is subject to ERISA or Section 4975 of the
Code (each, a "Plan"), or (B) to any Person who is directly or indirectly
purchasing such Certificate or interest therein on behalf of, as named fiduciary
of, as trustee of, or with "plan assets" of a Plan, unless: (1) such Plan
qualifies for the exemptive relief available under the terms of Prohibited
Transaction Exemption 94-29 (granted to certain affiliates of the Depositor) or
Prohibited Transaction Exemption 89-88, 90-83 or FAN 97-03-E (December 9, 1996)
granted to the underwriters of the Certificates and (2) at the time of such
transfer, the Senior Certificates continue to be rated in one of the top three
rating categories by at least one Rating Agency.
(ii) No transfer of a Non-Registered Certificate shall be made (A) to any
Plan or (B) to any Person who is directly or indirectly purchasing such
Certificate or interest therein on behalf of, as named fiduciary of, as trustee
of, or with "plan assets" of a Plan, unless the prospective transferee provides
the Depositor, the Trustee, the Fiscal Agent and the Master Servicer with an
opinion of counsel satisfactory to the Depositor, the Trustee, the Fiscal Agent
and the Master Servicer that such transfer is permissible under applicable law,
will not constitute or result in any non-exempt prohibited transaction under
ERISA or Section 4975 of the Code and will not subject the Depositor, the
Trustee, the Fiscal Agent or the Master Servicer to any obligation in addition
to those undertaken herein. In lieu of such opinion of counsel, the prospective
transferee of a Non-Registered Certificate that is not a Residual Certificate
may provide a certification of facts substantially to the effect that the
purchase of such Certificate by or on behalf of, or with "plan assets" of, any
Plan is permissible under applicable law, will not constitute or result in any
non-exempt prohibited transaction under ERISA or Section 4975 of the Code, will
not subject the Depositor, the Trustee, the Fiscal Agent or the Master Servicer
to any obligation in addition to those undertaken herein, and the following
conditions are met: (a) the source of funds used to purchase such Certificate is
an "insurance company general account" (as such term is defined in United States
Department of Labor Prohibited Transaction Class Exemption 95-60 ("PTCE 95-60"))
and (b) the conditions set forth in Sections I and III of PTCE 95-60 have been
satisfied as of the date of the acquisition of such Certificates. Any purchaser
of Book-Entry Certificates will be deemed to have represented by such purchase
that either (a) such purchaser is not a Plan and is not purchasing such
Certificates by or on behalf of, or with "plan assets" of, any Plan or (b) the
purchase of any such Certificate by or on behalf of, or with "plan assets" of,
any Plan is permissible under applicable law, will not result in any non-exempt
prohibited transaction under ERISA or Section 4975 of the Code, and will not
subject the Depositor, the Trustee, the Fiscal Agent or the Master Servicer to
any obligation in addition to those undertaken herein, and the following
conditions are met: (a) the source of funds used to purchase such Certificate is
an "insurance company general account" (as such term is defined in PTCE 95-60)
and (b) the conditions set forth in Sections I and III of PTCE 95-60 have been
satisfied as of the date of the acquisition of such Certificates. The Trustee
may require that any prospective transferee of a Subordinated Certificate that
is held as a Definitive Certificate provide such certifications as the Trustee
may deem desirable or necessary in order to establish that such transferee or
the Person in whose name such registration is requested is not a Plan or a
Person who is directly or indirectly purchasing such Certificate on behalf of,
as named fiduciary
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of, as trustee of, or with "plan assets" of a Plan. The Trustee shall not have
any responsibility to monitor or restrict the transfer of Ownership Interests in
any Certificates that are in the form of a Book-Entry Certificate.
(d) (i) Each Person who has or who acquires any Ownership Interest in a
Residual Certificate shall be deemed by the acceptance or acquisition of such
Ownership Interest to have agreed to be bound by the following provisions and to
have irrevocably authorized the Trustee under clause (ii)(A) below to deliver
payments to a Person other than such Person and to have irrevocably authorized
the Trustee under clause (ii)(B) below to negotiate the terms of any mandatory
sale and to execute all instruments of Transfer and to do all other things
necessary in connection with any such sale. The rights of each Person acquiring
any Ownership Interest in a Residual Certificate are expressly subject to the
following provisions:
(A) Each Person holding or acquiring any Ownership Interest in a
Residual Certificate shall be a Permitted Transferee and a United States
Person and shall promptly notify the Trustee of any change or impending
change in its status as a Permitted Transferee.
(B) In connection with any proposed Transfer of any Ownership Interest
in a Residual Certificate, the Trustee shall require delivery to it, and no
Transfer of any Residual Certificate shall be registered until the Trustee
receives, an affidavit and agreement substantially in the form attached
hereto as Exhibit C-1 (a "Transfer Affidavit and Agreement") from the
proposed Transferee, in form and substance satisfactory to the Trustee,
representing and warranting, among other things, that such Transferee is a
Permitted Transferee, that it is not acquiring its Ownership Interest in
the Residual Certificate that is the subject of the proposed Transfer as a
nominee, trustee or agent for any Person that is not a Permitted
Transferee, that for so long as it retains its Ownership Interest in a
Residual Certificate, it will endeavor to remain a Permitted Transferee,
that it is a United States Person, and that it has reviewed the provisions
of this Section 5.02(d) and agrees to be bound by them.
(C) Notwithstanding the delivery of a Transfer Affidavit and Agreement
by a proposed Transferee under clause (B) above, if the Trustee has actual
knowledge that the proposed Transferee is not a Permitted Transferee or is
not a United States Person, no Transfer of an Ownership Interest in a
Residual Certificate to such proposed Transferee shall be effected.
(D) Each Person holding or acquiring any Ownership Interest in a
Residual Certificate shall agree (1) to require a Transfer Affidavit and
Agreement from any prospective Transferee to whom such Person attempts to
transfer its Ownership Interest in such Residual Certificate and (2) not to
transfer its Ownership Interest in such Residual Certificate unless it
provides to the Trustee a certificate substantially in the form attached
hereto as Exhibit C-2 stating that, among other things, it has no actual
knowledge that such prospective Transferee is not a Permitted Transferee or
is not a United States Person.
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(E) Each Person holding or acquiring an Ownership Interest in a
Residual Certificate, by purchasing an Ownership Interest in such
Certificate, agrees to give the Trustee written notice that it is a
"pass-through interest holder" within the meaning of temporary Treasury
regulation Section 1.67-3T(a)(2)(i)(A) immediately upon acquiring an
Ownership Interest in a Residual Certificate, if it is, or is holding an
Ownership Interest in a Residual Certificate on behalf of, a "pass-through
interest holder".
(ii) (A) If any purported Transferee shall become a Holder of a Residual
Certificate in violation of the provisions of this Section 5.02(d) or if any
Holder of a Residual Certificate shall lose its status as a Permitted Transferee
or a United States Person, then the last preceding Holder of such Residual
Certificate that was in compliance with the provisions of this Section 5.02(d)
shall be restored, to the extent permitted by law, to all rights as Holder
thereof retroactive to the date of registration of such Transfer of such
Residual Certificate. None of the Trustee, the Master Servicer, the Special
Servicer or the Certificate Registrar shall be under any liability to any Person
for any registration of Transfer of a Residual Certificate that is in fact not
permitted by this Section 5.02(d) or for making any payments due on such
Certificate to the Holder thereof or for taking any other action with respect to
such Holder under the provisions of this Agreement.
(B) If any purported Transferee shall become a Holder of a Residual
Certificate in violation of the restrictions in this Section 5.02(d), or if
any Holder of a Residual Certificate shall lose its status as a Permitted
Transferee or a United States Person, and to the extent that the
retroactive restoration of the rights of the prior Holder of such Residual
Certificate as described in clause (ii)(A) above shall be invalid, illegal
or unenforceable, then the Trustee shall have the right, without notice to
the Holder or any prior Holder of such Residual Certificate, to sell such
Residual Certificate to a purchaser selected by the Trustee on such terms
as the Trustee may choose. Such non-complying Holder shall promptly endorse
and deliver such Residual Certificate in accordance with the instructions
of the Trustee. Such purchaser may be the Trustee itself or any Affiliate
of the Trustee. The proceeds of such sale, net of the commissions (which
may include commissions payable to the Trustee or its Affiliates), expenses
and taxes due, if any, will be remitted by the Trustee to such
non-complying Holder. The terms and conditions of any sale under this
clause (ii)(B) shall be determined in the sole discretion of the Trustee,
and the Trustee shall not be liable to any Person having an Ownership
Interest in a Residual Certificate as a result of its exercise of such
discretion.
(iii) The Trustee shall make available to the Internal Revenue Service and
those Persons specified by the REMIC Provisions, all information necessary to
compute any tax imposed (A) as a result of the Transfer of an Ownership Interest
in a Residual Certificate to any Person who is not a Permitted Transferee,
including the information described in Treasury Regulations Sections
1.860D-1(b)(5) and 1.860E-2(a)(5)with respect to the "excess inclusions" of such
Residual Certificate and (B) as a result of any regulated investment company,
real estate investment trust,
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common trust fund, partnership, trust, estate or organization described in
Section 1381 of the Code that holds an Ownership Interest in a Residual
Certificate having as among its record holders at any time any Person which is
not a Permitted Transferee. The Person holding such Ownership Interest shall be
responsible for the reasonable compensation of the Trustee for providing such
information.
(iv) The provisions of this Section 5.02(d) set forth prior to this
subsection (iv) may be modified, added to or eliminated, provided that there
shall have been delivered to the Trustee and the Depositor the following:
(A) written notification from each Rating Agency to the effect that
the modification of, addition to or elimination of such provisions will not
cause such Rating Agency to qualify, downgrade or withdraw its then-current
rating of any Class of Certificates; and
(B) an Opinion of Counsel, in form and substance satisfactory to the
Trustee and the Depositor, to the effect that such modification of,
addition to or elimination of such provisions will not cause any of REMIC
I, REMIC II or REMIC III to (x) cease to qualify as a REMIC or (y) be
subject to an entity-level tax caused by the Transfer of any Residual
Certificate to a Person which is not a Permitted Transferee, or cause a
Person other than the prospective Transferee to be subject to a
REMIC-related tax caused by the Transfer of a Residual Certificate to a
Person which is not a Permitted Transferee.
(e) Subject to the preceding subsections, upon surrender for registration
of transfer of any Certificate at the offices of the Certificate Registrar
maintained for such purpose, the Trustee shall execute and the Certificate
Registrar shall authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Certificates of the same Class of a
like aggregate Percentage Interest.
(f) At the option of any Holder, its Certificates may be exchanged for
other Certificates of authorized denominations of the same Class of a like
aggregate Percentage Interest, upon surrender of the Certificates to be
exchanged at the offices of the Certificate Registrar maintained for such
purpose. Whenever any Certificates are so surrendered for exchange, the Trustee
shall execute and the Certificate Registrar shall authenticate and deliver the
Certificates which the Certificateholder making the exchange is entitled to
receive.
(g) Every Certificate presented or surrendered for transfer or exchange
shall (if so required by the Trustee or the Certificate Registrar) be duly
endorsed by, or be accompanied by a written instrument of transfer in the form
satisfactory to the Trustee and the Certificate Registrar duly executed by, the
Holder thereof or his attorney duly authorized in writing.
(h) No service charge shall be imposed for any transfer or exchange of
Certificates, but the Trustee or the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
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(i) All Certificates surrendered for transfer and exchange shall be
physically canceled by the Certificate Registrar, and the Certificate Registrar
shall hold such canceled Certificates in accordance with its standard
procedures.
(j) Upon request, the Certificate Registrar shall provide the Master
Servicer, the Special Servicer and the Depositor with an updated copy of the
Certificate Register on or about January 1 and July 1 of each year, commencing
January 1, 2000.
SECTION 5.03 Book-Entry Certificates.
(a) Each Class of Registered Certificates shall initially be issued as one
or more Certificates registered in the name of the Depository or its nominee
and, except as provided in subsection (c) below, transfer of such Certificates
may not be registered by the Certificate Registrar unless such transfer is to a
successor Depository that agrees to hold such Certificates for the respective
Certificate Owners with Ownership Interests therein. Such Certificate Owners
shall hold and transfer their respective Ownership Interests in and to such
Certificates through the book-entry facilities of the Depository and, except as
provided in subsection (c) below, shall not be entitled to definitive, fully
registered Certificates ("Definitive Certificates") in respect of such Ownership
Interests. The Trustee shall not have any responsibility to monitor or restrict
the transfer of Ownership Interests in any Book-Entry Certificate. All transfers
by Certificate Owners of their respective Ownership Interests in the Book-Entry
Certificates shall be made in accordance with the procedures established by the
Depository Participant or brokerage firm representing such Certificate Owner.
Each Depository Participant shall only transfer the Ownership Interests in the
Book-Entry Certificates of Certificate Owners it represents or of brokerage
firms for which it acts as agent in accordance with the Depository's normal
procedures.
(b) The Trustee, the Master Servicer, the Special Servicer, the Depositor
and the Certificate Registrar may for all purposes, including the making of
payments due on the Book-Entry Certificates, deal with the Depository as the
authorized representative of the Certificate Owners with respect to such
Certificates for the purposes of exercising the rights of Certificateholders
hereunder. The rights of Certificate Owners with respect to the Book-Entry
Certificates shall be limited to those established by law and agreements between
such Certificate Owners and the Depository Participants and brokerage firms
representing such Certificate Owners. Multiple requests and directions from, and
votes of, the Depository as Holder of the Book-Entry Certificates with respect
to any particular matter shall not be deemed inconsistent if they are made with
respect to different Certificate Owners. The Trustee may establish a reasonable
record date in connection with solicitations of consents from or voting by
Certificateholders and shall give notice to the Depository of such record date.
(c) If (i)(A) the Depositor advises the Trustee and the Certificate
Registrar in writing that the Depository is no longer willing or able to
properly discharge its responsibilities with respect to the Book-Entry
Certificates, and (B) the Depositor is unable to locate a qualified successor,
or (ii) the Depositor at its option advises the Trustee and the Certificate
Registrar in writing that it elects to terminate the book-entry system through
the Depository, the Trustee shall notify all Certificate Owners, through the
Depository, of the occurrence of any such event and of the availability of
Definitive Certificates to Certificate Owners requesting the same. Upon
surrender
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to the Certificate Registrar of the Book-Entry Certificates by the
Depository, accompanied by registration instructions from the Depository for
registration of transfer and any other documents necessary to satisfy the
requirements of any applicable transfer restrictions, the Trustee shall execute,
and the Certificate Registrar shall authenticate and deliver, the applicable
Definitive Certificates to the Certificate Owners identified in such
instructions. None of the Depositor, the Master Servicer, the Special Servicer,
the Trustee, the Fiscal Agent or the Certificate Registrar shall be liable for
any delay in delivery of such instructions, and each may conclusively rely on,
and shall be protected in relying on, such instructions. Upon the issuance of
Definitive Certificates for purposes of evidencing ownership of the Registered
Certificates held in book-entry form, the registered holders of such Definitive
Certificates shall be recognized as Certificateholders hereunder and,
accordingly, shall be entitled directly to receive payments on, to exercise
Voting Rights with respect to, and to transfer and exchange such Definitive
Certificates.
SECTION 5.04 Mutilated, Destroyed, Lost or Stolen Certificates.
If (i) any mutilated Certificate is surrendered to the Certificate
Registrar, or the Certificate Registrar receives evidence to its satisfaction of
the destruction, loss or theft of any Certificate, and (ii) there is delivered
to the Trustee and the Certificate Registrar such security or indemnity as may
be required by them to save each of them harmless, then, in the absence of
actual notice to the Trustee or the Certificate Registrar that such Certificate
has been acquired by a bona fide purchaser, the Trustee shall execute, and the
Certificate Registrar shall authenticate and deliver, in exchange for or in lieu
of any such mutilated, destroyed, lost or stolen Certificate, a new Certificate
of the same Class and like Percentage Interest. Upon the issuance of any new
Certificate under this Section, the Trustee and the Certificate Registrar may
require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses (including
the fees and expenses of the Trustee and the Certificate Registrar) connected
therewith. Any replacement Certificate issued pursuant to this Section shall
constitute complete and indefeasible evidence of ownership in the applicable
REMIC, as if originally issued, whether or not the lost, stolen or destroyed
Certificate shall be found at any time.
SECTION 5.05 Persons Deemed Owners.
Prior to due presentation of a Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Fiscal Agent, the Certificate Registrar and any agents of any of them may treat
the person in whose name such Certificate is registered as of the related Record
Date as the owner of such Certificate for the purpose of receiving distributions
pursuant to Section 4.01 and for all other purposes whatsoever, except as and to
the extent provided in the definition of "Certificateholder", and none of the
Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Certificate Registrar or any agent of any of them shall be affected by notice to
the contrary except as provided in Section 5.02(d).
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ARTICLE VI
THE DEPOSITOR, THE MASTER SERVICER AND THE SPECIAL SERVICER
SECTION 6.01 Liability of the Depositor, the Master Servicer and the
Special Servicer.
The Depositor, the Master Servicer and the Special Servicer shall be liable
in accordance herewith only to the extent of the respective obligations
specifically imposed upon and undertaken by the Depositor, the Master Servicer
and the Special Servicer herein.
SECTION 6.02 Merger, Consolidation or Conversion of the Depositor, the
Master Servicer and the Special Servicer; Assignment of Rights
and Delegation of Duties by the Master Servicer and the
Special Servicer.
(a) Subject to subsection (b) below, the Depositor, the Master Servicer and
the Special Servicer each will keep in full effect its existence, rights and
franchises as a corporation under the laws of the jurisdiction of its
incorporation, and each will obtain and preserve its qualification to do
business as a foreign corporation in each jurisdiction in which such
qualification is or shall be necessary to protect the validity and
enforceability of this Agreement, the Certificates or any of the Mortgage Loans
and to perform its respective duties under this Agreement.
(b) The Depositor, the Master Servicer and the Special Servicer may be
merged or consolidated with or into any Person, or transfer all or substantially
all of its assets to any Person, in which case any Person resulting from any
merger or consolidation to which the Depositor, the Master Servicer or the
Special Servicer shall be a party, or any Person succeeding to the business of
the Depositor, the Master Servicer and the Special Servicer, shall be the
successor of the Depositor, the Master Servicer and the Special Servicer, as the
case may be, hereunder, without the execution or filing of any paper or any
further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding; provided that (i) such Person is qualified to service
multifamily mortgage loans on behalf of FNMA or FHLMC and (ii) such merger,
consolidation or succession will not result in the downgrade, qualification or
withdrawal of the then-current ratings of the Classes of Certificates that have
been so rated (as evidenced by a letter to such effect from each Rating Agency).
(c) Notwithstanding anything else in this Section 6.02 and Section 6.04 to
the contrary, the Master Servicer and the Special Servicer may assign all of its
rights and delegate all of its duties and obligations under this Agreement;
provided that the Person accepting such assignment or delegation shall be a
Person that is qualified to service multifamily mortgage loans on behalf of FNMA
or FHLMC, is reasonably satisfactory to the Trustee and the Depositor, is
willing to service the Mortgage Loans and executes and delivers to the Depositor
and the Trustee an agreement, in form and substance reasonably satisfactory to
the Depositor and the Trustee, which contains an assumption by such Person of
the due and punctual performance and observance of each covenant and condition
to be performed or observed by the Master Servicer or the Special Servicer, as
the case may be, under this Agreement; provided further that such assignment or
delegation will not result in the downgrade, qualification or withdrawal of the
then-current ratings of the Classes of Certificates that have been rated (as
evidenced by a letter to such effect from each Rating Agency). In the case of
any such assignment and delegation, the Master Servicer or the Special Servicer,
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as the case may be, shall be released from its obligations under this Agreement,
except that the Master Servicer or the Special Servicer, as the case may be,
shall remain liable for all liabilities and obligations incurred by it, or
arising from its conduct, hereunder prior to the satisfaction of the conditions
to such assignment and delegation set forth in the preceding sentence.
Notwithstanding anything above to the contrary, each of the Master Servicer and
the Special Servicer may, in its sole discretion, appoint Sub-Servicers in
accordance with Section 3.22 hereof and independent contractors or agents to
perform select duties thereof, provided that the Master Servicer or the Special
Servicer shall not be relieved from such duties solely by virtue of such
appointment.
SECTION 6.03 Limitation on Liability of the Depositor, the Master Servicer,
the Special Servicer and Others.
None of the Depositor, the Master Servicer, the Special Servicer or any of
the directors, officers, employees or agents of the Depositor, the Master
Servicer or the Special Servicer shall be under any liability to the Trust Fund
or the Certificateholders for any action taken or for refraining from the taking
of any action in good faith pursuant to this Agreement or for errors in
judgment; provided, however, that this provision shall not protect the
Depositor, the Master Servicer, the Special Servicer or any such Person against
any breach of warranties or representations made herein or any liability which
would otherwise be imposed by reason of willful misfeasance, bad faith or
negligence in the performance of duties or by reason of reckless disregard of
obligations and duties hereunder. The Depositor, the Master Servicer, the
Special Servicer and any director, officer, employee or agent of the Depositor,
the Master Servicer or the Special Servicer may rely in good faith on any
document of any kind prima facie properly executed and submitted by any Person
respecting any matters arising hereunder. The Depositor, the Master Servicer and
the Special Servicer and any director, officer, employee or agent of the
Depositor, the Master Servicer or the Special Servicer shall be indemnified by
the Trust Fund and held harmless against any loss, liability or expense incurred
in connection with any legal action relating to this Agreement or the
Certificates or any asset of the Trust Fund, other than any loss, liability or
expense specifically required to be borne by such Person pursuant to the terms
hereof, or which constitutes a Servicing Advance (and is otherwise specifically
reimbursable hereunder), or which is incurred by such Person by reason of such
Person's willful misfeasance, bad faith or negligence in the performance of such
Person's duties hereunder or by reason of such Person's reckless disregard of
obligations and duties hereunder.
None of the Depositor, the Master Servicer or the Special Servicer shall be
under any obligation to appear in, prosecute or defend any legal or
administrative action, proceeding, hearing or examination that is not incidental
to its respective duties under this Agreement and which in its opinion may
involve it in any ultimate expense or liability; provided, however, that the
Depositor, the Master Servicer or the Special Servicer may in its discretion
undertake any such action, proceeding, hearing or examination that it may deem
necessary or desirable in respect to this Agreement and the rights and duties of
the parties hereto and the interests of the Certificateholders
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hereunder. In such event, the legal expenses and costs of such action,
proceeding, hearing or examination and any liability resulting therefrom shall
be expenses, costs and liabilities of the Trust Fund, and the Depositor, the
Master Servicer and the Special Servicer shall be entitled to be reimbursed
therefor out of amounts attributable to the Mortgage Loans on deposit in the
Certificate Account as provided by Section 3.05(a).
SECTION 6.04 Depositor, Master Servicer and Special Servicer Not to Resign.
Subject to the provisions of Section 6.02, none of the Depositor, the
Master Servicer or the Special Servicer shall resign from its respective
obligations and duties hereby imposed on it except upon determination that its
duties hereunder are no longer permissible under applicable law. Any such
determination permitting the resignation of the Depositor, the Master Servicer
or the Special Servicer shall be evidenced by an Opinion of Counsel to such
effect delivered to the Trustee. No such resignation by the Master Servicer or
the Special Servicer shall become effective until the Trustee or a successor
servicer shall have assumed the responsibilities and obligations of the Master
Servicer or the Special Servicer, as the case may be, in accordance with Section
7.02.
SECTION 6.05 Rights of the Depositor in Respect of the Master Servicer and
the Special Servicer.
The Depositor may, but is not obligated to, enforce the obligations of the
Master Servicer and the Special Servicer hereunder and may, but is not obligated
to, perform, or cause a designee to perform, any defaulted obligation of the
Master Servicer or the Special Servicer hereunder or exercise the rights of the
Master Servicer or the Special Servicer hereunder; provided, however, that
neither the Master Servicer nor the Special Servicer shall be relieved of any of
its obligations hereunder by virtue of such performance by the Depositor or its
designee. The Depositor shall not have any responsibility or liability for any
action or failure to act by the Master Servicer or the Special Servicer and is
not obligated to supervise the performance of the Master Servicer or the Special
Servicer under this Agreement or otherwise.
ARTICLE VII
DEFAULT
SECTION 7.01 Events of Default.
(a) "Event of Default", wherever used herein, means any one of the
following events:
(i) (A) any failure by the Master Servicer to make a required deposit to
the Certificate Account which continues unremedied for one Business Day
following the date on which such deposit was first required to be made, or (B)
any failure by the Master Servicer to deposit into, or to remit to the Trustee
for deposit into, the Distribution Account any amount required to be so
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deposited or remitted, which failure is not remedied by 11:00 a.m. (New York
City time) on the relevant Distribution Date; or
(ii) any failure by the Special Servicer to deposit into, or to remit to
the Master Servicer for deposit into, the Certificate Account any amount
required to be so deposited or remitted under this Agreement which failure
continues unremedied for one Business Day following the date on which such
deposit or remittance was first required to be made; or
(iii) any failure by the Master Servicer or the Special Servicer to timely
make any Servicing Advance required to be made by it pursuant to this Agreement
which continues unremedied for a period ending on the earlier of (A) 15 days
following the date such Servicing Advance was first required to be made, and (B)
either, if applicable, (1) in the case of a Servicing Advance relating to the
payment of insurance premiums, the day on which such insurance coverage
terminates if such premiums are not paid or (2) in the case of a Servicing
Advance relating to the payment of real estate taxes, the date of the
commencement of a foreclosure action with respect to the failure to make such
payment; or
(iv) any failure on the part of the Master Servicer or the Special Servicer
duly to observe or perform in any material respect any other of the covenants or
agreements on the part of the Master Servicer or the Special Servicer contained
in this Agreement which continues unremedied for a period of 30 days after the
date on which written notice of such failure, requiring the same to be remedied,
shall have been given to the Master Servicer or the Special Servicer, as the
case may be, by the Trustee or the Depositor, or to the Master Servicer or the
Special Servicer, as the case may be by the Holders of Certificates entitled to
not less than 25% of the Voting Rights; provided, however, that if such covenant
or agreement is capable of being cured and the Master Servicer or Special
Servicer, as applicable, is diligently pursuing such cure, such 30 day period
shall be extended for an additional 30 days; or
(v) any breach on the part of the Master Servicer or the Special Servicer
of any representation or warranty contained in this Agreement which materially
and adversely affects the interests of any Class of Certificateholders and which
continues unremedied for a period of 30 days after the date on which notice of
such breach, requiring the same to be remedied, shall have been given to the
Master Servicer or the Special Servicer by the Trustee or the Depositor, or to
the Master Servicer or the Special Servicer, as the case may be by the Holders
of Certificates entitled to not less than 25% of the Voting Rights; provided,
however, if such breach is capable of being cured and the Master Servicer or
Special Servicer, as applicable, such 30 day period shall be extended for an
additional 30 days; or
(vi) a decree or order of a court or agency or supervisory authority having
jurisdiction in the premises in an involuntary case under any present or future
federal or state bankruptcy, insolvency or similar law for the appointment of a
conservator, receiver, liquidator, trustee or similar official in any
bankruptcy, insolvency, readjustment of debt, marshalling of assets and
liabilities or similar proceedings, or for the winding-up or liquidation of its
affairs, shall have been entered against the Master Servicer or the Special
Servicer and such decree or order shall have remained in force undischarged or
unstayed for a period of 60 days; or
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(vii) the Master Servicer or the Special Servicer shall consent to the
appointment of a conservator, receiver, liquidator, trustee or similar official
in any bankruptcy, insolvency, readjustment of debt, marshalling of assets and
liabilities or similar proceedings of or relating to it or of or relating to all
or substantially all of its property; or
(viii) the Master Servicer or the Special Servicer shall admit in writing
its inability to pay its debts generally as they become due, file a petition to
take advantage of any applicable bankruptcy, insolvency or reorganization
statute, make an assignment for the benefit of its creditors, voluntarily
suspend payment of its obligations, or take any corporate action in furtherance
of the foregoing; or
(ix) the Trustee shall have received written notice from FITCH IBCA or
Xxxxx'x that the continuation of the Master Servicer or the Special Servicer in
such capacity would result in the downgrade, qualification or withdrawal of any
rating then assigned by such Rating Agency to any Class of Certificates, or
(x) the Master Servicer or the Special Servicer is removed from Standard &
Poor's approved master servicer list or special servicer list, as the case may
be, and the ratings of any of the Certificates by Standard & Poor's are
downgraded, qualified or withdrawn (including, without limitation, placed on
"negative credit watch") in connection with such removal.
(b) If any Event of Default with respect to the Master Servicer or the
Special Servicer (in either case for purposes of this Section 7.01(b), the
"Defaulting Party") shall occur and be continuing, then, and in each and every
such case, so long as such Event of Default shall not have been remedied, the
Depositor or the Trustee may, and at the written direction of the Holders of
Certificates entitled to at least 51% of the Voting Rights, the Trustee shall
terminate, by notice in writing to the Defaulting Party, with a copy of such
notice to the Depositor (if the termination is effected by the Trustee) or to
the Trustee (if the termination is effected by the Depositor), all of the rights
and obligations of the Defaulting Party under this Agreement and in and to the
Mortgage Loans and the proceeds thereof (other than any rights of the Defaulting
Party as Certificateholder). From and after the receipt by the Defaulting Party
of such written notice, all authority and power of the Defaulting Party under
this Agreement, whether with respect to the Certificates (other than as a Holder
of any Certificate) or the Mortgage Loans or otherwise, shall pass to and be
vested in the Trustee pursuant to and under this Section, and, without
limitation, the Trustee is hereby authorized and empowered to execute and
deliver, on behalf of and at the expense of the Defaulting Party, as
attorney-in-fact or otherwise, any and all documents and other instruments, and
to do or accomplish all other acts or things necessary or appropriate to effect
the purposes of such notice of termination, whether to complete the transfer and
endorsement or assignment of the Mortgage Loans and related documents, or
otherwise. The Master Servicer and the Special Servicer each agrees that if it
is terminated pursuant to this Section 7.01(b), it shall promptly (and in any
event no later than ten Business Days subsequent to its receipt of the notice of
termination) provide the Trustee or any other Successor Master Servicer or
Special Servicer with all documents and records requested by it to enable it to
assume the Master Servicer's or Special Servicer's, as the case may be,
functions hereunder, and shall cooperate with the Trustee or any other Successor
Master Servicer or Special
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Servicer in effecting the termination of the Master Servicer's or Special
Servicer's, as the case may be, responsibilities and rights hereunder,
including, without limitation, the transfer within two Business Days to the
Trustee or any other Successor Master Servicer or Special Servicer for
administration by it of all cash amounts which shall at the time be or should
have been credited by the Master Servicer or the Special Servicer to the
Certificate Account, the Distribution Account, the REO Account or any Servicing
Account or thereafter be received with respect to the Mortgage Loans or any REO
Property (provided, however, that the Master Servicer and the Special Servicer
each shall continue to be entitled to receive all amounts accrued or owing to it
under this Agreement on or prior to the date of such termination, whether in
respect of Advances made by it or otherwise, and it and its directors, officers,
employees and agents shall continue to be entitled to the benefits of Section
6.03 notwithstanding any such termination).
SECTION 7.02 Trustee to Act; Appointment of Successor.
On and after the time the Master Servicer or the Special Servicer resigns
pursuant to Section 6.04 or receives a notice of termination pursuant to Section
7.01, the Trustee shall be the successor in all respects to the Master Servicer
or the Special Servicer, as the case may be, in its capacity as such under this
Agreement and the transactions set forth or provided for herein and shall be
subject to all the responsibilities, duties and liabilities relating thereto and
arising thereafter placed on the Master Servicer or the Special Servicer, as the
case may be, by the terms and provisions hereof, including, without limitation,
the Master Servicer's obligation to make Delinquency Advances; provided that any
failure to perform such duties or responsibilities caused by the Master
Servicer's or the Special Servicer's failure to provide information or monies
required by Section 7.01 shall not be considered a default by the Trustee
hereunder. The Trustee shall not be liable for any of the representations and
warranties of the Master Servicer or the Special Servicer or for any losses
incurred by the Master Servicer or the Special Servicer pursuant to Section 3.06
hereunder nor shall the Trustee be required to purchase any Mortgage Loan
hereunder. As compensation therefor, the Trustee shall be entitled to the
applicable Master Servicing Fee and Special Servicing Fee and all funds relating
to the Mortgage Loans which the Master Servicer or the Special Servicer would
have been entitled to charge to the Certificate Account or the Distribution
Account if the Master Servicer or the Special Servicer had continued to act
hereunder. Notwithstanding the above, the Trustee may, if it shall be unwilling
to so act, or shall, if it is unable to so act or if the Holders of Certificates
entitled to at least 51% of the Voting Rights so request in writing to the
Trustee or if the Trustee is not approved as a master servicer or special
servicer, as the case may be, by each Rating Agency, promptly appoint any FNMA
or FHLMC-approved mortgage loan servicing institution that has a net worth of
not less than $10,000,000 and is otherwise acceptable to each Rating Agency (as
evidenced by written confirmation therefrom to the effect that the appointment
of such institution would not result in the downgrade, qualification or
withdrawal of its rating then assigned to any Class of Certificates), as the
successor to the Master Servicer hereunder or the Special Servicer, as the case
may be, in the assumption of all or any part of the responsibilities, duties or
liabilities of the Master Servicer or the Special Servicer, as the case may be,
hereunder. No appointment of a successor to the Master Servicer or the Special
Servicer, as the case may be, hereunder shall be effective until the assumption
of the successor to the Master Servicer or the Special Servicer, as the case may
be, of all the responsibilities, duties and liabilities
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of the Master Servicer or the Special Servicer, as the case may be, hereunder.
Pending appointment of a successor to the Master Servicer or the Special
Servicer, as the case may be, hereunder, the Trustee shall act in such capacity
as hereinabove provided. In connection with any such appointment and assumption
described herein, the Trustee may make such arrangements for the compensation of
such successor out of payments on Mortgage Loans or otherwise as it and such
successor shall agree; provided, however, that no such compensation shall be in
excess of that permitted the resigning or terminated party hereunder. The
Depositor, the Trustee and such successor shall take such action, consistent
with this Agreement, as shall be necessary to effectuate any such succession.
SECTION 7.03 Notification to Certificateholders.
(a) Upon any resignation of the Master Servicer or the Special Servicer
pursuant to Section 6.04, any termination of the Master Servicer or the Special
Servicer pursuant to Section 7.01 or any appointment of a successor to the
Master Servicer or the Special Servicer pursuant to Section 7.02, the Trustee
shall give prompt written notice thereof to Certificateholders at their
respective addresses appearing in the Certificate Register.
(b) Not later than the later of (i) 60 days after the occurrence of any
event which constitutes or, with notice or lapse of time or both, would
constitute an Event of Default and (ii) five days after the Trustee would be
deemed to have notice of the occurrence of such an event in accordance with
Section 8.02(vii), the Trustee shall transmit by mail to the Depositor and all
Certificateholders notice of such occurrence, unless such default shall have
been cured.
SECTION 7.04 Waiver of Events of Default.
The Holders of Certificates representing at least 66 2/3% of the Voting
Rights allocated to the Classes of Certificates affected by any Event of Default
hereunder may waive such Event of Default; provided, however, that an Event of
Default under clause (i) or (ii) of Section 7.01 may be waived only by all of
the Certificateholders of the affected Classes. Upon any such waiver of an Event
of Default, such Event of Default shall cease to exist and shall be deemed to
have been remedied for every purpose hereunder. No such waiver shall extend to
any subsequent or other Event of Default or impair any right consequent thereon
except to the extent expressly so waived. Notwithstanding any other provisions
of this Agreement, for purposes of waiving any Event of Default pursuant to this
Section 7.04, Certificates registered in the name of the Depositor or any
Affiliate of the Depositor shall be entitled to the same Voting Rights with
respect to the matters described above as they would if any other Person held
such Certificates.
ARTICLE VIII
CONCERNING THE TRUSTEE AND THE FISCAL AGENT
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SECTION 8.01 Duties of Trustee and Fiscal Agent.
(a) The Trustee, prior to the occurrence of an Event of Default and after
the curing or waiver of all Events of Default which may have occurred,
undertakes to perform such duties and only such duties as are specifically set
forth in this Agreement. If an Event of Default occurs and is continuing, the
Trustee (other than as successor Master Servicer or Special Servicer) shall
exercise such of the rights and powers vested in it by this Agreement, and use
the same degree of care and skill in their exercise as a prudent man would
exercise or use under the circumstances in the conduct of his own affairs. Any
permissive right of the Trustee contained in this Agreement shall not be
construed as a duty.
(b) The Trustee, upon receipt of all resolutions, certificates, statements,
opinions, reports, documents, orders or other instruments furnished to the
Trustee which are specifically required to be furnished pursuant to any
provision of this Agreement (other than the Mortgage Files, the review of which
is specifically governed by the terms of Article II), shall examine them to
determine whether they conform to the requirements of this Agreement. If any
such instrument is found not to conform to the requirements of this Agreement in
a material manner, the Trustee shall take such action as it deems appropriate to
have the instrument corrected. Neither the Trustee, nor the Fiscal Agent shall
be responsible for the accuracy or content of any resolution, certificate,
statement, opinion, report, document, order or other instrument furnished by the
Depositor, the Master Servicer or the Special Servicer or any other person and
accepted by the Trustee in good faith, pursuant to this Agreement.
(c) No provision of this Agreement shall be construed to relieve the
Trustee or the Fiscal Agent from liability for its own negligent action, its own
negligent failure to act or its own willful misconduct; provided, however, that:
(i) Prior to the occurrence of an Event of Default, and after the curing of
all such Events of Default which may have occurred, the duties and obligations
of the Trustee and the Fiscal Agent shall be determined solely by the express
provisions of this Agreement, the Trustee and the Fiscal Agent shall not be
liable except for the performance of such duties and obligations as are
specifically set forth in this Agreement, no implied covenants or obligations
shall be read into this Agreement against the Trustee or the Fiscal Agent and,
in the absence of bad faith on the part of the Trustee or the Fiscal Agent, the
Trustee and the Fiscal Agent may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, upon any
certificates or opinions furnished to the Trustee or the Fiscal Agent and
conforming to the requirements of this Agreement;
(ii) Neither the Trustee nor the Fiscal Agent shall be personally liable
for an error of judgment made in good faith by a Responsible Officer or
Responsible Officers of the Trustee or the Fiscal Agent, unless it shall be
proved that the Trustee was negligent in ascertaining the pertinent facts; and
(iii) The Trustee shall not be personally liable with respect to any action
taken, suffered or omitted to be taken by it in good faith in accordance with
the direction of Holders of
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Certificates entitled to at least 25% of the Voting Rights relating to the time,
method and place of conducting any proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred upon the Trustee, under this
Agreement.
SECTION 8.02 Certain Matters Affecting the Trustee.
Except as otherwise provided in Section 8.01:
(i) The Trustee and the Fiscal Agent may rely upon and shall be protected
in acting or refraining from acting upon any resolution, Officer's Certificate,
certificate of auditors or any other certificate, statement, instrument,
opinion, report, notice, request, consent, order, appraisal, bond or other paper
or document reasonably believed by it to be genuine and to have been signed or
presented by the proper party or parties;
(ii) The Trustee and the Fiscal Agent may consult with counsel and the
written advice of such counsel or any Opinion of Counsel shall be full and
complete authorization and protection in respect of any action taken or suffered
or omitted by it hereunder in good faith and in accordance therewith and the
expense of such consultation with counsel shall be reimbursable under Section
8.05(b) hereof;
(iii) Neither the Trustee nor the Fiscal Agent (in their respective
capacities as such) shall be under any obligation to exercise any of the trusts
or powers vested in it by this Agreement or to make any investigation of matters
arising hereunder or to institute, conduct or defend any litigation hereunder or
in relation hereto at the request, order or direction of any of the
Certificateholders, pursuant to the provisions of this Agreement, unless such
Certificateholders shall have offered to the Trustee or the Fiscal Agent, as
applicable, reasonable security or indemnity against the costs, expenses and
liabilities which may be incurred therein or thereby; neither the Trustee nor
the Fiscal Agent shall be required to expend or risk its own funds or otherwise
incur any financial liability in the performance of any of its duties hereunder,
or in the exercise of any of its rights or powers, if it shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it; nothing contained herein
shall, however, relieve the Trustee of the obligation, upon the occurrence of an
Event of Default which has not been cured, to exercise such of the rights and
powers vested in it by this Agreement, and to use the same degree of care and
skill in their exercise as a prudent man would exercise or use under the
circumstances in the conduct of his own affairs;
(iv) Neither the Trustee nor the Fiscal Agent shall be personally liable
for any action reasonably taken, suffered or omitted by it in good faith and
believed by it to be authorized or within the discretion or rights or powers
conferred upon it by this Agreement;
(v) Prior to the occurrence of an Event of Default hereunder and after the
curing of all Events of Default which may have occurred, the Trustee shall not
be bound to make any investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion, report, notice,
request, consent, order, approval, bond or other paper or document, unless
requested in writing to do so by Holders of Certificates entitled to at least
50% of the Voting Rights;
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provided, however, that if the payment within a reasonable time to the Trustee
of the costs, expenses or liabilities likely to be incurred by it in the making
of such investigation is, in the opinion of the Trustee, not reasonably assured
to the Trustee by the security afforded to it by the terms of this Agreement,
the Trustee may require reasonable indemnity against such expense or liability
as a condition to taking any such action;
(vi) The Trustee nor the Fiscal Agent may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by or
through agents, provided that the Trustee shall not be relieved from such
duties, and the Trustee shall remain responsible for all acts and omissions of
any such agent;
(vii) For all purposes under this Agreement, the Trustee shall not be
deemed to have notice of any Event of Default unless a Responsible Officer of
the Trustee has actual knowledge thereof or unless written notice of any event
which is in fact such a default is received by the Trustee at the Corporate
Trust Office, and such notice references the Certificates or this Agreement; and
(viii) Neither the Trustee nor the Fiscal Agent shall be responsible for
any act or omission of the Master Servicer or the Special Servicer (unless the
Trustee is acting as Master Servicer or the Special Servicer, as the case may
be) or of the Depositor or any other person.
SECTION 8.03 Trustee and Fiscal Agent not Liable for Validity or
Sufficiency of Certificates or Mortgage Loans.
The recitals contained herein and in the Certificates, other than the
representations and warranties of, and the other statements attributed to the
Trustee in Sections 2.02, 2.05, 2.07 and 8.13 and the signature of the Trustee
set forth on each outstanding Certificate, shall be taken as the statements of
the Depositor, the Master Servicer or the Special Servicer, as the case may be,
and neither the Trustee nor the Fiscal Agent assume responsibility for their
correctness. Neither the Trustee nor the Fiscal Agent make any representations
as to the validity or sufficiency of this Agreement (except to the extent set
forth in Section 8.13) or of any Certificate (other than as to the signature of
the Trustee set forth thereon) or of any Mortgage Loan or related document.
Neither the Trustee nor the Fiscal Agent shall be accountable for the use or
application by the Depositor of any of the Certificates issued to it or of the
proceeds of such Certificates, or for the use or application of any funds paid
to the Depositor in respect of the assignment of the Mortgage Loans to the Trust
Fund, or any funds deposited in or withdrawn from the Certificate Account or any
other account by or on behalf of the Depositor, the Master Servicer or the
Special Servicer. Neither the Trustee nor the Fiscal Agent shall be responsible
for the accuracy or content of any resolution, certificate, statement, opinion,
report, document, order or other instrument furnished by the Depositor, the
Master Servicer or the Special Servicer, and accepted by the Trustee or the
Fiscal Agent in good faith, pursuant to this Agreement.
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SECTION 8.04 Trustee and the Fiscal Agent May Own Certificates.
Each of the Trustee and the Fiscal Agent, in their individual or any other
capacity, may become the owner or pledgee of Certificates with the same rights
it would have if it were not Trustee or the Fiscal Agent.
SECTION 8.05 Fees and Expenses of Trustee; Indemnification of Trustee and
the Fiscal Agent.
(a) Monthly, the Trustee shall be entitled to withdraw the Trustee Fee from
the Distribution Account pursuant to Section 3.05(b) for all services rendered
by it in the execution of the trusts hereby created and in the exercise and
performance of any of the powers and duties hereunder of the Trustee. On or
prior to the Distribution Date in each month, the Trustee shall be entitled to
withdraw and pay itself from amounts then on deposit in the Distribution Account
an amount equal to the then unpaid Trustee Fees.
(b) The Trustee, Fiscal Agent and any director, officer, employee or agent
of the Trustee and the Fiscal Agent and any of its directors, officers,
employees or agents shall be indemnified and held harmless by the Trust Fund (to
the extent of amounts on deposit in the Distribution Account from time to time)
against any loss, liability or expense (including, without limitation, costs and
expenses of litigation, and of investigation, counsel fees, damages, judgments
and amounts paid in settlement) arising out of, or incurred in connection with,
any act or omission of the Trustee and the Fiscal Agent relating to the exercise
and performance of any of the powers and duties of the Trustee and the Fiscal
Agent hereunder; provided that neither the Trustee, the Fiscal Agent nor any of
the other above specified Persons shall be entitled to indemnification pursuant
to this Section 8.05(b) for (i) allocable overhead, (ii) expenses or
disbursements incurred or made by or on behalf of the Trustee or the Fiscal
Agent in the normal course of the Trustee's and the Fiscal Agent's performing
their routine duties in accordance with any of the provisions hereof, (iii) any
expense or liability specifically required to be borne thereby pursuant to the
terms hereof, or (iv) any loss, liability or expense incurred by reason of
willful misfeasance, bad faith or negligence in the performance of the Trustee's
or Fiscal Agent's obligations and duties hereunder, or by reason of reckless
disregard of such obligations or duties, or as may arise from a breach of any
representation, warranty or covenant of the Trustee or Fiscal Agent made herein.
The provisions of this Section 8.05(b) shall survive any resignation or removal
of the Trustee and appointment of a successor trustee or fiscal agent.
SECTION 8.06 Eligibility Requirements for Trustee and Fiscal Agent.
The Trustee hereunder shall at all times be an association or a corporation
organized and doing business under the laws of the United States of America or
any State thereof or the District of Columbia, authorized under such laws to
exercise trust powers, having a combined capital and surplus of at least
$100,000,000 and subject to supervision or examination by federal or state
authority. If such association or corporation publishes reports of condition at
least annually, pursuant to law or to the requirements of the aforesaid
supervising or examining authority, then for the purposes of this Section the
combined capital and surplus of such association or corporation shall
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be deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. The long-term unsecured debt obligations of
the Trustee shall at all times be rated not less than "Aa2" by Xxxxx'x, "AA" by
Standard & Poor's and "AA" by FITCH IBCA (or, if not rated by FITCH IBCA,
otherwise acceptable to FITCH IBCA as would not result in a qualification,
downgrade or withdrawal of the rating assigned by FITCH IBCA to any Class of
Certificates) or if and for so long as a Fiscal Agent is appointed and acting
hereunder, at least investment grade by each Rating Agency (or, if not rated by
FITCH IBCA, otherwise acceptable to FITCH IBCA as would not result in a
qualification, downgrade or withdrawal of the rating assigned by FITCH IBCA to
any Class of Certificates); provided, that either the Trustee or the Fiscal
Agent shall at all times be an institution whose long term senior unsecured debt
is rated not less than "AA" by Standard & Poor's "Aa2" by Xxxxx and "AA" by
FITCH IBCA or such other rating as shall not result in the qualification,
downgrade or withdrawal of any of the ratings then assigned to the respective
Classes of Certificates, as confirmed in writing by each Rating Agency. In case
at any time the Trustee or the Fiscal Agent shall cease to be eligible in
accordance with the provisions of this Section, the Trustee or the Fiscal Agent
shall resign immediately in the manner and with the effect specified in Section
8.07; provided that if the Trustee shall cease to be so eligible because its
combined capital and surplus is no longer at least $100,000,000 or its long-term
unsecured debt rating no longer conforms to the requirements of the immediately
preceding sentence, and if the Trustee proposes to the other parties hereto to
enter into an agreement with (and reasonably acceptable to) each of them or the
Trustee appoints a fiscal agent, and if in light of such agreement or such
appointment, the Trustee's continuing to act in such capacity would not (as
evidenced in writing by each rating Agency) cause any Rating Agency to qualify,
downgrade or withdraw any rating assigned thereby to any Class of Certificates,
then upon the execution and delivery of such agreement or the effectiveness of
such appointment, the Trustee shall not be required to resign, and may continue
in such capacity, for so long as none of the ratings assigned by the Rating
Agencies to the Certificates is adversely affected thereby. The corporation or
association serving as Trustee may have normal banking and trust relationships
with the Depositor, the Master Servicer, the Special Servicer and their
respective Affiliates.
SECTION 8.07 Resignation and Removal of the Trustee and the Fiscal Agent.
(a) The Trustee or the Fiscal Agent may at any time resign and be
discharged from the trusts hereby created by giving written notice thereof to
the Depositor, the Master Servicer, the Special Servicer and to all
Certificateholders. Upon receiving such notice of resignation, the Depositor
shall promptly appoint a successor trustee or fiscal agent acceptable to the
Master Servicer by written instrument, in duplicate, which instrument shall be
delivered to the resigning Trustee or the Fiscal Agent and to the successor
trustee. A copy of such instrument shall be delivered to the Master Servicer,
the Special Servicer and the Certificateholders by the Depositor. If no
successor trustee or fiscal agent shall have been so appointed and have accepted
appointment within 30 days after the giving of such notice of resignation, the
resigning Trustee or the Fiscal Agent may petition any court of competent
jurisdiction for the appointment of a successor trustee.
(b) If at any time the Trustee or Fiscal Agent shall cease to be eligible
in accordance with the provisions of Section 8.06 and shall fail to resign after
written request therefor
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by the Depositor or the Master Servicer, or if at any time the Trustee or Fiscal
Agent shall become incapable of acting, or shall be adjudged bankrupt or
insolvent, or a receiver of the Trustee or Fiscal Agent or of its property shall
be appointed, or any public officer shall take charge or control of the Trustee
or Fiscal Agent or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation, then the Depositor may remove the Trustee or Fiscal
Agent and appoint a successor trustee or fiscal agent acceptable to the Master
Servicer by written instrument, in duplicate, which instrument shall be
delivered to the Trustee or Fiscal Agent so removed and to the successor trustee
or fiscal agent. A copy of such instrument shall be delivered to the Master
Servicer, the Special Servicer and the Certificateholders by the Depositor.
(c) The Holders of Certificates entitled to at least 51% of the Voting
Rights may at any time remove the Trustee or the Fiscal Agent and appoint a
successor trustee or fiscal agent by written instrument or instruments, in
triplicate, signed by such Holders or their attorneys-in-fact duly authorized,
one complete set of which instruments shall be delivered to the Master Servicer,
one complete set to the Trustee so removed and one complete set to the successor
so appointed. A copy of such instrument shall be delivered to the Depositor, the
Special Servicer and the remaining Certificateholders by the Master Servicer.
(d) Any resignation or removal of the Trustee or the Fiscal Agent and
appointment of a successor trustee or fiscal agent pursuant to any of the
provisions of this Section 8.07 shall not become effective until acceptance of
appointment by the successor trustee or fiscal agent as provided in Section
8.08. Upon any succession of the Trustee or the Fiscal Agent under this
Agreement, the predecessor Trustee or the Fiscal Agent shall be entitled to the
payment of compensation and reimbursement for services rendered and expenses
incurred (including without limitation unreimbursed Advances and interest
thereon made thereby) accrued or payable up to and including the effective date
of such termination, at such times and from such sources as if the predecessor
Trustee or the Fiscal Agent had not resigned or been removed. Any resignation or
removal of the Trustee shall be deemed to be a simultaneous removal of the
Fiscal Agent hereunder.
SECTION 8.08 Successor Trustee and the Fiscal Agent.
(a) Any successor trustee or fiscal agent appointed as provided in Section
8.07 shall execute, acknowledge and deliver to the Depositor, the Master
Servicer, the Special Servicer and to its predecessor trustee an instrument
accepting such appointment hereunder, and thereupon the resignation or removal
of the predecessor trustee or fiscal agent shall become effective and such
successor trustee or fiscal agent, without any further act, deed or conveyance,
shall become fully vested with all the rights, powers, duties and obligations of
its predecessor hereunder, with the like effect as if originally named as
trustee or fiscal agent herein. The predecessor trustee or fiscal agent shall
deliver to the successor trustee or fiscal agent all Mortgage Files and related
documents and statements held by it hereunder (other than any Mortgage Files at
the time held on its behalf by a Custodian, which Custodian shall become the
agent of the successor trustee), and the Depositor, the Master Servicer, the
Special Servicer and the predecessor trustee or fiscal agent shall execute and
deliver such instruments and do such other things as may reasonably be required
to more fully and certainly vest and confirm in the successor trustee all such
rights, powers, duties and obligations,
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and to enable the successor trustee and fiscal agent, if applicable, to perform
its obligations hereunder.
(b) No successor trustee or fiscal agent shall accept appointment as
provided in this Section 8.08 unless at the time of such acceptance such
successor trustee or fiscal agent shall be eligible under the provisions of
Section 8.06.
(c) Upon acceptance of appointment by a successor trustee as provided in
this Section 8.08, the successor trustee or fiscal agent shall mail notice of
such appointment to the Depositor and the Certificateholders.
SECTION 8.09 Merger or Consolidation of Trustee and the Fiscal Agent.
Any entity into which the Trustee or the Fiscal Agent may be merged or
converted or with which it may be consolidated or any entity resulting from any
merger, conversion or consolidation to which the Trustee or the Fiscal Agent
shall be a party, or any entity succeeding to the corporate trust business of
the Trustee or the Fiscal Agent, shall be the successor of the Trustee or the
Fiscal Agent hereunder, provided such entity shall be eligible under the
provisions of Section 8.06, without the execution or filing of any paper or any
further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding.
SECTION 8.10 Appointment of Co-Trustee or Separate Trustee.
(a) Notwithstanding any other provisions hereof, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Trust Fund or property securing the same may at the time be located, the
Master Servicer and the Trustee acting jointly shall have the power and shall
execute and deliver all instruments to appoint one or more Persons approved by
the Trustee to act as co-trustee or co-trustees, jointly with the Trustee, or
separate trustee or separate trustees, of all or any part of the Trust Fund, and
to vest in such Person or Persons, in such capacity, such title to the Trust
Fund, or any part thereof, and, subject to the other provisions of this Section
8.10, such powers, duties, obligations, rights and trusts as the Master Servicer
and the Trustee may consider necessary or desirable. If the Master Servicer
shall not have joined in such appointment within fifteen days after the receipt
by it of a request to do so, or in case an Event of Default in respect of the
Master Servicer shall have occurred and be continuing, the Trustee alone shall
have the power to make such appointment. No co-trustee or separate trustee
hereunder shall be required to meet the terms of eligibility as a successor
trustee under Section 8.06 hereunder and no notice to Holders of Certificates of
the appointment of co-trustee(s) or separate trustee(s) shall be required under
Section 8.08 hereof.
(b) In the case of any appointment of a co-trustee or separate trustee
pursuant to this Section 8.10 all rights, powers, duties and obligations
conferred or imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or co-trustee
jointly, except to the extent that under any law of any jurisdiction in which
any particular act or acts are to be performed (whether as Trustee hereunder or
as successor to the Master Servicer or the Special Servicer hereunder), the
Trustee shall be incompetent or unqualified to
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perform such act or acts, in which event such rights, powers, duties and
obligations (including the holding of title to the Trust Fund or any portion
thereof in any such jurisdiction) shall be exercised and performed by such
separate trustee or co-trustee at the direction of the Trustee.
(c) Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the then separate trustees and co-trustees,
as effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Agreement and the conditions
of this Article VIII. Each separate trustee and co-trustee, upon its acceptance
of the trusts conferred, shall be vested with the estates or property specified
in its instrument of appointment, either jointly with the Trustee or separately,
as may be provided therein, subject to all the provisions of this Agreement,
specifically including every provision of this Agreement relating to the conduct
of, affecting the liability of, or affording protection to, the Trustee. Every
such instrument shall be filed with the Trustee.
(d) Any separate trustee or co-trustee may, at any time, constitute the
Trustee, its agent or attorney-in-fact, with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the appointment of a new or
successor trustee.
(e) The appointment of a co-trustee or separate trustee under this Section
8.10 shall not relieve the Trustee of its duties and responsibilities hereunder.
SECTION 8.11 Appointment of Custodians.
The Trustee may, with the consent of the Master Servicer, appoint one or
more Custodians to hold all or a portion of the Mortgage Files as agent for the
Trustee. Each Custodian shall be a depository institution subject to supervision
by federal or state authority, shall itself (or together with an affiliate
guaranteeing its financial performance) have a combined capital and surplus of
at least $15,000,000, shall have long-term unsecured debt obligation ratings
from FITCH IBCA of at least "BBB" or be otherwise acceptable to FITCH IBCA,
shall be qualified to do business in the jurisdiction in which it holds any
Mortgage File, shall maintain and keep in full force and effect throughout the
term of this Agreement a fidelity bond and an errors and omissions insurance
policy covering its officers and employees and other persons acting on its
behalf in connection with its activities under the Agreement in the amount of
coverage customary for custodians acting in such capacity, and shall not be the
Depositor, a Mortgage Loan Seller or any Affiliate of the Depositor or a
Mortgage Loan Seller. Each Custodian shall be subject to the same obligations
and standard of care as would be imposed on the Trustee hereunder in connection
with the retention of Mortgage Files directly by the Trustee. The appointment of
one or more Custodians shall not relieve the Trustee from any of its obligations
hereunder, and the Trustee shall remain responsible for all acts and omissions
of any Custodian.
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SECTION 8.12 Access to Certain Information.
(a) On or prior to the date of the first sale of any Non-Registered
Certificate to an Independent third party, the Depositor shall provide to the
Trustee ten copies of any private placement memorandum or other disclosure
document used by the Depositor or its Affiliate in connection with the offer and
sale of the Class of Certificates to which such Non-Registered Certificate
belongs. In addition, if any such private placement memorandum or disclosure
document is revised, amended or supplemented at any time following the delivery
thereof to the Trustee, the Depositor promptly shall inform the Trustee of such
event and shall deliver to the Trustee ten copies of the private placement
memorandum or disclosure document, as revised, amended or supplemented. The
Trustee shall maintain at its offices primarily responsible for administering
the Trust Fund (or at the Primary Servicing Office of the Master Servicer) and
shall, upon reasonable advance notice, make available during normal business
hours for review by any Holder, Certificate Owner or prospective transferee of a
Certificate or interest therein, originals or copies of the following items: (i)
in the case of a Holder, Certificate Owner or prospective transferee of a
Non-Registered Certificate or interest therein, any private placement memorandum
or other disclosure document relating to the Class of Certificates to which such
Non-Registered Certificate belongs, in the form most recently provided to the
Trustee; and (ii) in all cases, (A) this Agreement and any amendments hereto
entered into pursuant to Section 11.01, (B) all reports required to be delivered
to Certificateholders of the relevant Class pursuant to Section 4.02 since the
Closing Date, (C) all Officer's Certificates delivered to the Trustee since the
Closing Date pursuant to Section 3.13, (D) all accountants' reports delivered to
the Trustee since the Closing Date pursuant to Section 3.14, (E) the most recent
inspection report prepared by the Master Servicer or Special Servicer and
delivered to the Trustee in respect of each Mortgaged Property pursuant to
Section 3.12, (F) as to each Mortgage Loan pursuant to which the related
Mortgagor is required to deliver such items or the Master Servicer or Special
Servicer has otherwise acquired such items, the most recent annual operating
statement and rent roll of the related Mortgaged Property and financial
statements of the related Mortgagor collected by the Master Servicer or the
Special Servicer and delivered to the Trustee pursuant to Section 3.12(b), (G)
any and all notices and reports delivered to the Trustee with respect to any
Mortgaged Property securing a defaulted Mortgage Loan as to which the
environmental testing contemplated by Section 3.09(c) revealed that either of
the conditions set forth in clauses (i) and (ii) of the first sentence thereof
was not satisfied (but only for so long as such Mortgaged Property or the
related Mortgage Loan are part of the Trust Fund), (H) the respective Mortgage
Files, including, without limitation, any and all modifications, waivers and
amendments of the terms of a Mortgage Loan entered into by the Master Servicer
or the Special Servicer and delivered to the Trustee pursuant to Section 3.20
(but only for so long as the affected Mortgage Loan is part of the Trust Fund),
(I) copies of any Appraisals performed as a result of an Appraisal Reduction
Event, and (J) any and all Officer's Certificates and other evidence delivered
to or retained by the Trustee to support the Master Servicer's, Special
Servicer's, or Trustee's or Fiscal Agent's determination that any Advance was
or, if made, would be a Nonrecoverable Advance. Copies of any and all of the
foregoing items will be available from the Trustee upon written request;
however, the Trustee shall be permitted to require from the requesting
Certificateholder payment of a sum sufficient to cover the reasonable costs and
expenses of providing such copies.
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In connection with providing access to or copies of the items described in
the preceding paragraph, the Trustee may require (a) in the case of Certificate
Owners, a written confirmation executed by the requesting Person, in form
reasonably satisfactory to the Trustee, generally to the effect that such Person
is a beneficial holder of Certificates, is requesting the information solely for
use in evaluating such Person's investment in the Certificates and will
otherwise keep such information confidential and (b) in the case of a
prospective purchaser, a written confirmation executed by the requesting Person,
in form reasonably satisfactory to the Trustee, generally to the effect that
such Person is a prospective purchaser of a Certificate or an interest therein,
is requesting the information solely for use in evaluating a possible investment
in Certificates and will otherwise keep such information confidential. All
Certificateholders, by the acceptance of their Certificates, shall be deemed to
have agreed to keep such information confidential. Notwithstanding the foregoing
provisions of this Section 8.12(a), the Trustee shall have no responsibility for
the accuracy, completeness or sufficiency for any purpose of any information so
made available or furnished by it pursuant to this Section 8.12(a).
(b) The Trustee shall provide or cause to be provided to the Depositor, the
Master Servicer, and the Special Servicer, and to the Office of Thrift
Supervision, the Federal Deposit Insurance Corporation, and any other federal or
state banking or insurance regulatory authority that may exercise authority over
any Certificateholder, access to the Mortgage Files and any other documentation
regarding the Mortgage Loans and the Trust Fund within its control which may be
required by this Agreement or by applicable law. Such access shall be afforded
without charge but only upon reasonable prior written request and during normal
business hours at the offices of the Trustee designated by it.
SECTION 8.13 Representations and Warranties of the Trustee and the Fiscal
Agent.
(a) The Trustee hereby represents and warrants to the Master Servicer, for
its own benefit and the benefit of the Certificateholders, and to the Special
Servicer and the Depositor, as of the Closing Date, that:
(i) The Trustee is a national banking association duly organized, validly
existing and in good standing under the laws of the United States of America.
(ii) The execution and delivery of this Agreement by the Trustee, and the
performance and compliance with the terms of this Agreement by the Trustee, will
not violate the Trustee's organizational documents or constitute a default (or
an event which, with notice or lapse of time, or both, would constitute a
default) under, or result in the breach of, any material agreement or other
instrument to which it is a party or which is applicable to it or any of its
assets.
(iii) This Agreement, assuming due authorization, execution and delivery by
the Special Servicer, the Master Servicer, the Fiscal Agent and the Depositor,
constitutes a valid, legal and binding obligation of the Trustee, enforceable
against the Trustee in accordance with the terms hereof, subject to applicable
bankruptcy, insolvency, reorganization, moratorium and other laws
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affecting the enforcement of creditor's rights generally, and general principles
of equity, regardless of whether such enforcement is considered in a proceeding
in equity or at law.
(iv) The Trustee 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 governmental agency having jurisdiction, which default, in the Trustee's good
faith and reasonable judgment, is likely to affect materially and adversely the
ability of the Trustee to perform its obligations or the financial condition or
operations of the Trustee or its properties.
(v) No litigation is pending or, to the best of the Trustee's knowledge,
threatened against the Trustee which would prohibit the Trustee from entering
into this Agreement or, in the Trustee's good faith and reasonable judgment, is
likely to materially and adversely affect the ability of the Trustee to perform
its obligations under this Agreement.
(vi) No consent, approval, authorization or order of, registration or
filing with or notice to, any governmental authority or court is required, under
federal or state law, for the execution, delivery and performance of or
compliance by the Trustee with this Agreement, or the consummation by the
Trustee of any transaction contemplated hereby, other than (1) such consents,
approvals, authorization, qualifications, registrations, filings or notices as
have been obtained or made and (2) where the lack of such consent, approval,
authorization, qualification, registration, filing or notice would not have a
material adverse effect on performance by the Trustee under this Agreement.
(b) The Fiscal Agent hereby represents and warrants to the Master Servicer,
for its own benefit and the benefit of the Certificateholders, and to the
Special Servicer and the Depositor, as of the Closing Date, that:
(i) The Fiscal Agent is an organization organized under the laws of the
Netherlands, duly organized, validly existing and in good standing under the
laws governing its creation and existence.
(ii) The execution and delivery of this Agreement by the Fiscal Agent, and
the performance and compliance with the terms of this Agreement by the Fiscal
Agent, will not violate the Fiscal Agent's organizational documents or
constitute a default (or an event which, with notice or lapse of time, or both,
would constitute a default) under, or result in the breach of, any material
agreement or other instrument to which it is a party or which is applicable to
it or any of its assets.
(iii) This Agreement, assuming due authorization, execution and delivery by
the Special Servicer, the Master Servicer, the Trustee and the Depositor,
constitutes a valid, legal and binding obligation of the Fiscal Agent,
enforceable against the Fiscal Agent in accordance with the terms hereof,
subject to applicable bankruptcy, insolvency, reorganization, moratorium and
other laws affecting the enforcement of creditors' rights generally, and general
principles of equity, regardless of whether such enforcement is considered in a
proceeding in equity or at law.
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(iv) The Fiscal Agent 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 governmental agency, which default, in the Fiscal Agent's good
faith and reasonable judgment, is likely to affect materially and adversely
either the ability of the Fiscal Agent to perform its obligations or the
financial conditions or operations of the Fiscal Agent or its properties.
(v) No litigation is pending or, to the best of the Fiscal Agent's
knowledge, threatened against the Fiscal Agent which would prohibit the Fiscal
Agent from entering into this Agreement or, in the Fiscal Agent's good faith and
reasonable judgment, is likely to materially and adversely affect the ability of
the Fiscal Agent to perform its obligations under this Agreement.
(vi) No consent, approval, authorization or order of, registration or
filing with or notice to, any governmental authority or court is required, under
federal or state law for the execution, delivery and performance of or
compliance by the Fiscal Agent with this Agreement, or the consummation by the
Fiscal Agent of any transaction contemplated hereby, other than (1) such
consents, approvals, authorizations qualifications, registrations, filings or
notices as have been obtained or made and (2) where the lack of such consent,
approval, authorization, qualification, registration, filing or notice would not
have a material adverse effect on the performance by the Fiscal Agent under this
Agreement.
SECTION 8.14 Filings with the Securities and Exchange Commission.
Based on information furnished to it by the Master Servicer and the
Depositor (in an 80 column unformatted electronic format acceptable to the
Trustee), the Trustee will prepare and file with the Securities and Exchange
Commission on Form 8-K (including XXXXX filings), on behalf of the Trust Fund
the Distribution Date Statement. The Trustee shall have no responsibility to
file any items other than those specified in this Section 8.14. Prior to January
2, 2000 (and each anniversary thereafter until directed by the Depositor to file
a Form 15, delisting the transaction) the Trustee shall hire counsel selected by
the Depositor to file Form 10- K's on behalf of the Trust Fund for the preceding
fiscal year. Any fees and expenses accrued and incurred by the Trustee in
connection with this Section 8.14 (including reasonable attorneys' fees) shall
be reimbursed to it by the Depositor. Prior to filing any such reports, the
Trustee shall submit reports to the Depositor for review and approval.
SECTION 8.15 Fiscal Agent Termination Event.
"Fiscal Agent Termination Event," wherever used herein, means any one of
the following events:
(i) Any failure by the Fiscal Agent to remit to the Trustee when due
any required Advances; or
(ii) A decree or order of a court or agency or supervisory authority
having jurisdiction in the premises in an involuntary case under any
present or future federal or state bankruptcy, insolvency or similar law
for the appointment of a conservator,
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receiver, liquidator, trustee or similar official in any bankruptcy,
insolvency, readjustment of debt, marshaling of assets and liabilities or
similar proceedings, or for the winding-up or liquidation of its affairs,
shall have been entered against the Fiscal Agent and such decree or order
shall have remained in force undischarged or unstayed for a period of 60
days; or
(iii) The Fiscal Agent shall consent to the appointment of a
conservator, receiver, liquidator, trustee or similar official in any
bankruptcy, insolvency, readjustment of debt, marshaling of assets and
liabilities or similar proceedings or relating to the Fiscal Agent or of or
relating to all or substantially all of its property; or
(iv) The Fiscal Agent shall admit in writing its inability to pay its
debts generally as they become due, file a petition to take advantage of
any applicable bankruptcy, insolvency or reorganization statute, make an
assignment for the benefit of its creditors, voluntarily suspend payment of
its obligations, or take any corporate action in furtherance of the
foregoing; or
(v) Any Rating Agency shall indicate its intent to reduce, qualify or
withdraw the outstanding rating of any Class of Certificates because the
prospective financial condition or capacity to make Advances of the Fiscal
Agent is insufficient to maintain such rating; or
(vi) The long-term unsecured debt of the Fiscal Agent is rated below
"AA" or "Aa2", as applicable, by any Rating Agency.
SECTION 8.16 Procedure Upon Termination Event.
On the date specified in a written notice of termination given to the
Fiscal Agent pursuant to Section 8.07, all authority, power and rights of the
Fiscal Agent under this Agreement, whether with respect to the Mortgage Loans or
otherwise, shall terminate and a successor Fiscal Agent shall be appointed by
the Trustee, with the consent of the Depositor; provided that in no event shall
the termination of the Fiscal Agent be effective until Rating Agency
Confirmation shall have been obtained with respect to a successor fiscal agent
from each of Xxxxx'x and FITCH IBCA. The Fiscal Agent agrees to cooperate with
the Trustee in effecting the termination of the Fiscal Agent's responsibilities
and rights hereunder as Fiscal Agent.
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ARTICLE IX
TERMINATION
SECTION 9.01 Termination Upon Repurchase or Liquidation of All Mortgage
Loans.
Subject to Section 9.02, the Trust Fund and the respective obligations and
responsibilities under this Agreement of the Depositor, the Master Servicer, the
Special Servicer, the Fiscal Agent and the Trustee (other than the obligations
of the Trustee to provide for and make payments to Certificateholders as
hereafter set forth) shall terminate upon payment (or provision for payment) to
the Certificateholders of all amounts held by or on behalf of the Trustee and
required hereunder to be so paid on the Distribution Date following the earlier
to occur of (i) the purchase by the Master Servicer or the Depositor of all
Mortgage Loans and each REO Property remaining in REMIC I at a price (to be
determined as of the end of the Collection Period for the anticipated Final
Distribution Date) equal to (A) the aggregate Purchase Price of all the Mortgage
Loans included in REMIC I, plus (B) the appraised value of each REO Property, if
any, included in REMIC I (such appraisal to be conducted by an Independent
MAI-designated appraiser selected by the Master Servicer and approved by the
Trustee), minus (C) solely in the case where the Master Servicer is effecting
such purchase, the aggregate amount of unreimbursed Advances, together with any
Advance Interest accrued and payable to the Master Servicer in respect of such
Advances and any unpaid Servicing Fees, remaining outstanding (which items shall
be deemed to have been paid or reimbursed to the Master Servicer in connection
with such purchase), and (ii) the final payment or other liquidation (or any
advance with respect thereto) of the last Mortgage Loan or REO Property
remaining in REMIC I; provided, however, that in no event shall the trust
created hereby continue beyond the expiration of 21 years from the death of the
last survivor of the descendants of Xxxxxx X. Xxxxxxx, the late ambassador of
the United States to the Court of St. Xxxxx, living on the date hereof.
The Master Servicer or the Depositor each may, at its option, elect to
purchase all of the Mortgage Loans and each REO Property remaining in the Trust
Fund as contemplated by clause (i) of the preceding paragraph by giving written
notice to the other parties hereto no later than 60 days prior to the
anticipated date of purchase; provided, however, that the Master Servicer or the
Depositor may so elect to purchase all of the Mortgage Loans and each REO
Property remaining in REMIC I only if the aggregate Stated Principal Balance of
the Mortgage Loans and any REO Loans remaining in the Trust Fund at the time of
such election is less than 1% of the aggregate Cut-off Date Principal Balance of
the Mortgage Loans set forth in the Preliminary Statement. Such option shall be
exercisable by each such Person in the priority in which such Person is listed
in the immediately foregoing sentence. In the event that the Master Servicer or
the Depositor purchases all of the Mortgage Loans and each REO Property
remaining in REMIC I in accordance with the preceding sentence, the Master
Servicer or the Depositor, as applicable, shall deposit in the Distribution
Account not later than the Master Servicer Remittance Date relating to the
Distribution Date on which the final distribution on the Certificates is to
occur, an amount in immediately available funds equal to the above-described
purchase price (exclusive of any portion thereof would
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be payable to any Person other than the Certificateholders pursuant to Section
3.05(a) if on deposit in the Certificate Account, which portion shall be
deposited in the Certificate Account). In addition, the Master Servicer shall
transfer to the Distribution Account all amounts required to be transferred
thereto on such Master Servicer Remittance Date from the Certificate Account
pursuant to the second paragraph of Section 3.04(b), together with any other
amounts on deposit in the Certificate Account that would otherwise be held for
future distribution. Upon confirmation that such final deposits have been made,
the Trustee shall release or cause to be released to the Master Servicer or the
Depositor, as applicable, the Mortgage Files for the remaining Mortgage Loans
and any Reserve Funds and Escrow Payments in any Reserve Accounts or Servicing
Account, as applicable, and shall execute all assignments, endorsements and
other instruments furnished to it by the Master Servicer or the Depositor, as
applicable, as shall be necessary to effectuate transfer of the Mortgage Loans
and REO Properties remaining in REMIC I. All Credit Files for the remaining
Mortgage Loans and REO Properties shall be delivered to the purchasing entity.
Notice of any termination shall be given promptly by the Trustee by letter
to Certificateholders and, if not previously notified pursuant to the preceding
paragraph, to the other parties hereto mailed (a) in the event such notice is
given in connection with the Master Servicer's or the Depositor's purchase of
all of the Mortgage Loans and each REO Property remaining in REMIC I, not
earlier than the 15th day and not later than the 25th day of the month next
preceding the month of the final distribution on the Certificates or (b)
otherwise during the month of such final distribution on or before the
Determination Date in such month, in each case specifying (i) the Distribution
Date upon which the Trust Fund will terminate and final payment of the
Certificates will be made, (ii) the amount of any such final payment and (iii)
that the Record Date otherwise applicable to such Distribution Date is not
applicable, payments being made only upon presentation and surrender of the
Certificates at the offices of the Certificate Registrar or such other location
therein designated.
Upon presentation and surrender of the Certificates by the
Certificateholders on the final Distribution Date, the Trustee shall distribute
to each Certificateholder so presenting and surrendering its Certificates such
Certificateholder's Percentage Interest of that portion of the amounts then on
deposit in the Distribution Account that are allocable to payments on the Class
to which the Certificates so presented and surrendered belong. Amounts on
deposit in the Distribution Account as of the final Distribution Date (exclusive
of any portion of such amounts payable or reimbursable to any Person pursuant to
clauses (ii)-(vii) of Section 3.05(b)) shall be allocated for the purposes, in
the amounts and in accordance with the priority set forth in Section 4.01. Any
funds not distributed on such Distribution Date shall be set aside and held
uninvested in trust for the benefit of Certificateholders not presenting and
surrendering their Certificates in the aforesaid manner, and shall be disposed
of in accordance with the last paragraph of Section 4.01(g).
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SECTION 9.02 Additional Termination Requirements.
(a) In the event the Master Servicer or the Depositor purchases all of the
Mortgage Loans and each REO Property remaining in REMIC I as provided in Section
9.01, the Trust Fund (and, accordingly, REMIC I, REMIC II and REMIC III) shall
be terminated in accordance with the following additional requirements, unless
the Master Servicer or the Depositor, as the case may be, obtains at its own
expense and delivers to the Trustee an Opinion of Counsel, addressed to the
Depositor, the Master Servicer and the Trustee, to the effect that the failure
of the Trust Fund to comply with the requirements of this Section 9.02 will not
(subject to Section 10.01(f)) result in the imposition of taxes on "prohibited
transactions" of REMIC I, REMIC II or REMIC III as defined in Section 860F of
the Code or cause REMIC I, REMIC II or REMIC III to fail to qualify as a REMIC
at any time that any Certificates are outstanding:
(i) the Trustee shall specify the first day in the 90-day liquidation
period in a statement attached to the final Tax Return for each of REMIC I,
REMIC II and REMIC III pursuant to Treasury regulation Section 1.860F-1 and
shall satisfy all requirements of a qualified liquidation under Section
860F of the Code and any regulations thereunder;
(ii) during such 90-day liquidation period and at or prior to the time
of making of the final payment on the Certificates, the Trustee shall sell
all of the assets of REMIC I to the Master Servicer or the Depositor, as
applicable, for cash; and
(iii) immediately following the making of the final payment on the
Certificates, the Trustee shall distribute or credit, or cause to be
distributed or credited, to the Holders of the related Class of Residual
Certificates all cash on hand in the related REMIC (other than cash
retained to meet claims), and REMIC I, REMIC II and REMIC III shall
terminate at that time.
(b) By their acceptance of Certificates, the Holders thereof hereby agree
to authorize the Trustee to adopt a plan of complete liquidation of REMIC I,
REMIC II and REMIC III, which authorization shall be binding upon all successor
Certificateholders.
ARTICLE X
ADDITIONAL REMIC PROVISIONS
SECTION 10.01 REMIC Administration.
(a) The Trustee shall make an election to treat each of REMIC I, REMIC II
and REMIC III as a REMIC under the Code and, if necessary, under applicable
state law. Such election will be made on Form 1066 or other appropriate federal
tax or information return (including Form 8811) or any appropriate state return
for the taxable year ending on the last day of the calendar year in which the
Certificates are issued. The REMIC I Regular Interests are hereby designated as
the
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"regular interests" (within the meaning of Section 860G(a)(1) of the Code), and
the Class R-I Certificates are hereby designated as the sole class of "residual
interests" (within the meaning of Section 860G(a)(2) of the Code), in REMIC I.
The REMIC II Regular Interests are hereby designated as the "regular interests"
(within the meaning of Section 860G(a)(1) of the Code), and the Class R-II
Certificates are hereby designated as the sole class of "residual interests"
(within the meaning of Section 860G(a)(2) of the Code), in REMIC II. The REMIC
III Regular Certificates are hereby designated as the "regular interests"
(within the meaning of Section 860G(a)(1) of the Code) and the Class R-III
Certificates will be the sole class of "residual interests" (within the meaning
of Section 860G(a)(2) of the Code), in REMIC III. The Master Servicer, the
Special Servicer and the Trustee shall not (to the extent within the control of
each) permit the creation of any "interests" (within the meaning of Section 860G
of the Code) in REMIC I, REMIC II or REMIC III other than the Certificates.
(b) The Closing Date is hereby designated as the "startup day" of each of
REMIC I, REMIC II and REMIC III within the meaning of Section 860G(a)(9) of the
Code.
(c) The Trustee, as agent for the tax matters person of each of REMIC I,
REMIC II and REMIC III, shall (i) act on behalf of the REMIC in relation to any
tax matter or controversy involving the Trust Fund and (ii) represent the Trust
Fund in any administrative or judicial proceeding relating to an examination or
audit by any governmental taxing authority with respect thereto. The legal
expenses, including without limitation attorneys' or accountants' fees, and
costs of any such proceeding and any liability resulting therefrom shall be
expenses of the Trust Fund and the Trustee shall be entitled to reimbursement
therefor out of amounts attributable to the Mortgage Loans and any REO
Properties on deposit in the Certificate Account as provided by Section 3.05(a)
unless such legal expenses and costs are incurred by reason of the Trustee's
willful misfeasance, bad faith or negligence. In the case of each of REMIC I,
REMIC II and REMIC III, the Holder of Residual Certificates representing the
largest Percentage Interest in the related Class thereof shall be designated, in
the manner provided under Treasury Regulations Section 1.860F-4(d) and temporary
Treasury Regulations Section 301.6231(a)(7)-1, as the tax matters person of such
REMIC. By its acceptance thereof, the Holder of Residual Certificates
representing the largest Percentage Interest in each Class thereof hereby agrees
to irrevocably appoint the Trustee as its agent to perform all of the duties of
the tax matters person for the related REMIC created hereunder.
(d) The Trustee shall prepare or cause to be prepared, sign and file, in a
timely manner, all of the Tax Returns that it determines are required with
respect to the Grantor Trust and each REMIC created hereunder. The expenses of
preparing such returns shall be borne by the Trustee without any right of
reimbursement therefor.
(e) The Trustee shall provide (i) to any Transferor of a Residual
Certificate such information as is necessary for the application of any tax
relating to the transfer of such Residual Certificate to any Person who is not a
Permitted Transferee as provided in Section 5.02(d)(iii), (ii) to the
Certificateholders such information or reports as are required by the Code or
the REMIC Provisions including reports relating to interest, original issue
discount and market discount or premium (using the Prepayment Assumption) and
(iii) to the Internal Revenue Service the name,
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title, address and telephone number of the person who will serve as the
representative of each of REMIC I, REMIC II and REMIC III.
(f) The Trustee shall take such actions and shall cause each REMIC created
hereunder to take such actions as are reasonably within the Trustee's control
and the scope of its duties more specifically set forth herein as shall be
necessary to maintain the status thereof as a REMIC under the REMIC Provisions.
The Trustee shall not knowingly or intentionally take any action, cause REMIC I,
REMIC II or REMIC III to take any action or fail to take (or fail to cause to be
taken) any action reasonably within its control and the scope of duties more
specifically set forth herein, that, under the REMIC Provisions, if taken or not
taken, as the case may be, could (i) adversely affect the status of REMIC I,
REMIC II or REMIC III as a REMIC or (ii) result (subject to the following
sentence) in the imposition of a tax upon REMIC I, REMIC II or REMIC III
(including but not limited to the tax on prohibited transactions as defined in
Section 860F(a)(2) of the Code and the tax on contributions to a REMIC set forth
in Section 860G(d) of the Code) (either such event, an "Adverse REMIC Event")
unless the Trustee receives an Opinion of Counsel (at the expense of the party
seeking to take such action or, if such party fails to pay such expense, and the
Trustee determines that taking such action is in the best interest of REMIC I,
REMIC II or REMIC III and the Certificateholders, at the expense of the Trust
Fund, but in no event at the expense of the Trustee) to the effect that the
contemplated action will not, with respect to any REMIC created hereunder
adversely affect such status or, unless the Master Servicer, the Trustee, or the
Special Servicer, as applicable (or other Person acceptable to the Trustee),
determine that the monetary exposure to REMIC I, REMIC II and REMIC III is not
material and in its or their sole discretion to indemnify, to the extent
reasonably acceptable to the Trustee, the Trust Fund against the imposition of
such tax. Wherever in this Agreement a contemplated action may not be taken
because the timing of such action might result in the imposition of a tax on the
Trust Fund, or may only be taken pursuant to an Opinion of Counsel that such
action would not impose a tax on the Trust Fund, such action may nonetheless be
taken provided that the indemnity given in the preceding sentence with respect
to any taxes that might be imposed on the Trust Fund has been given and that all
other preconditions to the taking of such action have been satisfied. The
Trustee shall not take or fail to take any action (whether or not authorized
hereunder) as to which the Master Servicer has advised it in writing that it has
received an Opinion of Counsel to the effect that an Adverse REMIC Event could
occur with respect to such action. In addition, prior to taking any action with
respect to the Trust Fund or its assets, or causing the Trust Fund to take any
action, which is not expressly permitted under the terms of this Agreement, each
of the parties hereto will consult with the Trustee or its designee, in writing,
with respect to whether such action could cause an Adverse REMIC Event to occur
with respect to REMIC I, REMIC II or REMIC III, and such party shall not take
any such action, or cause REMIC I, REMIC II or REMIC III to take any such
action, as to which the Trustee has advised it in writing that an Adverse REMIC
Event could occur. The Trustee may consult with counsel to make such written
advice, and the cost of same shall be borne by the party seeking to take the
action not expressly permitted by this Agreement. At all times as may be
required by the Code, the Trustee will to the extent within its control and the
scope of its duties as specifically set forth herein, maintain substantially all
of the assets of REMIC I as "qualified mortgages" as defined in Section
860G(a)(3) of the Code and "permitted investments" as defined in Section
860G(a)(5) of the Code.
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(g) In the event that any tax is imposed on "prohibited transactions" of
REMIC I, REMIC II or REMIC III as defined in Section 860F(a)(2) of the Code, on
"net income from foreclosure property" of REMIC I, REMIC II or REMIC III as
defined in Section 860G(c) of the Code, or on any contributions to REMIC I,
REMIC II or REMIC III after the Startup Day therefor pursuant to Section 860G(d)
of the Code, or any other tax is imposed by the Code or any applicable
provisions of state or local laws, such tax shall be charged (i) to the Trustee,
if such tax arises out of or results from a breach by the Trustee of any of its
obligations under this Agreement, (ii) to any other party hereto, if such tax
arises out of or results from a breach by such party of any of its obligations
under this Agreement, or (iii) otherwise (including, without limitation, in the
case of any tax permitted to be incurred pursuant to Section 3.17(a)) against
amounts on deposit in the Distribution Account as provided by Section 3.05(b).
(h) The Trustee shall, for federal income tax purposes, maintain books and
records with respect to each of REMIC I, REMIC II and REMIC III on a calendar
year and on an accrual basis or as otherwise may be required by the REMIC
Provisions.
(i) Following the Startup Day, the Trustee shall not accept any
contributions of assets to the Trust Fund unless the Trustee shall have received
an Opinion of Counsel (at the expense of the party seeking to make such
contribution) to the effect that the inclusion of such assets in the Trust Fund
will not cause REMIC I, REMIC II or REMIC III to fail to qualify as a REMIC at
any time that any Certificates are outstanding or subject such REMIC to any tax
under the REMIC Provisions or other applicable provisions of federal, state and
local law or ordinances.
(j) None of the Master Servicer, the Special Servicer or the Trustee shall
enter into any arrangement by which REMIC I, REMIC II or REMIC III will receive
a fee or other compensation for services nor (to the extent within its control)
permit REMIC I, REMIC II or REMIC III to receive any income from assets other
than "qualified mortgages" as defined in Section 860G(a)(3) of the Code or
"permitted investments" as defined in Section 860G(a)(5) of the Code.
(k) Within 30 days after the Closing Date, the Trustee shall prepare and
file with the Internal Revenue Service Form 8811, "Information Return for Real
Estate Mortgage Investment Conduits (REMIC) and Issuers of Collateralized Debt
Obligations" for each of REMIC I, REMIC II and REMIC III.
(l) None of the Trustee, the Fiscal Agent, the Master Servicer, or the
Special Servicer shall sell, dispose of or substitute for any of the Mortgage
Loans (except in connection with (i) the default, imminent default or
foreclosure of a Mortgage Loan, including but not limited to, the acquisition or
sale of a Mortgaged Property acquired by deed in lieu of foreclosure, (ii) the
bankruptcy of REMIC I, REMIC II or REMIC III, (iii) the termination of the Trust
Fund pursuant to Article IX of this Agreement or (iv) a purchase of Mortgage
Loans pursuant to or as contemplated by Section 2.03 or 3.18 of this Agreement)
or acquire any assets for the Trust Fund or sell or dispose of any investments
in the Certificate Account, the Distribution Account, or the REO Account for
gain, or accept any contributions to the Trust Fund after the Closing Date,
unless it has received an Opinion of Counsel that such sale, disposition,
substitution or acquisition will not (a) affect adversely the status of REMIC I,
REMIC II or REMIC III as a REMIC or, (b) subject to Section
169
10.01(f), cause REMIC I, REMIC II or REMIC III to be subject to a tax on
"prohibited transactions" or "contributions" pursuant to the REMIC Provisions.
SECTION 10.02 Depositor, Master Servicer, Special Servicer, Fiscal Agent,
Trustee to Cooperate.
(a) The Depositor shall provide or cause to be provided to the Trustee,
within ten days after the Closing Date, all information or data that the Trustee
reasonably determines to be relevant for tax purposes as to the valuations and
issue prices of the Certificates, including, without limitation, the price,
yield, prepayment assumption and projected cash flow of the Certificates.
(b) The Master Servicer, the Special Servicer, the Fiscal Agent and the
Depositor shall each furnish such reports, certifications and information, and
access to such books and records maintained thereby, as may relate to the
Certificates or the Trust Fund and as shall be reasonably requested by the
Trustee in order to enable it to perform its duties hereunder.
SECTION 10.03 Grantor Trust Administration.
(a) The Trustee shall treat the Grantor Trust, for tax return preparation
purposes, as a grantor trust under the Code and, if necessary, under applicable
state law and will file appropriate federal or state Tax Returns for each
taxable year ending on or after the last day of the calendar year in which the
Certificates are issued.
(b) The Trustee shall pay out of its own funds any and all routine tax
administration expenses of the Trust Fund incurred with respect to the Grantor
Trust (but not including any professional fees or expenses related to audits or
any administrative or judicial proceedings with respect to the Trust Fund that
involve the Internal Revenue Service or state tax authorities which
extraordinary expenses shall be payable or reimbursable to the Trustee from the
Trust Fund unless otherwise provided in Section 10.02(e) or 10.02(f)).
(c) The Trustee shall prepare, sign and file when due all of the Tax
Returns in respect of the Grantor Trust. The expenses of preparing and filing
such returns shall be borne by the Trustee without any right of reimbursement
therefor. The other parties hereto shall provide on a timely basis to the
Trustee or its designee such information with respect to the Grantor Trust as is
in its possession and reasonably requested by the Trustee to enable it to
perform its obligations under this Section 10.02. Without limiting the
generality of the foregoing, the Depositor, within ten days following the
Trustee's request therefor, shall provide in writing to the Trustee such
information as is reasonably requested by the Trustee for tax purposes, and the
Trustee's duty to perform its reporting and other tax compliance obligations
under this Section 10.02 shall be subject to the condition that it receives from
the Depositor such information possessed by the Depositor that is necessary to
permit the Trustee to perform such obligations.
(d) The Trustee shall perform on behalf of the Grantor Trust all reporting
and other tax compliance duties that are required in respect thereof under the
Code, the Grantor Trust
170
Provisions or other compliance guidance issued by the Internal Revenue Service
or any state or local taxing authority.
(e) The Trustee shall perform its duties hereunder so as to maintain the
status of the Grantor Trust as a grantor trust under the Grantor Trust
Provisions (and the Master Servicer and the Special Servicer shall assist the
Trustee to the extent reasonably requested by the Trustee and to the extent of
information within the Trustee's, the Master Servicer's or the Special
Servicer's possession or control). None of the Trustee, Master Servicer, the
Special Servicer shall knowingly take (or cause the Grantor Trust to take) any
action or fail to take (or fail to cause to be taken) any action that, under the
Grantor Trust Provisions, if taken or not taken, as the case may be, could
adversely affect the status of the Grantor Trust as a grantor trust under the
Grantor Trust Provisions (any such adverse effect on grantor trust status, an
"Adverse Grantor Trust Event"), unless the Trustee has obtained or received an
Opinion of Counsel (at the expense of the party requesting such action or at the
expense of the Trust Fund if the Trustee seeks to take such action or to refrain
from taking any action for the benefit of the Certificateholders) to the effect
that the contemplated action will not result in an Adverse Grantor Trust Event.
None of the other parties hereto shall take any action or fail to take any
action (whether or not authorized hereunder) as to which the Trustee has advised
it in writing that the Trustee has received or obtained an Opinion of Counsel to
the effect that an Adverse Grantor Trust Event could result from such action or
failure to act. In addition, prior to taking any action with respect to the
Grantor Trust, or causing the Trust Fund to take any action, that is not
expressly permitted under the terms of this Agreement, the Master Servicer and
the Special Servicer shall consult with the Trustee or its designee, in writing,
with respect to whether such action could cause an Adverse Grantor Trust Event
to occur. Neither the Master Servicer nor the Special Servicer shall have any
liability hereunder for any action taken by it in accordance with the written
instructions of the Trustee. The Trustee may consult with counsel to make such
written advice, and the cost of same shall be borne by the party seeking to take
the action not permitted by this Agreement, but in no event at the cost or
expense of the Trust Fund or the Trustee. Notwithstanding any provision of this
Agreement to the contrary, the Grantor Trust Assets shall not be subject to any
expenses, costs or other charges that are attributable to the assets or
activities of REMIC I, REMIC II or REMIC III.
(f) If any tax is imposed on the Grantor Trust, such tax, together with all
incidental costs and expenses (including, without limitation, penalties and
reasonable attorneys' fees) shall be charged to and paid by: (i) the Special
Servicer, if such tax arises out of or results from a breach by the Special
Servicer of any of its obligations under Article III or this Section 10.02; (ii)
the Master Servicer, if such tax arises out of or results from a breach by the
Master Servicer of any of its obligations under Article III or this Section
10.02; (iii) the Trustee, if such tax arises out of or results from a breach by
the Trustee of any of its obligations under Article IV, Article VIII or this
Section 10.02; or (iv) the portion of the Trust Fund constituting the Grantor
Trust in all other instances.
(g) The Trustee shall, for federal income tax purposes, maintain books and
records with respect to the Grantor Trust on a calendar year and on an accrual
basis.
171
ARTICLE XI
MISCELLANEOUS PROVISIONS
SECTION 11.01 Amendment.
(a) This Agreement may be amended from time to time by the parties hereto,
without the consent of any of the Certificateholders:
(i) to cure any ambiguity,
(ii) to correct or supplement any provisions herein or therein, which may
be inconsistent with any other provisions herein or therein or to correct any
error,
(iii) to modify, eliminate or add to any of its provisions to such extent
as shall be necessary or desirable to maintain the qualification of REMIC I,
REMIC II or REMIC III as a REMIC at all times that any Certificate is
outstanding or to avoid or minimize the risk of the imposition of any tax on
REMIC I, REMIC II or REMIC III pursuant to the Code that would be a claim
against the Trust Fund, provided that the Trustee has received an Opinion of
Counsel to the effect that (A) such action is necessary or desirable to maintain
such qualification or to avoid or minimize the risk of the imposition of any
such tax and (B) such action will not adversely affect in any material respect
the interests of any Certificateholder,
(iv) to change the timing and/or nature of deposits into the Certificate
Account or the Distribution Account or to change the name in which the
Certificate Account is maintained, provided that (A) the Delinquency Advance
Date or the Master Servicer Remittance Date shall in no event be later than the
related Distribution Date, (B) such change shall not, as evidenced by an Opinion
of Counsel, adversely affect in any material respect the interests of any
Certificateholder and (C) such change shall not result in the downgrade,
qualification or withdrawal of the then-current rating assigned to any Class of
Certificates, as evidenced by a letter from each Rating Agency to such effect,
(v) to modify, eliminate or add to the provisions of Section 5.02(d) or any
other provision hereof restricting transfer of the Residual Certificates by
virtue of their being the REMIC "residual interests," provided that such change
shall not, as evidenced by an Opinion of Counsel, cause either the Trust Fund or
any of the Certificateholders (other than the transferor) to be subject to a
federal tax caused by a transfer to a Person that is not a United States Person
and a Permitted Transferee, or
(vi) to modify, eliminate or add any provision to this Agreement to provide
for a book-entry registration system for the Private Certificates, or
172
(vii) to make any other provisions with respect to matters or questions
arising under this Agreement which shall not be materially inconsistent with the
provisions of this Agreement, provided that such action shall not, as evidenced
by an Opinion of Counsel, adversely affect in any material respect the interests
of any Certificateholder.
(b) This Agreement may also be amended from time to time by the parties
hereto with the consent of the Holders of Certificates evidencing in the
aggregate not less than 66 2/3% of the Percentage Interests of each Class of
Certificates affected thereby for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Agreement or
of modifying in any manner the rights of the Holders of Certificates of such
Class; provided, however, that no such amendment shall:
(i) reduce in any manner the amount of, or delay the timing of,
payments which are required to be distributed on any Certificate without
the consent of the Holder of such Certificate, or
(ii) reduce the aforesaid percentage of Certificates of any Class the
Holders of which are required to consent to any such amendment, in any such
case without the consent of the Holders of all Certificates of such Class
then outstanding; or
(iii) modify the definition of "Servicing Standard" without the
consent of the Holders of all Certificates then outstanding.
(c) Notwithstanding the foregoing, the Trustee will not be entitled to
consent to any amendment hereto without having first received an Opinion or
Opinions of Counsel to the effect that (i) such amendment is permitted pursuant
to the terms of this Agreement and (ii) such amendment or the exercise of any
power granted to the Master Servicer, the Special Servicer, the Depositor, the
Trustee or any other specified person in accordance with such amendment will not
result in the imposition of a tax on REMIC I, REMIC II or REMIC III pursuant to
the REMIC Provisions or cause REMIC I, REMIC II or REMIC III to fail to qualify
as a REMIC.
(d) Promptly after the execution of any such amendment, the Trustee shall
furnish a statement describing the amendment to each Certificateholder.
(e) It shall not be necessary for the consent of Certificateholders under
this Section 11.01 to approve the particular form of any proposed amendment, but
it shall be sufficient if such consent shall approve the substance thereof. The
manner of obtaining such consents and of evidencing the authorization of the
execution thereof by Certificateholders shall be subject to such reasonable
regulations as the Trustee may prescribe.
(f) The Trustee may but shall not be obligated to enter into any amendment
pursuant to this Section that affects its rights, duties and immunities under
this Agreement or otherwise.
173
(g) The cost of any Opinion of Counsel to be delivered pursuant to Section
11.01(a) or (c) shall be borne by the Person seeking the related amendment,
except that if the Master Servicer or the Trustee requests any amendment of this
Agreement in furtherance of the rights and interests of Certificateholders, the
cost of any Opinion of Counsel required in connection therewith pursuant to
Section 11.01(a) or (c) shall be payable out of the Certificate Account.
SECTION 11.02 Recordation of Agreement; Counterparts.
(a) To the extent permitted by applicable law, this Agreement is subject to
recordation in all appropriate public offices for real property records in all
the counties or other comparable jurisdictions in which any or all of the
properties subject to the Mortgages are situated, and in any other appropriate
public recording office or elsewhere, such recordation to be effected by the
Master Servicer at the expense of the Trust Fund on direction by the Trustee,
such direction to be given by the Trustee only upon the Trustee's receipt of an
Opinion of Counsel to be obtained by the party requesting such recordation (the
cost of which may be paid out of the Certificate Account) to the effect that
such recordation materially and beneficially affects the interests of the
Certificateholders.
(b) For the purpose of facilitating the recordation of this Agreement as
herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute but one and
the same instrument.
SECTION 11.03 Limitation on Rights of Certificateholders.
(a) The death or incapacity of any Certificateholder shall not operate to
terminate this Agreement or the Trust Fund, nor entitle such Certificateholder's
legal representatives or heirs to claim an accounting or to take any action or
proceeding in any court for a partition or winding up of the Trust Fund, nor
otherwise affect the rights, obligations and liabilities of the parties hereto
or any of them.
(b) No Certificateholder shall have any right to vote (except as expressly
provided for herein) or in any manner otherwise control the operation and
management of the Trust Fund, or the obligations of the parties hereto, nor
shall anything herein set forth, or contained in the terms of the Certificates,
be construed so as to constitute the Certificateholders from time to time as
partners or members of an association; nor shall any Certificateholder be under
any liability to any third party by reason of any action taken by the parties to
this Agreement pursuant to any provision hereof.
(c) No Certificateholder shall have any right by virtue of any provision of
this Agreement to institute any suit, action or proceeding in equity or at law
upon or under or with respect to this Agreement or any Mortgage Loan, unless,
with respect to any suit, action or proceeding upon or under or with respect to
this Agreement, such Holder previously shall have given to the Trustee a written
notice of default hereunder, and of the continuance thereof, as hereinbefore
provided, and unless also (except in the case of a default by the Trustee) the
Holders of Certificates of any Class evidencing not less than 25% of the related
Percentage Interests in such
174
Class shall have made written request upon the Trustee to institute such action,
suit or proceeding in its own name as Trustee hereunder and shall have offered
to the Trustee such reasonable indemnity as it may require against the costs,
expenses and liabilities to be incurred therein or thereby, and the Trustee, for
60 days after its receipt of such notice, request and offer of indemnity, shall
have neglected or refused to institute any such action, suit or proceeding. The
Trustee shall be under no obligation to exercise any of the trusts or powers
vested in it under this Section 11.03(c) or to institute, conduct or defend any
litigation hereunder or in relation hereto at the request, order or direction of
any of the Holders of Certificates unless such Holders have offered to the
Trustee reasonable security against the costs, expenses and liabilities which
may be incurred therein or hereby. It is understood and intended, and expressly
covenanted by each Certificateholder with every other Certificateholder and the
Trustee, that no one or more Holders of Certificates shall have any right in any
manner whatsoever by virtue of any provision of this Agreement to affect,
disturb or prejudice the rights of the Holders of any other of such
Certificates, or to obtain or seek to obtain priority over or preference to any
other such Holder, which priority or preference is not otherwise provided for
herein, or to enforce any right under this Agreement, except in the manner
herein provided and for the equal, ratable and common benefit of all
Certificateholders. For the protection and enforcement of the provisions of this
Section 11.03(c), each and every Certificateholder and the Trustee shall be
entitled to such relief as can be given either at law or in equity.
SECTION 11.04 GOVERNING LAW.
THIS AGREEMENT AND THE CERTIFICATES SHALL BE CONSTRUED IN ACCORDANCE WITH
THE INTERNAL LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO
BE PERFORMED IN SAID STATE, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
SECTION 11.05 Notices.
Any communications provided for or permitted hereunder shall be in writing
and, unless otherwise expressly provided herein, shall be deemed to have been
duly given if personally delivered at or mailed by registered mail, postage
prepaid (except for notices to the Trustee which shall be deemed to have been
duly given only when received), to: (i) in the case of the Depositor, 000
Xxxxxxx Xxxx, Xxxxxxx, Xxxxxxxxxxxx 00000, Attention: Structured Finance
Manager, telecopy number: (000) 000-0000; (ii) in the case of the Master
Servicer, 000 Xxxxxxx Xxxx, Xxxxxxx, Xxxxxxxxxxxx 00000, Attention: EVP
Servicing, telecopy number: (000) 000-0000 (with copies to General Counsel
(telecopy number: (000) 000-0000) and to the Master Servicing Manager, 000 Xxxxx
Xxxxxx, 00xx Xxxxx, Xxxxxxx, Xxxxxxxx 00000, telecopy number (312) 499- 5406));
(iii) in the case of the Trustee and the Fiscal Agent, the Corporate Trust
Office; (iv) in the case of the Special Servicer, 000 Xxxxxxxxxx Xxxxxx, Xxx
Xxxxxxxxx, Xxxxxxxxxx 00000, telecopy number (000) 000-0000, Attention: CMBS
Portfolio Manager (with a copy to General Counsel); (v) in the case of the
Rating Agencies, (A) Standard & Poor's Rating Services, 00 Xxxxxxxx, Xxx Xxxx,
Xxx Xxxx 00000, Attention: Commercial Mortgage Surveillance Manager, telecopy
number: (000) 000-0000 and (B) Xxxxx'x Investors Services, Inc., 00 Xxxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: CMBS
175
Rating and Monitoring, telecopy number: (000) 000-0000 and (C) FITCH IBCA, Inc.,
Xxx Xxxxx Xxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Commercial Mortgage
Surveillance Dept., telecopy number: (000) 000-0000; and (vi) in the case of the
Underwriters, (A) Xxxxxxx, Xxxxx & Co., 00 Xxxxx Xxxxxx, Xxx Xxxx, XX 00000,
Attention Xxxx Xxxxxxx telecopy number: (000) 000-0000 (B) Deutsche Bank
Securities Inc., 00 Xxxx 00xx Xxxxxx, Xxx Xxxx, XX 00000, Attention Xxxx Xxxxxx,
telecopy number: (212) 469- 4579 and (C) Xxxxxxxxx, Lufkin & Xxxxxxxx Securities
Corporation, 000 Xxxx Xxxxxx, Xxx Xxxx, XX 00000, Attention Xxxx Xxxxx telecopy
number: (000) 000-0000 or as to each such Person such other address as may
hereafter be furnished by such Person to the parties hereto in writing. Any
communication required or permitted to be delivered to a Certificateholder shall
be deemed to have been duly given when mailed first class, postage prepaid, to
the address of such Holder as shown in the Certificate Register. Any notice so
mailed within the time prescribed in this Agreement shall be conclusively
presumed to have been duly given, whether or not the Certificateholder receives
such notice.
SECTION 11.06 Severability of Provisions.
If any one or more of the covenants, agreements, provisions or terms of
this Agreement shall be for any reason whatsoever held invalid, then such
covenants, agreements, provisions or terms shall be deemed severable from the
remaining covenants, agreements, provisions or terms of this Agreement and shall
in no way affect the validity or enforceability of the other provisions of this
Agreement or of the Certificates or the rights of the Holders thereof.
SECTION 11.07 Grant of a Security Interest.
The Depositor intends that the conveyance of the Depositor's right, title
and interest in and to the Mortgage Loans pursuant to this Agreement shall
constitute a sale and not a pledge of security for a loan. If such conveyance is
deemed to be a pledge of security for a loan, however, the Depositor intends
that the rights and obligations of the parties to such loan shall be established
pursuant to the terms of this Agreement. The Depositor also intends and agrees
that, in such event, (i) the Depositor shall be deemed to have granted to the
Trustee (in such capacity) a first priority security interest in the Depositor's
entire right, title and interest in and to the assets comprising the Trust Fund,
including without limitation, the Mortgage Loans (including all Replacement
Mortgage Loans), all principal and interest received or receivable with respect
to the Mortgage Loans (other than principal and interest payments due and
payable prior to the Cut-off Date and Principal Prepayments received prior to
the Cut-off Date), all amounts held from time to time in the Certificate Account
and the Distribution Account and all reinvestment earnings on such amounts, and
all of the Depositor's right, title and interest in and to the proceeds of any
title, hazard or other Insurance Policies related to such Mortgage Loans, and
(ii) this Agreement shall constitute a security agreement under applicable law.
The Depositor shall file or cause to be filed, as a precautionary filing, a Form
UCC-1 substantially in the form attached as Exhibit E hereto in all appropriate
locations in the Commonwealth of Pennsylvania promptly following the initial
issuance of the Certificates, and the Master Servicer shall prepare and file at
each such office, and the Trustee shall execute, continuation statements
thereto, in each case within six months prior to the fifth anniversary of the
immediately preceding filing. The Depositor shall cooperate in a reasonable
manner with the
176
Trustee and the Master Servicer in preparing and filing such continuation
statements. This Section 11.07 shall constitute notice to the Trustee pursuant
to any of the requirements of the applicable Uniform Commercial Code.
SECTION 11.08 Successors and Assigns; Beneficiaries.
The provisions of this Agreement shall be binding upon and inure to the
benefit of the parties hereto, their respective successors and permitted assigns
and all such provisions shall inure to the benefit of the Certificateholders. No
other person, including, without limitation, any Mortgagor, shall be entitled to
any benefit or equitable right, remedy or claim under this Agreement.
SECTION 11.09 Article and Section Headings.
The article and section headings herein are for convenience of reference
only, and shall not limit or otherwise affect the meaning hereof.
SECTION 11.10 Notices to the Rating Agencies.
(a) The Trustee shall use reasonable efforts promptly to provide notice or
a copy of the listed item to each Rating Agency with respect to each of the
following of which it has actual knowledge:
(i) any material change or amendment to this Agreement;
(ii) the occurrence of any Event of Default that has not been cured;
(iii) the resignation, termination or merger (with an entity other than an
Affiliate) of the Master Servicer, the Special Servicer or the Trustee or the
Fiscal Agent;
(iv) any change in the location of the Distribution Account;
(v) a copy of the notice given pursuant to Section 2.03(a) and the
repurchase of Mortgage Loans by a Mortgage Loan Seller pursuant to Section 6 of
the Mortgage Loan Purchase Agreement; and
(vi) the final payment to any Class of Certificateholders.
(b) Each of the Master Servicer and the Special Servicer shall promptly
furnish to each Rating Agency copies of the following:
(i) each of its annual statements as to compliance described in Section
3.13; and
(ii) each of its annual independent public accountants' servicing reports
described in Section 3.14.
177
(c) To the extent it is not already required to do so under Section 4.02
hereof, the Trustee shall promptly furnish to each Rating Agency copies of each
report prepared and/or delivered by it pursuant to Section 4.02 hereof.
(d) Each of the Master Servicer, the Special Servicer and the Trustee shall
provide such additional information to each Rating Agency upon request is in its
possession or reasonably available to it.
178
IN WITNESS WHEREOF, the parties hereto have caused their names to be signed
hereto by their respective officers thereunto duly authorized, in each case as
of the day and year first above written.
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.,
Depositor
By: /s/ Xxxxx Xxxxxxx
----------------------------------------
Name: Xxxxx Xxxxxxx
Title: Vice President
GMAC COMMERCIAL MORTGAGE CORPORATION,
Master Servicer and Special Servicer
By: /s/ Xxxxx Xxxxxxx
----------------------------------------
Name: Xxxxx Xxxxxxx
Title: Vice President
LASALLE BANK NATIONAL ASSOCIATION,
Trustee
By: /s/ Xxxxxxx Xxxxx
----------------------------------------
Name: Xxxxxxx Xxxxx
Title: 1st Vice President
ABN AMRO BANK N.V.
By: /s/ Xxxxxx X. Xxxxxx
----------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Group Vice President
By: /s/ Xxxx X. Xxxxx
----------------------------------------
Name: Xxxx X. Xxxxx
Title: Vice President
X-0
XXXXX XX XXX XXXX )
) ss.
COUNTY OF NEW YORK )
On the ___ day of June, 1999, before me, a notary public in and for said
State, personally appeared XXXXX XXXXXXX known to me to be a Vice President of
GMAC COMMERCIAL MORTGAGE SECURITIES, INC., one of the corporations that executed
the within instrument, and also known to me to be the person who executed it on
behalf of such corporation, and acknowledged to me that such corporation
executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
______________________________
Notary Public
[Notarial Seal]
STATE OF NEW YORK )
) ss.
COUNTY OF NEW YORK )
On the___ day of June, 1999, before me, a notary public in and for said
State, personally appeared XXXXX XXXXXXX known to me to be a Vice President of
GMAC COMMERCIAL MORTGAGE CORPORATION, one of the corporations that executed the
within instrument, and also known to me to be the person who executed it on
behalf of such corporation, and acknowledged to me that such corporation
executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
______________________________
Notary Public
[Notarial Seal]
STATE OF ILLINOIS )
) ss.
COUNTY OF XXXX )
On the ___ day of June, 1999, before me, a notary public in and for said
State, personally appeared ________________________________________ known to me
to be a _________________________________________ of LASALLE BANK NATIONAL
ASSOCIATION, a national chartered bank duly organized, validly existing and in
good standing under the United States of America that executed the within
instrument, and also known to me to be the person who executed it on behalf of
such nationally chartered bank, and acknowledged to me that such nationally
chartered bank executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
______________________________
Notary Public
[Notarial Seal]
STATE OF ILLINOIS )
) ss.
COUNTY OF XXXX )
On the ___ day of June, 1999, before me, a notary public in and for said
State, personally appeared ________________________________________ known to me
to be a _________________________________ of AMRO BANK N.V., an organization
organized under the laws of the Netherlands, that executed the within
instrument, and also known to me to be the person who executed it on behalf of
such organization and acknowledged tome that such organization executed the
within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
______________________________
Notary Public
[Notarial Seal]
TABLE OF CONTENTS
ARTICLE I DEFINITIONS.....................................................5
SECTION 1.01 Defined Terms...............................5
SECTION 1.02 Certain Calculations in Respect of the
Mortgage Pool..............................57
ARTICLE II CONVEYANCE OF MORTGAGE LOANS; ORIGINAL
ISSUANCE OF CERTIFICATES....................................58
SECTION 2.01 Establishment of Trust; Conveyance of
Mortgage Loans.............................58
SECTION 2.02 Acceptance by Trustee......................61
SECTION 2.03 Mortgage Loan Sellers' Repurchase of
Mortgage Loans for Defects in Mortgage
Files and Breaches of Representations
and Warranties.............................62
SECTION 2.04 Issuance of Class R-I Certificates;
Creation of REMIC I Regular Interests......65
SECTION 2.05 Conveyance of REMIC I Regular Interests;
Acceptance of REMIC II by the Trustee......65
SECTION 2.06 Issuance of Class R-II Certificates;
Creation of REMIC II Regular Interest......65
SECTION 2.07 Conveyance of REMIC II Regular Interests;
Acceptance of REMIC III by Trustee.........65
SECTION 2.08 Issuance of REMIC III Certificates.........66
ARTICLE III ADMINISTRATION AND SERVICING OF THE TRUST FUND.................66
SECTION 3.01 Servicing and Administration of the
Mortgage Loans.............................66
SECTION 3.02 Collection of Mortgage Loan Payments.......68
SECTION 3.03 Collection of Taxes, Assessments and
Similar Items; Servicing Accounts and
Reserve Accounts...........................68
SECTION 3.04 Certificate Account, Distribution Account
and Interest Reserve Account...............70
SECTION 3.05 Permitted Withdrawals From the
Certificate Account, the Distribution
Account and the Interest Reserve Account...73
SECTION 3.06 Investment of Funds in the
Certificate Account, the Distribution
Account, the Interest Reserve Account
and the REO Account........................77
SECTION 3.07 Maintenance of Insurance Policies;
Errors and Omissions
and Fidelity Coverage......................79
SECTION 3.08 Enforcement of Due-On-Sale
Clauses; Assumption
Agreements; Subordinate Financing;
Defeasance.................................82
SECTION 3.09 Realization Upon Defaulted Mortgage Loans..85
SECTION 3.10 Trustee to Cooperate; Release of
Mortgage Files.............................88
S-i
SECTION 3.11 Servicing Compensation; Nonrecoverable
Servicing Advances.........................89
SECTION 3.12 Inspections; Collection of
Financial Statements.......................93
SECTION 3.13 Annual Statement as to Compliance..........94
SECTION 3.14 Reports by Independent Public Accountants..94
SECTION 3.15 Access to Certain Information..............95
SECTION 3.16 Title to REO Property; REO Account.........95
SECTION 3.17 Management of REO Property; Independent
Contractors................................97
SECTION 3.18 Sale of Defaulted Mortgage Loans and
REO Properties.............................99
SECTION 3.19 Additional Obligations of the Master
Servicer and the Special Servicer.........102
SECTION 3.20 Modifications, Waivers, Amendments
and Consents..............................105
SECTION 3.21 Transfer of Servicing Between Master
Servicer and Special Servicer;
Record Keeping............................108
SECTION 3.22 Sub-Servicing Agreements..................109
SECTION 3.23 Designation of Special Servicer
by the Majority Certificateholder of the
Controlling Class.........................111
SECTION 3.24 Lock-Box Accounts and Servicing Accounts..111
SECTION 3.25 Representations and Warranties
of the Master Servicer and the
Special Servicer..........................112
ARTICLE IV PAYMENTS TO CERTIFICATEHOLDERS AND RELATED
MATTERS....................................................113
SECTION 4.01 Distributions.............................113
SECTION 4.02 Statements to Certificateholders;
Certain Reports by the
Master Servicer and the Special Servicer..122
SECTION 4.03 Delinquency Advances......................130
SECTION 4.04 Allocation of Realized Losses and
Additional Trust Fund Expenses............132
ARTICLE V THE CERTIFICATES..............................................133
SECTION 5.01 The Certificates..........................133
SECTION 5.02 Registration of Transfer and Exchange
of Certificates...........................134
SECTION 5.03 Book-Entry Certificates...................140
SECTION 5.04 Mutilated, Destroyed, Lost or
Stolen Certificates.......................141
SECTION 5.05 Persons Deemed Owners.....................141
ARTICLE VI THE DEPOSITOR, THE MASTER SERVICER AND THE
SPECIAL SERVICER...........................................142
SECTION 6.01 Liability of the Depositor, the Master
Servicer and the Special Servicer.........142
S-ii
SECTION 6.02 Merger, Consolidation or Conversion
of the Depositor, the Master Servicer
and the Special Servicer; Assignment
of Rights and Delegation of Duties by
the Master Servicer and the
Special Servicer..........................142
SECTION 6.03 Limitation on Liability of the
Depositor, the Master Servicer, the
Special Servicer and Others...............143
SECTION 6.04 Depositor, Master Servicer and Special
Servicer Not to Resign....................144
SECTION 6.05 Rights of the Depositor in Respect of the
Master Servicer and the Special
Servicer..................................144
ARTICLE VII DEFAULT.......................................................144
SECTION 7.01 Events of Default.........................144
SECTION 7.02 Trustee to Act; Appointment of Successor..147
SECTION 7.03 Notification to Certificateholders........148
SECTION 7.04 Waiver of Events of Default...............148
ARTICLE VIII CONCERNING THE TRUSTEE........................................149
SECTION 8.01 Duties of Trustee and Fiscal Agent........149
SECTION 8.02 Certain Matters Affecting the Trustee.....150
SECTION 8.03 Trustee and Fiscal Agent not
Liable for Validity or
Sufficiency of Certificates
or Mortgage Loans.........................151
SECTION 8.04 Trustee and the Fiscal Agent
May Own Certificates......................152
SECTION 8.05 Fees and Expenses of Trustee;
Indemnification of Trustee
and the Fiscal Agent......................152
SECTION 8.06 Eligibility Requirements for
Trustee and Fiscal Agent..................153
SECTION 8.07 Resignation and Removal of the Trustee
and the Fiscal Agent......................153
SECTION 8.08 Successor Trustee.........................155
SECTION 8.09 Merger or Consolidation of Trustee
and the Fiscal Agent......................155
SECTION 8.10 Appointment of Co-Trustee
or Separate Trustee.......................155
SECTION 8.11 Appointment of Custodians.................156
SECTION 8.12 Access to Certain Information.............157
SECTION 8.13 Representations and Warranties
of the Trustee............................158
SECTION 8.14 Filings with the Securities and
Exchange Commission.......................161
SECTION 8.15 Fiscal Agent Termination Event............161
SECTION 8.16 Procedure Upon Termination Event..........162
ARTICLE IX TERMINATION...................................................162
SECTION 9.01 Termination Upon Repurchase or
Liquidation of All Mortgage Loans.........162
S-iii
SECTION 9.02 Additional Termination Requirements.......164
ARTICLE X ADDITIONAL REMIC PROVISIONS...................................165
SECTION 10.01 REMIC Administration......................165
SECTION 10.02 Depositor, Master Servicer, Special
Servicer, Fiscal Agent, Trustee
to Cooperate..............................168
SECTION 10.03 Grantor Trust Administration..............168
ARTICLE XI MISCELLANEOUS PROVISIONS......................................170
SECTION 11.01 Amendment.................................170
SECTION 11.02 Recordation of Agreement; Counterparts....172
SECTION 11.03 Limitation on Rights of
Certificateholders........................172
SECTION 11.04 GOVERNING LAW.............................173
SECTION 11.05 Notices...................................174
SECTION 11.06 Severability of Provisions................174
SECTION 11.07 Grant of a Security Interest..............174
SECTION 11.08 Successors and Assigns; Beneficiaries.....175
SECTION 11.09 Article and Section Headings..............175
SECTION 11.10 Notices to the Rating Agencies............175
S-iv
INDEX
Page
----
Accrued Certificate Interest...................................................5
Acquisition Date...............................................................5
Additional Information.........................................................5
Additional Trust Fund Expense..................................................5
Adjustable Rate Mortgage Loan..................................................5
Advance ......................................................................5
Advance Interest...............................................................5
Adverse Grantor Trust Event....................................................5
Adverse REMIC Event............................................................6
Affiliate......................................................................6
Agreement......................................................................6
Anticipated Repayment Date.....................................................6
Applicable State Law...........................................................6
Appraisal......................................................................6
Appraisal Reduction Amount.....................................................6
Appraised Value................................................................7
ARD Loan ......................................................................7
Assignment of Leases...........................................................7
Assumed Monthly Payment........................................................7
Available Distribution Amount..................................................8
Balloon Mortgage Loan..........................................................8
Balloon Payment................................................................9
Balloon Payment Interest Excess................................................9
Balloon Payment Interest Shortfall.............................................9
Bankruptcy Code................................................................9
Bloomberg......................................................................9
Book-Entry Certificate.........................................................9
Breach ......................................................................9
Business Day...................................................................9
Cash Collateral Account.......................................................10
Cash Collateral Account Agreement.............................................10
CERCLA .....................................................................10
Certificate...................................................................10
Certificate Account...........................................................10
Certificate Factor............................................................10
Certificate Notional Amount...................................................11
Certificate Owner.............................................................11
Certificate Principal Balance.................................................11
Certificate Register" and "Certificate Registrar..............................11
S-v
Certificateholder" or "Holder.................................................10
Class ........................................................................11
Class A Certificate...........................................................11
Class A-1.....................................................................11
Class A-1 Certificate.........................................................11
Class A-2 Certificate.........................................................11
Class B Certificate...........................................................11
Class C Certificate...........................................................12
Class Certificate.............................................................15
Class D Certificate...........................................................12
Class E Certificate...........................................................12
Class F Certificate...........................................................12
Class G Certificate...........................................................12
Class H Certificate...........................................................12
Class Contribution Amount.....................................................15
Class J Certificate...........................................................12
Class K Certificate...........................................................12
Class K-1 Certificate.........................................................12
Class K-2 Certificate.........................................................12
Class LA-1 Component..........................................................12
Class LA-1 Component Rate.....................................................14
Class LA-2 Component..........................................................13
Class LA-2 Component Rate.....................................................14
Class LB Component............................................................13
Class LB Component Rate.......................................................14
Class LC Component............................................................13
Class LC Component Rate.......................................................14
Class LD Component............................................................13
Class LD Component Rate.......................................................14
Class LE Component............................................................13
Class LE Component Rate.......................................................14
Class LF Component............................................................13
Class LG Component............................................................13
Class LG Component Rate.......................................................14
Class LH Component............................................................13
Class LH Component Rate.......................................................15
Class LJ Component............................................................14
Class LJ Component Rate.......................................................15
Class LK Component............................................................14
Class LK Component Rate.......................................................15
Class Notional Amount.........................................................15
S-vi
Class Principal Balance.......................................................15
Class R-I Certificate.........................................................15
Class R-I Distribution Amount.................................................15
Class R-II Certificate........................................................15
Class R-III Distribution Amount...............................................16
Class X Certificate...........................................................16
Class X Component.............................................................16
Closing Date..................................................................16
Code .........................................................................16
Collection Period.............................................................16
Collection Report.............................................................16
Commission....................................................................16
Compensating Interest Payments................................................16
Component Rate................................................................16
Controlling Class.............................................................16
Corporate Trust Office........................................................17
Corrected Mortgage Loan.......................................................17
CPR ..........................................................................17
Credit File...................................................................17
Credit Lease..................................................................17
Credit Lease Loan.............................................................17
Cross-Collateralized Mortgage Loans...........................................17
CSSA Periodic Loan File.......................................................17
Current Principal Distribution Amount.........................................17
Custodian.....................................................................18
Cut-off Date..................................................................18
Cut-off Date Principal Balance................................................19
Debt Service Coverage Ratio...................................................19
Debt Service Reduction........................................................19
Default Interest..............................................................19
Defaulted Mortgage Loan.......................................................19
Defaulting Party..............................................................19
Defeasance Collateral.........................................................19
Defeasance Loan...............................................................19
Defeasance Option.............................................................19
Defect .......................................................................19
Deficient Valuation...........................................................20
Definitive Certificate........................................................20
Deleted Mortgage Loan.........................................................20
Delinquency Advance...........................................................20
Delinquency Advance Date......................................................20
S-vii
Delinquent Loan Status Report.................................................20
Depositor.....................................................................20
Depository....................................................................20
Depository Participant........................................................20
Determination Date............................................................20
Directly Operate..............................................................20
Discount Rate.................................................................21
Discount Rate Fraction........................................................21
Distribution Account..........................................................22
Distribution Date.............................................................22
Distribution Date Statement...................................................22
Due Date .....................................................................22
Eligible Account..............................................................22
Emergency Advance.............................................................22
Environmental Assessment......................................................22
ERISA .....................................................................22
Escrow Payment................................................................23
Event of Default..............................................................23
Excess Interest...............................................................23
Excess Rate...................................................................23
Exchange Act..................................................................23
Extraordinary Prepayment Interest Shortfall...................................23
FDIC .....................................................................23
FHLMC .....................................................................23
Final Distribution Date.......................................................23
Final Recovery Determination..................................................23
Fiscal Agent Termination Event...............................................161
Fixed Rate Mortgage Loan......................................................24
FNMA .....................................................................24
GMACCM .....................................................................24
Grantor Trust.................................................................24
Grantor Trust Assets..........................................................24
Grantor Trust Provisions......................................................24
Gross Margin..................................................................24
Ground Lease..................................................................25
Guarantor.....................................................................25
Guaranty .....................................................................25
Hazardous Materials...........................................................25
Historical Loan Modification Report...........................................25
Historical Loss Report........................................................25
Independent...................................................................25
S-viii
Independent Contractor........................................................26
Index ........................................................................26
Initial Balance...............................................................26
Initial Class Notional Amount.................................................26
Initial Class Principal Balance...............................................26
Insurance Policy..............................................................26
Insurance Proceeds............................................................26
Interest Accrual Period.......................................................27
Interest Rate Adjustment Date.................................................27
Interest Reserve Account......................................................27
Interest Reserve Loans........................................................27
Interested Person.............................................................27
Investment Account............................................................27
Investor Certification........................................................27
Issue Price...................................................................27
Late Collections..............................................................27
Late Due Date Mortgage Loan...................................................28
Liquidation Event.............................................................28
Liquidation Expenses..........................................................28
Liquidation Fee...............................................................28
Liquidation Fee Rate..........................................................28
Liquidation Proceeds..........................................................28
Loan-to-Value Ratio...........................................................29
Lock-Box Account..............................................................29
Lock-Box Agreement............................................................29
Loss Reimbursement Amount.....................................................29
MAI ..........................................................................29
Majority Certificateholder....................................................30
Master Servicer Remittance Date...............................................30
Master Servicing Fee..........................................................30
Master Servicing Fee Rate.....................................................30
Maturity Date.................................................................30
Modified Mortgage Loan........................................................30
Monthly Payment...............................................................31
Mortgage .....................................................................31
Mortgage File.................................................................31
Mortgage Loan.................................................................33
Mortgage Loan Purchase Agreement..............................................33
Mortgage Loan Schedule........................................................33
Mortgage Loan Seller..........................................................34
Mortgage Note.................................................................34
S-ix
Mortgage Pool.................................................................34
Mortgage Rate.................................................................34
Mortgaged Property............................................................35
Mortgagor.....................................................................35
Net Aggregate Prepayment Interest Shortfall...................................35
Net Investment Earnings.......................................................35
Net Investment Loss...........................................................35
Net Mortgage Rate.............................................................35
Net Operating Income..........................................................36
Non-Registered Certificate....................................................37
Nonrecoverable Advance........................................................36
Nonrecoverable Delinquency Advance............................................36
Nonrecoverable Servicing Advance..............................................36
Officer's Certificate.........................................................37
Opinion of Counsel............................................................37
OTS...........................................................................37
Ownership Interest............................................................37
Pass-Through Rate.............................................................37
Payment Adjustment Date.......................................................37
Payment Priority..............................................................38
Penalty Charges...............................................................38
Percentage Interest...........................................................38
Permitted Investments.........................................................38
Permitted Transferee..........................................................40
Person .......................................................................41
Plan .........................................................................41
Preliminary Statement.........................................................41
Prepayment Assumption.........................................................41
Prepayment Interest Excess....................................................41
Prepayment Interest Shortfall.................................................41
Prepayment Premium............................................................41
Primary Servicing Office......................................................41
Principal Allocation Fraction.................................................42
Principal Balance Certificate.................................................42
Principal Distribution Amount.................................................42
Principal Prepayment..........................................................42
Proposed Plan.................................................................42
Prospectus....................................................................42
PTCE 95-60....................................................................42
Purchase Price................................................................42
Qualified Appraiser...........................................................42
S-x
Qualified Insurer.............................................................43
Qualifying Substitute Mortgage Loan...........................................43
Rated Final Distribution Date.................................................43
Rating Agency.................................................................43
Rating Agency Confirmation....................................................44
Realized Loss.................................................................44
Record Date...................................................................44
Registered Certificates.......................................................45
Reimbursement Rate............................................................45
Related Borrower Group........................................................45
Release Date..................................................................45
REMIC ........................................................................45
REMIC I ......................................................................45
REMIC I Regular Interest......................................................45
REMIC I Remittance Rate.......................................................45
REMIC II .....................................................................46
REMIC II Distribution Amount..................................................46
REMIC II Regular Interest.....................................................46
REMIC II Remittance Rate......................................................47
REMIC III.....................................................................47
REMIC III Certificate.........................................................47
REMIC III Regular Certificate.................................................47
REMIC Provisions..............................................................47
Rents from Real Property......................................................47
REO Account...................................................................48
REO Acquisition...............................................................48
REO Disposition...............................................................48
REO Extension.................................................................48
REO Loan .....................................................................48
REO Property..................................................................49
REO Revenues..................................................................49
REO Status Report.............................................................49
REO Tax .....................................................................49
Replacement Mortgage Loan.....................................................49
Request for Release...........................................................49
Required Appraisal Loan.......................................................49
Reserve Account...............................................................49
Reserve Funds.................................................................49
Residual Certificate..........................................................49
Responsible Officer...........................................................49
Securities Act................................................................50
S-xi
Security Agreement............................................................50
Senior Certificate............................................................50
Servicer Watch List...........................................................50
Servicing Account.............................................................50
Servicing Advances............................................................50
Servicing Fee Rate............................................................51
Servicing Fees................................................................51
Servicing Officer.............................................................51
Servicing Return Date.........................................................51
Servicing Standard............................................................51
Servicing Transfer Event......................................................51
Special Servicer..............................................................51
Special Servicing Fee.........................................................51
Special Servicing Fee Rate....................................................51
Specially Serviced Mortgage Loan..........................................17, 51
Standard & Poor's.............................................................53
Startup Day...................................................................53
Stated Maturity Date..........................................................53
Stated Principal Balance......................................................53
Sub-Service...................................................................54
Sub-Servicing Agreement.......................................................54
Subordinated Certificate......................................................54
Substitution Shortfall Amount.................................................54
Supplemental Agreement........................................................54
Tax Returns...................................................................54
Tenant .......................................................................54
Transfer .....................................................................54
Transfer Affidavit and Agreement..............................................54
Transferee....................................................................55
Transferor....................................................................55
Trust Fund....................................................................55
Trustee ......................................................................55
Trustee Fee...................................................................55
Trustee Fee Rate..............................................................55
UCC ..........................................................................55
UCC Financing Statement.......................................................55
Uncertificated Accrued Interest...............................................55
Uncertificated Distributable Interest.........................................55
Uncertificated Principal Balance..............................................56
Underwriter...................................................................56
Uninsured Cause...............................................................56
S-xii
United States Person..........................................................56
USPAP ........................................................................56
Voting Rights.................................................................57
Weighted Average Net Mortgage Rate............................................57
Withheld Amount...............................................................57
Workout Fee...................................................................57
"Distributable Certificate Interest...........................................21
"FITCH IBCA...................................................................24
"Master Servicer..............................................................30
"Revised Rate.................................................................50
S-xiii
EXHIBITS
--------
Exhibit A-1 .................................Form of Class X CertificateA-1-1
Exhibit A-2 ...............................Form of Class A-1 CertificateA-2-1
Exhibit A-3 ...............................Form of Class A-2 CertificateA-3-1
Exhibit A-4 .................................Form of Class B CertificateA-4-1
Exhibit A-5 .................................Form of Class C CertificateA-5-1
Exhibit A-6 .................................Form of Class D CertificateA-6-1
Exhibit A-7 .................................Form of Class E CertificateA-7-1
Exhibit A-8 .................................Form of Class F CertificateA-8-1
Exhibit A-9 .................................Form of Class G CertificateA-9-1
Exhibit A-10 ................................Form of Class H CertificateA-10-1
Exhibit A-11 ................................Form of Class J CertificateA-11-1
Exhibit A-12 ................................Form of Class K CertificateA-12-1
Exhibit A-13 ................................Form of Class L CertificateA-13-1
Exhibit A-14 .................................Form of Class MCertificateA-14-1
Exhibit A-15 .................................Form of Class NCertificateA-15-1
Exhibit A-16 ..............................Form of Class R-I CertificateA-16-1
Exhibit A-17 .............................Form of Class R-II CertificateA-17-1
Exhibit A-18 ............................Form of Class R-III CertificateA-18-1
Exhibit B-1 ..............................Form of Transferor CertificateB-1-1
Exhibit B-2 ..............................Form of Transferee CertificateB-2-1
Exhibit B-3 ..............................Form of Transferee CertificateB-3-1
Exhibit C-1 ....................Form of Transfer Affidavit and AgreementC-1-1
Exhibit C-2 ..............................Form of Transferor CertificateC-2-1
Exhibit D ...................................Form of Request for ReleaseD-1
Exhibit E .............................Form of UCC-1 Financing StatementE-1
Exhibit F ................Methodology to Normalize Net Operating Income and
Debt Service CoverageF-1
Exhibit G ...........................Form of Distribution Date StatementG-1
Exhibit H ................................Form of Master Servicer ReportH-1
Exhibit I ...............................................Certain ReportsI-1
Exhibit J ...............................Form of CSSA Periodic Loan FileJ-1
Exhibit K ................................Form of Investor CertificationK-1
SCHEDULES
---------
Schedule I ...................................Mortgage Loan ScheduleSch. I-1
S-xiv
