Defeasance Account Agreement
Exhibit 10.10
THIS DEFEASANCE ACCOUNT AGREEMENT (this “Agreement”) is entered into as of
November 18, 2005 by and among CASA MUNRAS HOTEL PARTNERS, L.P., a California limited partnership
(“Pledgor”), ▇▇▇▇▇ FARGO BANK, N.A., as Securities Intermediary and Custodian
(“Intermediary”), U.S. BANK NATIONAL ASSOCIATION, successor-in-interest to State Street
Bank and Trust Company, as Trustee under the Pooling and Servicing Agreement, dated as of October
1, 1998 (the “Pooling and Servicing Agreement”), for the Registered Holders of Credit
Suisse First Boston Mortgage Securities Corp., Commercial Mortgage Pass-Through Certificates,
Series 1998-PS2 and as secured party (together with its successors and assigns,
“Pledgee”), and GMAC COMMERCIAL MORTGAGE CORPORATION, successor-in-interest to AMRESCO
Services, L.P., as servicer, as servicer on behalf of said trustee under the Pooling and Servicing
Agreement (“Servicer”) upon the following terms and conditions:
Recitals
A. On or about June 12, 1998, AMRESCO Capital, L.P., a Delaware limited partnership
(“Original Lender”) advanced to Pledgor the original principal amount of $7,000,000.00
(the “Loan”). The Loan is evidenced by that certain Fixed Rate Note [With Defeasance and
Lockbox Provisions] dated as of June 12, 1998 from Pledgor to Original Lender (the
“Note”). The Note and other documents evidencing the Loan shall be referred to herein as
“Loan Documents”).
B. Pledgor, Pledgee and Intermediary have entered into that certain Defeasance Pledge and
Security Agreement of even date herewith (as from time to time amended, supplemented or modified,
the “Security Agreement”) with respect to the securities listed in Exhibit A
attached hereto (the “Securities”) and other assets that, together with the Securities,
constitute the Pledged Collateral (as defined in the Security Agreement).
C. Pledgor desires that Intermediary hold the Pledged Collateral and perform certain services
as a “Securities Intermediary” and “Custodian” (both as defined in the Security Agreement).
D. Intermediary is willing to hold the Pledged Collateral and to perform such services,
subject to the terms and conditions of this Agreement and the Security Agreement.
E. The parties intend that immediately upon the execution of this Agreement, Pledgor, Pledgee
and NEWCSFBMSC 98-PS2, LLC, a Delaware liability company (“Successor Borrower”) will enter
into a Defeasance Assignment, Assumption and Release Agreement pursuant to which, among other
things, Pledgor will transfer its rights and obligations under the Note and the Security Agreement,
as well as the Pledged Collateral to Successor Borrower.
NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
Section 1. Definitions.
Each capitalized term used herein and not defined herein shall have the meaning assigned to
such term in the Security Agreement. In addition, the following terms shall have the following
meanings when used herein.
“Accountant’s Letter” means that certain math verification report of even date from
▇▇▇▇▇▇, Demgen & ▇▇▇▇▇, Inc. regarding the defeasance of the Loan, including all schedules thereto,
a copy of which is attached hereto as Exhibit B.
“Business Day” means any day other than (i) a Saturday or a Sunday and (ii) a day on
which federally insured depository institutions in the State or the state in which Intermediary
maintains the Pledged Collateral Account are authorized or obligated by law, regulation,
governmental decree or executive order to be closed.
“Certificates” means Credit Suisse First Boston Mortgage Securities Corp., Commercial
Mortgage Pass-Through Certificates, Series 1998-PS2.
“Collection Account” means the account maintained and designated by Servicer for
deposit of payments due under the Note, and shall be the account described in Exhibit F
attached hereto.
“Default Permitted Investment” means the institutional shares of the Federated Prime
Obligations Fund #10 CUSIP ▇▇▇▇▇▇▇▇▇, or any money market fund, but only for so long as such fund
is rated not less than “AAAm” or “AAAm-G” by S&P and the equivalent by each other Rating Agency or
is otherwise acceptable to each Rating Agency, as confirmed in writing that such account would not,
in and of itself, result in a downgrade, qualification or withdrawal of the then current ratings
assigned to the Certificates.
“Eligible Account” means (i) a segregated account maintained with an Eligible
Institution, or (ii) an account otherwise acceptable to each Rating Agency, as confirmed in writing
that such account would not, in and of itself, result in a downgrade, qualification or withdrawal
of the then current ratings assigned to the Certificates.
“Eligible Institution” means (i) a federal or state chartered depository institution
or trust company whose commercial paper, short-term debt obligations or other short-term deposits
are rated at least “A-1” by S&P, at least P1 by Moody’s and at least F-1+ by Fitch if the deposits
in the Pledged Collateral Account are to be held for thirty (30) days or less, or (ii) a federal or
state-chartered depository institution or trust company whose long-term unsecured debt obligations
are rated at least “A-” by S&P, at least Aa3 by Moody’s and at least AA by Fitch if the deposits in
the Pledged Collateral Account are to be held for more than thirty (30) days, or (iii) the trust
department of a federal or state chartered depository institution or trust company acting in its
fiduciary capacity which institution or trust company is subject to regulations regarding fiduciary
funds on deposit substantially similar to 12 C.F.R.§ 9.10(b), or (iv) an institution otherwise
acceptable to each Rating Agency, as confirmed in writing that the holding by such institution of
the Pledged Collateral Account would not, in and of itself, result in a downgrade, qualification or
withdrawal of the then current ratings assigned to the Certificates.
“Fitch” means Fitch, Inc.
“Moody’s” means ▇▇▇▇▇’▇ Investors Service, Inc.
“Permitted Investment” shall have the meaning set forth in Exhibit C hereto.
“Rating Agency” means each of S&P, Moody’s and/or Fitch which rates any or all of the
Certificates.
“S&P” means Standard & Poor’s Ratings Services, a division of The McGraw Hill
Companies, Inc.
“Scheduled Payment Date” means the first (1st) day of each calendar month,
or if such a day is not a Business Day, the next succeeding Business Day.
“Servicer” means any duly authorized loan servicer acting as agent of Pledgee. As of
the date hereof, Servicer shall mean GMAC Commercial Mortgage Corporation, successor-in-interest to
AMRESCO Services, L.P., together with its successors and assigns under the Pooling and Servicing
Agreement.
Section 2. Establishment and Custody of Pledged Collateral Account.
Intermediary has established Account No. ▇▇▇▇▇▇▇▇ titled “NEWCSFBMSC 98-PS2 LLC (Casa Munras
Hotel Partners) Defeasance” at Intermediary, which is, or is associated with, a Securities Account
maintained by Intermediary in the name of Pledgee (together, the “Pledged Collateral
Account”). Pledgor hereby authorizes, appoints and directs Intermediary to act as Securities
Intermediary with respect to the Pledged Collateral and as Custodian of the Pledged Collateral
Account, subject to the Security Agreement, and to hold the Pledged Collateral Account subject to
the sole dominion and control (as defined in Section 8-106 of the Code) of Pledgee. Intermediary
agrees to at all times maintain the Pledged Collateral Account and all of the Pledged Collateral at
its office currently located in Minneapolis, Minnesota, and to serve as Securities Intermediary
with respect to the Securities and the other Pledged Collateral and as Custodian with respect to
the Pledged Collateral Account, in accordance with this Agreement and the Security Agreement,
provided however, in the event the Intermediary intends to move the Pledged Collateral Account to
another location, it shall provide the Pledgee with thirty (30) days prior written notice and the
Intermediary shall cooperate with Pledgee in ensuring the Pledgee’s perfected security interest in
the Pledged Collateral Account as required under the Code, including without limitation, the
execution of any and all documents required to continue the Pledgee’s perfected security interest
in the Pledged Collateral Account. Notwithstanding anything to the contrary contained herein,
Pledgor and Intermediary agree that New York is the Intermediary’s jurisdiction for purposes of the
Code.
Section 3. Title to Pledged Collateral.
Title to the Pledged Collateral shall be held in accordance with the Security Agreement and
the Federal Book-Entry Regulations.
Section 4. Intermediary’s Duties Regarding Pledged Collateral.
(a) Administration. Intermediary shall have no responsibility for supervision or
management of the Pledged Collateral except as provided in this Agreement, the Security Agreement
or as otherwise provided by applicable law. The Pledged Collateral Account shall at all times be
maintained as a segregated Eligible Account. Each item of property at any time credited to the
Pledged Collateral Account shall be treated by Intermediary as a Financial Asset. Proceeds of the
Pledged Collateral, and interest and earnings thereon, shall be credited to and held in the Pledged
Collateral Account, and shall be re-invested only in accordance with this Agreement.
Intermediary’s responsibility with regard to the sale, purchase, exchange or other matters relating
to any assets at any time in the Pledged Collateral Account shall be limited to following,
immediately upon receipt thereof, all written orders, including Entitlement Orders (as defined in
the Security Agreement), of Servicer (acting on behalf of Pledgee), without the need for consent by
Pledgor or any other Person. Upon the assumption of this Agreement by Successor Borrower pursuant
to the Assignment and Assumption Agreement, the Pledged Collateral Account shall be assigned the
federal tax identification number of Successor Borrower which number is ▇▇-▇▇▇▇▇▇▇, and all taxable
income earned or gain realized with respect to the Pledged Collateral shall be taxable as income or
gain, as applicable, of Successor Borrower.
(b) Eligible Institution. Intermediary shall at all times (subject to permitted
transfers as provided in the Security Agreement) serve as both Securities Intermediary and
Custodian hereunder. Intermediary is and shall at all times (subject to permitted transfers as
provided in the Security Agreement) continue to be, and the Pledged Collateral Account shall at all
times be maintained with, an Eligible Institution. Upon any downgrade, withdrawal, qualification
or suspension by any Rating Agency of the rating of Intermediary (or any successor to Intermediary
permitted or required under this Agreement) or any other circumstances resulting in a failure to
qualify as an Eligible Institution, (i) the Securities Account, the Pledged Collateral Account and
all of the Pledged Collateral, and all rights and obligations of Intermediary (or such successor to
Intermediary) under this Agreement, shall promptly, and in any case within thirty (30) calendar
days, be moved to an Eligible Institution that is a Securities Intermediary and maintains a
Participant’s Securities Account with the Federal Reserve Bank; (ii) such Eligible Institution
shall assume in writing all obligations of Intermediary (or such successor Intermediary) under this
Agreement; and (iii) Intermediary shall promptly reimburse Pledgee for all expenses incurred in
connection with the appointment of such Eligible Institution as successor Intermediary including
all future fees of such successor Intermediary in connection with the Pledged Collateral Account
and the services to be provided by such successor Intermediary (or such successor Intermediary).
(c) Reinvestment of Proceeds; Permitted Investments. Provided no Event of Default has
occurred, upon the written request of Successor Borrower which request may be made once per month,
Servicer shall direct Intermediary to invest and reinvest any funds in the Pledged Collateral
Account from time to time in Permitted Investments as instructed by Successor Borrower;
provided, however, that if Successor Borrower fails to so instruct Servicer, or if
an Event of Default shall have occurred, Servicer may direct Intermediary to invest and reinvest
such funds in such Permitted Investments as Servicer shall determine in Servicer’s discretion;
provided, further, to the extent any funds in the Pledged Collateral Account will be
necessary to make payments to the Collection Account more than three (3) months after the
related Securities were converted to cash, such funds shall be invested only in obligations of, or
obligations guaranteed as to principal and interest by, the United States or an agency or
instrumentality thereof, backed by the full faith and credit of the United States. Intermediary
shall have no obligation to invest funds in the Pledged Collateral Account absent its receipt of
written instructions from Servicer in accordance herewith. Pledgor hereby instructs Servicer, and
Servicer hereby instructs Intermediary, to invest funds in the Pledged Collateral Account in the
Default Permitted Investment unless and until different instructions are received in accordance
with this subsection (c). To the extent that any funds in the Pledged Collateral Account are to be
paid out pursuant to Section 4(e), Permitted Investments shall be selected that will mature, unless
payable on demand, no later than one (1) Business Day before the date such funds are required to be
paid out pursuant to Section 4(e) If a requested investment is determined to be, in the
reasonable judgment of Servicer, an investment for which confirmation from one or more of the
Rating Agencies is required, Servicer shall, within three (3) Business Days of receipt of the
required confirmation from the Rating Agencies, provide instructions to Intermediary as provided
for herein; provided that Servicer shall not be required to request confirmation from any Rating
Agency without a written instruction to do so, and reasonable assurance of reimbursement for its
costs associated therewith from Pledgor. Pledgor shall be responsible for paying all costs
associated with obtaining such Rating Agency confirmation, including, but not limited to, Servicer
fees and Rating Agency fees. With respect to all investments made on instructions of Successor
Borrower, Successor Borrower shall be liable for (i) ordinary and customary transaction fees
associated with the investment of funds in the Pledged Collateral Account except as provided in
Section 9 and (ii) losses that result from such investment, and shall pay such fees or
reimburse Pledgee for such investment losses within five (5) days after receipt of written request
or invoice therefor Intermediary shall have three (3) Business Days following receipt of such
instructions to effectuate such investment direction. Intermediary may conclusively rely upon the
investment instructions received from Servicer. All Permitted Investments shall be under the sole
dominion and control of Pledgee. No Permitted Investment shall be made unless Pledgee holds a
first priority perfected lien in such Permitted Investment and all filings and other actions
necessary to ensure the validity, perfection, and priority of such lien have been taken. Servicer
shall only be required to follow the written investment instructions that were most recently
received by Servicer, and Successor Borrower shall be bound by such last received investment
instructions. Any request from Successor Borrower containing investment instructions shall
contain an officer’s certificate from Successor Borrower (which may be conclusively relied upon by
Servicer, Intermediary and their agents) that any such investments constitute Permitted
Investments. Intermediary hereby certifies that the Default Permitted Investment constitutes a
Permitted Investment. All such Permitted Investments shall be held to maturity unless payable on
demand in which case Intermediary shall demand payment as necessary to meet the payment
requirements of Section 4(e) All earnings and payments received with respect to Permitted
Investments shall be credited to and held in the Pledged Collateral Account in accordance with this
Agreement. In all actions taken, and all instructions given by Servicer pursuant to this
Section 4(c), Servicer shall be deemed to act on behalf of no person other than Pledgee.
(d) Collection of Interest, Principal and Earnings. Intermediary shall collect all
interest and principal when due from any Obligor with respect to the Pledged Collateral, and shall
collect all amounts due with respect to Permitted Investments, and shall
deposit all amounts so collected to the Pledged Collateral Account, but shall be under no
responsibility or duty to undertake collection efforts or to instigate or participate in any legal
proceedings or to retain counsel in an effort to accomplish such collection. All revenues received
in any such collection action shall be deposited to the Pledged Collateral Account and disposed of
as set forth herein.
(e) Distributions. Pledgee, acting by Servicer as herein provided, shall have the
sole right to control distributions from the Pledged Collateral Account. Except as otherwise
specifically provided in written instructions given by Servicer to Intermediary in accordance with
Section 5 below, Intermediary shall, to the extent of funds on deposit in the Pledged
Collateral Account, make payments to the Collection Account by wire or internal transfer in an
amount equal to $52,643.44 beginning on December 1, 2005 and continuing thereafter on each
Scheduled Payment Date until July 1, 2008 on which date Intermediary shall pay by wire or internal
transfer an amount equal to $5,662,474.51, all such amounts as provided for in the Note and shown
in the Accountant’s Letter. Pledgor (and following the contemplated assignment of this Agreement
by Pledgor, Successor Borrower) hereby directs Intermediary to make payments in accordance with the
foregoing instructions. Notwithstanding any contrary provisions in the Note, any amounts remaining
in the Pledged Collateral Account after payments are made to the Collection Account pursuant to the
preceding sentence shall be held in the Pledged Collateral Account until after the final payment of
all amounts required under the Note and other Defeasance Documents on account of the Secured
Obligations have been paid, whereupon, provided no Event of Default that would trigger personal
liability of Successor Borrower exists under any other Defeasance Transaction, any amounts
remaining in the Pledged Collateral Account shall be paid over to Successor Borrower within 5
Business Days.
(f) Default. Pledgee shall have all of the rights and remedies afforded under the
Security Agreement or otherwise, at law or in equity, with respect to any default under this
Agreement. Without limiting the generality of the foregoing, if Intermediary fails to make any of
the foregoing payments when funds are available for such payment in the Pledged Collateral Account,
Intermediary shall reimburse Pledgor for late fees accruing under the Note, until the missed
payment is made.
Section 5. Instructions; Signatures.
(a) From Servicer. All instructions and directions from Servicer to Intermediary for
the Pledged Collateral Account must be in writing, signed by a person or persons duly authorized by
Servicer on behalf of Pledgee to sign, such instructions to be in such form as Intermediary may
reasonably require. Specimen signatures of all persons to whom authority has been delegated shall
be furnished. The employees of Servicer as identified on Exhibit D are authorized by
Servicer on behalf of Pledgee to deliver instructions to Intermediary hereunder.
Servicer, acting on behalf of Pledgee shall have the right, from time to time, to change the
list of persons duly authorized to sign instructions on behalf of Pledgee. Any changes to the list
of authorized signatories shall be deemed effective upon delivery to Intermediary of written notice
regarding such changes.
(b) From Successor Borrower. After the contemplated assignment by Pledgor to
Successor Borrower, all instructions and directions from Successor Borrower to Servicer for the
Pledged Collateral Account must be in writing, signed by a person or persons duly authorized by
Successor Borrower to sign, such instructions to be in such form as Servicer may reasonably
require. Specimen signatures of all persons to whom authority has been delegated shall be
furnished. The officers of the Manager of Successor Borrower as identified on Exhibit E
are authorized by Successor Borrower to deliver instructions to Servicer hereunder.
Successor Borrower shall have the right, from time to time, to change the list of persons duly
authorized to sign instructions on behalf of Successor Borrower. Any changes to the list of
authorized signatories shall be deemed effective upon delivery to Servicer of written notice
regarding such changes.
Section 6. Accounting.
Intermediary shall (i) keep complete and accurate books of the Pledged Collateral Account and
all Permitted Investments showing all receipts, disbursements and transactions in the Pledged
Collateral Account; (ii) prepare and deliver to Successor Borrower and Servicer, on or before the
last day of each month, a monthly report summarizing all transactional activity in the Pledged
Collateral Account for the preceding calendar month; and (iii) advise Successor Borrower and
Servicer of receipt of any payment or of any non-payment by an Obligor of principal or interest on
account of the Pledged Collateral within two (2) Business Days of the related payment date.
Pledgor agrees that it retains, and Successor Borrower will assume, the obligation to prepare and
file all required state and federal tax reports and returns, and to pay any taxes related to its
ownership of the assets in the Pledged Collateral Account, and that all such taxes shall be paid
from sources other than the Pledged Collateral.
Section 7. Termination.
Pledgee may terminate this Agreement at any time after thirty (30) days’ prior written notice
to the other parties hereto without any cost to Pledgor; provided that upon doing so, Pledgee shall
enter into a new Account Agreement with Pledgor upon terms materially similar to this Agreement.
Pledgee may, without terminating this Agreement, replace or substitute an Eligible Institution for
Intermediary at any time after thirty (30) days’ prior written notice to the other parties hereto,
and, upon any material default by Intermediary in its obligations under the Defeasance Documents or
if any representation of Intermediary shall prove to have been inaccurate or incomplete in any
material respect when made, Pledgee may, if such default or failure of a representation shall not
have been cured within a reasonable time, terminate Intermediary’s rights under this Agreement
immediately upon written notice to Intermediary. Intermediary may resign from its obligations
under this Agreement at any time after thirty (30) days’ prior written notice to the other parties
hereto, but in no event shall Intermediary be released of its obligations as Intermediary or
Custodian hereunder unless and until a substitute Eligible Institution, satisfactory to Pledgee in
its sole and absolute discretion, has been designated and has assumed in writing the obligations of
Intermediary and Custodian hereunder at the sole cost and expense of the resigning Intermediary.
Pledgee shall designate a substitute Intermediary and Custodian, in its sole discretion, promptly
after receipt of notice of resignation by Intermediary and shall take all reasonable actions
necessary to cause such designated
successor promptly to assume the obligations of Intermediary and Custodian hereunder.
Expenses incurred in connection with (i) the transfer of Securities to a successor, (ii) the
assumption of the obligations of the Intermediary by the successor, and (iii) the portion of the
fee paid to the Intermediary that would have accrued from the date of appointment of such successor
until the Maturity Date, shall be borne by the Intermediary.
Section 8. Authority.
Any person executing this Agreement in a fiduciary or other representative capacity represents
that they have full power and authority to do so and that any applicable or required court,
partnership, corporate or other authority has been duly and properly given and continues as of the
date hereof.
Section 9. Fees and Costs.
Concurrently with the execution of this Agreement, Pledgor shall pay the sum of (a)
$17,500.00 to Servicer as a fee in connection with the Pledged Collateral Account and the services
provided hereunder by Servicer, and (b) $7,200.00 to Intermediary in full payment of all fees in
connection with the Pledged Collateral Account and the services provided hereunder by Intermediary
through the Maturity Date, provided that Successor Borrower shall be responsible for fees and costs
specified in Section 4(c) above, if applicable. Intermediary and Servicer hereby
acknowledge and confirm that any fees related to investments in the Default Permitted Investment
and wire transfers to the Collection Account or to the Successor Borrower are included in the fees
already paid to Intermediary and Servicer, respectively, pursuant to this Section 9. Such
fees have been fully earned by each of Servicer and Intermediary and are not refundable or subject
to reduction. If any additional reasonable costs or expenses are incurred by the Servicer or
Intermediary (i) in connection with the protection or preservation of Pledgee’s rights in the
Pledged Collateral or (ii) that are expressly required to be borne by the Pledgor under the terms
of the Defeasance Documents (including, without limitation, Section 4(c) hereof), Pledgor
agrees to pay all such costs and expenses within ten (10) Business Days following receipt of
written invoice therefor. Intermediary hereby acknowledges and confirms that as of the date
hereof, there are no fees charged in connection with investments in the Default Permitted
Investment. In the event Intermediary is notified that any such fees shall at any time hereafter
become payable in connection with the Default Permitted Investment, Intermediary shall promptly
give written notice to Successor Borrower, and prior to the imposition of any such fee, Successor
Borrower shall have the right, in accordance with the provisions of Section 4(c) hereof, to request
that Servicer direct Intermediary to invest and reinvest any funds in the Pledged Collateral
Account from time to time in another Permitted Investment.
Section 10. Governing Law, Venue, Attorneys’ Fees.
THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HERETO AND THEIR SUCCESSORS AND
ASSIGNS SHALL IN ALL RESPECTS BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE
LAWS OF THE STATE, INCLUDING THE UNIFORM COMMERCIAL CODE AS ADOPTED IN THE STATE BUT OTHERWISE
WITHOUT REGARD TO LAWS OF THE STATE CONCERNING CONFLICTS OF LAWS OR CHOICE OF FORUM. IN THE EVENT
OF ANY DISPUTE REGARDING THIS AGREEMENT, THE PARTIES AGREE THAT THE PREVAILING PARTY SHALL BE
ENTITLED TO SUCH COSTS AND ATTORNEYS’ FEES AS THE COURT MAY ADJUDGE REASONABLE.
PLEDGOR, PLEDGEE, SERVICER AND INTERMEDIARY HEREBY IRREVOCABLY SUBMIT TO PERSONAL JURISDICTION
IN THE STATE AND TO THE NON EXCLUSIVE JURISDICTION OF ANY NEW YORK STATE OR FEDERAL COURT SITTING
IN THE CITY OF NEW YORK OVER ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT. JURISDICTION AND VENUE OF ANY ACTION BROUGHT TO ENFORCE THIS AGREEMENT OR ANY OTHER
DEFEASANCE DOCUMENT OR ANY ACTION RELATING TO THE TRANSACTIONS CONTEMPLATED HEREBY OR THE
RELATIONSHIPS CREATED BY OR UNDER THE DEFEASANCE DOCUMENTS (“ACTION”) SHALL, AT THE ELECTION OF
PLEDGEE, BE IN (AND IF ANY ACTION IS ORIGINALLY BROUGHT IN ANOTHER VENUE, THE ACTION SHALL AT THE
ELECTION OF PLEDGEE BE TRANSFERRED TO) A STATE OR FEDERAL COURT OF APPROPRIATE JURISDICTION LOCATED
IN THE STATE. PLEDGOR, PLEDGEE, SERVICER AND INTERMEDIARY HEREBY CONSENT AND SUBMIT TO THE PERSONAL
JURISDICTION OF THE COURTS OF THE STATE AND OF FEDERAL COURTS LOCATED IN THE STATE IN CONNECTION
WITH ANY ACTION AND HEREBY WAIVE ANY AND ALL PERSONAL RIGHTS UNDER THE LAWS OF ANY OTHER STATE TO
OBJECT TO JURISDICTION WITHIN THE STATE FOR PURPOSES OF ANY ACTION. PLEDGOR, PLEDGEE, SERVICER AND
INTERMEDIARY HEREBY WAIVE AND AGREE NOT TO ASSERT, AS A DEFENSE TO ANY ACTION OR A MOTION TO
TRANSFER VENUE OF ANY ACTION, (I) ANY CLAIM THAT IT IS NOT SUBJECT TO SUCH JURISDICTION; (II) ANY
CLAIM THAT ANY ACTION MAY NOT BE BROUGHT AGAINST IT OR IS NOT MAINTAINABLE IN THOSE COURTS OR THAT
THIS AGREEMENT MAY NOT BE ENFORCED IN OR BY THOSE COURTS, OR THAT IT IS EXEMPT OR IMMUNE FROM
EXECUTION; (III) THAT THE ACTION IS BROUGHT IN AN INCONVENIENT FORUM; OR (IV) THAT THE VENUE FOR
THE ACTION IS IN ANY WAY IMPROPER.
Section 11. Severability of Provisions.
Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof or affecting the validity or
enforceability of such provision in any other jurisdiction.
Section 12. Headings.
The section headings used in this Agreement are for convenience of reference only and shall
not affect the construction of this Agreement.
Section 13. Indemnification.
Pledgor agrees to indemnify Pledgee, Intermediary and Servicer and their respective successors
and assigns (collectively, the “Indemnitees”) and hold such Indemnitees harmless
from and against any and all liabilities, losses, damages, costs and expenses of any kind,
including, without limitation, the reasonable fees and disbursements of counsel, which may be
incurred by any Indemnitee in connection with its actions hereunder or in connection with any
investigative, administrative or judicial proceedings (whether or not such Indemnitee shall be
designated a party thereto) relating to or arising out of this Agreement or the Pledged Collateral
(including, without limitation, any such proceeding by Pledgor against any Indemnitee or by any
Indemnitee against Pledgor to the extent such party seeking indemnification is the prevailing party
in such proceeding); provided that no Indemnitee shall have the right to be indemnified
hereunder for its own gross negligence (and with respect to Intermediary only, its own negligence)
or willful misconduct as determined by a court of competent jurisdiction.
Section 14. Execution in Counterparts.
This Agreement and any amendments, waivers, consents or supplements hereto may be executed in
any number of counterparts and by different parties hereto in separate counterparts, each of which
when so executed and delivered shall be deemed to be an original, but all such counterparts shall
constitute one and the same Agreement.
Section 15. Successors and Assigns.
This Agreement shall be binding upon and, subject to the restrictions on assignment by Pledgor
set forth in the Security Agreement, shall inure to the benefit of the successors and assigns of
the parties hereto. Pledgee shall have the right to assign or transfer rights and obligations
under this Agreement without limitation. Any assignee or transferee shall be entitled to all the
benefits afforded Pledgee under this Agreement; provided, that such assignee or transferee
shall have delivered to the other parties hereto written confirmation that such assignee and
transferee agrees to be bound by the terms of this Agreement and is also the assignee or transferee
of the Defeasance Documents.
Intermediary shall have the right to assign or transfer its rights and obligations hereunder
only in connection with a termination, as set forth in Section 7 or with the prior written
consent of Pledgee.
Pledgor shall have the right to assign and transfer its rights and obligations hereunder only
as permitted under the Security Agreement.
Section 16. Notices.
All notices and other communications hereunder by any party to any other party shall be given
in accordance with Section 14 of the Security Agreement. Notices and other communications to
Servicer shall be sent to the following address:
| GMAC Commercial Mortgage Corporation | ||
| ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ | ||
| ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ | ||
| Attention: CSFB Series 1998-PS2 Servicing |
Section 17. Modification in Writing.
This Agreement, and any provisions hereof, may not be modified, amended, waived, extended,
changed, discharged or terminated orally or by an act or failure to act on the part of any party
hereto, but only by an agreement in writing and signed by all of the parties hereto.
Section 18. Waiver of Trial by Jury.
PLEDGOR, PLEDGEE, SERVICER AND INTERMEDIARY EACH HEREBY AGREES NOT TO ELECT A TRIAL BY JURY OF
ANY ISSUE TRIABLE OF RIGHT BY JURY, AND WAIVES ANY RIGHT TO TRIAL BY JURY FULLY TO THE EXTENT THAT
ANY SUCH RIGHT SHALL NOW OR HEREAFTER MAY EXIST WITH REGARD TO THIS AGREEMENT OR ANY DOCUMENT
RELATED THERETO, OR ANY CLAIM, COUNTERCLAIM OR OTHER ACTION ARISING IN CONNECTION THEREWITH. THIS
WAIVER OF RIGHT TO TRIAL BY JURY IS GIVEN KNOWINGLY AND VOLUNTARILY BY PLEDGOR, PLEDGEE, SERVICER
AND INTERMEDIARY, AND IS INTENDED TO ENCOMPASS INDIVIDUALLY EACH INSTANCE AND EACH ISSUE AS TO
WHICH A RIGHT TO TRIAL BY JURY WOULD OTHERWISE ACCRUE. PLEDGOR, PLEDGEE, SERVICER AND INTERMEDIARY
EACH IS HEREBY AUTHORIZED TO FILE A COPY OF THIS SECTION IN ANY PROCEEDING AS CONCLUSIVE EVIDENCE
OF THIS WAIVER BY EACH OTHER.
(Signatures continued on next page)
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above
written.
| Pledgor: | ||||||||
| CASA MUNRAS HOTEL PARTNERS, L.P., a California limited partnership |
||||||||
| By: | Casa Munras GP, LLC, a California limited liability company, its general partner |
|||||||
| By: | /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ | |||||||
| ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ | ||||||||
| Managing Member | ||||||||
(Signatures continued on next page)
| Intermediary: | ||||||||
| ▇▇▇▇▇ FARGO BANK, N.A. | ||||||||
| By: | /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ | |||||||
| Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ | ||||||||
| Title: Vice President | ||||||||
(Signatures continued on next page)
| Pledgee: | ||||||||
| U.S. BANK NATIONAL ASSOCIATION, successor-in-interest to State Street Bank and Trust Company, as Trustee under the Pooling and Servicing Agreement, dated as of October 1, 1998, for the Registered Holders of Credit Suisse First Boston Mortgage Securities Corp., Commercial Mortgage Pass-Through Certificates, Series 1998-PS2 | ||||||||
| By: | GMAC Commercial Mortgage Corporation, successor-in-interest to AMRESCO Services, L.P., as Servicer | |||||||
| By: | /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ | |||||||
| Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ | ||||||||
| Title: Vice President | ||||||||
| Servicer: | ||||||||
| GMAC COMMERCIAL MORTGAGE CORPORATION | ||||||||
| By: | /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ | |||||||
| Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ | ||||||||
| Title: Vice President | ||||||||
EXHIBIT A
Securities
EXHIBIT B
Accountant’s Letter
EXHIBIT C
Any one or more of the following obligations or securities payable in United States Dollars on
demand or on a scheduled maturity on or before the Business Day immediately preceding the date upon
which the funds in the Pledged Collateral Account are required to be drawn, and having at all times
the required ratings, if any, provided for in this definition, unless each Rating Agency shall have
confirmed in writing to Pledgee that a lower rating would not, in and of itself, result in a
downgrade, qualification or withdrawal of the then current ratings assigned to the Certificates:
(i) obligations of, or obligations fully guaranteed as to payment of principal and
interest by, the United States or any agency or instrumentality thereof provided such
obligations are backed by the full faith and credit of the United States of America
including, without limitation, obligations of: the U.S. Treasury (all direct or fully
guaranteed obligations), the Farmers Home Administration (certificates of beneficial
ownership), the General Services Administration (participation certificates), the U.S.
Maritime Administration (guaranteed Title XI financing), the Small Business Administration
(guaranteed participation certificates and guaranteed pool certificates), the U.S.
Department of Housing and Urban Development (local authority bonds) and the Washington
Metropolitan Area Transit Authority (guaranteed transit bonds); provided,
however, that the investments described in this clause (A) must have a predetermined
fixed dollar amount of principal due at maturity that cannot vary or change, (B) if rated by
S&P, must not have an “r” highlighter affixed to their rating, (C) if such investments have
a variable rate of interest, such interest rate must be tied to a single interest rate index
plus a fixed spread (if any) and must move proportionately with that index, and (D) must not
be subject to liquidation prior to their maturity;
(ii) Federal Housing Administration debentures;
(iii) obligations of the following United States government sponsored agencies: FHLMC
(debt obligations), the Farm Credit System (consolidated systemwide bonds and notes), the
Federal Home Loan Banks (consolidated debt obligations), FNMA, the Student Loan Marketing
Association (debt obligations), the Financing Corp. (debt obligations), and the REFCO (debt
obligations); provided, however, that the investments described in this
clause (A) must have a predetermined fixed dollar amount of principal due at maturity that
cannot vary or change, (B) if rated by S&P, must not have an “r” highlighter affixed to
their rating, (C) if such investments have a variable rate of interest, such interest rate
must be tied to a single interest rate index plus a fixed spread (if any) and must move
proportionately with that index, and (D) must not be subject to liquidation prior to their
maturity;
(iv) federal funds, unsecured certificates of deposit, time deposits, bankers’
acceptances and repurchase agreements with maturities of not more than 365 days, of any
bank, the short term obligations of which are rated in the highest short term rating
category by each Rating Agency (or otherwise acceptable to each Rating Agency, as confirmed
in writing that such investment would not, in and of itself, result in a downgrade,
qualification or withdrawal of the then current ratings assigned to the
Certificates), provided, however, that the investments described in
this clause (A) must have a predetermined fixed dollar amount of principal due at maturity
that cannot vary or change, (B) if rated by S&P, must not have an “r” highlighter affixed to
their rating, (C) if such investments have a variable rate of interest, such interest rate
must be tied to a single interest rate index plus a fixed spread (if any) and must move
proportionately with that index, and (D) must not be subject to liquidation prior to their
maturity;
(v) fully Federal Deposit Insurance Corporation-insured demand and time deposits in, or
certificates of deposit of, or bankers’ acceptances issued by, any bank or trust company,
savings and loan association or savings bank, the short term obligations of which are rated
in the highest short term rating category by each Rating Agency (or otherwise acceptable to
each Rating Agency, as confirmed in writing that such investment would not, in and of
itself, result in a downgrade, qualification or withdrawal of the then current ratings
assigned to the Certificates), provided, however, that the investments
described in this clause (A) must have a predetermined fixed dollar amount of principal due
at maturity that cannot vary or change, (B) if rated by S&P, must not have an “r”
highlighter affixed to their rating, (C) if such investments have a variable rate of
interest, such interest rate must be tied to a single interest rate index plus a fixed
spread (if any) and must move proportionately with that index, and (D) must not be subject
to liquidation prior to their maturity;
(vi) debt obligations with maturities of not more than 365 days and rated “AA-” or
higher by S&P and by each Rating Agency (or otherwise acceptable to each Rating Agency, as
confirmed in writing that such investment would not, in and of itself, result in a
downgrade, qualification or withdrawal of the then current ratings assigned to the
Certificates), in its highest long-term unsecured rating category; provided,
however, that the investments described in this clause (A) must have a predetermined
fixed dollar amount of principal due at maturity that cannot vary or change, (B) if rated by
S&P, must not have an “r” highlighter affixed to their rating, (C) if such investments have
a variable rate of interest, such interest rate must be tied to a single interest rate index
plus a fixed spread (if any) and must move proportionately with that index, and (D) must not
be subject to liquidation prior to their maturity;
(vii) commercial paper (including both non-interest-bearing discount obligations and
interest-bearing obligations payable on demand or on a specified date not more than one year
after the date of issuance thereof) with maturities of not more than 365 days and that is
rated by each Rating Agency (or otherwise acceptable to each Rating Agency, as confirmed in
writing that such investment would not, in and of itself, result in a downgrade,
qualification or withdrawal of the then current ratings assigned to the Certificates), in
its highest short-term unsecured debt rating; provided, however, that the
investments described in this clause (A) must have a predetermined fixed dollar amount of
principal due at maturity that cannot vary or change, (B) if rated by S&P, must not have an
“r” highlighter affixed to their rating, (C) if such investments have a variable rate of
interest, such interest rate must be tied to a single interest rate index plus a fixed
spread (if any) and must move proportionately with that index, and (D) must not be subject
to liquidation prior to their maturity;
(viii) the Federated Prime Obligations Fund #10 CUSIP ▇▇▇▇▇▇▇▇▇, or any money market
fund (the “Fund”) so long as the Fund is rated “AAAm” or “AAAm-G” by S&P (or
otherwise acceptable to each Rating Agency), as confirmed in writing that such investment
would not, in and of itself, result in a downgrade, qualification or withdrawal of the then
current ratings assigned to the Certificates;
(ix) any other demand, money market or time deposit, demand obligation, or any other
obligation, security or investment, provided that each Rating Agency has confirmed in
writing to Lender, that such investment would not, in and of itself, result in a downgrade,
qualification or withdrawal of the then current ratings assigned to the Certificates; and
(x) such other obligations as are included in the definition of “Permitted
Investments” in the Pooling and Servicing Agreement or are otherwise acceptable as Permitted
Investments to each Rating Agency, as confirmed in writing to Pledgee, that such obligations
would not, in and of itself, result in a downgrade, qualification or withdrawal of the then
current ratings assigned to the Certificates;
provided, however, that, in the judgment of Pledgee, such instrument continues
to qualify as a “cash flow investment” pursuant to Section 860G(a)(6) of the United States Internal
Revenue Code earning a passive return in the nature of interest and provided
further that no instrument or security shall be a Permitted Investment if (i) such
instrument or security evidences a right to receive only interest payments, (ii) the right to
receive principal and interest payments derived from the underlying investment provides a yield to
maturity in excess of one hundred twenty percent (120%) of the yield to maturity at par of such
underlying investment or (iii) such investments have a maturity in excess of one year.
EXHIBIT D
All instructions and directions from Servicer to Intermediary for the Pledged Collateral
Account must be in writing, signed by a person or persons duly authorized by Servicer on behalf of
Pledgee to sign, such instructions to be in such form as Intermediary may reasonably require.
Specimen signatures of all persons to whom authority has been delegated shall be furnished. The
following employees of Servicer are authorized by Servicer on behalf of Pledgee to deliver
instructions to Intermediary hereunder:
| Name | Title | Signature | ||
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
|
Vice President | /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ | ||
| Specimen Signature | ||||
| Specimen Signature |
Servicer, acting on behalf of Pledgee shall have the right, from time to time, to change the
list of persons duly authorized to sign instructions on behalf of Pledgee. Any changes to the list
of authorized signatories shall be deemed effective upon delivery to Intermediary of written notice
regarding such changes.
EXHIBIT E
All instructions and directions from Successor Borrower to Servicer for the Pledged Collateral
Account must be in writing, signed by a person or persons duly authorized by Successor Borrower to
sign, such instructions to be in such form as Servicer may reasonably require. Specimen signatures
of all persons to whom authority has been delegated shall be furnished. The following officers of
the Manager of Successor Borrower are authorized by Successor Borrower to deliver instructions to
Servicer hereunder:
| Name | Title | Signature | ||
| /s/ ▇. ▇▇▇▇▇▇ | ||||
| Specimen Signature | ||||
| Z. ZORLY [sic] | ||||
| Specimen Signature | ||||
| Specimen Signature |
Successor Borrower shall have the right, from time to time, to change the list of persons duly
authorized to sign instructions on behalf of Successor Borrower. Any changes to the list of
authorized signatories shall be deemed effective upon delivery to Servicer of written notice
regarding such changes.
EXHIBIT F
(Collection Account)
Escrow Bank USA
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
ABA # ▇▇▇-▇▇▇-▇▇▇
Credit To: GMAC Commercial Mortgage Corporation
Account # ▇▇▇▇▇▇▇▇ [“A” Library Deals – Delete on “N” Library Deals]
Account # ▇▇▇▇▇▇▇▇ [“N” Library Deals – Delete on “A” Library Deals]
Reference: Loan # ▇▇-▇▇▇▇▇▇▇ – (Casa Munras Hotel Partners, L.P.)
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
ABA # ▇▇▇-▇▇▇-▇▇▇
Credit To: GMAC Commercial Mortgage Corporation
Account # ▇▇▇▇▇▇▇▇ [“A” Library Deals – Delete on “N” Library Deals]
Account # ▇▇▇▇▇▇▇▇ [“N” Library Deals – Delete on “A” Library Deals]
Reference: Loan # ▇▇-▇▇▇▇▇▇▇ – (Casa Munras Hotel Partners, L.P.)