PRUDENTIAL SECURITIES SECURED FINANCING CORPORATION
DEPOSITOR
,
SERVICER
,
SPECIAL SERVICER
,
TRUSTEE
and
,
FISCAL AGENT
POOLING AND SERVICING AGREEMENT
Dated as of
Commercial Mortgage Pass-Through Certificates
Series
TABLE OF CONTENTS
PAGE
ARTICLE I
DEFINITIONS
SECTION 1.1. Defined Terms................................................................. 3
SECTION 1.2. Certain Calculations.......................................................... 39
SECTION 1.3. Certain Constructions......................................................... 40
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
SECTION 2.1. Conveyance and Assignment of Mortgage Loans;.................................. 41
SECTION 2.2. Acceptance by the Custodian and the Trustee................................... 45
SECTION 2.3. Representations and Warranties of the Depositor............................... 47
SECTION 2.4. Representations, Warranties and Covenants of the
Servicer and the Special Servicer............................................. 51
SECTION 2.5. Execution and Delivery of Certificates; Issuance of
Lower-Tier Regular Interests.................................................. 54
SECTION 2.6. Miscellaneous REMIC Provisions................................................ 54
SECTION 2.7. Documents Not Delivered to Custodian.......................................... 55
ARTICLE III
ADMINISTRATION AND SERVICING
OF THE MORTGAGE LOANS
SECTION 3.1. Servicer to Act as Servicer; Special Servicer to Act as
Special Servicer; Administration of the Mortgage
Loans......................................................................... 56
SECTION 3.2. Liability of the Servicer..................................................... 59
SECTION 3.3. Collection of Certain Mortgage Loan Payments.................................. 60
SECTION 3.4. Collection of Taxes, Assessments and Similar Items............................ 60
SECTION 3.5. Collection Account; Distribution Account...................................... 62
SECTION 3.6. Permitted Withdrawals from the Collection Account............................. 63
SECTION 3.7. Investment of Funds in the Collection Account, the
Distribution Account and the Reserve Accounts................................. 65
SECTION 3.8. Maintenance of Insurance Policies and Errors and
Omissions and Fidelity Coverage............................................... 67
SECTION 3.9. Enforcement of Due-On-Sale Clauses; Assumption
Agreements.................................................................... 70
SECTION 3.10. Realization Upon Mortgage Loans............................................... 72
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PAGE
SECTION 3.11. Trustee to Cooperate; Release of Mortgage Files............................... 76
SECTION 3.12. Servicing Compensation and Trustee Fees....................................... 77
SECTION 3.13. Reports to the Trustee; Collection Account Statements......................... 79
SECTION 3.14. Annual Statement as to Compliance............................................. 79
SECTION 3.15. Annual Independent Public Accountants' Servicing
Report........................................................................ 80
SECTION 3.16. Access to Certain Documentation............................................... 80
SECTION 3.17. Title and Management of REO Properties........................................ 81
SECTION 3.18. Sale of Specially Serviced Mortgage Loans and REO
Properties.................................................................... 84
SECTION 3.19. Inspections................................................................... 86
SECTION 3.20. Available Information and Notices............................................. 86
SECTION 3.21. Reserve Accounts.............................................................. 88
SECTION 3.22. Property Advances............................................................. 88
SECTION 3.23. Appointment of Special Servicer............................................... 89
SECTION 3.24. Transfer of Servicing Between Servicer and Special
Servicer; Record Keeping...................................................... 89
SECTION 3.25. Adjustment of Servicing Compensation in Respect of
Prepayment Interest Shortfalls................................................ 91
SECTION 3.26. Extension Advisor............................................................. 92
ARTICLE IV
DISTRIBUTIONS TO CERTIFICATEHOLDERS
SECTION 4.1. Distributions................................................................. 93
SECTION 4.2. Statements to Rating Agencies and Certificateholders;
Available Information; Information Furnished to
Financial Market Publisher....................................................109
SECTION 4.3. Compliance with Withholding Requirements......................................112
SECTION 4.4. REMIC Compliance..............................................................112
SECTION 4.5. Imposition of Tax on the Trust Fund...........................................114
SECTION 4.6. Remittances; P&I Advances.....................................................115
ARTICLE V
THE CERTIFICATES
SECTION 5.1. The Certificates..............................................................118
SECTION 5.2. Registration, Transfer and Exchange of Certificates...........................119
SECTION 5.3. Book-Entry Certificates.......................................................124
SECTION 5.4. Mutilated, Destroyed, Lost or Stolen Certificates.............................125
SECTION 5.5. Appointment of Paying Agent...................................................126
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PAGE
SECTION 5.6. Access to Certificateholders' Names and Addresses.............................126
SECTION 5.7. Actions of Certificateholders.................................................127
ARTICLE VI
THE DEPOSITOR, THE SERVICER AND THE SPECIAL SERVICER
SECTION 6.1. Liability of the Depositor, the Servicer and the Special
Servicer......................................................................128
SECTION 6.2. Merger or Consolidation of the Servicer and Special
Servicer......................................................................128
SECTION 6.3. Limitation on Liability of the Depositor, the Servicer
and Others....................................................................128
SECTION 6.4. Limitation on Resignation of the Servicer and of the
Special Servicer..............................................................129
SECTION 6.5. Rights of the Depositor and the Trustee in Respect of
the Servicer and the Special Servicer.........................................130
ARTICLE VII
DEFAULT
SECTION 7.1. Events of Default.............................................................131
SECTION 7.2. Trustee to Act; Appointment of Successor......................................133
SECTION 7.3. Notification to Certificateholders............................................134
SECTION 7.4. Other Remedies of Trustee.....................................................134
SECTION 7.5. Waiver of Past Events of Default; Termination.................................135
ARTICLE VIII
CONCERNING THE TRUSTEE
SECTION 8.1. Duties of Trustee.............................................................136
SECTION 8.2. Certain Matters Affecting the Trustee.........................................137
SECTION 8.3. Trustee Not Liable for Certificates or Mortgage Loans.........................139
SECTION 8.4. Trustee May Own Certificates..................................................141
SECTION 8.5. Payment of Trustee's Fees and Expenses;
Indemnification...............................................................141
SECTION 8.6. Eligibility Requirements for Trustee..........................................142
SECTION 8.7. Resignation and Removal of the Trustee........................................143
SECTION 8.8. Successor Trustee.............................................................144
SECTION 8.9. Merger or Consolidation of Trustee............................................145
SECTION 8.10. Appointment of Co-Trustee or Separate Trustee.................................145
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PAGE
SECTION 8.11. Authenticating Agent..........................................................147
SECTION 8.12. Appointment of Custodians.....................................................147
SECTION 8.13. Fiscal Agent Appointed; Concerning the Fiscal Agent...........................148
ARTICLE IX
TERMINATION
SECTION 9.1. Termination...................................................................149
SECTION 9.2. Additional Termination Requirements...........................................153
ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.1. Counterparts..................................................................155
SECTION 10.2. Limitation on Rights of Certificateholders....................................155
SECTION 10.3. Governing Law.................................................................156
SECTION 10.4. Notices.......................................................................156
SECTION 10.5. Severability of Provisions....................................................158
SECTION 10.6. Notice to the Depositor and Each Rating Agency................................158
SECTION 10.7. Amendment.....................................................................159
SECTION 10.8. Confirmation of Intent........................................................161
iv
EXHIBITS
Exhibit A-1 Form of Class Certificate
Exhibit A-2 Form of Class Certificate
Exhibit A-3 Form of Class Certificate
Exhibit A-4 Form of Class Certificate
Exhibit A-5 Form of Class Certificate
Exhibit A-6 Form of Class Certificate
Exhibit A-7 Form of Class Certificate
Exhibit A-8 Form of Class Certificate
Exhibit A-9 Form of Class Certificate
Exhibit A-10 Form of Class Certificate
Exhibit A-11 Form of Class Certificate
Exhibit A-12 Form of Class Certificate
Exhibit A-13 Form of Class Certificate
Exhibit A-14 Form of Class Certificate
Exhibit B Mortgage Loan Schedule
Exhibit C-1 Form of Transferee Affidavit
Exhibit C-2 Form of Transferor Letter
Exhibit D-1 Form of Investment Representation Letter
Exhibit D-2 Form of ERISA Representation Letter
Exhibit E Form of Request for Release
Exhibit F Form of Custodial Agreement
Exhibit G Form of Mortgage Loan Purchase and Sale Agreement
Exhibit H Privately Placed Securities Legend
v
Pooling and Servicing Agreement, dated as of
among Prudential Securities Secured Financing Corporation, as
Depositor, , as Servicer, , as Special Servicer,
, as Trustee and Custodian, and , as Fiscal
Agent of the Trustee.
PRELIMINARY STATEMENT:
(Terms used but not defined in this Preliminary Statement shall have the
meanings specified in Article I hereof)
The Depositor intends to sell pass-through certificates to
be issued hereunder in multiple classes which in the aggregate will evidence
the entire beneficial ownership interest in the Trust Fund consisting
primarily of the Mortgage Loans. As provided herein, the Trustee will elect
that the Trust Fund be treated for federal income tax purposes as two separate
real estate mortgage investment conduits (each a "REMIC" or, in the
alternative, the "Lower-Tier REMIC" and the "Upper-Tier REMIC," respectively).
The Class , Class , Class , Class , Class , Class , Class
, Class , Class , Class , Class and Class
Certificates constitute "regular interests" in the Upper-Tier REMIC and
the Class __ Certificates are the sole class of "residual interest" in the
Upper-Tier REMIC for purposes of the REMIC Provisions. The Class Certificates
are the sole class of "residual interest" in the Lower-Tier REMIC for purposes
of the REMIC Provisions. There are also ten classes of uncertificated
Lower-Tier Regular Interests issued under this Agreement (the Class
Interests), each of which will constitute a regular interest in the Lower-Tier
REMIC. All such Lower-Tier Regular Interests will be held by the Trustee as
assets of the Upper-Tier REMIC.
1
The following table sets forth the designation and aggregate
initial Certificate Balance (or, with respect to the Class ___ and Class ___
Certificates, the Class ___ Notional Balance and the Class ___ Notional Balance,
respectively) for each Class of Certificates comprising interests in the
Upper-Tier REMIC.
Certificate Balance
Class or Notional Balance
----- -------------------
(1) The Class __ and Class __ Certificates are not denominated in
Certificate Balance and accordingly will not receive principal
distributions. The Class __ and Class __ Certificates have an initial
Class __ Notional Balance and an initial Class __ Notional Balance,
respectively, in the amounts shown in the above table.
The initial Certificate Balance of each of the Class __ and
Class __ Certificates will be zero. The Certificate Balance of any class of
Certificates outstanding at any time represents the maximum amount which
holders thereof are entitled to receive as distributions allocable to
principal from the cash flow on the Mortgage Loans and the other assets in the
Trust Fund.
As of the Cut-off Date, the Mortgage Loans have an aggregate
Scheduled Principal Balance equal to approximately $ .
In consideration of the mutual agreements herein contained,
the Depositor, the Servicer, the Special Servicer, the Trustee and the Fiscal
Agent agree as follows:
2
ARTICLE I
DEFINITIONS
SECTION 1.1. Defined Terms.
Whenever used in this Agreement, the following words and
phrases, unless the context otherwise requires, shall have the meanings
specified in this Article.
"Advance": Any P&I Advance or Property Advance.
"Advance Interest Amount": The sum for all Mortgage Loans as
to which any Advance remains unreimbursed of interest at the related Advance
Rate on the amount of any P&I Advances and Property Advances for which the
Servicer, the Trustee or the Fiscal Agent, as applicable, has not been paid or
reimbursed for the number of days from the date on which such Advance was made
or, if interest has been previously paid on such Advance, from the date on
which interest was last paid, through the date of payment or reimbursement of
the related Advance (which in no event shall be later than the Determination
Date following the date on which funds are available to reimburse such Advance
with interest thereon at the Advance Rate).
"Advance Rate": A per annum rate equal to the Prime Rate (as
published in The Wall Street Journal, or, if The Wall Street Journal is no
longer published, The New York Times, from time to time).
"Affiliate": With respect to any specified Person, any other
Person controlling or controlled by or under common control with such
specified Person. For the purposes of this definition, "control" when used
with respect to any specified Person means the power to direct the management
and policies of such Person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise, and the terms
"controlling" and "controlled" have meanings correlative to the foregoing. The
Trustee may obtain and rely on an Officer's Certificate of the Servicer, the
Special Servicer or the Depositor to determine whether any Person is an
Affiliate of such party.
"Aggregate Certificate Balance": As defined in Section
9.1(d)(i).
"Agreement": This Pooling and Servicing Agreement and all
amendments hereof and supplements hereto.
"Annual Debt Service": For any Mortgage Loan, the current
annual debt service (including interest allocable to payment of the Servicing
Fee) payable with respect to such Mortgage Loan during the 12-month period
commencing on the Cut-off Date (assuming no principal prepayments occur).
"Anticipated Loss": As defined in Section 4.6(c).
3
"Anticipated Termination Date": Any Distribution Date on
which it is anticipated that the Trust Fund will be terminated pursuant to
Section 9.1(c) or Section 9.1(d).
"Applicable Monthly Payment": As defined in Section 4.6(a).
"Applicant": As defined in Section 5.6(a).
"Appraised Value": For each of the Mortgaged Properties, the
appraised value of such property as determined by an appraisal thereof,
conforming to MAI standards, made not more than one year prior to the
origination date of the related Mortgage Loan.
"Assignment of Leases, Rents and Profits": With respect to
any Mortgaged Property, any assignment of leases, rents and profits or similar
agreement executed by the Borrower, assigning to the mortgagee all of the
income, rents and profits derived from the ownership, operation, leasing or
disposition of all or a portion of such Mortgaged Property, in the form which
was duly executed, acknowledged and delivered by the Borrower, as amended,
modified, renewed or extended through the date hereof and from time to time
hereafter.
"Assignment of Mortgage": An assignment of mortgage without
recourse, notice of transfer or equivalent instrument, in recordable form,
which is sufficient under the laws of the jurisdiction in which the related
Mortgaged Property is located to reflect of record the sale of the related
Mortgage, which assignment, notice of transfer or equivalent instrument may be
in the form of one or more blanket assignments covering Mortgages encumbering
Mortgaged Properties located in the same jurisdiction, if permitted by law and
acceptable for recording; provided, however, that none of the Trustee, the
Custodian, the Special Servicer or the Servicer shall be responsible for
determining whether any assignment is legally sufficient or in recordable
form.
"Assumed Scheduled Payment": With respect to any Mortgage
Loan that is delinquent in respect of its Balloon Payment (including any REO
Mortgage Loan as to which the Balloon Payment would have been past due), an
amount equal to the sum of (a) the principal portion of the Monthly Payment
that would have been due on such Mortgage Loan on a Due Date that falls on or
after the date on which such Balloon Payment was due, based on the original
amortization schedule thereof, assuming such Balloon Payment had not become
due, after giving effect to any modification, and (b) interest at the
applicable Net Mortgage Rate on the principal balance that would have remained
on such Mortgage Loan after giving effect to deemed principal payments
pursuant to clause (a) hereof on prior Due Dates.
"Assumption Fees": Any fees collected by the Servicer or the
Special Servicer in connection with an assumption or modification of a
Mortgage Loan or substitution of a Borrower thereunder permitted to be
executed under the provisions of Section 3.1, Section 3.9 or Section 3.10.
"Auction Agent": An Independent financial advisory or
investment banking or investment brokerage firm nationally recognized in the
field of real estate financial analysis and auction procedures appointed by
the Trustee pursuant to Section 9.1(d).
4
"Auction Fees": As defined in Section 9.1(d)(v).
"Auction Procedures": As defined in Section 9.1(d)(vi).
"Auction Proceeds Distribution Date": The third Distribution
Date following an Auction Valuation Date, or such later Distribution Date
determined by the Auction Agent.
"Auction Valuation Date": Each of (i) the Distribution Date
occurring in September of each year from and including __________ and (ii) any
Business Day on which the Trustee receives an unsolicited bona fide offer to
purchase all (but not less than all) of the Mortgage Loans.
"Authenticating Agent": Any authenticating agent appointed
by the Trustee pursuant to Section 8.11.
"Balloon Payment": With respect to each Mortgage Loan, the
scheduled payment of principal and interest due on the Maturity Date of such
Mortgage Loan which, pursuant to the related Note, is equal to the entire
remaining principal balance of such Mortgage Loan, plus accrued interest
thereon.
"Borrower": With respect to each Mortgage Loan, any obligor
on any related Note (or, in the case of the Interest, the
Certificate, to the extent applicable).
"Book-Entry Certificate": Any Certificate registered in the
name of the Securities Depository or its nominee.
"Business Day": Any day other than a Saturday, a Sunday or a
day on which banking institutions in the States of New York, Illinois or
__________ are authorized or obligated by law, executive order or governmental
decree to be closed.
"Cash Deposit": An amount equal to all cash payments of
principal and interest received by the Mortgage Loan Seller in respect of the
Mortgage Loans prior to or on the Closing Date which are due after the Cut-off
Date, which amount is to be deposited with the Trustee by the Depositor
pursuant to Section 2.1.
"Certificate": Any Class ___ Certificate issued,
authenticated and delivered hereunder.
"Certificate Balance": With respect to any Class of Regular
Certificates (other than the Class ___ and Class ___ Certificates) (a) on or
prior to the first Distribution Date, an amount equal to the aggregate initial
Certificate Balance of such Class, as specified in the Preliminary Statement
hereto, and (b) as of any date of determination after the first Distribution
Date, the Certificate Balance of such Class of Certificates on the Distribution
Date immediately prior to such date of determination, after application of the
distributions and Realized Losses made thereon on such prior Distribution Date;
and with respect to any Lower-
5
Tier Regular Interest, (a) on or prior to the first Distribution Date, an
amount equal to the Certificate Balance of the Related Certificates, and (b) as
of any date of determination after the first Distribution Date, the Certificate
Balance of such Lower-Tier Regular Interest on the Distribution Date
immediately prior to such date of determination, after application of
distributions in respect of principal and Realized Losses made thereon on such
prior Distribution Date. The Class ___ and Class ___ Certificates have no
Certificate Balances.
"Certificate Owner": With respect to a Book-Entry
Certificate, the Person who is the beneficial owner of such Certificate as
reflected on the books of the Securities Depository or on the books of a
Securities Depository Participant or on the books of an indirect participating
brokerage firm for which a Securities Depository Participant acts as agent.
"Certificate Register" and "Certificate Registrar": The
register maintained and the registrar appointed pursuant to Section 5.2(a).
"Certificateholder": A Person whose name is registered in
the Certificate Register; provided, however, that any Certificate held or
beneficially owned by the Depositor, the Servicer, the Trustee, a Manager or a
Borrower or any Person known to a Responsible Officer of the Certificate
Registrar to be an Affiliate of any thereof shall be deemed not to be
outstanding and the Voting Rights to which it is entitled shall not be taken
into account in determining whether the requisite percentage of Voting Rights
necessary to effect any consent has been obtained (unless such consent is to
an action which would materially adversely affect in any material respect the
interests of the Certificateholders of any Class, while the Servicer or any
Affiliate thereof is the holder of Certificates aggregating not less than
_____% of the Percentage Interest of any such Class). All references herein to
"Holders" or "Certificateholders" shall reflect the rights of Certificate
Owners as they may indirectly exercise such rights through the Securities
Depository and the Securities Depository Participants, except as otherwise
specified herein.
"Class": With respect to Certificates or Lower-Tier Regular
Interests, all of the Certificates or Lower-Tier Regular Interests bearing the
same alphabetical and numerical class designation.
"Class ___ Certificate": Any one of the Certificates executed
and authenticated by the Trustee or the Authenticating Agent on behalf of the
Depositor in substantially the form set forth in Exhibit ___ hereto.
"Class ___ Pass-Through Rate": A per annum rate equal to
%.
6
"Class ___ Certificate": Any one of the Certificates
executed and authenticated by the Trustee or the Authenticating Agent on
behalf of the Depositor in substantially the form set forth in Exhibit ___
hereto.
"Class ___ Pass-Through Rate": A per annum rate equal to
%.
"Class ____ Certificate": Any one of the Certificates
executed and authenticated by the Trustee or the Authenticating Agent on behalf
of the Depositor in substantially the form set forth in Exhibit ___ hereto.
"Class ____ Excess Interest": With respect to any
Distribution Date, an amount equal to the Class ___ Pass-Through Rate
multiplied by the Class ___ Notional Balance. Class ___ Excess Interest
represents a portion of the interest payments on the Interest.
"Class _____ Notional Balance": As of any date of
determination, an amount equal to the sum of (i) the Class ___ Notional
Component ___ and (ii) the Certificate Balances of the Class ___ Certificates,
the Class ___ Certificates, the Class ___ Certificates, the Class ___
Certificates, the Class ___ Certificates, the Class ___ Certificates, the
Class ___ Certificates and the Class ___ Certificates.
"Class ____ Notional Component A": As of any date of
determination, an amount equal to the sum of the Certificate Balances of the
Class _______ Certificates and the Class ___ Certificates.
"Class ____ Pass-Through Rate": With respect to any Interest
Accrual Period, a per annum rate equal to the excess of the Weighted Average
Net Mortgage Rate over the weighted averages of the Pass-Through Rates of the
P&I Certificates (weighted in each case on the basis of a fraction equal to the
Certificate Balance of each such Class of Certificates divided by the sum
_____ of the Certificate Balances of the P&I Certificates and the Class ___
Certificates as of the first day of such Interest Accrual Period) and the
Class ___ Pass-Through Rate (weighted on the basis of a fraction equal to the
Class ___ Notional Balance divided by the sum of the Certificate Balances of
the P&I Certificates and the Class ___ Certificates, each as of the first day
of such Interest Accrual Period). For purposes of this definition, the
Pass-Through Rates of the Class ___, Class ___ and Class ___ Certificates
shall be equal to the Weighted Average Net Mortgage Rate.
"Class _____ Interest": A regular interest in the Lower-Tier
REMIC entitled to monthly distributions payable thereto pursuant to Section
4.1.
"Class _____ Interest": A regular interest in the Lower-Tier
REMIC entitled to monthly distributions payable thereto pursuant to Section
4.1.
"Class ___ Certificate": Any one of the Certificates
executed and authenticated by the Trustee or the Authenticating Agent on
behalf of the Depositor in substantially the form set forth in Exhibit ____
hereto.
"Class ___ Pass-Through Rate": A per annum rate equal to
%
"Class ___ Interest": A regular interest in the Lower-Tier
REMIC entitled to the monthly distributions payable thereto pursuant to
Section 4.1.
7
"Class __ Certificate": Any one of the Certificates executed
and authenticated by the Trustee or the Authenticating Agent on behalf of the
Depositor in substantially the form set forth in Exhibit ___ hereto.
"Class ___ Pass-Through Rate": A per annum rate equal to
___%.
"Class ___ Interest": A regular interest in the Lower-Tier
REMIC entitled to the monthly distributions payable thereto pursuant to
Section 4.1.
"Class ___ Certificate": Any one of the Certificates
executed and authenticated by the Trustee or the Authenticating Agent on
behalf of the Depositor in substantially the form set forth in Exhibit ___
hereto.
"Class __ Pass-Through Rate": A per annum rate equal to
_____%.
"Class ___ Interest": A regular interest in the Lower-Tier
REMIC entitled to the monthly distributions payable thereto pursuant to
Section 4.1.
"Class ___ Certificate": Any one of the Certificates
executed and authenticated by the Trustee or the Authenticating Agent on
behalf of the Depositor in substantially the form set forth in Exhibit ___
hereto.
"Class ___ Pass-Through Rate": With respect to any Interest
Accrual Period, a per annum rate equal to ___%.
"Class ___ Interest": A regular interest in the Lower-Tier
REMIC entitled to the monthly distributions payable thereto pursuant to
Section 4.1.
"Class ___ Certificate": Any one of the Certificates
executed and authenticated by the Trustee or the Authenticating Agent on
behalf of the Depositor in substantially the form set forth in Exhibit ___
hereto.
"Class ___ Pass-Through Rate": With respect to any Interest
Accrual Period, a per annum rate equal to the higher of (i) the Weighted
Average Net Mortgage Rate and (ii) ____%
"Class ___ Interest": A regular interest in the Lower-Tier
REMIC entitled to the monthly distributions payable thereto pursuant to
Section 4.1.
"Class ___ Certificate": Any one of the Certificates
executed and authenticated by the Trustee or the Authenticating Agent on
behalf of the Depositor in substantially the form set forth in Exhibit hereto.
"Class ___ Pass-Through Rate": With respect to any Interest
Accrual Period, a per annum rate equal to the higher of (i) the Weighted
Average Net Mortgage Rate and (ii) ____%.
8
"Class ___ Interest": A regular interest in the Lower-Tier
REMIC entitled to the monthly distributions payable thereto pursuant to
Section .
"Class ___ Certificate": Any one of the Certificates
executed and authenticated by the Trustee or the Authenticating Agent on
behalf of the Depositor in substantially the form set forth in Exhibit hereto.
"Class ___ Pass-Through Rate": With respect to any Interest
Accrual Period, a per annum rate equal to the higher of (i) the Weighted
Average Net Mortgage Rate and (ii) .
"Class ___ Interest": A regular interest in the Lower-Tier
REMIC entitled to the monthly distributions payable thereto pursuant to
Section 4.1.
"Class Interest Distribution Amount": With respect to any
Distribution Date and any of the Class ____ Certificates, interest for the
related Interest Accrual Period at the applicable Pass-Through Rate for such
Class of Certificates for such Interest Accrual Period on the Certificate
Balance of such Class. With respect to any Distribution Date and the Class
____ Certificates, (a) for any Distribution Date occurring on or prior to the
EC Maturity Date, the Class ____ Excess Interest and, (b) thereafter, zero.
With respect to the Class ____ Certificates, zero. With respect to any
Distribution Date and the Class Certificates, an amount equal to the product
of the Class Pass-Through Rate and the Class ____ Notional Balance. The Class
Interest Distribution Amount of the Class ____ Certificates represents a
specified portion equal to ____% of the interest payments on the Class ____
Interest. For purposes of determining any Class Interest Distribution Amount,
any distributions in reduction of Certificate Balance, any reductions of
Certificate Balance (and any resulting reductions in Notional Balance) as a
result of allocations of Realized Losses on the Distribution Date occurring in
such Interest Accrual Period shall be deemed to have been made as of the first
day of such Interest Accrual Period. Notwithstanding the foregoing, the Class
Interest Distribution Amount for each Class of Certificates otherwise
calculated as described above shall be reduced by such Class pro rata share of
any Uncovered Prepayment Interest Shortfall for such Distribution Date (pro
rata according to each respective Class' Class Interest Distribution Amount
determined without regard to this sentence).
"Class Interest Shortfall": On any Distribution Date for any
Class of Certificates, the excess, if any, of the Class Interest Distribution
Amount for such Class over the amount of interest actually distributed in
respect of such Class Interest Distribution Amount to the Holders of such
Certificates pursuant to Section 4.1(b) on such Distribution Date.
"Class ___ Certificate": Any one of the Certificates
executed and authenticated by the Trustee or Authenticating Agent on behalf of
the Depositor in substantially the form set forth in Exhibit hereto.
"Class ___ Certificate": Any one of the Certificates
executed and authenticated by the Trustee or Authenticating Agent on behalf of
the Depositor in substantially the form set forth in Exhibit hereto.
9
"Class ___ Notional Balance": As of any date of
determination, an amount equal to the Certificate Principal Balance of the
Class Certificates.
"Class ___ Pass-Through Rate": With respect to any Interest
Accrual Period, a per annum rate equal to the Weighted Average Net Mortgage
Rate.
"Class ___ Interest": A regular interest in the Lower-Tier
REMIC entitled to the monthly distributions payable thereto pursuant to
Section 4.1.
"Class ___ Certificate": Any Certificate executed and
authenticated by the Trustee or the Authenticating Agent on behalf of the
Depositor in substantially the form set forth in Exhibit ____ hereto. The
Class __ Certificates have no Pass-Through Rate or Certificate Balance.
"Class ___ Certificate": Any Certificate executed and
authenticated by the Trustee or the Authenticating Agent on behalf of the
Depositor in substantially the form set forth in Exhibit ___ hereto. The Class
__ Certificates have no Pass-Through Rate or Certificate Balance.
"Closing Date": .
"Code": The Internal Revenue Code of 1986, as amended from
time to time, any successor statute thereto, and any temporary or final
regulations of the United States Department of the Treasury promulgated
pursuant thereto.
"Collection Account": The segregated account or accounts
created and maintained by the Servicer pursuant to Section 3.5(a), which shall
be entitled " ____ , as Trustee, in trust for Holders of Prudential Securities
Secured Financing Corporation, Commercial Mortgage Pass-Through Certificates,
Series __________ , Collection Account" and which shall be an Eligible Account.
"Collection Period": With respect to any Distribution Date
and any Mortgage Loan other than the ______ Interest, the period beginning on
the first day following the Determination Date in the month preceding the
month in which such Distribution Date occurs (or, in the case of the
Distribution Date occurring in _____ , on the day after the Cut-off Date) and
ending on the Determination Date in the month in which such Distribution Date
occurs, and with respect to any Distribution Date and the _____ Interest, the
period beginning on the first day following the remittance date under the
Prior Pooling and Servicing Agreement in the month preceding the month in
which such Distribution Date occurs (or, in the case of the Distribution Date
occurring in _____ , on the day after the Cut-off Date) and ending on the
remittance date under the prior Pooling and Servicing Agreement in the month
in which such Distribution Date occurs.
"Commission": The Securities and Exchange Commission of the
United States of America.
10
"Condemnation Proceeds": Any amount (other than Insurance
Proceeds) received in connection with the taking of a Mortgaged Property by
exercise of the power of eminent domain or condemnation.
"Corporate Trust Office": The principal office of the
Trustee located at _________________________________________________________,
Attention: Asset Backed Securities Trust Services Dept., or the principal
trust office of any successor trustee qualified and appointed pursuant to
Section 8.8.
"Custodial Agreement": The Custodial Agreement, if any, in
effect from time to time between the Custodian named therein, the Servicer and
the Trustee, substantially in the form of Exhibit __ hereto, as the same may
be amended or modified from time to time in accordance with the terms thereof.
"Custodian": Any Custodian appointed pursuant to Section
8.12 and, unless the Trustee is Custodian, named pursuant to any Custodial
Agreement. The Custodian may (but need not) be the Trustee or the Servicer or
any Affiliate of the Trustee or the Servicer, but may not be the Depositor or
any Affiliate of the Depositor.
"Cut-off Date": _____________________ ; provided, however,
that references to the principal balance of Mortgage Loans No. _______________
and _______________ (or other terms derived in part by reference to the
principal of balance of such Mortgage Loans) as of the Cut-off Date shall refer
to the principal balance of such Mortgage Loans as of __________ references to
the principal balance of Mortgage Loans No. _________________ , ___________ and
____________________ (or other terms derived in part by reference to the
principal of balance of such Mortgage Loans) as of the Cut-off Date shall refer
to the principal balance of such Mortgage Loan as of _____________.
"Debt Service Coverage Ratio": With respect to any Mortgage
Loan, (a) the Underwritten Cash Flow for the related Mortgaged Property,
divided by (b) the Annual Debt Service for such Mortgage Loan.
"Default Interest": With respect to any Mortgage Loan,
interest accrued on such Mortgage Loan at the excess of the Default Rate over
the Mortgage Rate.
"Default Rate": With respect to each Mortgage Loan, the
annual rate at which interest accrues on such Mortgage Loan following any
event of default on such Mortgage Loan, including a default in the payment of
a Monthly Payment or a Balloon Payment, as such rate is set forth in the
Mortgage Loan Schedule.
"Deficient Auction Bid": As defined in Section 9.1(d)(iii).
"Definitive Certificate": As defined in Section 5.3(a).
"Depositor": Prudential Securities Secured Financing
Corporation, a Delaware corporation and its successors and assigns.
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"Determination Date": The ___ day of any month, or if such
____ day is not a Business Day, the Business Day immediately following such
____ day, commencing .
"Directly Operate": With respect to any REO Property, the
furnishing or rendering of services to the tenants thereof that are not
customarily provided to tenants in connection with the rental of space for
occupancy only within the meaning of Treasury Regulations Section
1.512(h)-1(c)(5), the management or operation of such REO Property, the
holding of such REO Property primarily for sale to customers or any use of
such REO Property in a trade or business conducted by the Trust Fund other
than through an Independent Contractor; provided, however, that the Servicer,
on behalf of the Trust Fund (or the Special Servicer on behalf of the Trust
Fund), shall not be considered to Directly Operate an REO Property solely
because the Servicer, on behalf of the Trust Fund (or the Special Servicer on
behalf of the Trust Fund), establishes rental terms, chooses tenants, enters
into or renews leases, deals with taxes and insurance, or makes decisions as
to repairs or capital expenditures with respect to such REO Property.
"Discount Rate": The rate determined by the Trustee in
connection with distributions pursuant to Section 4.1(c)(I) to be the rate
(interpolated and rounded to the nearest one-thousandth of a percent, if
necessary) in the secondary market on the United States Treasury security with
a maturity equal to the then-computed weighted average life of the related
Class of Certificates (rounded to the nearest month) (without taking into
account the related prepayment and assuming (i) no further prepayments on the
Mortgage Loans and (ii) no delinquencies or defaults with respect to payments
on the Mortgage Loans) plus ____% per annum.
"Disposition Fee": With respect to any Specially Serviced
Mortgage Loan or REO Property which is sold or transferred or otherwise
liquidated, an amount equal to the product of (I) the excess, if any of (a)
the Liquidation Proceeds of such Specially Serviced Mortgage Loan or REO
Property minus (b) any broker's commission and related brokerage referral
fees, times (II) (a) ___%, if such sale or liquidation occurs prior to ___
months following the date on which the related Mortgage Loan initially became
a Specially Serviced Mortgage Loan, or (b) ___%, if such sale or liquidation
occurs upon or after the expiration of such ___ -month period.
"Disqualified Non-U.S. Person": With respect to a Class ___
or Class ___ Certificate, any Non-U.S. Person or agent thereof other than (i)
a Non-U.S. Person that holds the Class ___ or Class ___ Certificate in
connection with the conduct of a trade or business within the United States
and has furnished the transferor and the Certificate Registrar with an
effective IRS Form 4224 or (ii) a Non-U.S. Person that has delivered to both
the transferor and the Certificate Registrar an Opinion of Counsel to the
effect that the transfer of the Class ___ or Class ___ Certificate to it is in
accordance with the requirements of the Code and the regulations promulgated
thereunder and that such transfer of the Class ___ or Class ___ Certificate
will not be disregarded for federal income tax purposes.
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"Disqualified Organization": Either (a) the United States, a
State or any political subdivision thereof, any possession of the United
States, or any agency or instrumentality of any of the foregoing (other than
an instrumentality that is a corporation if all of its activities are subject
to tax and a majority of its board of directors is not selected by any such
governmental unit), (b) a foreign government, International Organization or
agency or instrumentality of either of the foregoing, (c) an organization that
is exempt from tax imposed by Chapter 1 of the Code (including the tax imposed
by Code Section 511 on unrelated business taxable income) on any excess
inclusions (as defined in Code Section 860E(c)(1)) with respect to the Class
__ or Class __ Certificates (except certain farmers' cooperatives described in
Code Section 521), (d) rural electric and telephone cooperatives described in
Code Section 1381(a)(2), or (e) any other Person so designated by the
Certificate Registrar based upon an Opinion of Counsel to the effect that any
Transfer to such Person may cause the Upper-Tier REMIC or Lower-Tier REMIC to
fail to qualify as a REMIC at any time that the Certificates are outstanding.
The terms "United States," "State" and "International Organization" shall have
the meanings set forth in Code Section 7701 or successor provisions.
"Distribution Account": The segregated account or accounts
created and maintained as a separate trust account or accounts by the Trustee
pursuant to Section 3.5(b), which shall be entitled " , as Trustee, in trust
for Holders of Prudential Securities Secured Financing Corporation Commercial
Mortgage Pass-Through Certificates, Series _________ Distribution Account" and
which shall be an Eligible Account.
"Distribution Date": The ___ day of any month, or if such
___ day is not a Business Day, the Business Day immediately following such ___
day, commencing on .
"Due Date": With respect to any Collection Period and any
Mortgage Loan, the date on which scheduled payments are due on such Mortgage
Loan (without regard to grace periods), such date being for all Mortgage Loans
other than Mortgage Loan No. - ______________________and _____________________
the_____________________Interest the ____ day of each month, and for Mortgage
Loan No._______________________the ____ day of the month, and for the
Interest, the remittance date under Prior Pooling and Servicing Agreement.
" _________ ": Credit Rating Co., or its successor in
interest.
"Early Termination Notice Date": Any date as of which the
aggregate Scheduled Principal Balance of the Mortgage Loans remaining in the
__________ Trust Fund is less than __% of the aggregate Scheduled Principal
Balance of the Mortgage Loans as of the Cut-off Date.
"EC Maturity Date": __________________________ .
"Eligible Account": Either (i) a segregated account or
accounts maintained with a federally or state-chartered depository institution
or trust company, the long term unsecured debt obligations of which (or of
such institution's parent holding company) are assigned a rating by each
Rating Agency that is greater than or equal to the rating then assigned to the
Class of Certificates outstanding at the time of any deposit therein which has
the highest rating then
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assigned of any such outstanding Class or (ii) a segregated trust account or
accounts maintained with a federally or state-chartered depository institution
or trust company acting in its fiduciary capacity, having, in either case, a
combined capital and surplus of at least $______ and subject to supervision or
examination by federal or state authority, or otherwise confirmed in writing
by each of the Rating Agencies that the maintenance of such account, which may
be an account maintained with the Trustee or the Servicer, shall not, in and
of itself, result in a downgrading, withdrawal or qualification of the rating
then assigned by such Rating Agency to any Class of Certificates. Eligible
Accounts may bear interest.
"Eligible Investor": (i) A Qualified Institutional Buyer
that is purchasing Privately Placed Certificates for its own account or for
the account of a Qualified Institutional Buyer to whom notice is given that
the offer, sale or transfer is being made in reliance on Rule 144A promulgated
under the 1933 Act or (ii) with respect to Privately Placed Certificates other
than the Class __ and Class __ Certificates, an Institutional Accredited
Investor.
"Environmental Report": With respect to each Mortgaged
Property, the environmental audit report or reports delivered to the Mortgage
Loan Seller in connection with the purchase of the related Mortgage Loan from
the Originator of such Mortgage Loan.
"ERISA": The Employee Retirement Income Security Act of
1974, as it may be amended from time to time.
"Escrow Account": As defined in Section 3.4(b).
"Escrow Payment": Any payment made by any Borrower to the
Servicer for the account of such Borrower for application toward the payment
of taxes, insurance premiums, assessments and similar items in respect of the
related Mortgaged Property and the payment of the Financial and Lease
Reporting Fee.
"Event of Default": As defined in Section 7.1.
"Extension Advisor": The Person who has the right to approve
the actions of the Special Servicer in granting extensions as set forth in
Section 3.26. shall serve as the initial Extension Advisor.
"Extension Advisory Fee": With respect to each Mortgage Loan
as to which an extension is requested after three successive extensions have
been granted in accordance with Section 3.10(a), _____% of the Scheduled
Principal Balance of such Mortgage Loan; provided that so long as the
____________ is the Extension Advisor the Extension Advisory Fee will be zero.
"FDIC": The Federal Deposit Insurance Corporation, or any
successor thereto.
"FHA": The Federal Housing Administration.
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"FHLMC": The Federal Home Loan Mortgage Corporation, or any
successor thereto.
"Final Recovery Determination": With respect to any REO
Mortgage Loan, Specially Serviced Mortgage Loan or Mortgage Loan subject to
repurchase by ________ or the Mortgage Loan Seller pursuant to Section 2.3(d)
or 2.3(e), the recovery of all Insurance Proceeds, Condemnation Proceeds,
Liquidation Proceeds, the related Repurchase Price and other payments or
recoveries (including proceeds of the final sale of any related REO Property)
which the Servicer, in its reasonable judgment as evidenced by a certificate
of a Servicing Officer delivered to the Trustee and the Custodian, expects to
be finally recoverable. The Servicer shall maintain records, prepared by a
Servicing Officer, of each Final Recovery Determination until the earlier of
(i) its termination as Servicer hereunder and the transfer of such records to
a successor servicer and (ii) five years following the termination of the
Trust Fund.
"Financial and Lease Reporting Fee": Any payment made by any
Borrower under the related Note as a deposit to ensure that such Borrower
furnishes to the mortgagee the required financial and leasing information on a
timely basis during the term of the related Mortgage Loan.
"Financial Market Publisher": Bloomberg Financial Service.
"Fiscal Agent":__________________, in its capacity as fiscal
agent of the Trustee, or its successor in interest, or any successor fiscal
agent appointed as herein provided.
" ": Investors Service, L.P., or its successor in
interest.
"FNMA": The Federal National Mortgage Association, or any
successor thereto.
"Hazardous Materials": Any dangerous, toxic or hazardous
pollutants, chemicals, wastes, or substances, including, without limitation,
those so identified pursuant to the Comprehensive Environmental Response,
Compensation and Liability Act, 42 U.S.C. Section 9601 et seq., or any other
environmental laws now existing, and specifically including, without
limitation, asbestos and asbestos-containing materials, polychlorinated
biphenyls, radon gas, petroleum and petroleum products, urea formaldehyde and
any substances classified as being "in inventory", "usable work in process" or
similar classification which would, if classified as unusable, be included in
the foregoing definition.
"Holder": With respect to any Certificate, a
Certificateholder; with respect to any Lower-Tier Regular Interest, the
Trustee.
"Indemnified Party": As defined in Section 8.5(c).
"Independent": When used with respect to any specified
Person, any other Person who (i) does not have any direct financial interest,
or any material indirect financial interest, in any of the Manager, the
Depositor, the Servicer, the Special Servicer, any Borrower or any Affiliate
thereof, and (ii) is not connected with any such specified Person as an
officer,
15
employee, promoter, underwriter, trustee, partner, director or Person performing
similar functions.
"Independent Contractor": Either (i) any Person that would
be an "independent contractor" with respect to the Trust Fund within the
meaning of Section 856(d)(3) of the Code if the Trust Fund were a real estate
investment trust (except that the ownership tests set forth in that section
shall be considered to be met by any Person that owns, directly or indirectly,
__% or more of any Class or __% or more of the aggregate value of all Classes
of Certificates), provided that the Trust Fund does not receive or derive any
income from such Person and the relationship between such Person and the Trust
Fund is at arm's length, all within the meaning of Treasury Regulations
Section 1.856-4(b)(5) (except that the Servicer shall not be considered to be
an Independent Contractor under the definition in this clause (i) unless an
Opinion of Counsel (obtained at the expense of the Servicer) addressed to the
Servicer and the Trustee has been delivered to the Trustee to the effect that
the Servicer meets the requirements of such definition) or (ii) any other
Person (including the Servicer) if the Servicer, on behalf of itself and the
Trustee, has received an Opinion of Counsel (obtained at the expense of the
party seeking to be deemed an Independent Contractor) to the effect that the
taking of any action in respect of any REO Property by such Person, subject to
any conditions therein specified, that is otherwise herein contemplated to be
taken by an Independent Contractor will not cause such REO Property to cease
to qualify as "foreclosure property" within the meaning of Section 860G(a)(8)
of the Code (determined without regard to the exception applicable for
purposes of Section 860D(a) of the Code) or cause any income realized with
respect of such REO Property to fail to qualify as Rents from Real Property
(provided that such income would otherwise so qualify).
"Individual Certificate": Any Certificate in definitive,
fully registered form without interest coupons.
"Institutional Accredited Investor": An entity meeting the
requirements of Rule 501(a)(1), (2), (3) or (7) of Regulation D promulgated
under the 1933 Act and which is not otherwise a Qualified Institutional Buyer.
"Insurance Proceeds": Proceeds of any fire and hazard
insurance policy, title policy or other insurance policy relating to a
Mortgage Loan and/or the Mortgaged Property securing any Mortgage Loan
(including any amounts paid by the Servicer or the Special Servicer pursuant
to Section 3.8), to the extent such proceeds are not to be applied to the
restoration of the related Mortgaged Property or released to the Borrower in
accordance with the express requirements of the related Mortgage or Note or
other documents including in the related Mortgage File or in accordance with
prudent and customary servicing practices.
"Interest Accrual Period": With respect to any Distribution
Date, the calendar month preceding the month in which such Distribution Date
occurs. Interest for each Interest Accrual Period shall be calculated based on
a ___-day year consisting of ______ __-day months.
"Interest Distribution Amount": With respect to any
Lower-Tier Regular Interest and any Distribution Date, interest for the
related Interest Accrual Period at the Lower-Tier
16
Pass-Through Rate for such Interest Accrual Period on the Certificate Balance
of such Lower-Tier Regular Interest, provided that, for such purpose, any
distributions in reduction of the Certificate Balance and reductions of the
Certificate Balance as a result of allocations of Realized Losses on the
Distribution Date occurring in such Interest Accrual Period shall be deemed to
have been made as of the _____ day of such Interest Accrual Period.
"Interest Shortfall": With respect to any Distribution Date
for any Lower-Tier Regular Interest, the excess, if any, of the Interest
Distribution Amount of such Lower-Tier Regular Interest on such Distribution
Date over the amount actually distributed to such Lower-Tier Regular Interest
in respect of its Interest Distribution Amount on such Distribution Date.
"Interested Person": As of any date of determination, the
Depositor, the Servicer, the Special Servicer, the Trustee, any Borrower, any
Manager of a Mortgaged Property, any Independent Contractor engaged by the
Special Servicer pursuant to Section 3.17, or any Person known to a
Responsible Officer of the Trustee to be an Affiliate of any of them.
"Investment Account": As defined in Section 3.7(a).
"Investment Representation Letter": As defined in Section
5.2(c)(i).
"IRS": The Internal Revenue Service.
"Liquidation Expenses": Expenses incurred by the Special
Servicer and the Trustee in connection with the liquidation of any Specially
Serviced Mortgage Loan or property acquired in respect thereof (including,
without limitation, legal fees and expenses, committee or referee fees, and,
if applicable, brokerage commissions, and conveyance taxes) and any Property
Protection Expenses incurred with respect to such Specially Serviced Mortgage
Loan or such property not previously reimbursed from collections or other
proceeds therefrom.
"Liquidation Proceeds": The amount (other than Insurance
Proceeds) received in connection with (i) the taking of a Mortgaged Property
by exercise of the power of eminent domain or condemnation, (ii) the
liquidation of a Specially Serviced Mortgage Loan through a trustee's sale,
foreclosure sale or otherwise, (iii) the sale of a Specially Serviced Mortgage
Loan or an REO Property in accordance with Section 3.18 or (iv) the sale of
all of the Mortgage Loans in accordance with Section 9.1.
"Loan Agreement": With respect to any Mortgage Loan, the
loan agreement, if any, between the Originator and the Borrower, pursuant to
which such Mortgage Loan was made.
"Loan Number": With respect to any Mortgage Loan, the loan
number by which such Mortgage Loan was identified on the books and records of
the Servicer or any subservicer for the Servicer, as set forth in the Mortgage
Loan Schedule.
17
"Loan-to-Value Ratio": With respect to any Mortgage Loan,
(a) the principal balance of such Mortgage Loan as of the Cut-off Date,
divided by (b) the Appraised Value of the related Mortgaged Property.
"Lower-Tier Pass-Through Rate": With respect to any
Distribution Date on or prior to the EC Maturity Date and any Class of
Lower-Tier Regular Interests other than the Class __________ Interests, a per
annum rate equal to the Weighted Average Net Mortgage Rate for the related
Interest Accrual Period, and with respect to the Class
________________________ ______________________ Interests, a per annum rate
equal to the higher of the Weighted Average Net Mortgage Rate for the related
Interest Accrual Period and __________ %. For each Distribution Date following
the EC Maturity Date and each of the Class _______________ and Interests, a
rate equal to the Pass-Through Rate of the Related Certificate. For each
Distribution Date following the EC Maturity Date and the Class ___________
Interests, a per annum rate equal to the higher of the Weighted Average Net
Mortgage Rate for the related Interest Accrual Period and for each
Distribution Date following the EC Maturity Date and the Class ____________
Interest, a per annum rate equal to the Weighted Average Net Mortgage Rate for
the related Interest Accrual Period.
"Lower-Tier Regular Interests": The Class __________
Interests.
"Lower-Tier REMIC": A segregated asset pool within the Trust
Fund consisting of the Mortgage Loans, collections thereon, any REO Property
acquired in respect thereof and amounts held from time to time in the
Collection Account.
"MAI": Member of the Appraisal Institute.
"Management Agreement": With respect to any Mortgage Loan,
the Management Agreement, if any, by and between the Manager and the related
Borrower, or any successor Management Agreement between such parties.
"Manager": With respect to any Mortgage Loan, any property
manager for the related Mortgaged Property.
"Maturity Date": With respect to each Mortgage Loan, the
maturity date as set forth in the Mortgage Loan Schedule.
" __________________ ": ________________ , together with its
successor and assigns.
"Monthly Payment": With respect to any Mortgage Loan (other
than any REO Mortgage Loan) and any Due Date, the scheduled monthly payment of
principal and interest, excluding any Balloon Payment, on such Mortgage Loan
which is payable by the related Borrower on such Due Date under the related
Note (after giving effect to any extension or modification permitted
hereunder). With respect to any REO Mortgage Loan, the monthly payment which
would otherwise have been payable on such Due Date had the related Note not
been discharged (after giving effect to any extension or other modification),
determined as set
18
forth in the preceding sentence and on the assumption that all other amounts,
if any, due thereunder are paid when due.
"Mortgage": The mortgage, deed of trust or other instrument
creating a first lien on or first priority ownership interest in a Mortgaged
Property securing the related Note.
"Mortgage File": With respect to any Mortgage Loan, the
mortgage documents required to be maintained in either the Trustee Mortgage
File or the Servicer Mortgage File.
"Mortgage Loan": Each of (i) the mortgage loans transferred
and assigned to the Trustee pursuant to Section 2.1 and from time to time held
in the Trust Fund, such mortgage loans originally so transferred, assigned and
held being identified on the Mortgage Loan Schedule as of the Cut-off Date and
(ii) the __________ Interest. Such term shall include any REO Mortgage Loan.
"Mortgage Loan Documents": Any and all documents contained
in the Trustee Mortgage File and the Servicer Mortgage File.
"Mortgage Loan Purchase and Sale Agreement": The Mortgage
Loan Purchase and Sale Agreement, dated as of the Cut-off Date, by and among
the Depositor, the Mortgage Loan Seller and ___________, substantially in the
form attached hereto as Exhibit G.
"Mortgage Loan Schedule": As of any date, the list of
Mortgage Loans included in the Trust Fund on such date, such list as of the
Closing Date being attached hereto as Exhibit B, which list shall set forth
the following information with respect to each Mortgage Loan:
(a) the Loan Number;
(b) the property name of the related Mortgaged Property
and the city and state where such Mortgaged
Property is located;
(c) the Monthly Payment in effect as of the Cut-off Date;
(d) the Mortgage Rate and the Default Rate;
(e) the Maturity Date;
(f) the period over which scheduled principal payments
on such Mortgage Loan would amortize the principal
balance thereof;
(g) the Debt Service Coverage Ratio and Loan to Value
Ratio.
(h) the Scheduled Principal Balance as of the Cut-off
Date and, as applicable, the allocation of such
balance to each related Mortgaged Property;
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(i) if applicable, the name of the Manager for the
related Mortgaged Property;
(j) whether such Mortgage Loan permits Non-Premium
Prepayments;
(k) a description of the Prepayment Premium payable
with respect to such Mortgage Loan;
(l) the Loan Number of any Mortgage Loan with which
such Mortgage Loan is cross-collateralized or
cross-defaulted;
(m) whether such Mortgage Loan is secured by a fee
simple interest or a leasehold interest in the
related Mortgaged Property or both;
(n) the property type of the Mortgaged Property
securing such Mortgage Loan; and
(o) the originator of such Mortgage Loan.
The Mortgage Loan Schedule shall also set forth the total of the amounts
described under clause (c) and (g) above for all of the Mortgage Loans. The
Mortgage Loan Schedule may be in the form of more than one list, collectively
setting forth all of the information required.
"Mortgage Loan Seller": ____________________ , a _________
corporation, and its successors in interest.
"Mortgage Rate": With respect to each Mortgage Loan, the
annual rate at which interest accrues on such Mortgage Loan (in the absence of
a default), as set forth in the Mortgage Loan Schedule.
"Mortgaged Property": The underlying property securing a
Mortgage Loan (other than the _________ Interest), including any REO Property,
consisting of a fee simple or leasehold estate in a parcel of land improved by
a commercial property, together with any personal property, fixtures, leases
and other property or rights pertaining thereto.
"Net Liquidation Proceeds": The excess of Liquidation
Proceeds received with respect to any Mortgage Loan over the amount of
Liquidation Expenses incurred with respect thereto.
"Net Mortgage Rate": With respect to any Mortgage Loan, the
Mortgage Rate for such Mortgage Loan minus the Servicing Fee Rate.
"Net REO Proceeds": With respect to each REO Property, REO
Proceeds with respect to such REO Property net of any insurance premiums,
taxes, assessments and other costs and expenses permitted to be paid therefrom
pursuant to Section 3.17(b).
20
"New Lease": Any lease of REO Property entered into on
behalf of the Trust Fund, including any lease renewed or extended on behalf of
the Trust Fund if the Trust Fund has the right to renegotiate the terms of
such lease.
"1933 Act ": The Securities Act of 1933, as it may be
amended from time to time.
"1934 Act": The Securities Exchange Act of 1934, as it may
be amended from time to time.
"Non-Premium Prepayment": Any Principal Prepayment received
that is not required to be accompanied by a Prepayment Premium.
"Nonrecoverable Advance ": Any portion of an Advance
proposed to be made or previously made which has not been previously
reimbursed to the Servicer, the Trustee or the Fiscal Agent, as applicable,
and which the Servicer, the Trustee or the Fiscal Agent has determined, based
on an internal or external appraisal conducted in accordance with MAI
standards and methodologies (which appraisal shall have been conducted within
the ___ months preceding any such determination) or, in the event that a Phase
I or Phase II environmental report has been conducted which leads the Servicer
to determine that foreclosing upon or otherwise obtaining title to the related
Mortgaged Property would be prohibited in accordance with the provisions of
Section 3.10(f), based on such environmental report, will not or, in the case
of a proposed Advance, would not, be ultimately recoverable by the Servicer,
the Trustee or the Fiscal Agent, as applicable, from late payments, Insurance
Proceeds, Condemnation Proceeds, Liquidation Proceeds and other collections on
or in respect of the related Mortgage Loan. To the extent that any Borrower is
not obligated under the related Mortgage Loan Documents to pay or reimburse
any portion of any Advances that are outstanding with respect to the related
Mortgage Loan as a result of a modification of such Mortgage Loan by the
Special Servicer which forgives unpaid Monthly Payments or other amounts which
the Servicer had previously advanced, and the Servicer determines that no
other source of payment or reimbursement for such advances is available to it,
such Advances shall be deemed to be nonrecoverable; provided, however, that in
connection with the foregoing the Servicer shall provide an Officer's
Certificate as described below. The determination by the Servicer, the Trustee
or the Fiscal Agent, as applicable, that it has made a Nonrecoverable Advance
or that any proposed Advance, if made, would constitute a Nonrecoverable
Advance shall be evidenced by a certificate of a Servicing Officer,
Responsible Officer or Vice President or equivalent or senior officer of the
Fiscal Agent, as appropriate, delivered to the Trustee, the Special Servicer
and the Depositor setting forth such determination and the procedures and
considerations of the Servicer, the Trustee or Fiscal Agent, as applicable,
forming the basis of such determination (including a copy of the appraisal or
environmental report which was the basis for such determination).
Notwithstanding the above, the Trustee and the Fiscal Agent shall be entitled
to rely upon any determination by the Servicer that any Advance previously
made is a Nonrecoverable Advance or that any proposed Advance, if made, would
constitute a Nonrecoverable Advance.
21
"Non-U.S. Person": A person that is not a citizen or
resident of the United States; a corporation, partnership, or other entity
created or organized in or under the laws of the United States or any
political subdivision thereof; or an estate or trust whose income is subject
to United States federal income tax regardless of its source.
"Note": With respect to any Mortgage Loan (other than the
___________ Certificate) as of any date of determination, the note or other
evidence of indebtedness and/or agreements evidencing the indebtedness of the
related Borrower or obligor under such Mortgage Loan, and in the case of the
_______________ Interest, to the extent applicable, the ____________
Certificate, in each case, including any amendments or modifications, or any
renewal or substitution notes, as of such date.
"Notice of Termination": Any of (i) the notices given to the
Trustee by the Servicer or any Holder of a Class __ Certificate pursuant to
Section 9.1(c) and (ii) the notice given by the Trustee to each Holder
pursuant to Section 9.1(d)(iv).
"Officer's Certificate": A certificate signed by the
Chairman of the Board, the Vice Chairman of the Board, the President, a Vice
President (however denominated), the Treasurer, the Secretary, one of the
Assistant Treasurers or Assistant Secretaries or any other officer of the
general partner of the Servicer, Special Servicer or the Auction Agent
customarily performing functions similar to those performed by any of the
above designated officers and also with respect to a particular matter, any
other officer to whom such matter is referred because of such officer's
knowledge of and familiarity with the particular subject, or an authorized
officer of the Depositor, and delivered to the Depositor, the Trustee, the
Special Servicer or the Servicer, as the case may be.
"Opinion of Counsel": A written opinion of counsel, who may,
without limitation, be counsel for the Depositor, the Special Servicer or the
Servicer, as the case may be, acceptable to the Trustee, except that any
opinion of counsel relating to (a) qualification of the Upper-Tier REMIC or
Lower-Tier REMIC as a REMIC or the imposition of tax under the REMIC
Provisions on any income or property of either REMIC, (b) compliance with the
REMIC Provisions (including application of the definition of "Independent
Contractor") or (c) a resignation of the Servicer or the Special Servicer
pursuant to Section 6.4, must be an opinion of counsel who is Independent of
the Depositor, the Special Servicer and the Servicer.
"Originator": With respect to a Mortgage Loan, the
originator of such Mortgage Loan, as identified in the Mortgage Loan Schedule.
"Ownership Interest": As to any Certificate, any ownership
or security interest in such Certificate as the Holder thereof and any other
interest therein, whether direct or indirect, legal or beneficial, as owner or
as pledgee.
"P&I Advance": As to any Mortgage Loan, any advance made by
the Servicer, the Trustee, or the Fiscal Agent pursuant to Section
4.6(b)(iii).
22
"P&I Certificates": The Class ___, Class ___, Class __,
Class ___, Class ___, Class ___, Class ___, Class ___ and Class ___
Certificates.
"Pass-Through Rate": Any one of the Class ___, Class ___,
Class ____, Class _, Class _, Class _, Class _, Class _, Class _, Class _ or
Class ___ Pass-Through Rates.
"Paying Agent": The paying agent appointed pursuant to
Section 5.5.
"Percentage Interest": As to any Certificate, the percentage
interest evidenced thereby in distributions required to be made with respect
to the related Class. With respect to any Certificate (except the Class __ and
Class ___ Certificates), the percentage interest is derived by dividing the
denomination of such Certificate by the initial Certificate Balance or
notional amount of such Class of Certificates. With respect to any Class ___
or Class ___ Certificate, the percentage interest is set forth on the face
thereof.
"Permitted Investments": Any one or more of the following
obligations or securities payable on demand or having a scheduled maturity on
or before the Business Day preceding the date on which such funds are required
to be drawn, regardless of whether issued by the Depositor, the Servicer, the
Special Servicer, the Trustee or any of their respective Affiliates, and
having at all times the required ratings, if any, provided for in this
definition (provided that no Permitted Investment, if downgraded, shall be
required to be sold at a loss), unless each Rating Agency shall have confirmed
in writing to the Servicer or the Special Servicer, as applicable, that a
lower rating will not result in the withdrawal, downgrading or qualification
of the ratings then assigned to the Certificates:
(i) direct obligations of, or obligations guaranteed as to full
and timely payment of principal and interest by, the United
States or any agency or instrumentality thereof, provided
that such obligations are backed by the full faith and
credit of the United States of America, including, without
limitation, U.S. Treasury Obligations, Farmers Home
Administration certificates of beneficial interest, General
Services Administration participation certificates and Small
Business Administration guaranteed participation
certificates or guaranteed pool certificates;
(ii) Federal Housing Administration debentures;
(iii) direct obligations of, or guaranteed as to timely payment of
principal and interest by, FHLMC (debt obligations only),
FNMA (debt obligations only), the Federal Farm Credit System
(consolidated systemwide bonds and notes only), the Federal
Home Loan Banks (consolidated debt obligations only), the
Student Loan Marketing Association, the Financing Corp.
(consolidated debt obligations only), and the Resolution
Funding Corp.;
(iv) Federal funds time deposits in, or uncertificated
certificates of deposit of, or bankers' acceptances, or
repurchase obligations, all having maturities of not more
than ___ days issued by, any bank or trust company, savings
and loan association or savings bank, depository institution
or trust company having a short term debt
23
obligation rating from S&P of "A-1+" and that is in the
highest short-term rating category of each Rating Agency
unless each of the Rating Agencies has confirmed in writing
that a lower rating shall not result, in and of itself, in a
downgrading, withdrawal or qualification of the rating then
assigned by such Rating Agency to any Class of the
Certificates;
(v) commercial paper having a maturity of ___ days or less
(including (A) 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 and (B) demand notes that
constitute vehicles for investment in commercial paper) that
is rated by each Rating Agency in its highest short-term
unsecured rating category;
(vi) units of taxable money market funds rated "AAAm" or "AAAg"
by S&P or mutual funds, which funds seek to maintain a
constant asset value and have been rated by each Rating
Agency in its highest rating category or which have been
designated in writing by each Rating Agency as Permitted
Investments with respect to this definition;
(vii) any other demand, money market or time deposit, demand
obligation or any other obligation, security or investment, as may be
acceptable to each Rating Agency as a permitted investment of funds
backing securities having ratings equivalent to its initial rating of
the Class ___, Class ___ and Class ___ Certificates if each of the
Rating Agencies has previously confirmed in writing that the holding
of such demand, money market or time deposit, demand obligation or
any other obligation, security or investment shall not result, in and
of itself, in a downgrading, withdrawal or qualification of the
rating then assigned by such Rating Agency to any Class of
Certificates; and
(viii) such other obligations confirmed in writing by each of the
Rating Agencies that such obligations are acceptable as Permitted
Investments and the holding of such obligations by the Servicer or
the Special Servicer, as applicable, shall not result, in and of
itself, in a downgrading, withdrawal or qualification of the rating
then assigned by such Rating Agency to any Class of Certificates;
provided, however, that (a) none of such obligations or
securities listed above shall have an "r" highlighter affixed to its rating if
rated by S&P; (b) each such obligation or security shall have a fixed dollar
amount of principal due at maturity which cannot vary or change; (c) if any
such obligation or security provides for a variable rate of interest, interest
shall be tied to a single interest rate index plus a single fixed spread (if
any) and move proportionately with that index; and (d) if any of the
obligations or securities listed in paragraphs (iii) - (ix) above are not
rated by _____________ , such investment shall be rated by ___________, as
appropriate, and if such obligations or securities are not rated by , such
investment shall be rated by S&P and one other nationally recognized
statistical rating organization; and provided, further, however, that such
instrument continues to qualify as a "cash flow investment" pursuant to Code
Section 860G(a)(6) earning a passive return in the nature of interest and that
no instrument
24
or security shall be a Permitted Investment if (i) such instrument or security
evidences a right to receive only interest payments or (ii) the right to
receive principal and interest payments derived from the underlying investment
provides a yield to maturity in excess of ___% of the yield to maturity at par
of such underlying investment.
"Permitted Transferee": With respect to a Class __ or Class
__ Certificate, any Person or agent thereof that is a Qualified Institutional
Buyer other than (a) a Disqualified Organization, (b) any other Person
designated by the Certificate Registrar based upon an Opinion of Counsel
(provided at the expense of such Person or the Person requesting the Transfer)
to the effect that the Transfer of an Ownership Interest in any Class __ or
Class __ Certificate to such Person may cause the Upper-Tier REMIC or Lower-
Tier REMIC to fail to qualify as a REMIC at any time that the Certificates are
outstanding, or (c) a Person that is a Disqualified Non-U.S. Person.
"Person": Any individual, corporation, limited liability
company, partnership, joint venture, association, joint-stock company, trust,
estate, unincorporated organization or government or any agency or political
subdivision thereof.
"Placement Agent": Prudential Securities Incorporated.
"Plan": As defined in Section 5.2(i).
"Pooled Available Funds": For each Distribution Date, the
sum of all previously undistributed Monthly Payments or other receipts on
account of principal and interest (including Unscheduled Payments and any Net
REO Proceeds transferred from an REO Account to the Collection Account
pursuant to Section 3.17(b)) on or in respect of the Mortgage Loans received
by the Servicer in the Collection Period relating to such Distribution Date,
plus all other amounts received by the Servicer during such Collection Period
and required to be placed in the Collection Account by the Servicer pursuant
to Section 3.5(a) allocable to such Mortgage Loans, and including all P&I
Advances made by the Servicer, the Trustee or the Fiscal Agent in respect of
such Distribution Date and deposits made by the Servicer pursuant to Section
3.25 with respect to such Distribution Date, but excluding the following:
(a) amounts permitted to be used to reimburse the
Servicer, the Trustee or the Fiscal Agent for
previously unreimbursed Advances and interest
thereon as described in Section 3.6(ii) and (iii);
(b) those portions of each payment of interest which
represent the applicable Servicing Compensation;
(c) all amounts in the nature of late fees, late
charges and similar fees, loan modification fees,
extension fees, loan service transaction fees,
demand fees, beneficiary statement charges,
Assumption Fees and similar fees;
25
(d) all amounts representing scheduled Monthly Payments
due after the Due Date in the related Collection
Period (such amounts to be treated as received on
the Due Date when due);
(e) that portion of Liquidation Proceeds, Condemnation
Proceeds or Insurance Proceeds with respect to a
Mortgage Loan which represents any unpaid Servicing
Compensation to which the Servicer is entitled;
(f) all amounts representing certain expenses
reimbursable to the Servicer, the Special Servicer,
the Trustee or the Fiscal Agent and other amounts
permitted to be retained by the Servicer or the
Special Servicer or withdrawn by the Servicer from
the Collection Account (including, without
limitation, as provided in Section 3.6) pursuant to
the terms hereof;
(g) with respect to Distribution Dates after the EC
Maturity Date, Prepayment Premiums received in the
related Collection Period;
(h) any interest or investment income on funds on
deposit in the Collection Account or in Permitted
Investments in which such fund may be invested.
"Pooled Principal Distribution Amount": For any Distribution
Date, an amount equal to the sum of:
(i) the principal component of all scheduled Monthly
Payments (other than Balloon Payments) which become
due (regardless of whether received) on the
Mortgage Loans during the related Collection
Period;
(ii) to the extent not included elsewhere in this
definition, the principal component of all Assumed
Scheduled Payments, as applicable, deemed to become
due (regardless of whether received) during the
related Collection Period with respect to any
Mortgage Loan that is delinquent in respect of its
Balloon Payment;
(iii) to the extent not included elsewhere in this
definition, the Scheduled Principal Balance of each
Mortgage Loan that was repurchased from the Trust
Fund in connection with the breach of a
representation or warranty or purchased from the
Trust Fund pursuant to Section 9.1, in either case,
during the related Collection Period;
(iv) to the extent not included elsewhere in this
definition, the portion of Unscheduled Payments
allocable to principal of any Mortgage Loan that
was liquidated during the related Collection
Period;
26
(v) to the extent not included elsewhere in this
definition, the principal component of all Balloon
Payments received during the related Collection
Period;
(vi) to the extent not included elsewhere in this
definition, all other Principal Prepayments
received in the related Collection Period; and
(vii) to the extent not included elsewhere in this
definition, any other full or partial recoveries in
respect of principal, including Insurance Proceeds,
Condemnation Proceeds, Liquidation Proceeds and Net
REO Proceeds.
"Prepayment Assumption": The assumption identified as
"Scenario 3" in Exhibit A to the Private Placement Memorandum dated _________
,relating to the Privately Placed Certificates and identified as "Scenario 3"
in the Prospectus Supplement, dated _________ , relating to the Publicly
Offered Certificates.
"Prepayment Interest Shortfall": With respect to any
Distribution Date and any Mortgage Loan as to which a Principal Prepayment was
made by the related Borrower during the related Collection Period, the amount
by which (i) __ full days of interest at the related Net Mortgage Rate on the
Scheduled Principal Balance of such Mortgage Loan in respect of which interest
would have been due in the absence of such Principal Prepayment on the Due
Date next succeeding the date of such Principal Prepayment exceeds (ii) the
amount of interest received from the related Borrower in respect of such
Principal Prepayment.
"Prepayment Interest Surplus": With respect to any
Distribution Date and any Mortgage Loan as to which a Principal Prepayment was
made by the related Borrower during the related Collection Period, the amount
by which (i) the amount of interest received from the related Borrower in
respect of such Principal Prepayment exceeds (ii) __ full days of interest at
the related Net Mortgage Rate on the Scheduled Principal Balance of such
Mortgage Loan in respect of which interest would have been due in the absence
of such Principal Prepayment on the Due Date next succeeding the date of such
Principal Prepayment.
"Prepayment Premium": Payments received on a Mortgage Loan
as the result of a Principal Prepayment thereon, not otherwise due thereon in
respect of principal or interest, which are intended to be a disincentive to
prepayment.
"Principal Prepayment": With respect to any Mortgage Loan,
any payment of principal made by the related Borrower which is received in
advance of its scheduled Due Date and which is not accompanied by an amount of
interest representing the full amount of scheduled interest due on any date or
dates in any month or months subsequent to the month of prepayment.
"Prior Pooling and Servicing Agreement": The Amended and
Restated Pooling and Servicing Agreement, dated as of _____________________ ,
by and among Prudential Securities Secured Financing Corporation, as
depositor, _________________ as servicer, ___ as special servicer, ________ ,
as trustee and _______, as fiscal agent, with respect to the
27
Prudential Securities Secured Financing Corporation, Commercial Mortgage
Pass-Through Certificates, Series _____________.
"Privately Placed Certificates": The Class ___ Certificates,
the Class ____ Certificates, the Class __ Certificates, the Class __
Certificates, the Class __ Certificates, the Class __ Certificates, the Class
___ Certificates, the Class ___ Certificates, the Class __ Certificates and
the Class ___ Certificates.
"Property Advance": As to any Mortgage Loan, any advance
made by the Servicer, the Trustee or the Fiscal Agent in respect of Property
Protection Expenses or any expenses incurred to protect and preserve the
security for such Mortgage Loan or taxes and assessments or insurance
premiums, pursuant to Section 3.4, 3.8 or Section 3.22, as applicable.
"Property Protection Expenses": Any costs and expenses
incurred pursuant to Sections 3.10(c), 3.10(g), 3.10(j), 3.17(b), 3.17(c),
3.18(a) and 3.18(b).
"Publicly Offered Certificates": The Class ___ Certificates,
the Class __ Certificates, the Class __ Certificates and the Class __
Certificates.
"Qualified Institutional Buyer": A qualified institutional
buyer within the meaning of Rule 144A.
"Qualified Insurer": An insurance company or security or
bonding company qualified to write the related insurance policy in the
relevant jurisdiction, which (i) except as provided in clauses (ii) or (iii)
below, shall have a claims paying ability of "AA" or better by each Rating
Agency (or, if such company is not rated by ___________ , and if such company
is not rated by either __________ , by _______ and one other nationally
recognized statistical rating organization), (ii) in the case of public
liability insurance policies required to be maintained with respect to REO
Properties in accordance with Section 3.8(a), shall have a claims paying
ability of "A" or better by each Rating Agency (or, if such company is not
rated by _____________ , by S&P and one other nationally recognized
statistical rating organization) or (iii) in the case of the fidelity bond and
errors and omissions insurance required to be maintained pursuant to Section
3.8(c), shall have a claims paying ability rated by each Rating Agency (or if
such company is not rated by , and if such company is not rated by either
____________, by S&P and one other nationally recognized statistical rating
organization) no lower than two ratings categories lower than the highest
rating of any outstanding Class of Certificates from time to time, but in no
event lower than "BBB", unless in any such case each of the Rating Agencies
has confirmed in writing that an insurance company with a lower claims paying
ability shall not result, in and of itself, in a downgrading, withdrawal or
qualification of the rating then assigned by such Rating Agency to any Class
of Certificates.
"Qualified Mortgage": A Mortgage Loan that is a "qualified
mortgage" within the meaning of Section 860G(a)(3) of the Code (but without
regard to the rule in Treasury Regulations 1.860G-2(f)(2) that treats a
defective obligation as a qualified mortgage), or any substantially similar
successor provision.
28
"Qualified Offeror": A prospective purchaser of the Mortgage
Loans in an auction pursuant to Section 9.1(d) whom the Auction Agent has
reasonably determined possesses the financial ability and is otherwise
qualified to purchase all of the Mortgage Loans.
"Rating Agency": Each of . References
herein to the highest long-term unsecured debt rating category of each Rating
Agency shall mean "AAA."
"Real Property": Land or improvements thereon such as
buildings or other inherently permanent structures (including items that are
structural components of such buildings or structures), in each such case as
such terms are used in the REMIC Provisions.
"Realized Loss": With respect to any Distribution Date, the
amount, if any, by which the aggregate of the Certificate Balances of the
Lower-Tier Regular Interests, after giving effect to distributions made on
such Distribution Date, exceeds the aggregate of the
Scheduled Principal Balances of the Mortgage Loans as of the Due Date in the
month in which such Distribution Date occurs.
"Record Date": With respect to each Distribution Date, the
_____ business day of the month preceding the month in which such Distribution
Date occurs.
"Regular Certificates": The Class ___, Class ___, Class
____, Class __, Class __, Class __, Class __, Class __, Class __, Class __,
Class ___ and Class ___ Certificates.
"Regular Servicing Period": Any Interest Accrual Period
other than a Special Servicing Period.
"Regulation D": Regulation D under the Act.
"Related Certificates" and "Related Lower-Tier Regular
Interest": For any Lower-Tier Regular Interest, the related Certificates set
forth below and for any Certificates, the related Lower-Tier Regular Interest
set forth below:
Related Lower-Tier
Related Certificates Regular Interest
-------------------- ----------------
Class Class
Class Class
Class N/A
Class Class
Class Class
Class Class
Class Class
Class Class
Class Class
Class Class
Class Class
Class N/A
29
"REMIC": A "real estate mortgage investment conduit" within
the meaning of Section 860D of the Code.
"REMIC Provisions": Provisions of the federal income tax law
relating to real estate mortgage investment conduits, which appear at Section
860A through 860G of Subchapter M of Chapter 1 of the Code, and related
provisions, and regulations (including any applicable proposed regulations)
and rulings promulgated thereunder, as the foregoing may be in effect from
time to time.
"Remittance Date": The Business Day preceding each
Distribution Date.
"Rents from Real Property": With respect to any REO
Property, gross income of the character described in Section 856(d) of the
Code, which income, subject to the terms and conditions of that Section of the
Code in its present form, does not include:
(i) except as provided in Section 856(d)(4) or (6) of
the Code, any amount received or accrued, directly
or indirectly, with respect to such REO Property,
if the determination of such amount depends in
whole or in part on the income of profits derived
by any Person from such property (unless such
amount is a fixed percentage or percentages of
receipts or sales and otherwise constitutes Rents
from Real Property);
(ii) any amount received or accrued, directly or
indirectly, from any Person if the Trust Fund owns
directly or indirectly (including by attribution) a
ten percent or greater interest in such Person
determined in accordance with Sections 856(d)(2)(B)
and (d)(5) of the Code;
(iii) any amount received or accrued, directly or
indirectly, with respect to such REO Property if
any Person Directly Operates such REO Property;
(iv) any amount charged for services that are not
customarily furnished in connection with the rental
of property to tenants in buildings of a similar
class in the same geographic market as such REO
Property within the meaning of Treasury Regulations
Section 1.856-4(b)(1) (whether or not such charges
are separately stated); and
(v) rent attributable to personal property unless such
personal property is leased under, or in connection
with, the lease of such REO Property and, for any
taxable year of the Trust Fund, such rent is no
greater than 15 percent of the total rent received
or accrued under, or in connection with, the lease.
"REO Account": As defined in Section 3.17(b).
"REO Mortgage Loan": Any Mortgage Loan (other than the
_____________ Interest) as to which the related Mortgaged Property has become
an REO Property.
30
"REO Proceeds": With respect to any REO Property and the
related REO Mortgage Loan, all revenues received by the Servicer with respect
to such REO Property or REO Mortgage Loan that do not constitute Liquidation
Proceeds.
"REO Property": A Mortgaged Property title to which has been
acquired by the Servicer on behalf of the Trust Fund through foreclosure, deed
in lieu of foreclosure or otherwise.
"Repurchase Price": With respect to any Mortgage Loan to be
repurchased pursuant to Section 2.3(d) or 2.3(e) or any Specially Serviced
Mortgage Loan or any REO Property to be sold or repurchased pursuant to
Section 3.18, an amount, calculated by the Servicer, equal to:
(i) the unpaid principal balance of such Mortgage Loan,
Specially Serviced Mortgage Loan or REO Mortgage
Loan related to any REO Property as of the Due Date
as to which a payment was last made by the related
Borrower or was advanced by the Servicer; plus
(ii) unpaid accrued interest from the Due Date as to
which interest was last paid by such Borrower or
was advanced by the Servicer up to the Due Date in
the month following the month in which the purchase
or repurchase occurred at a rate equal to the
related Mortgage Rate on the unpaid principal
balance of such Mortgage Loan, Specially Serviced
Mortgage Loan or REO Mortgage Loan related to any
REO Property; plus
(iii) any unreimbursed Advances, together with
interest thereon at the Advance Rate, and
unpaid Servicing Compensation allocable to
such Mortgage Loan; and plus
(iv) in the event that such Mortgage Loan is required to
be repurchased pursuant to Section 2.3(d) or
2.3(e), expenses reasonably incurred or to be
incurred by the Servicer or the Trustee in respect
of the breach or defect giving rise to the
repurchase obligation, including any expenses
arising out of the enforcement of the repurchase
obligation.
"Request for Release": A request for release signed by a
Servicing Officer, substantially in the form of Exhibit __ hereto.
"Reserve Accounts": With respect to any Mortgage Loan,
reserve or escrow accounts, if any, established pursuant to the related
Mortgage Loan Documents and any Escrow Account. Each Reserve Account shall be
an Eligible Account, except with respect to Mortgage Loans No. ▇▇-▇▇▇▇▇▇▇ and
▇▇-▇▇▇▇▇▇▇. Any Reserve Account shall be beneficially owned for federal income
tax purposes by the Person who is entitled to receive the reinvestment income
or gain thereon in accordance with the related Mortgage Loan Documents and
Section 3.7.
31
"Responsible Officer": Any officer or any employee with
responsibilities similar to those of an officer of the Asset-Backed Trust
Services Department of the Trustee (and, in the event that the Trustee is the
Certificate Registrar or the Paying Agent, of the Certificate Registrar or the
Paying Agent, as applicable) assigned to the Corporate Trust Office with
direct responsibility for the administration of this Agreement and also, with
respect to a particular matter, any other officer or any employee with
responsibilities similar to those of an officer of the Asset-Backed Trust
Services Department of the Trustee to whom such matter is referred because of
such officer's or employee's knowledge of and familiarity with the particular
subject, and, in the case of any certification required to be signed by a
Responsible Officer, such an officer or employee whose name and specimen
signature appears on a list of corporate trust officers and employees
furnished to the Servicer by the Trustee, as such list may from time to time
be amended.
"Rule 144A": Rule 144A, under the 1933 Act.
" ": __________________ Rating Services, or its successor in
interest.
"Scheduled Final Distribution Date": ____________________
"Scheduled Principal Balance": With respect to any Mortgage
Loan, as of any Due Date, the principal balance of such Mortgage Loan as of
such Due Date, after giving effect to (a) any Principal Prepayments,
Non-Premium Prepayments or other unscheduled recoveries of principal and any
Balloon Payments received during the related Collection Period, and (b) any
payment in respect of principal, if any, due on or before such Due Date (other
than a Balloon Payment, but including the principal portion of any Assumed
Scheduled Payment, if applicable), irrespective of any delinquency in payment
by the Borrower. The Scheduled Principal Balance of any REO Mortgage Loan as
of any Due Date is equal to the principal balance thereof outstanding on the
date that the related Mortgaged Property became an REO Property minus any Net
REO Proceeds allocated to principal on such REO Mortgage Loan and reduced by
Monthly Payments due thereon on or before such Due Date. With respect to any
Mortgage Loan, from and after the date on which the Servicer makes a Final
Recovery Determination, the Scheduled Principal Balance thereof shall be zero.
" ________________ ": A mortgage loan originated by
___________________ and identified in the ___________________ Agreement.
" __________________ Agreement": The Participation Agreement,
dated as of ___________________ , by and between ____________________ (in its
capacity as trustee under the Prior Pooling and Servicing Agreement), as seller,
and the Mortgage Loan Seller, as participant, substantially in the form
attached hereto as Exhibit I.
" __________________ Certificate": The certificate issued by
the trustee under the Prior Pooling and Servicing Agreement in the name of the
Trustee, evidencing the _________ Interest.
32
" ___________________ Interest ": The ___% participation
interest in the __________ Loan evidenced by the ___________________
Certificate.
"Securities Depository": The Depository Trust Company, or
any successor Securities Depository hereafter named. The nominee of the
initial Securities Depository, for purposes of registering those Certificates
that are to be Book-Entry Certificates, is Cede & Co. The Securities
Depository shall at all times be a "clearing corporation" as defined in
Section 8-102(3) of the Uniform Commercial Code of the State of New York and a
"clearing agency" registered pursuant to the provisions of Section 17A of the
Securities Exchange Act of 1934, as amended.
"Securities Depository Participant": A broker, dealer, bank
or other financial institution or other Person for whom from time to time the
Securities Depository effects book-entry transfers and pledges of securities
deposited with the Securities Depository.
"Securities Legend": With respect to each Residual
Certificate and any Individual Certificate (other than a Residual Certificate)
that is a Privately Placed Certificate the legend set forth in, and
substantially in the form of, Exhibit __ hereto.
"Senior Principal Distribution Cross-Over Date": The first
Distribution Date as of which the aggregate Certificate Balance of the Class
___ Certificates and of the Class ___ Certificates outstanding immediately
prior thereto exceeds the sum of (a) the aggregate Scheduled Principal Balance
of the Mortgage Loans that will be outstanding immediately following such
Distribution Date and (b) the portion of the Available Distribution Amount for
such Distribution Date that will remain after the distribution of interest has
been made on the Class ___ and Class ___ Certificates on such Distribution
Date.
"Seriously Delinquent Loan": With respect to any Remittance
Date, any Mortgage Loan that (i) is __ days or more delinquent (without regard
to any grace period) or (ii) was __ days or more delinquent (without regard to
any grace period) and as to which the related Borrower has not made, since the
most recent date on which such Mortgage Loan was so delinquent, __ consecutive
Monthly Payments.
"Servicer ": ________________, a _______________, or its
successor in interest, or any successor Servicer appointed as herein provided.
"Servicer Mortgage File": With respect to any Mortgage Loan,
all Mortgage Loan Documents related to such Mortgage Loan that are not
required to be delivered to the Custodian pursuant to Section 2.1 or to be
maintained as part of the Trustee Mortgage File, including without limitation:
(i) a copy of the Management Agreement, if any, for the
related Mortgaged Property;
(ii) a copy of the related ground lease, as amended, if
any, for such Mortgaged Property;
33
(iii) any and all amendments, modifications and
supplements to, and waivers related to, any of the
foregoing;
(iv) copies of the related appraisals, surveys,
environmental reports and other similar documents;
and
(v) any other written agreements related to such
Mortgage Loan.
"Servicer Remittance Report": A report prepared by the
Servicer in such media as may be agreed upon by the Servicer and the Trustee
containing such information regarding the Mortgage Loans as will permit the
Trustee to calculate the amounts to be distributed pursuant to Section 4.1 and
to furnish statements to Certificateholders pursuant to Section 4.2 and
containing such additional information as the Servicer and the Trustee may
from time to time agree.
"Servicing Compensation": With respect to each Mortgage
Loan, the Servicing Fee and the Special Servicing Fee which shall be due to
the Servicer and the Special Servicer, as applicable, and such other
compensation of the Servicer and Special Servicer specified in Section 3.12,
as adjusted pursuant to Section 3.25.
"Servicing Fee": With respect to each Mortgage Loan and for
any Distribution Date, an amount per calendar month equal to the product of
(i) one-twelfth of the related Servicing Fee Rate and (ii) the Scheduled
Principal Balance of such Mortgage Loan as of the Due Date in the month
preceding the month in which such Distribution Date occurs.
"Servicing Fee Rate": With respect to Mortgage Loan No.
______ , a rate equal to __________ % per annum. With respect to Mortgage
Loans No. ____________ , ______ , ____________ , ____________ , ____________ ,
_____________ and _________________ , a rate equal to ____% per annum. With
respect to each other Mortgage Loan, a rate equal to _________ %
per annum.
"Servicing Officer": Any officer or employee of the Servicer
or the Special Servicer involved in, or responsible for, the administration
and servicing of the Mortgage Loans or this Agreement and also, with respect
to a particular matter, any other officer or employee to whom such matter is
referred because of such officer's or employee's knowledge of and familiarity
with the particular subject, and, in the case of any certification required to
be signed by a Servicing Officer, such an officer or employee whose name and
specimen signature appears on a list of servicing officers furnished to the
Trustee by the Servicer or the Special Servicer, as applicable, as such list
may from time to time be amended, together with, in the case of a certificate
or other writing executed by an employee who constitutes a Servicing Officer
because of such employee's knowledge and familiarity with a particular
subject, a countersignature of an officer of the general partner of the
Servicer or of an officer of the Special Servicer, as appropriate.
"Servicing Standard": The standards for the conduct of the
Servicer and the Special Servicer in the performance of their obligations
under this Agreement set forth in Section 3.1(a).
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"Similar Law": As defined in Section 5.2(i).
"Special Servicer": _________ a ____________ _______, or its
successor in interest, or any successor Special Servicer appointed as herein
provided.
"Special Servicing Fee": With respect to any Specially
Serviced Mortgage Loan or REO Mortgage Loan and for any Distribution Date, an
amount per calendar month equal to the product of (i) one-twelfth of the
Special Servicing Fee Rate and (ii) the Scheduled Principal Balance of such
Specially Serviced Mortgage Loan or REO Mortgage Loan, as applicable, as of
the Due Date in the month preceding the month in which such Distribution Date
occurs.
"Special Servicing Fee Rate": A rate equal to % per
annum.
"Special Servicing Period": Any Interest Accrual Period
during which a Mortgage Loan is at any time a Specially Serviced Mortgage Loan.
"Specially Serviced Mortgage Loan": Subject to Section 3.24,
any Mortgage Loan (other than the Interest) with respect to
which:
(i) the related Borrower is __ or more days delinquent
(without giving effect to any grace period
permitted by the related Note) in the payment of a
Monthly Payment (regardless of whether, in respect
thereof, P&I Advances have been reimbursed);
(ii) such Borrower has expressed to the Servicer an
inability to pay or a hardship in paying such
Mortgage Loan in accordance with its terms;
(iii) the Servicer has received notice that such Borrower
has become the subject of any bankruptcy,
insolvency or similar proceeding, admitted in
writing the inability to pay its debts as they come
due or made an assignment for the benefit of
creditors;
(iv) the Servicer has received notice of a foreclosure
or threatened foreclosure of any lien on the
related Mortgaged Property;
(v) a default of which the Servicer has notice (other
than a failure by such Borrower to pay principal or
interest) and which materially and adversely
affects the interests of the Certificateholders has
occurred and remained unremedied for the applicable
grace period specified in such Mortgage Loan (or,
if no grace period is specified, __ days);
provided, however, that a default requiring a
Property Advance shall be deemed to materially and
adversely affect the interests of the
Certificateholders;
(vi) such Borrower has failed to make a Balloon Payment
as and when due; or
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(vii) the Servicer proposes to commence foreclosure or
other workout arrangements;
provided, however, that a Mortgage Loan will cease
to be a Specially Serviced Mortgage Loan:
(a) with respect to the circumstances
described in clause (i) and (vi) above,
when the related Borrower has brought such
Mortgage Loan current (with respect to the
circumstances described in clause (vi),
pursuant to any workout implemented by the
Special Servicer) and thereafter made
three consecutive full and timely Monthly
Payments;
(b) with respect to the circumstances
described in clauses (ii) and (iv) above,
when such circumstances cease to exist in
the good faith judgment of the Special
Servicer and with respect to the
circumstances described in clauses (iii)
and (vii), when such circumstances cease
to exist; or
(c) with respect to the circumstances
described in clause (v) above, when such
default is cured;
provided, however, that at the time no circumstance identified in clauses (i)
through (vii) above exists that would cause the Mortgage Loan to continue to
be characterized as a Specially Serviced Mortgage Loan.
"Startup Day": The day designated as such pursuant to
Section 2.6(a) hereof.
"Subordinate Certificates": Any one or more of the Class
___________ Certificates.
"Tax Returns": The federal income tax return on IRS Form
1066, U.S. Real Estate Mortgage Investment Conduit Income Tax Return,
including Schedule Q thereto, Quarterly Notice to Residual Interest Holders of
REMIC Taxable Income or Net Loss Allocation, or any successor forms, to be
filed on behalf of each of the Upper-Tier REMIC and Lower-Tier REMIC under the
REMIC Provisions, together with any and all other information, reports or
returns that may be required to be furnished to the Certificateholders or
filed with the IRS or any other governmental taxing authority under any
applicable provisions of federal, state or local tax laws.
"Termination Date": The Distribution Date on which the Trust
Fund is terminated pursuant to Section 9.1.
"Transfer": Any direct or indirect transfer or other form of
assignment of any Ownership Interest in a Class __ or Class __ Certificate.
36
"Transferee Affidavit": As defined in Section 5.2(j).
"Transferor Letter": As defined in Section 5.2(j).
"Trust Fund": The corpus of the trust created hereby and to
be _________ administered hereunder, consisting of: (i) such Mortgage Loans
(other than the Interest) as from time to time are subject to this Agreement,
together with the Mortgage Files relating thereto; (ii) the ________ Interest,
(iii) all payments on or collections in respect of such Mortgage Loans due
after the Cut-off Date; (iv) any REO Property; (v) all revenues received in
respect of REO Property; (vi) the Servicer's, the Special Servicer's and the
Trustee's rights under the insurance policies with respect to such Mortgage
Loans required to be maintained pursuant to this Agreement and any proceeds
thereof; (vii) any Assignments of Leases, Rents and Profits and any security
agreements; (viii) any indemnities or guaranties given as additional security
for such Mortgage Loans; (ix) the Trustee's right, title and interest in and
to the Reserve Accounts; (x) the Collection Account; (xi) the Distribution
Account and the REO Account, including reinvestment income, if any, thereon;
(xii) any environmental indemnity agreements relating to such Mortgaged
Properties; (xiii) the rights and remedies under the Mortgage Loan Purchase
and Sale Agreement; and (xiv) the proceeds of any of the foregoing (other than
any interest earned on deposits in any Reserve Account, to the extent such
interest belongs to the related Borrower).
"Trust REMICs": The Lower-Tier REMIC and the Upper-Tier
REMIC.
"Trustee": ____________________ , in its capacity as trustee,
or its successor in interest, or any successor trustee appointed as herein
provided.
"Trustee Fee": With respect to each Mortgage Loan and for
any Distribution Date, an amount per calendar month equal to the product of
(i) one-twelfth of the Trustee Fee Rate and (ii) the Scheduled Principal
Balance of such Mortgage Loan as of the Due Date in the month preceding the
month in which such Distribution Date occurs. The Trustee Fee shall be paid by
the Servicer on each Distribution Date.
"Trustee Fee Rate": A rate equal to ___________ % per annum.
"Trustee Mortgage File": With respect to any Mortgage Loan,
the mortgage documents listed in Section 2.1(i) through (xii) pertaining to
such Mortgage Loan, the documents listed in the third paragraph of Section 2.1
and any additional documents required to be deposited with the Trustee
pursuant to the express provisions of this Agreement.
"ULLICO": The Union Labor Life Insurance Company, a Maryland
corporation, as the Originator of seven of the Mortgage Loans.
"Uncovered Prepayment Interest Shortfall": For any
Distribution Date, any Prepayment Interest Shortfall not covered by the
Servicing Fee or the Special Servicing Fee pursuant to Section 3.25.
37
"Underwritten Cash Flow": With respect to any Mortgage Loan,
the cash flow available for debt service on the related Mortgage Loan for a
__-month period, as determined by _________ in accordance with the standards of
a prudent commercial mortgage lender based upon recent information supplied by
the related Borrower prior to the origination of such Mortgage Loan, and
adjusted, if determined appropriate by
, to: (a) deduct any non-cash items such as depreciation or
amortization; (b) deduct capital expenditures; (c) reflect a more appropriate
occupancy rate; (d) reflect replacement, capital expenditure and other
reserves required by the related Mortgage Loan Documents; (e) reflect a market
rate management fee; (f) exclude certain percentage rent, delinquent rents and
non-recurring income; (g) reflect an allowance for tenant improvements and
leasing commissions; and (h) reflect such other adjustments determined
appropriate by
"Unscheduled Payments": With respect to a Mortgage Loan and
a Collection Period, all Liquidation Proceeds, Condemnation Proceeds and
Insurance Proceeds payable under such Mortgage Loan, the Repurchase Price of
such Mortgage Loan if it is repurchased or purchased pursuant to Sections
2.3(d) or 2.3(e) and the price specified in Section 9.1 if such Mortgage Loan
is purchased or repurchased pursuant thereto, draws on any letters of credit
issued with respect to such Mortgage Loan and any other payments under or with
respect to such Mortgage Loan not scheduled to be made, including Principal
Prepayments (but excluding Prepayment Premiums) received during such
Collection Period.
"Updated Appraisal": As defined in Section 3.10(a).
"Upper-Tier REMIC": A segregated asset pool within the Trust
Fund consisting of the Lower-Tier Regular Interests and amounts held from time
to time in the Distribution Account.
"Voting Right": The portion of the voting rights of all of
the Certificates that is allocated to any Certificate or Class of
Certificates. At all times during the term of this Agreement, the percentage
of the Voting Rights assigned to each Class shall be (a) __%, in the case of
the _____ and _____ Certificates, (b) in the case of any of the Class ___,
Class ___, Class __, Class __, Class __, Class __, Class __, Class __ and
Class __ Certificates, a percentage equal to the product of (x) __% on and
prior to the EC Maturity Date and __% thereafter and (y) a fraction, the
numerator of which is equal to the aggregate outstanding Certificate Balance
of such Class of Certificates and the denominator of which is equal to the
aggregate outstanding Certificate Balances of all Classes of Certificates, (c)
in the case of the Class ___ Certificates, a percentage equal to __% on and
prior to the EC Maturity Date and __% thereafter, (d) in the case of the Class
___ Certificates, a percentage equal to __% and (e) in the case of the Class
___ Certificates, a percentage equal to __%. The Voting Rights of any Class of
Certificates shall be allocated among Holders of Certificates of such Class in
proportion to their respective Percentage Interests, except that any
Certificate registered in the name of the Depositor, the Servicer, any
Borrower, the Trustee, a Manager or any of their respective Affiliates shall
be deemed not to be outstanding for purposes of giving any consent (unless
such consent is to an action which would materially adversely affect in any
material respect the interests of the Certificateholders of any Class, while
the Servicer or any Affiliate thereof is the holder of Certificates
aggregating not less than _____% of the Percentage Interest of any such
38
Class). The aggregate Voting Rights of Holders of more than one Class of
Certificates shall be equal to the sum of the products of each such Holder's
Voting Rights and the percentage of Voting Rights allocated to the related
Class of Certificates.
"Weighted Average Net Mortgage Rate": With respect to any
Interest Accrual Period, a per annum rate equal to the weighted average of the
Net Mortgage Rates, as of the related Due Date (weighted on the basis of the
Scheduled Principal Balance of each Mortgage Loan).
"Yield Maintenance Loan": Any Mortgage Loan as to which the
related Note requires the payment of Prepayment Premiums calculated with
reference to a yield maintenance formula.
"Yield Maintenance Period": With respect to each Yield
Maintenance Loan, the period following the origination thereof during which
the related Note requires the payment of Prepayment Premiums calculated with
reference to a yield maintenance formula.
SECTION 1.2. Certain Calculations.
Unless otherwise specified herein, the following provisions
shall apply:
(a) All calculations of interest (including interest on the
Mortgage Loans) provided for herein shall be made on the basis of a ___-day
year consisting of _____ __-day months.
(b) The portion of any Insurance Proceeds, Condemnation
Proceeds, Liquidation Proceeds or Net REO Proceeds in respect of a Mortgage
Loan allocable to principal and Prepayment Premiums shall equal the total
amount of such proceeds minus (a) first any portion thereof payable to the
Servicer, the Special Servicer, the Trustee or the Fiscal Agent pursuant to
the provisions of this Agreement and (b) second any portion thereof equal to
interest on the unpaid principal balance of such Mortgage Loan at the related
Mortgage Rate less the related Servicing Fee from the Due Date as to which
interest was last paid by the related Borrower up to but not including the Due
Date in the Collection Period in which such proceeds are received. Allocation
of such amount between principal and Prepayment Premium shall be made first to
principal and second to Prepayment Premium.
(c) Any Mortgage Loan payment is deemed to be received on
the date such payment is actually received by the Servicer, the Special
Servicer or the Trustee; provided, however, that for purposes of calculating
distributions on the Certificates, Principal Prepayments with respect to any
Mortgage Loan are deemed to be received on the date they are applied in
accordance with Section 3.1(b) to reduce the outstanding principal balance of
such Mortgage Loan on which interest accrues.
39
SECTION 1.3. Certain Constructions.
For purposes of Section 3.10, Section 3.23 and Section
4.6(c), references to the most or next most subordinate Class of Certificates
outstanding at any time shall mean the most or next most subordinate Class of
Certificates then outstanding as among the Class
Certificates shall be considered to be one Class), and
references to the next most subordinate Class of Lower-Tier Regular Interests
outstanding at any time shall mean the most or next most subordinate Class of
Lower-Tier Regular Interests then outstanding as among the Class interests,
subject in each case to the rules of construction set forth in the following
sentences of this Section 1.3. Each Class of Certificates, shall be deemed to
be outstanding only to the extent its respective Certificate Balance has not
been reduced to zero or, with respect to the Class ___ Certificates, to the
extent that the EC Maturity Date has not occurred or with respect to the Class
___ Certificates, to the extent the Class ___ Notional Balance has not been
reduced to zero.
Unless the context clearly indicates otherwise, references
to section numbers are to sections of this Agreement.
40
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
SECTION 2.1. Conveyance and Assignment of Mortgage Loans;.
The Depositor, concurrently with the execution and delivery
hereof, does hereby sell, transfer, assign, set over and otherwise convey to
the Trustee without recourse (except to the extent herein provided) all the
right, title and interest of the Depositor in and to the Mortgage Loans,
including all rights to payment in respect thereof, except as set forth below,
and any security interest thereunder (whether in real or personal property and
whether tangible or intangible) in favor of the Depositor, and all Reserve
Accounts and all other assets included or to be included in the Trust Fund for
the benefit of the Certificateholders. Such transfer and assignment includes
all scheduled payments of interest and principal due after the Cut-off Date
(whether or not received) and all payments of interest and principal received
by the Depositor or the Servicer on or with respect to the Mortgage Loans
after the Cut-off Date. In connection with such transfer and assignment of all
interest and principal due with respect to the Mortgage Loans after the
Cut-off Date, the Depositor shall make a cash deposit to the Collection
Account on the Closing Date in an amount equal to the Cash Deposit. The
Depositor, concurrently with the execution and delivery hereof, does also
hereby sell, transfer, assign, set over and otherwise convey to the Trustee
without recourse (except to the extent provided herein) all the right, title
and interest of the Depositor in, to and under the Mortgage Loan Purchase and
Sale Agreement (other than its rights to indemnification pursuant to Section 4
thereof and rights to recovery of costs under Section 7 thereof). The
Depositor shall cause the Reserve Accounts to be transferred to and held in
the name of the Servicer on behalf of the Trustee as successor to the Mortgage
Loan Seller and ____________________
In connection with the transfer and assignment of Mortgage
Loans other than the ___________ Interest, the Depositor does hereby deliver
to, and deposit with, the Trustee, with a copy to the Servicer, the following
documents or instruments with respect to each Mortgage Loan so assigned:
(i) the original of the related Note, endorsed by the
Mortgage Loan Seller (or in the case of the seven
Mortgage Loans originated by ULLICO, by ULLICO) in
blank in the following form: "Pay to the order of
________________, without recourse" which the
Trustee or its designee is authorized to complete
and which Note and all endorsements thereof shall
show a complete chain of endorsement from the
Originator to the Mortgage Loan Seller;
(ii) the related original recorded Mortgage or a copy
thereof certified by the related title insurance
company, public recording office or closing agent
to be in the form in which executed or submitted
for recording, the related original recorded
Assignment of Mortgage from ________________
________ to the Mortgage Loan Seller or a copy
thereof certified by the related title
41
insurance company, public recording office or closing
agent to be in the form in which executed or
submitted for recording and the related original
Assignment of Mortgage executed by the Mortgage Loan
Seller in blank which the Trustee or its designee is
authorized to complete (and but for the insertion
of the name of the assignee and any related
recording information which is not yet available to
the Mortgage Loan Seller, is in suitable form for
recordation in the jurisdiction in which the
related Mortgaged Property is located); provided,
that with respect to each of the seven Mortgage
Loans originated by ULLICO, there will be the
related original Assignment of Mortgage executed by
ULLICO in blank which the Trustee or its designee
is authorized to complete (and but for the
insertion of the name of the assignee and any
related recording information which is not yet
available to the Mortgage Loan Seller, is in
suitable form for recordation in the jurisdiction
in which the related Mortgaged Property is
located);
(iii) if the related security agreement is separate from
the Mortgage, the original security agreement or a
counterpart thereof, and if the security agreement
is not assigned under the Assignments of Mortgage
described in clause (ii) above, the related
original assignment of such security agreement from
____________________ to the Mortgage Loan Seller or
a counterpart thereof and the related original
assignment of such security agreement executed by
the Mortgage Loan Seller in blank which the Trustee
or its designee is authorized to complete;
(iv) a copy of each Form UCC-1 financing statement, if
any, filed with respect to personal property
constituting a part of the related Mortgaged
Property, together with a copy of each Form UCC-2
or UCC-3 assignment, if any, of such financing
statement to the Mortgage Loan Seller from
____________________ and a copy of each Form UCC-2
or UCC-3 assignment, if any, of such financing
statement executed by the Mortgage Loan Seller in
blank which the Trustee or its designee is
authorized to complete (and but for the insertion
of the name of the assignee and any related filing
information which is not yet available to the
Mortgage Loan Seller, is in suitable form for
filing in the filing office in which such financing
statement was filed); provided, that with respect
to each of the seven Mortgage Loans originated by
ULLICO, there will be a copy of each Form UCC-2 or
UCC-3 Assignment, if any, of such financing
statement executed by ULLICO in blank which the
Trustee or its designee is authorized to complete
(and but for the insertion of the name of assignee
and any related filing information which is not yet
available to the Mortgage Loan Seller, is in
suitable form for filing in the filing office in
which such financing statement was filed);
(v) the related original of the Loan Agreement, if any,
relating to such Mortgage Loan or a counterpart
thereof;
42
(vi) the related original lender's title insurance
policy (or the original pro forma title insurance
policy), together with any endorsements thereto;
(vii) if any related Assignment of Leases, Rents and
Profits is separate from the Mortgage, the original
recorded Assignment of Leases, Rents and Profits or
a copy thereof certified by the related title
insurance company, public recording office or
closing agent to be in the form in which executed
or submitted for recording, the related original
recorded reassignment of such instrument, if any,
from _________ to the Mortgage Loan Seller or a
copy thereof certified by the related title
insurance company, public recording office or
closing agent to be in the form in which executed
or submitted for recording and the related original
reassignment of such instrument, if any, executed
by the Mortgage Loan Seller in blank which the
Trustee or its designee is authorized to complete
(and but for the insertion of the name of the
assignee and any related recording information
which is not yet available to the Mortgage Loan
Seller, is in suitable form for recordation in the
jurisdiction in which the related Mortgaged
Property is located) (any of which reassignments,
however, may be included in a related Assignment of
Mortgage and need not be a separate instrument);
(viii) copies of the original Environmental Reports with
respect to the Mortgaged Property made in
connection with origination of such Mortgage Loan;
(ix) if any related assignment of contracts is separate
from the Mortgage, the original assignment of
contracts or a counterpart thereof, and if the
assignment of contracts is not assigned under the
Assignments of Mortgage described in clause (ii)
above, the related original reassignment of such
instrument from ____________________ to the
Mortgage Loan Seller or a counterpart thereof and
the related original reassignment of such
instrument executed by the Mortgage Loan Seller in
blank which the Trustee or its designee is
authorized to complete;
(x) with respect to the related Reserve Accounts, if
any, a copy of the original of any separate
agreement with respect thereto between the related
Borrower and the Originator;
(xi) the original letter of credit, if any, with respect
thereto, together with any and all amendments
thereto, including, without limitation, any
amendment which entitles the Servicer to draw upon
such letter of credit on behalf of the Trustee for
the benefit of the Certificateholders,
and the original of each instrument or other item
of personal property given as security for a
Mortgage Loan possession of which by a secured
party is necessary to a secured party's valid,
perfected, first priority security interest
therein, together with all assignments or
endorsements thereof necessary to entitle
43
the Servicer to enforce a valid, perfected, first
priority security interest therein on behalf of the
Trustee for the benefit of the Certificateholders;
(xii) with respect to the related Reserve Accounts, if
any, a copy of the UCC-1 financing statements, if
any, submitted for filing with respect to the
Mortgage Loan Seller's security interest in such
Reserve Accounts and all funds contained therein,
together with a copy of each Form UCC-2 or UCC-3
assignment, if any, of such financing statement to
the Mortgage Loan Seller from ____________________
and a copy of each Form UCC-2 or UCC-3 assignment,
if any, of such financing statement executed by the
Mortgage Loan Seller in blank which the Trustee or
its designee is authorized to complete (and but for
the insertion of the name of the assignee and any
related filing information which is not yet
available to the Mortgage Loan Seller is in
suitable form for filing in the filing office in
which such financing statement was filed);
provided, that with respect to any Mortgage Loan
originated by ULLICO, there will be a copy of each
Form UCC-2 or UCC-3 Assignment, if any, of such
financing statement executed by ULLICO in blank
which the Trustee or its designee is authorized to
complete (and but for the insertion of the name of
the assignee and any related filing information
which is not yet available to the Mortgage Loan
Seller, is in suitable form for filing in the
filing office in which such financing statement was
filed); and
(xiii) copies of any and all amendments, modifications and
supplements to, and waivers related to, any of the
foregoing.
In connection with the transfer and assignment of the
___________ Interest, the Depositor does hereby deliver to the Trustee, with a
copy to the Servicer, with respect to the Interest, (i) the
_________________ Certificate, (ii) a copy of the Agreement and (iii) copies
of all releases of security interests relating to the Interest, such that the
Trustee shall hold good and valid title to the ________ Interest,
free and clear of any and all liens, encumbrances, pledges, charges or security
interests of any nature.
On or promptly following the Closing Date, the Trustee or
Custodian, as applicable, shall, to the extent possession thereof has been
delivered to it, complete any Assignment of Mortgage delivered pursuant to
clause (ii) above, any assignment of security agreement delivered pursuant to
clause (iii) above, any Form UCC-2 or UCC-3 assignment delivered pursuant to
clause (iv) and (xii) above, any reassignment of Assignment of Leases, Rents
and Profits delivered pursuant to clause (vii) above and any reassignment of
assignment of contracts delivered pursuant to clause (ix) above, in each case,
by inserting the name of the Trustee as assignee and delivering to the
Servicer (1) for recordation, (a) each Assignment of Mortgage referred to in
Section 2.1(ii) which has not yet been submitted for recordation and (b) each
reassignment of Assignment of Leases, Rents and Profits referred to in Section
2.1(vii) (if not otherwise included in the related Assignment of Mortgage)
which has not yet been submitted for recordation; and (2) for filing, each
UCC-2 or UCC-3 financing statement assignment
44
referred to in Section 2.1(iv) and (xii) which has not yet been submitted for
filing. On or promptly following the Closing Date, the Trustee or Custodian,
as applicable, shall, to the extent possession thereof has been delivered to
it, complete the endorsement of the Note by inserting the name of the Trustee
as endorsee. The Servicer shall, upon delivery, promptly submit for recording
or filing, as the case may be, in the appropriate public recording or filing
office, each such document. In the event that any such document is lost or
returned unrecorded because of a defect therein, the Servicer shall use its
best efforts to promptly prepare a substitute document for signature by the
Depositor, Mortgage Loan Seller or ULLICO, as applicable, and thereafter the
Servicer shall cause each such document to be duly recorded. The Servicer
shall, promptly upon receipt of the original of each such recorded document
(and in no event later than _____ Business Days following such receipt),
deliver such original to the Custodian. Notwithstanding anything to the
contrary contained in this Section 2.1, in those instances where the public
recording office retains the original Assignment of Mortgage or reassignment
of Assignment of Leases, Rents and Profits, if applicable, after any such
document has been recorded, the obligations hereunder of the Depositor shall
be deemed to have been satisfied upon delivery to the Custodian of a copy of
such Assignment of Mortgage or reassignment of Assignment of Leases, Rents and
Profits, if applicable, certified by the public recording office to be a true
and complete copy of the recorded original thereof. If a pro forma title
insurance policy has been delivered to the Custodian in lieu of an original
title insurance policy, the Depositor or the Servicer will promptly deliver to
the Custodian the related original title insurance policy upon receipt
thereof. The Depositor or the Servicer shall promptly cause the UCC-1s, UCC-2s
and UCC-3s referred to in Section 2.1(iv) and (xii) to be filed in the
applicable public recording or filing office and upon filing will promptly
deliver to the Custodian the related UCC-1, UCC-2 or UCC-3 with evidence of
filing thereon.
All original documents relating to the Mortgage Loans which
are not delivered to the Custodian are and shall be held by the Trustee or the
Servicer, as the case may be, in trust for the benefit of the
Certificateholders. In the event that any such original document is required
pursuant to the terms of this Section to be a part of a Trustee Mortgage File,
such document shall be delivered promptly to the Custodian.
If the Depositor cannot deliver any original or certified recorded document
described in Section 2.1 on the Closing Date, the Depositor shall use its best
efforts, promptly upon receipt thereof and in any case not later than __ days
from the Closing Date, to deliver or cause to be delivered such original or
certified recorded documents to the Custodian (unless the Depositor is delayed
in making such delivery by reason of the fact that such documents shall not
have been returned by the appropriate recording office, in which case the
Depositor or the Servicer shall notify the Custodian and the Trustee in
writing of such delay and shall deliver such documents to the Custodian
promptly upon the Depositor's or the Servicer's receipt thereof).
SECTION 2.2. Acceptance by the Custodian and the Trustee.
By its execution and delivery of this Agreement, the Trustee
acknowledges the assignment to it of the Mortgage Loans in good faith without
notice of adverse claims and declares that the Custodian holds and will hold
such documents and all others delivered to it
45
constituting the Trustee Mortgage File (to the extent the documents
constituting the Trustee Mortgage File are actually delivered to the
Custodian) for any Mortgage Loan assigned to the Trustee hereunder in trust,
upon the conditions herein set forth, for the use and benefit of all present
and future Certificateholders. The Trustee agrees to review each Trustee
Mortgage File within __ days after the later of (a) the Trustee's receipt of
such Trustee Mortgage File or (b) execution and delivery of this Agreement, to
ascertain that all documents referred to in Section 2.1 above (as identified
to it in writing by the Depositor or the Servicer) and any original recorded
documents referred to in the last sentence of Section 2.1 to be included in
the delivery of a Trustee Mortgage File, have been received, have been
executed, appear on their face to be what they purport to be, purport to be
recorded or filed (as applicable) and have not been torn, mutilated or
otherwise defaced, and that such documents relate to the Mortgage Loans
identified in the Mortgage Loan Schedule. In so doing, the Trustee may rely on
the purported due execution and genuineness of any such document and on the
purported genuineness of any signature thereon. If, at the conclusion of such
review, any document or documents constituting a part of a Trustee Mortgage
File have not been executed or received, have not been recorded or filed (if
required), are unrelated to the Mortgage Loans identified in the Mortgage Loan
Schedule, appear on their face not to be what they purport to be or have been
torn, mutilated or otherwise defaced, the Trustee shall promptly so notify the
Depositor and the Mortgage Loan Seller by providing a written report, setting
forth, for each affected Mortgage Loan, with particularity, the nature of the
defective or missing document. Neither the Servicer nor the Trustee shall be
responsible for any loss, cost, damage or expense to the Trust Fund resulting
from any failure to receive any document constituting a portion of a Trustee
Mortgage File noted on such a report or for any failure by the Depositor to
use its best efforts to deliver any such document.
In reviewing any Trustee Mortgage File pursuant to the
preceding paragraph or Section 2.1, the Trustee will have no responsibility to
determine whether any document or opinion is legal, valid, binding or
enforceable, whether the text of any assignment or endorsement is in proper or
recordable form (except, if applicable, to determine whether the Trustee is
the assignee or endorsee), whether any document has been recorded in
accordance with the requirements of any applicable jurisdiction, whether a
blanket assignment is permitted in any applicable jurisdiction, or whether any
Person executing any document or rendering any opinion is authorized to do so
or whether any signature thereon is genuine.
The Trustee shall hold that portion of the Trust Fund
delivered to the Trustee consisting of "instruments"(as such term is defined
in Section 9-105(i) of the Uniform Commercial Code as in effect in Illinois on
the date hereof) in Illinois and, except as set forth in Section 3.11 or as
otherwise specifically provided in this Agreement, shall not remove such
instruments from Illinois unless it receives an Opinion of Counsel (obtained
and delivered at the expense of the Person requesting the removal of such
instruments from Illinois) that in the event the transfer of the Mortgage
Loans to the Trustee is deemed not to be a sale, after such removal, the
Trustee will possess a first priority perfected security interest in such
instruments.
46
SECTION 2.3. Representations and Warranties of the Depositor.
(a) The Depositor hereby represents and warrants that:
(i) The Depositor is a corporation duly organized
validly existing and in good standing under the
laws of the State of Delaware;
(ii) The Depositor has taken all necessary action to
authorize the execution, delivery and performance
of this Agreement by it, and has the power and
authority to execute, deliver and perform this
Agreement and all the transactions contemplated
hereby, including, but not limited to, the power
and authority to sell, assign and transfer the
Mortgage Loans in accordance with this Agreement;
(iii) This Agreement has been duly and validly
authorized, executed and delivered by the Depositor
and assuming the due authorization, execution and
delivery of this Agreement by each other party
hereto, this Agreement and all of the obligations
of the Depositor hereunder are the legal, valid and
binding obligations of the Depositor, enforceable
in accordance with the terms of this Agreement,
except as such enforcement may be limited by
bankruptcy, insolvency, reorganization,
liquidation, receivership, moratorium or other laws
relating to or affecting creditors' rights
generally, or by general principles of equity
(regardless of whether such enforceability is
considered in a proceeding in equity or at law);
(iv) The execution and delivery of this Agreement and
the performance of its obligations hereunder by the
Depositor will not conflict with any provision of
its certificate of incorporation or bylaws, or any
law or regulation to which the Depositor is
subject, or conflict with, result in a breach of or
constitute a default under (or an event which, with
notice or lapse of time or both, would constitute a
default under) any of the terms, conditions or
provisions of any agreement or instrument to which
the Depositor is a party or by which it is bound,
or any order or decree applicable to the Depositor,
or result in the creation or imposition of any lien
on any of the Depositor's assets or property which
would materially and adversely affect the ability
of the Depositor to carry out the transactions
contemplated by this Agreement. The Depositor has
obtained any consent, approval, authorization or
order of any court or governmental agency or body
required for the execution, delivery and
performance by the Depositor of this Agreement;
(v) The certificate of incorporation of the Depositor
provides that the Depositor is permitted to engage
in only the following activities:
(A) to acquire, own, hold, sell, transfer,
assign, pledge, finance, refinance and
otherwise deal with (I) loans secured by
first or
47
second mortgages, deeds of trust or
similar liens on residential, commercial
or mixed commercial and residential
properties or shares issued by private
non-profit housing corporations, (II) any
participation interest in or security
based on or backed by any of the foregoing
(the loans described in clause (A)(I) and
the participation interests described in
clause (A)(II), collectively, "mortgage
loans"), or (III) various receivables
including, but not limited to, retail
automotive installment sale contracts or
loans or automotive leases, consumer or
commercial loans or leases, credit card
accounts, mobile home loans or insurance
policy loans ( "receivables");
(B) to authorize and issue one or more series
(each, a "series ") of pass-through
securities ( "certificates") pursuant to
pooling and servicing agreements (each, a
"pooling and servicing agreement"), each
of which series (I) represents ownership
interests in mortgage loans or
receivables, related property and/or
collections in respect thereof, and (II)
may be structured to contain one or more
classes or certificates, each class having
the characteristics specified in the
related pooling and servicing agreement,
and to acquire, own, hold, sell, transfer,
assign, pledge, finance or refinance one
or more certificates or classes of
certificates of any series; and
(C) to engage in any acts and activities and
exercise any powers permitted to
corporations under the laws of the State
of Delaware which are incidental to, or
connected with, the foregoing, and
necessary, suitable or convenient to
accomplish any of the foregoing;
(vi) There is no action, suit or proceeding pending
against the Depositor in any court or by or before
any other governmental agency or instrumentality
which would materially and adversely affect the
ability of the Depositor to carry out its
obligations under this Agreement; and
(vii) The Trustee, if not the owner of the Mortgage
Loans, will have a valid and perfected security
interest of first priority in each of the Mortgage
Loans and any proceeds thereof.
(b) The Depositor hereby represents and warrants with
respect to each Mortgage Loan that:
(i) Immediately prior to the transfer and assignment to
the Trustee, the related Note and the related
Mortgage and the ___________ Certificate were not
subject to an assignment or pledge, and the Depositor
had good title to, and was the sole owner of, such
Mortgage Loan and had full right
48
to transfer and sell such Mortgage Loan to the
Trustee free and clear of any encumbrance, lien,
pledge, charge, claim or security interest;
(ii) The Depositor is transferring such Mortgage Loan
free and clear of any and all liens, pledges,
charges or security interests of any nature
encumbering such Mortgage Loan ;
(iii) The related Assignment of Mortgage constitutes the
legal, valid and binding assignment of the related
Mortgage from the Depositor to the Trustee, and any
related reassignment of Assignment of Leases, Rents
and Profits constitutes the legal, valid and
binding assignment of any related Assignment of
Leases, Rents and Profits from the Depositor to the
Trustee;
(iv) No claims have been made by the Depositor under the
related lender's title insurance policy, and the
Depositor has not done, by act or omission,
anything which would impair the coverage of such
lender's title insurance policy; and
(v) To the best of the Depositor's knowledge, all of
the representations and warranties of ___________ or
the Mortgage Loan Seller, as applicable, contained
in the Mortgage Loan Purchase and Sale Agreement are
true and correct as of the date made.
(c) It is understood and agreed that the representations and
warranties set forth in this Section 2.3 shall survive delivery of the
respective Trustee Mortgage Files to the Trustee until the termination of this
Agreement, and shall inure to the benefit of the Certificateholders, the
Servicer and the Special Servicer.
(d) Upon discovery by the Custodian, the Servicer, the
Special Servicer or the Trustee of a breach of the representation and warranty
set forth in Section 2(c)(xli) of the Mortgage Loan Purchase and Sale
Agreement or that any Mortgage Loan otherwise fails to constitute a Qualified
Mortgage, such Person shall give prompt notice thereof to the Mortgage Loan
Seller and ___________ , and the Mortgage Loan Seller or _____________ , as
applicable, shall correct such condition or repurchase such Mortgage Loan at
the Repurchase Price within __ days of discovery of such failure; it being
understood and agreed that none of such Persons has an obligation to conduct
any investigation with respect to such matters.
(e) Upon discovery by the Custodian, the Servicer, the
Special Servicer or the Trustee of a breach of any representation or warranty
of the Mortgage Loan Seller or in the Mortgage Loan Purchase and Sale
Agreement (other than the representation set forth in Section 2(c)(xli)
thereof, but including without limitation the representation as to
Loan-to-Value Ratio and Debt Service Coverage Ratio set forth in Section
2(c)xxiii thereof), with respect to any Mortgage Loan, or that any document
required to be included in the Trustee Mortgage File with respect to a
Mortgage Loan does not conform to the requirements of Section 2.1, such Person
shall give prompt notice thereof to the Mortgage Loan Seller and
49
_____, and the Mortgage Loan Seller or __________, as applicable, shall, to
the extent the Mortgage Loan Seller or ___________ is obligated to cure such
breach or repurchase the related Mortgage Loan under the terms of the Mortgage
Loan Purchase and Sale Agreement, either cure such breach or repurchase such
Mortgage Loan at the Repurchase Price within __ days of the receipt of notice
of such breach, as the same may be extended, all pursuant to and as more
particularly described in the Mortgage Loan Purchase and Sale Agreement; it
being understood and agreed that none of the Custodian, the Servicer, the
Special Servicer and the Trustee has an obligation to conduct any
investigation with respect to such matters (except, in the case of the Trustee
Mortgage Files, to the extent provided in Sections 2.1 and 2.2).
(f) Upon receipt by the Servicer from the Depositor,
____________________ or the Mortgage Loan Seller of the Repurchase Price for a
repurchased Mortgage Loan, the Servicer shall deposit such amount in the
Collection Account, and the Trustee, pursuant to Section 3.11, shall, upon
receipt of a certificate of a Servicing Officer certifying as to the receipt
by the Servicer of the Repurchase Price and the deposit of the Repurchase
Price into the Collection Account pursuant to this Section 2.3(f), release or
cause to be released to the Depositor, ____________________ or the Mortgage
Loan Seller, as applicable, the related Trustee Mortgage File and shall
execute and deliver such instruments of transfer or assignment, in each case
without recourse, representation or warranty, as shall be prepared by the
Servicer to vest in the Depositor, ____________________ or the Mortgage Loan
Seller, as applicable, any Mortgage Loan released pursuant hereto, and any
rights of the Depositor in, to and under the Mortgage Loan Purchase and Sale
Agreement as it related to such Mortgage Loan that were initially transferred
to the Trust Fund under Section 2.1, and the Trustee and the Servicer shall
have no further responsibility with regard to such Trustee Mortgage File or
the related Mortgage Loan.
(g) In the event that the Mortgage Loan Seller incurs any
expense in connection with curing a breach of a representation or warranty
pursuant to Section 2.3(d) and (e) which also constitutes a default under the
related Mortgage Loan, the Mortgage Loan Seller shall have a right, and the
Mortgage Loan Seller shall be subrogated to the rights of the Trustee, as
successor to the mortgagee, to recover the amount of such expenses from the
related Borrower. The Servicer shall use reasonable efforts in recovering, or
assisting the Mortgage Loan Seller in recovering, from such Borrower the
amount of any such expenses.
(h) In the event that any litigation is commenced which
alleges facts which, in the judgment of the Depositor, could constitute a
breach of any of the Depositor's representations and warranties relating to
the Mortgage Loans, the Depositor hereby reserves the right to conduct the
defense of such litigation at its expense.
(i) The Servicer shall use its best efforts, in accordance
with the Servicing Standard, to enforce the obligations of the Mortgage Loan
Seller and __________ to cure or repurchase any Mortgage Loan which is
discovered to be a "Defective Mortgage Loan" (as such term is defined in the
Mortgage Loan Purchase and Sale Agreement) under the terms of the Mortgage
Loan Purchase and Sale Agreement.
50
SECTION 2.4. Representations, Warranties and Covenants of
the Servicer and the Special Servicer.
(a) The Servicer hereby represents, warrants and covenants
that as of the Closing Date, or as of such date specifically provided herein:
(i) The Servicer is a _______________, duly organized,
validly existing and in good standing under the
laws of the State of and has all licenses necessary
to carry on its business as now being conducted or
is in compliance with the laws of each state in
which any Mortgaged Property is located to the
extent necessary to ensure the enforceability of
each Mortgage Loan in accordance with the terms of
this Agreement;
(ii) The Servicer has the full partnership power,
authority and legal right to execute and deliver
this Agreement and to perform in accordance
herewith; the execution and delivery of this
Agreement by the Servicer and its performance and
compliance with the terms of this Agreement do not
violate the Servicer's certificate of
__________________ 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 contract, agreement or
other instrument to which the Servicer is a party
or which may be applicable to the Servicer or any
of its assets, which default or breach would have
consequences that would materially and adversely
affect the financial condition or operations of the
Servicer or its properties taken as a whole or
impair the ability of the Trust Fund to realize on
the Mortgage Loans;
(iii) This Agreement has been duly and validly
authorized, executed and delivered by the Servicer
and, assuming due authorization, execution and
delivery by the other parties hereto, constitutes a
legal, valid and binding obligation of the
Servicer, enforceable against it in accordance with
the terms of this Agreement, except as such
enforcement may be limited by bankruptcy,
insolvency, reorganization, liquidation,
receivership, moratorium or other laws relating to
or affecting creditors' rights generally, or by
general principles of equity (regardless of whether
such enforceability is considered in a proceeding
in equity or at law);
(iv) The Servicer is not in violation of, and the
execution and delivery of this Agreement by the
Servicer and its performance and compliance with
the terms of this Agreement will not constitute a
violation with respect to, any order or decree of
any court or any order or regulation of any
federal, state, municipal or governmental agency
having jurisdiction, or result in the creation or
imposition of any lien, charge or encumbrance
which, in any such event, would have consequences
that would materially and adversely affect the
financial condition or operations of the Servicer
or its
51
properties taken as a whole or impair the ability of
the Trust Fund to realize on the Mortgage Loans;
(v) There is no action, suit or proceeding pending or,
to the knowledge of the Servicer, threatened,
against the Servicer which, either in any one
instance or in the aggregate, would result in any
material adverse change in the business, operations
or financial condition of the Servicer or would, if
adversely determined, materially impair the ability
of the Servicer to perform under the terms of this
Agreement or which would draw into question the
validity of this Agreement or the Mortgage Loans or
of any action taken or to be taken in connection
with the obligations of the Servicer contemplated
herein;
(vi) No consent, approval, authorization or order of, or
registration or filing with, or notice to any court
or governmental agency or body is required for the
execution, delivery and performance by the Servicer
of, or compliance by the Servicer with, this
Agreement or, if required, such approval has been
obtained prior to the Cut-off Date, except to the
extent that the failure of the Servicer to be
qualified as a ____________ __________ or licensed
in one or more states is not necessary for the
enforcement of the Mortgage Loans; and
(vii) The Servicer is maintaining a fidelity bond and
errors and omissions coverage in accordance with
the requirements of Section 3.8(c) hereof.
(b) The Special Servicer hereby represents, warrants and
covenants that as of the Closing Date, or as of such date specifically
provided herein:
(i) The Special Servicer is a corporation, duly
organized, validly existing and in good standing
under the laws of the State of Florida and has all
licenses necessary to carry on its business as now
being conducted or is in compliance with the laws
of each state in which any Mortgaged Property is
located to the extent necessary to ensure the
enforceability of each Specially Serviced Mortgage
Loan in accordance with the terms of this
Agreement;
(ii) The Special Servicer has the full corporate power,
authority and legal right to execute and deliver
this Agreement and to perform in accordance
herewith; the execution and delivery of this
Agreement by the Special Servicer and its
performance and compliance with the terms of this
Agreement do not violate the Special Servicer's
certificate of incorporation 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 contract,
agreement or other instrument to which the Special
Servicer is a party or which may be applicable to
the Special Servicer or any of its assets, which
default or breach would have consequences that
52
would materially and adversely affect the condition
(financial or otherwise) or operations of the
Special Servicer or its properties, taken as a
whole, or impair the ability of the Trust Fund to
realize on the Specially Serviced Mortgage Loans;
(iii) This Agreement has been duly and validly
authorized, executed and delivered by the Special
Servicer and, assuming due authorization, execution
and delivery by the other parties hereto,
constitutes a legal, valid and binding obligation
of the Special Servicer, enforceable against it in
accordance with the terms of this Agreement, except
as such enforcement may be limited by bankruptcy,
insolvency, reorganization, liquidation,
receivership, moratorium or other laws relating to
or affecting creditors' rights generally, or by
general principles of equity (regardless of whether
such enforceability is considered in a proceeding
in equity or at law);
(iv) The Special Servicer is not in violation of, and
the execution and delivery of this Agreement by the
Special Servicer and its performance and compliance
with the terms of this Agreement will not
constitute a violation with respect to, any order
or decree of any court or any order or regulation
of any federal, state, municipal or governmental
agency having jurisdiction, or result in the
creation or imposition of any lien, charge or
encumbrance which, in any such event, would have
consequences that would materially and adversely
affect the condition (financial or otherwise) or
operations of the Special Servicer or its
properties taken as a whole or impair the ability
of the Trust Fund to realize on the Specially
Serviced Mortgage Loans;
(v) There is no action, suit or proceeding pending or,
to the knowledge of the Special Servicer,
threatened, against the Special Servicer which,
either in any one instance or in the aggregate,
would result in any material adverse change in the
business, operations or financial condition of the
Special Servicer or would, if adversely determined,
materially impair the ability of the Special
Servicer to perform under the terms of this
Agreement or which would draw into question the
validity of this Agreement or the Specially
Serviced Mortgage Loans or of any action taken or
to be taken in connection with the obligations of
the Special Servicer contemplated herein;
(vi) No consent, approval, authorization or order of, or
registration or filing with, or notice to any court
or governmental agency or body is required for the
execution, delivery and performance by the Special
Servicer of, or compliance by the Special Servicer
with, this Agreement or, if required, such approval
has been obtained prior to the Cut-off Date, except
to the extent that the failure of the Special
Servicer to be qualified as a __________
___________ or licensed in one or more states is
not
53
necessary for the enforcement of the Specially
Serviced Mortgage Loans; and
(vii) The Special Servicer is maintaining a fidelity bond
and errors and omissions coverage in accordance
with the requirements of Section 3.8(c) hereof.
(c) It is understood and agreed that the representations and
warranties set forth in this Section shall survive delivery of the Trustee
Mortgage Files to the Trustee or the Custodian on behalf of the Trustee until
the termination of this Agreement, and shall inure to the benefit of the
Trustee and the Depositor. Upon discovery by the Depositor, the Servicer, the
Special Servicer or a Responsible Officer of the Trustee (or upon written
notice thereof from any Certificateholder) of a breach of any of the
representations and warranties set forth in this Section which materially and
adversely affects the interests of the Certificateholders, the Servicer, the
Special Servicer or the Trustee with respect to any Mortgage Loan, the party
discovering such breach shall give prompt written notice to the other parties
hereto.
SECTION 2.5. Execution and Delivery of Certificates;
Issuance of Lower-Tier Regular Interests.
The Trustee acknowledges the assignment to it of the
Mortgage Loans and the delivery to it of the Trustee Mortgage Files to the
Custodian (to the extent the documents constituting the Trustee Mortgage Files
are actually delivered to the Custodian), subject to the provisions of Section
2.1 and Section 2.2 and, concurrently with such delivery, (i) acknowledges the
issuance of and hereby declares that it holds the Lower-Tier Regular Interests
on behalf of the Upper-Tier REMIC and the Holders of the Regular Certificates
and the Class __ Certificates and (ii) has caused to be executed and caused to
be authenticated and delivered to or upon the order of the Depositor, or as
directed by the terms of this Agreement, Class Certificates in authorized
denominations, in each case registered in the names set forth in such order of
the Depositor or as so directed in this Agreement and duly authenticated by
the Authenticating Agent, which Certificates (described in the preceding
clause (ii)) evidence ownership of the entire Trust Fund.
SECTION 2.6. Miscellaneous REMIC Provisions.
(a) The Class ___, Class ___, Class ___, Class ___, Class
___, Class ___, Class ___, Class ___, Class ___ and Class ___ Interests are
hereby designated as "regular interests" in the Lower-Tier REMIC within the
meaning of Section 860G(a)(1) of the Code, and the Class __ Certificates are
hereby designated as the sole class of "residual interests" in the Lower-Tier
REMIC within the meaning of Section 860G(a)(2) of the Code. The Class ___,
Class ___, Class ___, Class __, Class __, Class __, Class __, Class __, Class
__, Class __, Class ___ and Class ___ Certificates are hereby designated as
"regular interests" in the Upper-Tier REMIC within
54
the meaning of Section 860G(a)(1) of the Code and the Class __ Certificates
are hereby designated as the sole class of "residual interests" in the
Upper-Tier REMIC within the meaning of Section 860G(a)(2) of the Code. The
Closing Date is hereby designated as the "Startup Day" of the Lower-Tier REMIC
and the Upper-Tier REMIC within the meaning of Section 860G(a)(9) of the Code.
The "latest possible maturity date" of the Lower-Tier Regular Interests and
the Regular Certificates for purposes of Code Section 860G(a)(1) is the
Scheduled Final Distribution Date. The initial Certificate Balance of each
Class of Lower-Tier Regular Interests is equal to the Certificate Balance of
the Related Class of Certificates. The pass-through rate of each Class of
Lower- Tier Regular Interests is a per annum rate equal to the Lower-Tier
Pass-Through Rate.
(b) None of the Mortgage Loan Seller, Depositor, Trustee or
Servicer shall enter into any arrangement by which the Trust Fund will receive
a fee or other compensation for services other than as specifically
contemplated herein.
SECTION 2.7. Documents Not Delivered to Custodian.
All original documents relating to the Mortgage Loans which
are part of the Servicer Mortgage File are and shall be held by the Servicer,
in trust for the benefit of the Trustee on behalf of the Certificateholders.
The legal ownership of all records and documents with respect to each Mortgage
Loan prepared by or which come into the possession of the Servicer shall
immediately vest in the Trustee, in trust for the benefit of the
Certificateholders.
55
ARTICLE III
ADMINISTRATION AND SERVICING
OF THE MORTGAGE LOANS
SECTION 3.1. Servicer to Act as Servicer; Special Servicer
to Act as Special Servicer; Administration of
the Mortgage Loans.
(a) The Servicer and the Special Servicer, each as an
independent contractor, shall service and administer the Mortgage Loans (or in
the case of the Special Servicer, the Specially Serviced Mortgaged Loans and
the REO Mortgage Loans) on behalf of the Trust Fund solely in the best
interests of, and for the benefit of, all of the Certificateholders and the
Trustee (as trustee for the Certificateholders) in accordance with the terms
of this Agreement and the respective Mortgage Loans. In furtherance of, and to
the extent consistent with, the foregoing, and except to the extent that this
Agreement provides for a contrary specific course of action, each of the
Servicer and the Special Servicer shall service and administer each Mortgage
Loan in the same manner in which, and with the same care, skill, prudence and
diligence with which, it services and administers similar mortgage loans for
other third-party portfolios, giving due consideration to customary and usual
standards of practice of prudent institutional commercial mortgage loan
servicers used with respect to loans comparable to the Mortgage Loans, and
taking into account its other obligations hereunder, but without regard to:
(i) any other relationship that the Servicer, the
Special Servicer, any sub-servicer or any Affiliate
of the Servicer, the Special Servicer or any
subservicer may have with the related Borrower or
any Affiliate of such Borrower;
(ii) the ownership of any Certificate by the Servicer,
the Special Servicer or any Affiliate of either;
(iii) the Servicer's, the Trustee's or the Fiscal Agent's
obligation to make P&I Advances or Property
Advances or to incur servicing expenses with
respect to such Mortgage Loan;
(iv) the Servicer's, the Special Servicer's or any
sub-servicer's right to receive compensation for
its services hereunder or with respect to any
particular transaction; or
(v) the ownership or servicing or management for others
by the Servicer, the Special Servicer or any
sub-servicer, of any other mortgage loans or
property.
The standards set forth above with respect to the conduct of
the Servicer and the Special Servicer in the performance of their obligations
under this Agreement is herein referred to as the "Servicing Standard."
56
The Servicer's or the Special Servicer's liability for
actions and omissions in its capacity as Servicer or Special Servicer, as the
case may be, hereunder is limited as provided herein (including, without
limitation, pursuant to Section 6.3 hereof). To the extent consistent with the
foregoing and subject to any express limitations set forth in this Agreement,
the Servicer and the Special Servicer shall seek to maximize the timely and
complete recovery of principal and interest on the Notes; provided, however,
that nothing herein contained shall be construed as an express or implied
guarantee by the Servicer or the Special Servicer of the collectability of the
Mortgage Loans. Subject only to the above-described Servicing Standard and
the terms of this Agreement and of the respective Mortgage Loans, the Servicer
and the Special Servicer shall have full power and authority, acting alone or
through sub-servicers (subject to paragraph (c) of this Section 3.1 and to
Section 3.2), to do or cause to be done any and all things in connection with
such servicing and administration which they may deem necessary or desirable.
Without limiting the generality of the foregoing, the Servicer and the Special
Servicer shall, and each is hereby authorized and empowered by the Trustee to,
with respect to each Mortgage Loan and the related Mortgaged Property,
prepare, execute and deliver, on behalf of the Certificateholders and the
Trustee or any of them, any and all financing statements, continuation
statements and other documents or instruments necessary to maintain the lien
on the related Mortgaged Property and related collateral; any modifications,
waivers, consents or amendments to or with respect to any Mortgage Loan or any
documents contained in the related Mortgage File; and any and all instruments
of satisfaction or cancellation, or of partial or full release or discharge,
and all other comparable instruments, if, in its reasonable judgment, such
action is in the best interests of the Certificateholders and is in accordance
with, or is required by, this Agreement. Notwithstanding the foregoing,
neither the Servicer nor the Special Servicer shall modify, amend, waive or
otherwise consent to the change of the stated Maturity Date of any Mortgage
Loan, the payment of principal of, or interest or Default Interest on, any
Mortgage Loan, or any other term of a Mortgage Loan, unless (a) such
modification, amendment, waiver or consent is not a "significant modification"
under Section 1001 of the Code, including proposed, temporary or final
Treasury regulations thereunder, or Treasury Regulations Section
1.860G-2(b)(3) (other than clause (i) thereof), (b) to the extent such
modification, amendment, waiver or consent would constitute a "significant
modification" under the preceding clause (a), such Mortgage Loan is in default
or a default with respect thereto is reasonably foreseeable or (c) permitted
by Section 3.10 hereof. The Servicer and the Special Servicer shall service
and administer the Mortgage Loans in accordance with applicable state and
federal law and shall provide to the Borrowers any reports required to be
provided to them thereby. Subject to Section 3.11, the Trustee shall, upon the
receipt of a written request of a Servicing Officer, execute and deliver to
the Servicer and the Special Servicer any powers of attorney and other
documents prepared by the Servicer or the Special Servicer and necessary or
appropriate (as certified in such written request) to enable the Servicer and
the Special Servicer to carry out their servicing and administrative duties
hereunder; provided, however, that the Trustee shall not be liable for any
actions of the Servicer or Special Servicer under any such powers of attorney.
(b) Unless otherwise provided in the related Note, the
Servicer shall apply any partial Principal Prepayment received on a Mortgage
Loan on a date other than a Due Date to the principal balance of such Mortgage
Loan as of the Due Date immediately following the date of receipt of such
partial Principal Prepayment.
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(c) With respect to each Mortgage Loan that provides for
prepayment at the option of the mortgagee, the Servicer or the Special
Servicer, as applicable, shall exercise such option at the earliest possible
date as provided in the related Note and Mortgage Loan Documents.
(d) The Servicer or the Special Servicer may enter into
sub-servicing agreements with third parties with respect to any of its
respective obligations hereunder, provided that (1) any such agreement shall
be consistent with the provisions of this Agreement and (2) no sub-servicer
retained by the Servicer or the Special Servicer shall grant any modification,
waiver or amendment to any Mortgage Loan without the approval of the Servicer
or the Special Servicer, as applicable, which approval shall be given or
withheld in accordance with the procedures set forth in Section 3.10(a), and
(3) such agreement shall be consistent with the standards set forth in Section
3.1(a). Any such sub-servicing agreement may permit the sub-servicer to
delegate its duties to agents or subcontractors so long as the related
agreements or arrangements with such agents or subcontractors are consistent
with the provisions of this Section 3.1(c).
Any sub-servicing agreement entered into by the Servicer or
the Special Servicer, shall provide that it may be assumed or terminated by
the Trustee if the Trustee or a successor Servicer or Special Servicer has
assumed the duties of the Servicer or the Special Servicer, as applicable,
without cost or obligation to the assuming or terminating party or the Trust
Fund, upon the assumption by the Trustee or a successor Servicer or Special
Servicer of the obligations of the Servicer or the Special Servicer, as
applicable, pursuant to Section 7.2.
Any sub-servicing agreement, and any other transactions or
services relating to the Mortgage Loans involving a sub-servicer, shall be
deemed to be between the Servicer or the Special Servicer, as applicable, and
such sub-servicer alone, and the Trustee and the Certificateholders shall not
be deemed parties thereto and shall have no claims, rights, obligations,
duties or liabilities with respect to the sub-servicer, including the
Depositor acting in such capacity, except as set forth in Section 3.1(d).
(e) If the Trustee or any successor Servicer or Special
Servicer assumes the obligations of the Servicer or the Special Servicer, as
applicable, in accordance with Section 7.2, the Trustee or such successor
Servicer or Special Servicer, to the extent necessary to permit the Trustee or
such successor Servicer or Special Servicer to carry out the provisions of
Section 7.2, shall, without act or deed on the part of the Trustee or such
successor Servicer or Special Servicer, succeed to all of the rights and
obligations of the Servicer or Special Servicer under any sub-servicing
agreement entered into by the Servicer or Special Servicer pursuant to Section
3.1(c), subject to the right of termination by the Trustee set forth in
Section 3.1(c). In such event, the Trustee or such successor Servicer or
Special Servicer shall be deemed to have assumed all of the Servicer's or
Special Servicer's interest therein (but not any liabilities or obligations in
respect of acts or omissions of the Servicer or Special Servicer prior to such
deemed assumption) and to have replaced the Servicer or the Special Servicer,
as applicable, as a party to such sub-servicing agreement to the same extent
as if such sub-servicing agreement had been assigned to the Trustee or such
successor Servicer, except that the Servicer or the Special Servicer shall not
thereby be relieved of any liability or obligations under such
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sub-servicing agreement that accrued prior to the assumption of duties hereunder
by the Trustee or such successor Servicer or Special Servicer.
In the event that the Trustee or any successor Servicer or
Special Servicer assumes the servicing obligations of the Servicer or the
Special Servicer, as the case may be, upon request of the Trustee or such
successor Servicer or Special Servicer, as the case may be, the Servicer or
Special Servicer shall, at its own expense, deliver to the Trustee or such
successor Servicer or Special Servicer (as the case may be) all documents and
records relating to any sub-servicing agreement and the Mortgage Loans then
being serviced thereunder and an accounting of amounts collected and held by
it, if any, and the Servicer will otherwise use its best efforts to effect the
orderly and efficient transfer of any sub-servicing agreement to the Trustee
or such successor Servicer.
(f) Notwithstanding anything herein to the contrary, the
Servicer shall service the ___________ Interest in accordance with the
__________ Agreement, and in connection therewith, the Servicer shall (i)
receive the payments due and payable with respect to the ___________ Interest
and deposit such payments into the Collection Account in accordance with
Section 3.5 of this Agreement, (ii) enforce _________ the Agreement and all
other documentation with respect thereto in accordance with the ____________
Agreement and this Agreement and (iii) take such other actions with respect
thereto as shall be required in accordance with the Servicing Standard and
this Agreement (including, without limitation, making Advances with respect to
the Trust Fund's participation interest in the ____________ Loan as evidenced
by the _____________ Certificate) to the extent and in the manner provided
herein with respect to the making of Advances for other Mortgage Loans.
Pursuant to the ___________ Agreement, the Servicer shall pay as an expense of
the Trust Fund (i) to the special servicer under the Prior Pooling and
Servicing Agreement a proportionate share of any special servicing fee that
becomes due with respect to the _________ Loan if and when the
________________ Loan becomes a specially serviced mortgage loan under the
Prior Pooling and Servicing Agreement and (ii) to the servicer under the Prior
Pooling and Servicing Agreement a proportionate share of (x) the amount of any
property advances made under the Prior Pooling and Servicing Agreement deemed
to be nonrecoverable advances thereunder and (y) the advance interest amount
which has accrued on any reimbursed property advances incurred with respect to
the ___________ Loan under the Prior Pooling and Servicing Agreement.
SECTION 3.2. Liability of the Servicer.
Notwithstanding any sub-servicing agreement, any of the
provisions of this Agreement relating to agreements or arrangements between
the Servicer or Special Servicer and any Person acting as sub-servicer (or its
agents or subcontractors) or any reference to actions taken through any Person
acting as sub-servicer or otherwise, the Servicer or the Special Servicer, as
applicable, shall remain obligated and primarily liable to the Trustee and
Certificateholders for the servicing and administering of the Mortgage Loans
in accordance with the provisions of this Agreement without diminution of such
obligation or liability by virtue of such sub-servicing agreements or
arrangements or by virtue of indemnification from the Depositor or any Person
acting as sub-servicer (or its agents or subcontractors) to the same
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extent and under the same terms and conditions as if the Servicer or Special
Servicer, as applicable, were servicing and administering the Mortgage Loans
alone. The Servicer or the Special Servicer, as applicable, shall be entitled
to enter into an agreement with any sub-servicer providing for indemnification
of the Servicer or the Special Servicer, as applicable, by such sub-servicer,
and nothing contained in this Agreement shall be deemed to limit or modify
such indemnification, but no such agreement for indemnification shall be
deemed to limit or modify this Agreement.
SECTION 3.3. Collection of Certain Mortgage Loan Payments.
The Servicer and the Special Servicer shall make reasonable
efforts to collect all payments called for under the terms and provisions of
the Mortgage Loans when the same shall be due and payable, and shall follow
such collection procedures as it would follow with respect to mortgage loans
comparable to the Mortgage Loans and held for other third-party portfolios,
including using its best efforts in accordance with the Servicing Standard to
collect income statements and rent rolls from the related Borrowers as
required by the related Mortgage Loan Documents and providing (in the case of
the Servicer only) reasonable advance notice to such Borrowers of Balloon
Payments due with respect to such Mortgage Loans. Consistent with the
foregoing, the Servicer or the Special Servicer, as applicable, may in its
discretion waive any late payment charge or penalty fees in connection with
any delinquent Monthly Payment or Balloon Payment with respect to any Mortgage
Loan.
SECTION 3.4. Collection of Taxes, Assessments and Similar
Items.
(a) With respect to each Mortgage Loan (other than REO
Mortgage Loans), the Servicer shall maintain accurate records with respect to
each related Mortgaged Property reflecting the status of taxes, assessments
and other similar items that are or may become a lien on such related
Mortgaged Property, the status of insurance premiums payable with respect
thereto and the amounts of Escrow Payments, if any, required in respect
thereof. From time to time, the Servicer shall (i) obtain all bills for the
payment of such items (including renewal premiums), and (ii) effect payment of
all such bills with respect to each such Mortgaged Property prior to the
applicable penalty or termination date, in each case employing for such
purpose Escrow Payments as allowed under the terms of such Mortgage Loan. If a
Borrower fails to make any such Escrow Payment on a timely basis or
collections from such Borrower are insufficient to pay any such item before
the applicable penalty or termination date, the Servicer shall (in accordance
with Section 3.8 with respect to the payment of insurance premiums) advance
the amount necessary to effect payment of any such item, unless the Servicer,
in its good faith business judgment, determines that such Advance would be a
Nonrecoverable Advance. With respect to any Mortgage Loan as to which the
related Borrower is not required to make Escrow Payments, if such Borrower
fails to effect payment of any such ▇▇▇▇, then, the Servicer shall (in
accordance with Section 3.8 with respect to the payment of insurance premiums)
advance the amount necessary to effect payment of any such ▇▇▇▇ on or before
the applicable penalty or termination date unless, with respect to the payment
of taxes and assessments, (x) the Servicer reasonably anticipates that such
▇▇▇▇ will be paid by the Borrower by the close of business on or before the
penalty date, but in any event the Servicer shall make such advance (subject
to clause (y) below) within __ days after such date or within ____
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Business Days after the Servicer has received confirmation that such item has
not been paid, whichever is earlier, or (y) the Servicer determines, in its
good faith business judgment, that such Property Advance would be a
Nonrecoverable Advance. The Servicer shall be entitled to reimbursement of
Property Advances that it makes pursuant to the preceding sentence, with
interest thereon at the Advance Rate, from amounts received on or in respect
of the Mortgage Loan respecting which such Property Advance was made or if
such Property Advance has become a Nonrecoverable Advance, to the extent
permitted by Section 3.6 of this Agreement. No costs incurred by the Servicer
in effecting the payment of taxes and assessments on the Mortgaged Properties
shall, for the purpose of calculating distributions to Certificateholders, be
added to the amount owing under the related Mortgage Loans, notwithstanding
that the terms of such Mortgage Loans so permit.
(b) The Servicer shall segregate and hold all funds
collected and received pursuant to any Mortgage Loan constituting Escrow
Payments separate and apart from any of its own funds and general assets and
shall establish and maintain one or more segregated custodial accounts (each,
an "Escrow Account") into which all Escrow Payments shall be deposited within
______ Business Day after receipt. The Servicer shall also deposit into each
Escrow Account any amounts representing losses on Permitted Investments in
which amounts on deposit in such Escrow Account have been invested pursuant to
Section 3.7(b) and any Insurance Proceeds, Condemnation Proceeds or
Liquidation Proceeds which are required to be applied to the restoration or
repair of the related Mortgaged Property pursuant to the related Mortgage
Loan. Escrow Accounts shall be Eligible Accounts and shall be entitled, " , as
Servicer, in trust for , as Trustee in trust for Holders of Prudential
Securities Secured Financing Corporation, Commercial Mortgage Pass-Through
Certificates, Series , and Various Borrowers." Withdrawals from an Escrow
Account may be made by the Servicer only:
(i) to effect timely payments of items with respect to
which Escrow Payments are required pursuant to the
related Mortgage;
(ii) to transfer funds to the Collection Account to
reimburse the Servicer, the Trustee or the Fiscal
Agent, as applicable, for any Advance relating to
Escrow Payments, but only from amounts received
with respect to the related Mortgage Loan which
represent late collections of Escrow Payments
thereunder;
(iii) for application to the restoration or repair of the
related Mortgaged Property in accordance with the
related Mortgage Loan and the Servicing Standard;
(iv) to clear and terminate such Escrow Account upon the
termination of this Agreement;
(v) to pay from time to time to the Servicer any
interest or investment income earned on funds
deposited in such Escrow Account pursuant to
Section 3.7(b) to the extent (a) permitted by law
and (b) not required to be paid
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to the related Borrower under the terms of the
related Mortgage Loan or by law, or to pay such
interest or income to the related Borrower if such
income is required to paid to the related Borrower
under law or by the terms of the related Mortgage
Loan;
(vi) to remit to the related Borrower the Financial and
Lease Reporting Fee as and when required pursuant
to the related Mortgage; and
(vii) to remove any funds deposited in such Escrow
Account that were not required to be deposited
therein.
SECTION 3.5. Collection Account; Distribution Account.
(a) The Servicer shall establish and maintain the Collection
Account in the Trustee's name, for the benefit of the Certificateholders and
the Trustee as the Holder of the Lower-Tier Regular Interests. The Collection
Account shall be established and maintained as an Eligible Account. The
Servicer shall deposit or cause to be deposited in the Collection Account
within ___ Business Day following receipt the following payments and
collections received or made by it on or with respect to the Mortgage Loans:
(i) all payments on account of principal on the
Mortgage Loans, including the principal component
of Unscheduled Payments on the Mortgage Loans;
(ii) all payments on account of interest and Default
Interest on the Mortgage Loans and the interest
portion of all Unscheduled Payments and all
Prepayment Premiums;
(iii) any amounts required to be deposited pursuant to
Section 3.7(b) in connection with losses realized
on Permitted Investments with respect to funds held
in the Collection Account and pursuant to Section
3.25 in connection with Prepayment Interest
Shortfalls;
(iv) (x) all Net REO Proceeds transferred from an REO
Account pursuant to Section 3.17(b) and (y) all
Condemnation Proceeds, Insurance Proceeds and Net
Liquidation Proceeds not required to be applied to
the restoration or repair of the related Mortgaged
Property;
(v) any amounts received from Borrowers which represent
recoveries of Property Protection Expenses or
Property Advances made pursuant to Section 3.4;
(vi) any other amounts required by the provisions of
this Agreement to be deposited into the Collection
Account by the Servicer or the Special Servicer,
including, without limitation, proceeds of any
purchase or repurchase of a Mortgage Loan pursuant
to Section 2.3(d) or (e), Section 3.18 or Section
9.1 hereof; and
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(vii) all amounts collected in respect of the ___________
Interest.
The foregoing requirements for deposits in the Collection
Account shall be exclusive, it being understood and agreed that, without
limiting the generality of the foregoing, payments in the nature of late
payment charges, late fees, Assumption Fees, loan modification fees, loan
service transaction fees, extension fees, demand fees, beneficiary statement
charges and similar fees need not be deposited in the Collection Account by
the Servicer and, to the extent permitted by applicable law, the Servicer or
the Special Servicer, as applicable, shall be entitled to retain any such
charges and fees received with respect to the Mortgage Loans. In the event
that the Servicer deposits in the Collection Account any amount not required
to be deposited therein, the Servicer may at any time withdraw such amount
from the Collection Account, any provision herein to the contrary
notwithstanding.
(b) The Trustee shall establish and maintain the
Distribution Account in the name of the Trustee, in trust for the benefit of
the Certificateholders. The Distribution Account shall be established and
maintained as an Eligible Account.
(c) Funds in the Collection Account and the Distribution
Account may be invested in Permitted Investments in accordance with the
provisions of Section 3.7. The Servicer shall give written notice to the
Trustee of the location and account number of the Collection Account and shall
notify the Trustee in writing prior to any subsequent change thereof.
SECTION 3.6. Permitted Withdrawals from the Collection
Account.
The Servicer may make withdrawals from the Collection
Account only as described below (the order set forth below not constituting an
order of priority for such withdrawals):
(i) to remit to the Trustee, for deposit in the
Distribution Account, the amounts required to be
deposited in the Distribution Account pursuant to
Section 4.6;
(ii) to pay or reimburse the Servicer, the Trustee or
the Fiscal Agent for Advances, the right of the
Servicer, the Trustee or the Fiscal Agent to
reimburse itself pursuant to this clause (ii) being
limited to either (x) any collections on or in
respect of the particular Mortgage Loan or REO
Property respecting which each such Advance was
made, or (y) any other amounts in the Collection
Account in the event that such Advances have been
deemed to be Nonrecoverable Advances or are not
recovered from recoveries in respect of the related
Mortgage Loan or REO Property after a Final
Recovery Determination;
(iii) to pay to the Servicer, the Trustee or the Fiscal
Agent the Advance Interest Amount;
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(iv) to pay on or before each Remittance Date to the
Servicer and the Special Servicer, as applicable,
as compensation, the unpaid Servicing Fee and
Special Servicing Fee, respectively, in respect of
the related Distribution Date (in each case,
reduced up to the amount of any Prepayment Interest
Shortfalls with respect to such Distribution Date,
in accordance with Section 3.25), to be paid, in
the case of the Servicing Fee, from interest
received on the related Mortgage Loans, and to pay
from time to time, to the Servicer any interest or
investment income earned on funds deposited in the
Collection Account, and to pay to the Servicer as
additional Servicing Compensation any Prepayment
Interest Surplus received in the preceding
Collection Period and to pay to the Servicer or the
Special Servicer, as applicable, any other amounts
constituting Servicing Compensation;
(v) to pay on or before each Distribution Date to the
Depositor, the Mortgage Loan Seller,
____________________ or the purchaser of any
Specially Serviced Mortgage Loan or REO Property,
as the case may be, with respect to each Mortgage
Loan or REO Property that has previously been
purchased or repurchased by it pursuant to Section
2.3(d), 2.3(e), Section 3.18 or Section 9.1, all
amounts received thereon during the related
Collection Period and subsequent to the date as of
which the amount required to effect such purchase
or repurchase was determined;
(vi) to the extent not reimbursed or paid pursuant to
any other clause of this Section 3.6, to reimburse
or pay the Servicer, the Special Servicer, the
Trustee, the Depositor and/or the Fiscal Agent for
unpaid items incurred by or on behalf of such
Person pursuant to the second sentence of Section
3.1(f), the second sentence of Section 3.7(c),
Section 3.8(a), Section 3.10, Section 3.12(d),
Section 3.17(a), (b) and (c), Section 3.18(a), 6.3,
7.4, 8.5(d), 9.1(d) or Section 10.7, or any other
provision of this Agreement pursuant to which such
Person is entitled to reimbursement or payment from
the Trust Fund, in each case only to the extent
reimbursable under such Section, it being
acknowledged that this clause (vi) shall not be
deemed to modify the substance of any such Section,
including the provisions of such Section that set
forth the extent to which one of the foregoing
Persons is or is not entitled to payment or
reimbursement;
(vii) to deposit in one or more separate, non-interest
bearing accounts any amount reasonably determined
by the Trustee to be necessary to pay any
applicable federal, state or local taxes imposed on
the Lower-Tier REMIC under the circumstances and to
the extent described in Section 4.5;
(viii) to withdraw any amount deposited into the
Collection Account that was not required to be
deposited therein; and
(ix) to clear and terminate the Collection Account
pursuant to Section 9.1.
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The Servicer shall keep and maintain separate accounting, on
a Mortgage Loan-by-Mortgage Loan basis, for the purpose of justifying any
withdrawal from the Collection Account pursuant to subclauses (ii) - (viii)
above.
The Servicer shall pay to the Trustee or the Special
Servicer from the Collection Account (to the extent permitted by clauses
(i)-(viii) above) amounts permitted to be paid to the Trustee or the Special
Servicer therefrom, promptly upon receipt of a certificate of a Responsible
Officer of the Trustee or a Servicing Officer of the Special Servicer, as
applicable, describing the item and amount to which the Trustee or the Special
Servicer is entitled. The Servicer may rely conclusively on any such
certificate and shall have no duty to recalculate the amounts stated therein.
The Trustee, the Special Servicer and the Servicer shall in
all cases have a right prior to the Certificateholders to any funds on deposit
in the Collection Account from time to time for the reimbursement or payment
of Servicing Compensation, Advances (subject to the limitation set forth in
Section 3.6(ii)) and their respective expenses (including Advance Interest
Amounts) hereunder to the extent such expenses are to be reimbursed or paid
from amounts on deposit in the Collection Account pursuant to this Agreement.
SECTION 3.7. Investment of Funds in the Collection Account,
the Distribution Account and the Reserve
Accounts.
(a) The Servicer (or with respect to any REO Account, the
Special Servicer) may direct (or, with respect to the Distribution Account,
cause the Trustee to direct) any depository institution maintaining the
Collection Account, the Distribution Account, any REO Account or (subject to
applicable laws and the related Mortgage Loan Documents) any Reserve Accounts
(each, for purposes of this Section 3.7, an "Investment Account") to invest
the funds in such Investment 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 preceding the date on which such funds
are requited to be withdrawn from such Investment Account pursuant to this
Agreement; provided, however, that all investments in the Distribution
Account, including those payable on demand, shall mature no later than the
Business Day prior to the next Distribution Date. Any direction by the
Servicer (or with respect to an REO Account, the Special Servicer) to invest
funds on deposit in an Investment Account shall be in writing and shall
certify that the requested investment is a Permitted Investment which matures
at or prior to the time required hereby or is payable on demand. In the case
of any Reserve Account, the Servicer shall act upon the written request of the
related Borrower or Manager to the extent the Servicer is required to do so
under the terms of the related Mortgage Loan, provided that in the absence of
appropriate written instructions from such Borrower or Manager meeting the
requirements of this Section 3.7, the Servicer shall have no obligation to,
but will be entitled to, direct the investment of funds in such Reserve
Accounts. All such Permitted Investments shall be held to maturity, unless
payable on demand. Any investment of funds in an Investment Account shall be
made in the name of the Trustee (in its capacity as such) or in the name of a
nominee of the Trustee. The Trustee shall have sole control (except with
respect to investment direction which shall be in the sole control of the
Servicer or the Special Servicer, as applicable, as an independent contractor
to the Trust Fund) over each such investment and
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any certificate or other instrument evidencing any such investment shall be
delivered directly to the Trustee or its agent (which shall initially be the
Servicer), together with any document of transfer, if any, necessary to
transfer title to such investment to the Trustee or its nominee. The Trustee
shall have no responsibility or liability with respect to the investment
directions of the Servicer or the Special Servicer or any losses resulting
therefrom, whether from Permitted Investments or otherwise. In the event
amounts on deposit in an Investment Account are at any time invested in a
Permitted Investment payable on demand, the Servicer or the Special Servicer,
as applicable, shall:
(x) consistent with any notice required to be
given thereunder, demand that payment
thereon be made on the _____ day such
Permitted Investment may otherwise mature
hereunder in an amount equal to the lesser
of (1) all amounts then payable thereunder
and (2) the amount required to be
withdrawn on such date; and
(y) demand payment of all amounts due
thereunder promptly upon determination by
the Servicer or the Special Servicer, as
applicable, that such Permitted Investment
would not constitute a Permitted
Investment in respect of funds thereafter
on deposit in the related Investment
Account.
(b) All income and gain realized from investment of funds
deposited in the Collection Account, the Distribution Account and any Reserve
Account as to which the related Borrower is not entitled to interest thereon
shall be for the benefit of the Servicer (other than income or gain realized
from investment of funds on deposit in the Distribution Account made by the
Trustee on the Business Day prior to any Distribution Date that matures on
such Distribution Date) and all income and gain realized from investment of
funds deposited in any REO Account shall be for the benefit of the Special
Servicer and, other than with respect to the Distribution Account, may be
withdrawn by the Servicer or the Special Servicer, as applicable, from time to
time in accordance with Section 3.6 and Section 3.17(b), as applicable. The
Servicer may request that the Trustee withdraw and remit to the Servicer all
amounts due to it with respect to the Distribution Account pursuant to the
preceding sentence. The Servicer shall deposit from its own funds in the
Collection Account and the Distribution Account, as the case may be, the
amount of any loss incurred in respect of any such Permitted Investment
immediately upon realization of such loss and the Special Servicer shall
deposit from its own funds in any REO Account the amount of any loss incurred
in respect of any such Permitted Investment immediately upon realization of
such loss. The Servicer shall also deposit into each Reserve Account any
amounts representing losses on Permitted Investments in which such Reserve
Accounts have been invested, except to the extent that amounts are invested
for the benefit of the Borrower under applicable law or the terms of the
related Mortgage Loan. The income and gain realized from investment of funds
deposited in any Reserve Account shall be paid from time to time to the
related Borrower to the extent required under the Mortgage Loan or applicable
law.
(c) Except as otherwise expressly provided in this
Agreement, if any default occurs in the making of a payment due under any
Permitted Investment, or if a default occurs
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in any other performance required under any Permitted Investment, the Trustee
may, and upon the request of Holders of Certificates representing at least __%
of the aggregate Voting Rights of any Class shall, take such action as may be
appropriate to enforce such payment or performance, including the institution
and prosecution of appropriate proceedings. In the event the Trustee takes any
such action, the Trust Fund shall pay or reimburse the Trustee for all
reasonable out-of-pocket expenses, disbursements and advances incurred or made
by the Trustee in connection therewith. In the event that the Trustee does not
take any such action, the Servicer may take such action at its own cost and
expense.
SECTION 3.8. Maintenance of Insurance Policies and Errors
and Omissions and Fidelity Coverage.
(a) The Servicer on behalf of the Trustee, as mortgagee,
shall use its best efforts in accordance with the Servicing Standard to cause
the related Borrower to maintain for each Mortgage Loan (other than REO
Mortgage Loans), and if the Borrower does not so maintain, shall itself
maintain (subject to the provisions of this Agreement concerning
Nonrecoverable Advances) to the extent the Trustee as mortgagee has an
insurable interest and to the extent available at commercially reasonable
rates, (A) fire and hazard insurance with extended coverage on the related
Mortgaged Property in an amount which is at least equal to the lesser of (i)
___________ percent (___%) of the then "full replacement cost" of the
improvements and equipment (excluding foundations, footings and excavation
costs), without deduction for physical depreciation, and (ii) the outstanding
principal balance of the related Mortgage Loan or such other amount as is
necessary to prevent any reduction in such policy by reason of the application
of co-insurance and to prevent the Trustee thereunder from being deemed to be
a co-insurer, (B) insurance providing coverage against ___ months of rent
interruptions and (C) such other insurance (including public liability
insurance) as provided in the related Mortgage Loan. The Special Servicer
shall maintain, to the extent available at commercially reasonable rates, fire
and hazard insurance from a Qualified Insurer with extended coverage on each
REO Property in an amount which is at least equal to ___________ percent
(___%) of the then "full replacement cost" of the improvements and equipment
(excluding foundations, footings and excavation costs), without deduction for
physical depreciation. The Special Servicer shall maintain (subject to the
provisions of this Agreement regarding Nonrecoverable Advances), to the extent
available at commercially reasonable rates, with respect to each REO Property
(A) public liability insurance providing such coverage against such risks as
the Servicer or the Special Servicer, as applicable, determines, consistent
with the related Mortgage and the Servicing Standard, to be in the best
interests of the Trust Fund, and shall cause to be maintained with respect to
each REO Property (B) insurance providing coverage against ___ months of rent
interruptions, and (C) such other insurance as provided in the related
Mortgage Loan to the extent available at commercially reasonable rates and in
the case of each of (A), (B), and (C) from a Qualified Insurer. In the case of
any insurance otherwise required to be maintained pursuant to this section
that is not being so maintained because the Servicer or the Special Servicer,
as applicable, has deemed that it is not available at commercially reasonable
rates, the Servicer or the Special Servicer, as applicable, shall deliver an
Officer's Certificate to the Trustee detailing the steps that the Servicer or
the Special Servicer, as applicable, took in seeking such insurance and the
factors which led to its determination that such insurance is not so
available. Any amounts collected by the Servicer or the Special
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Servicer, as applicable, under any such policies (other than amounts to be
applied to the restoration or repair of the related Mortgaged Property or
amounts to be released to the Borrower in accordance with the terms of the
related Mortgage) shall be deposited into the Collection Account pursuant to
Section 3.5, subject to withdrawal pursuant to Section 3.6. Any cost incurred
by the Servicer in maintaining any such insurance shall not, for the purpose
of calculating distributions to Certificateholders, be added to the unpaid
principal balance of the related Mortgage Loan, notwithstanding that the terms
of such Mortgage Loan so permit. It is understood and agreed that no
earthquake or other additional insurance other than flood insurance is to be
required of any Borrower or to be maintained by the Servicer other than
pursuant to the terms of the related Mortgage Loan Documents and pursuant to
such applicable laws and regulations as shall at any time be in force and as
shall require such additional insurance; provided, however, that each of the
Servicer and the Special Servicer may maintain earthquake insurance. If the
Mortgaged Property is located in a federally designated special flood hazard
area, the Servicer will use its best efforts in accordance with the Servicing
Standard to cause the related Borrower to maintain or will itself obtain
(subject to the provisions of this Agreement concerning Nonrecoverable
Advances) flood insurance in respect thereof to the extent available at
commercially reasonable rates. Such flood insurance shall be in an amount
equal to the lesser of (i) the unpaid principal balance of the related
Mortgage Loan and (ii) the maximum amount of such insurance required by the
terms of the related Mortgage and as is available for the related property
under the national flood insurance program (assuming that the area in which
such property is located is participating in such program). If an REO Property
is located in a federally designated special flood hazard area, the Special
Servicer will obtain (subject to the provisions of this Agreement concerning
Nonrecoverable Advances) flood insurance in respect thereof providing
substantially the same coverage as described in the preceding sentences. If at
any time during the term of this Agreement a recovery under a flood or fire
and hazard insurance policy in respect of an REO Property is not available but
would have been available if such insurance were maintained thereon in
accordance with the standards applied to Mortgaged Properties described
herein, the Special Servicer shall (subject to the provisions of this
Agreement concerning Nonrecoverable Advances) either (i) immediately deposit
into the Collection Account from its own funds the amount that would have been
recovered or (ii) apply to the restoration and repair of the property from its
own funds the amount that would have been recovered, if such application would
be consistent with the servicing standard set forth in Section 3.1(a);
provided, however, that the Special Servicer shall not be responsible for any
shortfall in insurance proceeds resulting from an insurer's refusal or
inability to pay a claim. Costs to the Servicer of maintaining insurance
policies pursuant to this Section 3.8 shall be paid by the Servicer as a
Property Advance and shall be reimbursable to the Servicer with interest at
the Advance Rate, which reimbursement may be effected under Section 3.6(vi);
and costs to the Special Servicer of maintaining insurance policies pursuant
to this Section 3.8 shall be paid and reimbursed in accordance with Section
3.17(b).
The Servicer and the Special Servicer agree to prepare and
present, on behalf of itself, the Trustee and the Certificateholders, claims
under each related insurance policy maintained pursuant to this Section 3.8(a)
in a timely fashion in accordance with the terms of such policy and to take
such reasonable steps as are necessary to receive payment or to permit
recovery thereunder.
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The Servicer (or with respect to any REO Property, the
Special Servicer) shall require that all insurance policies required hereunder
shall name the Trustee or the Servicer (or with respect to any REO Property,
the Special Servicer), on behalf of the Trustee as the mortgagee, as loss
payee and that all such insurance policies require that ___ days' notice be
given to the Servicer before termination to the extent required by the related
Mortgage Loan Documents.
(b) (I) If the Servicer or Special Servicer, as applicable,
obtains and maintains a blanket insurance policy with a Qualified Insurer at
its own expense insuring against fire and hazard losses, ___-month rent
interruptions or other required insurance on all of the Mortgage Loans, it
shall conclusively be deemed to have satisfied its obligations concerning the
maintenance of such insurance coverage set forth in Section 3.8(a), it being
understood and agreed that such policy may contain a deductible clause, in
which case the Servicer or Special Servicer, as applicable, shall, in the
event that (i) there shall not have been maintained on one or more of the
related Mortgaged Properties a policy otherwise complying with the provisions
of Section 3.8(a), and (ii) there shall have been one or more losses which
would have been covered by such a policy had it been maintained, immediately
deposit into the Collection Account from its own funds the amount not
otherwise payable under the blanket policy because of such deductible clause
to the extent that any such deductible exceeds the deductible limitation that
pertained to the related Mortgage Loan, or, in the absence of such deductible
limitation, the deductible limitation which is consistent with the Servicing
Standard. In connection with its activities as Servicer or Special Servicer
hereunder, as applicable, the Servicer and the Special Servicer each agrees to
prepare and present, on behalf of itself, the Trustee and Certificateholders,
claims under any such blanket policy which it maintains in a timely fashion in
accordance with the terms of such policy and to take such reasonable steps as
are necessary to receive payment or permit recovery thereunder.
(II) If the Servicer or the Special Servicer, as applicable,
causes any Mortgaged Property or REO Property to be covered by a master force
placed insurance policy, which policy is issued by a Qualified Insurer and
provides no less coverage in scope and amount for such Mortgaged Property or
REO Property than the insurance required to be maintained pursuant to Section
3.8(a), the Servicer or Special Servicer shall conclusively be deemed to have
satisfied its obligations to maintain insurance pursuant to Section 3.8(a).
Such policy may contain a deductible clause, in which case the Servicer or
Special Servicer, as applicable, shall, in the event that (i) there shall not
have been maintained on the related Mortgaged Property or REO Property a
policy otherwise complying with the provisions of Section 3.8(a), and (ii)
there shall have been one or more losses which would have been covered by such
a policy had it been maintained, immediately deposit into the Collection
Account from its own funds the amount not otherwise payable under such policy
because of such deductible to the extent that any such deductible exceeds the
deductible limitation that pertained to the related Mortgage Loan, or, in the
absence of any such deductible limitation, the deductible limitation which is
consistent with the Servicing Standard.
(c) Each of the Servicer and the Special Servicer shall
maintain a fidelity bond in the form and amount that would meet the servicing
requirements of prudent institutional commercial mortgage loan servicers. The
Servicer or the Special Servicer, as applicable, shall
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be deemed to have complied with this provision if one of its respective
Affiliates has such fidelity bond coverage and, by the terms of such fidelity
bond, the coverage afforded thereunder extends to the Servicer or the Special
Servicer, as applicable. In addition, each of the Servicer and the Special
Servicer shall keep in force during the term of this Agreement a policy or
policies of insurance covering loss occasioned by the errors and omissions of
its officers and employees in connection with its obligations to service the
Mortgage Loans hereunder in the form and amount that would meet the servicing
requirements of prudent institutional commercial mortgage loan servicers. Each
of the Servicer and the Special Servicer shall cause each and every
sub-servicer for it to maintain, or cause to be maintained by any agent or
contractor servicing any Mortgage Loan on behalf of such subservicer, a
fidelity bond and an errors and omissions insurance policy which satisfy the
requirements for the fidelity bond and the errors and omissions policy to be
maintained by the Servicer or the Special Servicer pursuant to this Section
3.8(c). All fidelity bonds and policies of errors and omissions insurance
obtained under this Section 3.8(c) shall be issued by a Qualified Insurer.
SECTION 3.9. Enforcement of Due-On-Sale Clauses; Assumption
Agreements.
(a) If any Mortgage Loan contains a provision in the nature
of a "due-on-sale" clause, which, by its terms:
(i) provides that such Mortgage Loan shall (or may at
the related mortgagee's option) become due and
payable upon the sale or other transfer of an
interest in the related Mortgaged Property, or
(ii) provides that such Mortgage Loan may not be assumed
without the consent of the related mortgagee in
connection with any such sale or other transfer,
then, for so long as such Mortgage Loan is included in the Trust Fund, the
Servicer or the Special Servicer, as applicable, on behalf of the Trust Fund,
shall enforce such provision to the extent permitted under the terms of such
Mortgage Loan, applicable law and governmental regulations, unless such
provision is not enforceable under applicable law or enforcement thereof would
result in a loss of insurance coverage under any related insurance policy or
such enforcement is reasonably likely to result in meritorious legal action by
the related Borrower or except to the extent that the Servicer or the Special
Servicer, as applicable, acting in accordance with the Servicing Standard,
determines that such enforcement would not be in the best interests of the
Trust Fund. Subject to the foregoing, the Servicer or the Special Servicer, as
applicable, is authorized to take or enter into an assumption agreement from
or with the Person to whom such Mortgaged Property has been or is about to be
conveyed, or to release the original related Borrower from liability upon such
Mortgage Loan and substitute the new Borrower as obligor thereon. To the
extent permitted by law, the Servicer or the Special Servicer, as applicable,
shall enter into an assumption or substitution agreement only if the credit
status of the prospective new Borrower is in compliance with the Servicer's or
the Special Servicer's, as applicable, regular commercial mortgage origination
or servicing standards and criteria and the terms of the related Mortgage. The
Servicer or the Special Servicer, as applicable, shall notify
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the Trustee that any such assumption or substitution agreement has been
completed by forwarding to the Trustee the original of such agreement, which
document shall be added to the related Mortgage File and shall, for all
purposes, be considered a part of such Mortgage File to the same extent as all
other documents and instruments constituting a part thereof. In connection
with any such assumption or substitution agreement, the Mortgage Rate,
principal amount and other material payment terms (including any
cross-collateralization and cross-default provisions) of such Mortgage Loan
pursuant to the related Note and Mortgage shall not be changed, other than in
connection with a default or reasonably foreseeable default with respect to
the Mortgage Loan. Assumption Fees collected by the Servicer or the Special
Servicer, as applicable, for entering into an assumption or substitution
agreement will be retained by the Servicer or the Special Servicer, as
applicable, as additional servicing compensation. Notwithstanding the
foregoing, the Servicer or Special Servicer may consent to the assumption of a
Mortgage Loan by a prospective new Borrower in a bankruptcy proceeding
involving the related Mortgaged Property.
(b) If any Mortgage Loan contains a provision in the nature
of a "due-on-encumbrance" clause, which, by its terms:
(i) provides that such Mortgage Loan shall (or may at
the related mortgagee's option) become due and
payable upon the creation of any lien or other
encumbrance on such Mortgaged Property, or
(ii) requires the consent of the related mortgagee to
the creation of any such lien or other encumbrance
on such Mortgaged Property,
then, for so long as such Mortgage Loan is included in the Trust Fund, the
Servicer or the Special Servicer, as applicable, on behalf of the Trust Fund,
shall enforce such provision and in connection therewith shall (x) accelerate
the payments due on such Mortgage Loan, or (y) withhold its consent to the
creation of any such lien or other encumbrance, as applicable, except, in each
case, to the extent that the Servicer or the Special Servicer, as applicable,
acting in accordance with the Servicing Standard, determines that such
enforcement would not be in the best interests of the Trust Fund and receives
written confirmation from ____________ that forbearance to enforce such
provision shall not result, in and of itself, in a downgrading, withdrawal or
qualification of the rating then assigned by to any Class of Certificates.
Notwithstanding the foregoing, the Servicer or the Special Servicer, as
applicable, may forbear from enforcing any due-on-encumbrance provision in
connection with any junior or senior lien on the Mortgaged Property imposed in
connection with any bankruptcy proceeding involving the Mortgaged Property.
(c) Nothing in this Section 3.9 shall constitute a waiver of
the Trustee's right, as the mortgagee of record, to receive notice of any
assumption of a Mortgage Loan, any sale or other transfer of the related
Mortgaged Property or the creation of any lien or other encumbrance with
respect to such Mortgaged Property.
(d) In connection with the taking of, or the failure to
take, any action pursuant to this Section 3.9, the Servicer or the Special
Servicer, as applicable, shall not agree to modify,
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waive or amend, and no assumption or substitution agreement entered into
pursuant to Section 3.9(a) shall contain any terms that are different from,
any term of any Mortgage Loan or the related Note or Mortgage.
SECTION 3.10. Realization Upon Mortgage Loans.
(a) With respect to any Specially Serviced Mortgage Loan,
the Special Servicer shall determine, in accordance with the Servicing
Standard, whether to grant a modification, waiver or amendment of the terms of
such Specially Serviced Mortgage Loan, commence foreclosure proceedings or
attempt to sell such Specially Serviced Mortgage Loan with reference to which
course of action is reasonably likely to produce a greater recovery on a
present value basis with respect to such Specially Serviced Mortgage Loan.
Contemporaneously with the earliest of (i) the effective date of any
modification, amendment, waiver or consent to a change of the stated maturity,
Mortgage Rate, principal balance or amortization terms of any Specially
Serviced Mortgage Loan, or any other term of a Mortgage Loan to the extent
such modification, amendment, waiver or consent would constitute a
"significant" modification under Section 1001 of the Code, including proposed
Treasury regulations thereunder, as to which Mortgage Loan a default has
occurred or is reasonably foreseeable, (ii) ___ days after the occurrence of
any uncured payment delinquency, (iii) the date ____ days after a receiver is
appointed in respect of a Mortgaged Property, or (iv) the date a Mortgaged
Property becomes an REO Property, the Special Servicer shall obtain an
appraisal of the Mortgaged Property securing any Mortgage Loan referred to in
clause (i) or (ii) or such Mortgaged Property or REO Property, as the case may
be, from an independent appraiser who is a member of the American Institute of
Real Estate Appraisers (an "Updated Appraisal"), which appraisal shall be
conducted in accordance with MAI standards.
Following a default by a Borrower in the payment of a
Balloon Payment, the Special Servicer may grant successive extensions of up to
___ months each of the related Specially Serviced Mortgage Loan; provided that
the Special Servicer shall not grant any such successive extension if, during
the previous ___-month period (or the period since the beginning of the first
such extension, if shorter), such Borrower was __ days or more delinquent in
the payment of any principal or interest required to be paid in any month; and
provided further that if any extension is requested after the third successive
extension has been granted, such further extension shall only be granted with
the consent of the Extension Advisor in accordance with Section 3.26. The
Special Servicer shall consider, among all relevant factors, any appraisal
obtained in accordance with the preceding paragraph in determining whether to
grant any such extension. The Special Servicer shall not grant any extension
that permits such Borrower to make payments of interest only for a period, in
the aggregate, of greater than ___ months.
(b) In connection with any foreclosure or other acquisition,
the Servicer shall, at the direction of the Special Servicer, pay the costs
and expenses in any such proceedings as an Advance unless the Servicer
determines, in its good faith judgment, that such Advance would constitute a
Nonrecoverable Advance. The Servicer shall be entitled to reimbursement of
Advances (with interest at the Advance Rate) made pursuant to the preceding
sentence to the extent permitted by Section 3.6(ii) (or Section 3.6(iii), in
the case of interest at the Advance Rate).
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If the Special Servicer elects to proceed with a
non-judicial foreclosure in accordance with the laws of the state where the
related Mortgaged Property is located, the Special Servicer shall not be
required to pursue a deficiency judgment against the related Borrower or any
other liable party if the laws of such state do not permit such a deficiency
judgment after a non-judicial foreclosure or if the Special Servicer
determines, in its best judgment, that the likely recovery if a deficiency
judgment is obtained will not be sufficient to warrant the cost, time, expense
and/or exposure of pursuing such a deficiency judgment and such determination
is evidenced by an Officer's Certificate delivered to the Trustee.
In the event that title to any Mortgaged Property is
acquired in foreclosure or by deed in lieu of foreclosure, the deed or
certificate of sale shall be issued to the Trustee, or to its nominee (which
shall not include the Servicer) or a separate trustee or co-trustee on behalf
of the Trustee as holder of the Lower-Tier Regular Interests and
Certificateholders. Notwithstanding any such acquisition of title and
cancellation of the related Mortgage Loan, such Mortgage Loan shall (except
for purposes of Section 9.1) be considered to be a Mortgage Loan held in the
Trust Fund until such time as the related REO Property shall be sold by the
Trust Fund and the Scheduled Principal Balance of each REO Mortgage Loan shall
be reduced by any Net REO Proceeds allocated to principal. Consistent with the
foregoing, for purposes of all calculations hereunder, so long as such
Mortgage Loan shall be considered to be an outstanding Mortgage Loan:
(i) it shall be assumed that, notwithstanding that the
indebtedness evidenced by the related Note shall
have been discharged, such Note and, for purposes
of determining the Scheduled Principal Balance
thereof, the related amortization schedule in
effect at the time of any such acquisition of
title, remain in effect; and
(ii) Net REO Proceeds received in any month shall be
applied to amounts that would have been payable
under the related Note in accordance with the terms
of such Note. In the absence of such terms, Net REO
Proceeds shall be deemed to have been received
first in payment of the accrued interest that
remained unpaid on the date that the related REO
Property was acquired by the Trust Fund; in
respect of the delinquent principal installments
that remained unpaid on such date; and thereafter,
Net REO Proceeds received in any month shall be
applied to the payment of installments of principal
and accrued interest on such Mortgage Loan deemed
to be due and payable in accordance with the terms
of such Note and such amortization schedule. If
such Net REO Proceeds exceed the Monthly Payment
then payable, the excess shall be treated as a
Principal Prepayment received in respect of such
Mortgage Loan.
(c) Notwithstanding any provision to the contrary, the
Special Servicer shall not acquire for the benefit of the Trust Fund any
personal property pursuant to this Section 3.10 unless either:
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(i) such personal property is incident to real property
(within the meaning of Section 856(e)(1) of the
Code) so acquired by the Special Servicer for the
benefit of the Trust Fund; or
(ii) the Special Servicer shall have requested and
received an Opinion of Counsel (which opinion shall
be an expense of the Trust Fund) to the effect that
the holding of such personal property by the
Lower-Tier REMIC will not cause the imposition of a
tax on the Lower-Tier REMIC or the Upper-Tier REMIC
under the REMIC Provisions or
cause the Lower-Tier REMIC or the Upper-Tier REMIC
to fail to qualify as a REMIC at any time that any
Certificate is outstanding.
(d) Notwithstanding any provision to the contrary in this
Agreement, the Special Servicer shall not, on behalf of the Trust Fund, obtain
title to any direct or indirect partnership interest or other equity interest
in any Borrower pledged pursuant to any pledge agreement unless the Special
Servicer shall have requested and received an Opinion of Counsel (which
opinion shall be an expense of the Trust Fund) to the effect that the holding
of such partnership or other equity interest by the Trust Fund will not cause
the imposition of a tax on the Lower-Tier REMIC or the Upper-Tier REMIC under
the REMIC Provisions or cause the Lower-Tier REMIC or the Upper-Tier REMIC to
fail to qualify as a REMIC at any time that any Certificate is outstanding.
(e) Notwithstanding any provision to the contrary contained
in this Agreement, the Special Servicer shall not, on behalf of the Trust
Fund, obtain title to a Mortgaged Property as a result of or in lieu of
foreclosure or otherwise obtain title to any direct or indirect partnership
interest or other equity interest in any Borrower pledged pursuant to a pledge
agreement and thereby be the beneficial owner of a Mortgaged Property, and
shall not otherwise acquire possession of, or take any other action with
respect to, any Mortgaged Property if, as a result of any such action, the
Trustee, for the Trust Fund or the Certificateholders, would be considered to
hold title to, to be a "mortgagee-in-possession" of, or to be an "owner" or
"operator" of such Mortgaged Property within the meaning of the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended
from time to time, or any comparable law, unless the Special Servicer has
previously determined in accordance with the Servicing Standard, based on an
updated environmental assessment report prepared by an Independent Person who
regularly conducts environmental audits, that:
(A) such Mortgaged Property is in compliance with
applicable environmental laws or, if not after consultation with an
environmental consultant, that it would be in the best economic
interest of the Trust Fund to take such actions as are necessary to
bring such Mortgaged Property in compliance therewith, and
(B) there are no circumstances present at such
Mortgaged Property relating to the use, management or disposal of any
Hazardous Materials for which investigation, testing, monitoring,
containment, clean-up or remediation could be required under any
currently effective federal, state or local law or regulation, or
that, if any such Hazardous Materials are present for which such
action could be required, after
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consultation with an environmental consultant, it would be in the
best economic interest of the Trust Fund to take such actions with
respect to such Mortgaged Property.
In the event that the environmental assessment list obtained
by the Special Servicer with respect to a Mortgaged Property indicates that
such Mortgaged Property may not be in compliance with applicable environmental
laws or that Hazardous Materials may be present but does not definitively
establish such fact, the Special Servicer shall cause such further
environmental tests as the Special Servicer shall deem prudent to protect the
interests of Certificateholders to be conducted by an Independent Person who
regularly conducts such tests. Any such tests shall be deemed part of the
environmental assessment obtained by the Special Servicer for purposes of this
Section 3.10.
(f) The environmental assessment contemplated by Section
3.10(f) shall be prepared by any Independent Person who regularly conducts
environmental audits for purchasers of commercial properties located in the
same general area as the Mortgaged Property with respect to which the Special
Servicer is ordering such environmental assessment, as determined by the
Special Servicer in a manner consistent with the Servicing Standard. The
Servicer shall at the direction of the Special Servicer advance the cost of
preparation of such environmental assessments unless the Servicer determines,
in its good faith judgment, that such Advance would be a Nonrecoverable
Advance. The Servicer shall be entitled to reimbursement of Advances (with
interest at the Advance Rate) made pursuant to the preceding sentence to the
extent permitted pursuant to Section 3.6.
(g) If the Special Servicer determines pursuant to Section
3.10(f)(A) that a Mortgaged Property is not in compliance with applicable
environmental laws but that it is in the best economic interest of the Trust
Fund to take such actions as are necessary to bring such Mortgaged Property
into compliance therewith, or if the Special Servicer determines pursuant to
Section 3.10(f)(B) that the circumstances referred to therein relating to
Hazardous Materials are present but that it is in the best economic interest
of the Trust Fund to take such action with respect to the containment,
clean-up or remediation of Hazardous Materials affecting such Mortgaged
Property as is required by law or regulation, the Special Servicer shall take
such action as it deems to be in the best economic interest of the Trust Fund
(with due consideration to the avoidance of "mortgagee-in-possession," "owner"
or "operator" status, as set forth in Section 3.10(f)), but only if the
Trustee has mailed notice to the Holders of the Regular Certificates of such
proposed action, which notice shall be prepared by the Special Servicer, and
only if the Trustee does not receive, within __ days of such notification,
instructions from the Holders of at least __% of the aggregate Voting Rights
of such Classes directing the Special Servicer not to take such action. None
of the Trustee, the Servicer or the Special Servicer shall be obligated to
take any action or not take any action pursuant to this Section 3.10(h) at the
direction of the Certificateholders unless the Certificateholders agree to
indemnify the Trustee, the Servicer and the Special Servicer with respect to
such action or inaction. None of the Special Servicer, Servicer or the Trustee
shall be required to advance the cost of any such compliance, containment,
clean-up or remediation and such expense shall be an expense of the Trust
Fund.
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(h) The Special Servicer shall report to the IRS and to the
related Borrower, in the manner required by applicable law, the information
required to be reported regarding any Mortgaged Property which is abandoned or
foreclosed. The Special Servicer shall deliver a copy of any such report to
the Trustee.
(i) The costs of any appraisal obtained pursuant to this
Section 3.10 shall be paid by the Servicer as an Advance and shall be
reimbursable (with interest thereon at the Advance Rate) from the Collection
Account.
SECTION 3.11. Trustee to Cooperate; Release of Mortgage
Files.
Upon the payment in full of any Mortgage Loan, or the
receipt by the Servicer of a notification that payment in full has been
escrowed in a manner customary for such purposes, the Servicer shall
immediately notify the Trustee and the Custodian by a certification (which
certification shall include a statement to the effect that all amounts
received or to be received in connection with such payment which are required
to be deposited in the Collection Account pursuant to Section 3.5(a) have been
or will be so deposited) of a Servicing Officer and shall request delivery to
it of the Mortgage File. No expenses incurred in connection with any
instrument of satisfaction or deed of reconveyance shall be chargeable to the
Trust Fund.
From time to time upon request of the Servicer or the
Special Servicer, and delivery to the Trustee and the Custodian of a Request
for Release, the Trustee shall promptly cause the Custodian to release the
Mortgage File (or any portion thereof) designated in such Request for Release
to the Servicer or the Special Servicer, as applicable. Upon receipt of (a)
such Mortgage File (or portion thereof) by the Custodian from the Servicer or
the Special Servicer, as applicable, or (b) in the event of a liquidation or
conversion of the related Mortgage Loan into an REO Property, a certificate of
a Servicing Officer stating that such Mortgage Loan was liquidated and that
all amounts received or to be received in connection with such liquidation
which are required to be deposited into the Collection Account or Distribution
Account have been so deposited, or that such Mortgage Loan has become an REO
Property, the Custodian shall return the Request for Release to the Servicer
or the Special Servicer, as applicable.
Upon written certification of a Servicing Officer, the
Trustee shall execute and deliver to the Special Servicer any court pleadings,
requests for trustee's sale or other documents prepared by the Special
Servicer, its agents or attorneys, necessary to the foreclosure or trustee's
sale in respect of the Mortgaged Property or to any legal action brought to
obtain judgment against any Borrower on the related Note or Mortgage or to
obtain a deficiency judgment, or to enforce any other remedies or rights
provided by such Note or Mortgage or otherwise available at law or in equity.
Each such certification shall include a request that such pleadings or
documents be executed by the Trustee and a statement as to the reason such
documents or pleadings are required and that the execution and delivery
thereof by the Trustee will not invalidate or otherwise affect the lien of the
related Mortgage, except for the termination of such a lien upon completion of
the foreclosure or trustee's sale.
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SECTION 3.12. Servicing Compensation and Trustee Fees.
(a) As compensation for its activities hereunder, the
Servicer shall be entitled to the Servicing Fee, which shall be payable solely
from receipts on the related Mortgage Loans, and may be withheld from payments
on account of interest prior to deposit in the Collection Account, or may be
withdrawn from amounts on deposit in the Collection Account as set forth in
Section 3.6(iv). The Servicer's rights to the Servicing Fee may not be
transferred in whole or in part except in connection with the transfer of all
of the Servicer's responsibilities and obligations under this Agreement. In
addition, the Servicer shall be entitled to receive, as additional servicing
compensation, any Prepayment Interest Surplus (subject to Section 3.25) and,
to the extent permitted by applicable law and the related Notes and Mortgages,
any late payment charges, late fees, Assumption Fees, loan modification fees,
extension fees, Financial and Lease Reporting Fees (to the extent such fees
are not required to be remitted to the related Borrower pursuant to the
related Note), loan service transaction fees, beneficiary statement charges,
or similar items (but not including any Default Interest or Prepayment
Premiums), in each case to the extent received, with respect to any Mortgage
Loan that is not a Specially Serviced Mortgage Loan and not required to be
deposited or retained in the Collection Account pursuant to Section 3.5. The
Servicer shall also be entitled pursuant to, and to the extent provided in,
Section 3.7(b) to withdraw from the Collection Account and to receive from the
Reserve Accounts (to the extent not required to be paid to the related
Borrower pursuant to the related Mortgage Loan Documents or applicable law)
any interest or other income earned on deposits therein.
As compensation for its activities hereunder, the Trustee
shall be entitled to the Trustee Fee with respect to each Mortgage Loan, which
shall be paid by the Servicer from its own funds without reimbursement
therefor. The Trustee shall pay the routine fees and expenses of the
Certificate Registrar, the Paying Agent, the Custodian and the Authenticating
Agent. The Trustee's rights to the Trustee Fee may not be transferred in whole
or in part except in connection with the transfer of all of the Trustee's
responsibilities and obligations under this Agreement.
Except as otherwise provided herein, the Servicer shall pay
all expenses incurred by it in connection with its servicing activities
hereunder and the Trustee shall pay all expenses incurred by it in connection
with its activities hereunder.
(b) As compensation for its activities hereunder, the
Special Servicer shall be entitled to the Special Servicing Fee with respect
to each Specially Serviced Mortgage Loan, which shall be payable from amounts
on deposit in the Collection Account as set forth in Section 3.6(iv). The
Special Servicer's rights to the Special Servicing Fee may not be transferred
in whole or in part except in connection with the transfer of all of the
Special Servicer's responsibilities and obligations under this Agreement. The
Special Servicer shall also be entitled pursuant to, and to the extent
provided in, Section 3.7(b) to withdraw from any REO Account any interest or
other income earned on deposits therein.
In addition, the Special Servicer shall be entitled to
receive, as additional Servicing Compensation, to the extent permitted by
applicable law and the related Notes and
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Mortgages, any late payment charges, late fees, Assumption Fees, loan
modification fees, extension fees, Financial and Lease Reporting Fees (to the
extent such fees are not required to be remitted to the related Borrower
pursuant to the related Note), loan service transaction fees, beneficiary
statement charges, or similar items (but not including any Default Interest or
Prepayment Premiums), in each case to the extent received with respect to any
Specially Serviced Mortgage Loan and not required to be deposited or retained
in the Collection Account pursuant to Section 3.5.
Except as otherwise provided herein, the Special Servicer
shall pay all expenses incurred by it in connection with its servicing
activities hereunder.
(c) In addition to other Special Servicer compensation
provided for in this Agreement, and not in lieu thereof, the Special Servicer
shall be entitled to the Disposition Fee payable out of the Liquidation
Proceeds prior to the deposit of the related Net Liquidation Proceeds in the
Collection Account.
(d) The Servicer, the Special Servicer and the Trustee shall
be entitled to reimbursement from the Trust Fund for the unanticipated costs
and expenses incurred by them in the performance of their duties under this
Agreement which are "unanticipated expenses incurred by the REMIC" within the
meaning of Treasury Regulations Section 1.860G-1(b)(3)(ii). Such expenses
shall include, by way of example and not by way of limitation, environmental
assessments, appraisals in connection with foreclosure, the fees and expenses
of any administrative or judicial proceeding and expenses expressly identified
as reimbursable in Section 3.6(vi).
(e) No provision of this Agreement or of the Certificates
shall require the Servicer, the Special Servicer, the Trustee or the Fiscal
Agent to expend or risk their own funds or otherwise incur any financial
liability in the performance of any of their duties hereunder or thereunder,
or in the exercise of any of their rights or powers, if, in the good faith
business judgment of the Servicer, Special Servicer, Trustee or the Fiscal
Agent, as the case may be, repayment of such funds would not be ultimately
recoverable from late payments, Insurance Proceeds, Condemnation Proceeds, Net
Liquidation Proceeds and other collections on or in respect of the Mortgage
Loans, or from adequate indemnity from other assets comprising the Trust Fund
against such risk or liability.
If the Servicer, the Special Servicer or the Trustee
receives a request or inquiry from a Borrower, any Certificateholder or any
other Person the response to which would, in the Servicer's, the Special
Servicer's or the Trustee's good faith business judgment, require the
assistance of Independent legal counsel or other consultant to the Servicer,
the Special Servicer or the Trustee, the cost of which would not be an expense
of the Trust Fund hereunder, then the Servicer, the Special Servicer or the
Trustee, as the case may be, shall not be required to take any action in
response to such request or inquiry unless such Borrower or such
Certificateholder or such other Person, as applicable, makes arrangements for
the payment of the Servicer's, the Special Servicer's or Trustee's expenses
associated with such counsel or other consultant (including, without
limitation, posting an advance payment for such expenses) satisfactory to the
Servicer, the Special Servicer or the Trustee, as the case may be, in its sole
discretion. Unless
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such arrangements have been made, the Servicer, the Special Servicer or the
Trustee, as the case may be, shall have no liability to any Person for the
failure to respond to such request or inquiry.
SECTION 3.13. Reports to the Trustee; Collection
Account Statements.
(a) The Servicer shall deliver to the Paying Agent, with a
copy to the Trustee, the Fiscal Agent and each Rating Agency, no later than
the ____ Business Day following each Determination Date, but in any event no
later than the ______ Business Day prior to the related Distribution Date, (i)
the Servicer Remittance Report with respect to such Determination Date (which
shall include, without limitation, the amount of Pooled Available Funds for
the related Distribution Date) and (ii) a written statement of required P&I
Advances for the related Determination Date together with the certificate and
documentation required by the definition of Nonrecoverable Advance related to
any determination that any such P&I Advance would constitute a Nonrecoverable
Advance made as of such Determination Date.
(b) For so long as the Servicer makes deposits into and
withdrawals from the Collection Account, not later than ______ days after each
Distribution Date, the Servicer shall forward to the Trustee a statement
prepared by the Servicer setting forth the status of the Collection Account as
of the close of business on the ____ Business Day of the related Collection
Period showing the aggregate amount of deposits into and withdrawals from the
Collection Account for each category of deposit specified in Section 3.5 and
each category of withdrawal specified in Section 3.6 for such Collection
Period. The Trustee and its agents and attorneys may at any time during normal
business hours, upon reasonable notice, inspect and copy the books, records
and accounts of the Servicer with respect to the Mortgage Loans and the
performance of its duties hereunder.
(c) The Trustee shall be entitled to rely conclusively on
and shall not be responsible for the content or accuracy of any information
provided to it by the Servicer or the Special Servicer pursuant to this
Agreement.
SECTION 3.14. Annual Statement as to Compliance.
The Servicer and the Special Servicer shall deliver to the
Trustee and to the Depositor on or before March 31 of each year, beginning
_________ with , an Officer's Certificate stating, as to each signatory
thereof, (i) that a review of the activities of the Servicer or the Special
Servicer, as applicable, during the preceding calendar year (or such shorter
period from the Closing Date to the end of the related calendar year) and of
its performance under this Agreement has been made under such officer's
supervision, (ii) that, to the best of such officer's knowledge, based on such
review, it has fulfilled all of its obligations under this Agreement
throughout such year (or such shorter period), or, if there has been a default
in the fulfillment of any such obligation, specifying each such default known
to such officer, the nature and status thereof and what action it proposes to
take with respect thereto, (iii) that, to the best of such officer's
knowledge, each sub-servicer has fulfilled its obligations under its
sub-servicing agreement in all material respects, or, if there has been a
material default in the fulfillment of such obligations, specifying each such
default known to such officer and the nature and status
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thereof, and (iv) whether it has received any notice regarding qualification,
or challenging the status, of the Upper-Tier REMIC or Lower-Tier REMIC as a
REMIC from the IRS or any other governmental agency or body.
SECTION 3.15. Annual Independent Public Accountants'
Servicing Report.
On or before March 31 of each year, beginning with _________
, the Servicer and the Special Servicer at its expense shall cause a firm of
nationally recognized Independent public accountants (who may also render
other services to the Servicer or the Special Servicer, as applicable) which
is a member of the American Institute of Certified Public Accountants to
furnish a statement to the Trustee and to the Depositor, to the effect that
such firm has examined certain documents and records relating to the servicing
of the Mortgage Loans under this Agreement and that, on the basis of such
examination conducted substantially in compliance with generally accepted
auditing standards and the Uniform Single Attestation Program for Mortgage
Bankers or the Audit Program for Mortgages serviced for FHLMC, such servicing
has been conducted in compliance with this Agreement except for such
significant exceptions or errors in records that, in the opinion of such firm,
generally accepted auditing standards and the Uniform Single Attestation
Program for Mortgage Bankers or the Audit Program for Mortgages serviced for
FHLMC require it to report, in which case such exceptions and errors shall be
so reported.
SECTION 3.16. Access to Certain Documentation.
(a) The Servicer and the Special Servicer shall provide to
any Certificateholders that are federally insured financial institutions, the
Federal Reserve Board, the FDIC and the OTS and the supervisory agents and
examiners of such boards and such corporations, and any other governmental or
regulatory body to the jurisdiction of which any Certificateholder is subject,
access to the documentation regarding the Mortgage Loans required by
applicable regulations of the Federal Reserve Board, FDIC, OTS or any such
governmental or regulatory body, such access being afforded without charge but
only upon reasonable request and during normal business hours at the offices
of the Servicer or the Special Servicer, as applicable.
(b) In connection with the solicitation of bids to purchase
the Mortgage Loans pursuant to Section 9.1(d), the Servicer and the Special
Servicer shall provide each Qualified Offeror who has paid the non-refundable
deposit required pursuant to Section 9.1(d)(vi) with access to all documents
that the Auction Agent considers material to prospective purchasers in
connection with their evaluation of the purchase of the Mortgage Loans and
shall cooperate with the Auction Agent in order to facilitate prospective
purchasers' due diligence in accordance with the Auction Procedures, including
without limitation the provision of facilities in which copies of each
Mortgage File may be reviewed, provision of facilities for the photocopying of
documents relating to Mortgages in return for payment of expenses of such
photocopying, cooperation in arranging access to Mortgaged Properties and such
other matters as the Auction Agent may reasonably request; provided, however,
that the Servicer or the Special Servicer, as applicable, shall be entitled to
be compensated by Qualified Offerors for its costs of providing such access,
cooperation and facilities.
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(c) Nothing in this Section 3.16 shall detract from the
obligation of the Servicer or the Special Servicer to observe any applicable
law prohibiting disclosure of information with respect to the Borrowers or the
Mortgage Loans, and the failure of the Servicer or the Special Servicer, as
applicable, to provide access as provided in this Section 3.16 as a result of
such obligation shall not constitute a breach of this Section 3.16.
SECTION 3.17. Title and Management of REO Properties.
(a) In the event that title to any Mortgaged Property is
acquired for the benefit of Certificateholders in foreclosure, by deed in lieu
of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or
certificate of sale shall be taken in the name of the Trustee, or its nominee
(which shall not include the Servicer), or a separate trustee or co-trustee,
on behalf of the Trust Fund. The Special Servicer shall maintain accurate
records with respect to each related REO Property reflecting the status of
taxes, assessments and other similar items that are or may become a lien on
such REO Property and the status of insurance premiums payable with respect
thereto. The Special Servicer, on behalf of the Trust Fund, shall dispose of
any REO Property within two years after the Trust Fund acquires ownership of
such REO Property for purposes of Section 860G(a)(8) of the Code, unless (i)
the Special Servicer, on behalf of the Lower-Tier REMIC, has applied for and
received an extension of such two-year period pursuant to Sections 856(e)(3)
and 860G(a)(8)(A) of the Code, in which case the Special Servicer shall sell
such REO Property within the applicable extension period or (ii) the Special
Servicer seeks and subsequently receives an Opinion of Counsel (which opinion
shall be an expense of the Trust Fund), addressed to the Special Servicer and
the Trustee, to the effect that the holding by the Trust Fund of such REO
Property for an additional specified period will not cause such REO Property
to fail to qualify as "foreclosure property" within the meaning of Section
860G(a)(8) of the Code (determined without regard to the exception applicable
for purposes of Section 860D(a) of the Code) at any time that any Certificate
is outstanding, in which case the Special Servicer shall sell such REO
Property within such two-year period as extended by such additional specified
period subject to any conditions set forth in such Opinion of Counsel. The
Special Servicer, on behalf of the Trust Fund, shall dispose of any REO
Property held by the Trust Fund prior to the ____ day of the period (taking
into account extensions) within which such REO Property is required to be
disposed of pursuant to the provisions of the immediately preceding sentence
in a manner provided under Section 3.18 hereof. The Special Servicer shall
manage, conserve, protect and operate each REO Property for the
Certificateholders solely for the purpose of its disposition and sale in a
manner which does not cause such REO Property to fail to qualify as
"foreclosure property" within the meaning of Section 860G(a)(8) of the Code
(determined without regard to the exception applicable for purposes of Section
860D(a)).
(b) The Special Servicer shall have full power and
authority, subject only to the specific requirements and prohibitions of this
Agreement, to do any and all things in connection with any REO Property as are
consistent with the manner in which the Special Servicer manages and operates
similar property owned or managed by the Special Servicer or any of its
Affiliates, all on such terms and for such period as the Special Servicer
deems to be in the best interests of Certificateholders, and, in connection
therewith, the Special Servicer shall agree to the payment of management fees
that are consistent with general market standards. The
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Special Servicer shall segregate and hold all revenues received by it with
respect to any REO Property separate and apart from its own funds and general
assets and shall establish and maintain with respect to any REO Property a
segregated custodial account (each, an "REO Account"), each of which shall be
an Eligible Account and shall be entitled " __________ , as Trustee, in trust
for Holders of Prudential Securities Secured Financing Corporation, Commercial
Mortgage Pass-Through Certificates, Series __________ , REO Account." The
Special Servicer shall be entitled to any interest or investment income earned
on funds deposited in an REO Account to the extent provided in Section 3.7(b).
The Special Servicer shall deposit or cause to be deposited in the related REO
Account within ___ Business Day after receipt all REO Proceeds received by it
with respect to any REO Property (other than Liquidation Proceeds), and shall
withdraw therefrom funds necessary for the proper operation, management and
maintenance of such REO Property and for other Property Protection Expenses
with respect to such REO Property, including:
(i) all insurance premiums due and payable in respect
of such REO Property;
(ii) all real estate taxes and assessments in respect of
such REO Property that may result in the imposition
of a lien thereon; and
(iii) all costs and expenses reasonable and necessary to
protect, maintain, manage, operate, repair and
restore such REO Property, including any property
management fees.
To the extent that such REO Proceeds are insufficient for
the purposes set forth in clauses (i) through (iii) above, the Servicer (or,
in the event the Servicer is unable to perform, the Trustee or Fiscal Agent)
shall make an Advance equal to the amount of such shortfall unless the
Servicer determines, in its good faith judgment, that such Advance would be a
Nonrecoverable Advance. The Servicer shall be entitled to reimbursement of
such Advances (with interest at the Advance Rate) made pursuant to the
preceding sentence, to the extent permitted pursuant to Section 3.6. The
Special Servicer shall remit to the Servicer from each REO Account for deposit
in the Collection Account on a monthly basis prior to the related Remittance
Date the Net REO Proceeds received or collected from the related REO Property,
except that in determining the amount of such Net REO Proceeds, the Special
Servicer may retain in such REO Account reasonable reserves for repairs,
replacements and necessary capital improvements and other related expenses.
Notwithstanding the foregoing, the Special Servicer shall not:
(i) permit the Trust Fund to enter into, renew or
extend any New Lease if the New Lease, by its
terms, will give rise to any income that does not
constitute Rents from Real Property;
(ii) permit any amount to be received or accrued under
any New Lease other than amounts that will
constitute Rents from Real Property;
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(iii) authorize or permit any construction on any REO
Property, other than the repair or maintenance
thereof or the completion of a building or other
improvement thereon, and then only if more than ten
percent of the construction of such building or
other improvement was completed before default on
the related Mortgage Loan became imminent, all
within the meaning of Section 856(e)(4)(B) of the
Code; or
(iv) Directly Operate or perform any construction work
on, or allow any Person (other than an Independent
Contractor) to Directly Operate or perform any
construction work on, any REO Property on, any date
more than __ days after its date of acquisition by
the Trust Fund;
unless, in any such case, the Special Servicer has requested and received an
Opinion of Counsel addressed to the Special Servicer and the Trustee (which
opinion shall be an expense of the Trust Fund) to the effect that such action
will not cause such REO Property to fail to qualify as "foreclosure property"
within the meaning of Section 860G(a)(8) of the Code (determined without
regard to the exception applicable for purposes of Section 860D(a) of the
Code) at any time that it is held by the Trust Fund, in which case the Special
Servicer may take such actions as are specified in such Opinion of Counsel.
The Special Servicer shall be required to contract with an
Independent Contractor for the operation and management of any REO Property
within __ days of the Trust Fund's acquisition thereof (unless the Special
Servicer shall have provided the Trustee with an Opinion of Counsel that the
operation and management of such REO Property other than through an
Independent Contractor shall not cause such REO Property to fail to qualify as
"foreclosure property" within the meaning of Code Section 860G(a)(8)) (which
opinion shall be an expense of the Trust Fund), provided that:
(i) the terms and conditions of any such contract shall
be reasonable and customary for the area and type
of property and shall not be inconsistent herewith;
(ii) any such contract shall require, or shall be
administered to require, that the Independent
Contractor pay all costs and expenses incurred in
connection with the operation and management of
such REO Property, including those listed above,
and remit all related revenues (net of such costs
and expenses) to the Special Servicer as soon as
practicable, but in no event later than _____ days
following the receipt thereof by such Independent
Contractor;
(iii) none of the provisions of this Section 3.17(b)
relating to any such contract or to actions taken
through any such Independent Contractor shall be
deemed to relieve the Special Servicer of any of
its duties and obligations to the Trust Fund or the
Trustee on behalf of the Certificateholders with
respect to the operation and management of any such
REO Property; and
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(iv) the Special Servicer shall be obligated with
respect thereto to the same extent as if it alone
were performing all duties and obligations in
connection with the operation and management of
such REO Property.
The Special Servicer shall be entitled to enter into any
agreement with any Independent Contractor performing services for it related
to its duties and obligations hereunder for indemnification of the Special
Servicer by such Independent Contractor, and nothing in this Agreement shall
be deemed to limit or modify such indemnification.
(c) Promptly following any acquisition by the Trust Fund of
an REO Property, the Special Servicer shall obtain (i) an update of any
appraisal performed pursuant to Section 3.10 which is more than ___ months
old, or (ii) to the extent that an appraisal has not been obtained pursuant to
such Section, an appraisal of such REO Property by an Independent appraiser
familiar with the area in which such REO Property is located in order to
determine the fair market value of such REO Property and shall notify the
Depositor and the Trustee of the results of such appraisal. Any such appraisal
shall be conducted in accordance with MAI standards and the cost thereof shall
be an expense of the Trust Fund.
(d) When and as necessary, the Special Servicer shall send
to the Trustee a statement prepared by the Special Servicer setting forth the
amount of net income or net loss, as determined for federal income tax
purposes, resulting from the operation and management of a trade or business
on, the furnishing or rendering of a non-customary service to the tenants of,
or the receipt of any other amount not constituting Rents from Real Property
in respect of, any REO Property in accordance with Section 3.17(b).
SECTION 3.18. Sale of Specially Serviced Mortgage Loans
and REO Properties.
(a) With respect to any Specially Serviced Mortgage Loan or
REO Property which the Special Servicer has determined to sell in accordance
with Section 3.10 or otherwise, the Special Servicer shall deliver to the
Trustee an Officer's Certificate to the effect that the Special Servicer has
determined to sell such Specially Serviced Mortgage Loan or REO Property in
accordance with this Section 3.18. The Special Servicer may then offer to sell
to any Person such Specially Serviced Mortgage Loan or such REO Property but
shall, in any event, so offer to sell such REO Property no later than the time
determined by the Special Servicer to be sufficient to result in the sale of
such REO Property within the period specified in Section 3.17(a). The Special
Servicer shall deliver such Officer's Certificate and give the Trustee not
less than __ Business Days prior written notice of its
intention to sell such Specially Serviced Mortgage Loan or REO Property, in
which case the Special Servicer shall accept any offer received from any
Person that is determined by the Special Servicer to be a fair price, as
determined in accordance with Section 3.18(b), for such Specially Serviced
Mortgage Loan or REO Property if the offeror is a Person other than an
Interested Person, or is determined to be such a price by the Trustee if the
offeror is an Interested Person; provided, however, that the Trustee shall be
entitled to engage at the expense of the Trust Fund, an Independent appraiser
to determine whether the offer is a fair price. Notwithstanding anything to
the contrary herein,
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neither the Trustee in its individual capacity nor any of its Affiliates, may
make an offer or purchase any Specially Serviced Mortgage Loan or any REO
Property pursuant hereto.
In addition, in the event that the Special Servicer receives
more than one fair offer with respect to any Specially Serviced Mortgage Loan
or REO Property, the Special Servicer may accept an offer that is not the
highest fair offer if it determines, in accordance with the Servicing
Standard, that acceptance of such offer would be in the best interests of the
Certificateholders (for example, if the prospective buyer making the lower
offer is more likely to perform its obligations, or the terms offered by the
prospective buyer making the lower offer are more favorable). In the event
that the Special Servicer determines with respect to any REO Property that the
offers being made with respect thereto are not in the best interests of the
Certificateholders and that the end of the two-year period referred to in
Section 3.17(a) with respect to such REO Property is approaching, the Special
Servicer shall seek an extension of such two-year period in the manner
described in Section 3.17(a); provided, however, that the Special Servicer
shall use its best efforts in accordance with the Servicing Standard, to sell
any REO Property no later than the day prior to the Determination Date
immediately prior to the Scheduled Final Distribution Date.
(b) In determining whether any offer received represents a
fair price for any Specially Serviced Mortgage Loan or any REO Property, the
Special Servicer or the Trustee may conclusively rely on the opinion of an
Independent appraiser or other expert in real estate matters retained by the
Special Servicer or the Trustee at the expense of the Trust Fund. In
determining whether any offer constitutes a fair price for any Specially
Serviced Mortgage Loan or any REO Property, the Special Servicer or the
Trustee (or, if applicable, such appraiser) shall take into account, and any
appraiser or other expert in real estate matters shall be instructed to take
into account, the appraisal obtained pursuant to Section 3.10(a) and, as
applicable, among other factors, the period and amount of any delinquency on
such Specially Serviced Mortgage Loan, the physical (including environmental)
condition of the related Mortgaged Property or such REO Property, the state of
the local economy and the Trust Fund's obligation to dispose of any REO
Property within the time period specified in Section 3.17(a).
(c) Subject to the provisions of Section 3.17, the Special
Servicer shall act on behalf of the Trust Fund in negotiating and taking any
other action necessary or appropriate in connection with the sale of any
Specially Serviced Mortgage Loan or REO Property, including the collection of
all amounts payable in connection therewith. Any sale of a Specially Serviced
Mortgage Loan or any REO Property shall be without recourse to, or
representation or warranty by, the Trustee, the Depositor, the Servicer, the
Special Servicer or the Trust Fund (except that any contract of sale and
assignment and conveyance documents may contain customary warranties of title,
so long as the only recourse for breach thereof is to the Trust Fund), and, if
such sale is consummated in accordance with the duties of the Special
Servicer, the Servicer, the Depositor and the Trustee pursuant to the terms of
this Agreement, no such Person who so performed shall have any liability to
the Trust Fund or any Certificateholder with respect to the purchase price
therefor accepted by the Special Servicer or the Trustee.
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(d) Net Liquidation Proceeds related to any such sale shall
be promptly, and in any event within ___ Business Day following receipt
thereof, deposited in the Collection Account in accordance with Section
3.5(a)(iv).
SECTION 3.19. Inspections.
The Servicer (or, with respect to Specially Serviced
Mortgage Loans and REO Properties, the Special Servicer) shall inspect or
cause to be inspected (at its own expense) each Mortgaged Property at such
times and in such manner as are consistent with the Servicing Standard, but in
any event (i) ____________ inspect each Mortgaged Property at least once every
___ months commencing in unless each of the Rating Agencies has confirmed in
writing that a longer period between inspections shall not result, in and of
itself, in a downgrading, withdrawal or qualification of the rating then
assigned by such Rating Agency to any Class of the Certificates; (ii) if the
Servicer or the Special Servicer retains any Financial and Lease Reporting
Fees pursuant to Section 3.12, each related Mortgaged Property shall be
inspected by the Servicer or the Special Servicer, as applicable, as soon as
practicable thereafter, except to the extent such Mortgaged Property has been
inspected by the Servicer or the Special Servicer within the immediately
preceding ___ days; and (iii) if any Monthly Payment becomes more than __ days
delinquent (without giving effect to any grace period permitted under the
related Note or Mortgage), each related Mortgaged Property shall be inspected
by the Special Servicer (at its own expense) as soon as practicable
thereafter.
SECTION 3.20. Available Information and Notices.
The Servicer or the Special Servicer, if applicable, shall
promptly give notice to the Trustee, who will copy each Certificateholder,
each Rating Agency, the Depositor and the Mortgage Loan Seller of (a) any
notice from a Borrower or insurance company regarding an upcoming voluntary or
involuntary prepayment (including that resulting from a casualty or
condemnation) of all or part of the related Mortgage Loan (provided that a
request by a Borrower or other party for a quotation of the amount necessary
to satisfy all obligations with respect to a Mortgage Loan shall not, in and
of itself, be deemed to be such notice); and (b) of any other occurrence known
to it with respect to a Mortgage Loan or REO Property that the Servicer or the
Special Servicer determines, in accordance with the Servicing Standard, would
have a material effect on such Mortgage Loan or REO Property, which notice
shall include an explanation as to the reason for such material effect
(provided that any extension of the term of any Mortgage Loan shall be deemed
to have a material effect).
Neither the Servicer nor the Special Servicer shall be
responsible for the accuracy or completeness of any information supplied to it
by a Borrower or otherwise for inclusion in any such notice, and the Servicer,
the Special Servicer and the Trustee shall be indemnified and held harmless by
the Trust Fund against any loss, liability or expense incurred in connection
with any legal action relating to any statement or omission or alleged
statement or omission therein, including any liability related to the
inclusion of such information in any report filed with the Commission.
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In addition to the other reports and information made
available and distributed to the Depositor, the Trustee or the
Certificateholders pursuant to other provisions of this Agreement, the
Servicer and the Special Servicer shall, in accordance with such reasonable
rules and procedures as it may adopt (which may include the requirement that
an agreement governing the availability, use and disclosure of such
information be executed to the extent the Servicer or the Special Servicer, as
applicable, deems such action to be necessary or appropriate), also make
available any information relating to the Mortgage Loans, the Mortgaged
properties or the Borrower for review by the Depositor, the Trustee, the
Certificateholders and any other Persons to whom the Servicer or the Special
Servicer, as the case may be, believes such disclosure is appropriate, in each
case except to the extent doing so is prohibited by applicable law or by any
documents related to a Mortgage Loan.
The Trustee shall also make available at its offices
primarily responsible for administration of the Trust Fund, during normal
business hours, for review by the Depositor, any Certificateholder, any Person
identified to the Trustee by a Certificateholder as a prospective transferee
of a Certificate and any other Persons to whom the Trustee believes such
disclosure is appropriate, the following items: (i) this Agreement, (ii) all
monthly statements to Certificateholders delivered since the Closing Date
pursuant to Section 4.2(a), (iii) all annual statements as to compliance
delivered to the Trustee and the Depositor pursuant to Section 3.14 and (iv)
all annual Independent accountants' reports delivered to the Trustee and the
Depositor pursuant to Section 3.15. The Servicer or the Special Servicer, as
appropriate, shall make available at its offices during normal business hours,
for review by the Depositor, the Trustee, any Certificateholder, any Person
identified to the Servicer or the Special Servicer, as applicable, by a
Certificateholder as a prospective transferee of a Certificate and any other
Persons to whom the Servicer or the Special Servicer, as applicable, believes
such disclosure is appropriate, the following items: (i) the inspection
reports prepared by or on behalf of the Servicer or the Special Servicer, as
applicable, in connection with the property inspections conducted by the
Servicer or the Special Servicer, as applicable, pursuant to Section 3.19,
(ii) any and all modifications, waivers and amendments of the terms of a
Mortgage Loan entered into by the Servicer or the Special Servicer and (iii)
any and all Officer's Certificates and other evidence delivered to the Trustee
and the Depositor to support the Servicer's determination that any Advance
was, or if made would be, a Nonrecoverable Advance, in each case except to the
extent doing so is prohibited by applicable laws or by any documents related
to a Mortgage Loan. Copies of any and all of the foregoing items shall be
available from the Servicer, the Special Servicer or the Trustee, as
applicable, upon request. The Servicer, the Special Servicer and the Trustee
shall be permitted to require payment (other than from any Rating Agency) of
a sum sufficient to cover the reasonable costs and expenses incurred by it in
providing copies of or access to any information requested in accordance with
the previous sentence.
The Servicer shall, on behalf of the Trust Fund, prepare,
sign and file with the Commission any and all reports, statements and
information respecting the Trust Fund which the Servicer or the Trustee
determines are required to be filed with the Commission pursuant to Sections
13(a) or 15(d) of the 1934 Act, each such report, statement and information to
be filed on or prior to the required filing date for such report, statement or
information. Notwithstanding the foregoing, the Depositor shall file with the
Commission, within ______ days of the Closing Date, a Current Report on Form
8-K together with this Agreement.
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Neither the Servicer not the Trustee shall be responsible
for the accuracy or completeness of any information supplied to it by a
Borrower or a third party that is included in any report, statement or
information filed with the Commission, and both the Servicer and the Trustee
shall be indemnified and held harmless by the Trust Fund against any loss,
liability or expense incurred in connection with any legal action relating to
any statement or omission or alleged statement or omission therein resulting
from such information.
SECTION 3.21. Reserve Accounts.
The Servicer shall administer each Reserve Account in
accordance with the related Note, Mortgage and Loan Agreement.
SECTION 3.22. Property Advances.
(a) The Servicer (or, to the extent provided in Section
3.22(b), the Trustee or the Fiscal Agent) shall make any Property Advances as
and to the extent otherwise required pursuant to the terms hereof. For purpose
of calculating distributions to the Certificateholders, Property Advances
shall not be considered to increase the principal balance of any Mortgage
Loan, notwithstanding that the terms of such Mortgage Loan so provide.
(b) The Servicer shall notify the Trustee and the Fiscal
Agent in writing promptly upon, and in any event within ___ Business Day
after, becoming aware that it will be financially unable to make any Property
Advance required to be made pursuant to the terms hereof, and in connection
therewith, shall set forth in such notice the amount of such Property Advance,
the Person to whom it should be paid, and the circumstances and purpose of
such Property Advance, and shall set forth therein information and
instructions for the payment of such Property Advance, and, on the date
specified in such notice for the payment of such Property Advance, or, if no
such date is specified, then within ___ Business Day following such notice,
the Trustee shall pay the amount of such Property Advance in accordance with
such information and instructions. If the Trustee fails to make any Property
Advance required to be made under this Section 3.22, the Fiscal Agent shall
make such Advance on the same day the Trustee was required to make such Property
Advance and, thereby, the Trustee shall not be in default under this Agreement.
(c) Notwithstanding anything herein to the contrary, none of
the Servicer, the Trustee or the Fiscal Agent shall be obligated to make a
Property Advance as to any Mortgage Loan or REO Property if the Servicer, the
Trustee or the Fiscal Agent as applicable, determines that such Property
Advance, if made, would be a Nonrecoverable Advance. The Trustee and the
Fiscal Agent shall be entitled to rely, conclusively, on any determination by
the Servicer that a Property Advance, if made, would be a Nonrecoverable
Advance. The Trustee and the Fiscal Agent, in determining whether or not a
Property Advance previously made is, or a proposed Property Advance, if made,
would be, a Nonrecoverable Advance shall be subject to the standards
applicable to the Servicer hereunder.
(d) The Servicer, the Trustee and/or the Fiscal Agent, as
applicable, shall be entitled to, and the Servicer hereby covenants and agrees
to promptly seek and effect, the
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reimbursement of Property Advances to the extent permitted pursuant to Section
3.6(ii) of this Agreement, together with any related Advance Interest Amount in
respect of such Property Advances.
(e) The Servicer, the Trustee and/or the Fiscal Agent shall
not be required to make a Property Advance for any amounts required to cure
any failure of any Mortgaged Property to comply with the Americans with
Disabilities Act of 1990, as amended, and all rules and regulations
promulgated pursuant thereto, and, in the case of an REO Property, such
amounts shall be an expense of the Trust Fund.
SECTION 3.23. Appointment of Special Servicer.
(a) ___________ is hereby appointed as the initial Special
Servicer to service each Specially Serviced Mortgage Loan.
(b) Certificateholders representing greater than __% of the
Voting Rights of the most subordinate Class of Regular Certificates
outstanding at any time shall be entitled to remove the Special Servicer with
or without cause and to appoint a successor Special Servicer, provided that
each Rating Agency confirms to the Trustee in writing that such appointment
shall not, in and of itself, cause a withdrawal, downgrading or qualification
of the then-current ratings assigned to any Class of Certificates.
(c) The appointment of any such successor Special Servicer
shall not relieve the Servicer, the Trustee or the Fiscal Agent of their
respective obligations to make Advances as set forth herein. Any termination
fee payable to the terminated Special Servicer (and it is hereby acknowledged
that there is no such fee payable in the event of a termination of ________ as
Special Servicer) shall be paid by the Certificateholders so terminating the
Special Servicer and shall not in any event be an expense of the Trust Fund.
(d) No termination of the Special Servicer and appointment
of a successor Special Servicer shall be effective until the successor Special
Servicer has assumed all of its responsibilities, duties and liabilities
hereunder pursuant to a writing satisfactory to the Trustee and each of the
Rating Agencies confirms to the Trustee in writing that such assumption shall
not result, in and of itself, in a downgrading, withdrawal or qualification of
the rating then assigned by such Rating Agency to any Class of the
Certificates.
SECTION 3.24. Transfer of Servicing Between Servicer and
Special Servicer; Record Keeping.
(a) Upon determining that any Mortgage Loan has become a
Specially Serviced Mortgage Loan, the Servicer shall immediately give notice
thereof, together with a copy of the related Mortgage File, to the Special
Servicer and shall use its best efforts to provide the Special Servicer with
all information, documents (but excluding the original documents constituting
such Mortgage File) and records (including records stored electronically on
computer tapes, magnetic discs and the like) relating to such Mortgage Loan
and reasonably requested by the Special Servicer to enable it to assume its
duties hereunder with respect thereto
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without acting through a sub-servicer. The Servicer shall use its best efforts
to comply with the preceding sentence within ____ Business Days of the date
such Mortgage Loan became a Specially Serviced Mortgage Loan and in any event
shall continue to act as Servicer and administrator of such Mortgage Loan
until the Special Servicer has commenced the servicing of such Mortgage Loan,
which shall occur upon the receipt by the Special Servicer of the information,
documents and records referred to in the preceding sentence. With respect to
each Mortgage Loan that becomes a Specially Serviced Mortgage Loan, the
Servicer shall instruct the related Borrower to continue to remit all payments
in respect of such Mortgage Loan to the Servicer. If ceases to be the Servicer
or ceases to be the Special Servicer, the remaining party of the two and the
successor Servicer or Special Servicer, as applicable, may agree that,
notwithstanding the preceding sentence, with respect to each Mortgage Loan
that became a Specially Serviced Mortgage Loan, the Servicer shall instruct
the related Borrower to remit all payments in respect of such Mortgage Loan to
the Special Servicer, provided that the payee in respect of such payments
shall remain the Servicer.
Upon determining that no event has occurred and is
continuing with respect to a Mortgage Loan that causes such Mortgage Loan to
be a Specially Serviced Mortgage Loan, the Special Servicer shall immediately
give notice thereof to the Servicer and upon giving such notice, such Mortgage
Loan shall cease to be a Specially Serviced Mortgage Loan pursuant to the
proviso to the definition of Specially Serviced Mortgage Loan, the Special
Servicer's obligation to service such Mortgage Loan shall terminate and the
obligations of the Servicer to service and administer such Mortgage Loan as a
Mortgage Loan that is not a Specially Serviced Mortgage Loan shall resume. In
addition, if the related Borrower has been instructed, pursuant to the last
sentence of the preceding paragraph, to make payments to the Special Servicer,
upon such determination, the Special Servicer shall instruct such Borrower to
remit all payments in respect of such Mortgage Loan that is no longer a
Specially Serviced Mortgage Loan directly to the Servicer.
(b) In servicing any Specially Serviced Mortgage Loan, the
Special Servicer shall provide to the Trustee originals of documents included
within the definition of "Mortgage File" for inclusion in the related Mortgage
File (to the extent such documents are in the possession of the Special
Servicer) and copies of any additional related Mortgage Loan information,
including correspondence with the related Borrower, and the Special Servicer
shall provide copies of all of the foregoing to the Servicer.
(c) Not later than the Business Day preceding each date on
which the Servicer is required to furnish a report under Section 3.13 to the
Trustee, the Special Servicer shall deliver to the Servicer a written
statement describing, on a Mortgage Loan-by-Mortgage Loan basis, (1) the
amount of all payments on account of interest received on each Specially
Serviced Mortgage Loan; the amount of all payments on account of principal,
including Principal Prepayments, on each Specially Serviced Mortgage Loan; the
amount of Insurance Proceeds and Liquidation Proceeds received with respect to
each Specially Serviced Mortgage Loan; and the amount of net income or net
loss, as determined for management of a trade or business on, or the
furnishing or rendering of a non-customary service to the tenants of, each REO
Property that previously secured a Specially Serviced Mortgage Loan, in each
case in accordance with Section
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3.17 and (2) such additional information relating to the Specially Serviced
Mortgage Loans as the Servicer reasonably requests to enable it to perform its
duties under this Agreement.
(d) Notwithstanding the provisions of the preceding
subsection (c), the Servicer shall maintain ongoing payment records with
respect to each of the Specially Serviced Mortgage Loans and shall provide the
Special Servicer with any information reasonably required by the Special
Servicer to perform its duties under this Agreement. The Special Servicer
shall provide the Servicer with any information reasonably required by the
Servicer to perform its duties under this Agreement.
SECTION 3.25. Adjustment of Servicing Compensation in Respect
of Prepayment Interest Shortfalls.
(a) The aggregate amount of the Prepayment Interest Surplus
and Servicing Fees (in that order) that the Servicer shall be entitled to
receive with respect to all of the Mortgage Loans on each Distribution Date
shall be offset on such Distribution Date by an amount equal to the aggregate
of the Prepayment Interest Shortfalls for such Distribution Date with respect
to all Mortgage Loans. The Servicer shall include the amount by which the
aggregate Servicing Fees and Prepayment Interest Surplus is offset pursuant to
this Section 3.25 as part of the Pooled Available Funds on such Distribution
Date. The amount of any offset against the aggregate Servicing Fees and
Prepayment Interest Surplus with respect to any Distribution Date under this
Section 3.25 shall be limited to the aggregate amount of the Servicing Fees
and Prepayment Interest Surplus otherwise payable to the Servicer on such
Distribution Date (without adjustment on account of Prepayment Interest
Shortfalls) and the rights of the Certificateholders to offset of the
aggregate Prepayment Interest Shortfalls shall not be cumulative. To the
extent the Servicer shall already have withdrawn or withheld Servicing
Compensation required to pay Prepayment Interest Shortfalls, the Servicer
shall promptly deposit in the Collection Amount such amounts to the extent
required to pay Prepayment Interest Shortfalls hereunder.
(b) To the extent that the Servicer and the Special Servicer
are the same Person, the aggregate amount of the Special Servicing Fees that
the Special Servicer shall be entitled to receive with respect to all of the
Specially Serviced Mortgage Loans on each Distribution Date shall be offset on
such Distribution Date by an amount equal to the excess of (X) the aggregate
of the Prepayment Interest Shortfalls for such Distribution Date with respect
to all Mortgage Loans over (Y) the amount of Servicing Fees offset against
such Prepayment Interest Shortfalls in accordance with Section 3.25(a). The
Servicer shall include the amount by which the aggregate Special Servicing Fee
is offset pursuant to this Section 3.25 as part of the Pooled Available Funds
on such Distribution Date. The amount of any offset against the aggregate
Special Servicing Fee with respect to any Distribution Date under this Section
3.25 shall be limited to the aggregate amount of the Special Servicing Fees
otherwise payable to the Special Servicer on such Distribution Date (without
adjustment on account of Prepayment Interest Shortfalls) and the rights of the
Certificateholders to offset of the aggregate Prepayment Interest Shortfalls
shall not be cumulative.
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SECTION 3.26. Extension Advisor.
The Special Servicer shall obtain the prior written approval
of the Extension Advisor in respect of any proposed modification of a Mortgage
Loan pursuant to Section 3.10(a) with respect to which three successive
extensions shall have already been granted. The Special Servicer shall advise
the Extension Advisor in a written report (in reasonable detail) if any such
modification after the third successive previous extension of such Mortgage
Loan with respect to a Specially Serviced Mortgage Loan is proposed and the
Special Servicer shall grant such extension only if the Extension Advisor
approves such extension in writing.
The Extension Advisory Fee shall be paid to the Extension
Advisor, first from loan modification fees paid by the Borrower under the
related Mortgage Loan as to which an extension was requested, and, to the
extent that such loan modification fees are insufficient to pay the Extension
Advisory Fee, any such shortfall shall be paid from the Servicing
Compensation; provided that the reduction in Servicing Compensation shall be
allocated equally between the Servicer and the Special Servicer.
The Extension Advisor may be replaced at any time by the
Holders of____% of the Voting Rights allocated to each Class of Regular
Certificates, other than the most subordinate such Class of Regular
Certificates, by written notice to the Extension Advisor, the Trustee and the
Special Servicer. Notwithstanding anything to the contrary contained herein,
in no event shall the Special Servicer be the Extension Advisor.
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ARTICLE IV
DISTRIBUTIONS TO CERTIFICATEHOLDERS
SECTION 4.1. Distributions.
(a) (I) On each Remittance Date, to the extent of Pooled
Available Funds, amounts held in the Collection Account shall be withdrawn and
remitted to the Trustee for deposit in the Distribution Account in the
following amounts:
(i) First, pro rata (A) to the Class ___ Interest in
respect of interest, (1) the Interest Distribution
Amount therefor, and (2) the aggregate unpaid
Interest Shortfalls allocated to the Class
____________ Interest on any prior Distribution
Date; (B) to the Class ________________ Interest in
respect of interest, (1) the Interest Distribution
Amount therefor, and (2) the aggregate unpaid
Interest Shortfalls allocated to the Class
_____________ Interest on any prior Distribution
Date; (C) to the Class ___________ Interest in
respect of interest, (1) the portion of the
Interest Distribution Amount therefor that is in
excess of interest thereon at the Class _________
Pass-Through Rate and (2) a proportionate amount of
any unpaid Interest Shortfalls allocated to the
Class ___________ Interest on any prior
Distribution Date; (D) to the Class __ Interest in
respect of interest, (1) the portion of the
Interest Distribution Amount therefor that is in
excess of interest thereon at the Class ________
Through Rate and (2) a proportionate amount of any
unpaid Interest Shortfalls allocated to the Class
___ Interest on any prior Distribution Date; (E) to
the Class ___ Interest in respect of interest, (1)
the portion of the Interest Distribution Amount
therefor that is in excess of interest thereon at
the Class __ Pass-Through Rate and (2) a
proportionate amount of any unpaid Interest
Shortfalls allocated to the Class ___ Interest on
any prior Distribution Date; and (F) to the Class
___ Interest in respect of interest, (1) the
portion of the Interest Distribution Amount
therefor that is in excess of interest thereon at
the Class __ Pass-Through Rate and (2) a
proportionate amount of any unpaid Interest
Shortfalls allocated to the Class ___ Interest on
any prior Distribution Date;
(ii) Second, to the Class ___ Interest, in reduction of
the Certificate Balance thereof, the Pooled
Principal Distribution Amount for such Distribution
Date, until the Certificate Balance thereof is
reduced to zero;
(iii) Third, to the Class _________ Interest, for the
unreimbursed amounts of Realized Losses, if any,
together with simple interest thereon at a rate
equal to ___% per annum from the date on which such
unreimbursed Realized Loss was allocated (or the
date on which interest was last paid) to, but not
including, the Distribution Date following the
Remittance Date on which distributions in respect
of such unreimbursed Realized Loss are
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made pursuant to this subparagraph, up to an amount
equal to the aggregate of such unreimbursed
Realized Losses previously allocated to such
Lower-Tier Regular Interest and interest thereon,
provided that any distribution pursuant to this
subparagraph shall be deemed to be distributed
first in respect of any such interest and then in
respect of any such unreimbursed Realized Loss;
(iv) Fourth, to the Class ________ Interest, in
reduction of the Certificate Balance thereof, the
Pooled Principal Distribution Amount for such
Distribution Date, until the Certificate Balance
thereof is reduced to zero;
(v) Fifth, to the Class _________ Interest, for the
unreimbursed amounts of Realized Losses, if any,
together with simple interest thereon at a rate
equal to ___% per annum from the date on which such
unreimbursed Realized Loss was allocated (or the
date on which interest was last paid) to, but not
including, the Distribution Date following the
Remittance Date on which distributions in respect
of such unreimbursed Realized Loss are made
pursuant to this subparagraph, up to an amount
equal to the aggregate of such unreimbursed
Realized Losses previously allocated to such
Lower-Tier Regular Interest and interest thereon,
provided that any distribution pursuant to this
subparagraph shall be deemed to be distributed
first in respect of any such interest and then in
respect of any such unreimbursed Realized Loss;
(vi) Sixth, to the Class ___ Interest, in respect of
interest, (A) the portion of the Interest
Distribution Amount therefor that is equal to
interest thereon at the Class ___ Pass-Through Rate
and (B) a proportionate amount of the aggregate
unpaid Interest Shortfalls allocated to the Class
___ Interest on any prior Distribution Date;
(vii) Seventh, after the Certificate Balance of the Class
___ Interest has been reduced to zero, to the Class
___ Interest, in reduction of the Certificate
Balance thereof, the Pooled Principal Distribution
Amount less the portion thereof distributed on such
Distribution Date pursuant to any preceding clause,
until the Certificate Balance of the Class ___
Interest is reduced to zero;
(viii) Eighth, to the Class ___ Interest, for the
unreimbursed amounts of Realized Losses, if any,
together with simple interest thereon at a rate
equal to ___% per annum from the date on which such
unreimbursed Realized Loss was allocated (or the
date on which interest was last paid) to, but not
including, the Distribution Date following the
Remittance Date on which distributions in respect
of such unreimbursed Realized Loss are made
pursuant to this subparagraph, up to an amount
equal to the aggregate of such unreimbursed
Realized Losses previously allocated to such
Lower-Tier Regular Interest and interest thereon,
provided that any
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distribution pursuant to this subparagraph shall be
deemed to be distributed first in respect of any
such interest and then in respect of any such
unreimbursed Realized Loss;
(ix) Ninth, to the Class ___ Interest, in respect of
interest, (A) the portion of the Interest
Distribution Amount therefor that is equal to
interest thereon at the Class __ Pass-Through Rate
and (B) a proportionate amount of the aggregate
unpaid Interest Shortfalls allocated to the Class
__ Interest on any prior Distribution Date;
(x) Tenth, after the Certificate Balance of the Class
___ Interest has been reduced to zero, to the Class
___ Interest, in reduction of the Certificate
Balance thereof, the Pooled Principal Distribution
Amount less the portion thereof distributed on such
Distribution Date pursuant to any preceding clause,
until the Certificate Balance of the Class ___
Interest is reduced to zero;
(xi) Eleventh, to the Class ___ Interest, for the
unreimbursed amounts of Realized Losses, if any,
together with simple interest thereon at a rate
equal to ____% per annum from the date on which
such unreimbursed Realized Loss was allocated (or
the date on which interest was last paid) to, but
not including, the Distribution Date following the
Remittance Date on which distributions in respect
of such unreimbursed Realized Loss are made
pursuant to this subparagraph, up to an amount
equal to the aggregate of such unreimbursed
Realized Losses previously allocated to such
Lower-Tier Regular Interest and interest thereon,
provided that any distribution pursuant to this
subparagraph shall be deemed to be distributed
first in respect of any such interest and then in
respect of any such unreimbursed Realized Loss;
(xii) Twelfth, to the Class ___ Interest, in respect of
interest, (A) the portion of the Interest
Distribution Amount therefor that is equal to
interest thereon at the Class ___ Pass-Through Rate
and (B) a proportionate amount of the aggregate
unpaid Interest Shortfalls allocated to the Class
___ Interest on any prior Distribution Date;
(xiii) Thirteenth, after the Certificate Balance of the
Class ___ Interest has been reduced to zero, to the
Class ___ Interest, in reduction of the Certificate
Balance thereof, the Pooled Principal Distribution
Amount less the portion thereof distributed on such
Distribution Date pursuant to any preceding clause,
until the Certificate Balance of the Class ___
Interest is reduced to zero;
(xiv) Fourteenth, to the Class ___ Interest, for the
unreimbursed amounts of Realized Losses, if any,
together with simple interest thereon at a rate
equal to ___% per annum from the date on which such
unreimbursed
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Realized Loss was allocated (or the date on which
interest was last paid) to, but not including, the
Distribution Date following the Remittance Date on
which distributions in respect of such unreimbursed
Realized Loss are made pursuant to this
subparagraph, up to an amount equal to the
aggregate of such unreimbursed Realized Losses
previously allocated to such Lower-Tier Regular
Interest and interest thereon, provided that any
distribution pursuant to this subparagraph shall be
deemed to be distributed first in respect of any
such interest and then in respect of any such
unreimbursed Realized Loss;
(xv) Fifteenth, to the Class ___ Interest, in respect of
interest, (A) the portion of the Interest
Distribution Amount therefor that is equal to
interest thereon at the Class __ Pass-Through Rate
and (B) a proportionate amount of the aggregate
unpaid Interest Shortfalls allocated to the Class
___ Interest on any prior Distribution Date;
(xvi) Sixteenth, after the Certificate Balance of the
Class ___ Interest has been reduced to zero, to the
Class ___ Interest, in reduction of the Certificate
Balance thereof, the Pooled Principal Distribution
Amount less the portion thereof distributed on such
Distribution Date pursuant to any preceding clause,
until the Certificate Balance of the Class ___
Interest is reduced to zero;
(xvii) Seventeenth, to the Class ___ Interest, for the
unreimbursed amounts of Realized Losses, if any,
together with simple interest thereon at a rate
equal to ___% per annum from the date on which such
unreimbursed Realized Loss was allocated (or the
date on which interest was last paid) to, but not
including, the Distribution Date following the
Remittance Date on which distributions in respect
of such unreimbursed Realized Loss are made
pursuant to this subparagraph, up to an amount
equal to the aggregate of such unreimbursed
Realized Losses previously allocated to such
Lower-Tier Regular Interest and interest thereon,
provided that any distribution pursuant to this
subparagraph shall be deemed to be distributed
first in respect of any such interest and then in
respect of any such unreimbursed Realized Loss;
(xviii) Eighteenth, to the Class ___ Interest, in respect
of interest, (A) the Interest Distribution Amount
therefor and (B) the aggregate unpaid Interest
Shortfalls allocated to the Class ___ Interest on
any prior Distribution Date;
(xix) Nineteenth, after the Certificate Balance of the
Class ___ Interest has been reduced to zero, to the
Class ___ Interest, in reduction of the Certificate
Balance thereof, the Pooled Principal Distribution
Amount less the portion thereof distributed on such
Distribution Date pursuant to any preceding
96
clause, until the Certificate Balance of the Class
___ Interest is reduced to zero;
(xx) Twentieth, to the Class ___ Interest, for the
unreimbursed amounts of Realized Losses, if any,
together with simple interest thereon at a rate
equal to ___% per annum from the date on which such
unreimbursed Realized Loss was allocated (or the
date on which interest was last paid) to, but not
including, the Distribution Date following the
Remittance Date on which distributions in respect
of such unreimbursed Realized Loss are made
pursuant to this subparagraph, up to an amount
equal to the aggregate of such unreimbursed
Realized Losses previously allocated to such
Lower-Tier Regular Interest and interest thereon,
provided that any distribution pursuant to this
subparagraph shall be deemed to be distributed
first in respect of any such interest and then in
respect of any such unreimbursed Realized Loss;
(xxi) Twenty-First, to the Class ___ Interest, in respect
of interest, (A) the Interest Distribution Amount
therefor and (B) the aggregate unpaid Interest
Shortfalls allocated to the Class ___ Interest on
any prior Distribution Date;
(xxii) Twenty-Second, after the Certificate Balance of the
Class ___ Interest has been reduced to zero, to the
Class ___ Interest, in reduction of the Certificate
Balance thereof, the Pooled Principal Distribution
Amount less the portion thereof distributed on such
Distribution Date pursuant to any preceding clause,
until the Certificate Balance of the Class ___
Interest is reduced to zero;
(xxiii) Twenty-Third, to the Class ___ Interest, for the
unreimbursed amounts of Realized Losses, if any,
together with simple interest thereon at a rate
equal to ___% per annum from the date on which such
unreimbursed Realized Loss was allocated (or the
date on which interest was last paid) to, but not
including, the Distribution Date following the
Remittance Date on which distributions in respect
of such unreimbursed Realized Loss are made
pursuant to this subparagraph, up to an amount
equal to the aggregate of such unreimbursed
Realized Losses previously allocated to such
Lower-Tier Regular Interest and interest thereon,
provided that any distribution pursuant to this
subparagraph shall be deemed to be distributed
first in respect of any such interest and then in
respect of any such unreimbursed Realized Loss;
(xxiv) Twenty-Fourth, to the Class ___ Interest, in
respect of interest, (A) the Interest Distribution
Amount therefor and (B) the aggregate unpaid
Interest Shortfalls allocated to the Class ___
Interest on any prior Distribution Date;
97
(xxv) Twenty-Fifth, after the Certificate Balance of the
Class ___ Interest has been reduced to zero, to the
Class ___ Interest, in reduction of the Certificate
Balance thereof, the Pooled Principal Distribution
Amount less the portion thereof distributed on such
Distribution Date pursuant to any preceding clause,
until the Certificate Balance of the Class ___
Interest is reduced to zero;
(xxvi) Twenty-Sixth, to the Class __ Interest, for the
unreimbursed amounts of Realized Losses, if any,
together with simple interest thereon at a rate
equal to ___% per annum from the date on which such
unreimbursed Realized Loss was allocated (or the
date on which interest was last paid) to, but not
including, the Distribution Date following the
Remittance Date on which distributions in respect
of such unreimbursed Realized Loss are made
pursuant to this subparagraph, up to an amount
equal to the aggregate of such unreimbursed
Realized Losses previously allocated to such
Lower-Tier Regular Interest and interest thereon,
provided that any distribution pursuant to this
subparagraph shall be deemed to be distributed
first in respect of any such interest and then in
respect of any such unreimbursed Realized Loss;
(xxvii) Twenty-Seventh, to the Class ___ Interest, in
respect of interest, (A) the Interest Distribution
Amount therefor and (B) the aggregate unpaid
Interest Shortfalls allocated to the Class ___
Interest on any prior Distribution Date;
(xxviii) Twenty-Eighth, after the Certificate Balance of the
Class ___ Interest has been reduced to zero, to the
Class ___ Interest, in reduction of the Certificate
Balance thereof, the Pooled Principal Distribution
Amount less the portion thereof distributed on such
Distribution Date pursuant to any preceding clause,
until the Certificate Balance of the Class ___
Interest is reduced to zero;
(xxix) Twenty-Ninth, if such Remittance Date occurs after
the EC Maturity Date, to (i)the Class _______
Interest, (ii) the Class ______ Interest, (iii) the
Class ___________ Interest, (iv) the Class ________
Interest, (v) the Class ________ Interest, (vi) the
Class _________ Interest, (vii) the Class
__________ Interest, (viii) the Class _______
Interest, (ix) the Class _________ Interest, and
(x) the Class ________ Interest, in that order, in
reduction of the Certificate Balance of each
thereof, any remaining portion of Pooled Available
Funds in the Collection Account, until the
Certificate Balance of each has been reduced to
zero; and
(xxx) Thirtieth, to the Class _________ Interest, for the
unreimbursed amounts of Realized Losses, if any,
together with simple interest thereon at a rate
equal to ___________ % per annum from the date on
which such unreimbursed Realized Loss was allocated
(or the date on which interest was last paid)
98
to, but not including, the Distribution Date
following the Remittance Date on which distributions
in respect of such unreimbursed Realized Loss are
made pursuant to this subparagraph, up to an amount
equal to the aggregate of such unreimbursed
Realized Losses previously allocated to such
Lower-Tier Regular Interests and interest thereon,
provided that any distribution pursuant to this
subparagraph shall be deemed to be distributed
first in respect of any such interest and then in
respect of any such unreimbursed Realized Loss; and
(xxxi) Thirty-First, to the Class _______ Certificates,
any Pooled Available Funds remaining in the
Collection Account.
(II) On each Remittance Date, the Trustee shall receive for
deposit into the Distribution Account in respect of each Lower-Tier Regular
Interest, distributions from amounts on deposit in the Collection Account in
respect of Prepayment Premiums, if any, distributable to its Related
Certificate (or (i) in the case of the Class __________ Interest, amounts
distributable to the Class __________ Certificates and (ii) in the case of the
Class _____________ Interest, amounts distributable to the Class __________
Certificates) pursuant to Section .
(b) (I) On each Distribution Date, to the extent of amounts
remitted to the Distribution Account pursuant to Section ___________, Holders
of each Class of Certificates (other than the Class ___________ Certificates)
shall receive distributions from amounts on deposit in the Distribution
Account, up to the Pooled Available Funds for such Distribution Date, in the
amounts and in the order of priority set forth below:
(i) First, to the Class _______ Certificates,
Class Certificates and Class ________
Certificates, pro rata in accordance with
the Class Interest Distribution Amount of
each, up to an amount equal to the Class
Interest Distribution Amount of each such
Class for such Distribution Date;
(ii) Second, to the Class ________ Certificates,
Class __________ Certificates and
Class __________ Certificates, pro rata
in accordance with the Class Interest
Shortfall of each, up to an amount equal
to the aggregate unpaid Class Interest
Shortfalls previously allocated to such
Class on any previous Distribution Dates
and not paid;
(iii) Third, to the Class ________ Certificates,
in reduction of the Certificate Balance
thereof, the Pooled Principal Distribution
Amount for such Distribution Date, until
the Certificate Balance thereof is reduced
to zero;
(iv) Fourth, after the Certificate Balance of
the Class __________ Certificates has been
reduced to zero, to the Class _________
Certificates, in reduction of the
Certificate Balance thereof, the
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Pooled Principal Distribution Amount for
such Distribution Date, until the
Certificate Balance thereof is reduced to
zero;
(v) Fifth, to the Class ________ Certificates
and the Class _______ Certificates, pro
rata, for the unreimbursed amounts of
Realized Losses, if any, together with
simple interest thereon at a rate equal to
_________ % per annum from the date on
which such unreimbursed Realized Loss was
allocated (or the date on which interest
was last paid) to, but not including, the
Distribution Date on which distributions
in respect of such unreimbursed Realized
Loss are made pursuant to this
subparagraph, up to an amount equal to the
aggregate of such unreimbursed Realized
Losses previously allocated to the Class
_________ Certificates and the Class
_________ Class Certificates and interest
thereon, provided that any distribution
pursuant to this subparagraph shall be
deemed to be distributed first in respect
of any such interest and then in respect
of any such unreimbursed Realized Loss;
(vi) Sixth, to the Class __________
Certificates, up to an amount equal to the
Class Interest Distribution Amount of such
Class for such Distribution Date;
(vii) Seventh, to the Class __________
Certificates, up to an amount equal to the
aggregate unpaid Class Interest Shortfalls
previously allocated to such Class on any
previous Distribution Dates and not paid;
(viii) Eighth, after the Certificate Balance of
the Class ____ Certificates has been
reduced to zero, to the Class ________
Certificates, in reduction of the
Certificate Balance thereof, the Pooled
Principal Distribution Amount for such
Distribution Date less the portion thereof
distributed on such Distribution Date
pursuant to any preceding clause, until
the Certificate Balance thereof is reduced
to zero;
(ix) Ninth, to the Class _____ Certificates,
for the unreimbursed amounts of Realized
Losses, if any, together with simple
interest thereon at a rate equal to ___%
per annum from the date on which such
unreimbursed Realized Loss was allocated
(or the date on which interest was last
paid) to, but not including, the
Distribution Date on which distributions
in respect of such unreimbursed Realized
Loss are made pursuant to this
subparagraph, up to an amount equal to the
aggregate of such unreimbursed Realized
Losses previously allocated to the Class
_______ Certificates and interest thereon,
provided that any distribution pursuant to
this subparagraph shall be deemed to be
distributed first in respect of
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any such interest and then in respect of
any such unreimbursed Realized Loss;
(x) Tenth, to the Class _______ Certificates,
up to an amount equal to the Class
Interest Distribution Amount of such Class
for such Distribution Date;
(xi) Eleventh, to the Class _______
Certificates, up to an amount equal to the
aggregate unpaid Class Interest Shortfalls
previously allocated to such Class on any
previous Distribution Dates and not paid;
(xii) Twelfth, after the Certificate Balance of
the Class _______ Certificates has been
reduced to zero, to the Class __________
Certificates, in reduction of the
Certificate Balance thereof, the Pooled
Principal Distribution Amount for such
Distribution Date less the portion thereof
distributed on such Distribution Date
pursuant to any preceding clause, until
the Certificate Balance thereof is reduced
to zero;
(xiii) Thirteenth, to the Class ___ Certificates,
for the unreimbursed amounts of Realized
Losses, if any, together with simple
interest thereon at a rate equal to ____%
per annum from the date on which such
unreimbursed Realized Loss was allocated
(or the date on which interest was last
paid) to, but not including, the
Distribution Date on which distributions
in respect of such unreimbursed Realized
Loss are made pursuant to this
subparagraph, up to an amount equal to the
aggregate of such unreimbursed Realized
Losses previously allocated to the Class
____ Certificates and interest thereon,
provided that any distribution pursuant to
this subparagraph shall be deemed to be
distributed first in respect of any such
interest and then in respect of any such
unreimbursed Realized Loss;
(xiv) Fourteenth, to the Class _______
Certificates, up to an amount equal to the
Class Interest Distribution Amount of such
Class for such Distribution Date;
(xv) Fifteenth, to the Class _______
Certificates, up to an amount equal to the
aggregate unpaid Class Interest Shortfalls
previously allocated to such Class on any
previous Distribution Dates and not paid;
(xvi) Sixteenth, after the Certificate Balance
of the Class ______ Certificates has been
reduced to zero, to the Class _____
Certificates, in reduction of the
Certificate Balance thereof, the Pooled
Principal Distribution Amount for such
Distribution Date less the portion thereof
distributed on such Distribution Date
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pursuant to any preceding clause, until
the Certificate Balance thereof is reduced
to zero;
(xvii) Seventeenth, to the Class _______
Certificates, for the unreimbursed amounts
of Realized Losses, if any, together with
simple interest thereon at a rate equal to
___% per annum from the date on which such
unreimbursed Realized Loss was allocated
(or the date on which interest was last
paid) to, but not including, the
Distribution Date on which distributions
in respect of such unreimbursed Realized
Loss are made pursuant to this
subparagraph, up to an amount equal to the
aggregate of such unreimbursed Realized
Losses previously allocated to the Class
______ Certificates and interest thereon,
provided that any distribution pursuant to
this subparagraph shall be deemed to be
distributed first in respect of any such
interest and then in respect of any such
unreimbursed Realized Loss;
(xviii) Eighteenth, to the Class _______
Certificates, up to an amount equal to the
Class Interest Distribution Amount of such
Class for such Distribution Date;
(xix) Nineteenth, to the Class _______
Certificates, up to an amount equal to the
aggregate unpaid Class Interest Shortfalls
previously allocated to such Class on any
previous Distribution Dates and not paid;
(xx) Twentieth, after the Certificate Balance
of the Class _______ Certificates has been
reduced to zero, to the Class ________
Certificates, in reduction of the
Certificate Balance thereof, the Pooled
Principal Distribution Amount for such
Distribution Date less the portion thereof
distributed on such Distribution Date
pursuant to any preceding clause, until
the Certificate Balance thereof is reduced
to zero;
(xxi) Twenty-First, to the Class _____
Certificates, for the unreimbursed amounts
of Realized Losses, if any, together with
simple interest thereon at a rate equal to
____% per annum from the date on which
such unreimbursed Realized Loss was
allocated (or the date on which interest
was last paid) to, but not including, the
Distribution Date on which distributions
in respect of such unreimbursed Realized
Loss are made pursuant to this
subparagraph, up to an amount equal to the
aggregate of such unreimbursed Realized
Losses previously allocated to the Class
_______ Certificates and interest thereon,
provided that any distribution pursuant to
this subparagraph shall be deemed to be
distributed
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first in respect of any such interest and
then in respect of any such unreimbursed
Realized Loss;
(xxii) Twenty-Second, to the Class ______
Certificates, up to an amount equal to the
Class Interest Distribution Amount of such
Class for such Distribution Date;
(xxiii) Twenty-Third, to the Class ________
Certificates, up to an amount equal to the
aggregate unpaid Class Interest Shortfalls
previously allocated to such Class on any
previous Distribution Dates and not paid;
(xxiv) Twenty-Fourth, after the Certificate
Balance of the Class __ Certificates has
been reduced to zero, to the Class __
Certificates, in reduction of the
Certificate Balance thereof, the Pooled
Principal Distribution Amount for such
Distribution Date less the portion thereof
distributed on such Distribution Date
pursuant to any preceding clause, until
the Certificate Balance thereof is reduced
to zero;
(xxv) Twenty-Fifth, to the Class _______
Certificates, for the unreimbursed amounts
of Realized Losses, if any, together with
simple interest thereon at a rate equal to
_________ % per annum from the date on
which such unreimbursed Realized Loss was
allocated (or the date on which interest
was last paid) to, but not including, the
Distribution Date on which distributions
in respect of such unreimbursed Realized
Loss are made pursuant to this
subparagraph, up to an amount equal to the
aggregate of such unreimbursed Realized
Losses previously allocated to the Class
_______ Certificates and interest thereon,
provided that any distribution pursuant to
this subparagraph shall be deemed to be
distributed first in respect of any such
interest and then in respect of any such
unreimbursed Realized Loss;
(xxvi) Twenty-Sixth, to the Class _______
Certificates, up to an amount equal to the
Class Interest Distribution Amount of such
Class for such Distribution Date;
(xxvii) Twenty-Seventh, to the Class __________
Certificates, up to an amount equal to the
aggregate unpaid Class Interest Shortfalls
previously allocated to such Class on any
previous Distribution Dates and not paid;
(xxviii) Twenty-Eighth, after the Certificate
Balance of the Class ______ Certificates
has been reduced to zero, to the Class
_________ Certificates, in reduction of
the Certificate Balance thereof, the
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Pooled Principal Distribution Amount for
such Distribution Date less the portion
thereof distributed on such Distribution
Date pursuant to any preceding clause,
until the Certificate Balance thereof is
reduced to zero;
(xxix) Twenty-Ninth, to the Class ____
Certificates, for the unreimbursed amounts
of Realized Losses, if any, together with
simple interest thereon at a rate equal to
___% per annum from the date on which such
unreimbursed Realized Loss was allocated
(or the date on which interest was last
paid) to, but not including, the
Distribution Date on which distributions
in respect of such unreimbursed Realized
Loss are made pursuant to this
subparagraph, up to an amount equal to the
aggregate of such unreimbursed Realized
Losses previously allocated to the Class
______ Certificates and interest thereon,
provided that any distribution pursuant to
this subparagraph shall be deemed to be
distributed first in respect of any such
interest and then in respect of any such
unreimbursed Realized Loss;
(xxx) Thirtieth, to the Class ____ Certificates,
up to an amount equal to the Class
Interest Distribution Amount of such Class
for such Distribution Date;
(xxxi) Thirty-First, to the Class ______
Certificates, up to an amount equal to the
aggregate unpaid Class Interest Shortfalls
previously allocated to such Class on any
previous Distribution Dates and not paid;
(xxxii) Thirty-Second, after the Certificate
Balance of the Class ____ Certificates has
been reduced to zero, to the Class ______
Certificates, in reduction of the
Certificate Balance thereof, the Pooled
Principal Distribution Amount for such
Distribution Date less the portion thereof
distributed on such Distribution Date
pursuant to any preceding clause, until
the Certificate Balance thereof is reduced
to zero;
(xxxiii) Thirty-Third, to the Class ____
Certificates, for the unreimbursed amounts
of Realized Losses, if any, together with
simple interest thereon at a rate equal to
___% per annum from the date on which such
unreimbursed Realized Loss was allocated
(or the date on which interest was last
paid) to, but not including, the
Distribution Date on which distributions
in respect of such unreimbursed Realized
Loss are made pursuant to this
subparagraph, up to an amount equal to the
aggregate of such unreimbursed Realized
Losses previously allocated to the Class
___________ Certificates and interest
thereon, provided that
104
any distribution pursuant to this
subparagraph shall be deemed to be
distributed first in respect of any such
interest and then in respect of any such
unreimbursed Realized Loss;
(xxxiv) Thirty-Fourth, to the Class ______
Certificates, up to an amount equal to the
Class Interest Distribution Amount of such
Class for such Distribution Date;
(xxxv) Thirty-Fifth, to the Class _______
Certificates, up to an amount equal to the
aggregate unpaid Class Interest Shortfalls
previously allocated to such Class on any
previous Distribution Dates and not paid;
(xxxvi) Thirty-Sixth, after the Certificate
Balance of the Class Certificates has been
reduced to zero, to the Class
Certificates, in reduction of the
Certificate Balance thereof, the Pooled
Principal Distribution Amount for such
Distribution Date less the portion thereof
distributed on such Distribution Date
pursuant to any preceding clause, until
the Certificate Balance thereof is reduced
to zero;
(xxxvii) Thirty-Seventh, if such Distribution Date
occurs after the EC Maturity Date, to (i)
the Class ______ Certificates, (ii) the
Class _________ Certificates, (iii) the
Class ______ Certificates, (iv) the Class
______ Certificates, (v) the Class
________ Certificates, (vi) the Class
_________ Certificates, (vii) the Class
_________ Certificates, (viii) the Class
______________ Certificates and the Class
_______ Certificates, pro rata, and (x)
the Class _________ Certificates, in that
order, in reduction of the Certificate
Balance of each thereof, any remaining
portion of Pooled Available Funds in the
Distribution Account, until the
Certificate Balance of each has been
reduced to zero; and
(xxxviii) Thirty-Eighth, to the Class ____
Certificates, for the unreimbursed amounts
of Realized Losses, if any, together with
simple interest thereon at a rate equal to
___% per annum from the date on which such
unreimbursed Realized Loss was allocated
(or the date on which interest was last
paid) to, but not including, the
Distribution Date on which distributions
in respect of such unreimbursed Realized
Loss are made pursuant to this
subparagraph, up to an amount equal to the
aggregate of such unreimbursed Realized
Losses previously allocated to the Class
___ Certificates and interest thereon,
provided that any distribution pursuant to
this subparagraph shall be deemed to be
distributed first in respect of any such
interest and then in respect of any such
unreimbursed Realized Loss.
105
All references to pro rata in the preceding clauses shall mean pro rata based
on the amount distributable pursuant to such clause.
Notwithstanding anything to the contrary in this Agreement,
on each Distribution Date prior to the earlier of (i) the Senior Principal
Distribution Cross-Over Date and (ii) the final Distribution Date in
connection with the termination of the Trust Fund, all distributions of
principal to the Class ______ Certificates and the Class _____ Certificates
will be paid, first, to holders of the Class _____ Certificates until the
Certificate Balance of such Certificates is reduced to zero, and thereafter,
to holders of the Class ______ Certificates, until the Certificate Balance of
such Certificates is reduced to zero. On each Distribution Date on and after
the Senior Principal Distribution Cross-Over Date, and in any event on the
final Distribution Date in connection with the termination of the Trust Fund,
distributions of principal on the Class ______ Certificates and the Class
_____ Certificates will be paid to holders of such two Class of Certificates,
pro rata in accordance with their respective Certificate Balances outstanding
immediately prior to such Distribution Date, until the Certificate Balance of
each such Class of Certificates is reduced to zero.
(II) On each Distribution Date, amounts remaining in the
Distribution Account following the distributions to the Certificates pursuant
to Section 4.1(b) and (c) shall be distributed to the Class _______
Certificates.
(c) On each Distribution Date, following the distribution
from the Collection Account to the Distribution Account pursuant to Section
4.1(a)(II), the Paying Agent shall make distributions of Prepayment Premiums
with respect to any Principal Prepayments received in the related Collection
Period from amounts deposited in the Distribution Account pursuant to Section
4.6(b)(i) as follows:
(I) On each Distribution Date up to and including the EC
Maturity Date, Prepayment Premiums received with respect to Yield Maintenance
Loans during the Yield Maintenance Period for such Yield Maintenance Loans,
shall be distributed to the Holders of the Certificates outstanding on such
Distribution Date, in the following amounts and order of priority:
(i) First, to the Class of Certificates which is
entitled to distributions in respect of principal on such
Distribution Date (other than pursuant to clause thirty-seventh of
Section 4.1(b)(I)), an amount equal to (A) the present value
(discounted at the Discount Rate) of the principal and interest
distributions that would have been paid in respect of such Class of
Certificates from the Distribution Date occurring in the following
month until the Certificate Balance of such Class of Certificates
would have been reduced to zero had the related prepayment not
occurred (and assuming no other prepayments were made), less (B) the
present value (discounted at the Discount Rate) of the principal and
interest distributions that will be paid in respect of such Class of
Certificates from the Distribution Date occurring in the following
month until the Certificate Balance of such Class of Certificates is
reduced to zero following such prepayment (assuming no further
prepayments are made and no delinquencies or defaults occur) less (C)
the amount of such prepayment; provided that if more than one Class
of
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Certificates is entitled to distributions in respect of principal
on such Distribution Date (other than pursuant to clause thirty-seventh
of Section 4.1(b)(I)), the amount set forth herein shall be calculated
for each such Class, and the amount of Prepayment Premiums shall be
allocated among such Classes, pro rata in accordance with the amounts
so calculated, up to an amount equal to the sum of such amounts so
calculated; and
(ii) Second, any remaining Prepayment Premiums
following the distribution in clause First above, to the Class ______
Certificates.
(II) With respect to each Distribution Date up to and
including the EC Maturity Date, any Prepayment Premiums received with respect
to any Mortgage Loan that is not a Yield Maintenance Loan and any Prepayment
Premiums received with respect to any Yield Maintenance Loan after the related
Yield Maintenance Period will be allocated solely to the Class ________
Certificates.
(III) The Servicer will be entitled to receive as additional
Servicing Compensation amount of any Prepayment Premiums received in any
Collection Period subsequent to the Collection Period related to the EC
Maturity Date.
(IV) Notwithstanding the foregoing, Prepayment Premiums
shall be distributed on any Distribution Date only to the extent they are
received in respect of the Mortgage Loans in the related Collection Period.
(d) The Certificate Balances of the Lower-Tier Regular
Interests will be reduced without distribution on any Distribution Date as a
write-off to the extent of any Realized Losses with respect to such date. Any
such write-offs will be applied to the Lower Tier Regular Interests: first, to
the Class Interest; second, to the Class ________ Interest; third, to the
Class ________ Interest; fourth, to the Class _________ Interest; fifth, to
the Class ___________ Interest; sixth, to the Class __________ Interest;
seventh, to the Class _______ Interest; eighth, to the Class _______ Interest;
and ninth, to the Class _______ Interest and the Class _______ Interest,
pro rata.
The Certificate Balances of the Certificates (other than the Class ______ ,
Class _______ , Class _____ and Class _______ Certificates) will be reduced
without distribution on any Distribution Date, as a write-off, to the extent
that, after allocation of Realized Losses in accordance with the preceding
sentence, the Certificate Balance of any Class of Certificates exceeds the
Certificate Balance of its Related Lower-Tier Regular Interest.
(e) All amounts distributable to a Class of Certificates
pursuant to this Section 4.1 on each Distribution Date shall be allocated pro
rata among the outstanding Certificates in each such Class based on their
respective Percentage Interests. Such distributions shall be made on each
Distribution Date other than the Termination Date to each Certificateholder of
record on the related Record Date by check mailed by first class mail to the
address set forth therefor in the Certificate Register or, provided that such
Certificateholder holds Certificates with an aggregate initial Certificate
Balance, Class ________ Notional Balance or Class _________ Notional Balance
in excess of $________, and shall have provided the Paying Agent with wire
instructions in writing at least ____ Business Days prior to the related
Record Date, by wire
107
transfer of immediately available funds to the account of such
Certificateholder at a bank or other entity located in the United States and
having appropriate facilities therefor. The final distribution on each
Certificate shall be made in like manner, but only upon presentment and
surrender of such Certificate at the office of the Trustee or its agent (which
may be the Paying Agent or the Certificate Registrar acting as such agent)
maintained in the Borough of Manhattan that is specified in the notice to
Certificateholders of such final distribution.
(f) Except as otherwise provided in Section 9.1 with respect
to an Anticipated Termination Date, the Trustee shall, no later than the
__________ day of the month in the month preceding the Distribution Date on
which the final distribution with respect to any Class of Certificates is
expected to be made or such later day as the Trustee becomes aware that the
final distribution with respect to any Class of Certificates is expected to be
made on the succeeding Distribution Date, mail to each Holder of such Class of
Certificates, on such day a notice to the effect that:
(A) the Trustee reasonably expects, based upon
information previously provided to it, that the
final distribution with respect to such Class of
Certificates will be made on such Distribution
Date, but only upon presentation and surrender of
such Certificates at the office of the Trustee
therein specified; and
(B) if such final distribution is made on such
Distribution Date, no interest shall accrue on such
Certificates from and after such Distribution Date;
provided, however, that the Class ____ and Class _______ Certificates shall
remain outstanding until there is no other Class of Certificates or Lower-Tier
Regular Interests outstanding.
Any funds not distributed to any Holder or Holders of
Certificates of such Class on such Distribution Date because of the failure of
such Holder or Holders to tender their Certificates shall, on such
Distribution Date, be set aside and held in trust for the benefit of the
appropriate non-tendering Holder or Holders. If any Certificates as to which
notice has been given pursuant to this Section 4.1(f) shall not have been
surrendered for cancellation within ___ months after the time specified in
such notice, the Trustee shall mail a second notice to the remaining
non-tendering Certificateholders, at their last addresses shown in the
Certificate Register, to surrender their Certificates for cancellation in
order to receive from such funds held the final distribution with respect
thereto. If, within one year after the second notice, any of such Certificates
shall not have been surrendered for cancellation, the Trustee may, directly or
through an agent, take appropriate steps to contact the remaining nontendering
Certificateholders concerning surrender of their Certificates. The costs and
expenses of maintaining such funds in trust and of contacting such
Certificateholders shall be paid out of such funds. If, within two years after
the second notice, any such Certificates shall not have been surrendered for
cancellation, the Paying Agent shall pay to the Trustee all amounts
distributable to the Holders thereof, and the Trustee shall thereafter hold
such amounts for the benefit of such Holders until the earlier of (i) its
termination as Trustee hereunder and the transfer of such amounts to a
successor Trustee and (ii) the termination of the Trust Fund and distribution
of such amounts to the Class __ Certificateholders. No interest shall accrue
or be payable to any
108
Certificateholder on any amount held in trust hereunder or by the Trustee as a
result of such Certificateholder's failure to surrender its Certificate(s) for
final payment thereof in accordance with this Section 4.1(f). Any such amounts
transferred to the Trustee may be invested in Permitted Investments and all
income and gain realized from investment of such funds shall be for the
benefit of the Trustee. In the event the Trustee is permitted or required to
invest any amounts in Permitted Investments under this Agreement, whether in
its capacity as Trustee or in the event of its assumption of the duties of, or
becoming the successor to, the Servicer in accordance with the terms of this
Agreement, it shall invest such amounts in the following Permitted Investments
and priority, in each case only for so long as any such investment shall
continue to be a Permitted Investment: (1) (2) , (3) and (4) if none of
(1)-(3) above are available, Permitted Investments under clause (i) of the
definition of Permitted Investments. The Trustee shall indemnify the related
Certificateholders against any loss incurred in respect of any such Permitted
Investment immediately upon realization of such loss.
(g) Notwithstanding any provision in this Agreement to the
contrary, the aggregate amount distributable to each Class pursuant to this
Section 4.1 shall be reduced by the aggregate amount paid to any Person
pursuant to Section 6.3 or Section 8.5(d), such reduction to be allocated
among such Classes pro rata, based upon the respective amounts so
distributable without taking into account the provision of this Section
4.1(g). Such reduction of amounts otherwise distributable to a Class shall be
allocated first in respect of interest and second in respect of principal. For
purposes of determining Interest Shortfalls and Certificate Balances, the
amount of any such reduction so allocated to a Class shall be deemed to have
been distributed to such Class.
SECTION 4.2. Statements to Rating Agencies and
Certificateholders; Available Information;
Information Furnished to Financial Market
Publisher.
(a) On each Distribution Date, the Trustee shall prepare and
forward by mail to each Rating Agency and each Holder of a Certificate, with
copies to the Depositor, Paying Agent, Servicer and Special Servicer, a
statement as to such distribution setting forth for each Class, as applicable:
(i) Principal Distribution Amount and the amount
allocable to principal included in Pooled Available
Funds;
(ii) The Class Interest Distribution Amount
distributable to such Class and the amount of
Pooled Available Funds allocable thereto, together
with any Class Interest Shortfall allocable to such
Class;
(iii) The amount of any P&I Advances by the Servicer, the
Trustee or the Fiscal Agent included in the amounts
distributed to such Certificateholder;
(iv) The Certificate Balance of each Class of
Certificates after giving effect to the
distribution of amounts in respect of the Pooled
Principal Distribution Amount on such Distribution
Date;
109
(v) Realized Losses and their allocation to the
Certificate Balance of any Class of Certificates;
(vi) The Scheduled Principal Balance of the Mortgage
Loans as of the Due Date preceding such
Distribution Date;
(vii) The number and aggregate principal balance of
Mortgage Loans (A) delinquent ____ month, (B)
delinquent ___ months, (C) delinquent _____ or more
months, (D) as to which foreclosure proceedings
have been commenced and (E) that otherwise
constitute Specially Serviced Mortgage Loans, and,
with respect to each Specially Serviced Mortgage
Loan, the amount of Property Advances made during
the related Collection Period, the amount of the
P&I Advance made on such Distribution Date, the
aggregate amount of Property Advances theretofore
made that remain unreimbursed and the aggregate
amount of P&I Advances theretofore made that remain
unreimbursed;
(viii) With respect to any Mortgage Loan that became an
REO Mortgage Loan during the preceding calendar
month, the principal balance of such Mortgage Loan
as of the date it became an REO Mortgage Loan;
(ix) As of the Due Date preceding such Distribution
Date, as to any REO Property sold during the
related Collection Period, the date on which the
Special Servicer made a Final Recovery
Determination and the amount of the proceeds of
such sale deposited into the Collection Account,
and the aggregate amount of REO Proceeds and Net
REO Proceeds (in each case other than Liquidation
Proceeds) and other revenues collected by the
Special Servicer with respect to each REO Property
during the related Collection Period and credited
to the Collection Account, in each case identifying
such REO Property by name;
(x) The outstanding principal balance of each REO
Mortgage Loan as of the close of business on the
immediately preceding Due Date and the appraised
value of the related REO Property per the most
recent Updated Appraisal obtained;
(xi) The amount of the Servicing Compensation paid to
the Servicer with respect to such Distribution
Date, and the amount of the additional servicing
compensation described in Section 3.12(a) that was
paid to the Servicer with respect to such
Distribution Date;
(xii) The amount of any Special Servicing Fee or
Disposition Fee paid to the Special Servicer with
respect to such Distribution Date; and
(xiii) (A) The amount of Prepayment Premiums, if any,
received during the related Collection Period, and
(B) the amount of Default Interest received
110
during the related Collection Period and the Net
Default Interest for such Distribution Date.
In the case of information furnished pursuant to subclauses
(i), (ii), (iii) and (xiii)(A) above, the amounts shall be expressed as a
dollar amount in the aggregate for all Certificates of each applicable Class
and for each Class of Certificates for a denomination of $______ initial
Certificate Balance or Notional Balance.
Within a reasonable period of time after the end of each
calendar year, the Trustee shall furnish to each Person who at any time during
the calendar year was a Holder of a Certificate (except for a Class or Class
Certificate) and to each Rating Agency a statement containing the information
set forth in subclauses (i) and (ii) above, aggregated for such calendar year
or applicable portion thereof during which such Person was a
Certificateholder. Such obligation of the Trustee shall be deemed to have been
satisfied to the extent that it provided substantially comparable information
pursuant to any requirements of the Code as from time to time in force.
On each Distribution Date, the Trustee shall forward to each
Holder of a Class ____ or Class _____ Certificate a copy of the reports
forwarded to the other Certificateholders on such Distribution Date and a
statement setting forth the amounts, if any, actually distributed with respect
to the Class ______ or Class Certificates ______ on such Distribution Date.
Within a reasonable period of time after the end of each
calendar year, the Trustee shall furnish to each Person who at any time during
the calendar year was a Holder of a Class _____ or Class ______ Certificate a
statement containing the information provided pursuant to the previous
paragraph aggregated for such calendar year or applicable portion thereof
during which such Person was a Certificateholder. Such obligation of the
Trustee shall be deemed to have been satisfied to the extent that it provided
substantially comparable information pursuant to any requirements of the Code
as from time to time in force.
In addition to the reports required to be delivered pursuant
to this Section 4.2(a), the Trustee shall make available upon request to each
proposed transferee of a Privately Placed Certificate such additional
information, if any, in its possession as may be required to permit the
proposed transfer to be effected pursuant to Rule 144A.
(b) On or within ___ Business Days following each
Distribution Date, the Trustee shall prepare and furnish to the Financial
Market Publisher and the Placement Agent, using the format and media mutually
agreed upon by the Trustee, the Financial Market Publisher and the Placement
Agent, the following information regarding each Mortgage Loan and any other
information reasonably requested by the Placement Agent and available to the
Trustee:
(i) an identifying loan number;
(ii) the Mortgage Rate; and
(iii) the principal balance as of such Distribution Date.
111
The Trustee shall only be obligated to deliver the statements, reports and
information contemplated by Section 4.2(a) and 4.2(b) to the extent it
receives the necessary underlying information from the Servicer and shall not
be liable for any failure to deliver any thereof on the prescribed Due Dates,
to the extent such failure is caused by the Servicer's failure to deliver such
underlying information in a timely manner. Nothing herein shall obligate the
Trustee, the Servicer or the Special Servicer to violate (in the reasonable
judgment of the Servicer, the Special Servicer or the Trustee, as appropriate)
any applicable law or provision of any Mortgage Loan document prohibiting
disclosure of information with respect to any Borrower and the failure of the
Trustee, the Servicer or the Special Servicer to disseminate information for
such reason shall not be a breach hereof.
SECTION 4.3. Compliance with Withholding Requirements.
Notwithstanding any other provision of this Agreement, the
Paying Agent shall comply with all federal withholding requirements with
respect to payments to Certificateholders of interest or original issue
discount that the Paying Agent reasonably believes are applicable under the
Code. The consent of Certificateholders shall not be required for any such
withholding. The Paying Agent agrees that it will not withhold with respect to
payments of interest or original issue discount in the case of a
Certificateholder that is a non-U.S. Person that has furnished or caused to be
furnished (i) an effective Form W-8 or Form W-9 or an acceptable substitute
form or a successor form and who has informed the Trustee in writing that it
is not a "10-percent shareholder" within the meaning of Code Section
871(h)(3)(B) or a "controlled foreign corporation" described in Code Section
881(c)(3)(C) with respect to the Trust Fund or the Depositor, or (ii) an
effective Form 4224 or an acceptable substitute form or a successor form. In
the event the Paying Agent or its agent withholds any amount from interest or
original issue discount payments or advances thereof to any Certificateholder
pursuant to federal withholding requirements, the Paying Agent shall indicate
the amount withheld to such Certificateholder. Any amount so withheld shall be
treated as having been distributed to such Certificateholder for all purposes
of this Agreement.
SECTION 4.4. REMIC Compliance.
(a) The parties intend that each of the Upper-Tier REMIC and
the Lower- Tier REMIC shall constitute, and that the affairs of each of the
Upper-Tier REMIC and the Lower-Tier REMIC shall be conducted so as to qualify
it as, a "real estate mortgage investment conduit" as defined in, and in
accordance with, the REMIC Provisions, and the provisions hereof shall be
interpreted consistently with this intention. In furtherance of such
intention, the Trustee shall, to the extent permitted by applicable law, act
as agent, and is hereby appointed to act as agent, of each of the Upper-Tier
REMIC and the Lower-Tier REMIC and shall on behalf of each of the Upper-Tier
REMIC and the Lower-Tier REMIC: (i) prepare, sign and file, or cause to be
prepared and filed, all required Tax Returns for each of the Upper-Tier REMIC
and the Lower-Tier REMIC, using a calendar year as the taxable year for each
of the Upper-Tier REMIC and the Lower-Tier REMIC, when and as required by the
REMIC Provisions and other applicable federal, state or local income tax laws;
(ii) make an election, on behalf of each of the Upper-Tier REMIC and the
Lower-Tier REMIC, to be treated as a REMIC on Form 1066 for its first taxable
year, in accordance with the REMIC Provisions; (iii) prepare
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and forward, or cause to be prepared and forwarded, to the Certificateholders
and the Internal Revenue Service and applicable state and local tax
authorities all information reports as and when required to be provided to
them in accordance with the REMIC Provisions; (iv) if the filing or
distribution of any documents of an administrative nature not addressed in
clauses (i) through (iii) of this Section 4.4 is then required by the REMIC
Provisions in order to maintain the status of the Upper-Tier REMIC or the
Lower-Tier REMIC as a REMIC or is otherwise required by the Code, prepare,
sign and file or distribute, or cause to be prepared and signed and filed or
distributed, such documents with or to such Persons when and as required by
the REMIC Provisions or the Code or comparable provisions of state and local
law; (v) within _____ days of the Closing Date, furnish or cause to be
furnished to the Internal Revenue Service, on Form 8811 or as otherwise may be
required by the Code, the name, title and address of the Person that the
holders of the Certificates may contact for tax information relating thereto
(and the Trustee shall act as the representative of each of the Upper-Tier
REMIC and the Lower-Tier REMIC for this purpose), together with such
additional information as may be required by such Form, and shall update such
information at the time or times and in the manner required by the Code (and
the Depositor agrees within ___ Business Days of the Closing Date, to provide
any information reasonably requested by the Trustee and necessary to make such
filing); and (vi) maintain such records relating to each of the Upper-Tier
REMIC and the Lower-Tier REMIC as may be necessary to prepare the foregoing
returns, schedules, statements or information, such records, for federal
income tax purposes, to be maintained on a calendar year and on an accrual
basis. The Holder of the largest Percentage Interest in the Class _______ or
Class _______ Certificates shall be the tax matters person of the Upper-Tier
REMIC or the Lower-Tier REMIC, respectively, pursuant to Treasury Regulations
Section 1.860F-4(d). If more than one Holder should hold an equal Percentage
Interest in the Class ________ or Class _________ Certificates larger than
that held by any other Holder, the first such Holder to have acquired such
Class _______ or Class ________ Certificates shall be such tax matters person.
The Trustee shall act as attorney-in-fact and agent for the tax matters person
of each of the Upper-Tier REMIC and the Lower-Tier REMIC, and each Holder of a
Percentage Interest in the Class _______ or Class ________ Certificates, by
acceptance thereof, is deemed to have consented to the Trustee's appointment
in such capacity and agrees to execute any documents required to give effect
thereto, and any fees and expenses incurred by the Trustee in connection with
any audit or administrative or judicial proceeding shall be paid by the Trust
Fund. The Trustee shall not intentionally take any action or intentionally
omit to take any action if, in taking or omitting to take such action, the
Trustee knows that such action or omission (as the case may be) would cause
the termination of the REMIC status of the Upper-Tier REMIC or the Lower- Tier
REMIC or the imposition of tax on the Upper-Tier REMIC or the Lower-Tier REMIC
(other than a tax on income expressly permitted or contemplated to be received
by the terms of this Agreement). Notwithstanding any provision of this
paragraph to the contrary, the Trustee shall not be required to take any
action that the Trustee in good faith believes to be inconsistent with any
other provision of this Agreement, nor shall the Trustee be deemed in
violation of this paragraph if it takes any action expressly required or
authorized by any other provision of this Agreement, and the Trustee shall
have no responsibility or liability with respect to any act or omission of the
Depositor or the Servicer or the Special Servicer which causes the Trustee to
be unable to comply with any of clauses (i) through (vi) of the fifth
preceding sentence or which results in any action contemplated by clauses (i)
or (ii) of the next succeeding sentence. In this regard the Trustee shall (i)
exercise reasonable care not to allow the occurrence of any "prohibited
transactions"
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with the meaning of Code Section 860F(a), unless the party seeking such action
shall have delivered to the Trustee an Opinion of Counsel (at such party's
expense) that such occurrence would not (A) result in a taxable gain, (B)
otherwise subject the Upper-Tier REMIC or the Lower-Tier REMIC to tax (other
than a tax at the highest marginal corporate tax rate on net income from
foreclosure property), or (C) cause either the Upper-Tier REMIC or the
Lower-Tier REMIC to fail to qualify as a REMIC; and (ii) exercise reasonable
care not to allow the Trust Fund to receive income from the performance of
services or from assets not permitted under the REMIC Provisions to be held by
a REMIC (provided, however, that the receipt of any income expressly permitted
or contemplated by the terms of this Agreement shall not be deemed to violate
this clause). Neither the Servicer, the Special Servicer nor the Depositor
shall be responsible or liable (except in connection with any act or omission
referred to in the two preceding sentences) for any failure by the Trustee to
comply with the provisions of this Section 4.4. The Depositor, the Special
Servicer and the Servicer shall cooperate in a timely manner with the Trustee
in supplying any information within the Depositor's, the Special Servicer's or
the Servicer's control (other than any confidential information) that is
reasonably necessary to enable the Trustee to perform its duties under this
Section 4.4.
(b) The following assumptions are to be used for purposes of
determining the anticipated payments of principal and interest for calculating
the original yield to maturity and original issue discount with respect to the
Regular Certificates: (i) each Mortgage Loan will pay principal and interest
in accordance with its terms and scheduled payments will be timely received on
their Due Dates, provided that the Mortgage Loans in the aggregate will prepay
in accordance with the Prepayment Assumption; (ii) none of the Servicer, the
Depositor and the Class Certificateholders will exercise the right described
in Section 9.1 of this Agreement to cause early termination of the Trust Fund;
and (iii) no Mortgage Loan is repurchased by the Depositor.
SECTION 4.5. Imposition of Tax on the Trust Fund.
In the event that any tax, including interest, penalties or
assessments, additional amounts or additions to tax, is imposed on the
Upper-Tier REMIC or the Lower- Tier REMIC, such tax shall be charged against
amounts otherwise distributable to the Holders of the Certificates; provided,
that any taxes imposed on any net income from foreclosure property pursuant to
Code Section 860G(d) or any similar tax imposed by a state or local
jurisdiction shall instead be treated as an expense of the related REO
Property in determining Net REO Proceeds with respect to such REO Property
(and until such taxes are paid, the Servicer from time to time shall withdraw
from the Collection Account amounts reasonably determined by the Servicer to
be necessary to pay such taxes, which the Servicer shall maintain in a
separate, non-interest-bearing account, and the Servicer shall deposit in the
Collection Account the excess determined by the Servicer from time to time of
the amount in such account over the amount necessary to pay such taxes) and
shall be paid therefrom. Except as provided in the preceding sentence, the
Trustee is hereby authorized to and shall retain or cause to be retained from
Pooled Available Funds sufficient funds to pay or provide for the payment of,
and to actually pay, such tax as is legally owed by the Upper-Tier REMIC or
the Lower-Tier REMIC (but such authorization shall not prevent the Trustee
from contesting, at the expense of the Trust Fund, any such tax in appropriate
proceedings, and withholding payment of such tax, if permitted by
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law, pending the outcome of such proceedings). The Trustee is hereby
authorized to and shall segregate or cause to be segregated, in a separate
non-interest bearing account, (i) the net income from any "prohibited
transaction" under Code Section 860F(a) or (ii) the amount of any contribution
to the Upper-Tier REMIC or the Lower-Tier REMIC after the Startup Day that is
subject to tax under Code Section 860G(d) and use such income or amount, to
the extent necessary, to pay such tax, such amounts to be segregated from the
Collection Account with respect to any such net income of or contribution to
the Lower-Tier REMIC and from the Distribution Account with respect to any
such net income of or contribution to the Upper-Tier REMIC (and return the
balance thereof, if any, to the Collection Account or the Distribution
Account, as the case may be). To the extent that any such tax is paid to the
Internal Revenue Service, the Trustee shall retain an equal amount from future
amounts otherwise distributable to the Holders of the Class _____ or the Class
_______ Certificates as the case may be, and shall distribute such retained
amounts to the Holders of Regular Certificates or Lower-Tier Regular
Interests, as applicable, until they are fully reimbursed and then to the
Holders of the Class _____ Certificates or the Class ________ Certificates, as
applicable. Neither the Servicer, the Special Servicer nor the Trustee shall
be responsible for any taxes imposed on the Upper-Tier REMIC or the Lower-Tier
REMIC, in either case, except to the extent such tax is attributable to a
breach of a representation or warranty of the Servicer or the Special Servicer
or an act or omission of the Servicer, the Special Servicer or the Trustee in
contravention of this Agreement, provided, further, that such breach, act or
omission could result in liability under Section 6.3 in the case of the
Servicer or Special Servicer or Section 4.4 or 8.1, in the case of the
Trustee. Notwithstanding anything in this Agreement to the contrary, in each
such case, the Servicer and the Special Servicer shall not be responsible for
the Trustee's breaches, acts or omissions, and the Trustee shall not be
responsible for the breaches, acts or omissions of the Servicer or the Special
Servicer.
SECTION 4.6. Remittances; P&I Advances.
(a) For purposes of this Section 4.6, "Applicable Monthly
Payment" shall mean, for any Mortgage Loan with respect to any month, (A) if
such Mortgage Loan is delinquent as to its Balloon Payment (including any
Mortgage Loan as to which the related Mortgaged Property has become an REO
Property and for any month after the related Balloon Payment would have been
due), the related Assumed Scheduled Payment and (B) if such Mortgage Loan is
not described by the preceding clause (including any such Mortgage Loan as to
which the related Mortgaged Property has become an REO Property), the Monthly
Payment.
(b) On the Remittance Date immediately preceding each
Distribution Date, the Servicer shall:
(i) remit to the Trustee from the Collection
Account for deposit in the Distribution Account an amount
equal to the Prepayment Premiums received by the Servicer in
the Collection Period preceding such Remittance Date;
(ii) remit to the Trustee from the Collection
Account for deposit in the Distribution Account an amount
equal to the Pooled Available Funds for such Distribution
Date (excluding P&I Advances); and
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(iii) make an advance, by deposit into the
Collection Account, and remit such amount to the
Distribution Account in an amount equal to the sum of the
Applicable Monthly Payment for each Mortgage Loan, to the
extent such amounts were not received on such Mortgage Loans
as of the close of business on the Business Day immediately
preceding the Remittance Date.
(c) With respect to each Remittance Date, the Servicer shall
determine (a) with respect to each Seriously Delinquent Loan, the excess, if
any, of (x) the sum of the following amounts with respect to such Seriously
Delinquent Loan: (i) the outstanding principal balance thereof that is due and
payable; (ii) the interest portion of any ▇▇▇▇▇▇▇▇▇▇▇▇ ▇&▇ Advances with
respect thereto; (iii) any unreimbursed Property Advances with respect
thereto; and (iv) any currently due and payable or delinquent property taxes
with respect thereto over (y) the appraised value (as reflected in the related
Updated Appraisal) thereof and (b) the sum of all amounts described in clause
(a) (such sum, the "Anticipated Loss"). Notwithstanding Section 4.6(b)(iii),
with respect to any Remittance Date, the Servicer shall make a P&I Advance
with respect to any Seriously Delinquent Loan only to the extent that Pooled
Available Funds for the related Distribution Date (exclusive of any P&I
Advance with respect to any Seriously Delinquent Loans) are insufficient to
make distributions to all Classes of Lower-Tier Regular Interests and all
Classes of Certificates pursuant to Section 4.1(a)(I) and Section 4.1(b)(I),
respectively, other than, in each case, the most subordinate Class then
outstanding and any other Class as to which the aggregate of the Certificate
Balances of all Classes subordinate to such Class does not equal or exceed the
Anticipated Loss. In the event that, with respect to any Remittance Date, more
than one Mortgage Loan is a Seriously Delinquent Loan, the Servicer shall
designate on its records the specific Seriously Delinquent Loans as to which
any P&I Advance shall be deemed to have been made. Any such designation of P&I
Advances to specific Seriously Delinquent Loans shall be made, first, among
Seriously Delinquent Loans (excluding any REO Mortgage Loans) as to which the
related Borrower is delinquent only in the payment of Monthly Payments;
second, among Seriously Delinquent Loans (excluding REO Mortgage Loans) as to
which the related Borrower is delinquent in the payment of a Balloon Payment;
and third, among Seriously Delinquent Loans that are REO Mortgage Loans;
provided, however, that any such designation shall be made first to those
Seriously Delinquent Loans in respect of which the Servicer reasonably
determines that such P&I Advance is most likely to be recoverable.
(d) Any amount advanced by the Servicer pursuant to Section
4.6(b)(iii) shall constitute a P&I Advance for all purposes of this Agreement
and the Servicer shall be entitled to reimbursement thereof pursuant to
3.6(ii). The Servicer shall further be entitled to Advance Interest Amounts
accrued on the amount of any such P&I Advance at the Advance Rate and shall be
entitled to payment or reimbursement thereof pursuant to 3.6(iii).
(e) If, as of 5:00 p.m., New York City time, on any
Remittance Date the Servicer shall not (i) have made the P&I Advance required
to have been made on such date pursuant to Section 4.6(b)(iii) or (ii)
delivered the certificate and documentation related to a determination of
nonrecoverability, the Trustee shall immediately notify the Fiscal Agent by
telephone promptly confirmed in writing, and the Trustee shall no later than
10:00 a.m., New York City time, on such Distribution Date deposit into the
Distribution Account in immediately
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available funds an amount equal to the P&I Advances otherwise required to have
been made by the Servicer. If the Trustee fails to make any P&I Advance
required to be made under this Section 4.6, the Fiscal Agent shall make such
P&I Advance not later than 11:00 a.m., New York City time, on such
Distribution Date and, thereby, the Trustee shall not be in default under this
Agreement.
(f) Anything to the contrary in this Agreement
notwithstanding, none of the Servicer, the Trustee or the Fiscal Agent shall
be obligated to make a P&I Advance as to any Monthly Payment or Assumed
Scheduled Payment on any date on which a P&I Advance is otherwise required to
be made by this Section 4.6 if the Servicer, the Trustee or the Fiscal Agent,
as applicable, determines that such advance will be a Nonrecoverable Advance.
The Trustee and the Fiscal Agent shall be entitled to rely, conclusively, on
any determination by the Servicer that a P&I Advance, if made, would be a
Nonrecoverable Advance. The Trustee and the Fiscal Agent, in determining
whether or not a P&I Advance previously made is, or a proposed P&I Advance, if
made, would be, a Nonrecoverable Advance shall be subject to the standards
applicable to the Servicer hereunder.
(g) The Servicer, the Trustee or the Fiscal Agent, as
applicable, shall be entitled to, and hereby covenants and agrees to promptly
seek and effect, the reimbursement of P&I Advances it makes to the extent
permitted pursuant to Section 3.6(ii) of this Agreement together with any
related Advance Interest Amount in respect of such P&I Advances to the extent
permitted pursuant to Section 3.6(iii).
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ARTICLE V
THE CERTIFICATES
SECTION 5.1. The Certificates.
The Certificates consist of the Class Certificates,
[The Certificates of each Class will be issuable in
definitive physical form only, registered in the name of the holders thereof;
provided, however, that in accordance with Section 5.3 beneficial ownership
interests in the Certificates shall initially be represented by Book-Entry
Certificates held and transferred through the book-entry facilities of the
Securities Depository, in minimum denominations of authorized initial
Certificate Balance or notional amount (except with respect to the Class
________ and Class ______ Certificates), as described in the succeeding table.
The Book-Entry Certificates shall be in minimum denominations of $ _______ and
multiples of $ in excess thereof and the Certificates other than Book-Entry
Certificates shall be in minimum denominations of $ __________________ and
multiples of $ ______________ in excess thereof, except one Certificate of
each such Class may be issued which represents a different initial Certificate
Balance or Notional Balance to accommodate the remainder of the initial
Certificate Balance or related Notional amount. Each Certificate will share
ratably in all rights of the related Class. The Class ________ and ________
Certificates shall each be issuable in one or more registered, definitive
physical certificates in minimum denominations of __% Percentage Interests and
integral multiples of a __% Percentage Interest in excess thereof and together
aggregating the entire ___% Percentage Interest in each such Class.
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Aggregate Denominations
of all Certificates of Class
Minimum (in initial Certificate Balance or
Class Denomination initial Notional Balance)
Any of the Certificates may be issued with appropriate
insertions, omissions, substitutions and variations, and may have imprinted or
otherwise reproduced thereon such legend or legends, not inconsistent with the
provisions of this Agreement, as may be required to comply with any law or
with rules or regulations pursuant thereto, or with the rules of any
securities market in which the Certificates are admitted to trading, or to
conform to general usage.
Each Certificate may be printed or in typewritten or similar
form, and each Certificate shall, upon original issue, be executed and
authenticated by the Trustee or the Authenticating Agent and delivered to the
Depositor. All Certificates shall be executed by manual or facsimile signature
on behalf of the Trustee or Authenticating Agent by an authorized officer or
signatory. Certificates bearing the signature of an individual who was at any
time the proper officer or signatory of the Trustee or Authenticating Agent
shall bind the Trustee or Authenticating Agent, notwithstanding that such
individual has ceased to hold such office or position prior to the delivery of
such Certificates or did not hold such office or position at the date of such
Certificates. No Certificate shall be entitled to any benefit under this
Agreement, or be valid for any purpose, unless there appears on such
Certificate a certificate of authentication in the form set forth in Exhibits
A-1 through A-14 executed by the Authenticating Agent by manual signature, and
such certificate of authentication upon any Certificate shall be conclusive
evidence, and the only evidence, that such Certificate has been duly
authenticated and delivered hereunder. All Certificates shall be dated the
date of their authentication.
SECTION 5.2. Registration, Transfer and Exchange of
Certificates.
(a) The Trustee shall keep or cause to be kept at the
Corporate Trust Office books (the "Certificate Register") for the
registration, transfer and exchange of Certificates (the Trustee, in such
capacity, being the "Certificate Registrar"). The names and addresses of all
Certificateholders and the names and addresses of the transferees of any
Certificates shall be registered in the Certificate Register. The Person in
whose name any Certificate is so registered shall be deemed and treated as the
sole owner and Holder thereof for all purposes of this Agreement and the
Certificate Registrar, the Servicer, the Special Servicer, the Trustee, any
Paying Agent and any agent of any of them shall not be affected by any notice
or knowledge to the contrary. An Individual Certificate is transferable or
exchangeable only upon the surrender of such Certificate to the Certificate
Registrar at the Corporate Trust Office together with an assignment and
transfer (executed by the Holder or his duly authorized attorney), subject to
the
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requirements of Section 5.2(c), (d), (e) and (f). Upon request of the Trustee,
the Certificate Registrar shall provide the Trustee with the names, addresses
and Percentage Interests of the Holders.
(b) Upon surrender for registration of transfer of any
Individual Certificate, subject to the requirements of Section 5.2(c), (d),
(e) and (f), the Trustee shall execute and the Authenticating Agent shall duly
authenticate in the name of the designated transferee or transferees, one or
more new Certificates in authorized denominations of a like aggregate
Certificate Balance. Such Certificates shall be delivered by the Certificate
Registrar in accordance with Section 5.2(e). Each Certificate surrendered for
registration of transfer shall be cancelled and subsequently destroyed by the
Certificate Registrar. Each new Certificate issued pursuant to this Section
5.2 shall be registered in the name of any Person as the transferring Holder
may request, subject to the provisions of Section 5.2(c), (d), (e) and (f).
(c) The exchange, transfer and registration of transfer of
Individual Certificates that are Privately Placed Certificates shall be
subject to the restrictions set forth below (in addition to the provisions of
Section 5.2(d), (e) and (f)):
(i) The Certificate Registrar shall register the
transfer of an Individual Certificate that is a
Privately Placed Certificate if the requested
transfer is being made to a transferee who has
provided the Certificate Registrar with an
Investment Representation Letter substantially in
the form of Exhibit D-1 hereto (an "Investment
Representation Letter"), to the effect that the
transfer is being made to a Qualified Institutional
Buyer in accordance with Rule 144A; or
(ii) The Certificate Registrar shall register the
transfer of an Individual Certificate that is a
Privately Placed Certificate (other than a Class
or Class Certificate), if prior to the transfer,
the transferee furnishes to the Certificate
Registrar (1) an Investment Representation Letter
to the effect that the transfer is being made to an
Institutional Accredited Investor in accordance
with an applicable exemption under the Act, (2) an
Opinion of Counsel acceptable to the Certificate
Registrar that such transfer is in compliance with
the Act, and (3) a written undertaking by the
transferor to reimburse the Trust for any costs
incurred by it in connection with the proposed
transfer. In addition, the Certificate Registrar
may, as a condition of the registration of any such
transfer, require the transferor to furnish such
other certificates, legal opinions or other
information (at the transferor's expense) as the
Certificate Registrar may reasonably require to
confirm that the proposed transfer is being made
pursuant to an exemption from, or in a transaction
not subject to, the registration requirements of
the Act and other applicable laws.
(d) Subject to the restrictions on transfer and exchange set
forth in this Section 5.2, the Holder of one or more Certificates may transfer
or exchange the same in whole or in part (with a Certificate Balance equal to
any authorized denomination) by surrendering such
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Certificate at the Corporate Trust Office or at the office of any transfer
agent appointed as provided under this Agreement, together with an instrument
of assignment or transfer (executed by the Holder or its duly authorized
attorney), in the case of transfer, and a written request for exchange in the
case of exchange. Subject to the restrictions on transfer set forth in this
Section 5.2, following a proper request for transfer or exchange, the
Certificate Registrar shall, within ____ Business Days of such request if made
at the Corporate Trust Office, or within ___ Business Days if made at the
office of a transfer agent (other than the Certificate Registrar), execute and
deliver at the Corporate Trust Office or at the office of such transfer agent,
as the case may be, to the transferee (in the case of transfer) or the Holder
(in the case of exchange) or send by first class mail (at the risk of the
transferee in the case of transfer or the Holder in the case of exchange) to
such address as the transferee or the Holder, as applicable, may request, an
Individual Certificate or Certificates, as the case may require, for a like
aggregate Certificate Balance and in such authorized denomination or
denominations as may be requested. The presentation for transfer or exchange
of any Individual Certificate shall not be valid unless made at the Corporate
Trust Office or at the office of a transfer agent by the registered Holder in
person, or by a duly authorized attorney-in-fact. The Certificate Registrar
may decline to accept any request for an exchange or registration of transfer
of any Certificate during the period of ___ days preceding any Distribution
Date.
(e) Individual Certificates may only be transferred to
Eligible Investors as described herein. In the event the Certificate Registrar
shall determine that an Individual Certificate is being held by or for the
benefit of a Person who is not an Eligible Investor, or that such holding is
unlawful under the laws of a relevant jurisdiction, then the Certificate
Registrar shall void such transfer, if permitted under applicable law.
(f) No fee or service charge shall be imposed by the
Certificate Registrar for its services in respect of any registration of
transfer or exchange referred to in this Section 5.2 other than for transfers
to Institutional Accredited Investors, as provided herein. In connection with
any transfer to an Institutional Accredited Investor, the transferor shall
reimburse the Trust for any costs (including the cost of the Certificate
Registrar's counsel's review of the documents and any legal opinions submitted
by the transferor or transferee to the Certificate Registrar as provided
herein) incurred by the Certificate Registrar in connection with such
transfer. The Certificate Registrar may require payment by each transferor of
a sum sufficient to cover any tax, expense or other governmental charge
payable in connection with any such transfer.
(g) Subject to Section 5.2(d), transfers of the Class _______
and Class _______ Certificates may be made only in accordance with this Section
5.2(g). The Certificate Registrar shall register the transfer of a Class
______ or Class __________ Certificate if (x) the transferor has advised the
Certificate Registrar in writing that the Certificate is being transferred to
a Qualified Institutional Buyer; and (y) prior to transfer the transferor
furnishes to the Certificate Registrar an Investment Representation Letter. In
addition, the Certificate Registrar may, as a condition of the registration of
any such transfer, require the transferor to furnish such other
certifications, legal opinions or other information (at the transferor's
expense) as they may reasonably be required to confirm that the proposed
transfer is being made pursuant to an exemption from, or in a transaction not
subject to, the registration requirements of the Act and other applicable
laws.
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(h) Neither the Depositor, the Servicer, the Special
Servicer, the Trustee nor the Certificate Registrar is obligated to register
or qualify any Class of Certificates under the Act or any other securities law
or to take any action not otherwise required under this Agreement to permit
the transfer of such Certificates without registration or qualification. Any
Certificateholder desiring to effect such transfer shall, and does hereby
agree to, indemnify the Depositor, the Servicer, the Special Servicer, the
Trustee and the Certificate Registrar, against any loss, liability or expense
that may result if the transfer is not exempt from the registration
requirements of the Act or is not made in accordance with such federal and
state laws.
(i) No transfer of any Ownership Interest in a Subordinate
Certificate shall be made to (i) an employee benefit plan subject to the
fiduciary responsibility provisions of ERISA, or Section 4975 of the Code, or
a governmental plan subject to any federal, state or local law ("Similar
Law"), which is to a material extent, similar to the foregoing provisions of
ERISA or the Code (collectively, a "Plan") or (ii) an insurance company that
is using the assets of any insurance company separate account or general
account in which the assets of any such Plan are invested (or which are deemed
pursuant to ERISA or any Similar Law to include assets of Plans) to acquire
any such Subordinate Certificates, other than using assets of its general
account in circumstances whereby such transfer and the subsequent holding of
the Certificate would not constitute or result in a prohibited transaction
within the meaning of Section 406 or 407 of ERISA, Section 4975 of the Code,
or any Similar Law. Each prospective transferee of a Subordinate Certificate
is shall deliver to the Depositor, the Certificate Registrar and the Trustee,
(a) a transfer or representation letter, substantially in the form of Exhibit
D-2 hereto, stating that the prospective transferee is not a Person referred
to in (i) or (ii) above, or (b) an Opinion of Counsel which establishes to the
satisfaction of the Depositor, the Trustee and the Certificate Registrar that
the purchase or holding of the Subordinate Certificate will not result in the
assets of the Trust Fund being deemed to be "plan assets" and subject to the
fiduciary responsibility or prohibited transaction provisions of ERISA, the
Code, or any Similar Law will not constitute or result in a prohibited
transaction within the meaning of Section 406 or Section 407 of ERISA or
Section 4975 of the Code, and will not subject the Servicer, the Special
Servicer, the Depositor, the Trustee or the Certificate Registrar to any
obligation or liability (including obligations or liabilities under ERISA or
Section 4975 of the Code), which Opinion of Counsel shall not be an expense of
the Trustee, the Trust Fund, the Servicer, the Special Servicer, Certificate
Registrar or the Depositor. Neither the Trustee, the Servicer, the Special
Servicer, nor the Certificate Registrar will register a Class __ or Class __
Certificate in any Person's name unless such Person has provided the letter
referred to in clause (a) above. Any transfer of a Subordinate Certificate
that would violate, or result in a prohibited transaction under, ERISA or
Section 4975 of the Code shall be deemed absolutely null and void ab initio.
(j) Each Person who has or acquires any Ownership Interest in a Class ________
Certificate or a Class _________ Certificate shall be deemed by the acceptance
or acquisition of such Ownership Interest to have agreed to be bound by the
following provisions, and the rights of each Person acquiring any Ownership
Interest in a Class __ Certificate or a Class __ Certificate are expressly
subject to the following provisions:
(i) Each Person acquiring or holding any Ownership
Interest in a Class Certificate or a Class
Certificate shall be a Permitted Transferee and
shall not acquire or hold such Ownership Interest as
agent (including as
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a broker, nominee or other middleman) on behalf of
any Person that is not a Permitted Transferee. Any
such Person shall promptly notify the Certificate
Registrar of any change or impending change in its
status (or the status of the beneficial owner of
such Ownership Interest) as a Permitted Transferee.
Any acquisition described in the first sentence of
this Section 5.2(j)(i) by a Person who is not a
Permitted Transferee or by a Person who is acting
as an agent of a Person who is not a Permitted
Transferee shall be void and of no effect, and the
immediately preceding owner who was a Permitted
Transferee shall be restored to registered and
beneficial ownership of the Ownership Interest as
fully as possible.
(ii) No Ownership Interest in a Class _____ Certificate
or a Class ____ Certificate may be transferred, and
no such Transfer shall be registered in the
Certificate Register, without the express written
consent of the Certificate Registrar, and the
Certificate Registrar shall not recognize a
proposed Transfer, and such proposed Transfer shall
not be effective, without such consent with respect
thereto. In connection with any proposed Transfer
of any Ownership Interest in a Class ___
Certificate or a Class _____ Certificate, the
Certificate Registrar shall, as a condition to such
consent, (x) require delivery to it in form and
substance satisfactory to it, and the proposed
transferee shall deliver to the Certificate
Registrar and to the proposed transferor, an
affidavit in substantially the form attached as
Exhibit ____ (a "Transferee Affidavit ") (A) that
such proposed transferee is a Permitted Transferee
and (B) stating that (i) the proposed transferee
historically has paid its debts as they have come
due and intends to do so in the future, (ii) the
proposed transferee understands that, as the holder
of an Ownership Interest in a Class ____
Certificate or a Class _____ Certificate, as
applicable , it may incur liabilities in excess of
cash flows generated by the residual interest,
(iii) the proposed transferee intends to pay taxes
associated with holding the Ownership Interest as
they become due, (iv) the proposed transferee will
not transfer the Ownership Interest to any Person
that does not provide a Transferee Affidavit or as
to which the proposed transferee has actual
knowledge that such Person is not a Permitted
Transferee or is acting as an agent (including as a
broker, nominee or other middleman) for a Person
that is not a Permitted Transferee, and (v) the
proposed transferee expressly agrees to be bound by
and to abide by the provisions of this Section
5.2(j) and (y) other than in connection with the
initial issuance of the Class _____ and Class
_________ Certificates, require a statement from
the proposed transferor substantially in the form
attached as Exhibit (the "Transferor Letter"), that
the proposed transferor has no actual knowledge
that the proposed transferee is not a Permitted
Transferee and has no actual knowledge or reason to
know that the proposed transferee's statements in
the preceding clauses (x)(B)(i) or (iii) are false.
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(iii) Notwithstanding the delivery of a Transferee
Affidavit by a proposed transferee under clause
(ii) above, if a Responsible Officer of the
Certificate Registrar has actual knowledge that the
proposed transferee is not a Permitted Transferee,
no Transfer to such proposed transferee shall be
effected and such proposed Transfer shall not be
registered on the Certificate Register; provided,
however, that the Certificate Registrar shall not
be required to conduct any independent
investigation to determine whether a proposed
transferee is a Permitted Transferee.
Upon notice to the Certificate Registrar that there has
occurred a Transfer to any Person that is a Disqualified Organization or an
agent thereof (including a broker, nominee, or middleman) in contravention of
the foregoing restrictions, and in any event not later than ___ days after a
request for information from the transferor of such Ownership Interest in a
Class Certificate or a Class Certificate, or such agent thereof, the
Certificate Registrar and the Trustee agree to furnish to the IRS and the
transferor of such Ownership Interest or such agent thereof such information
necessary to the application of Section 860E(e) of the Code as may be required
by the Code, including, but not limited to, the present value of the total
anticipated excess inclusions with respect to such Class
or Class Certificate (or portion thereof) for periods after such Transfer.
At the election of the Certificate Registrar and the Trustee, the Certificate
Registrar and the Trustee may charge a reasonable fee for computing and
furnishing such information to the transferor or to such agent thereof
referred to above; provided, however, that such Persons shall in no event be
excused from furnishing such information.
SECTION 5.3.
Book-Entry Certificates.
(a) The Class ________ Certificates, the Class _______
Certificates, the Class ________ Certificates, the Class B Certificates, the
Class _________ Certificates, the Class ________ Certificates, the Class
_________ Certificates and the Class _______ Certificates shall, in the case of
each such Class, initially be issued as one or more Book-Entry Certificates
registered in the name of the Securities Depository or its nominees and,
except as provided in subsection (c) below, transfer of such Certificates may
not be registered by the Certificate Registrar unless such transfer is to a
successor Securities Depository that agrees to hold such Certificates for the
respective Certificate Owners with Ownership Interests therein. Such
Certificate Owners shall hold and transfer their respective Ownership Interest
in and to such Certificates through the book-entry facilities of the
Securities Depository and, except as provided in subsection (c) below, shall
not be entitled to definitive, fully registered Certificates ("Definitive
Certificates") in respect of such Ownership Interests. All transfers by
Certificate Owners of their respective Ownership Interests in the Book-Entry
Certificates shall be made in accordance with the procedures established by
the Securities Depository Participant or brokerage firm representing each such
Certificate Owner. Each Securities Depository Participant shall only transfer
the Ownership Interests in the Book-Entry Certificates of Certificate Owners
it represents or of brokerage firms for which it acts as agent in accordance
with the Securities Depository's normal procedures. Neither the Certificate
Registrar nor the Trustee shall have any responsibility to monitor or restrict
the transfer of
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Ownership Interests in Book-Entry Certificates through the book-entry facilities
of the Securities Depository.
(b) The Trustee, the Servicer, the Special Servicer, the
Fiscal Agent and the Certificate Registrar may for all purposes, including the
making of payments due on the Book-Entry Certificates, deal with the
Securities Depository as the authorized representative of the Certificate
Owners with respect to such Certificates for the purposes of exercising the
rights of Certificateholders hereunder. The rights of Certificate Owners with
respect to the Book-Entry Certificates shall be limited to those established
by law and agreements between such Certificate Owners and the Securities
Depository Participants and brokerage firms representing such Certificate
Owners. Multiple requests and directions from, and votes of, the Securities
Depository as Holder of the Book-Entry Certificates with respect to any
particular matter shall not be deemed inconsistent if they are made with
respect to different Certificate Owners. The Trustee may establish a
reasonable record date in connection with solicitations of consents from or
voting by Certificateholders and shall give notice to the Securities
Depository of such record date.
(c) If (i)(A) the Depositor advises the Trustee and the
Certificate Registrar in writing that the Securities Depository is no longer
willing or able to properly discharge its responsibilities with respect to any
Class of the Book-Entry Certificates, and (B) the Depositor is unable to
locate a qualified successor, or (ii) the Depositor at its option advises the
Trustee and the Certificate Registrar in writing that it elects to terminate
the book-entry system through the Securities Depository with respect to any
Class of the Book-Entry Certificates, the Certificate Registrar shall notify
all affected Certificate Owners, through the Securities Depository, of the
occurrence of any such event and of the availability of Definitive
Certificates to such Certificate Owners requesting the same. Upon surrender to
the Certificate Registrar of any Class of the Book-Entry Certificates by the
Securities Depository, accompanied by registration instructions from the
Securities Depository for registration of transfer, the Trustee shall execute,
and the Certificate Registrar shall authenticate and deliver, the Definitive
Certificates to the Certificate Owners identified in such instructions. None
of the Depositor, the Servicer, the Special Servicer, the Trustee, the Fiscal
Agent or the Certificate Registrar shall be liable for any delay in delivery
of such instructions and may conclusively rely on, and shall be protected in
relying on, such instructions. Upon the issuance of Definitive Certificates
for purposes of evidencing ownership of any of the Class _____ Certificates,
the Class Certificates, the Class ______ Certificates, the Class ______
Certificates, the Class _______ Certificates, the Class ________ Certificates,
the Class ______ Certificates and the Class __________ Certificates, the
registered holders of such Definitive Certificates shall be recognized as
Certificateholders hereunder and, accordingly, shall be entitled directly to
receive payments on, to exercise Voting Rights with respect to, and to
transfer and exchange such Definitive Certificates.
SECTION 5.4. Mutilated, Destroyed, Lost or Stolen
Certificates.
If (i) any mutilated Certificate is surrendered to the
Certificate Registrar, or the Certificate Registrar receives evidence to its
satisfaction of the destruction, loss or theft of any Certificate, and (ii)
there is delivered to the Certificate Registrar such security or indemnity as
may be requited by it to save it, be Trustee and the Servicer harmless, then,
in the absence of
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actual knowledge by a Responsible Officer of the Certificate
Registrar that such Certificate has been acquired by a bona fide purchaser,
the Trustee or the Authenticating Agent shall execute and authenticate and the
Certificate Registrar shall deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Certificate, a new Certificate of the
same Class and of like tenor and Percentage Interest. Upon the issuance of any
new Certificate under this Section 5.4, the Certificate Registrar may require
the payment of a sum sufficient to cover any tax or other governmental charge
that may be imposed in relation thereto and any other expenses (including the
fees and expenses of the Certificate Registrar) connected therewith. Any
replacement Certificate issued pursuant to this Section 5.4 shall constitute
complete and indefeasible evidence of ownership of the corresponding interest
in the Trust Fund, as if originally issued, whether or not the lost, stolen or
destroyed Certificate shall be found at any time.
SECTION 5.5. Appointment of Paying Agent.
The Trustee may appoint a paying agent for the purpose of
making distributions to Certificateholders pursuant to Section 4.1. The
Trustee shall cause such Paying Agent, if other than the Trustee or the
Servicer, to execute and deliver to the Servicer and the Trustee an instrument
in which such Paying Agent shall agree with the Servicer and the Trustee that
such Paying Agent will hold all sums held by it for payment to
Certificateholders in trust for the benefit of the Certificateholders entitled
thereto until such sums have been paid to such Certificateholders or disposed
of as otherwise provided herein. The initial Paying Agent shall be the
Trustee. The Paying Agent shall at all times be an entity having a long-term
unsecured debt rating of at least "BBB" by each Rating Agency, unless each of
the Rating Agencies has confirmed in writing that a lower rating shall not
result, in and of itself, in a downgrading, withdrawal or qualification of the
rating then assigned by such Rating Agency to any Class of the Certificates.
SECTION 5.6. Access to Certificateholders' Names and
Addresses.
(a) If any Certificateholder (for purposes of this Section
5.6, an "Applicant") applies in writing to the Certificate Registrar, and such
application states that the Applicant desires to communicate with other
Certificateholders with respect to their rights under this Agreement or under
the Certificates and is accompanied by a copy of the communication which such
Applicant proposes to transmit, then the Certificate Registrar shall, at the
expense of such Applicant, within ___ Business Days after the receipt of such
application, transmit such communication to the Certificateholders as of the
most recent Record Date; provided, however, if such communication relates to
performance by the Servicer, the Special Servicer or the Trustee of its duties
hereunder, the Certificate Registrar shall furnish or cause to be furnished to
such Applicant a list of the names and addresses of the Certificateholders as
of the most recent Record Date.
(b) Every Certificateholder, by receiving and holding its
Certificate, agrees with the Trustee that the Trustee and the Certificate
Registrar shall not be held accountable in any way by reason of the disclosure
of any information as to the names and addresses of the Certificateholders
hereunder, regardless of the source from which such information was derived.
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SECTION 5.7. Actions of Certificateholders.
(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Agreement to be given or
taken by Certificateholders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Certificateholders
in person or by an agent duly appointed in writing; and except as herein
otherwise expressly provided, such action shall become effective when such
instrument or instruments are delivered to the Trustee and, when required, to
the Depositor, the Special Servicer or the Servicer. Proof of execution of any
such instrument or of a writing appointing any such agent shall be sufficient
for any purpose of this Agreement and conclusive in favor of the Trustee, the
Depositor, the Special Servicer and the Servicer, if made in the manner
provided in this Section.
(b) The fact and date of the execution by any
Certificateholder of any such instrument or writing may be proved in any
reasonable manner which the Trustee deems sufficient.
(c) Any request, demand, authorization, direction, notice,
consent, waiver or other act by a Certificateholder shall bind every Holder of
every Certificate issued upon the registration of transfer thereof or in
exchange therefor or in lieu thereof, in respect of anything done, or omitted
to be done, by the Trustee, the Depositor, the Special Servicer or the
Servicer in reliance thereon, whether or not notation of such action is made
upon such Certificate.
(d) The Trustee or Certificate Registrar may require such
additional proof of any matter referred to in this Section 5.7 as it shall
deem necessary.
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ARTICLE VI
THE DEPOSITOR, THE SERVICER AND THE SPECIAL SERVICER
SECTION 6.1. Liability of the Depositor, the Servicer and
the Special Servicer.
The Depositor, the Servicer and the Special Servicer each
shall be liable in accordance herewith only to the extent of the obligations
specifically imposed by this Agreement.
SECTION 6.2. Merger or Consolidation of the Servicer and
Special Servicer.
Subject to the third paragraph of this Section 6.2, the
Servicer will keep in full effect its existence, rights and good standing as a
____________ ___________ under the laws of the State of __________ and will not
jeopardize its ability to do business in each jurisdiction in which one or
more of the Mortgaged Properties are located or to protect the validity and
enforceability of this Agreement, the Certificates or any of the Mortgage
Loans and to perform its respective duties under this Agreement.
Subject to the following paragraph, the Special Servicer
will keep in full effect its existence, rights and good standing as a
corporation under the laws of the State of Florida and will not jeopardize its
ability to do business in each jurisdiction in which one or more of the
Mortgaged Properties are located or to protect the validity and enforceability
of this Agreement, the Certificates or any of the Specially Serviced Mortgage
Loans and to perform its respective duties under this Agreement.
Each of the Servicer and the Special Servicer may be merged
or consolidated with or into any Person, or transfer all or substantially all
of its assets to any Person, in which case any Person resulting from any
merger or consolidation to which it shall be a party, or any Person succeeding
to its business, shall be the successor of the Servicer or the Special
Servicer, as applicable hereunder, and shall be deemed to have assumed all of
the liabilities of the Servicer or the Special Servicer, as applicable
hereunder, if each of the Rating Agencies has confirmed in writing that such
merger, consolidation or transfer and succession shall not result, in and of
itself, in a downgrading, withdrawal or qualification of the rating then
assigned by such Rating Agency to any Class of Certificates.
SECTION 6.3. Limitation on Liability of the Depositor,
the Servicer and Others.
Neither the Depositor, the Servicer, the Special Servicer,
the Extension Advisor nor any of the directors, officers, employees or agents
of the Depositor or the Servicer or the Special Servicer or the Extension
Advisor (or any general partner of the Servicer or, if applicable, the Special
Servicer or the Extension Advisor) shall be under any liability to the Trust
Fund or the Certificateholders for any action taken, or for refraining
from the taking of any action, in good faith pursuant to this Agreement, or
for errors in judgment; provided, however, that this provision shall not
protect the Depositor or the Servicer or the Special
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Servicer or any Extension Advisor or any such Person against any breach of
warranties or representations made herein, or against any specific liability
imposed on the Servicer or the Special Servicer or any Extension Advisor for a
breach of the Servicing Standard, or against any liability which would
otherwise be imposed by reason of its respective willful misfeasance, bad
faith, fraud or negligence in the performance of its duties or by reason of
reckless disregard of its respective obligations or duties hereunder. The
Depositor, the Servicer, the Special Servicer and any Extension Advisor and
any director, officer, employee or agent of the Depositor, the Servicer, the
Special Servicer and any Extension Advisor (or the general partner of the
Servicer or, if applicable, the Special Servicer or any Extension Advisor) may
rely in good faith on any document of any kind which, prima facie, is properly
executed and submitted by any appropriate Person with respect to any matters
arising hereunder. The Depositor, the Servicer, the Special Servicer and any
Extension Advisor and any director, officer, employee or agent of the
Depositor, the Servicer or the Special Servicer or any Extension Advisor (or
the general partner of the Servicer or, if applicable, the Special Servicer or
any Extension Advisor) shall be indemnified and held harmless by the Trust
Fund against any loss, liability or expense incurred in connection with any
legal action relating to this Agreement or the Certificates, other than any
loss, liability or expense (i) incurred by reason of its respective willful
misfeasance, bad faith, fraud or negligence or (in the case of the Servicer or
Special Servicer or any Extension Advisor) a breach of the Servicing Standard
in the performance of its respective duties or by reason of reckless disregard
of its respective obligations or duties hereunder; or (ii) imposed by any
taxing authority which loss, liability or expense is not specifically
reimbursable pursuant to the terms of this Agreement or which results from a
breach (other than a breach with respect to which the Servicer or Special
Servicer or any Extension Advisor, as applicable, would have no liability
under the standard set forth in the first sentence of this paragraph) by the
Servicer, the Special Servicer, the Extension Advisor or the agents of any of
them of its obligations hereunder. Neither the Depositor nor the Servicer nor
the Special Servicer shall be under any obligation to appear in, prosecute or
defend any legal action unless such action is related to its respective duties
under this Agreement and in its opinion does not expose it to any expense or
liability; provided, however, that the Depositor or the Servicer or the
Special Servicer or any Extension Advisor may in its discretion undertake any
action related to its obligations hereunder which it may deem necessary or
desirable with respect to this Agreement and the rights and duties of the
parties hereto and the interests of the Certificateholders hereunder. In such
event, the legal expenses and costs of such action and any liability resulting
therefrom (except any liability related to the Servicer's or the Special
Servicer's obligations under Section 3.1(a)) shall be expenses, costs and
liabilities of the Trust Fund, and the Depositor, the Servicer and the Special
Servicer shall be entitled to be reimbursed therefor from the Collection
Account as provided in Section 3.6(vi) of this Agreement.
SECTION 6.4. Limitation on Resignation of the Servicer and
of the Special Servicer.
Each of the Servicer and the Special Servicer may assign its
respective rights and delegate its respective duties and obligations under
this Agreement in connection with the sale or transfer of a substantial
portion of its mortgage servicing or asset management portfolio, provided
that: (i) the purchaser or transferee accepting such assignment and delegation
(A) shall be satisfactory to the Trustee, (B) shall be (I) an established
mortgage finance institution, bank
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or mortgage servicing institution, organized and doing business under the laws
of any state of the United States or the District of Columbia, authorized
under such laws to perform the duties of a servicer of mortgage loans or (II)
a Person resulting from a merger, consolidation or succession that is
permitted under Section 6.2, and (C) shall execute and deliver to the Trustee
an agreement, in form and substance reasonably satisfactory to the Trustee,
which contains an assumption by such Person of the due and punctual
performance and observance of each covenant and condition to be performed or
observed by the Servicer or the Special Servicer, as applicable, under this
Agreement from and after the date of such agreement; (ii) as evidenced by a
letter from each Rating Agency delivered to the Trustee, each Rating Agency's
rating or ratings of the Regular Certificates in effect immediately prior to
such assignment and delegation will not be qualified, downgraded or withdrawn
as a result of such assignment and delegation; (iii) the Servicer or the
Special Servicer, as applicable, shall not be released from its obligations
under this Agreement that arose prior to the effective date of such assignment
and delegation under this Section 6.4; and (iv) the rate at which the
Servicing Fee (or any component thereof) is calculated shall not exceed the
rate in effect prior to such assignment and delegation. Upon acceptance of
such assignment and delegation, the purchaser or transferee shall be the
successor Servicer or Special Servicer hereunder, as applicable.
Except as provided in this Section 6.4, neither the Servicer
nor the Special Servicer shall resign from the obligations and duties hereby
imposed on it except upon determination that its duties hereunder are no
longer permissible under applicable law. Any such determination permitting the
resignation of the Servicer or the Special Servicer, as applicable, shall be
evidenced by an Opinion of Counsel (obtained at the resigning Servicer's
expense) to such effect delivered to the Trustee.
No resignation or removal of the Servicer or the Special
Servicer, as applicable, as contemplated by the preceding paragraphs shall
become effective until the Trustee or a successor Servicer or the Special
Servicer, as applicable, shall have assumed the Servicer's or the Special
Servicer's responsibilities, duties, liabilities and obligations hereunder.
SECTION 6.5. Rights of the Depositor and the Trustee in
Respect of the Servicer and the Special
Servicer.
Each of the Servicer and the Special Servicer shall afford
the Depositor and the Trustee, upon reasonable notice, during normal business
hours access to all records maintained by it in respect of its rights and
obligations hereunder and access to its officers responsible for such
obligations. Upon request, each of the Servicer and the Special Servicer shall
furnish to the Depositor and the Trustee its most recent financial statements
and such other information in its possession regarding its business, affairs,
property and condition, financial or otherwise, as the party requesting such
information, in its reasonable judgment, determines to be relevant to the
performance of the obligations hereunder of the Servicer or the Special
Servicer. Neither the Depositor nor the Trustee shall have any responsibility
or liability for any action or failure to act by the Servicer or the Special
Servicer and neither such Person is obligated to supervise the performance of
the Servicer or the Special Servicer under this Agreement or otherwise.
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ARTICLE VII
DEFAULT
SECTION 7.1. Events of Default.
"Event of Default", wherever used herein, means any one of
the following events:
(i) any failure by the Servicer to remit to the
Collection Account or any failure by the Servicer
to remit to the Trustee for deposit into the
Distribution Account any amount required to be so
remitted by the Servicer pursuant to and in
accordance with the terms of this Agreement; or
(ii) any failure on the part of the Servicer or Special
Servicer duly to observe or perform in any material
respect any other of the covenants or agreements,
or the breach of any representations or warranties
provided herein on the part of the Servicer or the
Special Servicer which materially and adversely
affects the interests of the Certificateholders,
the Servicer, the Special Servicer or the Trustee
with respect to any Mortgage Loan and which, in
either event, continues unremedied for a period of
___ days after the date on which written notice of
such failure or breach, requiring the same to be
remedied, shall have been given to the Servicer or
Special Servicer by the Depositor or the Trustee,
or to the Servicer or Special Servicer, the
Depositor and the Trustee by the Holders of
Certificates entitled to at least __% of the
aggregate Voting Rights of any Class affected
thereby; or
(iii) confirmation in writing by any of the Rating
Agencies that the then-current rating assigned to
any Class of Certificates will be withdrawn,
downgraded or qualified if the Servicer or Special
Servicer is not removed as Servicer or Special
Servicer hereunder; or
(iv) a decree or order of a court or agency or
supervisory authority having jurisdiction in the
premises in an involuntary case under any present
or future federal or state bankruptcy, insolvency
or similar law for the appointment of a conservator
or receiver or liquidator in any insolvency,
readjustment of debt, marshalling of assets and
liabilities or similar proceedings, or for the
winding-up or liquidation of its affairs, shall
have been entered against the Servicer or Special
Servicer and such decree or order shall have
remained in force, undischarged or unstayed, for a
period of ___ days; or
(v) the Servicer or Special Servicer shall consent to
the appointment of a conservator or receiver or
liquidator in any insolvency, readjustment of
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debt, marshalling of assets and liabilities or
similar proceedings of or relating to the Servicer
or the Special Servicer, or of or relating to all
or substantially all of the property of either the
Servicer or the Special Servicer; or
(vi) the Servicer or Special Servicer shall admit in
writing its inability to pay its debts generally as
they become due, file a petition to take advantage
of any applicable insolvency or reorganization
statute, make an assignment for the benefit of its
creditors, or voluntarily suspend payment of its
obligations; or
(vii) the Servicer shall fail to make any Advance
required to be made by the Servicer hereunder
(whether or not the Trustee or the Fiscal Agent
makes such Advance);
then, and in each and every such case, so long as an Event of Default shall
not have been remedied, the Trustee may, and at the written direction of the
Holders of at least __% of the aggregate Voting Rights of all Certificates,
the Trustee shall, by notice in writing to the Servicer or the Special
Servicer, as the case may be, terminate all of its respective rights and
obligations under this Agreement and in and to the Mortgage Loans and the
proceeds thereof, other than any rights it may have hereunder as a
Certificateholder and any rights or obligations that accrued prior to the date
of such termination (including the right to receive all amounts accrued or
owing to it under this Agreement, plus interest at the Advance Rate on such
amounts until received to the extent such amounts bear interest as provided in
this Agreement, with respect to periods prior to the date of such termination,
and the right to the benefits of Section 6.3 notwithstanding any such
termination); provided, however, that in the event the Servicer and the
Special Servicer is the same Person, any termination of the Servicer shall
constitute a termination of the Special Servicer and vice versa. On or after
the receipt by the Servicer or the Special Servicer, as the case may be, of
such written notice, all of its authority and power under this Agreement,
whether with respect to the Certificates or the Mortgage Loans or otherwise,
shall pass to and be vested in the Trustee pursuant to and under this Section
(notwithstanding any failure of the Trustee to satisfy the criterion set forth
in Section 6.4) and, without limitation, the Trustee is hereby authorized and
empowered to execute and deliver, on behalf of and at the expense of the
defaulting Servicer or Special Servicer, as the case may be, as
attorney-in-fact or otherwise, any and all documents and other instruments,
and to do or accomplish all other acts or things necessary or appropriate to
effect the purposes of such notice of termination, whether to complete the
transfer and endorsement or assignment of the Mortgage Loans and related
documents, or otherwise. Each of the Servicer and the Special Servicer, on
behalf of itself, agrees in the event it is terminated pursuant to this
Section 7.1 promptly (and in any event no later than ___ Business Days
subsequent to such notice) to provide, at its own expense, the Trustee with
all documents and records requested by the Trustee to enable the Trustee to
assume its functions hereunder, and to cooperate with the Trustee and the
successor to its responsibilities hereunder in effecting the termination of
its responsibilities and rights hereunder, including, without limitation, the
transfer to the successor Servicer or Special Servicer or the Trustee, as
applicable, for administration by it of all cash amounts which shall at the
time be or should have been credited by the Servicer or the Special Servicer
to the Collection Account and any REO
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Account or Reserve Account or thereafter be received with respect to the
Mortgage Loans, and shall promptly provide the Trustee or such successor
Servicer or Special Servicer (which may include the Trustee), as applicable,
all documents and records reasonably requested by it, such documents and
records to be provided in such form as the Trustee or such successor Servicer
or Special Servicer shall reasonably request (including electromagnetic form),
to enable it to assume the Servicer's or Special Servicer's function
hereunder. All reasonable costs and expenses of the successor Servicer or
successor Special Servicer incurred in connection with transferring the
Mortgage Files to the successor Servicer (or copies of the Mortgage Files
relating to Specially Serviced Mortgage Loans to the Successor Special
Servicer) and amending this Agreement to reflect such succession as Servicer
or successor Special Servicer pursuant to this Section 7.1 shall be paid by
the predecessor Servicer or Special Servicer upon presentation of reasonable
documentation of such costs and expenses; provided, however, that if any such
costs and expenses remain unpaid by the predecessor Servicer or Special
Servicer within a reasonable time after presentation of such documentation,
the Trustee may be reimbursed from the Collection Account for such unpaid
costs and expenses, which shall be deemed to be expenses of the Trust Fund.
SECTION 7.2. Trustee to Act; Appointment of Successor.
On and after the time the Servicer or the Special Servicer
receives a notice of termination pursuant to Section 7.1, the Trustee shall be
its successor in such capacity in all respects under this Agreement and the
transactions set forth or provided for herein and, except as provided herein,
shall be subject to all the responsibilities, duties, limitations on liability
and liabilities relating thereto and arising thereafter placed on the Servicer
or Special Servicer by the terms and provisions hereof; provided, however,
that (i) the Trustee shall have no responsibilities, duties, liabilities or
obligations with respect to any act or omission of the Servicer or of the
Special Servicer and (ii) any failure to perform, or delay in performing, such
duties or responsibilities caused by the terminated party's failure to
provide, or delay in providing, records, tapes, disks, information or monies
shall not be considered a default by any successor hereunder. The appointment
of a successor Servicer or Special Servicer shall not affect any liability of
the predecessor Servicer or Special Servicer, as applicable, which may have
arisen prior to its termination as Servicer or Special Servicer. The Trustee
shall not be liable for any of the representations and warranties of the
Servicer or of the Special Servicer herein or in any related document or
agreement, for any acts or omissions of the predecessor Servicer or Special
Servicer, as applicable, or for any losses incurred in respect of any
Permitted Investment by the Servicer pursuant to Section 3.7 hereunder nor
shall the Trustee be required to purchase any Mortgage Loan hereunder. As
compensation therefor, the Trustee as successor Servicer or Special Servicer
shall be entitled to all Servicing Compensation relating to the Mortgage Loans
that accrue after the date of the Trustee's succession to which the Servicer
or Special Servicer would have been entitled if the Servicer or Special
Servicer, as applicable, had continued to act hereunder. In the event any
Advances made by the Servicer or the Trustee shall at any time be outstanding,
or any amounts of interest thereon shall be accrued and unpaid, all amounts
available to repay Advances and interest hereunder shall be applied entirely
to the Advances made by the Trustee (and the accrued and unpaid interest
thereon), until such Advances made by the Trustee (and accrued and unpaid
interest thereon) shall have been repaid in full. Notwithstanding the above,
the Trustee may, if it shall be unwilling to so act, or shall,
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if it is unable to so act, or if the Holders of Certificates entitled to at
least __% of the aggregate Voting Rights so request in writing to the Trustee,
or if (x) neither the Trustee nor the Fiscal Agent is rated by each Rating
Agency in one of its two highest long-term debt rating categories or (y) the
Trustee is not listed on S&P's list of approved servicers, promptly appoint,
or petition a court of competent jurisdiction to appoint, any established
mortgage loan servicing institution, the appointment of which will not result
in the downgrading, withdrawal or qualification of the rating or ratings then
assigned to any Class of Certificates as evidenced in writing by each Rating
Agency, as the successor to the Servicer or Special Servicer hereunder in the
assumption of all or any part of the responsibilities, duties or liabilities
of the Servicer or Special Servicer hereunder. No appointment of a successor
to the Servicer or Special Servicer hereunder shall be effective until the
assumption by such successor of all the Servicer's or Special Servicer's
responsibilities, duties and liabilities hereunder. Pending appointment of a
successor to the Servicer or Special Servicer hereunder, unless the Trustee
shall be prohibited by law from so acting, the Trustee shall act in such
capacity as herein above provided. In connection with such appointment and
assumption described herein, the Trustee may make such arrangements for the
compensation of such successor out of payments on Mortgage Loans as it and
such successor shall agree; provided, however, that no such compensation shall
be in excess of that permitted the terminated party hereunder. The Depositor,
the Trustee, the Servicer or Special Servicer and such successor shall take
such action, consistent with this Agreement, as shall be necessary to
effectuate any such succession.
SECTION 7.3. Notification to Certificateholders.
(a) Upon any termination pursuant to Section 7.1 above or
appointment of a successor to the Servicer or the Special Servicer, the
Trustee shall give prompt written notice thereof to Certificateholders at
their respective addresses appearing in the Certificate Register and to each
Rating Agency.
(b) Within ___ days after the occurrence of any Event of
Default of which a Responsible Officer of the Trustee has actual knowledge,
the Trustee shall transmit by mail to all Holders of Certificates and to each
Rating Agency notice of such Event of Default, unless such Event of Default
shall have been cured or waived.
SECTION 7.4. Other Remedies of Trustee.
During the continuance of any Event of Default, so long as
such Event of Default shall not have been remedied, the Trustee, in addition
to the rights specified in Section 7.1, shall have the right, in its own name
as trustee of an express trust, to take all actions now or hereafter existing
at law, in equity or by statute to enforce its rights and remedies and to
protect the interests, and enforce the rights and remedies, of the
Certificateholders (including the institution and prosecution of all judicial,
administrative and other proceedings and the filing of proofs of claim and
debt in connection therewith). In such event, the legal fees, expenses and
costs of such action and any liability resulting therefrom shall be expenses,
costs and liabilities of the Trust Fund, and the Trustee shall be entitled to
be reimbursed therefor from the Collection Account as provided in Section
3.6(vi). Except as otherwise expressly provided in this Agreement, no remedy
provided for by this Agreement shall be exclusive of any other remedy,
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and each and every remedy shall be cumulative and in addition to any other
remedy and no delay or omission to exercise any right or remedy shall impair
any such right or remedy or shall be deemed to be a waiver of any Event of
Default.
SECTION 7.5. Waiver of Past Events of Default;
Termination.
The Holders of Certificates evidencing not less than _____%
of the aggregate Voting Rights of the Certificates may, on behalf of all
Holders of Certificates, waive any default by the Servicer or Special Servicer
in the performance of its obligations hereunder and its consequences, except a
default in making any required deposits to (including P&I Advances) or
payments from the Collection Account or the Distribution Account or in
remitting payments as received, in each case in accordance with this
Agreement. Upon any such waiver of a past default, such default shall cease to
exist, and any Event of Default arising therefrom shall be deemed to have been
remedied for every purpose of this Agreement. No such waiver shall extend to
any subsequent or other default or impair any right consequent thereon.
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ARTICLE VIII
CONCERNING THE TRUSTEE
SECTION 8.1. Duties of Trustee.
(a) The Trustee, prior to the occurrence of an Event of
Default of which a Responsible Officer of the Trustee has actual knowledge and
after the curing or waiver of all Events of Default which may have occurred,
undertakes to perform such duties and only such duties as are specifically set
forth in this Agreement and no permissive right of the Trustee shall be
construed as a duty. During the continuance of an Event of Default of which a
Responsible Officer of the Trustee has actual knowledge, the Trustee shall
exercise such of the rights and powers vested in it by this Agreement, and use
the same degree of care and skill in their exercise, as a prudent person would
exercise or use under the circumstances in the conduct of such person's own
affairs.
(b) The Trustee, upon receipt of any resolutions,
certificates, statements, opinions, reports, documents, orders or other
instruments furnished to the Trustee which are specifically required to be
furnished pursuant to any provision of this Agreement, shall examine them to
determine whether they conform on their face to the requirements of this
Agreement; provided, however, that, the Trustee shall not be responsible for
the accuracy or content of any such resolution, certificate, statement,
opinion, report, document, order or other instrument provided to it hereunder
by the Servicer, the Special Servicer, the Depositor, the Paying Agent or the
Auction Agent. If any such instrument is found not to conform on its face to
the requirements of this Agreement in a material manner, the Trustee shall
take action as it deems appropriate to have the instrument corrected.
(c) No provision of this Agreement shall be construed to
relieve the Trustee from liability for its own negligent action, its own
negligent failure to act or its own willful misconduct; provided, however,
that the foregoing shall be subject to Section 8.2; and provided, further,
that:
(i) Prior to the occurrence of an Event of Default of
which a Responsible Officer of the Trustee has
actual knowledge, and after the curing or waiver of
all such Events of Default which may have occurred,
the duties and obligations of the Trustee shall be
determined solely by the express provisions of this
Agreement, the Trustee shall not be liable except
for the performance of such duties and obligations
as are specifically set forth in this Agreement, no
implied covenants or obligations shall be read into
this Agreement against the Trustee and, in the
absence of bad faith on the part of the Trustee,
the Trustee may conclusively rely, as to the truth
of the statements and the correctness of the
opinions expressed therein, upon any resolutions,
certificates, statements, reports, opinions,
documents, orders or other instruments furnished to
the Trustee that conform on their face to the
requirements of this Agreement without
responsibility for investigating the contents
thereof;
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(ii) The Trustee shall not be personally liable for an
error of judgment made in good faith by a
Responsible Officer or Responsible Officers, unless
it shall be proven that the Trustee was negligent
in ascertaining the pertinent facts;
(iii) The Trustee shall not be personally liable with
respect to any action taken, suffered or omitted to
be taken by it in good faith in accordance with the
direction of Holders of Certificates entitled to at
least __% of the aggregate Voting Rights (or such
other percentage as is specified herein) of each
affected Class, or of the aggregate Voting Rights
of the Certificates, relating to the time, method
and place of conducting any proceeding for any
remedy available to the Trustee, or exercising or
omitting to exercise any trust or power conferred
upon the Trustee, under this Agreement; and
(iv) The Trustee shall not be charged with knowledge of
any failure by the Servicer or the Special Servicer
to comply with the obligations of the Servicer or
the Special Servicer referred to in clause (i) or
(ii) of Section 7.1, or of any breach or occurrence
referred to in clause (iii) through (viii) of
Section 7.1, unless a Responsible Officer of the
Trustee obtains actual knowledge of such failure,
breach or occurrence. The Trustee shall be deemed
to have actual knowledge of the Servicer's or the
Special Servicer's failure to comply with its
obligations listed in clause (i) of Section 7.1 or
to provide scheduled reports, certificates and
statements when and as required to be delivered to
the Trustee pursuant to this Agreement.
The Trustee, in its capacity as Trustee, shall not be
required to expend or risk its own funds or otherwise incur financial
liability in the performance of any of its duties hereunder, or in the
exercise of any of its rights or powers, if in the Trustee's opinion the
repayment of such funds or adequate indemnity against such risk or liability
is not reasonably assured to it, and none of the provisions contained in this
Agreement shall in any event require the Trustee to perform, or be responsible
for the manner of performance of, any of the obligations of the Servicer or
the Special Servicer under this Agreement, except pursuant to Sections 4.6 or
6.4 during such time, if any, as the Trustee shall be the successor to, and be
vested with the rights, duties, powers and privileges of, the Servicer or the
Special Servicer in accordance with the terms of this Agreement. The Trustee
shall not be required to post any surety or bond of any kind in connection
with its performance of its obligations under this Agreement.
SECTION 8.2. Certain Matters Affecting the Trustee.
(a) Except as otherwise provided in Section 8.1:
(i) The Trustee may request and/or rely upon and shall
be protected in acting or refraining from acting
upon any resolution, Officer's Certificate,
certificate of auditors or any other certificate,
statement, instrument,
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opinion, report, notice, request, consent, order,
appraisal, bond or other paper or document
reasonably believed by it to be genuine and to have
been signed or presented by the proper party or
parties and the Trustee shall have no
responsibility to ascertain or confirm the
genuineness of any such party or parties;
(ii) The Trustee may consult with counsel and any
Opinion of Counsel shall be full and complete
authorization and protection in respect of any
action taken or suffered or omitted by it hereunder
in good faith and in accordance with such Opinion
of Counsel;
(iii) (A) The Trustee shall be under no obligation to
institute, conduct or defend any litigation
hereunder or in relation hereto at the request,
order or direction of any of the
Certificateholders, pursuant to the provisions of
this Agreement, unless such Certificateholders
shall have offered to the Trustee reasonable
security or indemnity against the costs, expenses
and liabilities which may be incurred therein or
thereby; (B) the right of the Trustee to perform
any discretionary act enumerated in this Agreement
shall not be construed as a duty, and the Trustee
shall not be answerable for other than its
negligence or willful misconduct in the performance
of any such act; provided, however, that subject to
the foregoing clause (A), nothing contained herein
shall relieve the Trustee of the obligations, upon
the occurrence of an Event of Default (which has
not been cured or waived) of which a Responsible
Officer of the Trustee has actual knowledge, to
exercise such of the rights and powers vested in it
by this Agreement, and to use the same degree of
care and skill in their exercise, as a prudent
person would exercise or use under the
circumstances in the conduct of such person's own
affairs;
(iv) The Trustee shall not be personally liable for any
action taken, suffered or omitted by it in good
faith and reasonably believed by it to be
authorized or within the discretion or rights or
powers conferred upon it by this Agreement;
(v) The Trustee shall not be bound to make any
investigation into the facts or matters stated in
any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order,
approval bond or other paper or document, unless
requested in writing to do so by Holders of
Certificates entitled to at least __% (or such
other percentage as is specified herein) of the
aggregate Voting Rights of any affected Class;
provided, however, that if the payment within a
reasonable time to the Trustee of the costs,
expenses or liabilities likely to be incurred by it
in the making of such investigation is, in the
opinion of the Trustee, not reasonably assured to
the Trustee by the security afforded to it by the
terms of this Agreement, the Trustee may require
reasonable indemnity against such expense or
liability as a condition to taking any such action.
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The reasonable expense of every such investigation
shall be paid by the Servicer or the Special
Servicer if an Event of Default shall have occurred
and be continuing relating to the Servicer, or the
Special Servicer, respectively, and otherwise by
the Certificateholders requesting the
investigation; and
(vi) The Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either
directly or by or through agents or attorneys. The
Trustee shall not be liable or responsible for the
misconduct or negligence of any of the Trustee's
agents or attorneys appointed with due care by the
Trustee hereunder.
(b) Following the Start-up Day, the Trustee shall not,
except as expressly required by any provision of this Agreement, accept any
contribution of assets to the Trust Fund unless the Trustee shall have
received an Opinion of Counsel (the costs of obtaining such opinion to be
borne by the Person requesting such contribution) to the effect that the
inclusion of such assets in the Trust Fund will not cause either the
Upper-Tier REMIC or the Lower-Tier REMIC to fail to qualify as a REMIC at any
time that any Certificates are outstanding or subject either the Upper-Tier
REMIC or the Lower-Tier REMIC to any tax under the REMIC Provisions or other
applicable provisions of federal, state and local law or ordinances.
(c) All rights of action under this Agreement or under any
of the Certificates, enforceable by the Trustee, may be enforced by it without
the possession of any of the Certificates, or the production thereof at the
trial or other proceeding relating thereto, and any such suit, action or
proceeding instituted by the Trustee shall be brought in its name for the
benefit of all the Holders of such Certificates, subject to the provisions of
this Agreement.
The Trustee shall have no duty to conduct any affirmative
investigation as to the occurrence of any condition requiring the repurchase
of any Mortgage Loan by the Depositor pursuant to this Agreement or the
eligibility of any Mortgage Loan for purposes of this Agreement.
SECTION 8.3. Trustee Not Liable for Certificates or
Mortgage Loans.
The recitals contained herein and in the Certificates shall
not be taken as the statements of the Trustee, the Fiscal Agent, the Servicer
or the Special Servicer and the Trustee, the Fiscal Agent, the Special
Servicer and the Servicer assume no responsibility for their correctness. The
Trustee, the Fiscal Agent, the Servicer and the Special Servicer make no
representations or warranties as to the validity or sufficiency of this
Agreement, of the Certificates, or any private placement memorandum or
prospectus used to offer the Certificates for sale or the validity,
enforceability or sufficiency of any Mortgage Loan or related document. The
Trustee and the Fiscal Agent shall at no time have any responsibility or
liability for or with respect to the legality, validity and enforceability of
any Mortgage or any Mortgage Loan, or the perfection and priority of any
Mortgage or the maintenance of any such perfection and priority, or for or
with respect to the sufficiency of the Trust Fund or its ability to generate
the payments to be distributed to Certificateholders under this Agreement.
Without limiting the
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foregoing, neither the Trustee nor the Fiscal Agent shall be liable or
responsible for: the existence, condition and ownership of any Mortgaged
Property; the existence of any hazard or other insurance thereon (other than,
with respect to the Trustee only, if the Trustee shall assume the duties of
the Servicer pursuant to Section 7.2) or the enforceability thereof; the
existence of any Mortgage Loan or the contents of the related Mortgage File on
any computer or other record thereof (other than, with respect to the Trustee
only, if the Trustee shall assume the duties of the Servicer or the Special
Servicer pursuant to Section 7.2); the validity of the assignment of any
Mortgage Loan to the Trust Fund or of any intervening assignment; the
completeness of any Mortgage File; the performance or enforcement of any
Mortgage Loan (other than, with respect to the Trustee only, if the Trustee
shall assume the duties of the Servicer or the Special Servicer pursuant to
Section 7.2); the compliance by the Depositor, the Servicer or the Special
Servicer with any warranty or representation made under this Agreement or in
any related document or the accuracy of any such warranty or representation
prior to the Trustee's receipt of notice or other discovery of any
non-compliance therewith or any breach thereof; any investment of monies by or
at the direction of the Servicer or the Special Servicer or any loss resulting
therefrom, it being understood that the Trustee only shall remain responsible
for any Trust Fund property that it may hold in its individual capacity; the
acts or omissions of any of the Depositor, the Servicer or the Special
Servicer (other than, with respect to the Trustee only, if the Trustee shall
assume the duties of the Servicer or the Special Servicer pursuant to Section
7.2) or any subservicer or any Borrower; any action of the Servicer or the
Special Servicer (other than, with respect to the Trustee only, if the Trustee
shall assume the duties of the Servicer or the Special Servicer pursuant to
Section 7.2) or any subservicer taken in the name of the Trustee, except with
respect to the Trustee, to the extent such action is taken at the express
written direction of the Trustee; the failure of the Servicer or the Special
Servicer or any subservicer to act or perform any duties required of it on
behalf of the Trust Fund or the Trustee hereunder; or any action by or
omission of the Trustee taken at the instruction of the Servicer or the
Special Servicer (other than in each case, with respect to the Trustee only,
if the Trustee shall assume the duties of the Servicer or the Special Servicer
pursuant to Section 7.2) unless the taking of such action is not permitted by
the express terms of this Agreement; provided, however, that the foregoing
shall not relieve the Trustee or the Fiscal Agent of its obligation to perform
its duties as specifically set forth in this Agreement. Under no circumstances
shall the Fiscal Agent be liable under any of the circumstances described in
the preceding sentence. The Trustee and the Fiscal Agent shall not be
accountable for the use or application by the Depositor, the Servicer or the
Special Servicer of any of the Certificates or of the proceeds of such
Certificates, or for the use or application of any funds paid to the
Depositor, the Servicer or the Special Servicer in respect of the Mortgage
Loans or deposited in or withdrawn from the Collection Account, or the
Distribution Account by the Depositor, the Servicer or the Special Servicer,
other than in each case, with respect to the Trustee only, any funds held by
the Trustee. The Trustee (unless the Trustee shall have become the successor
Servicer) or the Fiscal Agent shall have no responsibility for (A) filing any
financing or continuation statement in any public office at any time or to
otherwise perfect or maintain the perfection of any security interest or lien
granted to it hereunder or to record this Agreement, (B) seeing to any
insurance, (C) seeing to the payment or discharge of any tax, assessment, or
other governmental charge or any lien or encumbrance of any kind owing with
respect to, assessed or levied against any part of the Trust Fund, or (D)
confirming or verifying the contents of any reports or certificates of the
Servicer delivered to the Trustee pursuant to this Agreement believed by the
Trustee to be
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genuine and to have been signed or presented by the proper party or parties.
In making any calculation hereunder which includes as a component thereof the
payment or distribution of interest for a stated period at a stated rate "to
the extent permitted by applicable law," the Trustee shall assume that such
payment is so permitted unless a Responsible Officer of the Trustee has actual
knowledge, or receives an Opinion of Counsel (at the expense of the Person
asserting the impermissibility) to the effect, that such payment is not
permitted by applicable law.
SECTION 8.4. Trustee May Own Certificates.
The Trustee and the Fiscal Agent in their individual
capacities or any other capacity may become the owner or pledgee of
Certificates, and may deal with the Depositor, the Servicer and the Special
Servicer in banking transactions, with the same rights each would have if it
were not Trustee or Fiscal Agent.
SECTION 8.5. Payment of Trustee's Fees and Expenses;
Indemnification.
(a) The Servicer covenants and agrees to pay to the Trustee
or any successor Trustee from time to time, and the Trustee or any successor
Trustee shall be entitled to receive from the Servicer the Trustee Fee (which
shall not be limited by any provision of law in regard to the compensation of
a trustee of an express trust) for all services rendered by the Trustee in the
execution of the trusts hereby created and in the exercise and performance of
any of the powers and duties hereunder of the Trustee.
(b) To the extent specifically permitted by Section 3.12(d),
the Trustee shall be paid or reimbursed from the Trust Fund upon its request
for expenses, disbursements and advances incurred or made by the Trustee
pursuant to and in accordance with any of the provisions of this Agreement
except any such expense, disbursement or advance as may arise from its
negligence or bad faith; provided, however, that the Trustee shall not refuse
to perform any of its duties hereunder solely as a result of the failure to be
paid the Trustee Fee and the Trustee's expenses.
The Servicer and the Special Servicer covenant and agree to
pay or reimburse the Trustee for the reasonable expenses, disbursements and
advances incurred or made by the Trustee in connection with any transfer of
the servicing responsibilities of the Servicer or the Special Servicer, as
applicable hereunder, pursuant to or otherwise arising from the resignation or
removal of the Servicer or the Special Servicer, as applicable, in accordance
with any of the provisions of this Agreement (and including the reasonable
fees and expenses and disbursements of its counsel and all other persons not
regularly in its employ), except any such expense, disbursement or advance as
may arise from the negligence or bad faith of the Trustee.
(c) Each of the Paying Agent, the Certificate Registrar, the
Custodian, the Servicer and the Special Servicer shall indemnify the Trustee
and the Fiscal Agent and their respective Affiliates and each of the
directors, officers, employees and agents of the Trustee, the Fiscal Agent and
their respective Affiliates (each, an "Indemnified Party"), and hold each of
them harmless against any, and all claims, losses, damages, penalties, fines,
forfeitures,
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reasonable and necessary legal fees and related costs, judgments, and any
other costs, fees and expenses that the Indemnified Party may sustain in
connection with this Agreement related to each such party's respective willful
misconduct, bad faith, fraud and/or negligence in the performance of its
respective duties hereunder or by reason of reckless disregard of its
respective obligations and duties hereunder (including in the case of the
Servicer or the Special Servicer, any agent of the Servicer or the Special
Servicer).
(d) The Trust Fund shall indemnify each Indemnified Party
from, and hold it harmless against, any and all losses, liabilities, damages,
claims or expenses (including reasonable attorneys' fees) arising in respect
of this Agreement or the Certificates, in each case to the extent, and only to
the extent, such payments are expressly reimbursable under this Agreement or
are "unanticipated expenses incurred by the REMIC" within the meaning of
Treasury Regulations Section 1.860G-1(b)(3)(ii), other than (i) those
resulting from the negligence, fraud, bad faith or willful misconduct of the
Trustee and (ii) those as to which such Indemnified Party is entitled to
indemnification pursuant to Section 8.5(c). The term "unanticipated expenses
incurred by a REMIC" shall include any fees, expenses and disbursements of any
separate trustee or co-trustee appointed hereunder, only to the extent such
fees, expenses and disbursements were not reasonably anticipated as of the
Closing Date and the losses, liabilities, damages, claims or expenses
(including reasonable attorneys' fees) incurred or advanced by an Indemnified
Party in connection with any litigation arising out of this Agreement,
including, without limitation, under Section 2.3, Section 3.10, the third
paragraph of Section 3.11, Section 8.11, Section 4.5, Section 5.1, and Section
7.1. The right of reimbursement of the Indemnified Parties under this Section
8.5(d) shall be senior to the rights of all Certificateholders.
(e) Notwithstanding anything herein to the contrary, this
Section 8.5 shall survive the termination or maturity of this Agreement or the
resignation or removal of the Trustee as regards rights accrued prior to such
resignation or removal and (with respect to any acts or omissions during their
respective tenures) the resignation, removal or termination of the Servicer,
the Special Servicer, the Paying Agent, the Certificate Registrar or the
Custodian.
(f) This Section 8.5 shall be expressly construed to
include, but not be limited to, such indemnities, compensation, expenses,
disbursements, advances, losses, liabilities, damages and the like, as may
pertain or relate to any environmental law or environmental matter.
SECTION 8.6. Eligibility Requirements for Trustee.
The Trustee hereunder shall at all times be a corporation or
association organized and doing business under the laws of any state or the
United States of America, authorized under such laws to exercise corporate
trust powers and to accept the trust conferred under this Agreement, having a
combined capital and surplus of at least $_________ and a rating on its
unsecured long-term debt of at least "BBB" (or "AA" at any time when there is
no Fiscal Agent appointed and acting hereunder or any such Fiscal Agent so
appointed has a rating on its long-term unsecured debt that is lower than "AA"
(without regard to any plus or minus), unless each of the Rating Agencies has
confirmed in writing the appointment of such Fiscal Agent shall
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not result, in and of itself, in a downgrading, withdrawal or qualification of
the ratings then assigned by such Rating Agency to any Class of the
Certificates) from each Rating Agency, unless each of the Rating Agencies has
confirmed in writing that a lower rating shall not result, in and of itself,
in a downgrading, withdrawal or qualification of the rating then assigned by
such Rating Agency to any Class of the Certificates and subject to supervision
or examination by federal or state authority and shall not be an Affiliate of
the Servicer or the Special Servicer (except during any period when the
Trustee has assumed the duties of the Servicer or the Special Servicer, as
applicable, pursuant to Section 7.2). If a corporation or association
publishes reports of condition at least annually, pursuant to law or to the
requirements of the aforesaid supervising or examining authority, then for
purposes of this Section the combined capital and surplus of such corporation
shall be deemed to be its combined capital and surplus as set forth in its
most recent report of condition so published. In the event that the place of
business from which the Trustee administers the Trust Fund is a state or local
jurisdiction that imposes a tax on the Trust Fund or the net income of a REMIC
(other than a tax corresponding to a tax imposed under the REMIC Provisions)
the Trustee shall elect, at its sole discretion, either to (i) resign
immediately in the manner and with the effect specified in Section 8.7, (ii)
pay such tax and continue as Trustee or (iii) administer the Trust Fund from a
state and local jurisdiction that does not impose such a tax. In case at any
time the Trustee shall cease to be eligible in accordance with the provisions
of this Section, the Trustee shall resign immediately in the manner and with
the effect specified in Section 8.7.
SECTION 8.7. Resignation and Removal of the Trustee.
The Trustee may at any time resign and be discharged from
the trusts hereby created by giving written notice thereof to the Depositor,
the Servicer, the Special Servicer and each Rating Agency. Upon such notice of
resignation, the Fiscal Agent shall also be deemed to have been removed and,
accordingly, the Servicer shall promptly appoint a successor Trustee, which
appointment of successor Trustee shall not result, in and of itself, in a
downgrading, withdrawal or qualification of the rating then assigned by the
Rating Agencies to any Class of the Certificates as confirmed in writing by
each of the Rating Agencies, and successor Fiscal Agent, which, if the
successor Trustee is not rated by each Rating Agency in one of its two highest
long-term debt rating categories, shall be confirmed in writing by each of the
Rating Agencies that such appointment of successor Fiscal Agent shall not
result, in and of itself, in a downgrading, withdrawal or qualification of the
rating then assigned by such Rating Agency to any Class of the Certificates by
written instrument, in triplicate, which instrument shall be delivered to the
resigning Trustee, with a copy to the fiscal agent deemed removed, and the
successor Trustee and successor Fiscal Agent. Notwithstanding the foregoing,
if no successor Trustee and Fiscal Agent shall have been so appointed and have
accepted appointment within ___ days after the giving of such notice of
resignation, the resigning Trustee and departing Fiscal Agent may petition any
court of competent jurisdiction for the appointment of a successor Trustee and
successor Fiscal Agent.
If at any time the Trustee shall cease to be eligible in
accordance with the provisions of Section 8.6 and shall fail to resign after
written request therefor by the Depositor or Servicer, or if at any time the
Trustee or the Fiscal Agent shall become incapable of acting, or shall be
adjudged bankrupt or insolvent, or a receiver of the Trustee or the Fiscal
Agent or
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of its property shall be appointed, or any public officer shall take charge or
control of the Trustee or the Fiscal Agent or of its property or affairs for
the purpose of rehabilitation, conservation or liquidation, then the Depositor
or the Servicer may remove the Trustee and the Fiscal Agent and shall promptly
appoint a successor Trustee and successor Fiscal Agent by written instrument,
which shall be delivered to the Trustee and the Fiscal Agent so removed and to
the successor Trustee and successor Fiscal Agent.
The Holders of Certificates entitled to at least __% of the
Voting Rights may at any time remove the Trustee and the Fiscal Agent (and any
removal of the Trustee shall be deemed to be a removal also of the Fiscal
Agent) and appoint a successor Trustee and successor Fiscal Agent (each
meeting the requirements of Section 8.8) by written instrument or instruments,
in eight originals, signed by such Holders or their attorneys-in-fact duly
authorized, one complete set of which instruments shall be delivered to the
Depositor, one complete set to the Servicer, one complete set to the Special
Servicer, one complete set to the Trustee so removed, one complete set to the
Fiscal Agent deemed removed, one complete set to the successor Trustee so
appointed and one complete set to the successor Fiscal Agent so appointed.
In the event of the resignation or removal of the Trustee,
the Fiscal Agent shall be entitled to resign, it being understood that the
initial Fiscal Agent shall not be obligated to act in such capacity hereunder
at any time that is not the Trustee.
Any resignation or removal of the Trustee and Fiscal Agent
and appointment of a successor Trustee and, if such trustee is not rated by
each Rating Agency in one of its two highest long-term debt rating categories,
a successor Fiscal Agent pursuant to any of the provisions of this Section 8.7
shall not become effective until acceptance of appointment by the successor
Trustee and, if necessary, Fiscal Agent as provided in Section 8.8.
SECTION 8.8. Successor Trustee.
Any successor Trustee and any successor Fiscal Agent
appointed as provided in Section 8.7 shall execute, acknowledge and deliver to
the Depositor and to the predecessor Trustee and predecessor Fiscal Agent, as
the case may be, instruments accepting their appointment hereunder, and
thereupon the resignation or removal of the predecessor Trustee and
predecessor Fiscal Agent shall become effective and such successor Trustee and
successor Fiscal Agent, without any further act, deed or conveyance, shall
become fully vested with all the rights, powers, duties and obligations of its
predecessor hereunder, with the like effect as if originally named as Trustee
herein, provided that each Rating Agency shall have confirmed in writing that
the appointment of such successor Trustee and successor Fiscal Agent shall not
result, in and of itself, in a downgrading, withdrawal or qualification of the
rating then assigned by such Rating Agency to any Class of the Certificates.
The predecessor Trustee shall deliver to the successor Trustee all Mortgage
Files and related documents and statements held by it hereunder, and the
Depositor, the predecessor Trustee and predecessor Fiscal Agent shall execute
and deliver such instruments and do such other things as may reasonably be
required for more fully and certainly vesting and confirming in the successor
Trustee and successor Fiscal Agent all such rights, powers, duties and
obligations. No successor Trustee or successor Fiscal Agent shall accept
appointment as provided in this Section 8.8 unless at the time of such
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acceptance such successor Trustee or successor Fiscal Agent shall be eligible
under the provisions of Section 8.6.
Upon acceptance of appointment by a successor Trustee or
successor Fiscal Agent as provided in this Section 8.8, the successor Trustee
shall mail notice of the succession of such Trustee and Fiscal Agent hereunder
to all Holders of Certificates at their addresses as shown in the Certificate
Register.
SECTION 8.9. Merger or Consolidation of Trustee.
Any corporation into which the Trustee may be merged or
converted or with which it may be consolidated or any corporation resulting
from any merger, conversion or consolidation to which the Trustee shall be a
party, or any corporation succeeding to all or substantially all of the
corporate trust business of the Trustee, shall be the successor of the Trustee
hereunder, provided that such corporation shall be eligible under the
provisions of Section 8.6, without the execution or filing of any paper or any
further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding. Any Person into which the Fiscal Agent may be merged
or converted or with which it may be consolidated or any corporation or bank
resulting from any merger, conversion or consolidation to which the Fiscal
Agent shall be a party, or any corporation or banking association succeeding
to all or substantially all of the corporate trust business of the Fiscal
Agent shall be the successor of the Fiscal Agent hereunder, provided that such
corporation or bank shall be eligible under the provisions of Section 8.6
without the execution or filing of any paper or any farther act on the part of
any of the parties hereto, anything to the contrary notwithstanding.
SECTION 8.10. Appointment of Co-Trustee or
Separate Trustee.
Notwithstanding any other provisions hereof, at any time,
for the purpose of meeting any legal requirements of any jurisdiction in which
any part of the Trust Fund or property securing the same may at the time be
located, the Depositor and the Trustee acting jointly shall have the power and
shall execute and deliver all instruments to appoint one or more Persons
approved by the Trustee to act (at the expense of the Trustee) as co-trustee
or co-trustees, jointly with the Trustee, or separate trustee or separate
trustees, of all or any part of the Trust Fund, and to vest in such Person or
Persons, in such capacity, such title to the Trust Fund, or any part thereof,
and, subject to the other provisions of this Section 8.10, such powers,
duties, obligations, rights and trusts as the Depositor and the Trustee may
consider necessary or desirable. If the Depositor shall no longer be in
existence or shall not have joined in such appointment within __ days after
the receipt by it of a request so to do, or in case an Event of Default shall
have occurred and be continuing, the Trustee alone shall have the power to
make such appointment. Except as required by applicable law, the appointment
of a co-trustee or separate trustee shall not relieve the Trustee of its
responsibilities hereunder. No co-trustee or separate trustee hereunder shall
be required to meet the terms of eligibility as a successor Trustee under
Section 8.6 hereunder and no notice to Holders of Certificates of the
appointment of co-trustee(s) or separate trustee(s) shall be required under
Section 8.8 hereof.
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In the case of any appointment of a co-trustee or separate
trustee pursuant to this Section 8.10, all rights, powers, duties and
obligations conferred or imposed upon the Trustee shall be conferred or
imposed upon and exercised or performed by the Trustee and such separate
trustee or co-trustee jointly (it being understood that such separate trustee
or co-trustee is not authorized to act separately without the Trustee joining
in such act), except to the extent that under any law of any jurisdiction in
which any particular act or acts are to be performed (whether as Trustee
hereunder or as successor to the Servicer hereunder), the Trustee shall be
incompetent or unqualified to perform such act or acts, in which event such
rights, powers, duties and obligations (including the holding of title to the
Trust Fund or any portion thereof in any such jurisdiction) shall be exercised
and performed by such separate trustee or co-trustee solely at the direction
of the Trustee.
No trustee under this Agreement shall be personally liable
by reason of any act or omission of any other trustee under this Agreement.
The Depositor and the Trustee acting jointly may at any time accept the
resignation of or remove any separate trustee or co-trustee, except that if
the Depositor is no longer in existence, or if the separate trustee or
co-trustee is an employee of the Trustee, the Trustee acting alone may accept
the resignation of or remove any separate trustee or co-trustee.
Any notice, request or other writing given to the Trustee
shall be deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement
and the conditions of this Article VIII. Every such instrument shall be filed
with the Trustee. Each separate trustee and co-trustee, upon its acceptance of
the trusts conferred, shall be vested with the estates or property specified
in its instrument of appointment, either jointly with the Trustee or
separately, as may be provided therein, subject to all the provisions of this
Agreement, specifically including every provision of this Agreement relating
to the conduct of, affecting the liability of, or affording protection to, the
Trustee. In no event shall any such separate trustee or co-trustee be entitled
to any provision relating to the conduct of, affecting the liability of, or
affording protection to such separate trustee or co-trustee that imposes a
standard of conduct less stringent than that imposed on the Trustee hereunder,
affording greater protection than that afforded to the Trustee hereunder or
providing a greater limit on liability than that provided to the Trustee
hereunder.
Any separate trustee or co-trustee may, at any time,
constitute the Trustee its agent or attorney-in-fact, with full power and
authority, to the extent not prohibited by law, to do any lawful act under or
in respect of this Agreement on its behalf and in its name. If any separate
trustee or co-trustee shall die, become incapable of acting, resign or be
removed, all of its estates, properties, rights, remedies and trusts hereunder
shall vest in and be exercised by the Trustee, to the extent permitted by law,
without the appointment of a new or successor trustee.
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SECTION 8.11. Authenticating Agent.
The Trustee may appoint an Authenticating Agent to execute
and to authenticate Certificates. The Authenticating Agent must be acceptable
to the Depositor and the Servicer and must be a corporation organized and
doing business under the laws of the United States of America or any state,
having a principal office and place of business in a state and city acceptable
to the Depositor and the Servicer, having a combined capital and surplus of at
least $_________, authorized under such laws to do a trust business and
subject to supervision or examination by federal or state authorities. The
Trustee shall serve as the initial Authenticating Agent and the Trustee hereby
accepts such appointment.
Any corporation into which the Authenticating Agent may be
merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which the
Authenticating Agent shall be party, or any corporation succeeding to the
corporate agency business of the Authenticating Agent, shall be the
Authenticating Agent without the execution or filing of any paper or any
further act on the part of the Trustee or the Authenticating Agent.
The Authenticating Agent may at any time resign by giving at
least ___ days' advance written notice of resignation to the Trustee, the
Depositor, the Special Servicer and the Servicer. The Trustee may at any time
terminate the agency of the Authenticating Agent by giving written notice of
termination to the Authenticating Agent, the Depositor, the Special Servicer
and the Servicer. Upon receiving a notice of resignation or upon such a
termination, or in case at any time the Authenticating Agent shall cease to be
eligible in accordance with the provisions of this Section 8.11, the Trustee
promptly shall appoint a successor Authenticating Agent, which shall be
acceptable to the Servicer and the Depositor, and shall mail notice of such
appointment to all Certificateholders. Any successor Authenticating Agent upon
acceptance of its appointment hereunder shall become vested with all the
rights, powers, duties and responsibilities of its predecessor hereunder, with
like effect as if originally named as Authenticating Agent herein. No
successor Authenticating Agent shall be appointed unless eligible under the
provisions of this Section 8.11.
The Authenticating Agent shall have no responsibility or
liability for any action taken by it as such at the direction of the Trustee.
The Trustee shall pay the Authenticating Agent reasonable compensation from
its own funds.
SECTION 8.12. Appointment of Custodians.
The Trustee may appoint one or more Custodians to hold all
or a portion of the Mortgage Files as agent for the Trustee, by entering into
a Custodial Agreement. The Trustee agrees to comply with the terms of each
Custodial Agreement and to enforce the terms and provisions thereof against
the Custodian for the benefit of the Certificateholders. Each Custodian shall
be a depository institution subject to supervision by federal or state
authority, shall have a combined capital and surplus of at least $_________,
shall have a long-term debt rating of at least "BBB" from each Rating Agency,
unless each of the Rating Agencies has confirmed in writing that a lower
rating shall not result, in and of itself, in a downgrading,
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withdrawal or qualification of the rating then assigned by such Rating Agency
to any Class of the Certificates, and shall be qualified to do business in the
jurisdiction in which it holds any Mortgage File. Each Custodial Agreement may
be amended only as provided in Section 10.7. The Trustee shall pay the
Custodian reasonable compensation from its own funds. The Trustee shall serve
as the initial Custodian.
SECTION 8.13. Fiscal Agent Appointed; Concerning
the Fiscal Agent.
(a) The Trustee hereby appoints as the initial Fiscal Agent
hereunder for the purposes of exercising and performing the obligations and
duties imposed upon the Fiscal Agent by Sections 3.22, 4.6 and 7.2.
(b) The Fiscal Agent undertakes to perform such duties and
only such duties as are specifically set forth in Sections 3.22, 4.6 and 7.2.
(c) No provision of this Agreement shall be construed to
relieve the Fiscal Agent from liability for its own negligent failure to act,
bad faith or its own willful misfeasance; provided, however, that (i) the
duties and obligations of the Fiscal Agent shall be determined solely by the
express provisions of Sections 3.22, 4.6 and 7.2, the Fiscal Agent shall not
be liable except for the performance of such duties and obligations, no
implied covenants or obligations shall be read into this Agreement against the
Fiscal Agent and, in the absence of bad faith on the part of the Fiscal Agent,
the Fiscal Agent may conclusively rely, as to the truth and correctness of the
statements or conclusions expressed therein, upon any resolutions,
certificates, statements, opinions, reports, documents, orders or other
instruments furnished to the Fiscal Agent by the Depositor, the Servicer, the
Special Servicer or the Trustee and which on their face do not contradict the
requirements of this Agreement, and (ii) the provisions of clause (ii) of
Section 8.1(c) shall apply to the Fiscal Agent.
(d) Except as otherwise provided in Section 8.1(c), the
Fiscal Agent also shall have the benefit of provisions of clauses (i), (ii),
(iii) (other than the proviso thereto), (iv), (v) (other than the proviso
thereto) and (vi) of Section 8.2(a).
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ARTICLE IX
TERMINATION
SECTION 9.1. Termination.
(a) The respective obligations and responsibilities of the
Servicer, the Special Servicer, the Depositor, the Trustee and the Fiscal
Agent created hereby with respect to the Certificates (other than the
obligation to make certain payments and to send certain notices to
Certificateholders as hereinafter set forth) shall terminate immediately
following the occurrence of the last action required to be taken by the
Trustee pursuant to this Article IX on the Termination Date; provided,
however, that in no event shall the trust created hereby continue beyond the
expiration of twenty-one years from the death of the survivor of the
descendants of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, the late ambassador of the United States to
the United Kingdom, living on the date hereof.
(b) The Trust Fund, the Upper-Tier REMIC and the Lower-Tier
REMIC shall be terminated and the assets of the Trust Fund shall be sold or
otherwise disposed of in connection therewith, only pursuant to a "plan of
complete liquidation" within the meaning of Code Section 860F(a)(4)(A)
providing for the actions contemplated by the provisions hereof pursuant to
which the applicable Notice of Termination is given and requiring that the
Trust Fund, the Upper-Tier REMIC and the Lower-Tier REMIC shall terminate on a
Distribution Date occurring not more than ___ days following the date of
adoption of the plan of complete liquidation. For purposes of this Section
9.1(b), the Notice of Termination given pursuant to Section 9.1(c) shall
constitute the adoption of the plan of complete liquidation as of the date
such notice is given, which date shall be specified by the Trustee in the
final federal income tax returns of the Upper-Tier REMIC and the Lower- Tier
REMIC.
(c) If the Trust Fund has not been previously terminated
pursuant to subsection (d) of this Section 9.1, the Special Servicer may
effect an early termination of the Trust Fund, upon not less than ___ days'
prior Notice of Termination given to the Trustee and the Servicer any time on
or after the Early Termination Notice Date specifying the Anticipated
Termination Date, by purchasing on such date all, but not less than all, of
the Mortgage Loans then included in the Trust Fund, and all property acquired
in respect of any Mortgage Loan, at a purchase price, payable in cash, equal
to not less than the greater of:
(i) the sum of
(A) ___% of the unpaid principal balance of
each Mortgage Loan included in the Trust
Fund as of the ___ day of the month
preceding such Distribution Date;
(B) the fair market value of all other
property included in the Trust Fund as of
the ____ day of the month preceding such
Distribution Date, as determined by an
Independent appraiser acceptable to the
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Servicer as of the date not more than __
days prior to the ____ day of the month
preceding such Distribution Date;
(C) all unpaid interest accrued on such
principal balance of each such Mortgage
Loan (including for this purpose any
Mortgage Loan as to which title to the
related Mortgaged Property has been
acquired) at the Mortgage Rate to the ____
day of the month preceding such
Distribution Date;
(D) the aggregate amount of unreimbursed
Advances (with interest thereon at the
Advance Rate) and unpaid Trust Fund
expenses; or
(ii) the aggregate fair market value of the Mortgage
Loans, and all other property acquired in respect
of any Mortgage Loan in the Trust Fund, on the ____
day of the month preceding such Distribution Date,
as determined by an Independent appraiser
acceptable to the Servicer as of a date not more
than ___ days prior to the _____ day of the month
preceding such Distribution Date, together with
____ month's interest thereon at the Mortgage Rate
and disposition expenses.
Any Holder of a Class Certificate representing greater than
a __% Percentage Interest in such Class, the Servicer or the Depositor may
also effect such termination as provided above if it first notifies the
Special Servicer through the Trustee of its intention to do so in writing at
least __ days prior to the Early Termination Notice Date and the Special
Servicer does not terminate the Trust Fund as described above within such __
day period. All costs and expenses incurred by any party to this Agreement or
by the Trust Fund in connection with the purchase of the Mortgage Loans and
other assets of the Trust Fund pursuant to this Section 9.1(c) shall be borne
by the party exercising its purchase rights hereunder. The Trustee shall be
entitled to rely conclusively on any determination made by an Independent
appraiser pursuant to this subsection (c).
(d) If the Trust Fund has not been previously terminated
pursuant to subsection (c) of this Section 9.1, on or after the Auction
Valuation Date, the Trustee shall conduct an auction of the Mortgage Loans in
accordance with the following principles:
(i) The Trustee shall request that four Independent
financial advisory or investment banking or
investment brokerage firms nationally recognized in
the field of real estate analysis and reasonably
acceptable to the Servicer and the Special Servicer
provide the Trustee with an estimated value at
which the Mortgage Loans and all other property in
respect of any Mortgage Loan in the Trust Fund
could be sold at an auction. If the aggregate value
of the Mortgage Loans and such property, as
determined by the average of the three highest such
estimates, equals or exceeds the aggregate amount
of the Certificate Balances of all Certificates
outstanding as of the close of business on the
Auction Valuation Date (the "Aggregate Certificate
Balance") plus the Auction Fees, Servicing Fees,
Trustee Fees
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and all other incidental expenses, the Trustee
shall (A) adopt a "plan of complete liquidation",
as required by Section 9.1(b) hereof, and (B)
appoint an Auction Agent to solicit offers from
Qualified Offerors to purchase all (but not less
than all) of the Mortgage Loans and such property
in accordance with the Auction Procedures for a
price that is not less than the Aggregate
Certificate Balance plus the Auction Fees,
Servicing Fees, Trustee Fees and all other
incidental expenses. In the event that there is an
auction of the Mortgage Loans and such property the
Auction Agent shall be authorized to employ
Independent attorneys and other Independent
professional consultants (including, without
limitation, appraisers and environmental
consultants) as reasonably required to conduct such
sale.
(ii) In determining the Aggregate Certificate Balance,
there shall be included all Certificates owned by
or on behalf of the Depositor, the Servicer, the
Trustee, a Manager or a Borrower or any Affiliate
thereof, notwithstanding the proviso in the first
sentence of the definition of the term
"Certificateholder."
(iii) The Trustee shall reject every bid that the Auction
Agent advises the Trustee in writing (a) is from a
Person other than a Qualified Offeror, (b) provides
for a purchase price that is less than the
Aggregate Certificate Balance plus the Auction
Fees, Servicing Fees, Trustee Fees and all other
incidental expenses, (c) provides for purchase on
terms other than all-cash or (d) is contingent on
the occurrence or non-occurrence of any event
(each, a "Deficient Auction Bid"). If all bids
received by the Trustee are Deficient Auction Bids,
as advised by the Auction Agent, the Mortgage Loans
and such property shall not be sold and there shall
be no termination of the Trust Fund pursuant to
this Section 9.1(d).
(iv) The Trustee shall accept the highest bid that is
not a Deficient Auction Bid and shall deliver a
Notice of Termination to the Servicer, the Special
Servicer and the Certificateholders specifying the
Anticipated Termination Date (which shall be first
Distribution Date following the date of closing of
the sale of the Mortgage Loans and such property).
The Trustee shall sell the Mortgage Loans and such
property to the successful bidder at a closing to
be held no later than the Remittance Date
immediately preceding the Auction Proceeds
Distribution Date.
(v) The Trustee shall be entitled to be reimbursed from
the Collection Account for expenses (which shall be
deemed to be expenses of the Trust Fund) that it or
the Auction Agent on its behalf incurs pursuant to
this Section 9.1(d) in connection with the
valuation and sale of the Mortgage Loans and such
property (collectively, the "Auction Fees"),
including all fees and reasonable expenses of legal
counsel and other professional consultants retained
by either of the Trustee or the Auction Agent. The
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Trustee shall not be personally liable for any act
or omission of the Auction Agent hereunder or any
Independent attorneys and other Independent
professional consultants appointed by the Auction
Agent.
(vi) Any auction shall be conducted in accordance with
auction procedures to be developed by the auction
agent in connection with such auction (the "Auction
Procedures"), provided that such procedures shall
include at a minimum provisions substantially to
the effect that: (i) no due diligence of the
Servicer's, the Special Servicer's or the Trustee's
records with respect to the Mortgage Loans may be
conducted by any bidder prior to being notified
that it has submitted the highest bid; (ii) the
Auction Agent is entitled to require that the
highest bidder provide a non-refundable good faith
deposit sufficient to reimburse the Trustee and the
Auction Agent for all expenses in connection with
the evaluation of such bid and in connection with
such highest bidder's due diligence, (iii) each
bidder may be required to enter into a
confidentiality agreement with the Servicer, the
Special Servicer, the Auction Agent and the Trustee
prior to being permitted to conduct due diligence,
(iv) Borrowers on any of the Mortgage Loans shall
be prohibited from submitting bids, and (v) in the
event that the highest bidder withdraws, the next
highest bidder shall be permitted to conduct due
diligence as if it were the highest bidder.
(e) If the Trust Fund has not been previously terminated
pursuant to subsection (c) or (d) of this Section 9.1, the Trustee shall
determine as soon as practicable the Distribution Date on which the Trustee
reasonably anticipates, based on information with respect to the Mortgage
Loans previously provided to it, that the final distribution will be made (i)
to the Holders of outstanding Regular Certificates, and to the Trustee in
respect of the Lower-Tier Regular Interests notwithstanding that such
distribution may be insufficient to distribute in full the Certificate Balance
of each Certificate or Lower-Tier Regular Interest, together with amounts
required to be distributed on such Distribution Date pursuant to Section
4.1(a) or (ii) if no such Classes of Certificates are then outstanding, to the
Holders of the Class Certificates of any amount remaining in the Collection
Account and to the Holders of the Class Certificates of any amount remaining
in the Distribution Account, in either case, following the later to occur of
(A) the receipt or collection of the last payment due on any Mortgage Loan
included in the Trust Fund or (B) the liquidation or disposition pursuant to
Section 3.18 of the last asset held by the Trust Fund.
(f) Notice of any termination of the Trust Fund pursuant to
this Section 9.1 shall be mailed by the Trustee to affected Certificateholders
with a copy to the Servicer and each Rating Agency at their addresses shown in
the Certificate Registrar as soon as practicable after the Trustee shall have
received, given or been deemed to have received a Notice of Termination but in
any event not more than ____ days, and not less than ____ days, prior to the
Anticipated Termination Date. The notice mailed by the Trustee to affected
Certificateholders shall:
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(i) specify the Anticipated Termination Date on which
the final distribution is anticipated to be made to
Holders of Certificates of the Classes specified
therein;
(ii) specify the amount of any such final distribution,
if known; and
(iii) state that the final distribution to
Certificateholders will be made only upon
presentation and surrender of Certificates at the
office of the Paying Agent therein specified.
If the Trust Fund is not terminated on any Anticipated Termination Date for
any reason, the Trustee shall promptly mail notice thereof to each affected
Certificateholder.
(g) Any funds not distributed on the Termination Date
because of the failure of any Certificateholders to tender their Certificates
shall be set aside and held in trust for the account of the appropriate
non-tendering Certificateholders, whereupon the Trust Fund shall terminate. If
any Certificates as to which notice of the Termination Date has been given
pursuant to this Section 9.1 shall not have been surrendered for cancellation
within ___ months after the time specified in such notice, the Trustee shall
mail a second notice to the remaining Certificateholders, at their last
addresses shown in the Certificate Register, to surrender their Certificates
for cancellation in order to receive, from such funds held, the final
distribution with respect thereto. If within one year after the second notice
any Certificate shall not have been surrendered for cancellation, the Trustee
may, directly or through an agent, take appropriate steps to contact the
remaining Certificateholders concerning surrender of their Certificates. The
costs and expenses of maintaining such funds in trust and of contacting
Certificateholders shall be paid out of such funds. If within two years after
the second notice, any such Certificates shall not have been surrendered for
cancellation, the Paying Agent shall pay to the Servicer all amounts
distributable to the Holders thereof, at which time the obligations of the
Trustee to such Holders with respect to such amounts shall terminate, and the
Servicer shall thereafter hold such amounts for the benefit of such Holders.
No interest shall accrue or be payable to any Certificateholder on any amount
held as a result of such Certificateholder's failure to surrender its
Certificate(s) for final payment thereof in accordance with this Section 9.1.
Such funds held by the Servicer shall not be invested.
SECTION 9.2. Additional Termination Requirements.
In the event that (a) the holder of a Class Certificate
representing greater than a __% Percentage Interest in such Class, the
Servicer or the Depositor exercises its purchase option as provided in Section
9.1(c) or (b) the procedures for sale of all Mortgage Loans as provided in
Section 9.1(d) are initiated, the Trust Fund shall be terminated in accordance
with the following additional requirements: provided that the Trustee has
received an Opinion of Counsel or other evidence to the effect that the
termination of the Trust Fund (i) will constitute a "qualified liquidation" of
each of the Upper-Tier REMIC and the Lower-Tier REMIC within the meaning of
Code Section 860F(a)(4)(A-3) and (ii) will not subject either the Upper-Tier
REMIC or the Lower-Tier REMIC to tax or cause either the Upper-Tier REMIC or
the Lower-Tier REMIC to fail to qualify as a REMIC at any time that any
Certificates are outstanding:
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(a) The notice given by the holder of a Class ______
Certificate representing greater than a __% Percentage Interest in such Class,
under Section 9.1 shall provide that such notice constitutes the adoption of a
plan of complete liquidation of the Trust Fund as of the date of such notice
(or, if earlier, the date on which the first such notice is mailed to the
Trustee and the Servicer). The Trustee shall also specify such date in a
statement attached to the final tax returns of each of the Upper-Tier REMIC
and the Lower-Tier REMIC; and
(b) At or after the time of adoption of such a plan of
complete liquidation and at or prior to the Final Distribution Date, the
Trustee shall sell all of the assets of the Trust Fund to the holder of such
Class ______ Certificates, the Servicer or the Depositor (or otherwise
pursuant to the provisions of Section 9.1(d)) for cash at the purchase price
specified in Section 9.1 and shall distribute such cash in the manner
specified in Section 9.1.
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ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.1. Counterparts.
This Agreement may be executed simultaneously in any number
of counterparts, each of which counterparts shall be deemed to be an original,
and such counterparts shall constitute but one and the same instrument.
SECTION 10.2. Limitation on Rights of
Certificateholders.
The death or incapacity of any Certificateholder shall not
operate to terminate this Agreement or the Trust Fund, nor entitle such
Certificateholder's legal representatives or heirs to claim an accounting or
to take any action or proceeding in any court for a partition or winding up of
the Trust Fund, nor otherwise affect the rights, obligations and liabilities
of the parties hereto or any of them.
No Certificateholder shall have any right to vote (except as
expressly provided for herein) or in any manner otherwise control the
operation and management of the Trust Fund, or the obligations of the parties
hereto, nor shall anything herein set forth, or contained in the terms of the
Certificates, be construed so as to constitute the Certificateholders from
time to time as partners or members of an association; nor shall any
Certificateholder be under any liability to any third person by reason of any
action taken by the parties to this Agreement pursuant to any provision
hereof.
No Certificateholder shall have any right to institute any
suit, action or proceeding in equity or at law upon or under or with respect
to this Agreement or the Mortgage Loans, unless, with respect to this
Agreement, such Holder previously shall have given to the Trustee a written
notice of default and of the continuance thereof, as hereinbefore provided,
and unless also the Holders of Certificates representing at least __% of the
aggregate Voting Rights allocated to each affected Class of Certificates shall
have made written request upon the Trustee to institute such action, suit or
proceeding in its own name as Trustee hereunder and shall have offered to the
Trustee such reasonable indemnity as it may require against the costs,
expenses and liabilities to be incurred therein or thereby, and the Trustee,
for ___ days after its receipt of such notice, request and offer of indemnity,
shall have neglected or refused to institute any such action, suit or
proceeding. It is understood and intended, and expressly covenanted by each
Certificateholder with every other Certificateholder and the Trustee, that no
one or more Holders of Certificates of any Class shall have any right in any
manner whatever by virtue of any provision of this Agreement to affect,
disturb or prejudice the rights of the Holders of any other of such
Certificates, or to obtain or seek to obtain priority over or preference to
any other such Holder, or to enforce any right under this Agreement, except in
the manner herein provided and for the equal, ratable and common benefit of
all Holders of Certificates of such Class. For the protection and enforcement
of the provisions of this Section, each and every Certificateholder and the
Trustee shall be entitled to such relief as can be given either at law or in
equity.
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SECTION 10.3. Governing Law.
THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES)
AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.
SECTION 10.4. Notices.
All demands, notices and communications hereunder shall be
in writing, shall be deemed to have been given upon receipt (or, in the case
of notice by telecopy, upon confirmation of receipt) as follows:
If to the Trustee or the Fiscal Agent, to:
____________ or ______________
Attention:
With copies to:
If to the Depositor, to:
Prudential Securities Secured Financing
Corporation
▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Head of Commercial Mortgage
Group
With copies to:
O'Melveny & ▇▇▇▇▇
Citicorp Center
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
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If to the Servicer, to:
----------------------------
-----------------------------
Attention: _________________
Telecopy No.: (___) ________
With copies to:
------------------------
-----------------
___________, __________
Attention: _______________________
Telecopy No.: (___) ________
If to the Special Servicer, to:
---------------------
-----, ------- ------
Attention: ________________
Telecopy No.: (___) ________
With copies to:
---------------------------------
---------------------------------
-----, ------- -----
Attention: _______________
Telecopy No.: (___) ________
If to the Mortgage Loan Seller, to:
----------------------------
---------------, ------ -----
Attention: _________________
Telecopy No.: (___) ________
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With copies to:
------------------------
-------------------
___________, __________
Attention: _______________________
Telecopy No.: (___) ________
If to any Certificateholder, to:
the address set forth in the
Certificate Register,
or, in the case of the parties to this Agreement, to such other address as
such party shall specify by written notice to the other parties hereto.
SECTION 10.5. Severability of Provisions.
If any one or more of the covenants, agreements, provisions
or terms of this Agreement shall be for any reason whatsoever held invalid,
then, to the extent permitted by applicable law, such covenants, agreements,
provisions or terms shall be deemed severable from the remaining covenants,
agreements, provisions or terms of this Agreement and shall in no way affect
the validity or enforceability of the other provisions of this Agreement or of
the Certificates or the rights of the Holders thereof.
SECTION 10.6. Notice to the Depositor and Each
Rating Agency.
(a) The Trustee shall use its best efforts to promptly
provide written notice to the Depositor and each Rating Agency with respect to
each of the following of which a Responsible Officer of the Trustee has actual
knowledge:
(i) any material change or amendment to this Agreement;
(ii) the occurrence of any Event of Default that has not
been cured;
(iii) the merger, consolidation, resignation or
termination of the Servicer, Special Servicer,
Trustee or Fiscal Agent;
(iv) the repurchase of Mortgage Loans pursuant to
Section 2.3(d) or 2.3(e);
(v) the final payment to any Class of
Certificateholders;
(vi) each report to Certificateholders described in
Section 4.2;
(b) The Servicer shall promptly furnish to each Rating
Agency copies of the following:
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(i) each of its annual statements as to compliance
described in Section 3.14;
(ii) each of its annual independent public accountants'
servicing reports described in Section 3.15.
(iii) annual reports of each Borrower with respect to the
net operating income and occupancy rates required
to be delivered by the related Mortgage and
actually received by the Servicer pursuant thereto
to the extent consistent with applicable law and
the related Mortgage Loan Documents.
(c) The Special Servicer, shall furnish each Rating Agency
with such information with respect to any Specially Serviced Mortgage Loan as
such Rating Agency shall request and which the Special Servicer can obtain to
the extent consistent with applicable law and the related Mortgage Loan
Documents.
(d) Notices to each Rating Agency shall be addressed as
follows:
or in each case to such other address as any Rating Agency shall specify by
written notice to the parties hereto.
SECTION 10.7. Amendment.
This Agreement or any Custodial Agreement may be amended
from time to time by the Depositor, the Servicer, the Special Servicer, the
Trustee and the Fiscal Agent, without the consent of any of the
Certificateholders, (i) to cure any ambiguity, (ii) to correct or supplement
any provisions herein or therein that may be inconsistent with any other
provisions herein or therein, (iii) to amend any provision hereof to the
extent necessary or desirable to maintain the rating or ratings assigned to
each of the Classes of Regular Certificates by each Rating Agency, or (iv) to
make any other provisions with respect to matters or questions arising under
this Agreement, which shall not be inconsistent with the provisions of this
Agreement and will not result in the downgrading, withdrawal or qualification
of the rating or ratings then assigned to any outstanding Class of
Certificates, as confirmed by each Rating Agency in writing and, in all cases,
which, as evidenced by an Opinion of Counsel at the expense of the party
(other than the Trustee, unless such amendment modifies or otherwise relates
solely to the
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obligations, duties or rights of the Trustee) requesting such amendment, shall
not adversely affect in any material respect the interests of any
Certificateholder.
This Agreement or any Custodial Agreement may also be
amended from time to time by the Depositor, the Servicer, the Special
Servicer, the Trustee and the Fiscal Agent with the consent of the Holders of
each of the Classes of Regular Certificates representing not less than ___% of
the aggregate Voting Rights allocated to each Class of Certificates affected
by the amendment for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Agreement or of
modifying in any manner the rights of the Certificateholders; provided,
however, that no such amendment shall:
(i) reduce in any manner the amount of, or delay the
timing of, payments received on Mortgage Loans
which are required to be distributed on any
Certificate without the consent of each affected
Certificateholder;
(ii) change the percentages of Voting Rights of Holders
of Certificates which are required to consent to
any action or inaction under this Agreement,
without the consent of the Holders of all
Certificates then outstanding; or
(iii) alter the servicing standard set forth in Section
3.1 or the obligations of the Servicer, the Trustee
or the Fiscal Agent to make a P&I Advance or
Property Advance without the consent of the Holders
of all Certificates representing all of the Voting
Rights of the Class or Classes affected thereby.
Further, the Depositor, the Servicer, the Special Servicer,
the Trustee and the Fiscal Agent, at any time and from time to time, without
the consent of the Certificateholders, may amend this Agreement or any
Custodial Agreement to modify, eliminate or add to any of its provisions to
such extent as shall be necessary to maintain the qualification of the Trust
REMICs as two separate REMICs, or to prevent the imposition of any additional
material state or local taxes, at all times that any Certificates are
outstanding; provided, however, that such action, as evidenced by an Opinion
of Counsel (obtained at the expense of the Trust Fund), is necessary or
helpful to maintain such qualification or to prevent the imposition of any
such taxes, and would not adversely affect in any material respect the
interest of any Certificateholder.
In the event that neither the Depositor nor the successor
thereto, if any, is in existence, any amendment under this Section 10.7 shall
be effective with the consent in writing of the Trustee, the Fiscal Agent, the
Servicer, the Special Servicer, and, to the extent required by this Section,
the Certificateholders and each Rating Agency.
Promptly after the execution of any amendment, the Servicer
shall furnish written notification of the substance of such amendment to each
Certificateholder and each Rating Agency.
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It shall not be necessary for the consent of
Certificateholders under this Section 10.7 to approve the particular form of
any proposed amendment, but it shall be sufficient if such consent shall
approve the substance thereof. The method of obtaining such consents and of
evidencing the authorization of the execution thereof by Certificateholders
shall be subject to such reasonable regulations as the Trustee may prescribe;
provided, however, that such method shall always be by affirmation and in
writing.
Notwithstanding any contrary provision of this Agreement, no
amendment shall be made to this Agreement or any Custodial Agreement unless
the Servicer and the Trustee shall have received an Opinion of Counsel, at the
expense of the party requesting such amendment (or, if such amendment is
required by any Rating Agency to maintain the rating issued by it or requested
by the Trustee for any purpose described in clause (i) or (ii) of the first
sentence of this Section, then at the expense of the Trust Fund), to the
effect that such amendment will not cause either the Upper-Tier REMIC or
Lower-Tier REMIC to fail to qualify as a REMIC at any time that any
Certificates are outstanding or cause a tax to be imposed on the Trust Fund
under the REMIC Provisions (other than a tax at the highest marginal corporate
tax rate on net income from foreclosure property).
Prior to the execution of any amendment to this Agreement or
any Custodial Agreement, the Trustee, the Fiscal Agent, the Special Servicer
and the Servicer shall be entitled to receive and rely conclusively upon an
Opinion of Counsel, at the expense of the party requesting such amendment (or,
if such amendment is required by any Rating Agency to maintain the rating
issued by it or requested by the Trustee for any purpose described in clause
(i), (ii) or (iv) (which do not modify or otherwise relate solely to the
obligations, duties or rights of the Trustee) of the first sentence of this
Section, then at the expense of the Trust Fund) stating that the execution of
such amendment is authorized or permitted by this Agreement. The Trustee may,
but shall not be obligated to, enter into any such amendment which affects the
Trustee's own rights, duties or immunities under this Agreement.
SECTION 10.8. Confirmation of Intent.
It is the express intent of the parties hereto that the
conveyance of the Trust Fund (including the Mortgage Loans) by the Depositor
to the Trustee on behalf of Certificateholders as contemplated by this
Agreement and the sale by the Depositor of the Certificates be, and be treated
for all purposes as, a sale by the Depositor of the undivided portion of the
beneficial interest in the Trust Fund represented by the Certificates. It is,
further, not the intention of the parties that such conveyance be deemed a
pledge of the Trust Fund by the Depositor to the Trustee to secure a debt or
other obligation of the Depositor. However, in the event that, notwithstanding
the intent of the parties, the Trust Fund is held to continue to be property
of the Depositor then (a) this Agreement shall also be deemed to be a security
agreement under applicable law; (b) the transfer of the Trust
Fund provided for herein shall be deemed to be a grant by the Depositor to the
Trustee on behalf of Certificateholders of a first priority security interest
in all of the Depositor's right, title and interest in and to the Trust Fund
and all amounts payable to the holders of the Mortgage Loans in accordance
with the terms thereof and all proceeds of the conversion, voluntary or
involuntary, of the foregoing into cash, instruments, securities or other
property, including, without limitation, all amounts from time to time held
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or invested in the Collection Account and the Distribution Account, whether in
the form of cash, instruments, securities or other property; (c) the
possession by the Trustee (or the Custodian on its behalf) of 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
and ________ Uniform Commercial Codes; and (d) notifications to Persons
holding such property, and acknowledgments, receipts or confirmations from
Persons holding such property, shall be deemed notifications to, or
acknowledgments, receipts or confirmations from, financial intermediaries,
bailees or agents (as applicable) of the Trustee for the purpose of perfecting
such security interest under applicable law. Any assignment of the interest of
the Trustee pursuant to any provision hereof shall also be deemed to be an
assignment of any security interest created hereby. The Depositor shall, and
upon the request of the Servicer, the Trustee shall, to the extent consistent
with this Agreement (and at the expense of the Trust Fund), take such actions
as may be necessary to ensure that, if this Agreement were deemed to create a
security interest in the Mortgage Loans, such security interest would be
deemed to be a perfected security interest of first priority under applicable
law and will be maintained as such throughout the term of this Agreement. It
is the intent of the parties that such a security interest would be effective
whether any of the Certificates are sold, pledged or assigned.
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IN WITNESS WHEREOF, the Depositor, the Servicer, the Special
Servicer, the Trustee and the Fiscal Agent have caused their names to be
signed hereto by their respective officers thereunto duly authorized as of the
day and year first above written.
Signed and acknowledged PRUDENTIAL SECURITIES SECURED
in the presence of: FINANCING CORPORATION
as Depositor
------------------------------
Print Name:
------------------------------- By: ___________________________
Print Name: Name:
Title
Signed and acknowledged --------------
in the presence of: as Servicer
-----------------------------
Print Name: By: ___________________
its General Partner
----------------------------- By: _________________________
Print Name: Name:
Title:
Signed and acknowledged ----------------------
in the presence of: as Special Servicer
------------------------------- By: _________________________
Print Name: Name:
Title:
-------------------------------
Print Name:
------------------------------
Signed and acknowledged as Trustee, Custodian, Certificate
in the presence of: Registrar and Paying Agent
-------------------------------
Print Name:
------------------------------- By: __________________________
Print Name: Name:
Title: Vice President
Signed and acknowledged -----------------
in the presence of: as Fiscal Agent of the Trustee
-------------------------------
Print Name:
------------------------------- By: __________________________
Print Name: Name:
Title:
NY1-585655.V1 04/09/98
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On this ___th day of _________ , before me appeared
_____________________ to me personally known, who being by me duly sworn did
say that he is a ______________ of PRUDENTIAL SECURITIES SECURED FINANCING
CORPORATION, a Delaware corporation and that he signed his name thereto under
authority of the board of directors of said corporation and on behalf of such
corporation.
WITNESS my hand and seal hereto affixed the day and year
first above written.
NOTARY PUBLIC in and for said
County and State
My Commission expires:
(stamp)
(seal)
STATE OF _______ )
) ss.:
COUNTY OF _______ )
On this ___th day of _________ , before me appeared
____________________, to me personally known, who being by me duly sworn did
say that he is a [Title] of _________, a ________ corporation, the general
partner of _________, a _______________________, and that the seal affixed to
the foregoing instrument is the corporate seal of said corporation, and that
said instrument was signed and sealed on behalf of said corporation by
authority of its board of directors as the general partner of said
___________________, and said __________________ acknowledged said instrument
to be the free act and deed of said corporation as the general partner of said
_________________ and the free act and deed of said ________________.
WITNESS my hand and seal hereto affixed the day and year
first above written.
------------------------------
NOTARY PUBLIC in and for said
County and State
My Commission expires:
(stamp)
(seal)
STATE OF )
) ss.:
COUNTY OF )
On this ___th day of _______ , before me appeared
____________________, to me personally known, who being by me duly sworn did
say that he is a [Title] of the _______ a corporation, and that the seal
affixed to the foregoing instrument is the corporate seal of said corporation,
and that said instrument was signed and sealed on behalf of said corporation
by authority of its board of directors, and said __________________
acknowledged said instrument to be the free act and deed of said corporation
and the free act and deed of said corporation.
WITNESS my hand and seal hereto affixed the day and year
first above written.
-------------------------------
NOTARY PUBLIC in and for said
County and State
My Commission expires:
(stamp)
(seal)
STATE OF ________ )
) ss.:
COUNTY OF ________ )
On this ___th day of ________ , before me, the undersigned,
a Notary Public in and for the State of ________, duly commissioned and sworn,
personally appeared _____________________, to me known who, by me duly sworn,
did depose and acknowledge before me and say that he resides at _____________;
that he is the _____________________ of ____________ , a nationally chartered
bank, the corporation described in and that executed the foregoing instrument;
and that he signed his name thereto under authority of the board of directors
of said corporation and on behalf of such corporation.
WITNESS my hand and seal hereto affixed the day and year
first above written.
----------------------------
NOTARY PUBLIC in and for the
State of New York.
My Commission expires:
(stamp)
(seal)
This instrument prepared by:
----------------------------
Name:
-------------
Address:
STATE OF ________ )
) ss.:
COUNTY OF _______ )
On the ___th day of , before me, ________________, a Notary
Public in and for said State, personally appeared _____________________,
___________________ and __________________, _____________________, personally
known to me or proved to me on the basis of satisfactory evidence to be the
persons whose names are subscribed to the within instrument and acknowledged
to me that they executed the same in their authorized capacity, and that by
their signatures on the instrument the corporation upon behalf of which the
person acted executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed
my official seal the day and year in this certificate first above written.
-----------------------------
NOTARY PUBLIC
My commission expires ___________________