Exhibit 99.3
MORTGAGE LOAN PURCHASE AGREEMENT
This Mortgage Loan Purchase Agreement (this "Agreement"), is
dated and effective as of December 18, 2001, between Salomon Brothers Realty
Corp. ("SBRC"), a New York corporation, as seller (in such capacity, together
with its successors and permitted assigns hereunder, the "Seller"), and Salomon
Brothers Mortgage Securities VII, Inc., a Delaware corporation ("SBMS VII"), as
purchaser (in such capacity, together with its successors and permitted assigns
hereunder, the "Purchaser").
RECITALS
SBRC desires to sell, assign, transfer and otherwise convey to
SBMS VII, without recourse, and SBMS VII desires to purchase, subject to the
terms and conditions set forth herein, the multifamily and commercial mortgage
loans (the "Mortgage Loans") identified on the schedule annexed hereto as
Exhibit A (the "Mortgage Loan Schedule"), as such schedule may be amended from
time to time pursuant to the terms hereof.
SBMS VII intends to create a trust (the "Trust"), the primary
assets of which will be the Mortgage Loans, certain other multifamily and
commercial mortgage loans (the "Other Loans"; and, together with the Mortgage
Loans, the "Securitized Loans"). Beneficial ownership of the assets of the Trust
(such assets collectively, the "Trust Fund") will be evidenced by a series of
mortgage pass-through certificates (the "Certificates"). Certain classes of the
Certificates will be rated by Standard & Poor's Ratings Services, a division of
The XxXxxx-Xxxx Companies, Inc. and Xxxxx'x Investors Service, Inc. (together,
the "Rating Agencies"). Certain classes of the Certificates (the "Registered
Certificates") will be subject to registration under the Securities Act of 1933,
as amended (the "Securities Act"). The Trust will be created and the
Certificates will be issued pursuant to a pooling and servicing agreement to be
dated as of December 1, 2001 (the "Pooling and Servicing Agreement"), among SBMS
VII, as depositor, Midland Loan Services, Inc., as master servicer ( in such
capacity, the "Master Servicer"), as general special servicer (in such capacity,
the "General Special Servicer") and as special servicer for the mortgage loans
identified therein as the "Birch Run Mortgage Loan Pair" (in such capacity, the
"Birch Run Special Servicer"), Xxxxx Fargo Bank Minnesota, N.A., as trustee (the
"Trustee"), JPMorgan Chase Bank as certificate administrator and as tax
administrator (in such capacities, the "Certificate Administrator" and the "Tax
Administrator"), Fortress CBO Investments I, Ltd. as the holder of the mortgage
note for the mortgage loan identified therein as the "Birch Run Companion
Mortgage Loan" (the "Birch Run Companion Mortgage Loan Noteholder") and Allied
Capital Corporation as the holder of the mortgage note for the mortgage loan
identified therein as the "MJ Ocala Hilton Companion Mortgage Loan" (the "MJ
Ocala Hilton Companion Mortgage Loan Noteholder"). Capitalized terms used but
not otherwise defined herein have the respective meanings assigned to them in
the Pooling and Servicing Agreement as in full force and effect on the Closing
Date (as defined in Section 1 hereof). It is anticipated that SBMS VII will
transfer the Mortgage Loans to the Trust contemporaneously with its purchase of
the Mortgage Loans hereunder.
The Depositor will acquire certain of the Other Loans from
Greenwich Capital Financial Products, Inc. ("GCFP"), certain of the Other Loans
from Artesia Mortgage Capital
Corporation ("AMCC") and the remaining Other Loan from Allied Capital
Corporation ("Allied"; and, together with GCFP and AMCC, the "Other Loan
Sellers").
SBMS VII intends to sell the Registered Certificates to
Xxxxxxx Xxxxx Xxxxxx Inc. ("SSBI"), Greenwich Capital Markets, Inc. ("Greenwich
Capital"), Credit Suisse First Boston Corporation ("CSFB"), X.X. Xxxxxx
Securities Inc. ("X.X. Xxxxxx") and First Union Securities, Inc. ("Wachovia
Securities" and, collectively in such capacity with Greenwich Capital, CSFB and
X.X. Xxxxxx, the "Underwriters"), pursuant to an underwriting agreement, dated
as of the date hereof (the "Underwriting Agreement"), between SBMS VII and the
Underwriters; and SBMS VII intends to sell the remaining Certificates (the
"Non-Registered Certificates") to SSBI, pursuant to a certificate purchase
agreement, dated as of the date hereof (the "Certificate Purchase Agreement"),
between SBMS VII and SSBI. The Registered Certificates are more fully described
in the prospectus dated December 10, 2001 (the "Basic Prospectus"); and the
supplement to the Basic Prospectus dated December 18, 2001 (the "Prospectus
Supplement"; and, together with the Basic Prospectus, the "Prospectus"), as each
may be amended or supplemented at any time hereafter. Certain classes of the
Non-Registered Certificates are more fully described in the private placement
memorandum dated December 18, 2001 (the "Memorandum"), as it may be amended or
supplemented at any time hereafter.
SBRC will indemnify SBMS VII, SSBI, Greenwich Capital, CSFB,
X.X. Xxxxxx, Wachovia Securities and certain related parties with respect to the
disclosure regarding the Mortgage Loans and SBRC contained in the Prospectus,
the Memorandum and certain other disclosure documents and offering materials
relating to the Certificates, pursuant to an indemnification agreement dated as
of December 18, 2001 (the "Indemnification Agreement"), among SBRC, SBMS VII,
SSBI, Greenwich Capital, CSFB, X.X. Xxxxxx and Wachovia Securities.
Now, therefore, in consideration of the premises and the
mutual agreements set forth herein, the parties agree as follows:
SECTION 1. Agreement to Purchase.
The Seller agrees to sell, assign, transfer and otherwise
convey (without recourse) to the Purchaser, and the Purchaser agrees to
purchase, subject to the terms and conditions set forth herein, the Mortgage
Loans. The purchase and sale of the Mortgage Loans shall take place on December
27, 2001, or such other date as shall be mutually acceptable to the parties
hereto (the "Closing Date"). As of the close of business on their respective due
dates in December 2001 (individually, on a loan-by-loan basis, and collectively,
the "Cut-off Date"), the Mortgage Loans will have an aggregate principal
balance, after application of all payments of principal due on the Mortgage
Loans on or before such date, whether or not received, of $278,215,054, subject
to a variance of plus or minus 5%. The purchase price for the Mortgage Loans
shall be as set forth in the price confirmation between the Seller and the
Purchaser, and will include accrued interest on the Mortgage Loans at their
respective Net Mortgage Rates from and including December 1, 2001 to but not
including the Closing Date, and shall be paid to the Seller by wire transfer in
immediately available funds on the Closing Date (or by such other method as
shall be mutually acceptable to the parties hereto).
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SECTION 2. Conveyance of the Mortgage Loans.
(a) Effective as of the Closing Date, subject only to its
receipt and acceptance of the purchase price referred to in Section 1 hereof,
the Seller does hereby transfer, assign, set over and otherwise convey to the
Purchaser, without recourse but subject to the terms of this Agreement, all the
right, title and interest of the Seller in and to the Mortgage Loans identified
on the Mortgage Loan Schedule as of such date, including, without limitation,
all of the Seller's right, title and interest in and to the proceeds of any
related title, hazard or other insurance policies received by the Seller on or
with respect to the Mortgage Loans after the Cut-off Date and any Additional
Collateral. The Seller shall, within 15 days of the discovery of an error on the
Mortgage Loan Schedule, amend the Mortgage Loan Schedule and deliver to the
Purchaser or its designee an amended Mortgage Loan Schedule. The Mortgage Loan
Schedule, as it may be amended, shall conform to the requirements set forth in
this Agreement.
(b) The Purchaser shall be entitled to receive all scheduled
payments of principal and interest due on the Mortgage Loans after the Cut-off
Date, and all other recoveries of principal and interest collected thereon after
the Cut-off Date (other than scheduled payments of principal and interest due on
the Mortgage Loans on or before the Cut-off Date and collected after the Cut-off
Date, which shall belong to the Seller).
(c) On or before the Closing Date, the Seller shall, at its
expense, deliver or cause to be delivered to the Purchaser or its designee: (i)
the Mortgage File and any Additional Collateral (other than reserve funds and
escrow payments) with respect to each Mortgage Loan; (ii) in the case of any
Mortgage Loan that has an original principal balance of $15,000,000 or more, and
whose Borrower is a single member limited liability company, an Opinion of
Counsel to the effect that such Borrower will not dissolve upon the bankruptcy,
dissolution, liquidation or death of the single member and that applicable law
provides that creditors of the single member may only attach assets of the
member, including membership interests in the Borrower, but not assets of the
Borrower; and (iii) in the case of any Mortgage Loan that has an original
principal balance of $20,000,000 or more, an Opinion of Counsel to the effect
that the related Borrower will not be consolidated in any insolvency proceeding
involving any other party. Unless the Purchaser notifies the Seller in writing
to the contrary, the designated recipient of the items described in the
preceding sentence shall be the Custodian.
If the Seller cannot deliver on the Closing Date any original
or certified recorded document or original policy of title insurance which is to
be delivered as part of the related Mortgage File, solely because the Seller is
delayed in making such delivery by reason of the fact that such original or
certified recorded document has not been returned by the appropriate recording
office or such original policy of title insurance has not yet been issued, then
the Seller shall notify the Purchaser, in writing, of such delay (unless the
Trustee shall have provided the Purchaser with an exception report indicating
such delay), and the Seller shall deliver such documents to the Purchaser or its
designee promptly upon the Seller's receipt thereof.
In addition, unless previously delivered by the Seller to the
Purchaser or its designee, the Seller shall, at its expense, deliver to and
deposit with, or cause to be delivered to and deposited with, the Purchaser or
its designee, the following items, within 10 days following the Closing Date
(or, if any of the following items are not in the actual possession of the
Seller,
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as soon as reasonably practical, but in any event within 30 days, after the
Closing Date): (i) copies of the Mortgage Files for the respective Mortgage
Loans; (ii) originals or copies of all financial statements, leases, rent rolls
and tenant estoppels in the possession or under the control of the Seller that
relate to the Mortgage Loans and, to the extent they are not required to be a
part of a Mortgage File in accordance with the definition thereof, originals or
copies of all documents, certificates and opinions in the possession or under
the control of the Seller that were delivered by or on behalf of the related
Borrowers in connection with the origination of the Mortgage Loans and that are
necessary for the ongoing servicing and administration of the Mortgage Loans;
and (iii) all unapplied reserve funds and escrow payments in the possession or
under the control of the Seller that relate to the Mortgage Loans, other than
those that are to be retained by a sub-servicer or primary servicer that will
continue to act on behalf of the Purchaser or its servicing agent. Unless the
Purchaser notifies the Seller in writing to the contrary, the designated
recipient of the items described in clauses (i) - (iii) of the preceding
sentence shall be the Master Servicer.
The Seller shall also provide to the Purchaser or its designee
the initial data on the Mortgage Loans (as of the Closing Date or the most
recent earlier date for which such date is available) contemplated by the Loan
Set-up File, the Loan Periodic Update File, the Operating Statement Analysis
Report and the Property File.
(d) The Seller shall be responsible for all reasonable costs
and expenses associated with recording and/or filing any and all assignments and
other instruments of transfer to the Purchaser with respect to the Mortgage
Loans that are required to be recorded or filed, as the case may be, under the
Pooling and Servicing Agreement, provided that the Seller shall not be
responsible for actually recording or filing any such assignments or other
instruments of transfer; and provided, further, that, in those instances where
the public recording office retains the original assignment of Mortgage or
assignment of Assignment of Leases, the Seller shall obtain or cause to be
obtained therefrom, and forward to the Purchaser or its designee, a certified
copy of the recorded original. If any such assignment or other instrument of
transfer is lost or returned unrecorded or unfiled, as the case may be, because
of a defect therein, and the Seller receives notice to such effect from the
Purchaser or its designee, then the Seller shall prepare or cause the
preparation of a substitute therefor or cure such defect, as the case may be.
The Seller shall provide the Purchaser or its designee with a power of attorney
to enable it or them to record any loan documents that the Purchaser has been
unable to record.
(e) Under generally accepted accounting principles ("GAAP"),
the Seller shall report its transfer of the Mortgage Loans to the Purchaser, as
provided herein, as a sale of those assets to the Purchaser in exchange for the
consideration specified in Section 1 hereof. In connection with the foregoing,
the Seller shall cause all of its records to reflect such transfer as a sale (as
opposed to a secured loan) and to reflect that the Mortgage Loans are no longer
property of the Seller.
(f) After the Seller's transfer of the Mortgage Loans to the
Purchaser, as provided herein, the Seller shall not take any action inconsistent
with the Purchaser's ownership of the Mortgage Loans. Except for actions that
are the express responsibility of another party hereunder or under the Pooling
and Servicing Agreement, and further except for actions that the Seller is
expressly permitted to complete subsequent to the Closing Date, the Seller
shall, on or
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before the Closing Date, take all actions reasonably required under applicable
law to effectuate the transfer of the Mortgage Loans by the Seller to the
Purchaser.
SECTION 3. Examination of Mortgage Loan Files and Due
Diligence Review.
The Seller shall reasonably cooperate with any examination of
the Mortgage Files for, and any other documents and records relating to, the
Mortgage Loans, that may be undertaken by or on behalf of the Purchaser. The
fact that the Purchaser has conducted or has failed to conduct any partial or
complete examination of any of the Mortgage Files for, and/or any of such other
documents and records relating to, the Mortgage Loans, shall not affect the
Purchaser's right to pursue any remedy available in equity or at law for a
breach of the Seller's representations and warranties made pursuant to Section
4, except as such remedies are otherwise limited by the terms of this Agreement.
SECTION 4. Representations, Warranties and Covenants of the
Seller.
(a) The Seller hereby makes, as of the Closing Date, to and
for the benefit of the Purchaser, each of the representations and warranties set
forth in Exhibit B.
(b) The Seller hereby makes, as of the Closing Date (or as of
such other date specifically provided in the particular representation or
warranty) to and for the benefit of the Purchaser, each of the representations
and warranties set forth in Exhibit C.
(c) It is understood and agreed that the representations and
warranties set forth in this Section 4 shall survive delivery of the respective
Mortgage Files to the Purchaser or its designee and shall inure to the benefit
of the Purchaser for so long as any of the Mortgage Loans remains outstanding,
notwithstanding any restrictive or qualified endorsement or assignment.
SECTION 4A. Representations, Warranties and Covenants of
Purchaser.
The Purchaser hereby represents and warrants, as of the
Closing Date, that:
(a) The Purchaser is a duly formed corporation, validly
existing and in good standing under the laws of the State of Delaware.
(b) The Purchaser has the full power and authority to enter
into and consummate all transactions contemplated by this Agreement, has duly
authorized the execution, delivery and performance of this Agreement, and has
duly executed and delivered this Agreement.
(c) This Agreement, assuming due authorization, execution and
delivery by the Seller, constitutes a valid, legal and binding obligation of the
Purchaser, enforceable against the Purchaser in accordance with the terms
hereof, subject to (i) applicable bankruptcy, insolvency, reorganization,
moratorium and other laws affecting the enforcement of creditors' rights
generally, and (ii) general principles of equity, regardless of whether such
enforcement is considered in a proceeding in equity or at law.
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(d) The execution and delivery of this Agreement by the
Purchaser, and the performance and compliance with the terms of this Agreement
by the Purchaser, will not violate the Purchaser's organizational documents or
constitute a default (or an event which, with notice or lapse of time, or both,
would constitute a default) under, or result in the breach of, any material
agreement or instrument to which it is a party or which is applicable to it or
any of its assets.
(e) The Purchaser is not in violation of, and its execution
and delivery of this Agreement and its performance and compliance with the terms
of this Agreement will not constitute a violation of, any law, any order or
decree of any court or arbiter, or any order, regulation or demand of any
federal, state or local governmental or regulatory authority, which violation,
in the Purchaser's good faith and reasonable judgment, is likely to affect
materially and adversely either the ability of the Purchaser to perform its
obligations under this Agreement or the financial condition of the Purchaser.
(f) No litigation is pending or, to the best of the
Purchaser's knowledge, threatened against the Purchaser which would prohibit the
Purchaser from entering into this Agreement or, in the Purchaser's good faith
and reasonable judgment, is likely to materially and adversely affect either the
ability of the Purchaser to perform its obligations under this Agreement or the
financial condition of the Seller.
(g) No consent, approval, authorization or order of, or filing
or registration with, any state or federal court or governmental agency or body
is required for the consummation by the Purchaser of the transactions
contemplated herein, except for those consents, approvals, authorizations and
orders that previously have been obtained and those filings and registrations
that previously have been completed.
SECTION 5. Notice of Breach; Cure, Repurchase and the Special
Reserve Account.
(a) If the Seller discovers or receives notice that there has
been a Material Breach or a Material Document Defect, then, not later than the
end of the applicable Initial Resolution Period, the Seller shall, subject to
subsection (b) below, (i) cure such Material Breach or Material Document Defect,
as the case may be, in all material respects or (ii) repurchase each affected
Mortgage Loan (each, a "Defective Mortgage Loan") at the related Purchase Price
provided for in the Pooling and Servicing Agreement, which Purchase Price shall
be deposited or delivered in accordance with the directions of the Purchaser;
provided that if (i) any such Material Breach or Material Document Defect, as
the case may be, does not impact whether the Defective Mortgage Loan was, is or
will continue to be, a "qualified mortgage" within the meaning of Section
860G(a)(3) of the Code (a "Qualified Mortgage"), (ii) such Material Breach or
Material Document Defect, as the case may be, is capable of being cured but not
within the applicable Initial Resolution Period, (iii) the Seller has commenced
and is diligently proceeding with the cure of such Material Breach or Material
Document Defect, as the case may be, within the applicable Initial Resolution
Period, and (iv) the Seller shall have delivered to the Purchaser a
certification executed on behalf of the Seller by an officer thereof setting
forth the reason that such Material Breach or Material Document Defect, as the
case may be, is not capable of being cured within the applicable Initial
Resolution Period and what actions the Seller is pursuing in
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connection with the cure thereof and stating that the Seller anticipates that
such Material Breach or Material Document Defect, as the case may be, will be
cured within an additional period equal to any applicable Resolution Extension
Period, then the Seller shall have an additional period equal to any applicable
Resolution Extension Period to complete such cure or, failing such, to
repurchase the Defective Mortgage Loan; and provided, further, that, on or after
June 30, 2003, if the Seller receives notice of a Material Document Defect with
respect to any Mortgage Loan, if such Material Document Defect constitutes a
Recording Omission, and if such Mortgage Loan is still subject to the Pooling
and Servicing Agreement and the Controlling Class Representative so consents in
its sole discretion, then the Seller may establish a Recording Omission Reserve
or a Recording Omission Credit as contemplated by Section 5(c) in lieu of
repurchasing such Mortgage Loan (but in no event later than such repurchase
would have to have been completed and without diminishing its cure/repurchase
obligations in respect of any other Material Document Defect or Material Breach
relating to such Mortgage Loan). Any such repurchase of a Defective Mortgage
Loan shall be on a whole loan, servicing released basis (subject to any right of
a Designated Sub-Servicer to continue to sub-service such Defective Mortgage
Loan as set forth in the related Designated Sub-Servicer Agreement). The Seller
shall have no obligation to monitor the Mortgage Loans regarding the existence
of a Material Breach or a Material Document Defect, but if the Seller has actual
knowledge of a Material Breach or Material Document Defect with respect to a
Mortgage Loan, it will notify the Purchaser.
If a Material Document Defect exists with respect to any
Mortgage Loan, if such Material Document Defect consists of the Seller's failure
to deliver any related Specially Designated Mortgage Loan Document on or before
the Closing Date, and if the Seller escrows with the Purchaser or its designee,
in accordance with the Pooling and Servicing Agreement as in full force and
effect on the Closing Date, within 15 days of the Closing Date, cash in the
amount of 25% of the Cut-off Date Principal Balance of such Mortgage Loan (such
cash amount, the "Purchase Price Security Deposit"), then the Initial Resolution
Period applicable to the remediation of such Material Document Defect shall be
extended until the 30th day following the Closing Date. Any Purchase Price
Security Deposit shall be maintained in an account substantially similar to the
Special Reserve Account (as defined below) and will be subject to investment at
the direction and for the benefit of the Seller in substantially the same
manner, and subject to substantially the same conditions, as funds in the
Special Reserve Account. The Seller may obtain a release of the Purchase Price
Security Deposit for any Mortgage Loan (net of any amounts payable therefrom
pursuant to the Pooling and Servicing Agreement as in full force and effect on
the Closing Date), together with any related investment income, upon such
Mortgage Loan's being paid in full or otherwise satisfied, liquidated or removed
from the Trust Fund or upon the subject Material Document Defect being remedied
in all material respects.
If one or more (but not all) of the Mortgage Loans
constituting a Cross-Collateralized Group are to be repurchased by the Seller as
contemplated by this Section 5(a), then, prior to the subject repurchase, at the
request of the Seller, the Purchaser or its designee shall use reasonable
efforts, subject to the terms of the related Mortgage Loans, to prepare and, to
the extent necessary and appropriate, have executed by the related Borrower and
record, such documentation as may be necessary to terminate the
cross-collateralization between the Mortgage Loans in such Cross-Collateralized
Group that are to be repurchased, on the one hand, and the remaining Mortgage
Loans therein, on the other hand, such that those two groups of Mortgage Loans
are each secured only by the Mortgaged Properties identified in the Mortgage
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Loan Schedule as directly corresponding thereto; provided that, if such
Cross-Collateralized Group is still subject to the Pooling and Servicing
Agreement, then no such termination shall be effected unless and until the
Seller has delivered or caused to be delivered to the Purchaser and its
designees: (i) an Opinion of Counsel to the effect that such termination will
not cause an Adverse REMIC Event to occur with respect to any REMIC Pool or an
Adverse Grantor Trust Event with respect to either Grantor Trust Pool, (ii)
written confirmation from each Rating Agency that such termination will not
cause an Adverse Rating Event to occur with respect to any Class of Rated
Certificates and (iii) written consent to such termination from the Controlling
Class Representative, which consent may be granted or withheld in its sole
discretion; and provided, further, that the Seller may, at its option, purchase
the entire subject Cross-Collateralized Group in lieu of terminating the
cross-collateralization. All costs and expenses incurred by the Purchaser or its
designees, pursuant to this paragraph shall be included in the calculation of
Purchase Price for the Mortgage Loan(s) to be repurchased. If the
cross-collateralization of any Cross-Collateralized Group cannot be terminated
as contemplated by this paragraph, then, for purposes of (i) determining whether
any Breach or Document Defect is a Material Breach or Material Document Defect,
as the case may be, and (ii) the application of remedies, such
Cross-Collateralized Group shall be treated as a single Mortgage Loan.
If any Defective Mortgage Loan is to be repurchased as
contemplated by this Section 5(a), the Seller shall amend the Mortgage Loan
Schedule to reflect the removal of the Defective Mortgage Loan and shall forward
such amended schedule to the Purchaser.
Except with respect to Breaches related to requirements that
Mortgage Loan Documents provide for the Borrower to pay certain costs, it is
understood and agreed that the obligations of the Seller set forth in this
Section 5(a) to cure a Material Breach or a Material Document Defect or
repurchase the related Defective Mortgage Loan(s), constitute the sole remedies
available to the Purchaser with respect to a Breach or Document Defect. With
respect to Breaches related to the provisions of Mortgage Loan Documents
requiring that the related Borrower bear the costs and expenses associated with
any particular action or matter under such Mortgage Loan Document(s), then the
Seller shall within 90 days of the Seller's receipt of written direction from
the Purchaser or its servicing agent, pay the amount of any such costs and
expenses borne by the Trust that are the basis of such Breach. Upon its making
such payments, the Seller shall be deemed to have cured such Breach in all
respects. Provided such payment is made in full, this paragraph describes the
sole remedy available to the Certificateholders and the Trustee on their behalf
regarding any such Breach, regardless of whether it constitutes a Material
Breach, and the Seller shall not be obligated to repurchase the Subject Mortgage
Loan on account of such Breach or otherwise cure such Breach.
If any REO Property in respect of any Mortgage Loan is subject
to the Pooling and Servicing Agreement, and if there exists with respect to such
REO Property any alleged Material Breach or Material Document Defect, then the
Seller shall be notified promptly and in writing by the applicable Special
Servicer of any offer that it receives to purchase such REO Property. Upon the
receipt of such notice by the Seller, the Seller shall then have the right to
repurchase such REO Property from the Trust at a purchase price equal to the
amount of such offer. The Seller shall have three (3) Business Days to purchase
such REO Property from the date that it was notified of such offer. The
applicable Special Servicer shall be obligated to provide the Seller with any
appraisal or other third-party reports relating to such REO Property
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within its possession to enable the related Mortgage Loan Seller to evaluate
such REO Property. Any sale of a Mortgage Loan, or foreclosure upon such
Mortgage Loan and sale of any related REO Property, to a Person other than the
Seller shall be (i) without recourse of any kind (either expressed or implied)
by such Person against the Seller and (ii) without representation or warranty of
any kind (either expressed or implied) by the Seller to or for the benefit of
such Person.
The fact that a Material Document Defect or Material Breach is
not discovered until after foreclosure (but in all instances prior to the sale
of the subject Mortgage Loan or REO Property) shall not prejudice any claim of
the Trust against the Seller for repurchase of the subject Mortgage Loan or REO
Property. The provisions of this Section 5 regarding remedies against the Seller
for a Material Breach or Material Document Defect with respect to any Mortgage
Loan shall also apply to the related REO Property.
Notwithstanding the Seller's failure to correct or cure the
Material Document Defect or Material Breach or purchase the subject REO
Property, the provisions above regarding notice of offers related to such REO
Property and the Seller's right to purchase such REO Property shall apply. If a
court of competent jurisdiction issues a final order that the Seller is or was
obligated to repurchase the related Mortgage Loan or REO Property or the Seller
otherwise accepts liability, then, after the expiration of any applicable appeal
period, but in no event later than the termination of the Trust pursuant to the
Pooling and Servicing Agreement, the Seller will be obligated to pay to the
Trust the amount, if any, by which the applicable Purchase Price exceeds any
Liquidation Proceeds received upon such liquidation (including those arising
from any sale to the Seller); provided that the prevailing party in such action
shall be entitled to recover all costs, fees and expenses (including reasonable
attorneys' fees) related thereto.
(b) It shall be a condition to any repurchase of a Defective
Mortgage Loan by the Seller pursuant to Section 5(a) that (i) the Purchaser
shall have executed and delivered such instruments of transfer or assignment
then presented to it by the Seller, in each case without recourse, as shall be
necessary to vest in the Seller the legal and beneficial ownership of such
Defective Mortgage Loan (including any property acquired in respect thereof or
proceeds of any insurance policy with respect thereto), to the extent that such
ownership interest was transferred to the Purchaser hereunder and (ii) the
Purchaser or its assignee shall release or cause the release to the Seller or
its designee of the Mortgage File, any Additional Collateral, all insurance
policies and proceeds thereunder, the Servicing File and any Escrow Payments
and/or Reserve Funds held by or on behalf of the Purchaser (or its assignee)
with respect to such Mortgage Loan.
(c) If, on or after June 30, 2003, the Seller receives notice
of a Material Document Defect with respect to any Mortgage Loan, which Material
Document Defect constitutes a Recording Omission, then the Seller may, with the
consent of the Purchaser or its designees, which consent may be granted or
withheld in its sole discretion, in lieu of repurchasing such Mortgage Loan (as
and to the extent contemplated by Section 5(a)), but in no event later than such
repurchase would have to have been completed, establish a Recording Omission
Credit or a Recording Omission Reserve with the Master Servicer in accordance
with the Pooling and Servicing Agreement. In furtherance of the preceding
sentence, the Purchaser or its designee shall establish one or more accounts
(individually and collectively, the "Special Reserve Account"), each of which
shall be an Eligible Account, and the Purchaser or its designee
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shall deposit any Recording Omission Reserve into the Special Reserve Account
within one Business Day of receipt. The Seller may direct the Purchaser to
invest or cause the investment of the funds deposited in the Special Reserve
Account in one or more Permitted Investments that bear interest or are sold at a
discount and that mature, unless payable on demand, no later than the Business
Day prior to the next Master Servicer Remittance Date. The Purchaser shall act
upon the written instructions of the Seller with respect to the investment of
funds in the Special Reserve Account in such Permitted Investments, provided
that in the absence of appropriate written instructions from the Seller, the
Purchaser shall have no obligation to invest or direct the investment of funds
in such Special Reserve Account. All income and gain realized from the
investment of funds deposited in such Special Reserve Account shall be for the
benefit of the Seller and shall be withdrawn by the Purchaser or its designee
and remitted to the Seller on each Master Servicer Remittance Date (net of any
losses incurred), and the Seller shall remit to the Purchaser from the Seller's
own funds for deposit into such Special Reserve Account the amount of any
realized losses (net of realized gains) in respect of such Permitted Investments
immediately upon realization of such net losses and receipt of written notice
thereof from the Purchaser; provided that the Seller shall not be required to
make any such deposit for any realized loss which is incurred solely as a result
of the insolvency of the federal or state depository institution or trust
company that holds such Special Reserve Account. Neither the Purchaser nor any
of its designees shall have any responsibility or liability with respect to the
investment directions of the Seller, the investment of funds in the Special
Reserve Account in Permitted Investments or any losses resulting therefrom. A
Recording Omission Credit shall (i) entitle the Purchaser or its designee to
draw upon the Recording Omission Credit on behalf of the Purchaser upon
presentation of only a sight draft or other written demand for payment, (ii)
permit multiple draws by the Purchaser or its designee, and (iii) be issued by
such issuer and containing such other terms as the Purchaser or its designee may
reasonably require to make such Recording Omission Credit reasonably equivalent
security to a Recording Omission Reserve in the same amount. Once a Recording
Omission Reserve or Recording Omission Credit is established with respect to any
Mortgage Loan, the Purchaser or its designee shall, from time to time, withdraw
funds from the related Special Reserve Account or draw upon the related
Recording Omission Credit, as the case may be, and apply the proceeds thereof to
pay the losses or expenses directly incurred by the Purchaser or its designee as
a result of a Recording Omission. The Recording Omission Reserve or Recording
Omission Credit or any unused balance thereof with respect to each Mortgage Loan
will be released to the Seller by the Purchaser upon the earlier of the Seller's
cure of all Recording Omissions with respect to such Mortgage Loan (provided
that the Purchaser has been reimbursed with respect to all losses and expenses
relating to Recording Omissions with respect to such Mortgage Loan) or such
Mortgage Loan no longer being a part of the Trust Fund under the Pooling and
Servicing Agreement.
SECTION 6. Closing.
(a) The closing of the sale of the Mortgage Loans (the
"Closing") shall be held at the offices of Sidley Xxxxxx Xxxxx & Xxxx, 000 Xxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 at 10:00 a.m., New York City time, on the
Closing Date.
(b) The Closing shall be subject to each of the following
conditions:
10
(i) All of the representations and warranties of the
Seller made pursuant to Section 4 of this Agreement shall be
true and correct in all material respects as of the Closing
Date or such other date as specified in Exhibit C;
(ii) All documents specified in Section 7 of this
Agreement (the "Closing Documents"), in such forms as are
reasonably acceptable to the Purchaser and, in the case of the
Pooling and Servicing Agreement (insofar as it affects the
obligations of the Seller hereunder), to the Seller, shall be
duly executed and delivered by all signatories as required
pursuant to the respective terms thereof;
(iii) The Seller shall have delivered and released to
the Purchaser or its designee, all documents and funds
required to be so delivered pursuant to Section 2 of this
Agreement;
(iv) All other terms and conditions of this Agreement
required to be complied with by the Seller and the Purchaser,
including, without limitation, in the case of the Purchaser,
payment of the purchase price, on or before the Closing Date
shall have been complied with, and the Seller shall have the
ability to comply with all terms and conditions and perform
all duties and obligations required to be complied with or
performed after the Closing Date;
(v) The Seller shall have paid all fees, costs and
expenses payable by it to the Purchaser or otherwise pursuant
to this Agreement; and
(vi) Neither the Underwriting Agreement nor the
Certificate Purchase Agreement shall have been terminated in
accordance with its terms.
(c) Both parties agree to use their best efforts to perform
their respective obligations hereunder in a manner that will enable the
Purchaser to purchase the Mortgage Loans on the Closing Date.
SECTION 7. Closing Documents.
The Closing Documents shall consist of the following:
(a) this Agreement duly executed and delivered by the
Purchaser and the Seller;
(b) the Indemnification Agreement duly executed and delivered
by the Seller, the Purchaser and each of SSBI, Greenwich Capital, CSFB, X.X.
Xxxxxx and Wachovia Securities.
(c) the Pooling and Servicing Agreement duly executed and
delivered by SBMS VII, the Master Servicer, the Special Servicer and the
Trustee;
(d) an Officer's Certificate substantially in the form of
Exhibit D-1 hereto, executed by the Secretary or an assistant secretary of the
Seller, in his or her individual capacity, and dated the Closing Date, and upon
which the Purchaser, SSBI, Greenwich Capital, CSFB, J.P.
11
Xxxxxx, Wachovia Securities and the Rating Agencies (collectively, the
"Interested Parties") may rely, attaching thereto as exhibits the organizational
documents of the Seller, as in full force and effect on the date hereof, and the
Resolutions described in clause (g) below;
(e) a certificate of good standing with respect to the Seller
issued by the Secretary of State of the State of New York dated not earlier than
10 days prior to the Closing Date;
(f) a certificate of the Seller substantially in the form of
Exhibit D-2 hereto, executed by an executive officer or authorized signatory of
the Seller and dated the Closing Date, and upon which the Interested Parties may
rely;
(g) resolutions of the Seller authorizing the transactions
contemplated by this Agreement, which resolutions will be in full force and
effect, and will not have been rescinded, as of the Closing Date;
(h) a written opinion of counsel for the Seller, which may be
delivered by in-house counsel, substantially in the form of Exhibit D-3A hereto
(with any modifications required by any Rating Agency, and subject to such
reasonable assumptions, qualifications and limitations as may be requested by
counsel for the Seller and acceptable to counsel for the Purchaser), dated the
Closing Date and addressed to the Purchaser, each of the other parties to the
Pooling and Servicing Agreement and each of the other Interested Parties;
(i) a written opinion of Sidley Xxxxxx Xxxxx & Xxxx, as
special counsel for the Seller, substantially in the form of Exhibit D-3B hereto
(with any modifications required by any Rating Agency, and subject to such
reasonable assumptions, qualifications and limitations as may be requested by
counsel for the Seller and acceptable to counsel for the Purchaser), dated the
Closing Date and addressed to the Purchaser, each of the other parties to the
Pooling and Servicing Agreement and each of the other Interested Parties;
(j) such other written opinions as may be required by either
Rating Agency (including, without limitation, a favorable opinion as to the
"true sale" characterization of the transfer of the Mortgage Loans contemplated
by this Agreement);
(k) a written letter of Sidley Xxxxxx Xxxxx & Xxxx, as special
counsel to the Seller, substantially in the Form of Exhibit D-3C, relating to
the disclosure in the Prospectus regarding the Mortgage Loans and SBRC, dated
the Closing Date and addressed to the Purchaser and each of the other Interested
Parties (except for the Rating Agencies); and
(l) one or more accountants' comfort letters, addressed, and
in form and substance reasonably acceptable, to SSBI, Greenwich Capital, CSFB,
X.X. Xxxxxx and Wachovia Securities, relating to the information regarding the
Mortgage Loans contained in the Prospectus and Memorandum that is of a
statistical nature;
SECTION 8. Costs.
Any costs and expenses incurred by either party hereto in
connection with the transactions contemplated hereunder shall be borne by the
parties in accordance with the terms of
12
that certain Term Sheet, dated September 21, 2001 (the "Term Sheet"), between
SSBI, Greenwich Capital, AMCC and Artesia Banking Corp.
SECTION 9. Notices.
All demands, notices and communications hereunder shall be in
writing and shall be deemed to have been duly given if personally delivered to
or mailed, by registered mail, postage prepaid, by overnight mail or courier
service, or transmitted by facsimile and confirmed by a similar mailed writing,
if to the Purchaser, addressed to the Purchaser at 000 Xxxxxxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, attention: Xxxxxx Xxxxx, facsimile no.: 000-000-0000, or
to such other address or facsimile number as may hereafter be furnished to the
Seller in writing by the Purchaser; and, if to the Seller, addressed to the
Seller at 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, attention: Xxxxxx
Xxxxx, facsimile no.: 000-000-0000, or to such other address or facsimile number
as may hereafter be furnished to the Purchaser in writing by the Seller.
SECTION 10. Characterization.
The parties hereto agree that it is their express intent that
the conveyance contemplated by this Agreement be, and be treated for all
purposes as, a sale by the Seller of all the Seller's right, title and interest
in and to the Mortgage Loans. The parties hereto further agree that it is not
their intention that such conveyance be deemed a pledge of the Mortgage Loans by
the Seller to secure a debt or other obligation of the Seller. However, in the
event that, notwithstanding the intent of the parties, the Mortgage Loans are
held to continue to be property of the Seller, then: (a) this Agreement shall be
deemed to be a security agreement under applicable law; (b) the transfer of the
Mortgage Loans provided for herein shall be deemed to be a grant by the Seller
to the Purchaser of a first priority security interest in all of the Seller's
right, title and interest in and to the Mortgage Loans and all amounts payable
to the holder(s) of those assets in accordance with the terms thereof (other
than scheduled payments of interest and principal due on or before the Cut-off
Date) and all proceeds of the conversion, voluntary or involuntary, of the
foregoing into cash, instruments, securities or other property; (c) the
assignment by SBMS VII to the Trustee of its interests in the Mortgage Loans as
contemplated by Section 16 hereof shall be deemed to be an assignment of any
security interest created hereunder; (d) the possession by the Purchaser or any
successor thereto of the related Mortgage Notes and such other items of property
as constitute instruments, money, negotiable documents or chattel paper shall be
deemed to be "possession by the secured party" for purposes of perfecting the
security interest pursuant to Section 9-305 of the New York Uniform Commercial
Code and the Uniform Commercial Code of any other applicable jurisdiction; and
(e) notifications to, and acknowledgments, receipts or confirmations from,
persons or entities holding such property, shall be deemed notifications to, or
acknowledgments, receipts or confirmations from, securities intermediaries,
bailees or agents (as applicable) of the Purchaser or any successor thereto for
the purpose of perfecting such security interest under applicable law. The
Seller and the Purchaser shall, to the extent consistent with this Agreement,
take such actions, including the filing of UCC financing statements, as may be
necessary to ensure that, if this Agreement were deemed to create a security
interest in the Mortgage Loans, such security interest would be deemed to be a
perfected security interest of first priority under applicable law
13
and will be maintained as such throughout the term of this Agreement and the
Pooling and Servicing Agreement.
SECTION 11. Representations, Warranties and Agreements to
Survive Delivery.
All representations, warranties and agreements contained in
this Agreement, incorporated herein by reference or contained in the
certificates of officers of the Seller submitted pursuant hereto, shall remain
operative and in full force and effect and shall survive delivery of the
Mortgage Loans by the Seller to the Purchaser.
SECTION 12. Severability of Provisions.
Any part, provision, representation, warranty or covenant of
this Agreement that is prohibited or which is held to be void or unenforceable
shall be ineffective to the extent of such prohibition or unenforceability
without invalidating the remaining provisions hereof. Any part, provision,
representation, warranty or covenant of this Agreement that is prohibited or
unenforceable or is held to be void or unenforceable in any particular
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
particular jurisdiction shall not invalidate or render unenforceable such
provision in any other jurisdiction. To the extent permitted by applicable law,
the parties hereto waive any provision of law which prohibits or renders void or
unenforceable any provision hereof.
SECTION 13. Counterparts.
This Agreement may be executed in any number of counterparts,
each of which shall be deemed to be an original, but all of which together shall
constitute one and the same instrument.
SECTION 14. GOVERNING LAW.
THIS AGREEMENT AND THE RIGHTS, DUTIES, OBLIGATIONS AND
RESPONSIBILITIES OF THE PARTIES HERETO SHALL BE GOVERNED IN ACCORDANCE WITH THE
LAWS AND DECISIONS OF THE STATE OF NEW YORK (WITHOUT REGARD TO CONFLICTS OF LAW
PRINCIPLES). THE PARTIES HERETO INTEND THAT THE PROVISIONS OF SECTION 5-1401 OF
THE NEW YORK GENERAL OBLIGATIONS LAW SHALL APPLY TO THIS AGREEMENT.
SECTION 15. Further Assurances.
The Seller and the Purchaser agree to execute and deliver such
instruments and take such further actions as the other party may, from time to
time, reasonably request in order to effectuate the purposes and to carry out
the terms of this Agreement.
14
SECTION 16. Successors and Assigns.
The rights and obligations of the Seller under this Agreement
shall not be assigned by the Seller without the prior written consent of the
Purchaser, except that any person into which the Seller may be merged or
consolidated, or any corporation or other entity resulting from any merger,
conversion or consolidation to which the Seller is a party, or any person
succeeding to all or substantially all of the business of the Seller, shall be
the successor to the Seller hereunder. In connection with its transfer of the
Mortgage Loans to the Trust as contemplated by the recitals hereto, SBMS VII is
expressly authorized to assign its rights and obligations under this Agreement,
in whole or in part, to the Trustee for the benefit of the registered holders
and beneficial owners of the Certificates. To the extent of any such assignment,
the Trustee (including acting through the Master Servicer and Special Servicer
pursuant to the terms of the Pooling and Servicing Agreement), for the benefit
of the registered holders and beneficial owners of the Certificates, shall be
the Purchaser hereunder. In connection with the transfer of any Mortgage Loan by
the Trust as contemplated by the terms of the Pooling and Servicing Agreement,
the Trustee, for the benefit of the registered holders and beneficial owners of
the Certificates, is expressly authorized to assign its rights and obligations
under this Agreement, in whole or in part, to the transferee of such Mortgage
Loan. To the extent of any such assignment, such transferee shall be the
Purchaser hereunder (but solely with respect to such Mortgage Loan that was
transferred to it). Subject to the foregoing, this Agreement shall bind and
inure to the benefit of and be enforceable by the Seller and the Purchaser, and
their respective successors and permitted assigns.
SECTION 17. Amendments.
(a) No term or provision of this Agreement may be waived or
modified unless such waiver or modification is in writing and signed by a duly
authorized officer of the party against whom such waiver or modification is
sought to be enforced.
(b) Notwithstanding any contrary provision of this Agreement
or the Pooling and Servicing Agreement, no amendment of the Pooling and
Servicing Agreement executed after the Closing Date that increases the
obligations of or otherwise adversely affects the Seller, shall be effective
against the Seller.
SECTION 18. Entire Agreement.
Except as otherwise expressly contemplated hereby, this
Agreement constitutes the entire agreement and understanding of the parties with
respect to the matters addressed herein, and this Agreement supersedes any prior
agreements and/or understandings, written or oral, with respect to such matters.
[SIGNATURE PAGE FOLLOWS]
15
IN WITNESS WHEREOF, the Seller and the Purchaser have caused
their names to be signed hereto by their respective duly authorized officers as
of the date first above written.
SALOMON BROTHERS REALTY CORP.
By:
-----------------------------------------
Name:
Title:
SALOMON BROTHERS MORTGAGE
SECURITIES VII, INC.
By:
-----------------------------------------
Name:
Title:
EXHIBIT A
MORTGAGE LOAN SCHEDULE
CONTROL LOAN ZIP
NUMBER LOAN / PROPERTY NAME NUMBER ORIGINATOR PROPERTY ADDRESS CITY STATE CODE
000 Xxxxxx Xxxxxxxx Xxxxxx 7E+06 SBRC 0000 XX Xxxxxx Xxxxxxxxx Xxxxxxxxx XX 00000
106 The Cannery 7E+06 SBRC 0000 Xxxxxxxxxxx Xxxxxx Xxx Xxxxxxxxx XX 00000
110 A&P Xxxxxxxxx - Xxxxxxx Xxxxx 0Xx00 XXXX 00 Xxxxxxxxx Xxxxxx Xxxxxxx Xxxxx XX 00000
111 A&P Warehouse - Baltimore 7E+06 SBRC 0000 Xxxxxxx Xxxxx Xxxx Xxxxxxxxx XX 00000
000 Xxxxxxxxxx Xxxxxxxx 0Xx00 XXXX 0000-0000 Xxxxx Xxxxxx Xxxxxx Xxxxxxxxx XX 00000
000 Xxxxxxx Xxxxxxxx Xxxx Loan # 3 7E+06 SBRC 1400 and 0000 Xxxxx XxXxxxxx Xxxxxxxx XX 00000
Xxxxxxxxx
000 Xxxxx'x Xxxxxx Xxxxxx 0Xx00 XXXX 0000-0000 Xxxxx Xxxxxx Xxxxx Xxxxx XX 00000
000 Xxxxxx Xxxxxx Xxxxxxxx Xxxxxx 7E+06 SBRC 0000 X.X. Xxxxx Xxxxxxxxx Xxxxxxxxxxx XX 00000
000 Xxxxxxxx Xxxxx Xxxxxxxxxx 0Xx00 SBRC Xxxxxxxx Xxxxxx Xxxxx Xxxxxxxxxx XX 00000
000 Xxxxxxx Xxxxxxxx 0Xx00 XXXX 00 Xxxxxxxx Xxxxxx Xxxxxxxxx Xxxxxx Xxxx Xxxxxx XX 00000
000 Xxxxxxx Xxxx Xxxxx 0Xx00 XXXX 0000-0000 Xxxxxxxx Xxxxxx Xxxxxx Xxxxxxxxx XX 00000
127 Joesler Village 7E+06 SBRC 0000-0000 Xxxx Xxxxx Xxxx xxx Xxxxxx XX 00000
0000-0000 Xxxxxxxx Xxxxxx
130 North Xxxxxx Shopping Center 7E+06 SBRC 0000 Xxxxxxx Xxxx Xxxxxxxxx XX 00000
000 Xxxxxxx Xxxxxxxx Xxxx Loan # 4 7E+06 SBRC 0000 Xxx Xxxxxxx Xxxxxxx Xxxxxxxx XX 00000
000 Xxxx Xxxx Xxxxxx 7E+06 SBRC 0000-0000 00xx Xxxxxx Xxxxxx Xxxxxxxxx XX 00000
000 Xxxxxxxxx Xxxxxxxxxx / Xxxxxxx 7E+06 SBRC
Xxxx Apartments Portfolio
136a Remington Apartments 7001963a SBRC 0000 Xxxxx Xxxxx Xx Xxxxxx Xxxxxxxx Xxxx XX 00000
000x Xxxxxxx Xxxx Xxxxxxxxxx 7001963b SBRC 0000 Xxxxxxxxx 00xx Xxxxxx Xxxxxxxx Xxxx XX 00000
000 Xxxxxxxxx Xxxxxxxxxx 0Xx00 XXXX 000 Xxxxxxxxx Xxxxxx Xxxxxxx XX 00000
000 Xxxxx Xxxxxxxx Xxxxxxx 0Xx00 XXXX 0000-0000 Xxxxx Xxxx Xxxxxxxxx XX 00000
151 Eatontown Shopping Center 7E+06 SBRC 00 Xxxxx 00 Xxxxxxxxx XX 00000
153 Kmart Centre 7E+06 SBRC 0000 Xxxxx Xxxx Xxxxx Xxxxxx XX 00000
000 Xxxxxx Xxxxx Xxxxx 0Xx00 XXXX 000-000 Xxxx Xxxxxxxx Xxxx Xxxxxxxxxx XX 00000
159 1500 Xxxxxx Xxxxxx 0Xx00 XXXX 0000 Xxxxxx Xxxxxx Xxxxxx XX 00000
162 Valley View Mobile Home Park 7E+06 SBRC 0000 Xxxxxxx Xxxxxx Xxxxxxxxx XX 00000
000 Xxxxxxxx Xxxxx 0Xx00 XXXX 0000 Xxx Xxxx Xxxxxxx XX 00000
170 Lake Xxxxxxx Trading Post 7E+06 SBRC 0000 Xxxxx Xxxxxx Xxxxxx Xxxxxxxxxxx XX 00000
and Xxxxxxx
Road
177 Federal Highway Self Storage 7E+06 SBRC 000 Xxxxx Xxxxxxx Xxxxxxx Xxxxxxxxx Xxxxx XX 00000
178 Xxxxxxxxxx Xxxxxxx Xxxxxxxx Xxxxxx 0Xx00 XXXX 11316-11328 Xxxxxxxxxx Xxxx Xxxxxxx XX 00000
000 Xxxxxxxx/Xxxxx Xxxxxx 7E+06 SBRC 000-000 Xxxxxxxx Xxxxxx Xxxxxx XX 00000
000 Xxxxxxxxx Xxxxxx 7E+06 SBRC 0000-0000 Xxxxxxxx Xxxx Xxxxxxxxxx XX 00000
000 Xxxx Xxxxxx Xxxxx 7E+06 SBRC 0000 Xxxx Xxxxxx Xxxxx Xxxx Xxxx XX 00000
205 00 Xxxxx Xxxxxx 0Xx00 XXXX 00 Xxxxx Xxxxxx Xxxxxxxxx XX 00000
208 Continental Apartments 7E+06 SBRC 0000 Xxxxx Xxxxxx Xxxxxxx XX 00000
PROPERTY
CONTROL PROPERTY SIZE UNIT
NUMBER SIZE TYPE
105 333,708 SF
106 98,841 SF
110 575,547 SF
111 776,172 SF
112 241,269 SF
114 144,000 SF
117 84,904 SF
118 203,513 SF
119 157 Units
122 75,795 SF
126 90,411 SF
127 72,873 SF
130 149,036 SF
131 66,656 SF
135 101,192 SF
136 341 Xxxxx
000x 000 Xxxxx
000x 000 Xxxxx
141 137 Units
143 141,860 SF
151 29,911 SF
153 156,709 SF
158 52,138 SF
159 104,486 SF
162 145 Units
169 98,216 SF
170 74,138 SF
177 67,266 SF
178 87,519 SF
183 72,830 SF
189 40,693 SF
193 21,186 SF
205 15,660 SF
208 65 Units
A-1
CROSS
COLLATER-
ALIZED
MORTGAGE
CROSS LOAN GROUP
COLLATER- AGGREGATE
ALIZED CUT-OFF
(MORTGAGE DATE ORIGINAL MASTER INTEREST
CONTROL LOAN PRINCIPAL OWNERSHIP PRINCIPAL MORTGAGE SERVICING RATE ACCRUAL
NUMBER LOAN/PROPERTY NAME GROUP) BALANCE INTEREST BALANCE RATE FEE RATE TYPE METHOD
000 Xxxxxx Xxxxxxxx Xxxxxx No 23,967,790 Fee Simple 24,000,000 7.3100% 0.0625% Fixed Actual/360
106 The Cannery No 19,309,776 Fee Simple 19,350,000 7.4000% 0.0725% Fixed Actual/360
110 A&P Warehouse - Central Islip No 17,655,342 Fee Simple 17,802,410 8.1900% 0.0625% Fixed Actual/360
111 A&P Warehouse - Baltimore No 17,431,347 Fee Simple 17,576,549 8.1900% 0.0625% Fixed Actual/360
112 Cumberland Crossing No 16,052,089 Fee Simple 16,065,000 7.1000% 0.0625% Fixed Actual/360
000 Xxxxxxx Xxxxxxxx Xxxx Loan # 3 No 15,659,163 Fee Simple 15,700,000 7.4600% 0.0725% Fixed Actual/360
117 Ralph's Market Center No 12,612,485 Fee Simple 12,640,000 7.2000% 0.0625% Fixed Actual/360
Fee Simple
in part,
Leasehold
000 Xxxxxx Xxxxxx Shopping Center No 12,573,502 in part 12,600,000 7.3500% 0.0925% Fixed Actual/360
119 Woodland Manor Apartments No 12,349,821 Fee Simple 12,500,000 7.8000% 0.1475% Fixed Actual/360
122 Medical Pavilion No 9,942,083 Fee Simple 9,975,000 7.2900% 0.0625% Fixed Actual/360
000 Xxxxxxx Xxxx Xxxxx No 9,560,461 Fee Simple 9,595,000 6.9500% 0.0625% Fixed Actual/360
127 Joesler Village No 9,553,218 Fee Simple 9,600,000 7.1400% 0.0625% Fixed Actual/360
130 North Xxxxxx Shopping Center No 8,672,326 Fee Simple 8,700,000 7.4300% 0.0625% Fixed Actual/360
000 Xxxxxxx Xxxxxxxx Xxxx Loan # 4 No 8,502,544 Fee Simple 8,525,000 7.4100% 0.0725% Fixed Actual/360
000 Xxxx Xxxx Xxxxxx No 7,961,446 Fee Simple 7,985,000 6.9500% 0.0625% Fixed Actual/360
Remington Apartments/
Xxxxxxx
136 Xxxx Apartments Portfolio No 7,498,902 7,515,000 7.2700% 0.0725% Fixed Actual/360
000x Xxxxxxxxx Xxxxxxxxxx Xxx Xxxxxx
000x Xxxxxxx Xxxx Apartments Fee Simple
141 Xxxxxxxxx Apartments No 6,976,233 Fee Simple 7,000,000 7.1800% 0.1125% Fixed Actual/360
143 Xxxxx Business Complex No 6,774,809 Fee Simple 6,800,000 7.6900% 0.1125% Fixed Actual/360
151 Eatontown Shopping Center No 5,978,228 Fee Simple 6,000,000 7.7700% 0.1475% Fixed Actual/360
153 Kmart Centre No 5,584,454 Fee Simple 5,600,000 7.9300% 0.1125% Fixed Actual/360
000 Xxxxxx Xxxxx Xxxxx No 4,983,926 Fee Simple 5,000,000 7.3900% 0.0625% Fixed Actual/360
159 0000 Xxxxxx Xxxxxx No 4,901,727 Fee Simple 4,920,000 7.6800% 0.0625% Fixed Actual/360
162 Valley View Mobile Home Park No 4,693,356 Fee Simple 4,700,000 7.1000% 0.0625% Fixed Actual/360
000 Xxxxxxxx Xxxxx No 4,194,489 Fee Simple 4,200,000 7.4000% 0.0625% Fixed Actual/360
000 Xxxx Xxxxxxx Trading Post No 4,063,772 Fee Simple 4,080,000 7.4100% 0.1125% Fixed Actual/360
000 Xxxxxxx Xxxxxxx Self Storage No 3,785,224 Fee Simple 3,800,000 7.5000% 0.0625% Fixed Actual/360
000 Xxxxxxxxxx Xxxxxxx Xxxxxxxx Xxxxxx No 3,706,138 Fee Simple 3,719,600 7.7800% 0.1225% Fixed Actual/360
000 Xxxxxxxx/Xxxxx Xxxxxx No 3,238,593 Fee Simple 3,250,000 7.0500% 0.0625% Fixed Actual/360
000 Xxxxxxxxx Xxxxxx No 2,988,714 Fee Simple 3,000,000 7.6300% 0.1475% Fixed Actual/360
000 Xxxx Xxxxxx Xxxxx No 2,874,891 Leasehold 2,886,000 7.5400% 0.1125% Fixed Actual/360
205 00 Xxxxx Xxxxxx No 2,210,746 Fee Simple 2,250,000 7.3500% 0.0625% Fixed Actual/360
208 Continental Apartments No 1,957,461 Fee Simple 1,960,000 7.4500% 0.1125% Fixed Actual/360
ANTICI-
PATED SCHED-
REPAY- ULED
CONTROL NOTE MENT MATURITY
NUMBER LOAN TYPE DATE DATE DATE
105 ARD 09/28/01 10/01/11 10/01/31
106 Balloon 08/06/01 NAP 09/01/11
110 Balloon 02/13/01 NAP 03/01/11
111 Balloon 02/13/01 NAP 03/01/11
112 Balloon 10/24/01 NAP 11/01/11
114 Balloon 07/19/01 NAP 08/01/11
117 Balloon 08/22/01 NAP 09/01/11
118 Balloon 08/29/01 NAP 09/01/11
119 Balloon 04/18/00 NAP 05/01/10
122 Balloon 06/26/01 NAP 07/01/11
126 Balloon 06/13/01 NAP 07/01/11
127 Balloon 04/20/01 NAP 05/01/11
130 Balloon 06/08/01 NAP 07/01/11
131 Balloon 07/19/01 NAP 08/01/11
135 Balloon 07/03/01 NAP 08/01/11
136 Balloon 08/07/01 NAP 09/01/11
136a
136b
141 Balloon 06/07/01 NAP 07/01/11
143 Balloon 05/17/01 NAP 06/01/11
151 Balloon 05/09/01 NAP 06/01/11
153 Balloon 06/14/01 NAP 07/01/11
158 Balloon 06/29/01 NAP 07/01/11
159 Balloon 05/23/01 NAP 06/01/08
162 Balloon 09/06/01 NAP 10/01/11
169 Balloon 09/06/01 NAP 10/01/11
170 Balloon 05/10/01 NAP 06/01/11
177 Balloon 05/14/01 NAP 06/01/11
178 Balloon 05/04/01 NAP 06/01/11
183 Balloon 06/13/01 NAP 07/01/11
189 Balloon 05/09/01 NAP 06/01/11
193 Balloon 05/16/01 NAP 06/01/06
205 Balloon 03/15/01 NAP 04/01/11
208 Balloon 09/25/01 NAP 10/01/11
A-2
STATED STATED
ORIGINAL ORIGINAL REMAINING REMAINING
MONTHLY TERM TO AMORT- TERM TO AMORT-
DEBT MATURITY/ IZATION MATURITY/ IZATION
CONTROL SERVICE ARD TERM ARD TERM CUT-OFF DATE LOAN BALANCE AT
NUMBER LOAN / PROPERTY NAME PAYMENT (MONTHS) (MONTHS) (MONTHS) (MONTHS) PRINCIPAL BALANCE MATURITY / ARD
000 Xxxxxx Xxxxxxxx Xxxxxx 164,700.15 120 360 118 358 23,967,790.02 21,097,897.00
106 The Cannery 133,975.49 120 360 117 357 19,309,775.94 17,047,155.81
A&P Warehouse - Central
110 Islip 139,650.08 120 300 111 291 17,655,342.41 14,756,983.54
111 A&P Warehouse - Baltimore 137,878.33 120 300 111 291 17,431,347.23 14,569,759.27
112 Cumberland Crossing 107,961.93 120 360 119 359 16,052,089.32 14,043,652.70
000 Xxxxxxx Xxxxxxxx Xxxx 109,346.97 120 360 116 356 15,659,162.69 13,854,818.30
Xxxx # 0
000 Xxxxx'x Xxxxxx Center 85,798.83 120 360 117 357 12,612,485.06 11,078,796.51
000 Xxxxxx Xxxxxx Shopping 86,810.49 120 360 117 357 12,573,502.39 11,086,374.46
Center
119 Woodland Manor Apartments 89,983.81 120 360 101 341 12,349,820.90 11,126,009.09
122 Medical Pavilion 68,317.92 120 360 115 355 9,942,082.75 8,766,020.78
000 Xxxxxxx Xxxx Xxxxx 63,513.90 120 360 115 355 9,560,461.38 8,357,301.61
127 Joesler Village 64,774.20 120 360 113 353 9,553,217.70 8,403,996.94
130 North Xxxxxx Shopping 60,415.19 120 360 115 355 8,672,325.58 7,672,941.59
Center
000 Xxxxxxx Xxxxxxxx Xxxx 59,083.55 120 360 116 356 8,502,544.34 7,513,566.45
Xxxx # 0
000 Xxxx Xxxx Xxxxxx 52,856.54 120 360 116 356 7,961,445.78 6,953,986.21
000 Xxxxxxxxx Xxxxxxxxxx /
Xxxxxxx
Xxxx Apartments Portfolio 51,367.53 120 360 117 357 7,498,901.81 6,598,706.44
000x Xxxxxxxxx Xxxxxxxxxx
000x Xxxxxxx Xxxx Apartments
141 Xxxxxxxxx Apartments 47,420.44 120 360 115 355 6,976,233.16 6,134,104.12
143 Xxxxx Business Complex 48,434.39 120 360 114 354 6,774,808.92 6,035,554.23
000 Xxxxxxxxx Xxxxxxxx Xxxxxx 43,067.69 120 360 114 354 5,978,227.59 5,335,950.14
153 Kmart Centre 40,817.87 120 360 115 355 5,584,454.24 5,000,279.55
000 Xxxxxx Xxxxx Xxxxx 34,584.89 120 360 115 355 4,983,926.41 4,405,256.13
159 0000 Xxxxxx Xxxxxx 35,009.79 84 360 78 354 4,901,726.52 4,579,612.46
162 Valley View Mobile Home 31,585.50 120 360 118 358 4,693,355.75 4,109,249.34
Park
000 Xxxxxxxx Xxxxx 29,079.95 120 360 118 358 4,194,489.15 3,700,616.62
170 Lake Xxxxxxx Trading Post 28,276.93 120 360 114 354 4,063,771.68 3,596,068.11
000 Xxxxxxx Xxxxxxx Self 26,570.15 120 360 114 354 3,785,223.67 3,356,900.11
Storage
000 Xxxxxxxxxx Village 26,724.82 120 360 114 354 3,706,137.59 3,308,741.73
Shopping Center
000 Xxxxxxxx/Xxxxx Xxxxxx 21,731.58 120 360 115 355 3,238,592.74 2,838,288.47
000 Xxxxxxxxx Xxxxxx 21,244.13 120 360 114 354 2,988,713.78 2,658,799.00
000 Xxxx Xxxxxx Xxxxx 20,258.44 60 360 54 354 2,874,890.80 2,750,441.87
000 00 Xxxxx Xxxxxx 18,811.73 120 216 112 208 2,210,745.90 1,392,727.05
208 Continental Apartments 13,637.56 120 360 118 358 1,957,460.55 1,729,141.85
A-3
YIELD
DEFEASE- MAINTEN- YIELD YIELD
ANCE DEFEASE- ANCE MAINTEN- PREPAYMENT PREPAYMENT MAINTENANCE
CONTROL START ANCE END PERIOD ANCE PERIOD PENALTY START PENALTY END CALCULATION
NUMBER LOAN / PROPERTY NAME DATE DATE START DATE END DATE DATE DATE METHOD
000 Xxxxxx Xxxxxxxx Xxxxxx 01/01/04 07/31/11 NAP NAP NAP NAP NAP
106 The Cannery 01/01/04 07/31/11 NAP NAP NAP NAP NAP
110 A&P Warehouse - Central Islip 01/01/04 10/31/10 NAP NAP NAP NAP NAP
111 A&P Warehouse - Baltimore 01/01/04 10/31/10 NAP NAP NAP NAP NAP
112 Cumberland Crossing 01/01/04 09/30/11 NAP NAP NAP NAP NAP
000 Xxxxxxx Xxxxxxxx Xxxx Loan # 3 01/01/04 06/30/11 NAP NAP NAP NAP NAP
117 Ralph's Market Center 01/01/04 07/31/11 NAP NAP NAP NAP NAP
000 Xxxxxx Xxxxxx Shopping Center 01/01/04 07/31/11 NAP NAP NAP NAP NAP
119 Woodland Manor Apartments 01/01/04 01/31/10 NAP NAP NAP NAP NAP
122 Medical Pavilion 01/01/04 04/30/11 NAP NAP NAP NAP NAP
000 Xxxxxxx Xxxx Xxxxx 01/01/04 04/30/11 NAP NAP NAP NAP NAP
127 Joesler Village 01/01/04 02/28/11 NAP NAP NAP NAP NAP
130 North Xxxxxx Shopping Center 01/01/04 04/30/11 NAP NAP NAP NAP NAP
000 Xxxxxxx Xxxxxxxx Xxxx Loan # 4 01/01/04 06/30/11 NAP NAP NAP NAP NAP
000 Xxxx Xxxx Xxxxxx 01/01/04 05/31/11 NAP NAP NAP NAP NAP
136 Remington Apartments / 01/01/04 06/30/11 NAP NAP NAP NAP NAP
Xxxxxxx
Xxxx Xxxxxxxxxx Xxxxxxxxx
000x Xxxxxxxxx Apartments
136b Xxxxxxx Xxxx Apartments
141 Xxxxxxxxx Apartments 01/01/04 04/30/11 NAP NAP NAP NAP NAP
143 Xxxxx Business Complex 01/01/04 02/28/11 NAP NAP NAP NAP NAP
151 Eatontown Shopping Center 01/01/04 04/30/11 NAP NAP NAP NAP NAP
153 Kmart Centre 01/01/04 04/30/11 NAP NAP NAP NAP NAP
000 Xxxxxx Xxxxx Xxxxx 01/01/04 04/30/11 NAP NAP NAP NAP NAP
159 0000 Xxxxxx Xxxxxx 01/01/04 03/31/08 NAP NAP NAP NAP NAP
162 Valley View Mobile Home Park 01/01/04 07/31/11 NAP NAP NAP NAP NAP
000 Xxxxxxxx Xxxxx 01/01/04 07/31/11 NAP NAP NAP NAP NAP
170 Lake Xxxxxxx Trading Post 01/01/04 03/31/11 NAP NAP NAP NAP NAP
000 Xxxxxxx Xxxxxxx Self Storage 01/01/04 03/31/11 NAP NAP NAP NAP NAP
000 Xxxxxxxxxx Village Shopping 01/01/04 03/31/11 NAP NAP NAP NAP NAP
Center
183 Mountain/Arrow Center 01/01/04 04/30/11 NAP NAP NAP NAP NAP
000 Xxxxxxxxx Xxxxxx 01/01/04 03/31/11 NAP NAP NAP NAP NAP
000 Xxxx Xxxxxx Xxxxx 01/01/04 03/31/06 NAP NAP NAP NAP NAP
205 00 Xxxxx Xxxxxx 01/01/04 01/31/11 NAP NAP NAP NAP NAP
208 Continental Apartments 01/01/04 07/31/11 NAP NAP NAP NAP NAP
YIELD
MAINTENANCE
INTEREST RATE YIELD
YIELD CONVERTED TO MAINTENANCE
CONTROL MAINTENANCE MONTHLY INTEREST RATE
NUMBER INTEREST RATE MORTGAGE RATE REFERENCE DATE
105 NAP NAP NAP
106 NAP NAP NAP
110 NAP NAP NAP
111 NAP NAP NAP
112 NAP NAP NAP
114 NAP NAP NAP
117 NAP NAP NAP
118 NAP NAP NAP
119 NAP NAP NAP
122 NAP NAP NAP
126 NAP NAP NAP
127 NAP NAP NAP
130 NAP NAP NAP
131 NAP NAP NAP
135 NAP NAP NAP
136 NAP NAP NAP
136a
136b
141 NAP NAP NAP
143 NAP NAP NAP
151 NAP NAP NAP
153 NAP NAP NAP
158 NAP NAP NAP
159 NAP NAP NAP
162 NAP NAP NAP
169 NAP NAP NAP
170 NAP NAP NAP
177 NAP NAP NAP
178 NAP NAP NAP
183 NAP NAP NAP
189 NAP NAP NAP
193 NAP NAP NAP
205 NAP NAP NAP
208 NAP NAP NAP
A-4
EXHIBIT B
REPRESENTATIONS AND WARRANTIES WITH RESPECT TO THE SELLER
The Seller hereby represents and warrants that, as of the Closing Date:
(a) The Seller is a corporation duly organized, validly existing and in
good standing under the laws of the State of New York.
(b) The execution and delivery by the Seller of this Agreement, the
execution (including, without limitation, by facsimile or machine signature) and
delivery of any and all documents contemplated by this Agreement, including,
without limitation, endorsements of Mortgage Notes, and the performance and
compliance by the Seller with the terms of this Agreement will not: (i) violate
the Seller's organizational documents; or (ii) constitute a default (or an event
which, with notice or lapse of time, or both, would constitute a default) under,
or result in the breach of, any indenture, agreement or other instrument to
which the Seller is a party or by which it is bound or which is applicable to it
or any of its assets, which default or breach, in the Seller's good faith and
reasonable judgment, is likely to affect materially and adversely either the
ability of the Seller to perform its obligations under this Agreement or the
financial condition of the Seller.
(c) The Seller has full power and authority to enter into and fully
perform under this Agreement, has duly authorized the execution, delivery and
performance of this Agreement, and has duly executed and delivered this
Agreement.
(d) The Seller has the full right, power and authority to sell, assign,
transfer, set over and convey the Mortgage Loans (and, in the event that the
related transaction is deemed to constitute a loan secured by all or part of the
Mortgage Loans, to pledge the Mortgage Loans) in accordance with, and under the
conditions set forth in, this Agreement.
(e) Assuming due authorization, execution and delivery hereof by the
Purchaser, this Agreement constitutes a valid, legal and binding obligation of
the Seller, enforceable against the Seller in accordance with the terms hereof,
subject to: (i) applicable bankruptcy, insolvency, reorganization, moratorium
and other laws affecting the enforcement of creditors' rights generally, and
(ii) general principles of equity, regardless of whether such enforcement is
considered in a proceeding in equity or at law.
(f) The Seller is not in violation of, and its execution and delivery
of this Agreement and its performance and compliance with the terms hereof will
not constitute a violation of, any law, any order or decree of any court or
arbiter, or any order, regulation or demand of any federal, state or local
governmental or regulatory authority, which violation, in the Seller's good
faith and reasonable judgment, is likely to affect materially and adversely
either the ability of the Seller to perform its obligations under this Agreement
or the financial condition of the Seller.
(g) There are no actions, suits or proceedings pending or, to the best
of the Seller's knowledge, threatened against the Seller which, if determined
adversely to the Seller, would prohibit the Seller from entering into this
Agreement or, in the Seller's good faith and reasonable judgment, would be
likely to affect materially and adversely either the ability of the Seller to
perform its obligations hereunder or the financial condition of the Seller.
B-1
(h) No consent, approval, authorization or order of, or filing or
registration with, any state or federal court or governmental agency or body is
required for the consummation by the Seller of the transactions contemplated
herein, except for those consents, approvals, authorizations and orders that
previously have been obtained and those filings and registrations that
previously have been completed, and except for those filings and recordings of
Mortgage Loan documents and assignments thereof that are contemplated by the
Pooling and Servicing Agreement to be completed after the Closing Date.
(i) The transfer of the Mortgage Loans to the Purchaser as contemplated
herein is not subject to any bulk transfer or similar law in effect in any
applicable jurisdiction.
(j) The Mortgage Loans do not constitute all or substantially all of
the assets of the Seller.
(k) The Seller is not transferring the Mortgage Loans to the Purchaser
with any intent to hinder, delay or defraud its present or future creditors.
(l) The Seller will be solvent at all relevant times prior to, and will
not be rendered insolvent by, its transfer of the Mortgage Loans to the
Purchaser, as contemplated herein.
(m) After giving effect to its transfer of the Mortgage Loans to the
Purchaser, as provided herein, the value of the Seller's assets, either taken at
their present fair saleable value or at fair valuation, will exceed the amount
of the Seller's debts and obligations, including contingent and unliquidated
debts and obligations of the Seller, and the Seller will not be left with
unreasonably small assets or capital with which to engage in and conduct its
business.
(n) The Seller does not intend to, and does not believe that it will,
incur debts or obligations beyond its ability to pay such debts and obligations
as they mature.
(o) The consideration to be received by the Seller in connection with
its transfer of the Mortgage Loans to the Purchaser, as provided herein,
constitutes at least reasonably equivalent value and fair consideration for the
Mortgage Loans.
(p) No proceedings looking toward liquidation, dissolution or
bankruptcy of the Seller are pending or contemplated.
B-2
EXHIBIT C
All exceptions to any representation and warranty should be scheduled
on a schedule or exhibit denominated to match the Section number of the specific
representation and warranty, e.g., Schedule C-12(a). Each such Schedule shall
set forth the specific exception or exceptions to the specific part or parts of
the related representation and warranty and not simply list the loan. The
standard for repurchase is to be any breach that materially and adversely
effects the value of the Mortgage Loan, the Mortgaged Property, the interests of
the Trust/Trustee in such Mortgage Loan or the interests of the
Certificateholders, or any one of them, including any economic interest, in such
Mortgage Loan.
For purposes of these representations and warranties, the phrases "to
the knowledge of the Seller" or "to the Seller's knowledge" shall mean, except
where otherwise expressly set forth below, the actual state of knowledge of the
Seller or any servicer acting on its behalf regarding the matters referred to,
in each case (i) solely in the case of the Seller, after having conducted such
inquiry and due diligence into such matters as would be customarily performed by
prudent institutional commercial or multifamily mortgage lenders, as applicable,
and in all events as required by the Seller's underwriting standards, at the
time of the Seller's origination or acquisition, as applicable, of the
particular Mortgage Loan and (ii) subsequent to such origination, utilizing the
servicing and monitoring practices customarily utilized by prudent commercial
mortgage loan servicers with respect to securitizable commercial or multifamily,
as applicable, mortgage loans, and the phrases "to the actual knowledge of the
Seller" or "to the Seller's actual knowledge" shall mean, except where otherwise
expressly set forth below, the actual state of knowledge of the Seller or any
servicer acting on its behalf without any express or implied obligation to make
inquiry. All information contained in documents which are part of or required to
be part of a Mortgage File shall be deemed to be within the knowledge and the
actual knowledge of the Seller. Wherever there is a reference to receipt by, or
possession of, the Seller of any information or documents, or to any action
taken by the Seller or not taken by the Seller or its agents or employees, such
reference shall include the receipt or possession of such information or
documents by, or the taking of such action or the not taking such action by,
either of the Seller or any servicer acting on its behalf.
REPRESENTATIONS AND WARRANTIES
WITH RESPECT TO THE MORTGAGE LOANS
The Seller hereby represents and warrants that, as of the date
hereinbelow specified or, if no such date is specified, as of the Closing Date:
1. Mortgage Loan Schedule. The information set forth in the Mortgage
Loan Schedule with respect to the Mortgage Loans is true and correct in all
material respects as of the respective Due Dates for the Mortgage Loans in
December 2001.
2. Ownership of Mortgage Loans. Immediately prior to the transfer of
the Mortgage Loans to the Purchaser, the Seller had good and marketable title
to, and was the sole owner of, each Mortgage Loan. The Seller has full right,
power and authority to sell, transfer and assign each Mortgage Loan to, or at
the direction of, the Purchaser free and clear of any and all pledges, liens,
claims, charges, security interests, participation interests and/or other
interests
C-1
and encumbrances. Subject to the completion of all recording and filing
contemplated hereby and by the Pooling and Servicing Agreement, the Seller will
have validly and effectively conveyed to the Purchaser all legal and beneficial
interest in and to each Mortgage Loan free and clear of any pledge, lien, claim,
charge, security interest or other encumbrance, or participation interest or any
other ownership interest, or any other interest of any kind or nature
whatsoever, except for the servicing rights identified on Schedule C-42. The
sale of the Mortgage Loans to the Purchaser or its designee does not require the
Seller to obtain any governmental or regulatory approval or consent that has not
been obtained. Each Mortgage Note is, or shall be as of the Closing Date,
properly endorsed to the Purchaser or its designee and each such endorsement is
genuine.
3. Payment Record. No scheduled payment of principal and interest due
under any Mortgage Loan on the Due Date in December 2001 or on any Due Date in
the twelve-month period immediately preceding the Due Date for such Mortgage
Loan in December 2001 is or was 30 days or more delinquent, without giving
effect to any applicable grace period.
4. Lien; Valid Assignment. The Mortgage related to and delivered in
connection with each Mortgage Loan is properly recorded in the applicable
jurisdiction and constitutes a valid and, subject to the exceptions and
limitations set forth in Paragraph 13 below, enforceable first priority lien
upon the related Mortgaged Property, prior to all other liens and encumbrances
and except for (a) the lien for current real estate taxes, water charges, sewer
rents and assessments not yet due and payable, (b) covenants, conditions and
restrictions, rights of way, easements and other matters that are of public
record referred to in the related lender's title insurance policy (or, if not
yet issued, referred to in a pro forma title policy or title policy commitment
meeting the requirements described below in Paragraph 8), none of which
materially interferes with the security intended to be provided by such
Mortgage, the current principal use of the related Mortgaged Property or the
current ability of the related Mortgaged Property to generate income sufficient
to service such Mortgage Loan, (c) any other exceptions and exclusions
specifically referred to in such lender's title insurance policy (or, if not yet
issued, referred to in a pro forma title policy or title policy commitment
meeting the requirements described below in Paragraph 8), none of which
materially interferes with the security intended to be provided by such
Mortgage, the current principal use of the related Mortgaged Property or the
current ability of the related Mortgaged Property to generate income sufficient
to service such Mortgage Loan, (d) other matters to which like properties are
commonly subject, none of which materially interferes with the security intended
to be provided by such Mortgage, the current principal use of the related
Mortgaged Property or the current ability of the related Mortgaged Property to
generate income sufficient to service the related Mortgage Loan, (e) the rights
of tenants (as tenants only) under leases (including subleases) pertaining to
the related Mortgaged Property which do not materially interfere with the
security intended to be provided by such Mortgage, (f) condominium declarations
of record and identified in the lender's title insurance policy (or, if not yet
issued, identified in a pro forma title policy or title policy commitment
meeting the requirements described in Paragraph 8 below) and (g) if such
Mortgage Loan constitutes a Cross-Collateralized Mortgage Loan, the lien of the
Mortgage for another Mortgage Loan contained in the same Cross-Collateralized
Group (the foregoing items (a) through (g) being herein referred to as the
"Permitted Encumbrances"). Such Permitted Encumbrances do not, individually or
in the aggregate, materially interfere with the security intended to be provided
by such Mortgage or adversely effect the value or marketability of the
C-2
Mortgaged Property. The related assignment of such Mortgage executed and
delivered in favor of the Trustee is in recordable form (but for insertion of
the name and address of the assignee and any related recording information which
is not yet available to the Seller) to validly and effectively convey the
assignor's interest therein and constitutes a legal, valid, binding and, subject
to the exceptions and limitations set forth in Paragraph 13 below, enforceable
assignment of such Mortgage from the relevant assignor to the Trustee.
5. Assignment of Leases and Rents. The Mortgage Loan is secured by an
assignment of leases and rents ("Assignment of Leases"), which is either a
separate instrument or is incorporated into the related Mortgage, and which
establishes and creates a valid, subsisting and, subject to the exceptions and
limitations set forth in Paragraph 13 below, enforceable first priority lien on
and security interest in, subject to applicable law, the property, rights and
interests of the related Borrower described therein; and each assignor
thereunder has the full right to assign the same. The related assignment of any
Assignment of Leases not included in a Mortgage, executed and delivered in favor
of the Trustee is in recordable form (but for insertion of the name and address
of the assignee and any related recording information which is not yet available
to the Seller) to validly and effectively convey the assignor's interest therein
and constitutes a legal, valid, binding and, subject to the exceptions and
limitations set forth in Paragraph 13 below, enforceable assignment of such
Assignment of Leases from the relevant assignor to the Trustee.
6. Mortgage Status; Waivers and Modifications. In the case of each
Mortgage Loan, except by a written instrument which has been delivered to the
Purchaser or its designee as a part of the related Mortgage File, (a) the
related Mortgage (including any amendments or supplements thereto included in
the related Mortgage File) has not been impaired, waived, modified, altered,
satisfied, canceled, subordinated or rescinded in any material respect, (b)
neither the related Mortgaged Property nor any material portion thereof has been
released from the lien of such Mortgage and (c) the related Borrower has not
been released from its obligations under such Mortgage, in whole or in material
part. Except as described on Schedule C-6 hereto, no alterations, waivers,
modifications or assumptions of any kind have intentionally been given, made or
consented to by or on behalf of the Seller since November 2, 2001. The Seller
has not taken any affirmative action that would cause the representations and
warranties of the related Borrower under any Mortgage Loan not to be true and
correct in any material respect.
7. Condition of Property; Condemnation. In the case of each Mortgage
Loan, one or more engineering assessments were performed by an independent
engineering consultant firm and except as set forth in an engineering report
prepared in connection with such assessment, the related Mortgaged Property, to
the Seller's knowledge, was as of origination, and, to Seller's actual
knowledge, is as of the Closing Date, in good repair, free and clear of any
damage that would materially and adversely affect its value as security for such
Mortgage Loan. If an engineering report revealed any material damage or
deficiencies, material deferred maintenance or other similar conditions either
(1) an escrow of funds was required or a letter of credit was obtained in an
amount sufficient to effect the necessary repairs or maintenance or (2) such
repairs and maintenance have been completed. To Seller's knowledge, as of
origination of such Mortgage Loan, there was no proceeding pending, and, to the
Seller's actual knowledge, no such proceeding for the condemnation of all or any
material portion of the Mortgaged
C-3
Property securing any Mortgage Loan has been noticed or commenced. As of the
date of the origination of each Mortgage Loan: (a) all of the material
improvements on the related Mortgaged Property lay wholly within the boundaries
and, to the extent in effect at the time of construction, building restriction
lines of such property, except for encroachments that are insured against by the
lender's title insurance referred to in Paragraph 8 below or that do not
materially and adversely affect the value or marketability of such Mortgaged
Property, and (b) no improvements on adjoining properties materially encroached
upon such Mortgaged Property so as to materially and adversely affect the value
or marketability of such Mortgaged Property, except those encroachments that are
insured against by the lender's title insurance referred to in Paragraph 8
below.
8. Title Insurance. The lien of each Mortgage securing a Mortgage Loan
is insured by an American Land Title Association (or an equivalent form of)
lender's title insurance policy (the "Title Policy") (except that if such policy
is yet to be issued, such insurance may be evidenced by a "marked up" pro forma
policy or title commitment in either case marked as binding and countersigned by
the title company or its authorized agent, either on its face or by an
acknowledged closing instruction or escrow letter) in the original principal
amount of such Mortgage Loan after all advances of principal, insuring the
originator of the related Mortgage Loan, its successors and assigns (as the sole
insured) that the related Mortgage is a valid first priority lien on such
Mortgaged Property, subject only to the Permitted Encumbrances. Such Title
Policy (or, if it has yet to be issued, the coverage to be provided thereby) is
in full force and effect, all premiums thereon have been paid, and Seller has
made no claims thereunder and, to Seller's actual knowledge, no prior holder of
the related Mortgage has made any claims thereunder and no claims have been paid
thereunder. Seller has not, and to the Seller's actual knowledge, no prior
holder of the related Mortgage has done, by act or omission, anything that would
materially impair the coverage under such Title Policy. Immediately following
the transfer and assignment of the related Mortgage Loan to the Trustee
(including endorsement and delivery of the related Mortgage Note to the
Purchaser and recording of the related Assignment of Mortgage in favor of
Purchaser in the applicable real estate records), such Title Policy (or, if it
has yet to be issued, the coverage to be provided thereby) will inure to the
benefit of the Trustee without the consent of or notice to the insurer. Such
Title Policy contains no exclusion for, or it affirmatively insures (unless, in
the case of clause (b) below, the related Mortgaged Property is located in a
jurisdiction where such affirmative insurance is not available), (a) access to a
public road, and (b) that the area shown on the survey, if any, reviewed or
prepared in connection with the origination of the related Mortgage Loan is the
same as the property legally described in the related Mortgage.
9. No Holdback. The proceeds of each Mortgage Loan have been fully
disbursed (except in those cases where the full amount of the Mortgage Loan has
been disbursed but a portion thereof is being held in escrow or reserve accounts
pending the satisfaction of certain conditions relating to leasing, repairs or
other matters with respect to the related Mortgaged Property), and there is no
obligation for future advances with respect thereto. Any and all requirements
under each Mortgage Loan as to completion of any on-site or off-site improvement
and as to disbursements of any funds escrowed for such purpose, which
requirements were to have been complied with on or before the Closing Date, have
been complied with in all material aspects or any such funds so escrowed have
not been released, provided that, partial releases of such funds in accordance
with the applicable Mortgage Loan
C-4
Documents may have occurred.
10. Mortgage Provisions. The Mortgage Note, Mortgage and Assignment of
Leases for each Mortgage Loan, together with applicable state law, contain
customary and, subject to the exceptions and limitations set forth in Paragraph
13 below, enforceable provisions for commercial or multifamily, as applicable,
mortgage loans such as to render the rights and remedies of the holder thereof
adequate for the practical realization against the related Mortgaged Property of
the principal benefits of the security intended to be provided thereby.
11. Trustee under Deed of Trust. If the Mortgage for any Mortgage Loan
is a deed of trust, then (a) a trustee, duly qualified under applicable law to
serve as such, has either been properly designated and currently so serves or
may be substituted in accordance with the Mortgage and applicable law, and (b)
no fees or expenses are payable to such trustee by the Seller, the Depositor or
any transferee thereof except in connection with a trustee's sale after default
by the related Borrower or in connection with any full or partial release of the
related Mortgaged Property or related security for such Mortgage Loan and all
such fees and expenses are the obligation of the Borrower under the Mortgage.
12. Environmental Conditions. Except in the case of the Mortgaged
Properties identified on Schedule C-12(TS) (as to which a transaction screen
meeting the requirements of the American Society for Testing and Materials, in
effect at the time the related report was prepared, for transaction screens
("Transaction Screen") was performed), (a) an environmental site assessment
meeting the requirements of the American Society for Testing and Materials in
effect at the time the related report was prepared and covering all
environmental hazards typically assessed for similar properties including use,
type and tenants of the Mortgaged Property ("Environmental Report"), or an
update of such an assessment, was performed by an independent and licensed (to
the extent required by applicable state law) environmental consulting firm with
respect to each Mortgaged Property securing a Mortgage Loan in connection with
the origination of such Mortgage Loan and thereafter updated such that, except
as set forth on Schedule C-12(a), such Environmental Report is dated no earlier
than twelve months prior to the Closing Date, (b) a copy of each such
Environmental Report has been delivered to the Purchaser, and (c) either: (i) no
such Environmental Report provides that as of the date of the report there is a
material violation of any applicable environmental laws with respect to any
circumstances or conditions relating to the related Mortgaged Property; or (ii)
if any such Environmental Report does reveal any such circumstances or
conditions with respect to the related Mortgaged Property and the same have not
been subsequently remediated in all material respects, then, except as described
on Schedule C-12(c), one or more of the following are true -- (A) a party not
related to the related Borrower with financial resources reasonably estimated to
be adequate to cure the subject violation in all material respects was
identified as the responsible party for such condition or circumstance and such
condition or circumstance does not materially impair the value of the Mortgaged
Property, (B) the related Borrower was required to provide additional security
reasonably estimated to be adequate to cure the subject violation in all
material respects and/or to obtain an operations and maintenance plan, (C) the
related Borrower, or other responsible party, provided a "no further action"
letter or other evidence reasonably acceptable to a reasonably prudent
commercial mortgage lender that applicable federal, state or local governmental
authorities had no current intention of taking any action, and are not requiring
any action, in respect of such condition or circumstance, (D) such conditions or
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circumstances were investigated further and based upon such additional
investigation, an independent environmental consultant recommended no further
investigation or remediation, (E) the expenditure of funds reasonably estimated
to be necessary to effect such remediation is not greater than 2% of the
outstanding principal balance of the related Mortgage Loan, (F) there exists an
escrow of funds reasonably estimated to be sufficient for purposes of effecting
such remediation, (G) the related Mortgaged Property is identified on Schedule
C-12(G) and insured under a policy of insurance against losses arising from such
circumstances and conditions or (H) a party with financial resources reasonably
estimated to be adequate to cure the subject violation in all material respects
provided a guaranty or indemnity to the related Borrower to cover the costs of
any required investigation, testing, monitoring or remediation. To the Seller's
actual knowledge, there are no significant or material circumstances or
conditions with respect to any Mortgaged Property not revealed in any such
Environmental Report, where obtained, or in any Borrower questionnaire delivered
to Seller at the issue of any related environmental insurance policy, if
applicable, that render such Mortgaged Property in material violation of any
applicable environmental laws. The Mortgage, or other loan document in the
Mortgage File, for each Mortgage Loan encumbering the Mortgaged Property
requires the related Borrower to comply with all applicable federal, state and
local environmental laws and regulations. The Seller has not taken any action
which would cause the Mortgaged Property not to be in compliance with all
federal, state and local laws pertaining to environmental hazards or which could
subject the Seller or its successors and assigns to liability under such laws.
Each Borrower represents and warrants in the related Mortgage Loan documents
generally to the effect that except as set forth in certain specified
environmental reports and to the best of its knowledge, as of the date of
origination of such Mortgage Loan, there were no hazardous materials on the
related Mortgaged Property, except those in full compliance with all applicable
Hazardous Materials Laws and the Borrower will not use, cause or permit to exist
on the related Mortgaged Property any hazardous materials in any manner which
violates federal, state or local laws, ordinances, regulations, orders,
directives, or policies governing the use, storage, treatment, transportation,
manufacture, refinement, handling, production or disposal of hazardous
materials. The related Borrower (or an affiliate thereof) has agreed to
indemnify, defend and hold the Seller and its successors and assigns harmless
from and against, or otherwise be liable for, any and all losses resulting from
a breach of environmental representations, warranties or covenants given by the
Borrower in connection with such Mortgage Loan, generally including any and all
losses, liabilities, damages, injuries, penalties, fines, expenses and claims of
any kind or nature whatsoever (including without limitation, attorneys' fees and
expenses) paid, incurred or suffered by or asserted against, any such party
resulting from such breach. If the Mortgaged Property is a multifamily
residential property and the environmental consultant, in its judgement in
consideration of the age, history or location of the mortgaged property,
considered lead-based paint, asbestos or radon to be a potential environmental
risk, then either (I) Operations and Maintenance Plans ("O&M Plans"), as
appropriate, were obtained and implemented prior to closing or an amount
sufficient to obtain and implement such O&M Plan(s) was held back at closing,
with the O&M Plan(s) required to be obtained and implemented post-closing, or
(II) an environmental assessment for lead-based paint, asbestos or radon, as
appropriate, was conducted and either (i) no further action was recommended,
(ii) O&M Plans or remediation were recommended and obtained or performed prior
to the loan closing, or (iii) O&M Plans or remediation were recommended and
escrows sufficient to obtain such O&M Plans or effect such remediation were held
back at closing with the O&M Plan(s) or remediation required to be obtained or
performed post-closing.
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13. Loan Document Status. Each Mortgage Note, Mortgage, and other
agreement executed by or on behalf of the related Borrower, or any guarantor of
non-recourse exceptions and environmental liability, with respect to each
Mortgage Loan is the legal, valid and binding obligation of the maker thereof
(subject to any non-recourse provisions contained in any of the foregoing
agreements and any applicable state anti-deficiency or market value limit
deficiency legislation), enforceable in accordance with its terms, except as
such enforcement may be limited by: (i) bankruptcy, insolvency, reorganization,
fraudulent transfer and conveyance or other similar laws affecting the
enforcement of creditors' rights generally and (ii) general principles of equity
(regardless of whether such enforcement is considered in a proceeding in equity
or at law), and except that certain provisions in such loan documents may be
further limited or rendered unenforceable by applicable law, but (subject to the
limitations set forth in the foregoing clauses (i) and (ii)) such limitations
will not render such loan documents invalid as a whole or substantially
interfere with the mortgagee's realization of the principal benefits and/or
security provided thereby. There is no right of rescission, offset, abatement,
diminution or valid defense or counterclaim available to the related Borrower
with respect to such Mortgage Note, Mortgage or other agreements that would deny
the mortgagee the principal benefits intended to be provided thereby. Seller has
no actual knowledge of any such rights, defenses or counterclaims having been
asserted.
14. Insurance. Except in certain cases, where tenants, having a net
worth of at least $50,000,000 or an investment grade credit rating and obligated
to maintain the insurance described in this paragraph, are allowed to
self-insure the related Mortgaged Properties, all improvements upon each
Mortgaged Property securing a Mortgage Loan are insured under a fire and
extended perils included within the classification "All Risk of Physical Loss"
or "Extended Coverage" insurance (or the equivalent) policy in an amount at
least equal to the lesser of (i) the outstanding principal balance of such
Mortgage Loan and (ii) 100% of the full insurable value, or 100% of the
replacement cost, of the improvements located on the related Mortgaged Property,
and if applicable, the related hazard insurance policy contains appropriate
endorsements to avoid the application of co-insurance and does not permit
reduction in insurance proceeds for depreciation. Except as identified on
Schedule C-14 hereto, each Mortgaged Property securing a Mortgage Loan is the
subject of a business interruption or rent loss insurance policy providing
coverage for at least twelve (12) months (or a specified dollar amount which is
reasonably estimated to cover no less than twelve (12) months of rental income).
If any portion of the improvements on a Mortgaged Property securing any Mortgage
Loan was, at the time of the origination of such Mortgage Loan, in an area
identified in the Federal Register by the Flood Emergency Management Agency as a
special flood hazard area (Zone A or Zone V) (an "SFH Area") and flood insurance
was available, a flood insurance policy meeting the requirements of the then
current guidelines of the Federal Insurance Administration is in effect with a
generally acceptable insurance carrier, in an amount representing coverage not
less than the least of (1) the minimum amount required, under the terms of
coverage, to compensate for any damage or loss on a replacement basis of the
improvements in the SFH Area, (2) the outstanding principal balance of such
Mortgage Loan, and (3) the maximum amount of insurance available under the
applicable National Flood Insurance Administration Program. Each Mortgaged
Property and all improvements thereon are also covered by comprehensive general
liability insurance in such amounts as are generally required by reasonably
prudent commercial lenders for similar properties. If the Mortgaged Property is
located within 25 miles of the coast of Florida, Texas, Louisiana, Mississippi,
Alabama, Georgia, North Carolina or South Carolina, such Mortgaged
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Property is covered by windstorm insurance in such amount as is generally
required by reasonably prudent commercial or multifamily, as applicable, lenders
for similar properties or mitigating factors exist which would be satisfactory
to reasonably prudent commercial or multifamily, as applicable, lenders for
similar properties. If the Mortgaged Property is located in the State of
California or in a "seismic zone" 3 or 4, a seismic assessment was conducted at
the time of origination or, alternatively, prior to the Closing Date and seismic
insurance in an amount which would be acceptable to a reasonably prudent
commercial lender was obtained to the extent such Mortgaged Property has a PML
of greater than twenty percent (20%) (based on a 450-year lookback with a 10%
probability of exceedance in a 50-year period). Any Mortgaged Property
constituting a materially non-conforming use under applicable zoning laws and
ordinances constitutes a legal non-conforming use which, in the event of
casualty or destruction, may be restored or repaired to materially the same
extent of the use or structure at the time of such casualty or such Mortgaged
Property is covered by law and ordinance insurance in an amount as would be
customarily required by a reasonably prudent commercial or multifamily, as
applicable, mortgage lender or a zoning endorsement, in form, substance and
amount as would be customarily required by a reasonably prudent commercial or
multifamily, as applicable, mortgage lender, insuring against loss to the
mortgagee resulting from such non-conformity was obtained or the insurance
proceeds available under the required casualty insurance plus the value of the
land and any remaining improvements will be sufficient to repay the Mortgage
Loan. Additionally, for any Mortgage Loan having a Cut-off Date Principal
Balance equal to or greater than $20,000,000, the insurer for all of the
required coverages set forth herein has a claims paying ability rating from
Standard & Poor's, Xxxxx'x or Fitch of not less than A-minus (or the
equivalent), or from A.M. Best of not less than "A:V" (or the equivalent). All
such insurance policies contain a standard mortgagee clause for the benefit of
the holder of the related Mortgage, its successors and assigns, as mortgagee,
and are not terminable (nor may the amount of coverage provided thereunder be
reduced) without thirty (30) days' prior written notice to the mortgagee; and no
such notice has been received, including any notice of nonpayment of premiums,
that has not been cured and all such insurance is in full force and effect. With
respect to each Mortgage Loan, the related Mortgage requires that the related
Borrower or a tenant of such Borrower maintain insurance as described above or
permits the Mortgagee to require insurance as described above. Except under
circumstances, including certain minimum thresholds, that would be reasonably
acceptable to a prudent commercial or multifamily, as applicable, mortgage
lender or that would not otherwise materially and adversely affect the security
intended to be provided by the related Mortgage, the Mortgage for each Mortgage
Loan provides that proceeds paid under any such casualty insurance policy will
(or, at the lender's option, will) be applied either to the repair or
restoration of the related Mortgaged Property or to the payment of amounts due
under such Mortgage Loan; provided that the related Mortgage may entitle the
related Borrower to any portion of such proceeds remaining after the repair or
restoration of the related Mortgaged Property or payment of amounts due under
the Mortgage Loan; and provided, further, that, if the related Borrower holds a
leasehold interest in the related Mortgaged Property, the application of such
proceeds will be subject to the terms of the related Ground Lease (as defined in
Paragraph 18 below). To Seller's actual knowledge, all insurance policies
described above are with an insurance carrier qualified to write insurance in
the relevant jurisdiction.
15. Taxes and Assessments. As of the origination of the Mortgage Loan
or October 1, 2001, whichever is later, there were no, and as of the Closing
Date, the Seller has no
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knowledge of, any delinquent property taxes or assessments or other outstanding
charges affecting any Mortgaged Property securing a Mortgage Loan that are not
otherwise covered by an escrow of funds sufficient to pay such charge. For
purposes of this representation and warranty, real property taxes and
assessments shall not be considered delinquent until the date on which interest
and/or penalties would be payable thereon.
16. Borrower Bankruptcy. No Mortgaged Property is the subject of, and
no Borrower under a Mortgage Loan is a debtor in any state or federal
bankruptcy, insolvency or similar proceeding.
17. Local Law Compliance. To the Seller's knowledge at the time of the
origination of such Mortgage Loan, based upon a letter from governmental
authorities, a legal opinion, a zoning consultant's report or an endorsement to
the related Title Policy, and to Seller's actual knowledge as of the Closing
Date, except as described on Schedule C-17, the improvements located on or
forming part of, and the existing use of, each Mortgaged Property securing a
Mortgage Loan was or are in material compliance with applicable zoning laws and
ordinances or constitute a legal non-conforming use or structure (or, if any
such improvement does not so comply and does not constitute a legal
non-conforming use or structure, such non-compliance and failure does not
materially and adversely affect the value of the related Mortgaged Property as
determined by the appraisal performed in connection with the origination of such
Mortgage Loan or as otherwise reasonably determined by the Seller in a manner
that would be acceptable to a reasonably prudent commercial or multifamily, as
applicable, mortgage lender).
18. Leasehold Estate Only. If any Mortgage Loan is secured, in whole or
in part, by the interest of a Borrower as a lessee under a ground lease
(together with any and all written amendments and modifications thereof and any
and all estoppels from or other agreements with the ground lessor, a "Ground
Lease"), but not by the related fee interest in such property (the "Fee
Interest"), then, except as otherwise specified on Schedule C-18:
(a) Such Ground Lease or a memorandum thereof has been or will
be duly recorded; such Ground Lease permits the interest of the lessee
thereunder to be encumbered by the related Mortgage and does not
restrict the use of the related Mortgaged Property by such lessee, its
successors or assigns in a manner that would materially adversely
affect the security provided by the related Mortgage; and there has
been no material change in the terms of such Ground Lease since its
recordation, with the exception of material changes reflected in
written instruments which are a part of the related Mortgage File;
(b) The related lessee's leasehold interest in the portion of
the related Mortgaged Property covered by such Ground Lease is not
subject to any liens or encumbrances superior to, or of equal priority
with, the related Mortgage, other than Permitted Encumbrances, and such
Ground Lease, provides that it shall remain superior to any mortgage or
other lien upon the related Fee Interest;
(c) The Borrower's interest in such Ground Lease is assignable
to, and is thereafter further assignable by, the Purchaser upon notice
to, but without the consent of,
C-9
the lessor thereunder (or, if such consent is required, it has been
obtained); provided that such Ground Lease has not been terminated and
all defaults, if any, on the part of the related lessee have been
cured;
(d) Such Ground Lease is in full force and effect and the
Seller has not received any notice that any material default has
occurred under such Ground Lease, and the lessor under such Ground
Lease has been sent notice of the lien evidenced by the Mortgage in
accordance with the terms of the Ground Lease;
(e) Such Ground Lease requires the lessor thereunder to give
notice of any default by the lessee to the mortgagee under such
Mortgage Loan. Furthermore, such Ground Lease further provides that no
notice of termination given under such Ground Lease is effective
against the mortgagee under such Mortgage Loan unless a copy has been
delivered to such mortgagee in the manner described in such Ground
Lease;
(f) The mortgagee under such Mortgage Loan is permitted a
reasonable opportunity (including, where necessary, sufficient time to
gain possession of the interest of the lessee under such Ground Lease)
to cure any default under such Ground Lease, which is curable after the
receipt of notice of any such default, before the lessor thereunder may
terminate such Ground Lease;
(g) Such Ground Lease has an original term (or an original
term plus options exercisable by the holder of the related Mortgage)
which extends not less than twenty (20) years beyond the end of the
amortization term of such Mortgage Loan;
(h) Such Ground Lease requires the lessor to enter into a new
lease with a mortgagee upon termination of such Ground Lease as a
result of a rejection of such Ground Lease in a bankruptcy proceeding
involving the related Borrower unless the mortgagee under such Mortgage
Loan fails to cure a default of the lessee under such Ground Lease
following notice thereof from the lessor;
(i) Under the terms of such Ground Lease and the related
Mortgage, taken together, any casualty insurance proceeds, other than
de minimus amounts for minor casualties, with respect to the leasehold
interest will be applied either: (i) to the repair or restoration of
all or part of the related Mortgaged Property, with the mortgagee or a
trustee appointed by it having the right to hold and disburse such
proceeds as the repair or restoration progresses (except in such cases
where a provision entitling another party to hold and disburse such
proceeds would not be viewed as commercially unreasonable by a prudent
commercial mortgage lender), or (ii) to the payment of the outstanding
principal balance of the Mortgage Loan together with any accrued
interest thereon. Under the terms of the Ground Lease and the related
Mortgage, taken together, any condemnation proceeds or awards in
respect of a total or substantially total taking will be applied first
to the payment of the outstanding principal and interest on the
Mortgage Loan (except as otherwise provided by applicable law and
subject to any rights to require the improvements to be rebuilt);
C-10
(j) Such Ground Lease does not impose any restrictions on
subletting which would be viewed as commercially unreasonable by a
prudent commercial or multifamily, as applicable, mortgage lender in
the lending area where the Mortgaged Property is located at the time of
the origination of such Mortgage Loan;
(k) The lessor under such Ground Lease is not permitted to
disturb the possession, interest or quiet enjoyment of the lessee in
the relevant portion of the Mortgaged Property subject to such Ground
Lease for any reason, or in any manner, which would materially
adversely affect the security provided by the related Mortgage; and
(l) Such Ground Lease may not be materially amended or
modified without the prior consent of the mortgagee under such Mortgage
Loan, and any such action without such consent is not binding on such
mortgagee, its successors or assigns.
19. Qualified Mortgage. Such Mortgage Loan is a "qualified
mortgage" within the meaning of Section 860G(a)(3) of the Code and Treasury
regulation section 1.860G-2(a) and the related Mortgaged Property, if acquired
by a REMIC in connection with the default or imminent default of such Mortgage
Loan, would constitute "foreclosure property" within the meaning of Section
860G(a)(8).
20. Advancement of Funds. The Seller has not advanced funds or
induced, solicited or knowingly received any advance of funds from a party other
than the owner of the related Mortgaged Property or the related Borrower (other
than amounts paid by the tenant as specifically provided under related lease or
by a property manager), for the payment of any amount required by such Mortgage
Loan, except for interest accruing from the date of origination of such Mortgage
Loan or the date of disbursement of the Mortgage Loan proceeds, whichever is
later, to the date which preceded by 30 days the first due date under the
related Mortgage Note.
21. No Equity Interest, Equity Participation or Contingent
Interest. No Mortgage Loan contains any equity participation by the mortgagee
thereunder, is convertible by its terms into an equity ownership interest in the
related Mortgaged Property or the related Borrower, has a shared appreciation
feature, provides for any contingent or additional interest in the form of
participation in the cash flow of the related Mortgaged Property, or, provides
for interest-only payments without principal amortization, other than for the
initial partial month period between the date of the origination of such
Mortgage Loan and the first day of the immediately succeeding month, or for the
negative amortization of interest, except that, in the case of an ARD Loan, such
Mortgage Loan provides that, during the period commencing on or about the
related Anticipated Repayment Date and continuing until such Mortgage Loan is
paid in full, (a) additional interest shall accrue and may be compounded monthly
and shall be payable only after the outstanding principal of such Mortgage Loan
is paid in full, and (b) subject to available funds, a portion of the cash flow
generated by such Mortgaged Property will be applied each month to pay down the
principal balance thereof in addition to the principal portion of the related
Monthly Payment. Neither Seller nor any affiliate thereof has any obligation to
make any capital contribution to the Borrower under the Mortgage Loan or
otherwise.
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22. Legal Proceedings. To Seller's knowledge, as of
origination there were no, and to the Seller's actual knowledge, as of the
Closing Date, there are no pending actions, suits, litigation or other
proceedings by or before any court or governmental authority against or
affecting the Borrower (or any related guarantor to the extent the Seller in
accordance with Seller's underwriting standards would consider such guarantor
material to the underwriting of such Mortgage Loan) under any Mortgage Loan or
the related Mortgaged Property that, if determined adversely to such Borrower or
Mortgaged Property, would materially and adversely affect the value of the
Mortgaged Property as security for such Mortgage Loan, the Borrower's ability to
pay principal, interest or any other amounts due under such Mortgage Loan or the
ability of any such guarantor to meet its obligations.
23. Other Liens. Except as otherwise set forth on Schedule
C-23, none of the Mortgage Loans permits the related Mortgaged Property or any
interest therein or any controlling ownership interest in the Borrower
(including, but not limited to, any controlling interest in the manager or
managing member of a Borrower which is a limited liability company or the
general partner of a Borrower which is a general partnership, limited
partnership or limited liability partnership) to be encumbered by any mortgage
lien or other encumbrance except the related Mortgage or the Mortgage of another
Mortgage Loan without the prior written consent of the holder thereof or the
satisfaction of debt service coverage or similar criteria specified therein. To
Seller's knowledge, as of origination, and, to the Seller's actual knowledge as
of the Closing Date, except for cases involving other Mortgage Loans, none of
the Mortgaged Properties securing the Mortgage Loans is encumbered by any
mortgage liens junior to or of equal priority with the liens of the related
Mortgage. The Mortgage requires the Borrower to pay all reasonable costs and
expenses related to any required consent to an encumbrance, including reasonable
legal fees and expenses and any applicable Rating Agency fees.
24. No Mechanics' Liens. To Seller's knowledge, as of the
origination of the Mortgage Loan, and, to the Seller's actual knowledge, as of
the Closing Date: (i) each Mortgaged Property securing a Mortgage Loan
(exclusive of any related personal property) is free and clear of any and all
mechanics' and materialmen's liens that are prior or equal to the lien of the
related Mortgage and that are not bonded or escrowed for or covered by title
insurance; and (ii) no rights are outstanding that under law could give rise to
any such lien that would be prior or equal to the lien of the related Mortgage
and that is not bonded or escrowed for or covered by title insurance.
25. Compliance with Usury Laws. Each Mortgage Loan complied
with, or was exempt from, all applicable usury laws in effect at its date of
origination.
26. Licenses and Permits. To the extent required by applicable
law, each Mortgage Loan requires the related Borrower to be qualified to do
business, and requires the related Borrower and the related Mortgaged Property
to be in material compliance with all regulations, licenses, permits,
authorizations, restrictive covenants and zoning and building laws, in each case
to the extent required by law or to the extent that the failure to be so
qualified or in compliance would have a material and adverse effect upon the
enforceability of the Mortgage Loan or upon the practical realization against
the related Mortgaged Property of the principal benefits of the security
intended to be provided thereby. To the Seller's knowledge, as of the date of
origination of each Mortgage Loan and based on any of: (i) a letter from
governmental
C-12
authorities, (ii) a legal opinion, (iii) an endorsement to the related Title
Policy, (iv) a zoning report from a zoning consultant, or (v) other due
diligence that the originator of the Mortgage Loan customarily performs in the
origination of comparable mortgage loans, the related Borrower was in possession
of all material licenses, permits and franchises required by applicable law for
the ownership and operation of the related Mortgaged Property as it was then
operated or such material licenses, permits and franchises have otherwise been
issued.
27. Cross-Collateralization. No Mortgage Loan is
cross-collateralized with any loan which is outside the Mortgage Pool.
28. Releases of Mortgaged Properties. Except as set forth on
Schedule C-28, no Mortgage Note or Mortgage requires the mortgagee to release
all or any material portion of the related Mortgaged Property from the lien of
the related Mortgage except upon: (i) payment in full of all amounts due under
the related Mortgage Loan or (ii) delivery of "government securities", as
defined Treasury regulation section 1.860G-2(a)(8)(i), in connection with a
defeasance of the related Mortgage Loan; provided that the Mortgage Loans that
are Cross-Collateralized Mortgage Loans, and the other individual Mortgage Loans
secured by multiple parcels, may require the respective mortgagee(s) to grant
releases of material portions of the related Mortgaged Property or the release
of one or more related Mortgaged Properties upon: (i) the satisfaction of
certain legal and underwriting requirements which would be acceptable to a
reasonably prudent commercial or multifamily, as applicable, mortgage lender, or
(ii) the payment of a release price equal to at least 125% of the loan amount
allocated to such Mortgaged Property or the appraised value of such Mortgaged
Property at the time of the release and prepayment consideration in connection
therewith.
29. Defeasance. With respect to any Mortgage Loan that
contains a provision for any defeasance of mortgage collateral (a "Defeasance
Loan"), the related Mortgage Note, Mortgage or other related loan document
contained in the Mortgage File, provides that the defeasance option is not
exercisable prior to a date that is at least two (2) years following the Closing
Date and is otherwise in compliance with applicable statutes, rules and
regulations governing REMICs; requires prior written notice to the holder of the
Mortgage Loan of the exercise of the defeasance option and payment by Borrower
of all related reasonable fees, costs and expenses as set forth below; requires,
or permits the lender to require, the Mortgage Loan (or the portion thereof
being defeased) to be assumed by a single-purpose entity; and requires delivery
of a legal opinion that the Trustee has a perfected security interest in such
collateral prior to any other claim or interest. In addition, each Mortgage loan
that is a Defeasance Loan permits defeasance only with substitute collateral
constituting non-callable "government securities" within the meaning of Treasury
regulation section 1.860G-2(a)(8)(i) in an amount sufficient to make all
scheduled payments under the Mortgage Note (or the portion thereof being
defeased) when due, and in the case of ARD Loans, assuming the Anticipated
Repayment Date is the Maturity Date. To Seller's actual knowledge, defeasance
under the Mortgage Loan is only for the purpose of facilitating the disposition
of a Mortgaged Property and not as part of an arrangement to collateralize a
REMIC offering with obligations that are not real estate mortgages. With respect
to each Defeasance Loan, the related Mortgage or other related loan document
provides that the related Borrower shall (a) pay all Rating Agency fees
associated with defeasance (if Rating Agency approval is a specific condition
precedent thereto) and all other reasonable expenses associated with defeasance,
including, but not limited to, accountant's fees
C-13
and opinions of counsel, or (b) provide all opinions required under the related
loan documents, including, if applicable, a REMIC opinion and a perfection
opinion and any applicable rating agency letters confirming no downgrade or
qualification of ratings on any classes in the transaction. Additionally, for
any Mortgage Loan having a Cut-off Date Principal Balance equal to or greater
than $20,000,000, the Mortgage Loan or the related documents require
confirmation from the Rating Agency that exercise of the defeasance option will
not cause a downgrade or withdrawal of the rating assigned to any securities
backed by the Mortgage Loan and require the Borrower to pay any Rating Agency
fees and expenses.
30. Fixed Rate Loans. Each Mortgage Loan bears interest at a
rate that remains fixed throughout the remaining term of such Mortgage Loan,
except in the case of an ARD Loan after its Anticipated Repayment Date and
except for the imposition of a default rate.
31. Inspection. The Seller, or an affiliate, inspected, or
caused the inspection of, the related Mortgaged Property within twelve (12)
months of the Closing Date.
32. No Material Default. There exists no material default,
breach, violation or event of acceleration under the Mortgage Note, Mortgage or
other related loan documents for any Mortgage Loan and, to Seller's actual
knowledge, no event or circumstance which, with the passage of time or notice
and expiration of any grace period or cure period, would constitute a material
default, breach, violation or event of acceleration under such Mortgage Note,
Mortgage or other related loan documents; provided, however, that this
representation and warranty does not cover any default, breach, violation or
event of acceleration that pertains to or arises directly out of the subject
matter of or is covered by any other representation and warranty made by the
Seller in this Exhibit C. No foreclosure or other enforcement action has been
taken by the Seller or, to the Seller's knowledge, by any prior holder of such
Mortgage Loan, against the Borrower or the Mortgaged Property with respect to
the subject Mortgage Loan.
33. Due-on-Sale. The Mortgage contains a "due on sale" clause,
which provides for the acceleration of the payment of the unpaid principal
balance of the Mortgage Loan if, without the prior written consent of the holder
of the Mortgage, either the related Mortgage Property, or any controlling
interest in the related Borrower (including, but not limited to, any controlling
interest in the manager or managing member of a Borrower which is a limited
liability company or the general partner of a Borrower which is a general
partnership, limited partnership or limited liability partnership) is pledged,
transferred or sold, other than by reason of family and estate planning
transfers (or by devise, descent or operation of law upon the death of a member,
partner or shareholder of the related Borrower), transfers of less than a
controlling interest in the Borrower, issuance of non-controlling new equity
interests, transfers to an affiliate meeting the requirements of the Mortgage
Loan, transfers among existing members, partners or shareholders in the
Borrower, transfers among affiliated Borrowers with respect to
cross-collateralized Mortgaged Loans or multi-property Mortgage Loans or
transfers of a similar nature to the foregoing meeting the requirements of the
Mortgage Loan. The Mortgage requires the Borrower to pay all reasonable fees and
expenses associated with securing the consent or approval of the holder of the
Mortgage for all actions requiring such consent or approval under the Mortgage
including the cost of any required counsel opinions relating to REMIC or other
securitization and tax issues and any applicable Rating Agency fees.
C-14
34. Single Purpose Entity. Each Mortgage Loan with an original
principal balance over $5,000,000 requires the Borrower to be for at least for
so long as the Mortgage Loan is outstanding, and to Seller's actual knowledge
each Borrower is, a Single-Purpose Entity. For this purpose, "Single-Purpose
Entity" means a person, other than an individual, which is formed or organized
solely for the purpose of owning and operating the related Mortgaged Property or
Properties; does not engage in any business unrelated to such Mortgaged Property
or Properties and the financing thereof; and whose organizational documents
provide, or which entity represented and covenanted in the related Mortgage Loan
documents, substantially to the effect that such Borrower (i) does not and will
not have any material assets other than those related to its interest in such
Mortgaged Property or Properties or the financing thereof; (ii) does not and
will not have any indebtedness other than as permitted by the related Mortgage
or other related Mortgage Loan Documents; (iii) maintains its own books, records
and accounts, in each case which are separate and apart from the books, records
and accounts of any other person; and (iv) holds itself out as being a legal
entity, separate and apart from any other person. In addition with respect to
all Mortgage Loans with an original principal balance of $15,000,000 or more,
the Borrower's organizational documents provide substantially to the effect that
the Borrower shall: conduct business in its own name; not guarantee or assume
the debts or obligations of any other person; not commingle its assets or funds
with those of any other person; prepare separate tax returns and financial
statements, or if part of a consolidated group, be shown as a separate member of
such group; transact business with affiliates on an arm's length basis pursuant
to written agreements; hold itself out as being a legal entity, separate and
apart from any other person and such organizational documents provide that: any
dissolution and winding up or insolvency filing for such entity is prohibited or
requires the unanimous consent of an independent director or member or all
partners or members, as applicable; such documents may not be amended with
respect to the Single-Purpose Entity requirements without the approval of the
mortgagee or rating agencies; the Borrower shall have an outside independent
director or member. There was obtained for each such Mortgage Loan having an
original principal balance of $20,000,000 a counsel's opinion regarding
non-consolidation of the Borrower in any insolvency proceeding involving any
other party. To Seller's actual knowledge, each Borrower has complied in all
material respects with the requirements of the related Mortgage Loan and
Mortgage and the Borrower's organizational documents regarding
Single-Purpose-Entity status. The organization documents of any Borrower on a
Mortgage Loan having an original principal balance of $15,000,000 or more which
is a single member limited liability company provide that the Borrower shall not
dissolve or liquidate upon the bankruptcy, dissolution, liquidation or death of
the sole member. Any such single member limited liability company Borrower is
organized in jurisdictions that provide for such continued existence and there
was obtained an opinion of such Borrower's counsel confirming such continued
existence and that the applicable law provides that creditors of the single
member may only attach the assets of the member including the membership
interests in the Borrower but not the assets of the Borrower.
35. Whole Loan. Each Mortgage loan is a whole loan and not a
participation interest in a mortgage loan.
36. Tax Parcels. Each Mortgaged Property either (i)
constitutes one or more complete separate tax lots containing no other property
or (ii) is subject to an endorsement under the related lender title policy
insuring same or (iii) an application for the creation of separate tax lots
complying in all respects with the applicable laws and requirements of the
applicable
C-15
governing authority has been made and approved by the applicable governing
authority and such separate tax lots shall be effective for the next tax year.
37. ARD Loans. Each Mortgage Loan which is an ARD Loan
commenced amortizing on its initial scheduled Due Date, and provides that: (i)
its Mortgage Rate will increase by at least two (2) percentage points in
connection with the passage of its Anticipated Repayment Date; (ii) its
Anticipated Repayment Date is not less than seven (7) years following the
origination of such Mortgage Loan; (iii) no later than the related Anticipated
Repayment Date, the related Borrower is required (if it has not previously done
so) to enter into a "lockbox agreement" whereby all revenue from the related
Mortgaged Property shall be deposited directly into a designated account
controlled by the Master Servicer; and (iv) any net cash flow from the related
Mortgaged Property that is applied to amortize such Mortgage Loan following its
Anticipated Repayment Date shall, to the extent such net cash flow is in excess
of the scheduled principal and interest payment payable therefrom, be net of
budgeted and discretionary (servicer approved) capital expenditures.
38. Security Interests. The security agreements, financing
statements or other instruments, if any, related to the Mortgage Loan establish
and create, and a UCC financing statement has been filed and/or recorded in all
places required by applicable law for the perfection of (to the extent that the
filing of such a UCC financing statement can perfect such a security interest),
a valid security interest in the personal property granted under such Mortgage
(and any related security agreement), which in all cases includes elevators) and
all Borrower owned furniture, fixtures and equipment material to the Borrower's
operation of the Mortgaged Property and, if such Mortgaged Property is a hotel,
restaurant, healthcare facility, nursing home, assisted living facility,
self-storage facility, theatre, mobile home park or fitness center operated by
the related Borrower, such personal property, with the exception of certain
leased personal property for which there is an assignment of the Borrower's
interest, constitutes all the material personal property required to operate the
Borrower's business and any security agreement, chattel mortgage or equivalent
document related to and delivered in connection with the related Mortgage Loan
establishes and creates a valid and enforceable lien and first priority security
interest in such material personal property described therein (subject to the
exceptions and limitations set forth in Paragraph 13 above), except for certain
personal property subject to purchase money security interests or personal
property leases and security interests to secure revolving lines of credit, all
of which are in compliance with or allowable under the related Mortgage Loan
documents and are disclosed in the Mortgage Loan File or the Borrower's
financial statements or operating statements. In the case of each Mortgage Loan
secured by a hotel, the related loan documents contain such provisions as are
necessary and UCC Financing Statements have been filed as necessary, in each
case, to perfect a valid first priority security interest in the related
revenues with respect to such Mortgaged Property. An assignment of each UCC
financing statement relating to the Mortgage Loan has been executed by Seller in
blank which the Purchaser or Trustee, as applicable, or designee is authorized
to complete and to file in the filing office in which such financing statement
was filed. Each Mortgage Loan and the related Mortgage (along with any security
agreement and UCC financing statement), together with applicable state law,
contain customary and enforceable provisions such as to render the rights and
remedies of the holders thereof adequate for the practical realization against
the personal property described above, and the principal benefits of the
security intended to be provided thereby.
C-16
39. Environmental Insurance. If the Mortgaged Property
securing any Mortgage Loan is covered by a secured creditor policy, then:
(a) the Seller --
(i) has disclosed, or is aware that there has been
disclosed, in the application for such policy or
otherwise to the insurer under such policy the
"pollution conditions" (as defined in such policy)
identified in any environmental reports related to
such Mortgaged Property which are in the Seller's
possession or are otherwise known to the Seller; and
(ii) has delivered or caused to be delivered to the
insurer under such policy copies of all environmental
reports in the Seller's possession related to such
Mortgaged Property,
in each case with respect to (i) and (ii) to the extent required by
such policy or to the extent the failure to make any such disclosure or
deliver any such report would materially and adversely affect the
Purchaser's ability to recover under such policy;
(b) all premiums for such insurance have been paid;
(c) such insurance is in full force and effect; and
(d) such insurance policy has a term of not less than three
(3) years beyond the maturity date of the Mortgage Loan.
40. Prepayment Premiums and Yield Maintenance Charges.
Prepayment Premiums and Yield Maintenance Charges payable with respect to each
Mortgage Loan, if any, constitute "customary prepayment penalties" within
meaning of Treasury regulation section 1.860G-1(b)(2).
41. Operating Statements. Each Mortgage requires the Borrower
upon request to provide the owner or holder of the Mortgage with quarterly
(except for Mortgage Loans with an original principal balance less than
$3,000,000) and annual operating statements (or a balance sheet statement of
income and expenses and a statement of changes in financial position), rent
rolls (if there is more than one tenant) and related information and annual
financial statements, which annual financial statements for all Mortgage Loans
with an original principal balance greater than $20 million shall be audited by
an independent certified public accountant upon the request of the holder of the
Mortgage Loan.
42. Servicing Rights. Except as set forth on Schedule C-42
hereto and except as to the Master and Special Servicer, no Person has been
granted or conveyed the right to service any Mortgage Loan or receive any
consideration in connection therewith.
43. Recourse. Each Mortgage Loan is non-recourse, except that
the Borrower and in the case of a Mortgage Loan with an initial principal
balance of $3,000,000 or more, either: a principal of the Borrower who is a
natural person or other individual guarantor who is a natural person, with
assets other than any interest in the Borrower has agreed to be jointly and
C-17
severally liable for all liabilities, expenses, losses, damages, expenses or
claims suffered or incurred by the holder of the Mortgage Loan by reason of or
in connection with: (i) any fraud or material misrepresentation by the Borrower,
(ii) misapplication or misappropriation of rents, insurance payments,
condemnation awards, tenant security deposits or other funds subject to the
Mortgage, (iii) acts of material, physical waste (or, alternatively, the failure
to repair or restore the related Mortgaged Property in accordance with any
related Mortgage Loan document, to the extent not covered by insurance proceeds
paid on account of damage which is the subject of any such repair or restoration
which are made available for such purpose to the Borrower or the holder of the
Mortgage Loan) , (iv) violation of applicable environmental laws or breaches of
environmental covenants or (v) the related Mortgaged Property becoming an asset
in a voluntary bankruptcy or insolvency proceeding instituted by the Borrower,
that impairs the ability of the holder of the related Mortgage Loan to enforce
its lien on the related Mortgaged Property. With respect to clause (iv) in this
paragraph, environmental insurance meeting the requirements set forth in
Paragraph 39 shall satisfy such requirement. With respect to clause(v) in this
paragraph, such requirement will be satisfied if the related Mortgage Loan
documents provide that the non-recourse provisions of the Mortgage Loan
documents shall not be applicable to Borrower (and a principal of Borrower who
is a natural person or other individual guarantor who is a natural person shall
guaranty the Borrower's recourse obligations arising from such
non-applicability) either (a) in the event of a voluntary bankruptcy filing by
the Borrower or (b) to the extent the Mortgage Loan holder's rights of recourse
to the Mortgaged Property are impaired by or as a result of any legal proceeding
(including a voluntary bankruptcy or insolvency proceeding) instituted by the
Borrower. No waiver of liability for such non-recourse exceptions has been
granted to the Borrower or any such guarantor or principal by the Seller or
anyone acting on behalf of the Seller.
44. Assignment of Collateral. There is no material collateral
securing any Mortgage Loan that has not been assigned to the Purchaser.
45. Fee Simple or Leasehold Interests. The interest of the
related Borrower in the Mortgaged Property securing each Mortgage Loan includes
a fee simple and/or leasehold estate or interest in real property and the
improvements thereon.
46. Servicing. The servicing and collection practices used
with respect to each Mortgage Loan in all material respects have met customary
standards utilized by prudent commercial or multifamily, as applicable, mortgage
loan servicers with respect to whole loans.
47. Originator's Authorization To Do Business. To the extent
required under applicable law to assure the enforceability of a Mortgage Loan,
as of such Mortgage Loan's funding date and at all times when it held such
Mortgage Loan, the originator of such Mortgage Loan was authorized to do
business in the jurisdiction in which the related Mortgaged Property is located.
48. No Fraud In Origination. In the origination of the
Mortgage Loan, none of the Seller, the originator or any employee or agent of
the Seller or the originator, participated in any fraud or intentional material
misrepresentation with respect to the Borrower, the Mortgaged Property or any
guarantor. To Seller's actual knowledge, no Borrower or guarantor is guilty of
defrauding or making an intentional material misrepresentation to the Seller or
originator with
C-18
respect to the origination of the Mortgage Loan, the Borrower or the Mortgaged
Property.
49. Appraisal. An appraisal of the Mortgaged Property for each
Mortgage Loan was conducted in connection with the origination of such Mortgage
Loan, which appraisal is signed by an appraiser, who, to Seller's actual
knowledge, had no interest, direct or indirect, in the related Borrower, such
Mortgaged Property or in any loan made on the security of the Mortgaged
Property, and whose compensation is not affected by the approval or disapproval
of such Mortgage Loan; to the Seller's actual knowledge, the appraisal and
appraiser both satisfy the requirements of the "Uniform Standards of
Professional Appraisal Practice" as adopted by the Appraisal Standards Board of
the Appraisal Foundation, all as in effect on the date the Mortgage Loan was
originated.
50. Access and Parking. The following statements are true with
respect to each Mortgaged Property: (i) the Mortgaged Property is located on or
adjacent to a public road, or has access to an irrevocable easement permitting
ingress and egress and (ii) except for de minimus violations or legal
non-conforming parking, to the Seller's knowledge, as of the time of origination
of such Mortgage Loan, based upon a letter from governmental authorities, a
legal opinion, an independent zoning consultant's report or an endorsement to
the related title insurance policy insuring the holder of the Mortgage against
losses related to the lack of such parking, and to Seller's actual knowledge as
of the Closing Date, the Mortgaged Property has parking to the extent, if any,
required under applicable law, including local ordinances.
51. Jurisdiction of Organization. Each Borrower under a
Mortgage Loan was at the time of origination of thereof either a natural person
or was an entity organized under the laws of the United States or the laws of a
jurisdiction located within the United States, its territories and possessions.
52. Borrower Concentration. No single Borrower or group of
affiliated Borrowers is/are the obligor(s) under any one or more Mortgage Loans
with a Cut-off Date Principal Balance equal to or greater than five percent (5%)
of the Initial Pool Balance.
53. Escrows. All escrow deposits (including capital
improvements and environmental remediation reserves) relating to any Mortgage
Loan that were required to be delivered to the lender under the terms of the
related Mortgage Loan documents, have been received and, to the extent of any
remaining balances of such escrow deposits, are in the possession or under the
control of Seller or its agents (which shall include the Master Servicer). All
such escrow deposits are conveyed hereunder to the Purchaser.
-----------------------------------------
Each representation and warranty of the Seller set forth in
this Exhibit C, to the extent related to the enforceability of any instrument,
agreement or other document or as to offsets, defenses, counterclaims or rights
of rescission related to such enforceability, is qualified to the extent that
(a) enforcement may be limited (i) by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the enforcement of creditors' rights
generally as from time to time in effect, (ii) by general principles of equity
(regardless of whether such enforcement is considered in a proceeding in equity
or at law), and (iii) by any applicable anti-
C-19
deficiency law or statute; and (b) such instrument, agreement or other document
may contain certain provisions which may be unenforceable in accordance with
their terms, in whole or in part, but the unenforceability of such provisions
will not (subject to the qualification in clause (a) above) (i) cause the
related Mortgage Note or the related Mortgage to be void in their entirety, (ii)
invalidate the related Borrower's obligation to pay interest at the stated
interest rate of such Mortgage Note on, and repay the principal of, the related
Mortgage Loan in accordance with the payment terms of such Mortgage Note, such
Mortgage and other written agreements delivered to the Seller in connection
therewith, (iii) invalidate the obligation of any related guarantor to pay
guaranteed obligations with respect to interest at the stated interest rate of
such Note on, and the principal of, such Mortgage Loan in accordance with the
payment terms of such guarantor's written guaranty, (iv) impair the mortgagee's
right to accelerate and demand payment of interest at the stated interest rate
of such Mortgage Note on, and principal of, such Mortgage Loan upon the
occurrence of a legally enforceable default, or (v) impair the mortgagee's right
to realize against the related Mortgaged Property by judicial or, if applicable,
non-judicial foreclosure.
C-20
SCHEDULE C-6
Loan
Number Loan Name Description of Exception
------ --------- ------------------------
7002815 Joesler Fixed Corrective Amendment to reduce grace period from ten days to five
days.
7002301 Alta Loma Square Corrective Amendment to extend defeasance end date to May 31, 2011.
7001304 Xxxxx Business Complex Corrective Amendment to shorten defeasance end date to February 28,
2011.
C-6-1
SCHEDULE C-7
Loan
Number Loan Name Description of Exception
7002913 Redwood Business Park Recommended deferred maintenance
Loan #3 repair per engineering report
not completed or escrowed for
prior to closing. Recommended
repair description: repair
asphalt paving -- apply slurry
seal and restripe parking lot
($18,000).
C-7-1
SCHEDULE C-12
Loan
Number Loan Name Description of Exception
7003019 The Cannery (7/14/00) Environmental reports are dated earlier than
7001810 A&P Warehouse - Central Islip (6/23/00) 12 months prior to the closing date (date of
7001811 A&P Warehouse - Baltimore (6/26/00) report is indicated in parenthesis)
6604714 Woodland Manor Apartments (3/14/00)
7002815 Joesler Village (4/13/00)
7001407 0000 Xxxxxx Xxxxxx (12/26/00)
C-12-1
SCHEDULE C-18
Loan
Number Loan Name Description of Exception
7002725 Market Square Shopping Center Exception to 18(g). The term of the ground lease does not extend
twenty (20) years beyond the end of the amortization term. The end
date of the ground lease is July 27, 2042.
7002269 Deer Valley Plaza Exception to 18(g). The term of the ground lease does not extend
twenty (20) years beyond the end of the amortization term. The end
date of the ground lease is April 13, 2041.
C-18-1
SCHEDULE C-23
Loan
Number Loan Name Description of Exception
7001811 A&P - Baltimore, Maryland The sole member of the borrower obtained an
$8,418,080.00 mezzanine loan from Woodmen of World
Life Insurance Society and/or Omaha Woodmen Life
Insurance Society, which mezzanine loan is secured by
a pledge of 100% of the membership interest in each
borrower, including the grant of a security interest
in all sums distributed by each borrower to the
mezzanine borrower. The mortgage lender and mezzanine
lender entered into a subordination and intercreditor
agreement, pursuant to which the mezzanine lender,
among other things, agreed that the mezzanine lender
has no lien on the real estate. The mezzanine lender
may transfer the mezzanine loan only to an
institutional owner, such transfer must be approved
by the lender, and a rating comfort letter must be
obtained.
As a condition to the mezzanine lender's consent to
the assumption of the A&P -- Central Islip loan
listed above, the principal balance of the mezzanine
loan was paid down to $577,511.28.
C-23-1
SCHEDULE C-41
Loan
Number Loan Name Description of Exception
7001810 A&P Supermarkets- Central Pursuant to Section 17(d) of the mortgage, provided
Islip the A&P Lease is in full force and effect and no
default by the tenant thereunder has occurred and is
continuing, borrower shall be deemed to be in
compliance with the requirements to deliver quarterly
and annual operating statements, rent rolls, annual
financial statements and related information.
7001811 A&P Supermarkets- Baltimore, Pursuant to Section 17(d) of the mortgage, provided
Maryland the A&P Lease is in full force and effect and no
default by the tenant thereunder has occurred and is
continuing, borrower shall be deemed to be in
compliance with the requirements to deliver quarterly
and annual operating statements, rent rolls, annual
financial statements and related information.
C-41-1
SCHEDULE C-42
Primary servicing has been retained on the following loans:
PRIMARY SERVICING
LOAN NUMBER PROPERTY NAME FEE % NAME OF PRIMARY SERVICER
----------- ------------- ----- ------------------------
7003019 The Cannery 0.05% X.X. Xxxxxx & Company
7002913 Redwood Business Park Loan #3 0.05% X.X. Melody & Company
7002275 Market Square Shopping Center 0.07% X.X. Xxxxxx & Company
6604714 Woodland Manor Apartments 0.125% GMAC Commercial Mortgage Corp.
7002917 Redwood Business Park Loan #4 0.05% X.X. Melody & Company
7001963 Remington Apartments 0.05% X.X. Xxxxxx & Company
7001995 The Xxxxxxxxx Apartments 0.09% X.X. Xxxxxx & Company
7001304 Xxxxx Business Complex 0.09% X.X. Xxxxxx & Company
6604590 Eatontown Retail Center 0.125% GMAC Commercial Mortgage Corp.
7002833 K Mart Centre 0.09% X.X. Melody & Company
7001927 Lake Xxxxxxx Trading Post 0.09% X.X. Melody & Company
7001641 Westheimer Village Shopping Center 0.10% GMAC Commercial Mortgage Corp.
7002411 Bradville Square 0.125% GMAC Commercial Mortgage Corp.
0000000 Xxxx Xxxxxx Xxxxx 0.09% X.X. Xxxxxx & Company
7002952 Continental Apartments 0.09% First Trust Bank (Mortgage
Division)
C-42-1
SCHEDULE C-43
Loan
Number Loan Name Description of Exception
7002411 Bradville Square The borrowers are Passco Real Estate Enterprises,
Inc., Passco Bradville Square, LLC (together with
Passco Real Estate Enterprises, Inc., the "Passco
Entities"), Xxxxxxx Xxxxxx, Xxxxxxx X. Xxxxx and Xxxx
Xxxxx, as trustees of the Xxxxx Family Trust and
Xxxxx and Xxxxx Xxxxxxx. Xxxxxxx Xxxxxx is the
carveout guarantor. With respect to fraud and
bankruptcy, each borrower is responsible only for its
own fraud or bankruptcy, unless it actively
participated or colluded in the fraud or bankruptcy
of another borrower. Guarantor guarantees these items
with respect to the Passco Borrowers only. With
respect to the misapplication of rent or waste, only
the Passco Entities have recourse carveout indemnity
obligations. However, guarantor guarantees these
items with respect to all borrowers.
7002815 Joesler Fixed Neither the borrower nor the guarantor is liable for
losses incurred by the holder of the mortgaged loan
by reason of bankruptcy.
0000000 North Xxxxxxx Shopping Center There are two carveout guarantors, Xxxxx
Xxxxxxx, an individual, and HM Mall
Associates Limited Partnership. Xxxxx
Xxxxxxx is not liable for losses incurred by
the holder of the mortgage loan as a result
of a breach of any of the environmental
covenants made by borrower or in the event
of the borrower's or Guarantor's bankruptcy.
0000000 Central Park Plaza The guarantor (Xxxxx Operating Corp.) of the
non-recourse carveouts is not an individual.
7002301 Alta Loma Square The guarantor (Xxxxx Operating Corp.) of the
non-recourse carveouts is not an individual.
7002283 Mountain/Arrow Center The guarantor (Xxxxx Operating Corp.) of the
non-recourse carveouts is not an individual.
7002860 Cumberland Crossing The guarantor (ACP Holdings, Inc.) of the
non-recourse carveouts is not an individual.
7001810 A&P Supermarkets- Central Borrower and guarantor are liable for losses
Islip resulting from (i) fraud or material
misrepresentation, (ii) any bankruptcy or
insolvency proceeding relating to the
borrower, and (iii) misapplication of funds
derived from
C-43-1
the mortgaged property. Borrower and
guarantor are also liable for violations of
applicable environmental laws and acts of
waste, but not while borrower is in physical
possession of the property and the A&P
Lease, which addresses issues of physical
and environmental conditions in a Lease
Modification, Subordination, Non-Disturbance
and Attornment Agreement, is still in
effect.
7001811 A&P Supermarkets- Baltimore, Borrower and guarantor are liable for losses
Maryland resulting from (i) fraud or material
misrepresentation, (ii) any bankruptcy or
insolvency proceeding relating to the
borrower, and (iii) misapplication of funds
derived from the mortgaged property.
Borrower and guarantor are also liable for
violations of applicable environmental laws
and acts of waste, but not while borrower is
in physical possession of the property and
the A&P Lease, which addresses issues of
physical and environmental conditions in a
Lease Modification, Subordination,
Non-Disturbance and Attornment Agreement, is
still in effect.
X-00-0
XXXXXXX X-0
FORM OF CERTIFICATE OF A SECRETARY
OR ASSISTANT SECRETARY OF THE SELLER
SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2001-C2
CERTIFICATE OF SECRETARY OF SALOMON BROTHERS REALTY CORP.
I, ______________________, hereby certify that I am a duly
elected and acting Assistant Secretary of SALOMON BROTHERS REALTY CORP. (the
"Company"), and certify further as follows:
1. The Company is a corporation duly organized and validly
existing under the laws of the State of New York;
2. Attached hereto as Exhibit A is a true, correct and
complete copy of the organizational documents of the Company, as in full force
and effect on the date hereof;
3. Attached hereto as Exhibit B is a certificate of the
Secretary of State of the State of New York issued within ten days of the date
hereof with respect to the good standing of the Company;
4. Since the date of the good standing certificate referred to
in clause 3 above, the Company has not received any notification from the
Secretary of State of the State of New York, or from any other source, that the
Company is not in good standing in New York.
5. Attached hereto as Exhibit C are the resolutions of the
board of directors of the Company authorizing the transactions contemplated by
the Mortgage Loan Purchase Agreement dated as of December __, 2001 (the
"Mortgage Loan Purchase Agreement"), between Salomon Brothers Mortgage
Securities VII, Inc. ("SBMS VII") and the Company, including the sale of the
subject mortgage loans (the "Mortgage Loans") by the Company to SBMS VII. Such
resolutions are in full force and effect on the date hereof and are not in
conflict with any other resolutions of the board of directors of the Company in
effect on the date hereof.
6. The Mortgage Loans do not constitute all or substantially
all of the assets of the Company.
7. To the best of my knowledge, no proceedings looking toward
liquidation or dissolution of the Company are pending or contemplated.
8. Each person who, as an officer or representative of the
Company, signed (a) the Mortgage Loan Purchase Agreement, (b) the
Indemnification Agreement dated as of December __, 2001 (the "Indemnification
Agreement"), among the Company, SBMS VII, Xxxxxxx Xxxxx Xxxxxx Inc., Greenwich
Capital Markets, Inc., Credit Suisse First Boston Corporation, X.X. Xxxxxx
Securities and First Union Securities, Inc., (c) any other document or
certificate delivered on or before the date hereof in connection with the
transactions
D-1
contemplated by the foregoing documents, was, at the respective times of such
signing and delivery, and is as of the Closing Date, duly elected or appointed,
qualified and acting as such officer or representative, and the signature of
such person appearing on any such document is his or her genuine signature.
Capitalized terms used but not otherwise defined herein have
the respective meanings assigned to them in the Mortgage Loan Purchase Agreement
and, if not defined therein, then in the Indemnification Agreement.
IN WITNESS WHEREOF, I have hereunto signed my name as of
___________, 2001.
By:
--------------------------------------
Name:
Title:
The undersigned, an officer of the Company, hereby certifies
that ___________________ is the duly elected and qualified and acting Assistant
Secretary of the Company and that the signature appearing above is his/her
genuine signature.
IN WITNESS WHEREOF, I have hereunto signed my name as of
____________, 2001.
By:
--------------------------------------
Name:
Title:
X-0
XXXXXXX X-0
FORM OF CERTIFICATE OF THE SELLER
SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.
MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2001-C2
CERTIFICATE OF SALOMON BROTHERS REALTY CORP.
In connection with the execution and delivery by Salomon
Brothers Realty Corp. (the "Company") of, and the consummation of the various
transactions contemplated by, that certain Mortgage Loan Purchase Agreement
dated as of December __, 2001 (the "Mortgage Loan Purchase Agreement"), between
Salomon Brothers Mortgage Securities VII, Inc. ("SBMS VII") and the Company, and
the Indemnification Agreement dated as of December __, 2001 (the
"Indemnification Agreement"), among the Company, SBMS VII, Xxxxxxx Xxxxx Xxxxxx
Inc., Greenwich Capital Markets, Inc., Credit Suisse First Boston Corporation,
X.X. Xxxxxx Securities Inc. and First Union Securities, Inc. (together, the
Mortgage Loan Purchase Agreement and the Indemnification Agreement are referred
to herein as the "Agreements"), the undersigned hereby certifies that (i) the
representations and warranties of the Company in the Agreements are true and
correct in all material respects at and as of the date hereof (or, in the case
of the representations and warranties set forth in Exhibit C of the Mortgage
Loan Purchase Agreement, as of such other date specifically provided in the
particular representation and warranty) with the same effect as if made on the
date hereof (or, in the case of the representations and warranties set forth in
Exhibit C of the Mortgage Loan Purchase Agreement, on such other date
specifically provided in the particular representation and warranty), and (ii)
the Company has, in all material respects, complied with all the agreements and
satisfied all the conditions on its part required under the Mortgage Loan
Purchase Agreement to be performed or satisfied at or prior to the date hereof.
Capitalized terms used but not otherwise defined herein have the respective
meanings assigned to them in the Mortgage Loan Purchase Agreement and, if not
defined therein, then in the Indemnification Agreement.
Certified this ___ day of December, 2001.
SALOMON BROTHERS REALTY CORP.
By:
-------------------------------------
Name:
Title:
X-0-0
XXXXXXX X-0X
XXXX XX XXXXXXX OF IN-HOUSE COUNSEL
TO THE SELLER
D-3A-1
December __, 2001
Addressees listed on Exhibit A hereto
Re: Salomon Brothers Mortgage Securities VII, Inc.
Commercial Mortgage Pass-Through Certificates, Series 2001-C2
Ladies and Gentlemen:
This opinion is being provided to you in connection with (i) the
Mortgage Loan Purchase Agreement, dated as of December 18, 2001 (the "Mortgage
Loan Purchase Agreement"), between Salomon Brothers Mortgage Securities VII,
Inc. ("SBMS VII") and Salomon Brothers Realty Corp. (the "Company"), relating to
the sale by the Company of certain mortgage loans (the "Mortgage Loans") and
(ii) the Indemnification Agreement dated as of December 18, 2001 (the
"Indemnification Agreement"), among the Company, SBMS VII, Xxxxxxx Xxxxx Xxxxxx
Inc., Greenwich Capital Markets, Inc., Credit Suisse First Boston Corporation,
X.X. Xxxxxx Securities Inc. and First Union Securities, Inc. The Mortgage Loan
Purchase Agreement and the Indemnification Agreement are collectively referred
to herein as the "Agreements". Capitalized terms not otherwise defined herein
have the meanings assigned to them in the Mortgage Loan Purchase Agreement.
I have examined originals or copies, certified or otherwise
identified to my satisfaction, of such corporate records of the Company,
certificates of public officials, officers of the Company and other persons and
other documents, agreements and instruments and have made such other
investigations as I have deemed necessary or appropriate for purposes of this
opinion.
Based upon the foregoing, I am of the opinion that:
1. The Company is a validly existing New York corporation in good
standing under the laws of the State of New York, with corporate power and
authority under such laws to enter into and perform its obligations under
the Agreements.
2. Each Agreement has been duly authorized, executed and delivered
by the Company.
3. To my knowledge, no consent, approval, authorization or order of
any court, governmental agency or body is required in connection with the
execution and delivery by the Company of the Agreements, except for those
consents, approvals, authorizations or orders that previously have been
obtained.
4. To my knowledge, the transfer of the Mortgage Loans as provided
in the Agreements and the fulfillment of the other terms of the Agreements
will not conflict with or result in a violation of the Certificate of
Incorporation or the By-laws of the Company or any agreement, instrument,
order, writ, judgment or decree to which the Company is a party or is
subject.
5. To my knowledge, there are no actions or proceedings against the
Company, pending (with regard to which the Company has received service of
process) or overtly threatened in writing before any court, governmental
agency or arbitrator which affect the enforceability of the Agreements, or
which would draw into question the validity of the Agreements or any
action taken or to be taken in connection with the Company's obligations
contemplated therein, or which would materially impair the Company's
ability to perform under the terms of the Agreements.
The opinions expressed herein are limited to the laws of the State
of New York and the federal law of the United States.
This opinion is given to you for your sole benefit, and no other
person or entity is entitled to rely hereon without my express written consent.
Very truly yours,
2
EXHIBIT D-3B
FORM OF OPINION OF SIDLEY XXXXXX XXXXX & XXXX,
SPECIAL COUNSEL TO THE SELLER
D-3B-1
SIDLEY XXXXXX XXXXX & XXXX
a partnership including professional corporations
CHICAGO 000 XXXXX XXXXXX BEIJING
----- XXX XXXX, XXX XXXX 00000 -----
DALLAS TELEPHONE 000 000 0000 HONG KONG
----- FACSIMILE 000 000 0000 -----
LOS ANGELES xxx.xxxxxx.xxx LONDON
----- -----
SAN FRANCISCO FOUNDED 1866 SHANGHAI
----- -----
SEATTLE SINGAPORE
----- -----
WASHINGTON, D.C. TOKYO
December 27, 2001
Salomon Brothers Mortgage First Union Securities, Inc.
Securities VII, Inc. 000 Xxxxx Xxxxx Xxxxxx
000 Xxxxxxxxx Xxxxxx Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxxx Xxxxx Barney Inc. Standard & Poor's Ratings Services
000 Xxxxxxxxx Xxxxxx 00 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 10013 New York, New York 10041
Greenwich Capital Markets, Inc. Xxxxx'x Investors Service, Inc.
000 Xxxxxxxxx Xxxx 00 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000 Xxx Xxxx, Xxx Xxxx 00000
Credit Suisse First Boston Corporation Salomon Brothers Realty Corp.
00 Xxxxxxx Xxxxxx 000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000 Xxx Xxxx, Xxx Xxxx 00000
X.X. Xxxxxx Securities Inc. Xxxxx Fargo Bank Minnesota, N.A.
000 Xxxx Xxxxxx, 0xx Xxxxx 00 Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000 Xxx Xxxx, Xxx Xxxx 00000
Re: Salomon Brothers Mortgage Securities VII, Inc.,
Commercial Mortgage Pass-Through Certificates, Series 2001-C2
Ladies and Gentlemen:
We have acted as special counsel to Salomon Brothers Realty Corp.
("SBRC") in connection with certain matters relating to the transactions
contemplated by that certain Mortgage Loan Purchase Agreement, dated as of
December 18, 2001 (the "Mortgage Loan Purchase Agreement"), between SBRC, as
seller, and Salomon Brothers Mortgage Securities VII, Inc. ("SBMS VII"), as
purchaser.
This opinion letter is being provided to you pursuant to Section
7(h) of the Mortgage Loan Purchase Agreement. Capitalized terms not defined
herein have the respective meanings set forth in, or otherwise assigned to them
pursuant to, the Mortgage Loan Purchase Agreement.
SIDLEY XXXXXX XXXXX & XXXX NEW YORK
December 27, 2001
Page 2
For the purposes of this opinion letter, we have reviewed the
Mortgage Loan Purchase Agreement. In addition, we have examined originals or
copies, certified or otherwise identified to our satisfaction, of such other
documents and records as we have deemed relevant or necessary as the basis for
the opinions contained in this letter; we have obtained such certificates from
and made such inquiries of officers and representatives of the parties to the
Mortgage Loan Purchase Agreement and public officials as we have deemed relevant
or necessary as the basis for such opinions; and we have relied upon, and
assumed the accuracy of, such other documents and records, such certificates and
the statements made in response to such inquiries, with respect to the factual
matters upon which such opinions are based. We have also assumed (i) the
truthfulness and accuracy of each of the representations and warranties as to
factual matters material to this opinion contained in the Mortgage Loan Purchase
Agreement, (ii) the legal capacity of natural persons, (iii) the genuineness of
all signatures, (iv) the authenticity of all documents submitted to us as
originals, (v) the conformity to authentic originals of all documents submitted
to us as certified, conformed, photostatic or electronic copies, (vi) the due
organization of the parties to the Mortgage Loan Purchase Agreement and the
valid existence of each such entity in good standing under the laws of its
jurisdiction of organization, (vii) except as expressly addressed in opinion
paragraph 2 below, the power and authority of the parties to the Mortgage Loan
Purchase Agreement to enter into, perform under and consummate the transactions
contemplated by the Mortgage Loan Purchase Agreement, without any resulting
conflict with or violation of the organizational documents of any such party or
with or of any law, rule, regulation, order or decree applicable to any such
party or its assets, and without any resulting default under or breach of any
other agreement or instrument by which any such party is bound or which is
applicable to it or its assets, (viii) the due authorization by all necessary
action, and the due execution and delivery, of the Mortgage Loan Purchase
Agreement by the parties thereto, (ix) except as expressly addressed in opinion
paragraph 1 below, the constitution of the Mortgage Loan Purchase Agreement as
the legal, valid and binding obligation of each party thereto, enforceable
against such party in accordance with its terms, and (x) the absence of any
other agreement that supplements or otherwise modifies the express terms of the
Mortgage Loan Purchase Agreement.
In delivering this opinion letter, we do not express any opinions
concerning the laws of any jurisdiction other than the laws of the State of New
York and, where expressly referred to below, the federal laws of the United
States of America (without regard to conflicts of law principles). In addition,
we do not express any opinion with respect to the tax, securities or "doing
business" laws of any particular jurisdiction or with respect to any matter not
expressly addressed below.
Our opinions set forth below with respect to the enforceability of
any agreement or any particular right or obligation under any agreement are
subject to: (1) general principles of equity, including concepts of materiality,
reasonableness, good faith and fair dealing and the doctrine of estoppel; (2)
the possible unavailability of specific performance and injunctive relief,
regardless of whether considered in a proceeding in equity or at law; (3) the
effect of certain laws, rules, regulations and judicial and other decisions upon
the enforceability of (a) any provision that purports to waive (i) the
application of any federal, state or local statute, rule or regulation, (ii) the
application of any general principles of equity or (iii) the obligation of
diligence, (b) any provision that purports to grant any remedies that would not
otherwise be available at law, to restrict access to
SIDLEY XXXXXX XXXXX & XXXX NEW YORK
December 27, 2001
Page 3
any particular legal or equitable remedies, to make any rights or remedies
cumulative and enforceable in addition to any other right or remedy, to provide
that the election of any particular remedy does not preclude recourse to one or
more other remedies, to provide that the failure to exercise or the delay in
exercising rights or remedies will not operate as a waiver of such rights or
remedies, to impose penalties or forfeitures, or to provide for set-off in the
absence of mutuality between the parties, (c) any provision that purports to
release, exculpate or exempt a party from, or indemnify a party for, liability
for any act or omission on its part that constitutes negligence, recklessness or
willful or unlawful conduct, (d) any provision that purports to govern matters
of civil procedure, including any such provision that purports to establish
evidentiary standards, to waive objections to venue or forum, to confer subject
matter jurisdiction on any court that would not otherwise have such jurisdiction
or to waive any right to a jury trial, or (e) any provision that purports to
render unenforceable any modification, waiver or amendment that is not executed
in writing, to sever any provision of any agreement, to appoint any person or
entity as the attorney-in-fact of any other person or entity or to provide that
any agreement or any particular provision thereof is to be governed by or
construed in accordance with the laws of any jurisdiction other than the State
of New York; (4) bankruptcy, insolvency, receivership, reorganization,
liquidation, voidable preference, fraudulent conveyance and transfer, moratorium
and other similar laws affecting the rights of creditors or secured parties
generally; and (5) public policy considerations underlying the securities laws,
to the extent that such public policy considerations limit the enforceability of
any provision of any agreement that purports or is construed to provide
indemnification with respect to securities law violations.
Based upon and subject to the foregoing, we are of the opinion that:
1. The Mortgage Loan Purchase Agreement constitutes a valid, legal
and binding agreement of SBRC, enforceable against SBRC in accordance with
its terms.
2. The execution, delivery and performance of the Mortgage Loan
Purchase Agreement by SBRC will not conflict with or result in a violation
of any federal or State of New York statute or regulation generally
applicable to domestic corporations in connection with transactions of the
type contemplated by the Mortgage Loan Purchase Agreement.
The opinions expressed herein are being delivered to you as of the
date hereof, and we assume no obligation to advise you of any changes of law or
fact that may occur after the date hereof, notwithstanding that such changes may
affect the legal analysis or conclusions contained herein. This opinion letter
is being delivered solely for your benefit in connection with the transactions
contemplated by the Mortgage Loan Purchase Agreement. Accordingly, it may not be
quoted, filed with any governmental authority or other regulatory agency or
otherwise circulated or utilized for any other purpose without our prior written
consent.
Very truly yours,
EXHIBIT D-3C
FORM OF LETTER RELATING
TO DISCLOSURE FROM SIDLEY XXXXXX XXXXX & XXXX,
SPECIAL COUNSEL TO THE SELLER
D-3C-1
[SIDLEY XXXXXX XXXXX & XXXX LETTERHEAD]
December 27, 2001
Salomon Brothers Mortgage X.X. Xxxxxx Securities Inc.
Securities VII, Inc. 000 Xxxx Xxxxxx, 0xx Xxxxx
000 Xxxxxxxxx Xxxxxx Xxx Xxxx, Xxx Xxxx 00000
Xxx Xxxx, Xxx Xxxx 00000
First Union Securities, Inc.
Xxxxxxx Xxxxx Barney Inc. 000 Xxxxx Xxxxx Xxxxxx
000 Xxxxxxxxx Xxxxxx Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Xxx Xxxx, Xxx Xxxx 00000
Greenwich Capital Markets, Inc.
Credit Suisse First Boston Corporation 000 Xxxxxxxxx Xxxx
00 Xxxxxxx Xxxxxx Xxxxxxxxx, Xxxxxxxxxxx 00000
Xxx Xxxx, Xxx Xxxx 00000
Re: Salomon Brothers Mortgage Securities VII, Inc.
Commercial Mortgage Pass-Through Certificates, Series 2001-C2
Ladies and Gentlemen:
We have acted as special counsel to Salomon Brothers Mortgage
Securities VII, Inc. (the "Depositor"), Salomon Brothers Realty Corp. ("SBRC"),
Greenwich Capital Financial Products, Inc. ("GCFP") and Artesia Mortgage Capital
Corporation ("AMCC") in connection with certain matters relating to the
following transactions (collectively, the "Transactions"):
(i) the sale by SBRC, and the purchase by the Depositor, of certain
multifamily and commercial mortgage loans (the "SBRC Mortgage Loans"),
pursuant to that certain Mortgage Loan Purchase Agreement, dated as of
December 18, 2001 (the "SBRC Mortgage Loan Purchase Agreement"), between
SBRC and the Depositor;
(ii) the sale by GCFP, and the purchase by the Depositor, of certain
multifamily and commercial mortgage loans (the "GCFP Mortgage Loans"),
pursuant to that certain Mortgage Loan Purchase Agreement, dated as of
December 18, 2001 (the "GCFP Mortgage Loan Purchase Agreement"), between
GCFP and the Depositor;
(iii) the sale by AMCC, and the purchase by the Depositor, of
certain multifamily and commercial mortgage loans (the "AMCC Mortgage
Loans"), pursuant to
SIDLEY XXXXXX XXXXX & XXXX NEW YORK
December 27,2001
Page 2
that certain Mortgage Loan Purchase Agreement, dated as of December 18,
2001 (the "AMCC Mortgage Loan Purchase Agreement"), between AMCC and the
Depositor;
(iv) the sale by Allied Capital Corporation ("Allied"), and the
purchase by the Depositor, of a certain commercial mortgage loan (the "MJ
Ocala Hilton Loan"), pursuant to that certain Mortgage Loan Purchase
Agreement, dated as of December 18, 2001 (the "Allied Mortgage Loan
Purchase Agreement") between Allied and the Depositor;
(v) the creation of a common law trust (the "Trust") and the
issuance of an aggregate $877,619,220 Certificate Principal Balance of
Commercial Mortgage Pass-Through Certificates, Series 2001-C2 (the
"Certificates"), consisting of 22 classes designated Class A-1, Class A-2,
Class A-3, Class B, Class C, Class D, Class E, Class X-1, Class X-2, Class
F, Class G, Class H, Class J, Class K, Class L, Class M, Class N, Class P,
Class Q, Class BR, Class R and Class Y, pursuant to that certain Pooling
and Servicing Agreement, dated as of December 1, 2001 (the "Pooling and
Servicing Agreement"), among the Depositor as Depositor, Midland Loan
Services, Inc., as Master Servicer, as General Special Servicer and as
Birch Run Special Servicer, Xxxxx Fargo Bank Minnesota, N.A., as Trustee,
XX Xxxxxx Chase Bank, as Certificate Administrator and Tax Administrator,
Fortress CBO Investments I, Ltd. as Birch Run Companion Mortgage Loan
Noteholder and Allied as MJ Ocala Hilton Companion Mortgage Loan
Noteholder;
(vi) the conveyance of the SBRC Mortgage Loans, the GCFP Mortgage
Loans, the AMCC Mortgage Loans and the MJ Ocala Hilton Loan (collectively,
the "Mortgage Loans") by the Depositor to the Trust, pursuant to the
Pooling and Servicing Agreement, in exchange for the issuance of the
Certificates; and
(vii) the sale by the Depositor, and the purchase by Xxxxxxx Xxxxx
Xxxxxx Inc. ("SSBI"), Greenwich Capital Markets, Inc. ("Greenwich
Capital"), Credit Suisse First Boston Corporation ("CSFB"), X.X. Xxxxxx
Securities Inc. ("X.X. Xxxxxx") and First Union Securities, Inc.
("Wachovia Securities"; and, together with SSBI, Greenwich Capital, CSFB
and X.X. Xxxxxx in such capacity, the "Underwriters"), of the Class A-1,
Class A-2, Class A-3, Class B, Class C, Class D and Class E Certificates
(collectively, the "Publicly Offered Certificates"), pursuant to that
certain Underwriting Agreement, dated as of December 18, 2001 (the
"Underwriting Agreement"), between the Depositor and the Underwriters.
The SBRC Mortgage Loan Purchase Agreement, the GCFP Mortgage Loan
Purchase Agreement, the AMCC Mortgage Loan Purchase Agreement and the Allied
Mortgage Loan Purchase Agreement are collectively referred to herein as the
"Mortgage Loan Purchase Agreements". The Mortgage Loan Purchase Agreements, the
Pooling and Servicing Agreement and the Underwriting Agreement are collectively
referred to herein as the "Agreements".
SIDLEY XXXXXX XXXXX & XXXX NEW YORK
December 27,2001
Page 3
Capitalized terms not defined herein have the respective meanings set forth in
the Pooling and Servicing Agreement and, to the extent not defined therein, in
the other Agreements.
For the purposes of this letter, we have reviewed: the Agreements;
the Depositor's registration statement on Form S-3 (No. 333-63752) (the
"Registration Statement") filed with the Securities and Exchange Commission (the
"Commission") under the Securities Act of 1933, as amended (the "1933 Act"); the
Prospectus, dated December 10, 2001, relating to publicly offered mortgage
pass-through certificates evidencing interests in trust funds established by the
Depositor (the "Basic Prospectus"); and the Prospectus Supplement, dated
December 18, 2001, specifically relating to the Trust and the Publicly Offered
Certificates (including all exhibits and annexes thereto, the "Original
Prospectus Supplement") the Supplement to the Original Prospectus Supplement
(the "Additional Supplement"; and, together with the Basic Prospectus and the
Original Prospectus Supplement, the "Prospectus"). In addition, we have examined
originals or copies, certified or otherwise identified to our satisfaction, of
such other documents and records as we have deemed relevant or necessary as the
basis for the statements made in this letter; we have obtained such certificates
from and made such inquiries of officers and representatives of the respective
parties to the Agreements and public officials as we have deemed relevant or
necessary as the basis for the statements made in this letter; and we have
relied upon, and assumed the accuracy of, such other documents and records, such
certificates and the statements made in response to such inquiries, with respect
to the factual matters upon which the statements made in this letter are based.
We have also assumed (i) the truthfulness and accuracy of each of the
representations and warranties as to factual matters contained in the
Agreements, (ii) the legal capacity of natural persons, (iii) the genuineness of
all signatures, (iv) the authenticity of all documents submitted to us as
originals, (v) the conformity to authentic originals of all documents submitted
to us as certified, conformed, photostatic or electronic copies, (vi) the due
authorization by all necessary action, and the due execution and delivery, of
the Agreements by the parties thereto, (vii) the constitution of each of the
Agreements as the legal, valid and binding obligation of each party thereto,
enforceable against such party in accordance with its terms, (viii) compliance
with the Agreements by the parties thereto, (ix) the conformity, to the
requirements of the Pooling and Servicing Agreement and the respective Mortgage
Loan Purchase Agreements, of the Mortgage Notes, the Mortgages and the other
documents relating to the Mortgage Loans delivered to the Custodian by, on
behalf of or at the direction of the Depositor, SBRC, GCFP, AMCC and Allied, (x)
the conformity of the text of each document filed with the Commission through
the Commission's Electronic Data Gathering, Analysis and Retrieval System to the
printed documents reviewed by us, and (xi) the absence of any agreement that
supplements or otherwise modifies the express terms of the Agreements. In
rendering this letter, we do not make any statement concerning the laws of any
jurisdiction other than the federal laws of the United States of America.
In the course of acting as special counsel to the Depositor, SBRC,
GCFP and AMCC in connection with the preparation of the Prospectus, we have
generally reviewed and discussed with certain representatives of the Depositor,
SBRC, GCFP, AMCC, SSBI, Greenwich Capital and the other parties to the
Agreements and their respective counsel (in addition to us)
SIDLEY XXXXXX XXXXX & XXXX NEW YORK
December 27,2001
Page 4
the information set forth in the Prospectus, other than any documents or
information incorporated by reference in the Prospectus. In addition, we have
reviewed loan summaries delivered to us by SBRC, GCFP and AMCC with respect to
the SBRC Mortgage Loans, the GCFP Mortgage Loans and the AMCC Mortgage Loans,
respectively; and we have undertaken a limited review of copies of certain
environmental insurance policies and other selected Mortgage Loan documents with
respect to certain SBRC Mortgage Loans, GCFP Mortgage Loans and AMCC Mortgage
Loans. While we have not otherwise made any independent check or verification
of, and do not assume any responsibility for, the accuracy, completeness or
fairness of the statements contained in the Registration Statement or the
Prospectus, on the basis of the foregoing, nothing has come to our attention
that causes us to believe that the Registration Statement, as of its effective
date, contained any untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading, or that the Prospectus, as of the date of the Additional
Prospectus Supplement or as of the date hereof, contained or contains any untrue
statement of a material fact or omitted or omits to state a material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading, except that we make no statement as
to: (i) any accounting, financial or statistical data or other information of
that nature contained in or omitted from the Registration Statement or the
Prospectus; (ii) any documents or information incorporated by reference in the
Registration Statement or the Prospectus; or (iii) any information on or omitted
from the diskette that accompanies the Prospectus. In that connection, we advise
you that we have, as to materiality, relied to the extent we deemed appropriate
upon the judgment of officers and representatives of the Depositor, SBRC, GCFP
and AMCC. In addition, in that connection, we call to your attention that, with
your knowledge and consent, except as stated above, we have not examined or
otherwise reviewed any of the Mortgage Files, Servicing Files or any particular
documents contained in such files or any other documents with respect to the
Mortgage Loans.
When used in this letter, the term "attention" or any other word or
phrase of similar import means the conscious awareness of facts or other
information of solely those attorneys who are currently practicing law with
Sidley Xxxxxx Xxxxx & Xxxx and have been actively involved in representing the
Depositor, SBRC, GCFP and AMCC in connection with any matters relating to the
Transactions. With your permission, no attempt was made by such attorneys to
gather information from any other attorneys currently practicing law with Sidley
Xxxxxx Xxxxx & Xxxx that may have represented the Depositor, SBRC, GCFP, AMCC or
any of their respective affiliates in other matters or to review any files
associated with those matters.
This letter is being delivered to you as of the date hereof, and we
assume no obligation to advise you of any changes of law or fact that may occur
after the date hereof, notwithstanding that such changes may affect the
statements made herein. This letter is solely for your benefit in connection
with the Transactions and may not be relied on in any manner for any other
purpose or by any other person or transmitted to any other person without our
prior consent.
SIDLEY XXXXXX XXXXX & XXXX NEW YORK
December 27,2001
Page 5
Very truly yours,
