EXHIBIT 10.1
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EXECUTION VERSION
MASTER REPURCHASE AGREEMENT
Between:
▇▇▇▇▇▇ Commercial Paper Inc., as Buyer
and
Anthracite Capital, Inc., as Seller
Dated as of May 1, 2007
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TABLE OF CONTENTS
Page
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SECTION 1. APPLICABILITY...................................................1
SECTION 2. DEFINITIONS.....................................................1
SECTION 3. INITIATION; TERMINATION........................................20
SECTION 4. MARGIN AMOUNT MAINTENANCE......................................26
SECTION 5. INCOME PAYMENTS................................................26
SECTION 6. REQUIREMENTS OF LAW............................................27
SECTION 7. TAXES..........................................................28
SECTION 8. SECURITY INTEREST; BUYER'S APPOINTMENT AS ATTORNEY-IN-FACT.....31
SECTION 9. PAYMENT, TRANSFER AND CUSTODY..................................34
SECTION 10. FEES...........................................................35
SECTION 11. REPRESENTATIONS................................................35
SECTION 12. COVENANTS......................................................40
SECTION 13. EVENTS OF DEFAULT..............................................47
SECTION 14. REMEDIES.......................................................49
SECTION 15. INDEMNIFICATION AND EXPENSES; RECOURSE.........................52
SECTION 16. SERVICING......................................................53
SECTION 17. DUE DILIGENCE..................................................54
SECTION 18. ASSIGNABILITY..................................................54
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SECTION 19. TRANSFER AND MAINTENANCE OF REGISTER...........................55
SECTION 20. HYPOTHECATION OR PLEDGE OF PURCHASED ASSETS....................56
SECTION 21. TAX TREATMENT..................................................56
SECTION 22. SET-OFF........................................................56
SECTION 23. TERMINABILITY..................................................56
SECTION 24. NOTICES AND OTHER COMMUNICATIONS...............................57
SECTION 25. ENTIRE AGREEMENT; SEVERABILITY; SINGLE AGREEMENT...............57
SECTION 26. GOVERNING LAW..................................................58
SECTION 27. SUBMISSION TO JURISDICTION; WAIVERS............................58
SECTION 28. NO WAIVERS, ETC................................................59
SECTION 29. NETTING........................................................59
SECTION 30. CONFIDENTIALITY................................................59
SECTION 31. INTENT.........................................................60
SECTION 32. DISCLOSURE RELATING TO CERTAIN FEDERAL PROTECTIONS.............61
SECTION 33. AUTHORIZATIONS.................................................61
SECTION 34. RESERVED.......................................................61
SECTION 35. MISCELLANEOUS..................................................61
SECTION 36. GENERAL INTERPRETIVE PRINCIPLES................................62
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EXHIBITS
SCHEDULE 1 Representations and Warranties Re: Purchased Assets
SCHEDULE 2 Existing Indebtedness
SCHEDULE 3 UCC Filing Jurisdiction
SCHEDULE 4 Authorized Representatives
SCHEDULE 5 Responsible Officers
EXHIBIT A Form of Opinion Letter
EXHIBIT B Form of Control Agreement
EXHIBIT C Purchased Asset Schedule Fields
EXHIBIT D Eligible Asset Documents
EXHIBIT E Underwriting Guidelines
EXHIBIT F Seller's Officer's Certificate
EXHIBIT G Form of Servicer Notice
EXHIBIT H Form of Section 7 Certificate
EXHIBIT I Reserved
EXHIBIT J Reserved
EXHIBIT K Form of Purchase Confirmation
EXHIBIT L Form of Transaction Request
EXHIBIT M Form of Servicing Report
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MASTER REPURCHASE AGREEMENT
This is a MASTER REPURCHASE AGREEMENT, dated as of May 1, 2007,
between ANTHRACITE CAPITAL, INC., a Maryland corporation (the "Seller") and
▇▇▇▇▇▇ COMMERCIAL PAPER INC., a New York corporation (the "Buyer").
SECTION 1. APPLICABILITY
From time to time the parties hereto may enter into transactions in
which Seller agrees to transfer to Buyer Purchased Assets (as hereinafter
defined) against the transfer of funds by Buyer, with a simultaneous agreement
by Buyer to transfer to Seller such Purchased Assets at a date certain or on
demand, against the transfer of funds by Seller. Each such transaction shall
be referred to herein as a "Transaction" and, unless otherwise agreed in
writing, shall be governed by this Repurchase Agreement, including any
supplemental terms or conditions contained in any annexes identified herein,
as applicable hereunder.
SECTION 2. DEFINITIONS
As used herein, the following terms shall have the following meanings
(all terms defined in this Section 2 or in other provisions of this Repurchase
Agreement in the singular to have the same meanings when used in the plural
and vice versa)
"1934 Act" shall have the meaning set forth in Section 32 hereof.
"Accepted Servicing Practices" shall mean, with respect to any
Purchased Asset, those mortgage servicing practices of prudent mortgage
lending institutions which service assets of the same type as such Purchased
Asset in the jurisdiction where the related Mortgaged Property or underlying
asset is located.
"Additional Purchased Assets" shall mean Eligible Assets or cash
provided by the Seller to Buyer or its designee pursuant to Section 4 of this
Repurchase Agreement.
"Adjusted Net Income" shall mean for any period the Net Income of the
Seller and its Subsidiaries determined on a cash basis for such period without
recognizing any trading portfolio gains or losses in general, and specifically
without giving effect to:
(a) depreciation and amortization,
(b) gains or losses that are classified as "extraordinary" in
accordance with GAAP,
(c) capital gains or losses on sales of real estate,
(d) capital gains or losses with respect to the disposition of
investments in marketable securities,
(e) any provision/benefit for income taxes for such period,
(f) earnings from equity investments and unconsolidated joint
ventures determined in accordance with GAAP,
(g) losses attributable to the impairment of assets,
(h) incentive fees paid in the form of the issuance of the Seller's
common stock,
(i) Cash Interest Expense,
(j) income or expense attributable to the ineffectiveness of hedging
transactions, and
(k) interest accretions, whether in favor or against the Seller.
Without limiting the foregoing, Net Income shall be determined before
preferred stock dividends and shall include cash distributions from equity
investments and unconsolidated joint ventures.
"Affiliate" shall mean with respect to any Person, any "affiliate" of
such Person, as such term is defined in the Bankruptcy Code.
"Appraised Value" shall mean the value set forth in an appraisal made
in connection with the origination of the related Mortgage Loan as the value
of the Mortgaged Property or Underlying Mortgage Property, as applicable.
"Asset File" shall mean the documents specified on Exhibit D,
together with any additional documents and information required to be
delivered to Buyer or its designee (including the Custodian) pursuant to this
Repurchase Agreement.
"Asset Value" shall have the meaning set forth in the Pricing Side
Letter.
"Assignment and Acceptance" shall have the meaning set forth in
Section 18 hereof.
"Assignment of Leases" shall mean, with respect to any Mortgage, an
assignment of leases thereunder, notice of transfer or equivalent instrument
in recordable form, sufficient under the laws of the jurisdiction wherein the
Underlying Mortgaged Property is located to reflect the assignment of leases.
"Assignment of Mortgage" shall mean an assignment of the Mortgage,
notice of transfer or equivalent instrument in recordable form, sufficient
under the laws of the jurisdiction wherein the related Mortgaged Property is
located to reflect the sale of the Mortgage to Buyer.
"Authorized Representative" shall mean, for the purposes of this
Repurchase Agreement only, an agent or Responsible Officer of the Seller
listed on Schedule 4 hereto, as such Schedule 4 may be amended from time to
time.
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"Available Purchase Price" shall mean the excess if any of the (a)
Maximum Purchase Price less (b) the sum of the (i) Purchase Price outstanding
hereunder and (ii) the aggregate Advances (as defined in the Revolving
Facility Agreement) (converted to US Dollars at the Buyer's Spot Rate of
Exchange, as defined in the Revolving Facility Agreement) under the Revolving
Facility Agreement.
"Bailee" shall mean, with respect to each Table Funded Purchased
Asset, the related title company or other settlement agent, in each case,
approved in writing by the Buyer in its sole discretion.
"Bailee Agreement" shall mean the Bailee Agreement among the Seller,
the Buyer and the Bailee in the form of Exhibit 13 to the Custodial Agreement.
"Bailee's Trust Receipt" shall mean a Trust Receipt in the form of
Attachment 2 to the Bailee Agreement.
"Bank" shall mean ▇▇▇▇▇ Fargo Bank, N.A., in its capacity as bank
with respect to the Control Agreement.
"Bankruptcy Code" shall mean the United States Bankruptcy Code of
1978, as amended from time to time.
"Basic Mortgage Asset Document" shall mean respect to (i) any
Commercial Mortgage Loan, the original executed Mortgage Note and the original
Assignment of Mortgage, (ii) any Mezzanine Loan, the original executed
Mezzanine Loan note, the second mortgage and pledge agreement, the original
stock certificates or other evidence of the pledged interests (if applicable)
and the assignment of the foregoing, (iii) any Junior Interest, the original
executed note and (iv) any CMBS Security, the original document evidencing
such security.
"Blackrock Management Agreement" shall mean the investment advisory
agreement, dated as of the March 15, 2007, between Blackrock Financial
Management, Inc. and Seller, as amended.
"Blackrock Entities" shall mean Blackrock Financial Management, Inc.
and any of its Subsidiaries or Affiliates (other than Seller).
"Breakage Costs" has the meaning set forth in Section 4(d) hereof.
"Bridge Loan" shall mean a Commercial Mortgage Loan which is a
short-term, interim loan used to finance the cost of construction of
improvements or building(s) on property.
"Business Day" shall mean a day other than (i) a Saturday or Sunday,
(ii) any day on which banking institutions are authorized or required by law,
executive order or governmental decree to be closed in the State of New York
or (iii) any day on which the New York Stock Exchange is closed.
"Buyer" shall mean ▇▇▇▇▇▇ Commercial Paper Inc., its successors in
interest and assigns and, with respect to Section 7, its participants.
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"Capital Lease Obligations" shall mean, for any Person, all
obligations of such Person to pay rent or other amounts under a lease of (or
other agreement conveying the right to use) Property to the extent such
obligations are required to be classified and accounted for as a capital lease
on a balance sheet of such Person under GAAP, and, for purposes of this
Repurchase Agreement, the amount of such obligations shall be the capitalized
amount thereof, determined in accordance with GAAP.
"Capital Stock" shall mean any and all shares, interests,
participations or other equivalents (however designated) of capital stock of a
corporation, any and all equivalent equity ownership interests in a Person
which is not a corporation, including, without limitation, any and all member
or other equivalent interests in any limited liability company, and any and
all warrants or options to purchase any of the foregoing.
"Care Facility" shall mean a congregate care facility or assisted
living facility, nursing home, hospice, hospital or other healthcare facility.
"Cash" shall mean cash on deposit in the Collection Account or in any
other account maintained by Seller with any depository institution.
"Cash Equivalents" shall mean (a) securities with maturities of 90
days or less from the date of acquisition issued or fully guaranteed or
insured by the United States Government or any agency thereof, (b)
certificates of deposit and eurodollar time deposits with maturities of 90
days or less from the date of acquisition and overnight bank deposits of Buyer
or of any commercial bank having capital and surplus in excess of
$500,000,000, (c) repurchase obligations of Buyer or of any commercial bank
satisfying the requirements of clause (b) of this definition, having a term of
not more than seven days with respect to securities issued or fully guaranteed
or insured by the United States Government, (d) commercial paper of a domestic
issuer rated at least A-1 or the equivalent thereof by S&P or P-1 or the
equivalent thereof by ▇▇▇▇▇'▇ and in either case maturing within 90 days after
the day of acquisition, (e) securities with maturities of 90 days or less from
the date of acquisition issued or fully guaranteed by any state, commonwealth
or territory of the United States, by any political subdivision or taxing
authority of any such state, commonwealth or territory or by any foreign
government, the securities of which state, commonwealth, territory, political
subdivision, taxing authority or foreign government (as the case may be) are
rated at least A by S&P or A by ▇▇▇▇▇'▇, (f) securities with maturities of 90
days or less from the date of acquisition backed by standby letters of credit
issued by Buyer or any commercial bank satisfying the requirements of clause
(b) of this definition or (g) shares of money market mutual or similar funds
which invest exclusively in assets satisfying the requirements of clauses (a)
through (f) of this definition.
"Cash Interest Expense" shall mean for any period, total interest
expense, both expensed and capitalized, of Seller and its Subsidiaries for
such period with respect to all outstanding recourse Indebtedness of Seller
and its Subsidiaries (including, without limitation, all commissions,
discounts and other fees and charges owed with respect to letter of credit and
bankers' acceptance financing and net costs under interest rate protection
agreements), determined on a consolidated cash basis, for such period
(determined on a consolidated cash basis), and net of any interest accretions,
whether in favor or against, with respect to debt.
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"Change of Control" shall mean the occurrence of any of the following
events: (a) any "person" or "group" (within the meaning of Section 13(d) or
14(d) of the ▇▇▇▇ ▇▇▇) shall become, or obtain rights (whether by means of
warrants, options or otherwise) to become, the "beneficial owner" (as defined
in Rules 13d-3 and 13d-5 under the 1934 Act), directly or indirectly, of a
percentage of 20% or more of the total voting power of all classes of Capital
Stock of Seller entitled to vote generally in the election of directors, (b)
any event pursuant to which BlackRock Financial Management, Inc. shall cease
to act as the external manager of Seller with exclusive responsibility for
Seller's investment decision-making, or (c) the sale, transfer, or other
disposition of all or substantially all of a Seller's assets (excluding any
such action taken in connection with any securitization transaction).
"Closed Asset" shall mean an asset as to which (a) the related note
and any applicable security instrument have been delivered to the Seller and
(b) funds have been disbursed to the mortgagor, in each case, prior to the
related Purchase Date.
"Closing Data Tape" shall mean, with respect to any Transaction as of
any Purchase Date, a computer tape or other electronic medium generated by
Seller or any of its Affiliates and delivered to Buyer and Custodian, which
provides, with respect to each Purchased Asset that is the subject of such
Transaction, information responsive to the data fields acceptable to Buyer, as
well as any and all new, modified or updated information with respect to such
Purchased Asset that has been provided to Buyer prior to the applicable
Purchase Date and as to which the Purchase Price or any other information set
forth in the Purchase Confirmation for such Transaction has been based, in
each case in a format that has previously been approved by Buyer and is
otherwise acceptable to Buyer.
"CMBS Security" shall mean a Security backed by Commercial Mortgage
Loans.
"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time.
"Collection Account" shall mean the account established by the Bank
subject to an Control Agreement, into which all Income shall be deposited.
"Commercial Mortgage Loan" shall mean a Mortgage Loan (a) secured by
a first mortgage lien on an Office Building, a Retail property, a Hotel or
Motel or other commercial or multifamily property, (b) with a Loan-to-Value
Ratio of 90% or less and (c) as to which the representations and warranties in
Schedule 1(a) hereof are correct.
"Commitment Fee" shall have the meaning set forth in the Pricing Side
Letter.
"Condo Conversion" shall mean a Multifamily which is secured by a
Mortgaged Property that is in the process of being converted to and/or sold as
condominium units in a condominium project.
"Confidential Terms" shall have the meaning set forth in Section 30
hereof.
"Construction" shall mean the construction of improvements or
building(s) on property.
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"Control Agreement" shall mean a letter agreement between the Seller,
the Buyer, and the Bank substantially in the form of Exhibit B attached
hereto, as the same may be amended from time to time.
"Costs" shall have the meaning set forth in Section 15(a) hereof.
"Custodial Agreement" shall mean that certain Custodial Agreement
dated as of the date hereof, among Seller, Buyer and Custodian as the same may
be amended from time to time.
"Custodian" shall mean ▇▇▇▇▇ Fargo Bank, N.A., or any successor
thereto under the Custodial Agreement.
"Debt Service Coverage Ratio" shall mean the ratio of Adjusted Net
Income to Cash Interest Expense on recourse Indebtedness outstanding, it being
understood that such determination shall be made on a cash basis.
"Default" shall mean an Event of Default or an event that with notice
or lapse of time or both would become an Event of Default.
"Defaulting Party" shall have the meaning set forth in Section 29
hereof.
"Dollars" and "$" shall mean lawful money of the United States of
America.
"Due Date" shall mean the day of the month on which the Monthly
Payment is due on a Eligible Asset, exclusive of any days of grace.
"Due Diligence Costs" shall have the meaning set forth in Section 17
hereof.
"Due Diligence Review" shall mean the performance by Buyer of any or
all of the reviews permitted under Section 17 hereof with respect to any or
all of the Eligible Assets, as desired by the Buyer from time to time.
"Effective Date" shall mean the date upon which the conditions
precedent set forth in Section 3(a) shall have been satisfied.
"Eligible Asset" shall mean any Table Funded Purchased Asset,
Commercial Mortgage Loan, Mezzanine Loan, Junior Interest or CMBS Security
that, in each case, is acceptable to Buyer in its sole discretion, is a Closed
Asset and conforms with the applicable representations and warranties on
Schedule 1.
"Environmental Law" shall mean any federal, state, foreign or local
statute, law, rule, regulation, ordinance, code, guideline, written policy and
rule of common law now or hereafter in effect and in each case as amended, and
any judicial or administrative interpretation thereof, including any judicial
or administrative order, consent decree or judgment, relating to the
environment, employee health and safety or hazardous materials, including,
without limitation, CERCLA; RCRA; the Federal Water Pollution Control Act, 33
U.S.C. ss. 1251 et seq.; the Toxic Substances Control Act, 15 U.S.C. ss. 2601
et seq.; the Clean Air Act, 42 U.S.C. ss. 7401
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et seq.; the Safe Drinking Water Act, 42 U.S.C. ss. 3803 et seq.; the Oil
Pollution Act of 1990, 33 U.S.C. ss. 2701 et seq.; the Emergency Planning and
the Community Right-to-Know Act of 1986, 42 U.S.C. ss. 11001 et seq.; the
Hazardous Material Transportation Act, 49 U.S.C. ss. 1801 et seq. and the
Occupational Safety and Health Act, 29 U.S.C. ss. 651 et seq.; and any state
and local or foreign counterparts or equivalents, in each case as amended from
time to time.
"Equity Proceeds" shall mean any proceeds received from any sale or
issuance of Capital Stock.
"ERISA" shall, with respect to any Person, mean the Employee
Retirement Income Security Act of 1974, as amended from time to time and any
successor thereto, and the regulations promulgated and rulings issued
thereunder.
"ERISA Affiliate" shall, with respect to any Person, mean any Person
which is a member of any group of organizations (i) described in Section
414(b) or (c) of the Code of which such Person is a member, or (ii) solely for
purposes of potential liability under Section 302(c)(11) of ERISA and Section
412(c)(11) of the Code and the lien created under Section 302(f) of ERISA and
Section 412(n) of the Code, described in Section 414(m) or (o) of the Code of
which such Person is a member.
"Escrow Payments" shall mean, with respect to any Eligible Asset, the
amounts constituting ground rents, taxes, assessments, water rates, sewer
rents, municipal charges, mortgage insurance premiums, fire and hazard
insurance premiums, condominium charges, and any other payments required to be
escrowed by the Mortgagor with the mortgagee pursuant to the Mortgage or any
other document.
"Event of Default" shall have the meaning specified in Section 13
hereof.
"Event of ERISA Termination" shall, with respect to the Seller, mean
(i) with respect to any Plan, a reportable event, as defined in Section 4043
of ERISA, as to which the PBGC has not by regulation waived the reporting of
the occurrence of such event, or (ii) the withdrawal of the Seller or any
ERISA Affiliate thereof from a Plan during a plan year in which it is a
substantial employer, as defined in Section 4001(a)(2) of ERISA, or (iii) the
failure by the Seller or any ERISA Affiliate thereof to meet the minimum
funding standard of Section 412 of the Code or Section 302 of ERISA with
respect to any Plan, including, without limitation, the failure to make on or
before its due date a required installment under Section 412(m) of the Code or
Section 302(e) of ERISA, or (iv) the distribution under Section 4041 of ERISA
of a notice of intent to terminate any Plan or any action taken by the Seller
or any ERISA Affiliate thereof to terminate any Plan, or (v) the adoption of
an amendment to any Plan that, pursuant to Section 401(a)(29) of the Code or
Section 307 of ERISA, would result in the loss of tax-exempt status of the
trust of which such Plan is a part if the Seller or any ERISA Affiliate
thereof fails to timely provide security to the Plan in accordance with the
provisions of said Sections, or (vi) the institution by the PBGC of
proceedings under Section 4042 of ERISA for the termination of, or the
appointment of a trustee to administer, any Plan, or (vii) the receipt by the
Seller or any ERISA Affiliate thereof of a notice from a Multiemployer Plan
that action of the type described in the previous clause (vi) has been taken
by the PBGC with respect to such Multiemployer Plan, or (viii) any event or
circumstance exists which may reasonably be expected to constitute
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grounds for the Seller or any ERISA Affiliate thereof to incur liability under
Title IV of ERISA or under Section 412(c)(11) of the Code with respect to any
Plan.
"Excluded Taxes" shall have the meaning specified in Section 7(e)
hereof.
"Exit Fee" shall have the meaning specified in the Pricing Side
Letter.
"Expenses" shall mean all present and future expenses incurred by or
on behalf of the Buyer in connection with this Repurchase Agreement or any of
the other Facility Documents and any amendment, supplement or other
modification or waiver related hereto or thereto, whether incurred heretofore
or hereafter, which expenses shall include the cost of title, lien, judgment
and other record searches; attorneys' fees; and costs of preparing and
recording any UCC financing statements or other filings necessary to perfect
the security interest created hereby.
"Extension Fee" shall have the meaning set forth in the Pricing Side
Letter.
"Facility Documents" shall mean the Servicing Agreement, the Servicer
Notice, the Custodial Agreement, this Repurchase Agreement, and the Control
Agreement.
"▇▇▇▇▇▇ ▇▇▇" shall mean ▇▇▇▇▇▇ Mae, or any successor thereto.
"FDIA" shall have the meaning set forth in Section 31 hereof.
"FDICIA" shall have the meaning set forth in Section 31 hereof.
"Fidelity Insurance" shall mean, with respect to the Manager,
insurance coverage with respect to employee errors, omissions, dishonesty,
forgery, theft, disappearance and destruction, robbery and safe burglary,
property (other than money and securities) and computer fraud in an aggregate
amount acceptable to Manager's regulators.
"Financial Statements" shall mean the consolidated financial
statements of the Seller prepared in accordance with GAAP for the year or
other period then ended. Such financial statements will be audited, in the
case of annual statements, by Deloitte & Touche USA, LLP or such other
independent certified public accountants approved by the Buyer (which approval
shall not be unreasonably withheld).
"First Extension" shall mean the period of time from the date 60 days
after the date hereof to the date 89 days ---------------- hereafter.
"Fitch" shall mean Fitch Ratings, Inc., or any successor thereto.
"▇▇▇▇▇▇▇ Mac" shall mean ▇▇▇▇▇▇▇ Mac, or any successor thereto.
"GAAP" shall mean generally accepted accounting principles in the
United States of America, applied on a consistent basis and applied to both
classification of items and amounts, and shall include, without limitation,
the official interpretations thereof by the Financial Accounting Standards
Board, its predecessors and successors.
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"Governing Agreement" shall mean the agreement or agreements which
govern the issuance and the payment of the Securities including without
limitation a private placement memorandum or a prospectus.
"Governmental Authority" shall mean any nation or government, any
state, county, municipality or other political subdivision thereof or any
governmental body, agency, authority, department or commission (including,
without limitation, any taxing authority) or any instrumentality or officer of
any of the foregoing (including, without limitation, any court or tribunal)
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government and any corporation, partnership or
other entity directly or indirectly owned by or controlled by the foregoing.
"Ground Lease" shall mean a lease for all or any portion of the real
property comprising the Mortgaged Property, the lessee's interest in which is
held by the Mortgagor of the related Mortgage Loan.
"Ground Lessee" shall mean the ground lessee under a Ground Lease.
"Guarantee" shall mean, as to any Person, any obligation of such
Person directly or indirectly guaranteeing any Indebtedness of any other
Person or in any manner providing for the payment of any Indebtedness of any
other Person or otherwise protecting the holder of such Indebtedness against
loss (whether by virtue of partnership arrangements, by agreement to
keep-well, to purchase assets, goods, securities or services, or to
take-or-pay or otherwise); provided that the term "Guarantee" shall not
include (i) endorsements for collection or deposit in the ordinary course of
business, or (ii) obligations to make servicing advances for delinquent taxes
and insurance or other obligations in respect of a Mortgaged Property, to the
extent required by Buyer. The amount of any Guarantee of a Person shall be
deemed to be an amount equal to the stated or determinable amount of the
primary obligation in respect of which such Guarantee is made or, if not
stated or determinable, the maximum reasonably anticipated liability in
respect thereof as determined by such Person in good faith. The terms
"Guarantee" and "Guaranteed" used as verbs shall have correlative meanings.
"Hotel" or "Motel" shall mean a real estate development
owned by the Mortgagor or for which the Mortgagor is a Ground Lessee, which
constitutes a full operational hotel or motel which is part of a national or
regional chain or franchise (determined by the Buyer in its sole good faith
discretion), including all land, amenities and improvements, with individual
rooms principally for short-term rental to tenants occupying same.
"Income" shall mean, with respect to any Purchased Asset at any time,
any principal thereof then payable and all interest, dividends or other
distributions payable thereon, excluding payments received with respect to any
Mezzanine Loan which are designated for payment of senior debt and/or escrows
required thereunder.
"Indebtedness" shall mean, with respect to any Person, (a)
obligations created, issued or incurred by such Person for borrowed money
(whether by loan, the issuance and sale of debt securities or the sale of
Property to another Person subject to an understanding or agreement,
contingent or otherwise, to repurchase such Property from such Person);
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(b) obligations of such Person to pay the deferred purchase or acquisition
price of Property or services, other than trade accounts payable (other than
for borrowed money) arising, and accrued expenses incurred, in the ordinary
course of business, so long as such trade accounts payable are payable within
90 days of the date the respective goods are delivered or the respective
services are rendered; (c) Indebtedness of others secured by a Lien on the
Property of such Person, whether or not the respective Indebtedness so secured
has been assumed by such Person; (d) obligations (contingent or otherwise) of
such Person in respect of letters of credit or similar instruments issued or
accepted by banks and other financial institutions for the account of such
Person; (e) Capital Lease Obligations of such Person; (f) obligations of such
Person under repurchase agreements, sale/buy-back agreements or like
arrangements; (g) Indebtedness of others Guaranteed by such Person; (h) all
obligations of such Person incurred in connection with the acquisition or
carrying of fixed assets by such Person; and (i) Indebtedness of general
partnerships of which such Person is a general partner.
"Indemnified Party" shall have the meaning set forth in Section 15(a)
hereof.
"Industrial Property" shall mean a property owned by the Mortgagor or
for which the Mortgagor is a Ground Lessee, which constitutes a full
operational property, held partially or principally for lease to commercial
tenants in connection with manufacturing, storage or distribution.
"Initial Term" shall mean the period of time from the date hereof
until the date 59 days hereafter.
"Insolvency Event" shall mean, for any Person:
(a) that such Person or any Affiliate shall discontinue or abandon
operation of its business; or
(b) that such Person or any Affiliate shall fail generally to, or
admit in writing its inability to, pay its debts as they become due; or
(c) a proceeding shall have been instituted in a court having
jurisdiction in the premises seeking a decree or order for relief in respect
of such Person or any Affiliate in an involuntary case under any applicable
bankruptcy, insolvency, liquidation, reorganization or other similar law now
or hereafter in effect, or for the appointment of a receiver, liquidator,
assignee, trustee, custodian, sequestrator, conservator or other similar
official of such Person or any Affiliate, or for any substantial part of its
property, or for the winding-up or liquidation of its affairs; or
(d) the commencement by such Person or any Affiliate of a voluntary
case under any applicable bankruptcy, insolvency or other similar Law now or
hereafter in effect, or such Person's or any Affiliate's consent to the entry
of an order for relief in an involuntary case under any such Law, or consent
to the appointment of or taking possession by a receiver, liquidator,
assignee, trustee, custodian, sequestrator, conservator or other similar
official of such Person, or for any substantial part of its property, or any
general assignment for the benefit of creditors; or
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(e) that such Person or any Affiliate shall become insolvent; or
(f) if such Person or any Affiliate is a corporation, such Person or
any Affiliate, or any of their Subsidiaries, shall take any corporate action
in furtherance of, or the action of which would result in any of the actions
set forth in the preceding clause (a), (b), (c), (d) or (e).
"Intangible Assets Value" shall mean the excess of the cost over book
value of assets acquired, patents, trademarks, trade names, copyrights,
franchises and other intangible assets (excluding in any event the value of
any residual securities).
"Interest Rate Protection Agreement" shall mean, with respect to any
or all of the Purchased Assets, any short sale of a US Treasury Security, or
futures contract, or mortgage related security, or Eurodollar futures
contract, or options related contract, or interest rate swap, cap or collar
agreement or similar arrangement providing for protection against fluctuations
in interest rates or the exchange of nominal interest obligations, either
generally or under specific contingencies, entered into by a Seller and an
Affiliate of the Buyer, and acceptable to the Buyer.
"Junior Interest" shall mean (a) a junior "B" participation interest
or certificate in a Commercial Mortgage Loan or Mezzanine Loan or (b) a "B
note" in an A/B structure of a Commercial Mortgage Loan or Mezzanine Loan, in
each case with a Loan-to-Value Ratio of 90% or less and as to which the
representations and warranties in Schedule 1(b) hereof are correct.
"Late Payment Fee" shall mean the excess of the Price Differential
paid as a result of its calculation at the Post-Default Rate over the Price
Differential as would have been calculated at the Pricing Rate.
"LIBOR Rate" shall mean, with respect to each day a Transaction is
outstanding, the rate per annum equal to the rate appearing at page 5 of the
Telerate Screen as one-month LIBOR on such date (and if such date is not a
Business Day, the LIBOR Rate in effect on the Business Day immediately
preceding such date), and if such rate shall not be so quoted, the rate per
annum at which the Buyer or its Affiliate is offered dollar deposits at or
about 10:00 a.m., New York City time, on such date, by prime banks in the
interbank eurodollar market where the eurodollar and foreign currency exchange
operations in respect of its Transactions are then being conducted for
delivery on such day for a period of one month and in an amount comparable to
the amount of the Transactions outstanding on such day.
"Lien" shall mean any lien, claim, charge, restriction, pledge,
security interest, mortgage, deed of trust or other encumbrance.
"Loan Security Agreement" shall mean as to any Purchased Asset, any
contract, instrument or other document related to security for repayment
thereof (other than in the case of a Mortgage Loan, the related Mortgage and
Mortgage Note), executed by the obligor and/or others in connection with such
Mortgage Loan, including without limitation, any security agreement, guaranty,
title insurance policy, hazard insurance policy, chattel mortgage, letter of
credit or certificate of deposit or other pledged accounts, and any other
documents and records relating to any of the foregoing.
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"Loan-to-Value Ratio" or "LTV" shall mean with respect to any
Eligible Asset, the ratio of the original outstanding principal amount of the
Eligible Asset to the lesser of (a) the Appraised Value of the Mortgaged
Property or Underlying Mortgage Property at origination or (b) if the
Mortgaged Property or Underlying Mortgaged Property was purchased within 12
months of the origination of the Mortgage Loan, the purchase price of the
Mortgaged Property or Underlying Mortgage Property.
"Manager" shall mean Blackrock Financial Management, Inc.
"Margin Call" shall have the meaning specified in Section 4.
"Margin Deficit" shall have the meaning specified in Section 4.
"Market Value" shall mean, as of any date with respect to any
Purchased Asset, the price at which such Eligible Asset could readily be sold
as determined by the Buyer in its good faith discretion.
"Material Adverse Effect" shall mean a material adverse effect on (a)
any of the property, business, operations or financial condition of Seller and
its consolidated Subsidiaries, taken as a whole, (b) the ability of Seller to
perform its obligations under any of the Facility Documents to which it is a
party, (c) the validity or enforceability of any of the Facility Documents or
(d) the rights and remedies of the Buyer under any of the Facility Documents.
"Maximum Purchase Price" shall have the meaning set forth in the
Pricing Side Letter.
"Mezzanine Borrower" has the meaning set forth in paragraph 13 of
Schedule 1(c).
"Mezzanine Collateral" shall mean the collateral pledged in respect
of a Mezzanine Loan.
"Mezzanine Loan" shall mean a loan (a)(i) secured by a second
mortgage lien on commercial real property to an entity that directly owns such
commercial real property or (ii) to an entity owning an interest in a special
purpose entity that directly owns commercial real property and such loan is
secured by a pledge of excess cash flow after first mortgage debt service or
equity interests in the owner of such commercial real property (b) with a
Loan-to-Value Ratio of 90% or less and (c) as to which the representations and
warranties in Schedule 1(c) hereof are correct.
"Mezzanine Loan Documents" shall mean the documentation governing a
Mezzanine Loan.
"Monthly Payment" shall mean the scheduled monthly payment of
principal and interest on a Eligible Asset.
"▇▇▇▇▇'▇" shall mean ▇▇▇▇▇'▇ Investor's Service, Inc. or any
successors thereto.
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"Mortgage" shall mean each mortgage, assignment of rents, security
agreement and fixture filing, or deed of trust, assignment of rents, security
agreement and fixture filing, deed to secure debt, assignment of rents,
security agreement and fixture filing, or similar instrument creating and
evidencing a first or second lien on real property and other property and
rights incidental thereto.
"Mortgage Interest Rate" shall mean the rate of interest borne on a
Mortgage Loan from time to time in accordance with the terms of the related
Mortgage Note.
"Mortgage Loan" shall mean a Commercial Mortgage Loan or a Junior
Interest in a Commercial Mortgage Loan.
"Mortgage Note" shall mean the promissory note or other evidence of
the indebtedness of a Mortgagor secured by a Mortgage.
"Mortgaged Property" shall mean the real property securing repayment
of the debt evidenced by a Mortgage Note.
"Mortgagor" shall mean the obligor or obligors on a Mortgage Note,
including any Person who has assumed or guaranteed the obligations of the
obligor thereunder.
"Multiemployer Plan" shall mean, with respect to any Person, a
"multiemployer plan" as defined in Section 4001(a)(3) of ERISA which is or was
at any time during the current year or the immediately preceding five years
contributed to (or required to be contributed to )by such Person or any ERISA
Affiliate thereof on behalf of its employees and which is covered by Title IV
of ERISA.
"Multifamily" shall mean a Commercial Mortgage Loan secured by a
first mortgage lien on a five-or-more family residential property, as to which
the representations and warranties in Schedule 1(a) hereof are correct.
"Net Income" shall mean for any period and for Seller and its
consolidated Subsidiaries, the consolidated net income (or loss) of Seller and
its consolidated Subsidiaries for such period as determined on a consolidated
basis in accordance with GAAP.
"Non-Excluded Taxes" shall have the meaning set forth in Section 7(a)
hereof.
"Non-Exempt Buyer" shall have the meaning set forth in Section 7(e)
hereof.
"Nondefaulting Party" shall have the meaning set forth in Section 29
hereof.
"Non-Recourse Indebtedness" shall mean, with respect to any Person,
Indebtedness for borrowed money in respect of which recourse for payment
(except for customary exceptions for fraud, misapplication of funds,
environmental indemnities, and other customary exceptions to non-recourse
provisions) is contractually limited to specific assets of such Person
encumbered by a Lien securing such Indebtedness.
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"Non-Performing Asset" shall mean (i) any Eligible Asset for which
any payment of principal or interest is (or has been in the preceding 12
months) more than twenty-nine (29) days past due or the actual net cash flow
from the underlying property is insufficient to pay debt service, (ii) any
Eligible Asset with respect to which the related obligor is in bankruptcy or
(iii) any Eligible Asset (other than Securities) with respect to which the
related Mortgaged Property is in foreclosure.
"Obligations" shall mean (a) any amounts owed by the Seller to Buyer
in connection with a Transaction hereunder, together with interest thereon
(including interest which would be payable as post-petition interest in
connection with any bankruptcy or similar proceeding) and all other fees or
expenses which are payable hereunder or under any of the Facility Documents;
(b) all other obligations or amounts owed to Buyer under the Guaranty and (c)
all other obligations or amounts owed by the Seller to the Buyer or an
Affiliate of Buyer under any other contract or agreement, in each case,
whether such amounts or obligations owed are direct or indirect, absolute or
contingent, matured or unmatured.
"OFAC" shall have the meaning set forth in Section 11(y) hereof.
"Office Building" shall mean a building owned by the Mortgagor or for
which the Mortgagor is a Ground Lessee, which constitutes a full operational
office building, including all land, amenities and improvements, with
individual office space held principally for lease to commercial tenants and
not principally for lease to recreational or residential tenants.
"Organic Document" shall mean, relative to Seller, its certificate of
incorporation, by-laws, certificate of partnership, partnership agreement,
certificate of formation, limited liability agreement and all shareholder
agreements, voting trusts and similar arrangements to which such party is a
party applicable to any of its authorized shares of Capital Stock.
"Other Taxes" shall have the meaning set forth in Section 7(b)
hereof.
"Payment Date" shall mean the first day of each month, or if such
date is not a Business Day, the Business Day immediately preceding the last
day of the month.
"PBGC" shall mean the Pension Benefit Guaranty Corporation or any
entity succeeding to any or all of its functions under ERISA.
"Periodic Advance Repurchase Payment" shall have the meaning
specified in Section 5(a).
"Person" shall mean any individual, corporation, company, voluntary
association, partnership, joint venture, limited liability company, trust,
unincorporated association or government (or any agency, instrumentality or
political subdivision thereof).
"Physical Security" shall mean a Security issued in definitive form
that are not registered on a Relevant System.
"PML" shall have the meaning set forth in paragraph 22 of Schedule
1(a).
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"Plan" shall mean, with respect to the Seller, any employee benefit
or similar plan that is or was at any time during the current year or
immediately preceding five years established, maintained or contributed to by
the Seller or any ERISA Affiliate thereof and that is covered by Title IV of
ERISA, other than a Multiemployer Plan.
"Post-Default Rate" shall have the meaning set forth in the Pricing
Side Letter.
"Preliminary Data Tape" shall mean a preliminary version of the
Closing Data Tape, which shall be attached to the Transaction Request.
"Price Differential" shall mean, with respect to any Transaction
hereunder as of any date, the aggregate amount obtained by daily application
of the Pricing Rate (or, during the continuation of an Event of Default, by
daily application of the Post-Default Rate) for such Transaction to the
Purchase Price for such Transaction on a 360 day per year basis for the actual
number of days during the period commencing on (and including) the Purchase
Date for such Transaction and ending on (but excluding) the Repurchase Date
(reduced by any amount of such Price Differential previously paid by Seller to
Buyer with respect to such Transaction).
"Pricing Side Letter" shall mean that certain letter agreement among
the Buyer and the Seller, dated as of the date hereof, as the same may be
amended from time to time.
"Pricing Rate" shall mean a rate per annum equal to the sum of (a)
the LIBOR Rate plus (b) the Pricing Spread.
"Pricing Spread" shall have the meaning set forth in the Pricing Side
Letter.
"Prohibited Person" shall have the meaning set forth in Section 11(y)
hereof.
"Property" shall mean any right or interest in or to property of any
kind whatsoever, whether real, personal or mixed and whether tangible or
intangible.
"Purchase Date" shall mean the date on which Purchased Assets are
transferred by Seller to the Buyer or its designee.
"Purchase Price" shall have the meaning set forth in the Pricing Side
Letter.
"Purchase Price Percentage" shall have the meaning set forth in the
Pricing Side Letter.
"Purchased Assets" shall mean the collective reference to Eligible
Assets, together with the Repurchase Assets related to such Eligible Assets
transferred by Seller to Buyer in a Transaction hereunder, listed on the
related Closing Data Tape attached to the related Transaction Request.
"Purchased Asset Schedule" shall mean with respect to any Transaction
as of any date, a schedule in the form of Exhibit C attached hereto. The
Purchased Asset Schedule shall be attached to each Trust Receipt.
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"Qualified Insurer" shall mean a mortgage guaranty insurance company
duly authorized and licensed where required by law to transact mortgage
guaranty insurance business and acceptable under the Underwriting Guidelines.
"Rated" shall mean the rating of an Eligible Asset by a Rating
Agency.
"Rating Agency" shall mean any of S&P, ▇▇▇▇▇'▇ or ▇▇▇▇▇.
"Records" shall mean all instruments, agreements and other books,
records, and reports and data generated by other media for the storage of
information maintained by Seller, Servicer or any other person or entity with
respect to a Purchased Asset. Records shall include the Mortgage Notes, any
Mortgages, the Asset Files, the credit files related to the Purchased Asset
and any other instruments necessary to document or service a Mortgage Loan.
"Register" shall have the meaning set forth in Section 19 hereof.
"Regulations T, U and X" shall mean Regulations T, U and X of the
Board of Governors of the Federal Reserve System (or any successor), as the
same may be modified and supplemented and in effect from time to time.
"REIT" shall mean a real estate investment trust, as defined in
Section 856 of the Code.
"Relevant System" shall mean (a) The Depository Trust Corporation in
New York, New York, or (b) such other applicable clearing organization or
book-entry system located in the United States, in either case based upon the
system pursuant to which the related Purchased Assets may be held in
book-entry form.
"REMIC" shall mean a real estate mortgage investment conduit, within
the meaning of Section 860D(a) of the Code.
"REMIC Provisions" shall mean provisions of the federal income tax
law relating to real estate mortgage investment conduits, which appear at
Sections 860A through 860G of subchapter M of Chapter 1 of the Code, and
related provisions, and regulations (including any applicable proposed
regulations) and rulings promulgated thereunder, as the foregoing may be in
effect from time to time.
"Reportable Event" shall mean any of the events set forth in Section
4043(c) of ERISA, other than those events as to which the thirty day notice
period is waived under subsections .21, .22, .24, .26, .27 or .28 of PBGC Reg.
ss. 4043.
"Repurchase Agreement" shall mean this Master Repurchase Agreement
between Buyer and the Seller, dated as of the date hereof as the same may be
further amended, supplemented or otherwise modified in accordance with the
terms hereof.
"Repurchase Assets" shall have the meaning provided in Section 8
hereof.
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"Repurchase Date" shall mean the date on which the Seller is to
repurchase the Purchased Assets subject to a Transaction from Buyer as
specified in the related Purchase Confirmation, or if not so specified on a
date requested pursuant to Section 3(d) or on the Termination Date, including
any date determined by application of the provisions of Sections 3 or 14.
"Repurchase Price" shall mean the price at which Purchased Assets are
to be transferred from Buyer or its designee to the Seller upon termination of
a Transaction, which will be determined in each case (including Transactions
terminable upon demand) as the sum of the Purchase Price and the Price
Differential as of the date of such determination.
"Requirement of Law" shall mean as to any Person, the certificate of
incorporation and by-laws or other organizational or governing documents of
such Person, and any law, treaty, rule, regulation, procedure or determination
of an arbitrator or a court or other Governmental Authority, in each case
applicable to or binding upon such Person or any of its property or to which
such Person or any of its property is subject.
"Responsible Officer" shall mean an officer of the Seller listed on
Schedule 5 hereto, as such Schedule 5 may be amended from time to time.
"Retail" shall mean a property owned by the Mortgagor or for which
the Mortgagor is a Ground Lessee, which constitutes a full operational retail
store, held principally for lease to a commercial retail tenant within a
shopping center or mall and not principally for lease to recreational or
residential tenants.
"Revolving Facility Agreement" shall mean that certain Revolving
Facility Agreement, among AHR Capital Limited, Anthracite Capital Inc. and
▇▇▇▇▇▇ Commercial Paper Inc., UK Branch, dated as of April 19, 2007, as
amended from time to time.
"S&P" shall mean Standard & Poor's Ratings Services, or any successor
thereto.
"SEC" shall have the meaning set forth in Section 32 hereof.
"Second Extension" shall mean the period of time from the date 90
days after the date hereof to the date 120 days hereafter.
"Section 4402" shall have the meaning set forth in Section 29 hereof.
"Section 7 Certificate" shall have the meaning set forth in Section
7(e) hereof.
"Security" shall mean CMBS Security and as to which the
representations and warranties in Schedule 1(e) hereof are correct.
"Seller" shall mean Anthracite Capital, Inc., or any successor in
interest thereto.
"Servicer" shall mean Midland Loan Services, Inc. or any successor or
permitted assigns.
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"Servicer Notice" shall mean the notice acknowledged by the Servicer
substantially in the form of Exhibit G hereto.
"Servicing Agreement" shall mean any servicing agreement entered into
among a Seller and a Servicer, as the same may be amended from time to time.
"Servicing Report" shall mean a report remitted by the Servicer
monthly, substantially in the form of Exhibit M hereto.
"Single-Employer Plan" shall mean a single-employer plan as defined
in Section 4001(a)(15) of ERISA which is subject to the provisions of Title IV
of ERISA.
"SIPA" shall have the meaning set forth in Section 32 hereof.
"Subordinated Debt" shall mean Indebtedness of Seller which is (i)
unsecured, (ii) no part of the principal of such Indebtedness is required to
be paid (whether by way of mandatory sinking fund, mandatory redemption,
mandatory prepayment or otherwise) prior to the date which is one year
following the Termination Date and (iii) the payment of the principal of and
interest on such Indebtedness and other obligations of Seller in respect of
such Indebtedness are subordinated to the prior payment in full of the
principal of and interest (including post-petition obligations) on the
Transactions and all other obligations and liabilities of Seller to Buyer
hereunder on terms and conditions approved in writing by Buyer and all other
terms and conditions of which are satisfactory in form and substance to Buyer.
"Subsidiary" shall mean, with respect to any Person, any corporation,
partnership or other entity (other than an entity established solely to issue
collateralized debt obligations) of which at least a majority of the
securities or other ownership interests having by the terms thereof ordinary
voting power to elect a majority of the board of directors or other persons
performing similar functions of such corporation, partnership or other entity
(irrespective of whether or not at the time securities or other ownership
interests of any other class or classes of such corporation, partnership or
other entity shall have or might have voting power by reason of the happening
of any contingency) is at the time directly or indirectly owned or controlled
by such Person or one or more Subsidiaries of such Person or by such Person
and one or more Subsidiaries of such Person.
"Table Funded Purchased Asset" shall mean a Purchased Asset which is
sold to the Buyer (and held by a Bailee pursuant to a Bailee Agreement)
simultaneously with the origination or acquisition thereof, which origination
or acquisition, pursuant to the Seller's request, is financed with the
Purchase Price and paid directly to a title company or other settlement agent,
in each case, approved in writing by the Buyer in its sole discretion, for
disbursement to the parties entitled thereto in connection with such
origination or acquisition. A Purchased Asset shall cease to be a Table Funded
Purchased Asset after the Custodian has delivered a Trust Receipt to the Buyer
certifying its receipt of the Asset File therefor.
"Table Funded Trust Receipt" shall mean a Trust Receipt in the form
of Exhibit 12 to the Custodial Agreement.
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"Tangible Net Worth" shall mean, as of a particular date, (i) all
amounts that would be included under stockholder's equity on a balance sheet
of Seller and its consolidated Subsidiaries at such date, determined in
accordance with GAAP, less (ii) the sum of (A) amounts owing to Seller and its
consolidated Subsidiaries from Affiliates and (B) Intangible Assets Value of
Seller and its consolidated Subsidiaries.
"Taxes" shall have the meaning set forth in Section 7(a) hereof.
"Termination Date" shall have the meaning set forth in the Pricing
Side Letter.
"Test Period" shall mean any period of three (3) consecutive months.
"Third Party Servicer" shall mean any servicer of the Purchased
Assets or a portion thereof, other than the Servicer who is the primary
servicer and administrator of the Purchased Assets.
"Transaction" shall have the meaning specified in Section 1.
"Transaction Request" shall mean a request from the Seller to Buyer
to enter into a Transaction, in the form attached as Exhibit L.
"Trust Receipt" shall have the meaning set forth in the Custodial
Agreement.
"Total Indebtedness" shall mean for any period, the aggregate
Indebtedness (excepting any Non-Recourse Indebtedness) of Seller and its
consolidated Subsidiaries during such period.
"Underlying Mortgage Loan" shall mean, with respect to any Junior
Interest, Mezzanine Loan or CMBS Security, a mortgage loan made in respect of
the related Underlying Mortgaged Property.
"Underlying Mortgaged Property" shall mean in the case of any:
(a) Commercial Mortgage Loan, the Mortgaged Property securing such
Commercial Mortgage Loan;
(b) Junior Interest, the Mortgaged Property securing the Mortgage
Loan in which such Junior Interest represents a junior participation (if the
Junior Interest is of the type described in clause (a) of the definition
thereof) or the Mortgaged Property securing such Junior Interest (if the
Junior Interest is of the type described in clause (b) of the definition
thereof);
(c) Mezzanine Loan, the Mortgaged Property that is owned by the
Person the Capital Stock of which is pledged as collateral security for such
Mezzanine Loan; and
(d) CMBS Security, the Mortgaged Property securing the Underlying
Mortgage Loans related to such security.
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"Unfunded Margin Amount" shall mean unfunded eligible collateral
under a committed warehouse facility whereby funds may be drawn within one (1)
Business Day of request thereof and pursuant to which no event or circumstance
shall have occurred thereunder which would, by terms of the applicable
agreement, prohibit the Seller from borrowing or drawing money thereunder.
"Underwriting Guidelines" shall mean the underwriting guidelines of
the Seller, attached hereto as Exhibit E, and as the same may be modified from
time to time in accordance with Section 12(ee).
"Uniform Commercial Code" shall mean the Uniform Commercial
Code as in effect from time to time in the State of New York; provided that if
by reason of mandatory provisions of law, the perfection or the effect of
perfection or non perfection of the security interest in any Repurchase Assets
or the continuation, renewal or enforcement thereof is governed by the Uniform
Commercial Code as in effect in a jurisdiction other than New York, "Uniform
Commercial Code" shall mean the Uniform Commercial Code as in effect in such
other jurisdiction for purposes of the provisions hereof relating to such
perfection or effect of perfection or non perfection.
SECTION 3. INITIATION; TERMINATION
(a) Conditions Precedent to Initial Transaction. Buyer's agreement to
enter into the initial Transaction hereunder is subject to the satisfaction,
immediately prior to or concurrently with the making of such Transaction, of
the condition precedent that Buyer shall have received from the Seller any
fees and expenses payable hereunder, and all of the following documents, each
of which shall be satisfactory to Buyer and its counsel in form and substance:
(i) The following Facility Documents delivered to the Buyer:
(A) Repurchase Agreement. This Repurchase
Agreement, duly executed by the parties thereto;
(B) Custodial Agreement. The Custodial Agreement,
duly executed by the parties thereto;
(C) Control Agreement. A Control Agreement, duly
executed by the parties thereto in form and substance
acceptable to the Buyer;
(D) Reserved;
(E) Pricing Side Letter. The Pricing Side Letter,
duly executed by the parties thereto in form and substance
acceptable to the Buyer;
(F) Servicing Agreement. A Servicing Agreement,
duly executed by the parties thereto;
(G) Reserved; and
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(H) Servicer Notice. The Servicer Notice duly
executed by the parties thereto.
(ii) Opinions of Counsel.
(A) An opinion or opinions of outside counsel to
the Seller, substantially in the form of Exhibit A.
(iii) Organizational Documents. A certificate of corporate
existence of the Seller delivered to Buyer prior to the Effective
Date (or if unavailable, as soon as available thereafter) and
certified copies of the charter and by-laws (or equivalent documents)
of the Seller and of all corporate or other authority for the Seller
with respect to the execution, delivery and performance of the
Facility Documents and each other document to be delivered by the
Seller from time to time in connection herewith, and good standing
certificates with respect to such party.
(iv) Incumbency Certificate. An incumbency certificate of
the corporate secretary of Seller, certifying the names, true
signatures and titles of the representatives duly authorized to
request transactions hereunder and to execute the Facility Documents.
(v) Security Interest. Evidence that all other actions
necessary or, in the opinion of Buyer, desirable to perfect and
protect Buyer's interest in the Purchased Assets and other Repurchase
Assets have been taken, including, without limitation, UCC searches
and duly authorized and filed Uniform Commercial Code financing
statements on Form UCC-1.
(vi) Reserved.
(vii) Reserved.
(viii) Fees. Payment of any fees due to Buyer hereunder,
including the Commitment Fee.
(ix) Other Documents. Such other documents as Buyer may
reasonably request, in form and substance reasonably acceptable to
Buyer.
(b) Conditions Precedent to all Transactions. Upon satisfaction of
the conditions set forth in this Section 3(b), the Buyer shall enter into a
Transaction with Seller. Buyer's obligation to enter into each Transaction
(including the initial Transaction) is subject to the satisfaction of the
following further conditions precedent, both immediately prior to entering
into such Transaction and also after giving effect thereto to the intended use
thereof:
(i) Due Diligence Review. Without limiting the generality of
Section 17 hereof, Buyer shall have completed, to its satisfaction,
its due diligence review of the related Eligible Assets and Seller
and the Servicer.
(ii) Securities. With respect to Securities proposed to be
purchased:
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(A) that shall be delivered or held in definitive,
certificated form, the Seller shall deliver to the Buyer or
its designee the original of the relevant certificate
registered in the name of the Buyer or its designee;
(B) that shall be delivered through a Relevant
System in book-entry form and credited to or otherwise held
in an account, such Security shall be registered in the name
of the Buyer or its designee and the Seller shall take such
actions necessary to provide instruction to the relevant
financial institution or other entity, which instruction
shall be sufficient if complied with to effect a legally
valid delivery of the relevant interest granted therein to
Buyer hereunder. In connection with any account to which the
Securities are credited or otherwise held, the Seller shall
execute and deliver such other and further documents or
instruments necessary, in the reasonable opinion of the
Buyer, to effect a legally valid delivery of the relevant
interest granted therein to Buyer hereunder. Any account to
which the Securities are credited shall be designed as the
Buyer may direct.
(iii) No Default. No Default or Event of Default shall have
occurred and be continuing under the Facility Documents.
(iv) Representations and Warranties. Both immediately prior
to the Transaction and also after giving effect thereto and to the
intended use thereof, the representations and warranties made by the
Seller in Section 11 hereof, shall be true, correct and complete on
and as of such Purchase Date in all material respects with the same
force and effect as if made on and as of such date (or, if any such
representation or warranty is expressly stated to have been made as
of a specific date, as of such specific date).
(v) Available Purchase Price. The Purchase Price for all
Purchased Assets subject to the Transaction under this Repurchase
Agreement shall not exceed the Available Purchase Price.
(vi) No Margin Deficit. After giving effect to the requested
Transaction, the Asset Value of all Purchased Assets exceeds the
aggregate Repurchase Price for such Transactions.
(vii) Transaction Request. On or prior to 11:00 a.m. (New
York Time) five (5) days prior to the related Purchase Date, the
Seller shall have delivered to (x) the Buyer, a Transaction Request
and (y) to Buyer and Custodian, (a) a Purchased Asset Schedule and
(b) the Closing Data Tape.
(viii) Delivery of Asset File.
(A) The Seller shall have delivered to the
Custodian the Asset File with respect to each Purchased
Asset and the Custodian shall have issued a Trust Receipt or
a Table Funded Trust Receipt, as applicable, with respect to
each such Purchased Asset to the Buyer.
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(B) With respect to each Table Funded Purchased
Asset, the Seller shall cause the Bailee to deliver to the
Custodian with a copy to the Buyer no later than 11:00 a.m.
on the Purchase Date by facsimile or by other electronic
means acceptable to the parties the related Basic Mortgage
Asset Documents, the insured closing letter (if any), the
escrow instructions (if any), a fully executed Bailee
Agreement, a Bailee's Trust Receipt issued by the Bailee
thereunder and such other evidence satisfactory to the Buyer
in its discretion that all documents necessary to effect a
transfer of the Table Funded Purchased Assets to the Buyer
have been delivered to Bailee. With respect to each Table
Funded Purchased Asset, the Custodian shall deliver to the
Buyer a Table Funded Trust Receipt no later than 1:00 p.m.
on the Purchase Date, which documents shall be acceptable to
the Buyer in its sole discretion. In the case of a Table
Funded Purchased Asset, Seller shall deliver or cause to be
delivered and released to the Custodian the documents set
forth in the Asset File pertaining to the Table Funded
Purchased Assets within three (3) Business Days following
the applicable Purchase Date, and on the second (2nd)
Business Day following the Custodian's receipt of the Asset
File, the Custodian shall deliver to the Buyer a Trust
Receipt certifying its receipt of the documents required to
be delivered pursuant to the Custodial Agreement, together
with a Purchased Asset Schedule and inventory list relating
to the Basic Mortgage Asset Documents, with any exceptions
identified on the inventory list by the Custodian as of the
date and time of delivery of such Purchased Asset Schedule.
(ix) Fees and Expenses. The Buyer shall have received all
fees and expenses of counsel to the Buyer as contemplated by Sections
10 and 15(b) which amounts, at the Buyer's option, may be withheld
from the proceeds remitted by Buyer to the Seller pursuant to any
Transaction hereunder.
(x) No Material Adverse Change. None of the following shall
have occurred and/or be continuing:
(A) an event or events shall have occurred in the
good faith determination of the Buyer resulting in the
effective absence of a "repo market" or comparable "lending
market" for financing debt obligations secured by securities
or an event or events shall have occurred resulting in the
Buyer not being able to finance Purchased Assets through the
"repo market" or "lending market" with traditional
counterparties at rates which would have been reasonable
prior to the occurrence of such event or events; or
(B) an event or events shall have occurred
resulting in the effective absence of a "securities market"
for securities backed by mortgage loans or an event or
events shall have occurred resulting in Buyer not being able
to sell securities backed by mortgage loans at prices which
would have been reasonable prior to such event or events; or
(C) Reserved;
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(D) there shall have occurred (i) an outbreak or
escalation of hostilities or a material change in national
or international political, financial or economic
conditions; (ii) a general suspension of trading on major
stock exchanges; or (iii) a disruption in or moratorium on
commercial banking activities or securities settlement
services.
(xi) Minimum Transaction Size and Timing. The minimum
Purchase Price with respect to such Transaction is at least $1
million. No more than three Transactions shall have been entered into
in any calendar week.
(xii) Requirements of Law. Buyer shall not have determined
that the introduction of or a change in any Requirement of Law or in
the interpretation or administration of any Requirement of Law
applicable to Buyer has made it unlawful, and no Governmental
Authority shall have asserted that it is unlawful, for Buyer to enter
into Transactions with a Pricing Rate based on LIBOR.
Each Transaction Request delivered by the Seller hereunder shall
constitute a certification by the Seller that all the conditions set forth in
this Section 3(b) (other than clauses (ix) and (x) hereof) have been satisfied
(both as of the date of such notice or request and as of Purchase Date).
(c) Initiation.
(i) The Seller shall deliver a Transaction Request to the
Buyer on or prior to the date and time set forth in Section 3(b)(vii)
prior to entering into any Transaction. Such Transaction Request
shall include a Purchased Asset Schedule with respect to the Eligible
Assets to be sold in such requested Transaction. During the extension
periods specified in Section 3(e) hereof, the parties hereto shall
not enter into any new Transactions.
(ii) Following receipt of a Transaction Request and a
Purchased Asset Schedule, Buyer shall, as hereinafter provided,
inform Seller of its election to purchase any Eligible Assets
proposed to be sold to Buyer by Seller hereunder. Buyer shall have
the right to review all Eligible Assets proposed to be sold to Buyer
and conduct its own due diligence investigation of such Eligible
Assets as Buyer determines. Upon completion of its review, Buyer
shall in its sole discretion determine whether to purchase such
Eligible Assets.
(iii) The Repurchase Date for each Transaction shall not be
later than the Termination Date.
(iv) Subject to the terms and conditions of this Repurchase
Agreement, during such period the Seller may sell, repurchase and
resell Eligible Assets hereunder.
(v) No later than the date and time set forth in Section
3(b)(viii), the Seller shall deliver to the Custodian the Asset File
pertaining to each Eligible Asset to be purchased by the Buyer.
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(vi) Subject to the provisions of this Section 3, the
Purchase Price will then be made available to the Seller by the Buyer
transferring, via wire transfer, in the aggregate amount of such
Purchase Price in funds immediately available.
(d) Repurchase
(i) The Seller may repurchase Purchased Assets without
penalty or premium on any date. The Repurchase Price payable for the
repurchase of any such Purchased Asset shall be reduced as provided
in Section 5(f). If the Seller intends to make such a repurchase, the
Seller shall give one (1) Business Day's prior written notice thereof
to the Buyer, designating the Purchased Assets to be repurchased. If
such notice is given, the amount specified in such notice shall be
due and payable on the date specified therein, and, on receipt, such
amount shall be applied to the Repurchase Price for the designated
Purchased Assets.
(ii) On the Repurchase Date, termination of the Transaction
will be effected by reassignment to the Seller or its designee of the
Purchased Assets (and any Income in respect thereof received by Buyer
not previously credited or transferred to, or applied to the
obligations of, the Seller pursuant to Section 5) against the
simultaneous transfer of the Repurchase Price to an account of Buyer.
Such obligation to repurchase exists without regard to any prior or
intervening liquidation or foreclosure with respect to any Purchased
Asset (but liquidation or foreclosure proceeds received by Buyer
shall be applied to reduce the Repurchase Price for such Purchased
Asset on each Payment Date except as otherwise provided herein). The
Seller is obligated to obtain the Asset Files from Buyer or its
designee at the Seller's expense on the Repurchase Date.
(iii) If the Seller repurchases, in whole or in part,
Purchased Assets, the
Seller shall indemnify the Buyer and hold the Buyer harmless from any
losses, costs and/or expenses which the Buyer sustains or incurs
arising from the reemployment of funds obtained by the Buyer
hereunder or from fees payable to terminate the deposits from which
such funds were obtained ("Breakage Costs"). The Buyer shall deliver
to the Seller a statement setting forth the amount and basis of
determination of any Breakage Costs in such detail as determined in
good faith by the Buyer to be adequate, it being agreed that such
statement and the method of its calculation shall be adequate and
shall be conclusive and binding upon the Seller, absent manifest
error.
(e) Extension of Termination Date. At the request of the Seller made
ten (10) days or more prior to the Termination Date of this Repurchase
Agreement, the Buyer may in its sole discretion extend the Termination Date for
a period of 30 additional days by giving written notice of such extension to the
Seller no later than seven (7) days after the Buyer's receipt of the Seller's
request. Any failure by the Buyer to deliver such notice of extension shall be
deemed to be the Buyer's determination not to extend the then current
Termination Date. Seller may request only two 30-day extensions to the
Termination Date. With respect to any requested Second Extension, Seller shall
pay to Buyer the Extension Fee prior to the effective date of such Second
Extension.
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SECTION 4. MARGIN AMOUNT MAINTENANCE
(a) The Buyer shall determine the Asset Value of the Purchased Assets
at such intervals as determined by the Buyer in its sole discretion.
(b) If at any time the aggregate Asset Value of all related Purchased
Assets subject to all Transactions is less than the aggregate Purchase Price
for all such Transactions (a "Margin Deficit"), then Buyer may by notice to
Seller (as such notice is more particularly set forth below, a "Margin Call"),
require Seller to transfer to Buyer or its designee cash or Eligible Assets
approved by the Buyer in its sole discretion ("Additional Purchased Assets")
so that the aggregate Asset Value of the Purchased Assets, including any such
cash or Additional Purchased Assets, will thereupon equal or exceed the
aggregate Purchase Price for all Transactions. If Buyer delivers a Margin Call
to the Seller on or prior to 9:30 a.m. (New York City time) on any Business
Day, then the Seller shall transfer cash or Additional Purchased Assets to
Buyer no later than 9:30 a.m. (New York City time) on the subsequent Business
Day. In the event the Buyer delivers a Margin Call to a Seller after 9:30 a.m.
(New York City time) on any Business Day, the Seller shall be required to
transfer cash or Additional Purchased Assets no later than 5 p.m. (New York
City time) on the subsequent Business Day.
(c) Buyer's election, in its sole and absolute discretion, not to
make a Margin Call at any time there is a Margin Deficit shall not in any way
limit or impair its right to make a Margin Call at any time a Margin Deficit
exists.
(d) Any cash transferred to the Buyer pursuant to Section 4(b) above
shall be credited to the Repurchase Price of the related Transactions.
SECTION 5. INCOME PAYMENTS
(a) Notwithstanding that Buyer and the Seller intend that the
Transactions hereunder be sales to Buyer of the Purchased Assets for all
purposes except accounting and tax purposes, Seller shall pay to Buyer the
accreted value of the Price Differential (less any amount of such Price
Differential previously paid by the Seller to Buyer) plus the amount of any
unpaid Margin Deficit (each such payment, a "Periodic Advance Repurchase
Payment") on each Payment Date. Notwithstanding the preceding sentence, if
Seller fails to make all or part of the Periodic Advance Repurchase Payment by
3:00 p.m. (New York time) on any Payment Date, the Pricing Rate shall be equal
to the Post-Default Rate until the Periodic Advance Repurchase Payment is
received in full by Buyer.
(b) The Seller shall hold for the benefit of, and in trust for, Buyer
all income, including without limitation all Income received by or on behalf
of the Seller with respect to such Purchased Assets. The Seller or Servicer
shall deposit such Income in a deposit account (the title of which shall
indicate that the funds therein are being held in trust for Buyer) (the
"Collection Account") with a financial institution acceptable to Buyer and
subject to the Control Agreement. All such Income shall be held in trust for
Buyer, shall constitute the property of Buyer, except for tax purposes which
shall be treated as income and property of the Seller, and shall not be
commingled with other property of the Seller, any Affiliate of the Seller or
the applicable Seller except as expressly permitted above. Funds deposited in
the Collection
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Account during any month shall be held therein, in trust for the Buyer, until
the next Payment Date. On or before 12:00 p.m. (New York time) on the date two
Business Days prior to the Payment Date, the Seller shall deliver to the Buyer
and the Bank a distribution worksheet. Subject to the terms of the Control
Agreement and in accordance with the Buyer authorization, the Bank, the Seller
shall withdraw any funds on deposit in the Collection Account and apply such
funds as follows:
(i) first, to the payment of all costs and fees payable by
the Seller pursuant to this Repurchase Agreement;
(ii) second, to the Buyer in payment of any accrued and
unpaid Price Differential;
(iii) third, without limiting the rights of Buyer under
Section 4 of this Repurchase Agreement, to the Buyer, in the amount
of any unpaid Margin Deficit; and
(iv) fourth, to the Seller.
(c) Reserved.
(d) Notwithstanding the preceding provisions, if an Event of Default
has occurred, all funds in the Collection Account shall be withdrawn and
applied as determined by the Buyer.
(e) In addition, with respect to each Purchased Asset, Seller shall
deliver to the Custodian an instruction letter from Buyer, signed by the
Servicer, with respect to such Purchased Asset, instructing the Servicer, as
applicable, to remit all sums required to be remitted to the holder of such
Purchased Asset under the loan documents to the Collection Account or as
otherwise directed in a written notice signed by Buyer. Upon the occurrence of
an Event of Default, Buyer may deliver such instruction letter to the
Servicer. With respect to Third Party Servicers, the parties shall comply with
Section 16(d) hereof.
(f) Buyer shall offset against the Repurchase Price of each such
Transaction all Income and Periodic Advance Repurchase Payments actually
received by Buyer pursuant to Section 5(a), excluding any Late Payment Fees
paid pursuant to any Periodic Advance Repurchase Payments made at the
Post-Default Rate pursuant to Section 5(a).
SECTION 6. REQUIREMENTS OF LAW
(a) If any Requirement of Law (other than with respect to any
amendment made to the Buyer's certificate of incorporation and by laws or
other organizational or governing documents) or any change in the
interpretation or application thereof or compliance by the Buyer with any
request or directive (whether or not having the force of law) from any central
bank or other Governmental Authority made subsequent to the date hereof:
(i) shall subject the Buyer to any Tax or increased Tax of
any kind whatsoever with respect to this Repurchase Agreement or any
Transaction or change the basis of taxation of payments to the Buyer
in respect thereof;
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(ii) shall impose, modify or hold applicable any reserve,
special deposit, compulsory loan or similar requirement against
assets held by, deposits or other liabilities in or for the account
of, advances, or other extensions of credit by, or any other
acquisition of funds by, any office of the Buyer which is not
otherwise included in the determination of the LIBOR Rate hereunder;
(iii) shall impose on the Buyer any other condition;
and the result of any of the foregoing is to increase the cost to the Buyer,
by an amount which the Buyer deems to be material, of entering, continuing or
maintaining any Transaction or to reduce any amount due or owing hereunder in
respect thereof, then, in any such case, the Seller shall promptly pay the
Buyer such additional amount or amounts as calculated by the Buyer in good
faith as will compensate the Buyer for such increased cost or reduced amount
receivable.
(b) If the Buyer shall have determined that the adoption of or any
change in any Requirement of Law (other than with respect to any amendment
made to the Buyer's certificate of incorporation and by laws or other
organizational or governing documents) regarding capital adequacy or in the
interpretation or application thereof or compliance by the Buyer or any
corporation controlling the Buyer with any request or directive regarding
capital adequacy (whether or not having the force of law) from any
Governmental Authority made subsequent to the date hereof shall have the
effect of reducing the rate of return on the Buyer's or such corporation's
capital as a consequence of its obligations hereunder to a level below that
which the Buyer or such corporation could have achieved but for such adoption,
change or compliance (taking into consideration the Buyer's or such
corporation's policies with respect to capital adequacy) by an amount deemed
by the Buyer to be material, then from time to time, the Seller shall promptly
pay to the Buyer such additional amount or amounts as will compensate the
Buyer for such reduction.
(c) If the Buyer becomes entitled to claim any additional amounts
pursuant to this Section, it shall promptly notify the Seller of the event by
reason of which it has become so entitled. A certificate as to any additional
amounts payable pursuant to this Section submitted by the Buyer to the Seller
shall be conclusive in the absence of manifest error.
SECTION 7. TAXES.
(a) Any and all payments by the Seller under or in respect of this
Repurchase Agreement or any other Facility Documents to which the Seller is a
party shall be made free and clear of, and without deduction or withholding for
or on account of, any and all present or future taxes, levies, imposts,
deductions, charges or withholdings, and all liabilities (including penalties,
interest and additions to tax) with respect thereto, whether now or hereafter
imposed, levied, collected, withheld or assessed by any taxation authority or
other Governmental Authority (collectively, "Taxes"), unless required by law. If
the Seller shall be required under any applicable Requirement of Law to deduct
or withhold any Taxes from or in respect of any sum payable under or in respect
of this Repurchase Agreement or any of the other Facility Documents to the
Buyer, (i) Seller shall make all such deductions and withholdings in respect of
Taxes, (ii) Seller shall pay the full amount deducted or withheld in respect of
Taxes to the relevant taxation authority or other Governmental Authority in
accordance with any applicable
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Requirement of Law, and (iii) the sum payable by Seller shall be increased as
may be necessary so that after Seller has made all required deductions and
withholdings (including deductions and withholdings applicable to additional
amounts payable under this Section 7) such Buyer receives an amount equal to
the sum it would have received had no such deductions or withholdings been
made in respect of Non-Excluded Taxes. For purposes of this Repurchase
Agreement the term "Non-Excluded Taxes" are Taxes other than, in the case of a
Buyer, Taxes that are imposed on its overall net income (and franchise taxes
imposed in lieu thereof) by the jurisdiction under the laws of which such
Buyer is organized or of its applicable lending office, or any political
subdivision thereof, unless such Taxes are imposed as a result of such Buyer
having executed, delivered or performed its obligations or received payments
under, or enforced, this Repurchase Agreement or any of the other Facility
Documents (in which case such Taxes will be treated as Non-Excluded Taxes).
(b) In addition, Seller hereby agrees to pay any present or future
stamp, recording, documentary, excise, property or value-added taxes, or
similar taxes, charges or levies that arise from any payment made under or in
respect of this Repurchase Agreement or any other Facility Document or from
the execution, delivery or registration of, any performance under, or
otherwise with respect to, this Repurchase Agreement or any other Facility
Document (collectively, "Other Taxes").
(c) Seller hereby agrees to indemnify Buyer for, and to hold it
harmless against, the full amount of Non-Excluded Taxes and Other Taxes, and
the full amount of Taxes of any kind imposed by any jurisdiction on amounts
payable under this Section 7 imposed on or paid by such Buyer and any
liability (including penalties, additions to tax, interest and expenses)
arising therefrom or with respect thereto. The indemnity by Seller provided
for in this Section 7(c) shall apply and be made whether or not the
Non-Excluded Taxes or Other Taxes for which indemnification hereunder is
sought have been correctly or legally asserted. Amounts payable by Seller
under the indemnity set forth in this Section 7(c) shall be paid within ten
(10) days from the date on which Buyer makes written demand therefor.
(d) Within thirty (30) days after the date of any payment of Taxes,
Seller (or any Person making such payment on behalf of Seller) shall furnish
to Buyer for its own account evidence of payment thereof. For purposes of
subsection (e) of this Section 7, the terms "United States" and "United States
person" shall have the meanings specified in Section 7701 of the Internal
Revenue Code.
(e) Each Buyer (including for avoidance of doubt any assignee,
successor or participant) that either (i) is not incorporated under the laws
of the United States, any State thereof, or the District of Columbia or (ii)
whose name does not include "Incorporated," "Inc.," "Corporation," "Corp.,"
"P.C.," "insurance company," or "assurance company" (a "Non-Exempt Buyer")
shall deliver or cause to be delivered to Seller the following properly
completed and duly executed documents:
(i) in the case of a Non-Exempt Buyer that is not a United
States person, a complete and executed (x) U.S. Internal Revenue Form
W-8BEN with Part II completed in which Buyer claims the benefits of a
tax treaty with the United States providing for a zero or reduced
rate of withholding (or any successor forms thereto), including all
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appropriate attachments or (y) a U.S. Internal Revenue Service Form
W-8ECI (or any successor forms thereto); or
(ii) in the case of an individual, (x) a complete and
executed U.S. Internal Revenue Service Form W-8BEN (or any successor
forms thereto) and a certificate substantially in the form of Exhibit
H (a "Section 7 Certificate") or (y) a complete and executed U.S.
Internal Revenue Service Form W-9 (or any successor forms thereto);
or
(iii) in the case of a Non-Exempt Buyer that is organized
under the laws of the United States, any State thereof, or the
District of Columbia, a complete and executed U.S. Internal Revenue
Service Form W-9 (or any successor forms thereto), including all
appropriate attachments; or
(iv) in the case of a Non-Exempt Buyer that (x) is not
organized under the laws of the United States, any State thereof, or
the District of Columbia and (y) is treated as a corporation for U.S.
federal income tax purposes, a complete and executed U.S. Internal
Revenue Service Form W-8BEN claiming a zero rate of withholding (or
any successor forms thereto) and a Section 7 Certificate; or
(v) in the case of a Non-Exempt Buyer that (A) is treated as
a partnership or other non-corporate entity, and (B) is not organized
under the laws of the United States, any State thereof, or the
District of Columbia, (x)(i) a complete and executed U.S. Internal
Revenue Service Form W-8IMY (or any successor forms thereto)
(including all required documents and attachments) and (ii) a Section
7 Certificate, and (y) without duplication, with respect to each of
its beneficial owners and the beneficial owners of such beneficial
owners looking through chains of owners to individuals or entities
that are treated as corporations for U.S. federal income tax purposes
(all such owners, "beneficial owners"), the documents that would be
required by clause (i), (ii), (iii), (iv), (vi), (vii) and/or this
clause (v) with respect to each such beneficial owner if such
beneficial owner were Buyer, provided, however, that no such
documents will be required with respect to a beneficial owner to the
extent the actual Buyer is determined to be in compliance with the
requirements for certification on behalf of its beneficial owner as
may be provided in applicable U.S. Treasury regulations, or the
requirements of this clause (v) are otherwise determined to be
unnecessary, all such determinations under this clause (v) to be made
in the sole discretion of Seller, provided, however, that Buyer shall
be provided an opportunity to establish such compliance as
reasonable; or
(vi) in the case of a Non-Exempt Buyer that is disregarded
for U.S. federal income tax purposes, the document that would be
required by clause (i), (ii), (iii), (iv), (v), (vii) and/or this
clause (vi) of this Section 7(e) with respect to its beneficial owner
if such beneficial owner were the Buyer; or
(vii) in the case of a Non-Exempt Buyer that (A) is not a
United States person and (B) is acting in the capacity as an
"intermediary" (as defined in U.S. Treasury Regulations), (x)(i) a
U.S. Internal Revenue Service Form W-8IMY (or any successor form
thereto) (including all required documents and attachments) and (ii)
a Section 7 Certificate, and (y) if the intermediary is a
"non-qualified intermediary" (as defined in
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U.S. Treasury Regulations), from each person upon whose behalf the
"non-qualified intermediary" is acting the documents that would be
required by clause (i), (ii), (iii), (iv), (v), (vi), and/or this
clause (vii) with respect to each such person if each such person
were Buyer.
If the forms referred to above in this Section 7(e) that are provided
by a Buyer at the time such Buyer first becomes a party to this Repurchase
Agreement or, with respect to a grant of a participation, the effective date
thereof, indicate a United States interest withholding tax rate in excess of
zero, withholding tax at such rate shall be treated as Taxes other than
"Non-Excluded Taxes" ("Excluded Taxes") and shall not qualify as Non-Excluded
Taxes unless and until such Buyer provides the appropriate form certifying
that a lesser rate applies, whereupon withholding tax at such lesser rate
shall be considered Excluded Taxes solely for the periods governed by such
form. If, however, on the date a Person becomes an assignee, successor or
participant to this Repurchase Agreement, Buyer transferor was entitled to
indemnification or additional amounts under this Section 7, then the Buyer
assignee, successor or participant shall be entitled to indemnification or
additional amounts to the extent (and only to the extent), that the Buyer
transferor was entitled to such indemnification or additional amounts for
Non-Excluded Taxes, and the Buyer assignee, successor or participant shall be
entitled to additional indemnification or additional amounts for any other or
additional Non-Excluded Taxes.
(f) For any period with respect to which Buyer has failed to provide
Seller with the appropriate form, certificate or other document described in
subsection (e) of this Section 7 (other than (i) if such failure is due to a
change in any applicable Requirement of Law, or in the interpretation or
application thereof, occurring after the date on which a form, certificate or
other document originally was required to be provided, (ii) if such form,
certificate or other document otherwise is not required under subsection (e)
of this Section 7, or (iii) if it is legally inadvisable or otherwise
commercially disadvantageous for such Buyer to deliver such form, certificate
or other document), such Buyer shall not be entitled to indemnification or
additional amounts under subsection (a) or (c) of this Section 7 with respect
to Non-Excluded Taxes imposed by the United States by reason of such failure;
provided, however, that should a Buyer become subject to Non-Excluded Taxes
because of its failure to deliver a form, certificate or other document
required hereunder, Seller shall take such steps as such Buyer shall
reasonably request, to assist such Buyer in recovering such Non-Excluded
Taxes.
(g) Without prejudice to the survival of any other agreement of the
Seller hereunder, the agreements and obligations of the Seller contained in
this Section 7 shall survive the termination of this Repurchase Agreement.
Nothing contained in this Section 7 shall require the Buyer to make available
any of its tax returns or any other information that it deems to be
confidential or proprietary.
SECTION 8. SECURITY INTEREST; BUYER'S APPOINTMENT AS ATTORNEY-IN-FACT
(a) Although the parties intend that all Transactions hereunder be
sales and purchases and not loans (other than for accounting and tax
purposes), in the event any such Transactions are deemed to be loans, Seller
hereby pledges to Buyer as security for the performance by Seller of its
Obligations and hereby grants, assigns and pledges to Buyer a fully
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perfected first priority security interest in the Charged Assets (as defined
in that certain Deed of Charge and Assignment, between AHR Capital Limited and
▇▇▇▇▇▇ Commercial Paper Inc., UK Branch, dated as of April 19, 2007), the
Purchased Assets, the Records, and all related servicing rights, the Facility
Documents (to the extent such Facility Documents and Seller's right thereunder
relate to the Purchased Assets), any Property relating to the Purchased
Assets, all insurance policies and insurance proceeds relating to any
Purchased Asset or the related Mortgaged Property, including, but not limited
to, any payments or proceeds under any related primary insurance, hazard
insurance and, Income, the Collection Account, any Interest Rate Protection
Agreements, Loan Security Agreements, accounts (including any interest of
Seller in escrow accounts) and any other contract rights, instruments,
accounts, payments, rights to payment (including payments of interest or
finance charges) general intangibles and other assets relating to the
Purchased Assets (including, without limitation, any other accounts) or any
interest in the Purchased Assets, all collateral under any other secured debt
facility (including any facility documented as a repurchase agreement, or
similar purchase and sale agreement, or revolving credit facility) between the
Seller or its Affiliates on the one hand and the Buyer or the Buyer's
Affiliates on the other, and any proceeds (including the related
securitization proceeds) and distributions with respect to any of the
foregoing and any other property, rights, title or interests as are specified
on a Transaction Request and/or Trust Receipt, in all instances, whether now
owned or hereafter acquired, now existing or hereafter created (collectively,
the "Repurchase Assets"). Seller agrees to execute, deliver and/or file such
documents and perform such acts as may be reasonably necessary to fully
perfect Buyer's security interest created hereby. Furthermore, the Seller
hereby authorizes the Buyer to file financing statements relating to the
Repurchase Assets, as the Buyer, at its sole option, may deem appropriate. The
Seller shall pay the filing costs for any financing statement or statements
prepared pursuant to this Section.
(b) The Buyer, as "entitlement holder" (as defined in Section
8-102(a) of the Uniform Commercial Code) with respect to the CMBS Securities,
shall be entitled to receive all cash dividends and distributions paid in
respect thereof. Unless an Event of Default shall have occurred and be
continuing, Seller shall be entitled to exercise all voting and corporate
rights with respect to the CMBS Securities, and Buyer shall exercise such
rights on Seller's behalf during the time in which Buyer is the registered
holder of such Purchased Assets, provided, however, that no vote shall be cast
or corporate right exercised or other action taken which, in Buyer's good
faith judgment, would impair the CMBS Securities or which would be
inconsistent with or result in any violation of any provision of this
Repurchase Agreement.
(c) On or prior to the related Purchase Date, the Seller shall cause
each CMBS Security to be registered in the name of CSS, as agent for the
Buyer, and the Buyer or its other designee shall have the rights of
conversion, exchange, subscription and any other rights, privileges and
options pertaining to such CMBS Securities with any committee, depositary
transfer, agent, register or other designated agency upon such terms and
conditions as the Buyer may determine. Prior to the occurrence of any Event of
Default, the Buyer and its designee shall exercise such rights only on the
Seller's behalf.
The Seller hereby authorizes the Buyer to file such financing
statement or statements relating to the Repurchase Assets as the Buyer, at its
option, may deem appropriate.
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The Seller shall pay the filing costs for any financing statement or
statements prepared pursuant to this Section 8.
(d) Buyer's Appointment as Attorney in Fact. The Seller hereby
irrevocably constitutes and appoints the Buyer and any officer or agent
thereof, with full power of substitution, as its true and lawful
attorney-in-fact with full irrevocable power and authority in the place and
stead of the Seller and in the name of the Seller or in its own name, from
time to time in the Buyer's discretion, after an Event of Default shall have
occurred, for the purpose of carrying out the terms of this Repurchase
Agreement, to take any and all appropriate action and to execute any and all
documents and instruments which may be reasonably necessary or desirable to
accomplish the purposes of this Repurchase Agreement, and, without limiting
the generality of the foregoing, the Seller hereby gives the Buyer the power
and right, on behalf of the Seller, without assent by, but with notice to, the
Seller, if an Event of Default shall have occurred and be continuing, to do
the following:
(i) in the name of the Seller, or in its own name, or
otherwise, to take possession of and endorse and collect any checks,
drafts, notes, acceptances or other instruments for the payment of
moneys due with respect to any other Repurchase Assets and to file
any claim or to take any other action or proceeding in any court of
law or equity or otherwise deemed appropriate by the Buyer for the
purpose of collecting any and all such moneys due with respect to any
other Repurchase Assets whenever payable;
(ii) to pay or discharge taxes and Liens levied or placed on
or threatened against the Repurchase Assets;
(iii) (A) to direct any party liable for any payment under
any Repurchase Assets to make payment of any and all moneys due or to
become due thereunder directly to the Buyer or as the Buyer shall
direct; (B) to ask or demand for, collect, receive payment of and
receipt for, any and all moneys, claims and other amounts due or to
become due at any time in respect of or arising out of any Repurchase
Assets; (C) to sign and endorse any invoices, assignments,
verifications, notices and other documents in connection with any
Repurchase Assets; (D) to commence and prosecute any suits, actions
or proceedings at law or in equity in any court of competent
jurisdiction to collect the Repurchase Assets or any proceeds thereof
and to enforce any other right in respect of any Repurchase Assets;
(E) to defend any suit, action or proceeding brought against the
Seller with respect to any Repurchase Assets; (F) to settle,
compromise or adjust any suit, action or proceeding described in
clause (E) above and, in connection therewith, to give such
discharges or releases as the Buyer may deem appropriate; and (G)
generally, to sell, transfer, pledge and make any agreement with
respect to or otherwise deal with any Repurchase Assets as fully and
completely as though the Buyer were the absolute owner thereof for
all purposes, and to do, at the Buyer's option and the Seller's
expense, at any time, and from time to time, all acts and things
which the Buyer deems necessary to protect, preserve or realize upon
the Repurchase Assets and the Buyer's Liens thereon and to effect the
intent of this Repurchase Agreement, all as fully and effectively as
the Seller might do.
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The Seller hereby ratifies all that said attorneys shall lawfully do
or cause to be done by virtue hereof. This power of attorney is a power
coupled with an interest and shall be irrevocable.
The Seller also authorizes the Buyer, if an Event of Default shall
have occurred, from time to time, to execute, in connection with any sale
provided for in Section 14 hereof, any endorsements, assignments or other
instruments of conveyance or transfer with respect to the Repurchase Assets.
The powers conferred on the Buyer hereunder are solely to protect the
Buyer's interests in the Repurchase Assets and shall not impose any duty upon
it to exercise any such powers. The Buyer shall be accountable only for
amounts that it actually receives as a result of the exercise of such powers,
and neither it nor any of its officers, directors, employees or agents shall
be responsible to the Seller for any act or failure to act hereunder, except
for its or their own gross negligence or willful misconduct.
Upon an Event of Default, Buyer shall be entitled to all remedies
available to a secured creditor under the Uniform Commercial Code and shall
have the right to apply the Repurchase Assets or any proceeds therefrom to all
Obligations.
SECTION 9. PAYMENT, TRANSFER AND CUSTODY
(a) Unless otherwise mutually agreed in writing, all transfers of
funds to be made by the Seller hereunder shall be made in Dollars, in
immediately available funds, without deduction, set off or counterclaim, to
the Buyer at the following account maintained by the Buyer: Account No.
▇▇▇▇▇▇▇▇, for the account of ▇▇▇▇▇▇ Commercial Paper Inc., Citibank, ABA No.
▇▇▇▇▇▇▇▇▇, not later than 3:00 p.m. New York City time, on the date on which
such payment shall become due (and each such payment made after such time
shall be deemed to have been made on the next succeeding Business Day). The
Seller acknowledges that it has no rights of withdrawal from the foregoing
account.
(b) On the Purchase Date for each Transaction, ownership of the
Purchased Assets shall be transferred to the Buyer or its designee against the
simultaneous transfer of the Purchase Price to the following account of the
Seller (or as otherwise directed by the Seller): Account No. ▇▇▇▇▇▇▇, for the
account of Anthracite Capital, Inc., Citigroup Global Markets, For Further
Credit, Account No. ▇▇▇▇▇▇▇▇, JPMorgan Chase Bank, N.A., ABA No. ▇▇▇▇▇▇▇▇▇,
not later than 5:00 p.m. New York City time, simultaneously with the delivery
to the Buyer of the Purchased Assets relating to each Transaction. With
respect to the Purchased Assets being sold by a Seller on a Purchase Date, the
Seller hereby sells, transfers, conveys and assigns to Buyer or its designee
without recourse, but subject to the terms of this Repurchase Agreement, all
the right, title and interest of the Seller in and to the Purchased Assets
together with all right, title and interest in and to the proceeds of any
related Repurchase Assets.
(c) In connection with such sale, transfer, conveyance and
assignment, on or prior to each Purchase Date, the Seller shall deliver or
cause to be delivered and released to Buyer or its designee the Asset File for
the related Purchased Assets.
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SECTION 10. FEES
(a) The Seller shall pay to Buyer, due and owing on the date hereof
(and upon each anniversary of the closing, if this agreement has not been
terminated), the Commitment Fee, to the extent not already paid under the
Revolving Facility Agreement.
(b) The Seller shall pay to Buyer the Exit Fee on the date which is
120 days after the date of this Repurchase Agreement.
All payments made hereunder shall be made in Dollars, in immediately
available funds, without deduction, set-off or counterclaim, to Buyer at such
account designated by Buyer.
SECTION 11. REPRESENTATIONS
(1) The Seller represents and warrants to the Buyer that as of the
Purchase Date for any Purchased Assets by the Buyer from the Seller and as of
the date of this Repurchase Agreement and any Transaction hereunder and at all
times while the Facility Documents and any Transaction hereunder is in full
force and effect:
(a) Acting as Principal. The Seller will engage in such Transactions
as principal (or, if agreed in writing in advance of any Transaction by the
other party hereto, as agent for a disclosed principal).
(b) No Broker. The Seller has not dealt with any broker, investment
banker, agent, or other person, except for the Buyer, who may be entitled to
any commission or compensation in connection with the sale of Purchased Assets
pursuant to this Repurchase Agreement.
(c) Financial Statements. The Seller has heretofore furnished to the
Buyer a copy of its consolidated balance sheet and the consolidated balance
sheets of its consolidated Subsidiaries for the fiscal year ended December 31,
2006 and the related consolidated statements of income and retained earnings
and of cash flows for the Seller and its consolidated Subsidiaries for such
fiscal year, setting forth in each case in comparative form the figures for
the previous year, with the opinion thereon of Deloitte & Touche USA, LLP,
setting forth in comparative form the figures for the previous year. All such
financial statements are complete and correct and fairly present, in all
material respects, the consolidated financial condition of the Seller and its
Subsidiaries and the consolidated results of their operations as at such dates
and for such fiscal periods, all in accordance with GAAP applied on a
consistent basis. Since December 31, 2006, there has been no material adverse
change in the consolidated business, operations or financial condition of the
Seller and its consolidated Subsidiaries taken as a whole from that set forth
in said financial statements nor is the Seller aware of any state of facts
which (without notice or the lapse of time) would or could result in any such
material adverse change or could have a Material Adverse Effect. The Seller
does not have, on the date of the statements delivered pursuant to this
section (the "Statement Date"), any liabilities, direct or indirect, fixed or
contingent, matured or unmatured, known or unknown, or liabilities for taxes,
long-term leases or unusual forward or long-term commitments not disclosed by,
or reserved against in, said balance sheet and related statements, and at the
present time there are no material unrealized
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or anticipated losses from any loans, advances or other commitments of the
Seller except as heretofore disclosed to the Buyer in writing.
(d) Organization, Etc. The Seller is a corporation duly organized,
validly existing and in good standing under the laws of Maryland. The Seller
(a) has all requisite corporate or other power, and has all governmental
licenses, authorizations, consents and approvals necessary to own its assets
and carry on its business as now being or as proposed to be conducted, except
where the lack of such licenses, authorizations, consents and approvals would
not be reasonably likely to have a Material Adverse Effect; (b) is qualified
to do business and is in good standing in all other jurisdictions in which the
nature of the business conducted by it makes such qualification necessary,
except where failure so to qualify would not be reasonably likely (either
individually or in the aggregate) to have a Material Adverse Effect; and (c)
has full power and authority to execute, deliver and perform its obligations
under the Facility Documents.
(e) Authorization, Compliance, Etc. The execution and delivery of,
and the performance by Seller of its obligations under, the Facility Documents
to which it is a party (a) are within such party's powers, (b) have been duly
authorized by all requisite action, (c) do not violate any provision of
applicable law, rule or regulation, or any order, writ, injunction or decree
of any court or other Governmental Authority, or its organizational documents,
(d) do not violate any indenture, agreement, document or instrument to which
the Seller or any of respective their Subsidiaries is a party, or by which any
of them or any of their properties, any of the Repurchase Assets is bound or
to which any of them is subject and (e) are not in conflict with, do not
result in a breach of, or constitute (with due notice or lapse of time or
both) a default under, or except as may be provided by any Facility Document,
result in the creation or imposition of any Lien upon any of the property or
assets of Seller or any of their respective subsidiaries pursuant to, any such
indenture, agreement, document or instrument. Seller is not required to obtain
any consent, approval or authorization from, or to file any declaration or
statement with, any Governmental Authority in connection with or as a
condition to the consummation of the Transactions contemplated herein and the
execution, delivery or performance of the Facility Documents to which it is a
party.
(f) Litigation. There are no actions, suits, arbitrations,
investigations (including, without limitation, any of the foregoing which are
pending or threatened) or other legal or arbitrable proceedings affecting
Seller or any of its Subsidiaries or affecting any of the Repurchase Assets or
any of the other properties of Seller before any Governmental Authority which
(i) questions or challenges the validity or enforceability of the Facility
Documents or any action to be taken in connection with the transactions
contemplated hereby, (ii) makes a claim or claims in an aggregate amount
greater than $5,000,000, (iii) individually or in the aggregate, if adversely
determined, would have a Material Adverse Effect, or (iv) requires filing with
the SEC in accordance with its regulations.
(g) Purchased Assets.
(i) The Seller has not assigned, pledged, or otherwise
conveyed or encumbered any Eligible Asset to any other Person, and
immediately prior to the sale of such Eligible Asset to the Buyer,
the Seller was the sole owner of such Eligible Asset and
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had good and marketable title thereto, free and clear of all Liens,
in each case except for assignments and Liens to be released
simultaneously with the sale to the Buyer hereunder.
(ii) The provisions of this Repurchase Agreement are
effective to either constitute a sale of Repurchase Assets to the
Buyer or to create in favor of the Buyer a valid security interest in
all right, title and interest of the Seller in, to and under the
Repurchase Assets.
(h) Chief Executive Office/Jurisdiction of Organization. On the
Effective Date, the Seller's chief executive office is, and has been, located
at c/o Blackrock Financial Management, Inc., ▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇. The Seller's jurisdiction of organization is Maryland.
(i) Location of Books and Records. The location where the Seller
keeps its books and records, including all computer tapes and records related
to the Repurchase Assets is its chief executive offices.
(j) Enforceability. This Repurchase Agreement and all of the other
Facility Documents executed and delivered by the Seller in connection herewith
are legal, valid and binding obligations of the Seller and are enforceable
against the Seller in accordance with their terms except as such
enforceability may be limited by (i) the effect of any applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting creditors
rights generally and (ii) general principles of equity.
(k) Ability to Perform. Seller does not believe, nor does it have any
reason or cause to believe, that it cannot perform each and every covenant
contained in the Facility Documents to which it is a party on its part to be
performed
(l) No Default. No Default or Event of Default has occurred and is
continuing.
(m) Underwriting Guidelines. The Underwriting Guidelines provided to
Buyer are the true and correct Underwriting Guidelines of the Seller.
(n) Adverse Selection. The Seller has not selected the Purchased
Assets in a manner so as to adversely affect Buyer's interests.
(o) Tangible Net Worth. As of December 31, 2006, the Tangible Net
Worth of the Seller was not less than $656,109,000.
(p) Indebtedness. The Seller does not have any Indebtedness, except
as disclosed on Schedule 2 to this Repurchase Agreement.
(q) Accurate and Complete Disclosure. The information, reports,
financial statements, exhibits and schedules furnished in writing by or on
behalf of the Seller to the Buyer in connection with the negotiation,
preparation or delivery of this Repurchase Agreement and the other Facility
Documents or included herein or therein or delivered pursuant hereto or
thereto,
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when taken as a whole, do not contain any untrue statement of material fact or
omit to state any material fact necessary to make the statements herein or
therein, in light of the circumstances under which they were made, not
misleading. All written information furnished after the date hereof by or on
behalf of the Seller to the Buyer in connection with this Repurchase Agreement
and the other Facility Documents and the transactions contemplated hereby and
thereby including without limitation, the information set forth in the related
Purchased Asset Schedule, will be true, complete and accurate in every
material respect, or (in the case of projections) based on reasonable
estimates, on the date as of which such information is stated or certified.
There is no fact known to the Seller, after due inquiry, that could reasonably
be expected to have a Material Adverse Effect that has not been disclosed
herein, in the other Facility Documents or in a report, financial statement,
exhibit, schedule, disclosure letter or other writing furnished to the Buyer
for use in connection with the transactions contemplated hereby or thereby.
(r) Margin Regulations. The use of all funds acquired by the Seller
under this Repurchase Agreement will not conflict with or contravene any of
Regulations T, U or X promulgated by the Board of Governors of the Federal
Reserve System as the same may from time to time be amended, supplemented or
otherwise modified.
(s) Investment Company. Neither the Seller nor any of its
Subsidiaries is an "investment company" or a company "controlled" by an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended.
(t) Solvency. As of the date hereof and immediately after giving
effect to each Transaction, the fair value of the assets of the Seller is
greater than the fair value of the liabilities (including, without limitation,
contingent liabilities if and to the extent required to be recorded as a
liability on the financial statements of the Seller in accordance with GAAP)
of such party and such party is solvent and, after giving effect to the
transactions contemplated by this Repurchase Agreement and the other Facility
Documents, will not be rendered insolvent or left with an unreasonably small
amount of capital with which to conduct its business and perform its
obligations. The Seller does not intend to incur, nor does it believe that it
has incurred, debts beyond its ability to pay such debts as they mature. The
Seller is not contemplating the commencement of an insolvency, bankruptcy,
liquidation, or consolidation proceeding or the appointment of a receiver,
liquidator, conservator, trustee, or similar official in respect of itself or
any of its property.
(u) ERISA.
(i) No liability under Section 4062, 4063, 4064 or 4069 of
ERISA has been or is expected by the Seller to be incurred by the
Seller or any ERISA Affiliate thereof with respect to any Plan which
is a Single-Employer Plan in an amount that could reasonably be
expected to have a Material Adverse Effect.
(ii) No Plan which is a Single-Employer Plan had an
accumulated funding deficiency, whether or not waived, as of the last
day of the most recent fiscal year of such Plan ended prior to the
date hereof. Neither the Seller nor any ERISA Affiliate thereof is
(A) required to give security to any Plan which is a Single-Employer
Plan pursuant to Section 401(a)(29) of the Code or Section 307 of
ERISA, or (B) subject to a Lien in favor of such a Plan under Section
412(n) of the Code or Section 302(f) of ERISA.
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(iii) Each Plan of the Seller, its Subsidiaries and each of
its ERISA Affiliates is in compliance with the applicable provisions
of ERISA and the Code, except where the failure to comply would not
result in any Material Adverse Effect.
(iv) Neither the Seller nor any of its Subsidiaries has
incurred a tax liability under Chapter 43 of the Code or a penalty
under Section 502 of ERISA which has not been paid in full, except
where the incurrence of such tax or penalty would not result in a
Material Adverse Effect.
(v) Neither the Seller nor any of its Subsidiaries nor any
ERISA Affiliate thereof has incurred or reasonably expects to incur
any withdrawal liability under Section 4201 of ERISA as a result of a
complete or partial withdrawal from a Multiemployer Plan in an amount
that could reasonably be expected to have a Material Adverse Effect.
(v) Taxes. Each of the Seller and its Subsidiaries have timely filed
all tax returns that are required to be filed by them and have timely paid all
Taxes due, except for any such Taxes as are being appropriately contested in
good faith by appropriate proceedings diligently conducted and with respect to
which adequate reserves have been provided. There are no Liens for Taxes,
except for statutory liens for Taxes not yet due and payable.
(w) No Reliance. The Seller has made its own independent decisions to
enter into the Facility Documents and each Transaction and as to whether such
Transaction is appropriate and proper for it based upon its own judgment and
upon advice from such advisors (including without limitation, legal counsel
and accountants) as it has deemed necessary. The Seller is not relying upon
any advice from Buyer as to any aspect of the Transactions, including without
limitation, the legal, accounting or tax treatment of such Transactions.
(x) Plan Assets. The Seller is not an employee benefit plan as
defined in Section 3 of Title I of ERISA, or a plan described in Section
4975(e)(1) of the Code, and the Purchased Assets are not "plan assets" within
the meaning of 29 CFR ss.2510.3-101 in the Seller's hands.
(y) No Prohibited Persons. Neither the Seller nor any of its
Affiliates, officers, directors, partners or members, is an entity or person
(or to the Seller's knowledge, owned or controlled by an entity or person):
(i) that is listed in the Annex to, or is otherwise subject to the provisions
of Executive Order 13224 issued on September 24, 2001 ("EO13224"); (ii) whose
name appears on the United States Treasury Department's Office of Foreign
Assets Control ("OFAC") most current list of "Specifically Designated National
and Blocked Persons" (which list may be published from time to time in various
mediums including, but not limited to, the OFAC website,
http:▇▇▇.▇▇▇▇▇.▇▇▇/▇▇▇▇/▇▇▇▇▇▇.▇▇▇); (iii) who commits, threatens to commit or
supports "terrorism", as that term is defined in EO13224; or (iv) who is
otherwise affiliated with any entity or person listed above (any and all
parties or persons described in clauses (i) through (iv) above are herein
referred to as a "Prohibited Person").
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(z) Real Estate Investment Trust. Seller has not engaged in any
material "prohibited transactions" as defined in Section 857(b)(6)(B)(iii) and
(C) of the Code. Seller for its current "tax year" (as defined in the Code) is
entitled to a dividends paid deduction under the requirements of Section 857
of the Code with respect to any dividends paid by it with respect to each such
year for which it claims a deduction in its Form 1120-REIT filed with the
United States Internal Revenue Service for such year.
SECTION 12. COVENANTS
On and as of the date of this Repurchase Agreement and each Purchase
Date and at all times until this Repurchase Agreement is no longer in force,
the Seller covenants as follows:
(a) Preservation of Existence; Compliance with Law. The Seller shall:
(i) Preserve and maintain its legal existence and all of its
material rights, privileges, licenses and franchises necessary for
the operation of its business;
(ii) Comply with the requirements of all applicable laws,
rules, regulations and orders, whether now in effect or hereafter
enacted or promulgated by any applicable Governmental Authority
(including, without limitation, all environmental laws);
(iii) Maintain all licenses, permits or other approvals
necessary for such party to conduct its business and to perform its
obligations under the Facility Documents, and shall conduct its
business strictly in accordance with applicable law;
(iv) Keep adequate records and books of account, in which
complete entries will be made in accordance with GAAP consistently
applied; and
(v) Permit representatives of the Buyer, upon reasonable
notice (unless an Event of Default shall have occurred and is
continuing, in which case, no prior notice shall be required), during
normal business hours, to examine, copy and make extracts from its
books and records, to inspect any of its Properties, and to discuss
its business and affairs with its officers, all to the extent
reasonably requested by the Buyer, subject to the provisions set
forth in Section 17 hereof.
(b) Taxes. The Seller shall timely file all tax returns that are
required to be filed by it and shall timely pay all Taxes due, except for any
such Taxes as are being appropriately contested in good faith by appropriate
proceedings diligently conducted with respect to which adequate reserves have
been provided.
(c) Notice of Proceedings or Adverse Change. The Seller shall give
notice to the Buyer immediately after a Responsible Officer of the Seller has
any knowledge of:
(i) the occurrence of any Default or Event of Default;
(ii) any (a) default or event of default under any
Indebtedness of Seller or (b) litigation, investigation, regulatory
action or proceeding that is pending or threatened
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by or against such party in any federal or state court or before any
Governmental Authority which, if not cured or if adversely
determined, would reasonably be expected to have a Material Adverse
Effect or constitute a Default or Event of Default, and (c) any
Material Adverse Effect with respect to such party;
(iii) any litigation or proceeding that is pending or
threatened against (a) the Seller in which the amount involved
exceeds $5,000,000 and is not covered by insurance, in which
injunctive or similar relief is sought, or which, would reasonably be
expected to have a Material Adverse Effect and (b) any litigation or
proceeding that is pending or threatened in connection with any of
the Repurchase Assets, which, if adversely determined, would
reasonably be expected to have a Material Adverse Effect;
(iv) and, as soon as reasonably possible, notice of any of
the following events:
(A) a change in the insurance coverage of the
Seller, with a copy of evidence of same attached;
(B) any material change in accounting policies or
financial reporting practices of the Seller;
(C) promptly upon receipt of notice or knowledge of
any Lien or security interest (other than security interests
created hereby or under any other Facility Document) on, or
claim asserted against, any of the Repurchase Assets; and
(D) any other event, circumstance or condition that
has resulted, or has a possibility of resulting, in a
Material Adverse Effect; and
(v) Promptly, but no later than two (2) Business Days after
the Seller receives any of the same, deliver to the Buyer a true,
complete, and correct copy of any schedule, report, notice, or any
other document delivered to the Seller by any Person pursuant to, or
in connection with, any of the Repurchase Assets.
(d) Financial Reporting. The Seller shall maintain a system of
accounting established and administered in accordance with GAAP, and furnish
to the Buyer:
(i) Within ninety (90) days after the close of each fiscal
year, Financial Statements, including a statement of income and
changes in shareholders' equity of the Seller for such year, and the
related balance sheet as at the end of such year, all in reasonable
detail and accompanied by an opinion of an accounting firm as to said
financial statements;
(ii) Within forty-five (45) days after the close of each of
the Seller's first three fiscal quarters in each fiscal year
unaudited balance sheets and income statements, for the period from
the beginning of such fiscal year to the end of such third fiscal
quarter, subject, however, to year end adjustments;
(iii) Reserved;
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(iv) Simultaneously with the furnishing of each of the
Financial Statements to be delivered pursuant to subsection (i)-(ii)
above, or monthly upon Buyer's request, a certificate in the form of
Exhibit F hereto and certified by an executive officer of the Seller;
(v) If applicable, copies of any 10-Ks, 10-Qs, registration
statements and other "corporate finance" SEC filings (other than
8-Ks) by the Seller, within 5 Business Days of their filing with the
SEC; provided, that, the Seller or any Affiliate will provide the
Buyer with a copy of the annual 10-K filed with the SEC by the Seller
or its Affiliates, no later than 90 days after the end of the year;
and
(vi) Promptly, from time to time, such other information
regarding the business affairs, operations and financial condition of
the Seller as the Buyer may reasonably request.
(e) Visitation and Inspection Rights. The Seller shall permit the
Buyer to inspect, and take all other actions permitted under Section 17
hereof.
(f) Reimbursement of Expenses. The Seller shall promptly reimburse
the Buyer for all expenses as the same are incurred by the Buyer as required
by Section 15(b) hereof.
(g) Further Assurances. The Seller shall execute and deliver to the
Buyer all further documents, financing statements, agreements and instruments,
and take all further action that may be required under applicable law, or that
the Buyer may reasonably request, in order to effectuate the transactions
contemplated by this Repurchase Agreement and the Facility Documents or,
without limiting any of the foregoing, to grant, preserve, protect and perfect
the validity and first-priority of the security interests created or intended
to be created hereby. The Seller shall do all things necessary to preserve the
Repurchase Assets so that they remain subject to a first priority perfected
security interest hereunder. Without limiting the foregoing, the Seller will
comply with all rules, regulations, and other laws of any Governmental
Authority and cause the Repurchase Assets to comply with all applicable rules,
regulations and other laws. The Seller will not allow any default for which
the such party is responsible to occur under any Repurchase Assets or any
Facility Document and the Seller shall fully perform or cause to be performed
when due all of its obligations under any Repurchase Assets or the Facility
Documents.
(h) True and Correct Information. All information, reports, exhibits,
schedules, financial statements or certificates of Seller or any of its
Affiliates thereof or any of their officers furnished to Buyer hereunder and
during Buyer's diligence of the Seller are and will be true and complete and
do not omit to disclose any material facts necessary to make the statements
therein or therein, in light of the circumstances in which they are made, not
misleading. All required financial statements, information and reports
delivered by the Seller to the Buyer pursuant to this Repurchase Agreement
shall be prepared in accordance with GAAP, or as applicable, to SEC filings,
the appropriate SEC accounting requirements.
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(i) ERISA Events.
(i) Promptly upon becoming aware of the occurrence of any
Event of ERISA Termination which together with all other Events of
ERISA Termination occurring within the prior 12 months involve a
payment of money by or a potential aggregate liability of the Seller
or any ERISA Affiliate thereof or any combination of such entities in
excess of $5,000,000 the Seller shall give the Buyer a written notice
specifying the nature thereof, what action the Seller or any ERISA
Affiliate thereof has taken and, when known, any action taken or
threatened by the Internal Revenue Service, the Department of Labor
or the PBGC with respect thereto;
(ii) Promptly upon receipt thereof, the Seller shall furnish
to the Buyer copies of (i) all notices received by the Seller or any
ERISA Affiliate thereof of the PBGC's intent to terminate any Plan or
to have a trustee appointed to administer any Plan; (ii) all notices
received by the Seller or any ERISA Affiliate thereof from the
sponsor of a Multiemployer Plan pursuant to Section 4202 of ERISA
involving withdrawal liability in excess of $5,000,000; and (iii) all
funding waiver requests filed by the Seller or any ERISA Affiliate
thereof with the Internal Revenue Service with respect to any Plan,
the accrued benefits of which exceed the present value of the plan
assets as of the date the waiver request is filed, and all
communications received by the Seller or any ERISA Affiliate thereof
from the Internal Revenue Service with respect to any such funding
waiver request.
(j) Financial Condition Covenants.
(i) Maintenance of Tangible Net Worth. The Seller shall
maintain a Tangible Net Worth at the end of each fiscal quarter of
not less than the sum of (i) $400,000,000 plus (ii) an amount equal
to 75% of any Equity Proceeds.
(ii) Maintenance of Ratio of Total Indebtedness to Tangible
Net Worth. The Seller shall maintain the ratio of Indebtedness
(excluding non-recourse Indebtedness) to Tangible Net Worth at the
end of each fiscal quarter no greater than 3:1.
(iii) Debt Service Coverage Ratio. The Seller shall maintain
a Debt Service Coverage Ratio of no less than 1.20:1.
(iv) Maintenance of Liquidity. The Seller shall ensure that,
as of the end of each fiscal quarter, the sum of (a) Cash, (b)
unencumbered and unpledged marketable securities and (c) Unfunded
Margin Amount shall not be not less than $10,000,000.
(v) Reserved.
(k) Reserved.
(l) No Adverse Selection. The Seller shall not select Eligible Assets
to be sold to Buyer as Purchased Assets using any type of adverse selection or
other selection criteria which would adversely affect the Buyer.
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(m) Servicer. The Seller shall not cause the Purchased Assets to be
serviced by any servicer other than a servicer expressly approved in writing
by Buyer, which approval shall be deemed granted by Buyer with respect to the
Seller with the execution of this Repurchase Agreement. Upon the occurrence of
any of the following (a) the occurrence and continuation of an Event of
Default, (b) the fifth Business Day of each month, or (c) upon the request of
Buyer, Seller shall cause Servicer to provide to Buyer, electronically, in a
format mutually acceptable to Buyer and Seller, the Servicing Report.
(n) Insurance. The Manager shall continue to maintain Fidelity
Insurance in an aggregate amount at least equal to $5,000,000. The Seller
shall maintain Fidelity Insurance in respect of its officers, employees and
agents, with respect to any claims made in connection with all or any portion
of the Repurchase Assets. The Seller shall notify the Buyer of any material
change in the terms of any such Fidelity Insurance.
(o) Books and Records. The Seller shall, to the extent practicable,
maintain and implement administrative and operating procedures (including,
without limitation, an ability to recreate records evidencing the Repurchase
Assets in the event of the destruction of the originals thereof), and keep and
maintain or obtain, as and when required, all documents, books, records and
other information reasonably necessary or advisable for the collection of all
Repurchase Assets.
(p) Illegal Activities. Seller shall not engage in any conduct or
activity that could subject its assets to forfeiture or seizure.
(q) Material Change in Business. Seller shall not make any material
change in the nature of its business as carried on at the date hereof.
(r) Limitation on Dividends and Distributions. After the occurrence
of an Event of Default, the Seller shall not make any payment on account of,
or set apart assets for, a sinking or other analogous fund for the purchase,
redemption, defeasance, retirement or other acquisition of any equity interest
of the Seller, whether now or hereafter outstanding, or make any other
distribution or dividend in respect of any of the foregoing or to any
shareholder or equity owner of the Seller, either directly or indirectly,
whether in cash or property or in obligations of the Seller or any of the
Seller's consolidated Subsidiaries, except to the extent necessary to maintain
Seller's REIT status.
(s) Disposition of Assets; Liens. Seller shall not create, incur,
assume or suffer to exist any mortgage, pledge, Lien, charge or other
encumbrance of any nature whatsoever on any of the Repurchase Assets, whether
real, personal or mixed, now or hereafter owned, other than the Liens created
in connection with the transactions contemplated by this Repurchase Agreement;
nor shall Seller cause any of the Purchased Assets to be sold, pledged,
assigned or transferred.
(t) Transactions with Affiliates. Seller shall not enter into any
transaction, including, without limitation, the purchase, sale, lease or
exchange of property or assets or the rendering or accepting of any service
with any Affiliate, unless such transaction is (a) not otherwise prohibited in
this Repurchase Agreement, (b) in the ordinary course of the Seller's
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business and (c) upon fair and reasonable terms no less favorable to the
Seller, as the case may be, than it would obtain in a comparable arm's length
transaction with a Person which is not an Affiliate.
(u) ERISA Matters.
(i) The Seller shall not permit any event or condition which
is described in the definition of "Event of ERISA Termination" to
occur or exist with respect to any Plan or Multiemployer Plan if such
event or condition, together with all other events or conditions
described in the definition of Event of ERISA Termination occurring
within the prior 12 months, involves the payment of money by or an
incurrence of liability of the Seller or any ERISA Affiliate thereof,
or any combination of such entities in an amount in excess of
$5,000,000.
(ii) Seller shall not be an employee benefit plan as defined
in Section 3 of Title I of ERISA, or a plan described in Section
4975(e)(1) of the Code and the Seller shall not use "plan assets"
within the meaning of 29 CFR ss.2510.3-101 to engage in this
Repurchase Agreement or the Transactions hereunder.
(v) Consolidations, Mergers and Sales of Assets. The Seller shall not
(i) consolidate or merge with or into any other Person or (ii) sell, lease or
otherwise transfer all or substantially all of its assets to any other Person;
provided that the Seller may merge or consolidate with another Person if the
Seller is the corporation surviving such merger.
(w) Reserved.
(x) Guarantees. Seller shall not create, incur, assume or suffer to
exist any Guarantees, except (i) to the extent reflected in such party's
financial statements or notes thereto and (ii) to the extent the aggregate
Guarantees of the Seller do not exceed $800,000,000.
(y) Underwriting Guidelines. Without the prior written consent of
Buyer, the Seller shall not amend or otherwise modify the Underwriting
Guidelines. Without limiting the foregoing, in the event that the Seller makes
any amendment or modification to the Underwriting Guidelines, the Seller shall
promptly deliver to Buyer a complete copy of the amended or modified
Underwriting Guidelines.
(z) Reserved.
(aa) Records.
(i) Seller shall collect and maintain or cause to be
collected and maintained all Records relating to the Purchased Assets
in accordance with industry custom and practice for assets similar to
the Purchased Assets, including those maintained pursuant to the
preceding subparagraph, and all such Records shall be in Custodian's
possession unless Buyer otherwise approves. Seller will not allow any
such papers, records or files that are an original or an only copy to
leave Custodian's possession, except for individual items removed in
connection with servicing a specific Eligible Asset, in which event
Seller will obtain or cause to be obtained a receipt from a
financially responsible person
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for any such paper, record or file. Seller or the Servicer of the
Purchased Assets will maintain all such Records not in the possession
of Custodian in good and complete condition in accordance with
industry practices for assets similar to the Purchased Assets and
preserve them against loss.
(ii) For so long as Buyer has an interest in or lien on any
Purchased Asset, Seller will hold or cause to be held all related
Records in trust for Buyer. Seller shall notify, or cause to be
notified, every other party holding any such Records of the interests
and liens in favor of Buyer granted hereby.
(iii) Upon reasonable advance notice from Custodian or
Buyer, Seller shall (x) make any and all such Records available to
Custodian or Buyer to examine any such Records, either by its own
officers or employees, or by agents or contractors, or both, and make
copies of all or any portion thereof, and (y) permit Buyer or its
authorized agents to discuss the affairs, finances and accounts of
Seller with its chief operating officer and chief financial officer
and to discuss the affairs, finances and accounts of Seller with its
independent certified public accountants.
(bb) Indebtedness. Seller shall not incur any additional Indebtedness
without the prior written consent of Buyer.
(cc) Reserved.
(dd) Management Fees. Seller shall not enter into any arrangement for
the payment of, or pay, management, advisory or similar fees, except
management and advisory fees payable to the applicable Blackrock Entity
pursuant to the Blackrock Management Agreement as it may be amended, provided
that such fees are not increased in excess of the amounts permitted by clause
(ee) of this Section or management fees to its corporate services provider
paid in the ordinary course of business; provided, that in any event no such
fees may be paid (but may accrue) during the continuance of an Event of
Default.
(ee) Modification of Certain Agreements.
(i) Without the prior written consent of the Buyer, Seller
shall not consent to (a) any material amendment, supplement, waiver
or other modification of, or enter into any forbearance from
exercising any material rights with respect to the terms or
provisions contained in any Organic Document or (b) any increase in
any fees payable under the Blackrock Management Agreement in excess
of five percent (5%) per annum of the gross value of the assets held
by Seller from time to time.
(ii) Without the prior written consent of the Buyer, Seller
shall not amend or otherwise modify the Underwriting Guidelines.
Notwithstanding the preceding sentence, in the event that Seller
makes any amendment or modification to the Underwriting Guidelines,
Seller shall promptly deliver to the Buyer a complete copy of the
amended or modified Underwriting Guidelines.
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SECTION 13. EVENTS OF DEFAULT
If any of the following events (each an "Event of Default") occur,
the Seller and Buyer shall have the rights set forth in Section 14, as
applicable:
(a) Payment Default. The Seller shall default in the payment of (i)
any Price Differential, Repurchase Price or Margin Call or (ii) any other
Obligations, when the same shall become due and payable, whether at the due
date thereof, or by acceleration or otherwise (and such failure to pay such
Obligations under this clause (ii) shall continue for more than 5 Business
Days after notice thereof); or
(b) Representation and Warranty Breach. Any representation, warranty
or certification made or deemed made herein or in any other Facility Document
by the Seller or any certificate furnished to the Buyer pursuant to the
provisions hereof or thereof or any information with respect to the Eligible
Assets furnished in writing by on behalf of the Seller shall prove to have
been untrue or misleading in any material respect as of the time made or
furnished (other than the representations and warranties set forth in Schedule
1, which shall be considered solely for the purpose of determining the Market
Value of the Purchased Assets; unless (i) the Seller, shall have made any such
representations and warranties with actual knowledge that they were materially
false or misleading at the time made; or (ii) any such representations and
warranties have been determined in good faith by the Buyer in its sole
discretion to be materially false or misleading on a regular basis); or
(c) Immediate Covenant Default. The failure of the Seller to perform,
comply with or observe any term, covenant or agreement applicable to the
Seller contained in any of Sections 12(a), (j), (p),(q), (r), (s), (v), (x) or
(y); or
(d) Additional Covenant Defaults. The Seller shall fail to observe or
perform any other covenant or agreement contained in this Repurchase Agreement
(and not identified in clause (c) of Section 13.01) or any other Facility
Document, and if such default shall be capable of being remedied, and such
failure to observe or perform shall continue unremedied for a period of 5
Business Days; or
(e) Judgments. A judgment or judgments for the payment of money in
excess of (a) $5,000,000 in the aggregate shall be rendered against the Seller
or any of its Affiliates or (b) $10,000,000, if the Tangible Net Worth of
Seller is less than $400,000,000, or $20,000,000, if the Tangible Net Worth of
Seller is greater than or equal to $400,000,000, shall be rendered against the
Seller by one or more courts, administrative tribunals or other bodies having
jurisdiction and the same shall not be satisfied, discharged (or provision
shall not be made for such discharge) or bonded, or a stay of execution
thereof shall not be procured, within 30 days from the date of entry thereof,
and the Seller or any such Affiliate shall not, within said period of 30 days,
or such longer period during which execution of the same shall have been
stayed or bonded, appeal therefrom and cause the execution thereof to be
stayed during such appeal; or
(f) Cross-Default. Any "event of default" or any other default which
permits a demand for, or requires, the early repayment of obligations due by
the Seller or its Affiliates of greater than or equal to $15 million under any
agreement (after the expiration of any applicable
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grace period under any such agreement) relating to any Indebtedness of the
Seller or any Affiliate, as applicable, or any default under any Obligation
when due; or
(g) Insolvency Event. An Insolvency Event shall have occurred with
respect to the Seller or Manager; or
(h) Enforceability. For any reason, this Repurchase Agreement or any
Facility Document at any time shall not be in full force and effect in all
material respects or shall not be enforceable in all material respects in
accordance with its terms, or any Lien granted pursuant thereto shall fail to
be perfected and of first priority, or any Person (other than Buyer) shall
contest the validity, enforceability, perfection or priority of any Lien
granted pursuant thereto, or any party thereto (other than Buyer) shall seek
to disaffirm, terminate, limit or reduce its obligations hereunder; or
(i) Liens. The Seller shall grant, or suffer to exist, any Lien on
any Repurchase Asset (except any Lien in favor of the Buyer); or at least one
of the following fails to be true (A) the Repurchase Assets shall have been
sold to the Buyer, or (B) the Liens contemplated hereby are first priority
perfected Liens on any Repurchase Assets in favor of the Buyer or shall be
Liens in favor of any Person other than the Buyer; or
(j) Reserved; or
(k) ERISA. (i) any Person shall engage in any "prohibited
transaction" (as defined in Section 406 of ERISA or Section 4975 of the Code)
involving any Plan, (ii) any "accumulated funding deficiency" (as defined in
Section 302 of ERISA), whether or not waived, shall exist with respect to any
Plan or any Lien in favor of the PBGC or a Plan shall arise on the assets of
the Seller or any ERISA Affiliate, (iii) a Reportable Event shall occur with
respect to, or proceedings shall commence to have a trustee appointed, or a
trustee shall be appointed, to administer or to terminate, any Plan, which
Reportable Event or commencement of proceedings or appointment of a trustee
is, in the reasonable opinion of the Buyer, likely to result in the
termination of such Plan for purposes of Title IV of ERISA, (iv) any Plan
shall terminate for purposes of Title IV of ERISA, (v) the Seller or any ERISA
Affiliate shall, or in the reasonable opinion of the Buyer is likely to, incur
any liability in connection with a withdrawal from, or the insolvency or
reorganization of, a Multiemployer Plan or (vi) any other event or condition
shall occur or exist with respect to a Plan; and in each case in clauses (i)
through (vi) above, such event or condition, together with all other such
events or conditions, if any, could reasonably be expected to have a Material
Adverse Effect; or
(l) Change of Control. A Change of Control of Seller shall have
occurred; or
(m) Reserved; or
(n) Reserved; or
(o) Assignment. Assignment or attempted assignment by Seller of this
Repurchase Agreement or any rights hereunder without first obtaining the
specific written consent of Buyer, or the granting by Seller of any security
interest, lien or other encumbrances on any Purchased Assets to any person
other than Buyer; or
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(p) Government Action. Any Governmental Authority or any person,
agency or entity acting or purporting to act under governmental authority
shall have taken any action to condemn, seize or appropriate, or to assume
custody or control of, all or any substantial part of the Property of Seller
or any Affiliate thereof, or shall have taken any action to displace the
management of Seller or any Affiliate thereof or to curtail its authority in
the conduct of the business of Seller or any Affiliate thereof, or takes any
action in the nature of enforcement to remove, limit or restrict the approval
of Seller or Affiliate as an issuer, buyer or a seller/servicer of Eligible
Assets or securities backed thereby, and such action provided for in this
subparagraph shall not have been discontinued or stayed within 30 days; or
(q) Inability to Perform. An officer of Seller shall admit its
inability to, or its intention not to, perform any of Seller's Obligations or
hereunder; or
(r) Financial Statements. Seller's audited annual financial
statements or the notes thereto or other opinions or conclusions stated
therein shall be qualified or limited by reference to the status of Seller as
a "going concern" or a reference of similar import; or
(s) Qualification as a REIT. The failure of Seller (i) to continue to
be qualified as a REIT as defined in Section 856 of the Code or (ii) to
continue to be entitled to a dividend paid deduction under Section 857 of the
Code with respect to dividends paid by it with respect to each taxable year
for which it claims a deduction on its Form 1120- REIT filed with the United
States Internal Revenue Service for such year, or the entering into by Seller
of "prohibited transactions" as defined in Sections 857(b)(6)(B)(iii) of the
Code (taking into account Sections 857(b)(6)(C), 857(b)(6)(D) and 857(b)(6)(E)
of the Code) or (iii) to satisfy any of the income or asset tests required to
be satisfied by a REIT.
SECTION 14. REMEDIES
(a) If an Event of Default occurs with respect to the Seller, the
following rights and remedies are available to the Buyer; provided, that an
Event of Default shall be deemed to be continuing unless expressly waived by
the Buyer in writing.
(i) At the option of the Buyer, exercised by written notice
to the Seller (which option shall be deemed to have been exercised,
even if no notice is given, immediately upon the occurrence of an
Insolvency Event of the Seller), the Repurchase Date for each
Transaction hereunder, if it has not already occurred, shall be
deemed immediately to occur. The Buyer shall (except upon the
occurrence of an Insolvency Event of the Seller) give notice to the
Seller of the exercise of such option as promptly as practicable.
(ii) If the Buyer exercises or is deemed to have exercised
the option referred to in subsection (a)(i) of this Section,
(A) the Seller's obligations in such Transactions
to repurchase all Purchased Assets, at the Repurchase Price
therefor on the Repurchase Date determined in accordance
with subsection (a)(i) of this Section, (1) shall thereupon
become immediately due and payable and (2) all Income paid
after such exercise or deemed exercise shall be retained by
the Buyer and applied to the
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aggregate unpaid Repurchase Price and any other amounts owed
by the Seller hereunder;
(B) to the extent permitted by applicable law, the
Repurchase Price with respect to each such Transaction shall
be increased by the aggregate amount obtained by daily
application of, on a 360 day per year basis for the actual
number of days during the period from and including the date
of the exercise or deemed exercise of such option to but
excluding the date of payment of the Repurchase Price as so
increased, (x) the Post-Default Rate in effect following an
Event of Default to (y) the Repurchase Price for such
Transaction as of the Repurchase Date as determined pursuant
to subsection (a)(i) of this Section (decreased as of any
day by (i) any amounts actually in the possession of Buyer
pursuant to clause (C) of this subsection, and (ii) any
proceeds from the sale of Purchased Assets applied to the
Repurchase Price pursuant to subsection (a)(iv) of this
Section; and
(C) all Income actually received by the Buyer
pursuant to Section 5 (excluding any Late Payment Fees paid
pursuant to Section 5(a)) shall be applied to the aggregate
unpaid Repurchase Price owed by the Seller.
(iii) Upon the occurrence of one or more Events of Default,
the Buyer shall have the right to obtain physical possession of all
files of the Seller relating to the Purchased Assets and the
Repurchase Assets and all documents relating to the Purchased Assets
which are then or may thereafter come in to the possession of the
Seller or any third party acting for the Seller and the Seller shall
deliver to the Buyer such assignments as the Buyer shall request. The
Buyer shall be entitled to specific performance of all agreements of
the Seller contained in the Facility Documents.
(iv) At any time on the Business Day following notice to the
Seller (which notice may be the notice given under subsection (a)(i)
of this Section), in the event the Seller has not repurchased all
Purchased Assets, the Buyer may (A) immediately sell, without demand
or further notice of any kind, at a public or private sale and at
such price or prices as the Buyer may deem satisfactory any or all
Purchased Assets and the Repurchase Assets subject to a such
Transactions hereunder and apply the proceeds thereof to the
aggregate unpaid Repurchase Prices and any other amounts owing by the
Seller hereunder or (B) in its sole discretion elect, in lieu of
selling all or a portion of such Purchased Assets, to give the Seller
credit for such Purchased Assets and the Repurchase Assets in an
amount equal to the Market Value of the Purchased Assets against the
aggregate unpaid Repurchase Price and any other amounts owing by the
Seller hereunder. The proceeds of any disposition of Purchased Assets
and the Repurchase Assets shall be applied as determined by Buyer in
its sole discretion.
(v) The Seller shall be liable to Buyer for (i) the amount
of all reasonable legal or other expenses (including, without
limitation, all costs and expenses of Buyer in connection with the
enforcement of this Repurchase Agreement or any other agreement
evidencing a Transaction, whether in action, suit or litigation or
bankruptcy, insolvency or other similar proceeding affecting
creditors' rights generally, further including, without limitation,
the reasonable fees and expenses of counsel (including the costs of
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internal counsel of Buyer) incurred in connection with or as a result
of an Event of Default, (ii) damages in an amount equal to the cost
(including all fees, expenses and commissions) of entering into
replacement transactions and entering into or terminating hedge
transactions in connection with or as a result of an Event of
Default, and (iii) any other loss, damage, cost or expense directly
arising or resulting from the occurrence of an Event of Default in
respect of a Transaction.
(vi) The Buyer shall have, in addition to its rights
hereunder, any rights otherwise available to it under any other
agreement or applicable law.
(vii) Buyer shall have the right to direct all servicers
then servicing any Purchased Assets to remit all collections thereon
to Buyer, and if any such payments are received by Seller, Seller
shall not commingle the amounts received with other funds of Seller
and shall promptly pay them over to Buyer. Buyer shall also have the
right to terminate any one or all of the servicers then servicing any
Purchased Assets with or without cause. In addition, Buyer shall have
the right to immediately sell the Purchased Assets and liquidate all
Repurchase Assets. Such disposition of Purchased Assets may be, at
Buyer's option, on either a servicing-released or a
servicing-retained basis. Buyer shall not be required to give any
warranties as to the Purchased Assets with respect to any such
disposition thereof. Buyer may specifically disclaim or modify any
warranties of title or the like relating to the Purchased Assets. The
foregoing procedure for disposition of the Purchased Assets and
liquidation of the Repurchase Assets shall not be considered to
adversely affect the commercial reasonableness of any sale thereof.
Seller agrees that it would not be commercially unreasonable for
Buyer to dispose of the Purchased Assets or the Repurchase Assets or
any portion thereof by using Internet sites that provide for the
auction of assets similar to the Purchased Assets or the Repurchase
Assets, or that have the reasonable capability of doing so, or that
match buyers and sellers of assets. Buyer shall be entitled to place
the Purchased Assets in a pool for issuance of mortgage-backed
securities at the then-prevailing price for such securities and to
sell such securities for such prevailing price in the open market.
Buyer shall also be entitled to sell any or all of such Purchased
Assets individually for the prevailing price.
(b) The Buyer may exercise one or more of the remedies available
hereunder immediately upon the occurrence of an Event of Default and at any
time thereafter without notice to the Seller. All rights and remedies arising
under this Repurchase Agreement as amended from time to time hereunder are
cumulative and not exclusive of any other rights or remedies which Buyer may
have.
(c) The Buyer may enforce its rights and remedies hereunder without
prior judicial process or hearing, and the Seller hereby expressly waives any
defenses the Seller might otherwise have to require Buyer to enforce its
rights by judicial process. The Seller also waives any defense (other than a
defense of payment or performance) the Seller might otherwise have arising
from the use of nonjudicial process, enforcement and sale of all or any
portion of the Repurchase Assets, or from any other election of remedies. The
Seller recognizes that nonjudicial remedies are consistent with the usages of
the trade, are responsive to commercial necessity and are the result of a
bargain at arm's length.
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(d) To the extent permitted by applicable law, the Seller shall be
liable to the Buyer for interest on any amounts owing by the Seller hereunder,
from the date the Seller becomes liable for such amounts hereunder until such
amounts are (i) paid in full by the Seller or (ii) satisfied in full by the
exercise of the Buyer's rights hereunder. Interest on any sum payable by the
Seller to the Buyer under this paragraph 14(d) shall be at a rate equal to the
Post-Default Rate.
SECTION 15. INDEMNIFICATION AND EXPENSES; RECOURSE
(a) The Seller agrees to hold the Buyer, and its Affiliates and their
officers, directors, employees, agents and advisors (each an "Indemnified
Party") harmless from and indemnify any Indemnified Party against all
liabilities, losses, damages, judgments, costs and expenses of any kind which
may be imposed on, incurred by or asserted against such Indemnified Party
(collectively, "Costs"), relating to or arising out of this Repurchase
Agreement, any other Facility Document or any transaction contemplated hereby
or thereby, or any amendment, supplement or modification of, or any waiver or
consent under or in respect of, this Repurchase Agreement, any other Facility
Document or any transaction contemplated hereby or thereby, that, in each
case, results from anything other than (A) the Indemnified Party's gross
negligence or willful misconduct or (B) attributable solely to Buyer's
ownership of any Purchased Asset following exercise of its rights to take
control of such Purchased Asset under this Agreement. Without limiting the
generality of the foregoing, the Seller agrees to hold any Indemnified Party
harmless from and indemnify such Indemnified Party against all Costs with
respect to all Eligible Assets relating to or arising out of any taxes
incurred or assessed in connection with the ownership of the Eligible Assets,
that, in each case, results from anything other than the Indemnified Party's
gross negligence or willful misconduct. In any suit, proceeding or action
brought by an Indemnified Party in connection with any Eligible Asset for any
sum owing thereunder, or to enforce any provisions of any Eligible Asset, the
Seller will save, indemnify and hold such Indemnified Party harmless from and
against all expense, loss or damage suffered by reason of any defense, set
off, counterclaim, recoupment or reduction or liability whatsoever of the
account debtor or obligor thereunder, arising out of a breach by the Seller of
any obligation thereunder or arising out of any other agreement, indebtedness
or liability at any time owing to or in favor of such account debtor or
obligor or its successors from the Seller. The Seller also agrees to reimburse
an Indemnified Party as and when billed by such Indemnified Party for all the
Indemnified Party's costs and expenses incurred in connection with the
enforcement or the preservation of the Buyer's rights under this Repurchase
Agreement, any other Facility Document or any transaction contemplated hereby
or thereby, including without limitation the reasonable fees and disbursements
of its counsel.
(b) The Seller agrees to pay as and when billed by the Buyer all of
the out-of-pocket costs and expenses incurred by the Buyer in connection with
the development, preparation and execution of, and any amendment, supplement
or modification to, this Repurchase Agreement, any other Facility Document or
any other documents prepared in connection herewith or therewith. The Seller
agrees to pay as and when billed by the Buyer all of the reasonable
out-of-pocket costs and expenses incurred in connection with the consummation
of the transactions contemplated hereby and thereby including without
limitation filing fees and all the reasonable fees, disbursements and expenses
of counsel to the Buyer which amount shall be deducted from the Purchase Price
paid for the first Transaction hereunder.
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Subject to the limitations set forth in Section 17 hereof, the Seller agrees
to pay the Buyer all the reasonable out of pocket due diligence, inspection,
testing and review costs and expenses incurred by the Buyer with respect to
Eligible Assets submitted by the Seller for purchase under this Repurchase
Agreement, including, but not limited to, those out of pocket costs and
expenses incurred by the Buyer pursuant to Sections 15(b) and 17 hereof.
(c) The obligations of the Seller from time to time to pay the
Repurchase Price, the Periodic Advance Repurchase Payments, and all other
amounts due under this Repurchase Agreement shall be full recourse obligations
of the Seller.
SECTION 16. SERVICING
(a) Seller and Buyer shall contract with Servicer to service the
Purchased Assets pursuant to the Servicing Agreement, consistent with the
degree of skill and care that Servicer customarily requires with respect to
similar Purchased Assets owned or managed by it and in accordance with
Accepted Servicing Practices. The Servicing Agreement shall require, inter
alia, that: Servicer (i) comply with all applicable federal, state and local
laws and regulations, (ii) maintain all state and federal licenses necessary
for it to perform its servicing responsibilities hereunder and (iii) not
impair the rights of Buyer in any Purchased Assets or any payment thereunder.
In addition, the Servicing Agreement shall require that the Servicer deposit
all collections of Income (other than amounts deposited in escrow accounts
pursuant to the Servicing Agreement) received by Servicer on account of the
Purchased Assets in the Collection Account no later than two Business Days
following receipt.
(b) Upon the occurrence of any of (i) a Default or Event of Default
hereunder or (ii) an event of default under the Servicing Agreement, Buyer
shall have the right to immediately terminate the Servicer's right to service
the Purchased Assets without payment of any penalty or termination fee. Seller
and Servicer shall cooperate in transferring the servicing of the Purchased
Assets to a successor servicer appointed by Buyer in its sole discretion.
(c) If Seller should discover that, for any reason whatsoever,
Servicer or any entity responsible for managing or servicing any Purchased
Assets has failed to perform in all material respects any of the obligations
of such entities with respect to the Purchased Assets, or that an event of
default under the Servicing Agreement has occurred, Seller shall promptly
notify Buyer.
(d) In the event that the Servicer is a master servicer of a
Purchased Asset which is serviced by a Third Party Servicer, the Seller shall
provide promptly to Buyer a Servicer Notice addressed to and agreed to by the
Third Party Servicer of the related Purchased Assets, advising such Third
Party Servicer of such matters as Buyer may reasonably request, including,
without limitation, recognition by the master servicer of Buyer's interest in
such Purchased Assets and the Third Party Servicer's agreement that upon
receipt of notice of an Event of Default from Buyer, it will follow the
instructions of Buyer with respect to the Purchased Assets and any related
Income with respect thereto.
(e) Seller shall not employ sub-servicers (other than the Servicer or
Affiliates thereof or Third Party Servicers) to service the Purchased Assets
without the prior written
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approval of Buyer, which such approval shall not be unreasonably withheld. If
the Purchased Assets are serviced, in whole or in part, by a sub-servicer (i)
Servicer shall nevertheless remain primarily liable to Buyer for the servicing
of the Purchased Assets under the Servicing Agreement; and (ii) any agreement
with a subservicer shall entitle Buyer to terminate such subservicer without
fee or penalty in the event that Servicer is replaced.
SECTION 17. DUE DILIGENCE
(a) The Seller acknowledges that Buyer has the right to perform
continuing due diligence reviews with respect to the Eligible Assets and the
Seller, for purposes of verifying compliance with the representations,
warranties and specifications made hereunder, or otherwise, and each of the
Seller agrees that upon reasonable prior notice unless an Event of Default
shall have occurred, in which case no notice is required, to the Seller, Buyer
or its authorized representatives will be permitted during normal business
hours to examine, inspect, and make copies and extracts of, the Asset Files
and any and all documents, records, agreements, instruments or information
relating to such Eligible Assets in the possession or under the control of the
Seller and/or the Custodian. The Seller also shall make available to Buyer a
knowledgeable financial or accounting officer for the purpose of answering
questions respecting the Asset Files and the Eligible Assets. Without limiting
the generality of the foregoing, the Seller acknowledges that Buyer may
purchase Eligible Assets from the Seller based solely upon the information
provided by the Seller to Buyer in the Purchased Asset Schedule and the
representations, warranties and covenants contained herein, and that Buyer, at
its option, has the right at any time to conduct a partial or complete due
diligence review on some or all of the Eligible Assets purchased in a
Transaction, including, without limitation, ordering broker's price opinions,
new credit reports and new appraisals on the related Mortgaged Properties or
Underlying Properties and otherwise re-generating the information used to
originate such Eligible Asset. Buyer may underwrite such Eligible Assets
itself or engage a mutually agreed upon third party underwriter to perform
such underwriting. The Seller agrees to cooperate with Buyer and any third
party underwriter in connection with such underwriting, including, but not
limited to, providing Buyer and any third party underwriter with access to any
and all documents, records, agreements, instruments or information relating to
such Eligible Assets in the possession, or under the control, of the Seller.
The Seller further agrees that the Seller shall pay all out-of-pocket costs
and expenses incurred by Buyer in connection with Buyer's activities pursuant
to this Section 17 ("Due Diligence Costs").
SECTION 18. ASSIGNABILITY
The rights and obligations of the parties under this Repurchase
Agreement and under any Transaction shall not be assigned by the Seller
without the prior written consent of Buyer. Subject to the foregoing, this
Repurchase Agreement and any Transactions shall be binding upon and shall
inure to the benefit of the parties and their respective successors and
assigns. Nothing in this Repurchase Agreement express or implied, shall give
to any Person, other than the parties to this Repurchase Agreement and their
successors hereunder, any benefit of any legal or equitable right, power,
remedy or claim under this Repurchase Agreement. Buyer may from time to time
assign all or a portion of its rights and obligations under this Repurchase
Agreement and the Facility Documents; pursuant to an executed assignment and
acceptance by Buyer and assignee ("Assignment and Acceptance"), specifying the
percentage or portion of
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such rights and obligations assigned. Upon such assignment, (a) such assignee
shall be a party hereto and to each Facility Document to the extent of the
percentage or portion set forth in the Assignment and Acceptance, and shall
succeed to the applicable rights and obligations of Buyer hereunder, and (b)
Buyer shall, to the extent that such rights and obligations have been so
assigned by it be released from its obligations hereunder and under the
Facility Documents. Unless otherwise stated in the Assignment and Acceptance,
the Seller shall continue to take directions solely from Buyer unless
otherwise notified by Buyer in writing. Buyer may distribute to any
prospective assignee any document or other information delivered to Buyer by
Seller.
The Buyer may sell participations to one or more Persons in or to all
or a portion of its rights and obligations under this Repurchase Agreement;
provided, however, that (i) the Buyer's obligations under this Repurchase
Agreement shall remain unchanged, (ii) the Buyer shall remain solely
responsible to the other parties hereto for the performance of such
obligations; and (iii) the Seller shall continue to deal solely and directly
with the Buyer in connection with the Buyer's rights and obligations under
this Repurchase Agreement and the other Facility Documents except as provided
in Section 7.
The Buyer may, in connection with any assignment or participation or
proposed assignment or participation pursuant to this Section 18, disclose to
the assignee or participant or proposed assignee or participant, as the case
may be, any information relating to the Seller or any of its Subsidiaries or
to any aspect of the Transactions that has been furnished to the Buyer by or
on behalf of the Seller or any of its Subsidiaries; provided that such
assignee or participant agrees to hold such information subject to the
confidentiality provisions of this Repurchase Agreement.
In the event the Buyer assigns all or a portion of its rights and
obligations under this Repurchase Agreement, the parties hereto agree to
negotiate in good faith an amendment to this Repurchase Agreement to add
agency provisions similar to those included in repurchase agreements for
similar syndicated repurchase facilities.
SECTION 19. TRANSFER AND MAINTENANCE OF REGISTER.
(a) Subject to acceptance and recording thereof pursuant to paragraph
(b) of this Section 19, from and after the effective date specified in each
Assignment and Acceptance the assignee thereunder shall be a party hereto and,
to the extent of the interest assigned by such Assignment and Acceptance, have
the rights and obligations of the Buyer under this Repurchase Agreement. Any
assignment or transfer by the Buyer of rights or obligations under this
Repurchase Agreement that does not comply with this Section 19 shall be
treated for purposes of this Repurchase Agreement as a sale by such Buyer of a
participation in such rights and obligations in accordance with Section 19(b)
hereof.
(b) The Seller shall maintain a register (the "Register") on which it
will record the Buyer's rights hereunder, and each Assignment and Acceptance
and participation. The Register shall include the names and addresses of the
Buyer (including all assignees, successors and participants) and the
percentage or portion of such rights and obligations assigned. Failure to make
any such recordation, or any error in such recordation shall not affect the
Seller's
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obligations in respect of such rights. If the Buyer sells a participation in
its rights hereunder, it shall provide Seller, or maintain as agent of Seller,
the information described in this paragraph and permit Seller to review such
information as reasonably needed for Seller to comply with its obligations
under this Repurchase Agreement or under any applicable Requirement of Law.
SECTION 20. HYPOTHECATION OR PLEDGE OF PURCHASED ASSETS
Title to all Purchased Assets and Repurchase Assets shall pass to
Buyer and Buyer shall have free and unrestricted use of all Purchased Assets.
Nothing in this Repurchase Agreement shall preclude the Buyer from engaging in
repurchase transactions with the Purchased Assets or otherwise pledging,
repledging, transferring, hypothecating, or rehypothecating the Purchased
Assets. Nothing contained in this Repurchase Agreement shall obligate the
Buyer to segregate any Purchased Assets delivered to the Buyer by the Seller.
SECTION 21. TAX TREATMENT
Each party to this Repurchase Agreement acknowledges that it is its
intent for purposes of U.S. federal, state and local income and franchise
taxes, to treat each Transaction as indebtedness of the Seller that is secured
by the Purchased Assets and that the Purchased Assets are owned by the Seller
in the absence of a Default by the Seller. All parties to this Repurchase
Agreement agree to such treatment and agree to take no action inconsistent
with this treatment, unless required by law.
SECTION 22. SET-OFF
In addition to any rights and remedies of the Buyer hereunder and by
law, the Buyer shall have the right, without prior notice to the Seller, any
such notice being expressly waived by the Seller to the extent permitted by
applicable law to set-off and appropriate and apply against any Obligation
from Seller or any Affiliate thereof to Buyer or any of its Affiliates any and
all deposits (general or special, time or demand, provisional or final), in
any currency, and any other obligation (including to return excess margin),
credits, indebtedness or claims, in any currency, in each case whether direct
or indirect, absolute or contingent, matured or unmatured, at any time held or
owing by or due from the Buyer or any Affiliate thereof to or for the credit
or the account of the Seller or any Affiliate thereof. The Buyer agrees
promptly to notify the Seller after any such set off and application made by
the Buyer; provided that the failure to give such notice shall not affect the
validity of such set off and application.
The Buyer shall at any time have the right, in each case until such
time as the Buyer determines otherwise, to retain, to suspend payment or
performance of, or to decline to remit, any amount or property that the Buyer
would otherwise be obligated to pay, remit or deliver to Seller hereunder if
an Event of Default or Default has occurred with respect to the Seller.
SECTION 23. TERMINABILITY
Each representation and warranty made or deemed to be made by
entering into a Transaction, herein or pursuant hereto shall survive the
making of such representation and warranty, and the Buyer shall not be deemed
to have waived any Default that may arise because
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any such representation or warranty shall have proved to be false or
misleading, notwithstanding that the Buyer may have had notice or knowledge or
reason to believe that such representation or warranty was false or misleading
at the time the Transaction was made. Notwithstanding any such termination or
the occurrence of an Event of Default, all of the representations and
warranties and covenants hereunder shall continue and survive. The obligations
of the Seller under Section 15 hereof shall survive the termination of this
Repurchase Agreement.
SECTION 24. NOTICES AND OTHER COMMUNICATIONS
Except as otherwise expressly permitted by this Repurchase Agreement,
all notices, requests and other communications provided for herein (including
without limitation any modifications of, or waivers, requests or consents
under, this Repurchase Agreement) shall be given or made in writing (including
without limitation by telecopy) delivered to the intended recipient at the
"Address for Notices" specified below its name on the signature pages hereof
or thereof); or, as to any party, at such other address as shall be designated
by such party in a written notice to each other party. Except as otherwise
provided in this Repurchase Agreement and except for notices given under
Section 3 (which shall be effective only on receipt), all such communications
shall be deemed to have been duly given when transmitted by telecopy if given
before 5:00 p.m. recipient local time on a Business Day, and otherwise, on the
next Business Day or personally delivered or, in the case of a mailed notice,
upon receipt, in each case given or addressed as aforesaid.
SECTION 25. ENTIRE AGREEMENT; SEVERABILITY; SINGLE AGREEMENT
This Repurchase Agreement, together with the Facility Documents,
constitute the entire understanding between Buyer and the Seller with respect
to the subject matter they cover and shall supersede any existing agreements
between the parties containing general terms and conditions for repurchase
transactions involving Purchased Assets. By acceptance of this Repurchase
Agreement, Buyer and the Seller acknowledge that they have not made, and are
not relying upon, any statements, representations, promises or undertakings
not contained in this Repurchase Agreement. Each provision and agreement
herein shall be treated as separate and independent from any other provision
or agreement herein and shall be enforceable notwithstanding the
unenforceability of any such other provision or agreement.
Buyer and Seller acknowledge that, and have entered hereinto and will
enter into each Transaction hereunder in consideration of and in reliance upon
the fact that, all Transactions hereunder constitute a single business and
contractual relationship and that each has been entered into in consideration
of the other Transactions. Accordingly, each of Buyer and Seller agrees (i) to
perform all of its obligations in respect of each Transaction hereunder, and
that a default in the performance of any such obligations shall constitute a
default by it in respect of all Transactions hereunder, (ii) that each of them
shall be entitled to set off claims and apply property held by them in respect
of any Transaction against obligations owing to them in respect of any other
Transaction hereunder; (iii) that payments, deliveries, and other transfers
made by either of them in respect of any Transaction shall be deemed to have
been made in consideration of payments, deliveries, and other transfers in
respect of any other Transactions hereunder, and the obligations to make any
such payments, deliveries, and other transfers may be applied against
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each other and netted and (iv) to promptly provide notice to the other after
any such set off or application.
SECTION 26. GOVERNING LAW
THIS REPURCHASE AGREEMENT SHALL BE GOVERNED BY THE INTERNAL LAWS OF
THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO THE CONFLICT OF LAW PRINCIPLES
THEREOF.
SECTION 27. SUBMISSION TO JURISDICTION; WAIVERS
EACH OF BUYER AND SELLER HEREBY IRREVOCABLY AND UNCONDITIONALLY:
(i) SUBMITS FOR ITSELF AND ITS PROPERTY IN ANY LEGAL ACTION
OR PROCEEDING RELATING TO THIS REPURCHASE AGREEMENT AND THE OTHER
FACILITY DOCUMENTS, OR FOR RECOGNITION AND ENFORCEMENT OF ANY
JUDGMENT IN RESPECT THEREOF, TO THE EXCLUSIVE GENERAL JURISDICTION OF
THE COURTS OF THE STATE OF NEW YORK, THE FEDERAL COURTS OF THE UNITED
STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK, AND
APPELLATE COURTS FROM ANY THEREOF;
(ii) CONSENTS THAT ANY SUCH ACTION OR PROCEEDING MAY BE
BROUGHT IN SUCH COURTS AND, TO THE EXTENT PERMITTED BY LAW, WAIVES
ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY
SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH ACTION OR
PROCEEDING WAS BROUGHT IN AN INCONVENIENT COURT AND AGREES NOT TO
PLEAD OR CLAIM THE SAME;
(iii) AGREES THAT SERVICE OF PROCESS IN ANY SUCH ACTION OR
PROCEEDING MAY BE EFFECTED BY MAILING A COPY THEREOF BY REGISTERED OR
CERTIFIED MAIL (OR ANY SUBSTANTIALLY SIMILAR FORM OF MAIL), POSTAGE
PREPAID, TO ITS ADDRESS SET FORTH UNDER ITS SIGNATURE BELOW OR AT
SUCH OTHER ADDRESS OF WHICH THE BUYER SHALL HAVE BEEN NOTIFIED; AND
(iv) AGREES THAT NOTHING HEREIN SHALL AFFECT THE RIGHT TO
EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR
SHALL LIMIT THE RIGHT TO ▇▇▇ IN ANY OTHER JURISDICTION.
(v) THE BUYER AND THE SELLER HEREBY IRREVOCABLY WAIVE, TO
THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO
TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO
THIS REPURCHASE AGREEMENT,
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ANY OTHER FACILITY DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY
OR THEREBY.
SECTION 28. NO WAIVERS, ETC.
No failure on the part of the Buyer to exercise and no delay in
exercising, and no course of dealing with respect to, any right, power or
privilege under any Facility Document shall operate as a waiver thereof, nor
shall any single or partial exercise of any right, power or privilege under
any Facility Document preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. The remedies provided herein
are cumulative and not exclusive of any remedies provided by law. An Event of
Default shall be deemed to be continuing unless expressly waived by the Buyer
in writing.
SECTION 29. NETTING
If the Buyer and the Seller are "financial institutions" as now or
hereinafter defined in Section 4402 of Title 12 of the United States Code
("Section 4402") and any rules or regulations promulgated thereunder,
(a) All amounts to be paid or advanced by one party to or on behalf
of the other under this Repurchase Agreement or any Transaction hereunder
shall be deemed to be "payment obligations" and all amounts to be received by
or on behalf of one party from the other under this Repurchase Agreement or
any Transaction hereunder shall be deemed to be "payment entitlements" within
the meaning of Section 4402, and this Repurchase Agreement shall be deemed to
be a "netting contract" as defined in Section 4402.
(b) The payment obligations and the payment entitlements of the
parties hereto pursuant to this Repurchase Agreement and any Transaction
hereunder shall be netted as follows. In the event that either party (the
"Defaulting Party") shall fail to honor any payment obligation under this
Repurchase Agreement or any Transaction hereunder, the other party (the
"Nondefaulting Party") shall be entitled to reduce the amount of any payment
to be made by the Nondefaulting Party to the Defaulting Party by the amount of
the payment obligation that the Defaulting Party failed to honor.
SECTION 30. CONFIDENTIALITY
The Buyer and the Seller hereby acknowledge and agree that all
written or computer-readable information provided by one party to any other
regarding the terms set forth in any of the Facility Documents or the
Transactions contemplated thereby (the "Confidential Terms") shall be kept
confidential and shall not be divulged to any party without the prior written
consent of such other party except to the extent that (i) it is necessary to
do so in working with legal counsel, auditors, taxing authorities or other
governmental agencies or regulatory bodies or in order to comply with any
applicable federal or state laws including disclosures required by federal
securities regulations, (ii) any of the Confidential Terms are in the public
domain other than due to a breach of this covenant, (iii) in the event of an
Event of Default the Buyer determines such information to be necessary or
desirable to disclose in connection with the marketing and sales of the
Purchased Assets or otherwise to enforce or exercise the Buyer's rights
hereunder or (iv) in the event of a legal dispute, to the extent necessary to
be disclosed as
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an evidentiary matter. Notwithstanding the foregoing or
anything to the contrary contained herein or in any other Facility Document,
the parties hereto may disclose to any and all Persons, without limitation of
any kind, the federal, state and local tax treatment of the Transactions, any
fact relevant to understanding the federal, state and local tax treatment of
the Transactions, and all materials of any kind (including opinions or other
tax analyses) relating to such federal, state and local tax treatment and that
may be relevant to understanding such tax treatment; provided that Seller may
not disclose the name of or identifying information with respect to Buyer or
any pricing terms (including, without limitation, the Pricing Rate, Commitment
Fee, Purchase Price Percentage and Purchase Price) or other nonpublic business
or financial information (including any sublimits and financial covenants)
that is unrelated to the federal, state and local tax treatment of the
Transactions and is not relevant to understanding the federal, state and local
tax treatment of the Transactions, without the prior written consent of the
Buyer. The provisions set forth in this Section 30 shall survive the
termination of this Repurchase Agreement.
SECTION 31. INTENT
(a) The parties recognize that each Transaction is a "repurchase
agreement" as that term is defined in Section 101 of Title 11 of the United
States Code, as amended (except insofar as the type of Eligible Assets subject
to such Transaction or the term of such Transaction would render such
definition inapplicable), and a "securities contract" as that term is defined
in Section 741 of Title 11 of the United States Code, as amended (except
insofar as the type of assets subject to such Transaction would render such
definition inapplicable) and that all payments hereunder are deemed "margin
payments" or "settlement payments" as defined in Title 11 of the USC.
(b) It is understood that either party's right to liquidate Eligible
Assets delivered to it in connection with Transactions hereunder or to
exercise any other remedies pursuant to Section 14 hereof is a contractual
right to liquidate such Transaction as described in Sections 555 and 559 of
Title 11 of the United States Code, as amended.
(c) The parties agree and acknowledge that if a party hereto is an
"insured depository institution," as such term is defined in the Federal
Deposit Insurance Act, as amended ("FDIA"), then each Transaction hereunder is
a "qualified financial contract," as that term is defined in FDIA and any
rules, orders or policy statements thereunder (except insofar as the type of
assets subject to such Transaction would render such definition inapplicable).
(d) It is understood that this Repurchase Agreement constitutes a
"netting contract" as defined in and subject to Title IV of the Federal
Deposit Insurance Corporation Improvement Act of 1991 ("FDICIA") and each
payment entitlement and payment obligation under any Transaction hereunder
shall constitute a "covered contractual payment entitlement" or "covered
contractual payment obligation", respectively, as defined in and subject to
FDICIA (except insofar as one or both of the parties is not a "financial
institution" as that term is defined in FDICIA).
(e) This Repurchase Agreement is intended to be a "repurchase
agreement" and a "securities contract," within the meaning of Section 555 and
Section 559 under the Bankruptcy Code.
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SECTION 32. DISCLOSURE RELATING TO CERTAIN FEDERAL PROTECTIONS
The parties acknowledge that they have been advised that:
(a) in the case of Transactions in which one of the parties is a
broker or dealer registered with the Securities and Exchange Commission
("SEC") under Section 15 of the Securities Exchange Act of 1934 ("1934 Act"),
the Securities Investor Protection Corporation has taken the position that the
provisions of the Securities Investor Protection Act of 1970 ("SIPA") do not
protect the other party with respect to any Transaction hereunder;
(b) in the case of Transactions in which one of the parties is a
government securities broker or a government securities dealer registered with
the SEC under Section 15C of the 1934 Act, SIPA will not provide protection to
the other party with respect to any Transaction hereunder; and
(c) in the case of Transactions in which one of the parties is a
financial institution, funds held by the financial institution pursuant to a
Transaction hereunder are not a deposit and therefore are not insured by the
Federal Deposit Insurance Corporation or the National Credit Union Share
Insurance Fund, as applicable.
SECTION 33. AUTHORIZATIONS
Any of the persons whose signatures and titles appear on Schedule 4
are authorized, acting singly, to act for the Seller or Buyer, as the case may
be, under this Repurchase Agreement.
SECTION 34. RESERVED
SECTION 35. MISCELLANEOUS
(a) Counterparts. This Repurchase Agreement may be executed in any
number of counterparts, all of which taken together shall constitute one and
the same instrument, and any of the parties hereto may execute this Repurchase
Agreement by signing any such counterpart.
(b) Captions. The captions and headings appearing herein are for
included solely for convenience of reference and are not intended to affect
the interpretation of any provision of this Repurchase Agreement.
(c) Acknowledgment. The Seller hereby acknowledges that:
(i) it has been advised by counsel in the negotiation,
execution and delivery of this Repurchase Agreement and the other
Facility Documents;
(ii) the Buyer has no fiduciary relationship to the Seller;
and
(iii) no joint venture exists between the Buyer and the
Seller.
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(d) Documents Mutually Drafted. The Seller and the Buyer agree that
this Repurchase Agreement each other Facility Document prepared in connection
with the Transactions set forth herein have been mutually drafted and
negotiated by each party, and consequently such documents shall not be
construed against either party as the drafter thereof.
SECTION 36. GENERAL INTERPRETIVE PRINCIPLES
For purposes of this Repurchase Agreement, except as otherwise
expressly provided or unless the context otherwise requires:
(a) the terms defined in this Repurchase Agreement have the meanings
assigned to them in this Repurchase Agreement and include the plural as well
as the singular, and the use of any gender herein shall be deemed to include
the other gender;
(b) accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles;
(c) references herein to "Articles", "Sections", "Subsections",
"Paragraphs", and other subdivisions without reference to a document are to
designated Articles, Sections, Subsections, Paragraphs and other subdivisions
of this Repurchase Agreement;
(d) a reference to a Subsection without further reference to a
Section is a reference to such Subsection as contained in the same Section in
which the reference appears, and this rule shall also apply to Paragraphs and
other subdivisions;
(e) the words "herein", "hereof", "hereunder" and other words of
similar import refer to this Repurchase Agreement as a whole and not to any
particular provision;
(f) the term "include" or "including" shall mean without limitation
by reason of enumeration;
(g) all times specified herein or in any other Facility Document
(unless expressly specified otherwise) are local times in New York, New York
unless otherwise stated; and
(h) all references herein or in any Facility Document to "good faith"
means good faith as defined in Section 1-201(19) of the UCC as in effect in
the State of New York.
[THIS SPACE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties have entered into this Repurchase
Agreement as of the date set forth above.
BUYER:
▇▇▇▇▇▇ COMMERCIAL PAPER INC.,
By:_________________________________
Name:_______________________________
Title:______________________________
Address for Notices:
▇▇▇▇▇▇ Commercial Paper, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇
Telecopier No.: 212.526.4625
Telephone No.: ▇▇▇.▇▇▇.▇▇▇▇
SELLER:
ANTHRACITE CAPITAL, INC.
By:_________________________________
Name:
Title:
Address for Notices:
Anthracite Capital, Inc.
c/o Blackrock Financial Management, Inc.
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇
Telecopier No.: 212.810.8758
Telephone No: ▇▇▇.▇▇▇.▇▇▇▇
with a copy to:
c/o Blackrock Financial Management, Inc.
One PNC Plaza, 19th Floor
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telecopier No.: 412.762.4546
Telephone No.: ▇▇▇.▇▇▇.▇▇▇▇
SCHEDULE 1
REPRESENTATIONS AND WARRANTIES
RE: PURCHASED ASSETS CONSISTING OF COMMERCIAL MORTGAGE LOANS
Seller represents and warrants to Buyer, with respect to each
Purchased Asset which is a Commercial Mortgage Loan, that except as
specifically disclosed to and approved by Buyer in accordance with the
Repurchase Agreement, as of the Purchase Date for each such Purchased Asset by
Buyer from Seller and as of the date of each Transaction hereunder and at all
times while the Facility Documents or any Transaction hereunder is in full
force and effect the representations set forth on this Schedule 1(a) shall be
true and correct in all material respects. For purposes of this Schedule 1(a)
and the representations and warranties set forth herein, a breach of a
representation or warranty shall be deemed to have been cured with respect to
a Purchased Asset which is a Commercial Mortgage Loan if and when Seller has
taken or caused to be taken action such that the event, circumstance or
condition that gave rise to such breach no longer affects such Purchased
Asset.
1. The Commercial Mortgage Loan is a performing mortgage loan secured by a
first priority security interest in a commercial or multifamily property.
2. Such Commercial Mortgage Loan complies in all material respects with, or is
exempt from, all requirements of federal, state or local law relating to such
Commercial Mortgage Loan.
3. Immediately prior to the sale, transfer and assignment to Buyer thereof,
Seller had good and marketable title to, and was the sole owner and holder of,
such Commercial Mortgage Loan, and Seller is transferring such Commercial
Mortgage Loan free and clear of any and all liens, pledges, encumbrances,
charges, security interests or any other ownership interests of any nature
encumbering such Commercial Mortgage Loan. Upon consummation of the purchase
contemplated to occur in respect of such Commercial Mortgage Loan on the
Purchase Date therefor, Seller will have validly and effectively conveyed to
Buyer all legal and beneficial interest in and to such Commercial Mortgage
Loan free and clear of any pledge, lien, encumbrance or security interest.
4. No fraudulent acts were committed by Seller in connection with its
acquisition or origination of such Commercial Mortgage Loan nor were any
fraudulent acts committed by any Person in connection with the origination of
such Commercial Mortgage Loan.
5. All information contained in the related Asset File, Closing Data Tape and
Purchased Asset Schedule (or as otherwise provided to Buyer) in respect of
such Commercial Mortgage Loan is accurate and complete in all material
respects.
6. Except as included in the related Asset File, Closing Data Tape and
Purchased Asset Schedule, Seller is not a party to any document, instrument or
agreement, and there is no document, that by its terms modifies or affects the
rights and obligations of any holder of such Commercial Mortgage Loan and
Seller has not consented to any material change or waiver to
Schedule 1(a)-1
any term or provision of any such document, instrument or agreement and no
such change or waiver exists.
7. Such Commercial Mortgage Loan is presently outstanding, the proceeds
thereof have been fully and properly disbursed and, except for amounts held in
escrow by Servicer, there is no requirement for any future advances
thereunder.
8. Seller has full right, power and authority to sell and assign such
Commercial Mortgage Loan and such Commercial Mortgage Loan or any related
Mortgage Note has not been cancelled, satisfied or rescinded in whole or part
nor has any instrument been executed that would effect a cancellation,
satisfaction or rescission thereof.
9. Other than consents and approvals obtained as of the related Purchase Date
or those already granted in the related Mortgage and/or Mortgage Note, no
consent or approval by any Person is required in connection with Seller's sale
and/or Buyer's acquisition of such Commercial Mortgage Loan, for Buyer's
exercise of any rights or remedies in respect of such Commercial Mortgage Loan
or for Buyer's sale, pledge or other disposition of such Commercial Mortgage
Loan. No third party holds any "right of first refusal", "right of first
negotiation", "right of first offer", purchase option, or other similar rights
of any kind, and no other impediment exists to any such transfer or exercise
of rights or remedies.
10. No consent, approval, authorization or order of, or registration or filing
with, or notice to, any court or governmental agency or body having
jurisdiction or regulatory authority is required for any transfer or
assignment by the holder of such Commercial Mortgage Loan.
11. Seller has not received written notice of any outstanding liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind for which the holder of such Commercial
Mortgage Loan is or may become obligated which could reasonably be expected to
materially and adversely affect such Mortgagor's ability to pay principal,
interest or any other amounts due under such Commercial Mortgage Loan or the
security intended to be provided by the Commercial Mortgage Loan documents or
the current use of the Underlying Mortgaged Property.
12. Seller has not advanced funds, or knowingly received any advance of funds
from a party other than the mortgagee relating to such Commercial Mortgage
Loan, directly or indirectly, for the payment of any amount required by such
Commercial Mortgage Loan.
13. Each related Mortgage Note, Mortgage, Assignment of Leases (if a document
separate from the Mortgage) and other agreement executed by the related
Mortgagor in connection with such Commercial Mortgage Loan is a legal, valid
and binding obligation of the related Mortgagor (subject to any non-recourse
provisions therein and any state anti-deficiency or market value limit
deficiency legislation), enforceable in accordance with its terms, except (i)
that certain provisions contained in such Commercial Mortgage Loan documents
are or may be unenforceable in whole or in part under applicable state or
federal laws, but neither the application of any such laws to any such
provision nor the inclusion of any such provisions renders any of the
Commercial Mortgage Loan documents invalid as a whole and such Commercial
Mortgage Loan documents taken as a whole are enforceable to the extent
necessary
Schedule 1(a)-2
and customary for the practical realization of the rights and benefits
afforded thereby and (ii) as such enforcement may be limited by bankruptcy,
insolvency, receivership, reorganization, moratorium, redemption, liquidation
or other laws relating to or affecting the enforcement of creditors' rights
generally, or by general principles of equity (regardless of whether such
enforcement is considered in a proceeding in equity or at law). The related
Mortgage Note and Mortgage contain no provision limiting the right or ability
of Seller to assign, transfer and convey the related Commercial Mortgage Loan
to any other Person, except, however, for customary intercreditor restrictions
limiting assignees to "qualified transferees". With respect to any Underlying
Mortgaged Property that has tenants, there exists as either part of the
Mortgage or as a separate document, an assignment of leases.
14. There is no offset, defense, counterclaim, abatement or right to
rescission with respect to any related Mortgage Note, Mortgage or other
agreements executed in connection therewith.
15. Seller has delivered to Buyer or its designee the original Mortgage
Note(s) made in respect of such Commercial Mortgage Loan, together with an
original endorsement thereof executed by [Seller] in blank and the related
Asset File.
16. Each related Assignment of Mortgage and assignment of Assignment of Leases
from [Seller] in blank constitutes the legal, valid and binding first priority
assignment from [Seller] (assuming the insertion of the Buyer's name), except
as such enforcement may be limited by bankruptcy, insolvency, receivership,
reorganization, moratorium, redemption, liquidation or other laws relating to
or affecting the enforcement of creditors' rights generally, or by general
principles of equity (regardless of whether such enforcement is considered in
a proceeding in equity or at law). Each Mortgage and Assignment of Leases is
freely assignable.
17. The Commercial Mortgage Loan is secured by one or more Mortgages and each
such Mortgage is a valid and enforceable first lien on the related Underlying
Mortgaged Property subject only to the exceptions set forth in paragraph (13)
above and the following title exceptions (each such title exception, a "Title
Exception", and collectively, the "Title Exceptions"): (a) the lien of current
real property taxes, water charges, sewer rents and assessments not yet due
and payable, (b) covenants, conditions and restrictions, rights of way,
easements and other matters of public record, none of which, individually or
in the aggregate, materially and adversely interferes with the current use of
the Underlying Mortgaged Property or the security intended to be provided by
such Mortgage or with the Mortgagor's ability to pay its obligations under the
Commercial Mortgage Loan when they become due or materially and adversely
affects the value of the Underlying Mortgaged Property, (c) the exceptions
(general and specific) and exclusions set forth in the applicable policy
described in paragraph (21) below or appearing of record, none of which,
individually or in the aggregate, materially and adversely interferes with the
current use of the Underlying Mortgaged Property or the security intended to
be provided by such Mortgage or with the Mortgagor's ability to pay its
obligations under the Commercial Mortgage Loan when they become due or
materially and adversely affects the value of the Underlying Mortgaged
Property, (d) other matters to which like properties are commonly subject,
none of which, individually or in the aggregate, materially and adversely
interferes with the current use of the Underlying
Schedule 1(a)-3
Mortgaged Property or the security intended to be provided by such Mortgage or
with the Mortgagor's ability to pay its obligations under the Commercial
Mortgage Loan when they become due or materially and adversely affects the
value of the Underlying Mortgaged Property, (e) the right of tenants (whether
under ground leases, space leases or operating leases) at the Underlying
Mortgaged Property to remain following a foreclosure or similar proceeding
(provided that such tenants are performing under such leases) and (f) if such
Commercial Mortgage Loan is cross-collateralized with any other Commercial
Mortgage Loan, the lien of the Mortgage for such other Commercial Mortgage
Loan, none of which, individually or in the aggregate, materially and
adversely interferes with the current use of the Underlying Mortgaged Property
or the security intended to be provided by such Mortgage or with the
Mortgagor's ability to pay its obligations under the Commercial Mortgage Loan
when they become due or materially and adversely affects the value of the
Underlying Mortgaged Property. Except with respect to cross-collateralized and
cross-defaulted Commercial Mortgage Loans and as provided below, there are no
mortgage loans that are senior or pari passu with respect to the related
Underlying Mortgaged Property or such Commercial Mortgage Loan.
18. UCC Financing Statements have been filed and/or recorded (or, if not filed
and/or recorded, have been submitted in proper form for filing and recording),
in all public places necessary to perfect a valid security interest in all
items of personal property located on the Underlying Mortgaged Property that
are owned by the Mortgagor and either (i) are reasonably necessary to operate
the Underlying Mortgaged Property or (ii) are (as indicated in the appraisal
obtained in connection with the origination of the related Commercial Mortgage
Loan) material to the value of the Underlying Mortgaged Property (other than
any personal property subject to a purchase money security interest or a sale
and leaseback financing arrangement permitted under the terms of such
Commercial Mortgage Loan or any other personal property leases applicable to
such personal property), to the extent perfection may be effected pursuant to
applicable law by recording or filing, and the Mortgages, security agreements,
chattel Mortgages or equivalent documents related to and delivered in
connection with the related Commercial Mortgage Loan establish and create a
valid and enforceable lien and priority security interest on such items of
personalty except as such enforcement may be limited by bankruptcy,
insolvency, receivership, reorganization, moratorium, redemption, liquidation
or other laws relating to or affecting the enforcement of creditor's rights
generally, or by general principles of equity (regardless of whether such
enforcement is considered in a proceeding in equity or at law).
19. All real estate taxes and governmental assessments, or installments
thereof, which would be a lien on the Underlying Mortgaged Property and that
have become delinquent in respect of the Underlying Mortgaged Property have
been paid, or an escrow of funds in an amount sufficient to cover such
payments has been established. For purposes of this representation and
warranty, real estate taxes and governmental assessments and installments
thereof shall not be considered delinquent until the earlier of (a) the date
on which interest and/or penalties would first be payable thereon and (b) the
date on which enforcement action is entitled to be taken by the related taxing
authority.
20. To Seller's actual knowledge after due inquiry, the related Underlying
Mortgaged Property is free and clear of any material damage (other than
deferred maintenance for which escrows were established at origination) that
would affect materially and adversely the value of such Underlying Mortgaged
Property as security for the Commercial Mortgage Loan and there is no
proceeding pending or threatened for the total or partial condemnation of such
Underlying Mortgaged Property.
Schedule 1(a)-4
21. The lien of each related Mortgage as a first priority lien in the original
principal amount of such Commercial Mortgage Loan after all advances of
principal is insured by an ALTA lender's title insurance policy (or a binding
commitment therefor), or its equivalent as adopted in the applicable
jurisdiction, insuring the original mortgagee, its successors and assigns,
subject only to the Title Exceptions; the mortgagee or its successors or
assigns is the sole named insured of such policy; such policy is assignable
without consent of the insurer and will inure to the benefit of the mortgagee
of record; such title policy is in full force and effect upon the consummation
of the transactions contemplated by this Repurchase Agreement; all premiums
thereon have been paid; no claims have been made under such policy and no
circumstance exists which would impair or diminish the coverage of such
policy. The insurer issuing such policy is (x) a nationally recognized title
insurance company and (y) qualified to do business in the jurisdiction in
which the related Underlying Mortgaged Property is located to the extent
required; such policy contains no material exclusions for, or affirmatively
insures (except for any Underlying Mortgaged Property located in a
jurisdiction where such insurance is not available) (a) access to public road
or (b) against any loss due to encroachments of any material portion of the
improvements thereon.
22. All insurance coverage required under each related Mortgage, which
insurance covered such risks as were customarily acceptable to prudent
commercial and multifamily mortgage lending institutions lending on the
security of property comparable to the related Underlying Mortgaged Property
in the jurisdiction in which such Underlying Mortgaged Property is located,
and with respect to a fire and extended perils insurance policy, is in an
amount (subject to a customary deductible) at least equal to the lesser of (i)
the replacement cost of improvements located on such Underlying Mortgaged
Property, or (ii) the outstanding principal balance of the Commercial Mortgage
Loan, and in any event, the amount necessary to prevent operation of any
co-insurance provisions; and is also covered by business interruption or
rental loss insurance, in an amount at least equal to 12 months of operations
of the related Underlying Mortgaged Property, all of which was in full force
and effect with respect to the related Underlying Mortgaged Property; and all
insurance coverage required under each Mortgage, which insurance covers such
risks and is in such amounts as are customarily acceptable to prudent
commercial and multifamily mortgage lending institutions lending on the
security of property comparable to the related Underlying Mortgaged Property
in the jurisdiction in which such Underlying Mortgaged Property is located, is
in full force and effect with respect to the related Underlying Mortgaged
Property; all premiums due and payable have been paid; and no notice of
termination or cancellation with respect to any such insurance policy has been
received by Seller; and except for certain amounts not greater than amounts
which would be considered prudent by an institutional commercial and/or
multifamily mortgage lender with respect to a similar Commercial Mortgage Loan
and which are set forth in the related Mortgage, any insurance proceeds in
respect of a casualty loss, will be applied either (i) to the repair or
restoration of all or part of the related Underlying Mortgaged Property or
(ii) the reduction of the outstanding principal balance of the Commercial
Mortgage Loan, subject in either case to requirements with respect to leases
at the related Underlying Mortgaged Property and to other exceptions
customarily provided for by prudent institutional lenders for similar loans.
The Underlying Mortgaged Property is also covered by comprehensive general
liability insurance against claims for personal and bodily injury, death or
property damage occurring on, in or about the related Underlying Mortgaged
Property, in an amount customarily required by prudent institutional lenders.
An architectural or engineering consultant has performed an analysis of the
Underlying
Schedule 1(a)-5
Mortgaged Properties located in seismic zone 3 or 4 in order to evaluate the
structural and seismic condition of such property, for the sole purpose of
assessing the probable maximum loss ("PML") for the Underlying Mortgaged
Property in the event of an earthquake. In such instance, the PML was based on
a 475 year lookback with a 10% probability of exceedance in a 50 year period.
If the resulting report concluded that the PML would exceed 20% of the amount
of the replacement costs of the improvements, earthquake insurance on such
Underlying Mortgaged Property was obtained by an insurer rated at least A-:V
by A.M. Best Company or "BBB-" (or the equivalent) from S&P and Fitch or
"Baa3" (or the equivalent) from ▇▇▇▇▇'▇. If the Underlying Mortgaged Property
is located in Florida or within 25 miles of the coast of Texas, Louisiana,
Mississippi, Alabama, Georgia, North Carolina or South Carolina such
Underlying Mortgaged Property is insured by windstorm insurance in an amount
at least equal to the lesser of (i) the outstanding principal balance of such
Commercial Mortgage Loan and (ii) 100% of the full insurable value, or 100% of
the replacement cost, of the improvements located on the related Underlying
Mortgaged Property.
The insurance policies contain a standard mortgagee clause naming
Seller, its successors and assigns as loss payee, in the case of a property
insurance policy, and additional insured in the case of a liability insurance
policy and provide that they are not terminable without 30 days prior written
notice to the mortgagee (or, with respect to non-payment, 10 days prior
written notice to the mortgagee) or such lesser period as prescribed by
applicable law. Each Mortgage requires that the Mortgagor maintain insurance
as described above or permits the mortgagee to require insurance as described
above, and permits the mortgagee to purchase such insurance at the Mortgagor's
expense if Mortgagor fails to do so.
23. (a) Other than payments due but not yet 30 days or more delinquent, there
is no material default, breach, violation or event of acceleration existing
under the related Mortgage or the related Mortgage Note, and no event has
occurred (other than payments due but not yet delinquent) which, with the
passage of time or with notice and the expiration of any grace or cure period,
would constitute a material default, breach, violation or event of
acceleration, and (b) Seller has not waived any material default, breach,
violation or event of acceleration under such Mortgage or Mortgage Note and
pursuant to the terms of the related Mortgage or the related Mortgage Note and
other documents in the related Mortgage Loan documents no Person or party
other than the holder of such Mortgage Note may declare any event of default
or accelerate the related indebtedness under either of such Mortgage or
Mortgage Note.
24. Such Commercial Mortgage Loan is not, since origination, and has not been,
30 days or more past due in respect of any scheduled payment or part thereof.
25. Each related Mortgage does not provide for or permit, without the prior
written consent of the holder of the Mortgage Note, the related Underlying
Mortgaged Property to secure any other promissory note or obligation except as
expressly described in such Mortgage.
26. Such Commercial Mortgage Loan constitutes a "qualified mortgage" within
the meaning of Section 860G(a)(3)of the Code (without regard to Treasury
Regulations Sections 1.860G-2(a)(3) or 1.860G-2(f)(2)), is directly secured by
a Mortgage on a commercial property or a multifamily residential property, and
either (1) substantially all of the proceeds of such Commercial Mortgage Loan
were used to acquire, improve or protect the portion of such
Schedule 1(a)-6
commercial or multifamily residential property that consists of an interest in
real property (within the meaning of Treasury Regulations Sections 1.856-3(c)
and 1.856-3(d)) and such interest in real property was the only security for
such Commercial Mortgage Loan as of the Testing Date (as defined below), or
(2) the fair market value of the interest in real property which secures such
Commercial Mortgage Loan was at least equal to 80% of the principal amount of
the Commercial Mortgage Loan (a) as of the Testing Date, or (b) as of the
Purchase Date. For purposes of the previous sentence, (1) the fair market
value of the referenced interest in real property shall first be reduced by
(a) the amount of any lien on such interest in real property that is senior to
the Commercial Mortgage Loan, and (b) a proportionate amount of any lien on
such interest in real property that is on a parity with the Commercial
Mortgage Loan, and (2) the "Testing Date" shall be the date on which the
referenced Commercial Mortgage Loan was originated unless (a) such Commercial
Mortgage Loan was modified after the date of its origination in a manner that
would cause a "significant modification" of such Commercial Mortgage Loan
within the meaning of Treasury Regulations Section 1.1001-3(b), and (b) such
"significant modification" did not occur at a time when such Commercial
Mortgage Loan was in default or when default with respect to such Commercial
Mortgage Loan was reasonably foreseeable. However, if the referenced
Commercial Mortgage Loan has been subjected to a "significant modification"
after the date of its origination and at a time when such Commercial Mortgage
Loan was not in default or when default with respect to such Commercial
Mortgage Loan was not reasonably foreseeable, the Testing Date shall be the
date upon which the latest such "significant modification" occurred.
27. There is no material and adverse environmental condition or circumstance
affecting the Underlying Mortgaged Property; there is no material violation of
any applicable Environmental Law with respect to the Underlying Mortgaged
Property; neither Seller nor the owner of the Underlying Mortgaged Property
has taken any actions which would cause the Underlying Mortgaged Property not
to be in compliance with all applicable Environmental Laws; the Underlying
Mortgage Loan documents require the Mortgagor to comply with all Environmental
Laws; and each Mortgagor has agreed to indemnify the mortgagee for any losses
resulting from any material, adverse environmental condition or failure of the
Mortgagor to abide by such Environmental Laws or has provided environmental
insurance.
28. Each related Mortgage and Assignment of Leases, together with applicable
state law, contains customary and enforceable provisions for comparable
mortgaged properties similarly situated such as to render the rights and
remedies of the holder thereof adequate for the practical realization against
the Underlying Mortgaged Property of the benefits of the security, including
realization by judicial or, if applicable, non-judicial foreclosure, subject
to the effects of bankruptcy, insolvency, receivership, reorganization,
moratorium, redemption, liquidation or other laws relating to or affecting the
enforcement of creditors' rights generally, or by general principles of equity
(regardless of whether such enforcement is considered in a proceeding in
equity or at law).
29. No Mortgagor is a debtor in any state or federal bankruptcy or insolvency
proceeding.
30. Such Commercial Mortgage Loan is a whole loan and contains no equity
participation by the lender or shared appreciation feature and does not
provide for any contingent or additional interest in the form of participation
in the cash flow of the related Underlying Mortgaged
Schedule 1(a)-7
Property or provide for negative amortization. Seller holds no preferred
equity interest in such Commercial Mortgage Loan.
31. Subject to certain exceptions, which are customarily acceptable to prudent
commercial and multifamily mortgage lending institutions lending on the
security of property comparable to the related Underlying Mortgaged Property,
each related Mortgage or loan agreement contains provisions for the
acceleration of the payment of the unpaid principal balance of such Commercial
Mortgage Loan if, without complying with the requirements of the Mortgage or
loan agreement, (a) the related Underlying Mortgaged Property, or any
controlling interest in the related Mortgagor, is directly transferred or sold
(other than by reason of family and estate planning transfers, transfers by
devise, descent or operation of law upon the death of a member, general
partner or shareholder of the related borrower and transfers of less than a
controlling interest (as such term is defined in the related Commercial
Mortgage Loan documents) in a mortgagor, issuance of non-controlling new
equity interests, transfers among existing members, partners or shareholders
in the Mortgagor or an affiliate thereof, transfers among affiliated
Mortgagors with respect to Commercial Mortgage Loans which are
cross-collateralized or cross-defaulted with other mortgage loans or
multi-property Commercial Mortgage Loans or transfers of a similar nature to
the foregoing meeting the requirements of the Commercial Mortgage Loan (such
as pledges of ownership interests that do not result in a change of control)
or a substitution or release of collateral within the parameters of paragraph
(34) below), or (b) the related Underlying Mortgaged Property or controlling
interest in the Mortgagor is encumbered in connection with subordinate
financing by a lien or security interest against the related Underlying
Mortgaged Property, other than any existing permitted additional debt. The
Commercial Mortgage Loan documents require the Mortgagor to pay all reasonable
costs incurred by the Mortgagor with respect to any transfer, assumption or
encumbrance requiring lender's approval.
32. Except as set forth in the related Asset File, Closing Data Tape and
Purchased Asset Schedule, the terms of the related Mortgage Note(s) and
Mortgage(s) have not been waived, modified, altered, satisfied, impaired,
canceled, subordinated or rescinded in any manner which materially interferes
with the security intended to be provided by such Mortgage and no such waiver,
modification, alteration, satisfaction, impairment, cancellation,
subordination or rescission has occurred since the date upon which the Asset
File, Closing Data Tape and Purchased Asset Schedule for such Commercial
Mortgage Loan was delivered to Buyer or its designee.
33. Each related Underlying Mortgaged Property was inspected by or on behalf
of the related originator or an affiliate during the 12 month period prior to
the related origination date.
34. No material portion of the related Underlying Mortgaged Property has been
released from the lien of the related Mortgage in any manner which materially
and adversely affects the value of the Commercial Mortgage Loan or materially
interferes with the security intended to be provided by such Mortgage, and,
except with respect to Commercial Mortgage Loans (a) which permit defeasance
by means of substituting for the Underlying Mortgaged Property (or, in the
case of a Commercial Mortgage Loan secured by multiple Underlying Mortgaged
Properties, one or more of such Underlying Mortgaged Properties) "government
securities" as defined in the Investment Company Act of 1940, as amended,
sufficient to pay the Commercial Mortgage
Schedule 1(a)-8
Loans (or portions thereof) in accordance with its terms, (b) where a release
of the portion of the Underlying Mortgaged Property was contemplated at
origination and such portion was not considered material for purposes of
underwriting the Commercial Mortgage Loan, (c) where release is conditional
upon the satisfaction of certain underwriting and legal requirements and the
payment of a release price that represents adequate consideration for such
Underlying Mortgaged Property or the portion thereof that is being released,
(d) which permit the related Mortgagor to substitute a replacement property in
compliance with REMIC Provisions or (e) which permit the release(s) of
unimproved out-parcels or other portions of the Underlying Mortgaged Property
that will not have a material adverse effect on the underwritten value of the
security for the Commercial Mortgage Loan or that were not allocated to any
value in the underwriting during the origination of the Commercial Mortgage
Loan, the terms of the related Mortgage do not provide for release of any
portion of the Underlying Mortgaged Property from the lien of the Mortgage
except in consideration of payment in full therefor.
35. There are no material violations of any applicable zoning ordinances,
building codes or land laws applicable to the Underlying Mortgaged Property or
the use and occupancy thereof which (i) are not insured by an ALTA lender's
title insurance policy, or its equivalent as adopted in the applicable
jurisdiction, or a law and ordinance insurance policy or (ii) would have a
material adverse effect on the value, operation or net operating income of the
Underlying Mortgaged Property. The Commercial Mortgage Loan documents require
the Underlying Mortgaged Property to comply with all applicable laws and
ordinances.
36. None of the material improvements which were included for the purposes of
determining the appraised value of the related Underlying Mortgaged Property
at the time of the origination of the Commercial Mortgage Loan lies outside of
the boundaries and building restriction lines of such property (except
Underlying Mortgaged Properties which are legal non-conforming uses), to an
extent which would have a material adverse affect on the value of the
Underlying Mortgaged Property or related Mortgagor's use and operation of such
Underlying Mortgaged Property (unless affirmatively covered by title
insurance) and no improvements on adjoining properties encroached upon such
Underlying Mortgaged Property to any material and adverse extent (unless
affirmatively covered by title insurance).
37. The related Mortgagor has covenanted in its organizational documents
and/or the Commercial Mortgage Loan documents to own no significant asset
other than the related Underlying Mortgaged Properties, as applicable, and
assets incidental to its ownership and operation of such Underlying Mortgaged
Properties, and to hold itself out as being a legal entity, separate and apart
from any other Person.
38. No advance of funds has been made other than pursuant to the loan
documents, directly or indirectly, by the mortgagee, the Seller or the
Servicer to the Mortgagor and no funds have been received from any Person
other than the Mortgagor, for or on account of payments due on the Mortgage
Note or the Mortgage.
39. There is no pending action, suit or proceeding, or governmental
investigation of which mortgagee, Seller or Servicer has received notice,
against the Mortgagor or the related Underlying Mortgaged Property the adverse
outcome of which could reasonably be expected to materially and adversely
affect such Mortgagor's ability to pay principal, interest or any other
Schedule 1(a)-9
amounts due under such Commercial Mortgage Loan or the security intended to be
provided by the Commercial Mortgage Loan documents or the current use of the
Underlying Mortgaged Property.
40. If the related Mortgage is a deed of trust, a trustee, duly qualified
under applicable law to serve as such, has either been properly designated and
serving under such Mortgage or may be substituted in accordance with the
Mortgage and applicable law.
41. The Commercial Mortgage Loan and the interest (exclusive of any default
interest, late charges or prepayment premiums) contracted for complied as of
the date of origination with, or is exempt from, applicable state or federal
laws, regulations and other requirements pertaining to usury.
42. Each Commercial Mortgage Loan that is cross-collateralized is
cross-collateralized only with other Commercial Mortgage Loans sold pursuant
to this Repurchase Agreement.
43. The improvements located on the Underlying Mortgaged Property are either
not located in a federally designated special flood hazard area or, if so
located, the Mortgagor is required to maintain or the mortgagee maintains,
flood insurance with respect to such improvements and such policy is in full
force and effect in an amount no less than the lesser of (i) the original
principal balance of the Commercial Mortgage Loan, (ii) the value of such
improvements on the related Underlying Mortgaged Property located in such
flood hazard area or (iii) the maximum allowed under the related federal flood
insurance program.
44. All escrow deposits and payments required pursuant to the Commercial
Mortgage Loan required to be deposited with the Servicer in accordance with
the Commercial Mortgage Loan documents have been so deposited, are in the
possession, or under the control, of Servicer or its agent and there are no
deficiencies in connection therewith.
45. The related Mortgagor, the related lessee, franchisor or operator is in
possession of all material licenses, permits and authorizations then required
for use of the related Underlying Mortgaged Property by the related Mortgagor.
The Commercial Mortgage Loan documents require the Mortgagor, the related
lessee, franchisor or operator to maintain all such licenses, permits and
authorizations.
46. The origination (or acquisition, as the case may be), servicing and
collection practices used by mortgagee and servicer with respect to the
Commercial Mortgage Loan have been in all respects legal (to Seller's
knowledge after due inquiry) and have met customary industry standards for
servicing of commercial mortgage loans for conduit loan programs.
47. Except for Mortgagors under Commercial Mortgage Loans the Underlying
Mortgaged Property with respect to which includes a Ground Lease, the related
Mortgagor (or its affiliate) has title in the fee simple interest in each
related Underlying Mortgaged Property.
48. The Commercial Mortgage Loan documents for such Commercial Mortgage Loan
provide that such Commercial Mortgage Loan is non-recourse to the related
Mortgagor except that the related Mortgagor and an additional guarantor
accepts responsibility for any loss incurred due to fraud on the part of the
Mortgagor and/or other intentional material
Schedule 1(a)-10
misrepresentation. Furthermore, the Commercial Mortgage Loan documents for
each Commercial Mortgage Loan provide that the related Mortgagor and an
additional guarantor shall be liable to the lender for losses incurred due to
the misapplication or misappropriation of rents collected in advance or
received by the related Mortgagor after the occurrence of an event of default
and not paid to the mortgagee or applied to the Underlying Mortgaged Property
in the ordinary course of business, misapplication or conversion by the
Mortgagor of insurance proceeds or condemnation awards or breach of the
environmental covenants in the related Commercial Mortgage Loan documents.
49. Subject to the exceptions set forth in paragraph (13) and upon possession
of the Underlying Mortgaged Property as required under applicable state law,
any Assignment of Leases set forth in the Mortgage or separate from the
related Mortgage and related to and delivered in connection with such
Commercial Mortgage Loan establishes and creates a valid, subsisting and
enforceable lien and security interest in the related Mortgagor's interest in
all leases, subleases, licenses or other agreements pursuant to which any
Person is entitled to occupy, use or possess all or any portion of the real
property.
50. With respect to such Commercial Mortgage Loan, any prepayment premium and
yield maintenance charge constitutes a "customary prepayment penalty" within
the meaning of Treasury Regulations Section 1.860G-1(b)(2).
51. If such Commercial Mortgage Loan contains a provision for any defeasance
of mortgage collateral, such Commercial Mortgage Loan permits defeasance (1)
no earlier than two years after any securitization of such Commercial Mortgage
Loan and (2) only with substitute collateral constituting "government
securities" within the meaning of Treasury Regulations Section
1.860G-2(a)(8)(i) in an amount sufficient to make all scheduled payments under
the Mortgage Note. Such Commercial Mortgage Loan was not originated with the
intent to collateralize a REMIC offering with obligations that are not real
estate mortgages. In addition, if such Mortgage contains such a defeasance
provision, it provides (or otherwise contains provisions pursuant to which the
holder can require) that an opinion be provided to the effect that such holder
has a first priority perfected security interest in the defeasance collateral.
The related Commercial Mortgage Loan documents permit the lender to charge all
of its expenses associated with a defeasance to the Mortgagor (including
rating agencies' fees, accounting fees and attorneys' fees), and provide that
the related Mortgagor must deliver (or otherwise, the Commercial Mortgage Loan
documents contain certain provisions pursuant to which the lender can require)
(a) an accountant's certification as to the adequacy of the defeasance
collateral to make payments under the related Commercial Mortgage Loan for the
remainder of its term, (b) an opinion of counsel that the defeasance complies
with all applicable REMIC Provisions, and (c) assurances from each applicable
Rating Agency that the defeasance will not result in the withdrawal, downgrade
or qualification of the ratings assigned to any certificates backed by the
related Commercial Mortgage Loan.
52. The originator of such Commercial Mortgage Loan was authorized to do
business in the jurisdiction in which the related Underlying Mortgaged
Property is located at all times when it originated and held the Commercial
Mortgage Loan.
Schedule 1(a)-11
53. Neither Seller nor any affiliate thereof has any obligation to make any
capital contributions to the Mortgagor under the Commercial Mortgage Loan.
54. The related Underlying Mortgaged Property is not encumbered, and none of
the Commercial Mortgage Loan documents permits the related Underlying
Mortgaged Property to be encumbered without the prior written consent of the
holder of such Commercial Mortgage Loan, by any lien securing the payment of
money junior to or of equal priority with, or superior to, the lien of the
related Mortgage.
55. Each related Underlying Mortgaged Property constitutes one or more
complete separate tax lots (or the related Mortgagor has covenanted to obtain
separate tax lots and a Person has indemnified the mortgagee for any loss
suffered in connection therewith or an escrow of funds in an amount sufficient
to pay taxes resulting from a breach thereof has been established) or is
subject to an endorsement under the related title insurance policy.
56. An appraisal of the related Underlying Mortgaged Property was conducted
within 12 months of the origination of the Commercial Mortgage Loan, which
appraisal is signed by a qualified appraiser who had no interest, direct or
indirect, in the Underlying Mortgaged Property or in any loan made on the
security thereof; and whose compensation is not affected by the approval or
disapproval of the Mortgage Loan, and such appraisal and appraiser both
satisfied either (A) the requirements of the "Uniform Standards of
Professional Appraisal Practice" as adopted by the Appraisal Standards Board
of the Appraisal Foundation, or (B) the guidelines in Title XI of the
Financial Institutions Reform, Recovery and Enforcement Act or 1989, in either
case as in effect on the date such Commercial Mortgage Loan was originated.
57. The related Commercial Mortgage Loan documents require the Mortgagor to
provide the mortgagee with certain financial information at the times required
under the related Commercial Mortgage Loan documents.
58. The related Underlying Mortgaged Property is served by public utilities,
water and sewer (or septic facilities) and otherwise appropriate for the use
in which the Underlying Mortgaged Property is currently being utilized.
59. Each Underlying Mortgaged Property is free and clear of any and all
mechanics' and materialmen's liens that are prior or equal to the lien of the
related Mortgage, and no rights are outstanding that under law could give rise
to any such lien that would be prior or equal to the lien of the related
Mortgage except, in each case, for liens insured against by the title policy
referred to herein or otherwise bonded at least 125% of the lien liability.
60. Reserved.
61. Each Commercial Mortgage Loan has a Loan-to-Value Ratio of 90% or less.
62. With respect to each related Underlying Mortgaged Property consisting of a
Ground Lease, Seller represents and warrants the following with respect to the
related Ground Lease:
(ii) Such Ground Lease or a memorandum thereof has been or will be duly
recorded no later than 30 days after the origination date and such Ground
Lease permits the interest of the lessee
Schedule 1(a)-12
thereunder to be encumbered by the related Mortgage or, if consent of the
lessor thereunder is required, it has been obtained prior to the origination
date.
(iii) Upon the foreclosure of the Commercial Mortgage Loan (or acceptance of a
deed in lieu thereof), the Mortgagor's interest in such Ground Lease is
assignable to the mortgagee under the leasehold estate and its assigns without
the consent of the lessor thereunder (or, if any such consent is required, it
has been obtained prior to the Purchase Date).
(iv) Such Ground Lease may not be amended, modified, canceled or terminated
without the prior written consent of the mortgagee and any such action without
such consent is not binding on the mortgagee, its successors or assigns,
except termination or cancellation if (i) an event of default occurs under the
Ground Lease, (ii) notice thereof is provided to the mortgagee and (iii) such
default is curable by the mortgagee as provided in the Ground Lease but
remains uncured beyond the applicable cure period.
(v) To Seller's knowledge after due inquiry, Such Ground Lease is in full
force and effect, there is no material default under such Ground Lease, and
there is no event which, with the passage of time or with notice and the
expiration of any grace or cure period, would constitute a material default
under such Ground Lease.
(vi) The Ground Lease or ancillary agreement between the lessor and the lessee
requires the lessor to give notice of any default by the lessee to the
mortgagee. The Ground Lease or ancillary agreement further provides that no
notice given is effective against the mortgagee unless a copy has been given
to the mortgagee in a manner described in the Ground Lease or ancillary
agreement.
(vii) The Ground Lease (i) is not subject to any liens or encumbrances
superior to, or of equal priority with, the Mortgage, subject, however, to
only the Title Exceptions or (ii) is subject to a subordination,
non-disturbance and attornment agreement to which the mortgagee on the
lessor's fee interest in the Underlying Mortgaged Property is subject.
(viii) A mortgagee is permitted a reasonable opportunity (including, where
necessary, sufficient time to gain possession of the interest of the lessee
under the Ground Lease) to cure any curable default under such Ground Lease
before the lessor thereunder may terminate such Ground Lease.
(ix) Such Ground Lease has an original term (together with any extension
options, whether or not currently exercised, set forth therein all of which
can be exercised by the mortgagee if the mortgagee acquires the lessee's
rights under the Ground Lease) that extends not less than 20 years beyond the
stated maturity date of the Mortgage.
(x) Under the terms of such Ground Lease, any estoppel or consent letter
received by the mortgagee from the lessor, and the related Mortgage, taken
together, any related insurance proceeds or condemnation award (other than in
respect of a total or substantially total loss or taking) will be applied
either to the repair or restoration of all or part of the related Underlying
Mortgaged Property, with the mortgagee or a trustee appointed by it having the
right to hold and disburse such proceeds as repair or restoration progresses,
or to the payment or defeasance of the outstanding principal balance of the
Commercial Mortgage Loan, together with any accrued
Schedule 1(a)-13
interest (except in cases where a different allocation would not be viewed as
commercially unreasonable by any commercial mortgage lender, taking into
account the relative duration of the Ground Lease and the related Mortgage and
the ratio of the market value of the related Underlying Mortgaged Property to
the outstanding principal balance of such Commercial Mortgage Loan).
(xi) The Ground Lease does not impose any restrictions on subletting that
would be viewed as commercially unreasonable by a prudent commercial lender.
(xii) The ground lessor under such Ground Lease is required to enter into a
new lease upon termination of the Ground Lease for any reason, including the
rejection of the Ground Lease in bankruptcy.
63. The Mortgagor under such Mortgage Loan is not an Affiliate of the Seller.
64. Except as disclosed in the summary information delivered to the Buyer, no
Purchased Asset has been acquired by an Affiliate other than a direct parent
of the Seller.
Schedule 1(a)-14
Schedule 1(b)
REPRESENTATIONS AND WARRANTIES
RE: PURCHASED ASSETS CONSISTING OF JUNIOR INTERESTS
Seller represents and warrants to Buyer, with respect to each
Purchased Asset which is a Junior Interest, that except as specifically
disclosed to and approved by Buyer in accordance with the Repurchase
Agreement, as of the Purchase Date for each such Purchased Asset by Buyer from
Seller and as of the date of each Transaction hereunder and at all times while
the Facility Documents or any Transaction hereunder is in full force and
effect the representations set forth on this Schedule 1(b) shall be true and
correct in all material respects. For purposes of this Schedule 1(b) and the
representations and warranties set forth herein, a breach of a representation
or warranty shall be deemed to have been cured with respect to a Purchased
Asset which is a Junior Interest if and when Seller has taken or caused to be
taken action such that the event, circumstance or condition that gave rise to
such breach no longer affects such Purchased Asset.
1. With respect to each Underlying Mortgage Loan and Underlying Mortgaged
Property related to each Junior Interest, the representations and warranties
set forth on Schedule 1(a) are true and correct in all material respects.
2. The Junior Interest is (a) a junior participation interest in a Commercial
Mortgage Loan or a Mezzanine Loan or (b) a "B-note" in an "A/B structure" in a
Commercial Mortgage Loan or a Mezzanine Loan.
3. Each Junior Interest has a Loan-to-Value Ratio of 90% or less.
4. Seller has delivered to Buyer or its designee the original promissory note,
certificate or other similar indicia of ownership of such Junior Interest,
however denominated, together with an original assignment thereof, executed by
Seller in blank, or, with respect to a participation interest, reissued in
Buyer's name (or such other name as designated by the Buyer).
5. No default or event of default has occurred under any agreement pertaining
to any lien or other interest that ranks pari passu with or senior to the
interests of the holder of such Junior Interest in respect of the related
Underlying Mortgaged Property and there is no provision in any such agreement
which would provide for any increase in the principal amount of any such lien
or other interest.
6. To Seller's knowledge after due inquiry, no (i) monetary default, breach or
violation exists with respect to any agreement or other document governing or
pertaining to such Junior Interest, the related Commercial Mortgage Loan, the
related Mezzanine Loan or any other obligation of the owner of the Underlying
Mortgaged Property, (ii) material non-monetary default, breach or violation
exists with respect to such Junior Interest, the related Commercial Mortgage
Loan, the related Mezzanine Loan or any other obligation of the owner of the
Underlying Mortgaged Property, or (iii) event which, with the passage of time
or with notice and
Schedule 1(b)-1
the expiration of any grace or cure period, would constitute a default,
breach, violation or event of acceleration.
7. Such Junior Interest has not been and shall not be deemed to be a Security
within the meaning of the Securities Act of 1933, as amended or the Securities
Exchange Act of 1934, as amended.
8. No issuer of the Purchased Asset, no co-participant and no Mortgagor
related to any Underlying Mortgage Loan, is a debtor in any state or federal
bankruptcy or insolvency proceeding.
9. The Mortgagor related to an Underlying Mortgage Loan is not an Affiliate of
the Seller.
10. Except as disclosed in the summary information delivered to the Buyer, no
Purchased Asset has been acquired by an Affiliate other than a direct parent
of the Seller.
Schedule 1(b)-2
Schedule 1(c)
REPRESENTATIONS AND WARRANTIES
RE: PURCHASED ASSETS CONSISTING OF MEZZANINE LOANS
Seller represents and warrants to Buyer, with respect to each
Purchased Asset which is a Mezzanine Loan, that except as specifically
disclosed to and approved by Buyer in accordance with the Repurchase
Agreement, as of the Purchase Date for each such Purchased Asset by Buyer from
Seller and as of the date of each Transaction hereunder and at all times while
the Facility Documents or any Transaction hereunder is in full force and
effect the representations set forth on this Schedule 1(c) shall be true and
correct in all material respects. For purposes of this Schedule 1(c) and the
representations and warranties set forth herein, a breach of a representation
or warranty shall be deemed to have been cured with respect to a Purchased
Asset which is a Mezzanine Loan if and when Seller has taken or caused to be
taken action such that the event, circumstance or condition that gave rise to
such breach no longer affects such Purchased Asset.
1. The Mezzanine Loan is a performing mezzanine loan secured by a pledge of
all of the Capital Stock of a Mortgagor that owns income producing commercial
real estate.
2. Such Mezzanine Loan complies in all material respects with, or is exempt
from, all requirements of federal, state or local law relating to such
Mezzanine Loan.
3. Immediately prior to the sale, transfer and assignment to Buyer thereof,
Seller had good and marketable title to, and was the sole owner and holder of,
such Mezzanine Loan, and Seller is transferring such Mezzanine Loan free and
clear of any and all liens, pledges, encumbrances, charges, security interests
or any other ownership interests of any nature encumbering such Mezzanine
Loan. Upon consummation of the purchase contemplated to occur in respect of
such Mezzanine Loan on the Purchase Date therefor, Seller will have validly
and effectively conveyed to Buyer all legal and beneficial interest in and to
such Mezzanine Loan free and clear of any pledge, lien, encumbrance or
security interest.
4. No fraudulent acts were committed by Seller in connection with its
acquisition or origination of such Mezzanine Loan nor were any fraudulent acts
committed by any Person in connection with the origination of such Mezzanine
Loan.
5. All information contained in the related Asset File, Closing Data Tape and
Purchased Asset Schedule (or as otherwise provided to Buyer) in respect of
such Mezzanine Loan is accurate and complete in all material respects.
6. Except as included in related Asset File, Closing Data Tape and Purchased
Asset Schedule, Seller is not a party to any document, instrument or
agreement, and there is no document, that by its terms modifies or affects the
rights and obligations of any holder of such Mezzanine Loan and Seller has not
consented to any material change or waiver to any term or provision of any
such document, instrument or agreement and no such change or waiver exists.
Schedule 1(c)-1
7. Such Mezzanine Loan is presently outstanding, the proceeds thereof have
been fully and properly disbursed and, except for amounts held in escrow by
Servicer, there is no requirement for any future advances thereunder.
8. Seller has full right, power and authority to sell and assign such
Mezzanine Loan and such Mezzanine Loan or any related Mezzanine Loan Document
has not been cancelled, satisfied or rescinded in whole or part nor has any
instrument been executed that would effect a cancellation, satisfaction or
rescission thereof.
9. Other than consents and approvals obtained as of the related Purchase Date
or those already granted in the Mezzanine Loan Documents, no consent or
approval by any Person is required in connection with Seller's sale and/or
Buyer's acquisition of such Mezzanine Loan, for Buyer's exercise of any rights
or remedies in respect of such Mezzanine Loan or for Buyer's sale, pledge or
other disposition of such Mezzanine Loan. No third party holds any "right of
first refusal", "right of first negotiation", "right of first offer", purchase
option, or other similar rights of any kind, and no other impediment exists to
any such transfer or exercise of rights or remedies.
10. The Mezzanine Loan is secured by a pledge of equity ownership interests in
the related Mortgagor under the Underlying Mortgage Loan or a direct or
indirect owner of the related Mortgagor and the security interest created
thereby has been fully perfected in favor of the originator and its successors
and assigns.
11. The owner of the Underlying Mortgaged Property has been duly organized and
is validly existing and in good standing under the laws of its jurisdiction of
organization, with requisite power and authority to own its assets and to
transact the business in which it is now engaged, the sole purpose of the
owner of the Underlying Mortgaged Property under its organizational documents
is to own, finance, sell or otherwise manage the Properties and to engage in
any and all activities related or incidental thereto, and the Mortgaged
Properties constitute the sole assets of the owner of the Underlying Mortgaged
Property.
12. The owner of the Underlying Mortgaged Property has good and marketable
title to the Underlying Mortgaged Property, no claims under the title policies
insuring the owner of the Underlying Mortgaged Property's title to the
Properties have been made, and the owner of the Underlying Mortgaged Property
has not received any written notice regarding any material violation of any
easement, restrictive covenant or similar instrument affecting the Underlying
Mortgaged Property.
13. To Seller's actual knowledge after due inquiry, the representations and
warranties made by the borrower (the "Mezzanine Borrower") in the Mezzanine
Loan Documents were true and correct in all material respects as of the date
such representations and warranties were stated to be true therein, and there
has been no adverse change with respect to the Mezzanine Loan, the Mezzanine
Borrower, the Underlying Mortgaged Property or the owner of the Underlying
Mortgaged Property that would render any such representation or warranty not
true or correct in any material respect as of the Purchase Date.
Schedule 1(c)-2
14. The Mezzanine Loan Documents provide for the acceleration of the payment
of the unpaid principal balance of the Mezzanine Loan if (i) the related
borrower voluntarily transfers or encumbers all or any portion of any related
Mezzanine Collateral, or (ii) any direct or indirect interest in the related
borrower is voluntarily transferred or assigned, other than, in each case, as
permitted under the terms and conditions of the related loan documents.
15. Pursuant to the terms of the Mezzanine Loan Documents: (a) no material
terms of any related Mortgage may be waived, canceled, subordinated or
modified in any material respect and no material portion of such Mortgage or
the Underlying Mortgaged Property may be released without the consent of the
holder of the Mezzanine Loan; (b) no material action may be taken by the owner
of the Underlying Mortgaged Property with respect to the Underlying Mortgaged
Property without the consent of the holder of the Mezzanine Loan; (c) the
holder of the Mezzanine Loan is entitled to approve the budget of the owner of
the Underlying Mortgaged Property as it relates to the Underlying Mortgaged
Property; and (d) the holder of the Mezzanine Loan's consent is required prior
to the owner of the Underlying Mortgaged Property incurring any additional
indebtedness.
16. There is no (i) monetary default, breach or violation with respect to such
Mezzanine Loan, the Underlying Mortgage Loan or any other obligation of the
owner of the Underlying Mortgaged Property, (ii) material non-monetary
default, breach or violation with respect to such Mezzanine Loan, the
Underlying Mortgage Loan or any other obligation of the owner of the
Underlying Mortgaged Property or (iii) event which, with the passage of time
or with notice and the expiration of any grace or cure period, would
constitute a default, breach, violation or event of acceleration.
17. To Seller's knowledge after due inquiry, no default or event of default
has occurred under any agreement pertaining to any lien or other interest that
ranks pari passu with or senior to the interests of the holder of such
Mezzanine Loan or with respect to any Underlying Mortgage Loan or other
indebtedness in respect of the related Underlying Mortgaged Property and there
is no provision in any agreement related to any such lien, interest or loan
which would provide for any increase in the principal amount of any such lien,
other interest or loan.
18. Seller's security interest in the Mezzanine Loan is covered by a UCC-9
insurance policy (the "UCC-9 Policy") in the maximum principal amount of the
Mezzanine Loan insuring that the related pledge is a valid first priority lien
on the Mezzanine Collateral, subject only to the exceptions stated therein (or
a pro forma title policy or marked up title insurance commitment on which the
required premium has been paid exists which evidences that such UCC-9 Policy
will be issued), such UCC-9 Policy (or, if it has yet to be issued, the
coverage to be provided thereby) is in full force and effect, no material
claims have been made thereunder and no claims have been paid thereunder,
Seller has not done, by act or omission, anything that would materially impair
the coverage under the UCC-9 Policy and as of the Purchase Date, the UCC-9
Policy (or, if it has yet to be issued, the coverage to be provided thereby)
will inure to the benefit of Buyer without the consent of or notice to the
insurer.
Schedule 1(c)-3
19. The Mezzanine Loan, and each party involved in the origination of the
Mezzanine Loan, complied as of the date of origination with, or was exempt
from, applicable state or federal laws, regulations and other requirements
pertaining to usury.
20. Seller has delivered to Buyer or its designee the original promissory note
made in respect of such Mezzanine Loan, together with an original assignment
thereof executed by Seller in blank.
21. The Seller has not received any written notice that the Mezzanine Loan may
be subject to reduction or disallowance for any reason, including without
limitation, any setoff, right of recoupment, defense, counterclaim or
impairment of any kind.
22. The Seller has no obligation to make loans to, make guarantees on behalf
of, or otherwise extend credit to, or make any of the foregoing for the
benefit of, the Mezzanine Borrower or any other person under or in connection
with the Mezzanine Loan.
23. The servicing and collection practices used by the servicer of the
Mezzanine Loan, and the origination practices of the related originator, have
been in all respects legal, proper and prudent and have met customary industry
standards by prudent institutional commercial mezzanine lenders and mezzanine
loan servicers except to the extent that, in connection with its origination,
such standards were modified as reflected in the documentation delivered to
Buyer.
24. If applicable, the ground lessor consented to and acknowledged that (i)
the Mezzanine Loan is permitted / approved, (ii) any foreclosure of the
Mezzanine Loan and related change in ownership of the ground lessee will not
require the consent of the ground lessor or constitute a default under the
ground lease, (iii) copies of default notices would be sent to Mezzanine
Lender and (iv) it would accept cure from Mezzanine Lender on behalf of the
ground lessee.
25. To the extent the Buyer was granted a security interest with respect to
the Mezzanine Loan, such interest (i) was given for due consideration, (ii)
has attached, (iii) is perfected, (iv) is a first priority Lien, and (v) has
been appropriately assigned to the Buyer by the owner of the Underlying
Mortgaged Property.
26. No consent, approval, authorization or order of, or registration or filing
with, or notice to, any court or governmental agency or body having
jurisdiction or regulatory authority is required for any transfer or
assignment by the holder of such Mezzanine Loan.
27. Seller has not received written notice of any outstanding liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind for which the holder of such Mezzanine
Loan is or may become obligated which could reasonably be expected to
materially and adversely affect the Mezzanine Loan or the Underlying Mortgage
Loan.
28. Seller has not advanced funds, or knowingly received any advance of funds
from a party other than the borrower relating to such Mezzanine Loan, directly
or indirectly, for the payment of any amount required by such Mezzanine Loan.
Schedule 1(c)-4
29. All real estate taxes and governmental assessments, or installments
thereof, which would be a lien on any related Underlying Mortgaged Property
and that for the related Purchased Asset have become delinquent in respect of
such Underlying Mortgaged Property have been paid, or an escrow of funds in an
amount sufficient to cover such payments has been established. For purposes of
this representation and warranty, real estate taxes and governmental
assessments and installments thereof shall not be considered delinquent until
the earlier of (a) the date on which interest and/or penalties would first be
payable thereon and (b) the date on which enforcement action is entitled to be
taken by the related taxing authority.
30. To seller's actual knowledge after due inquiry, each related Underlying
Mortgaged Property is free and clear of any material damage (other than
deferred maintenance for which escrows were established at origination) that
would affect materially and adversely the value of such Underlying Mortgaged
Property as security for the related Underlying Mortgage Loan and there is no
proceeding pending or threatened for the total or partial condemnation of such
Underlying Mortgaged Property.
31. All insurance coverage required under the Mezzanine Loan Documents and/or
any Mortgage Loan related to the Underlying Mortgaged Property, which
insurance covered such risks as were customarily acceptable to prudent
commercial and multifamily mortgage lending institutions lending on the
security of property comparable to the related Underlying Mortgaged Property
in the jurisdiction in which such Underlying Mortgaged Property is located,
and with respect to a fire and extended perils insurance policy, is in an
amount (subject to a customary deductible) at least equal to the lesser of (i)
the replacement cost of improvements located on such Underlying Mortgaged
Property, or (ii) the outstanding principal balance of the Underlying Mortgage
Loan, and in any event, the amount necessary to prevent operation of any
co-insurance provisions; and is also covered by business interruption or
rental loss insurance, in an amount at least equal to 12 months of operations
of the related Underlying Mortgaged Property, all of which was in full force
and effect with respect to each related Underlying Mortgaged Property; and, as
of the Purchase Date for the related Purchased Asset, all insurance coverage
required under the Mezzanine Loan Documents and/or any Underlying Mortgage
Loan related to the Underlying Mortgaged Property, which insurance covers such
risks and is in such amounts as are customarily acceptable to prudent
commercial and multifamily mortgage lending institutions lending on the
security of property comparable to the related Underlying Mortgaged Property
in the jurisdiction in which such Underlying Mortgaged Property is located, is
in full force and effect with respect to each related Underlying Mortgaged
Property; all premiums due and payable for the related Purchased Asset have
been paid; and no notice of termination or cancellation with respect to any
such insurance policy has been received by Seller; and except for certain
amounts not greater than amounts which would be considered prudent by an
institutional commercial and/or multifamily mortgage lender with respect to a
similar mortgage loan and which are set forth in the Mezzanine Loan Documents
and/or any Underlying Mortgage Loan related to the Underlying Mortgaged
Property, any insurance proceeds in respect of a casualty loss, will be
applied either (i) to the repair or restoration of all or part of the related
Underlying Mortgaged Property or (ii) the reduction of the outstanding
principal balance of the Underlying Mortgage Loan, subject in either case to
requirements with respect to leases at the related Underlying Mortgaged
Property and to other exceptions customarily provided for by
Schedule 1(c)-5
prudent institutional lenders for similar loans. The Underlying Mortgaged
Property is also covered by comprehensive general liability insurance against
claims for personal and bodily injury, death or property damage occurring on,
in or about the related Underlying Mortgaged Property, in an amount
customarily required by prudent institutional lenders. An architectural or
engineering consultant has performed an analysis of the Underlying Mortgaged
Properties located in seismic zone 3 or 4 in order to evaluate the structural
and seismic condition of such property, for the sole purpose of assessing the
probable maximum loss ("PML") for the Underlying Mortgaged Property in the
event of an earthquake. In such instance, the PML was based on a 475 year
lookback with a 10% probability of exceedance in a 50 year period. If the
resulting report concluded that the PML would exceed 20% of the amount of the
replacement costs of the improvements, earthquake insurance on such Underlying
Mortgaged Property was obtained by an insurer rated at least A-:V by A.M. Best
Company or "BBB-" (or the equivalent) from S&P and Fitch or "Baa3" (or the
equivalent) from Moody's. If the Underlying Mortgaged Property is located in
Florida or within 25 miles of the coast of Texas, Louisiana, Mississippi,
Alabama, Georgia, North Carolina or South Carolina such Underlying Mortgaged
Property is insured by windstorm insurance in an amount at least equal to the
lesser of (i) the outstanding principal balance of such Underlying Mortgage
Loan and (ii) 100% of the full insurable value, or 100% of the replacement
cost, of the improvements located on the related Underlying Mortgaged
Property.
32. The insurance policies contain a standard mortgagee clause naming the
mortgagee, its successors and assigns as loss payee, in the case of a property
insurance policy, and additional insured in the case of a liability insurance
policy and provide that they are not terminable without 30 days prior written
notice to the mortgagee (or, with respect to non-payment, 10 days prior
written notice to the mortgagee) or such lesser period as prescribed by
applicable law. Each Mortgage requires that the Mortgagor maintain insurance
as described above or permits the mortgagee to require insurance as described
above, and permits the mortgagee to purchase such insurance at the Mortgagor's
expense if Mortgagor fails to do so.
33. There is no material and adverse environmental condition or circumstance
affecting the Underlying Mortgaged Property; there is no material violation of
any applicable Environmental Law with respect to the Underlying Mortgaged
Property; neither Seller nor the owner of the Underlying Mortgaged Property
has taken any actions which would cause the Underlying Mortgaged Property not
to be in compliance with all applicable Environmental Laws; the Underlying
Mortgage Loan documents require the Mortgagor to comply with all Environmental
Laws; and each Mortgagor has agreed to indemnify the mortgagee for any losses
resulting from any material, adverse environmental condition or failure of the
Mortgagor to abide by such Environmental Laws or has provided environmental
insurance.
34. No borrower under the Mezzanine Loan nor any Mortgagor under any
Underlying Mortgage Loan is a debtor in any state or federal bankruptcy or
insolvency proceeding.
35. Each related Underlying Mortgaged Property was inspected by or on behalf
of the related originator or an affiliate during the 12 month period prior to
the related origination date.
Schedule 1(c)-6
36. There are no material violations of any applicable zoning ordinances,
building codes and land laws applicable to the Underlying Mortgaged Property
or the use and occupancy thereof which (i) are not insured by an ALTA lender's
title insurance policy, or its equivalent as adopted in the applicable
jurisdiction, or a law and ordinance insurance policy or (ii) would have a
material adverse effect on the value, operation or net operating income of the
Underlying Mortgaged Property. The Mezzanine Loan Documents and the Underlying
Mortgage Loan documents require the Underlying Mortgaged Property to comply
with all applicable laws and ordinances.
37. None of the material improvements which were included for the purposes of
determining the appraised value of any related Underlying Mortgaged Property
at the time of the origination of the Mezzanine Loan or any related Underlying
Mortgage Loan lies outside of the boundaries and building restriction lines of
such property (except Underlying Mortgaged Properties which are legal
non-conforming uses), to an extent which would have a material adverse affect
on the value of the Underlying Mortgaged Property or the related Mortgagor's
use and operation of such Underlying Mortgaged Property (unless affirmatively
covered by title insurance) and no improvements on adjoining properties
encroached upon such Underlying Mortgaged Property to any material and adverse
extent (unless affirmatively covered by title insurance).
38. As of the Purchase Date, there was no pending action, suit or proceeding,
or governmental investigation of which the Seller, the Mezzanine Borrower or
the owner of the Underlying Mortgaged Property has received notice, against
the Mortgagor or the related Underlying Mortgaged Property the adverse outcome
of which could reasonably be expected to materially and adversely affect the
Mezzanine Loan or the Underlying Mortgage Loan.
39. The improvements located on the Underlying Mortgaged Property are either
not located in a federally designated special flood hazard area or, if so
located, the Mortgagor is required to maintain or the mortgagee maintains,
flood insurance with respect to such improvements and such policy is in full
force and effect in an amount no less than the lesser of (i) the original
principal balance of the Underlying Mortgage Loan, (ii) the value of such
improvements on the related Underlying Mortgaged Property located in such
flood hazard area or (iii) the maximum allowed under the related federal flood
insurance program.
40. Except for Mortgagors under Underlying Mortgage Loans the Underlying
Mortgaged Property with respect to which includes a Ground Lease, the related
Mortgagor (or its affiliate) has title in the fee simple interest in each
related Underlying Mortgaged Property.
41. The related Underlying Mortgaged Property is not encumbered, and none of
the Mezzanine Loan Documents or any Underlying Mortgage Loan documents permits
the related Underlying Mortgaged Property to be encumbered subsequent to the
Purchase Date of the related Purchased Asset without the prior written consent
of the holder thereof, by any lien securing the payment of money junior to or
of equal priority with, or superior to, the lien of the related Mortgage
(other than Title Exceptions, taxes, assessments and contested mechanics and
materialmens liens that become payable after such Purchase Date).
Schedule 1(c)-7
42. Each related Underlying Mortgaged Property constitutes one or more
complete separate tax lots (or the related Mortgagor has covenanted to obtain
separate tax lots and a Person has indemnified the mortgagee for any loss
suffered in connection therewith or an escrow of funds in an amount sufficient
to pay taxes resulting from a breach thereof has been established) or is
subject to an endorsement under the related title insurance policy.
43. An appraisal of the related Underlying Mortgaged Property was conducted
within 12 months of the origination of the Commercial Mortgage Loan, which
appraisal is signed by a qualified appraiser who had no interest, direct or
indirect, in the Underlying Mortgaged Property or in any loan made on the
security thereof; and whose compensation is not affected by the approval or
disapproval of the Mortgage Loan, and such appraisal and appraiser both
satisfied either (A) the requirements of the "Uniform Standards of
Professional Appraisal Practice" as adopted by the Appraisal Standards Board
of the Appraisal Foundation, or (B) the guidelines in Title XI of the
Financial Institutions Reform, Recovery and Enforcement Act or 1989, in either
case as in effect on the date such Underlying Mortgage Loan was originated.
44. The related Underlying Mortgaged Property is served by public utilities,
water and sewer (or septic facilities) and otherwise appropriate for the use
in which the Underlying Mortgaged Property is currently being utilized.
45. To the extent required under applicable law, Seller is authorized to
transact and do business in each jurisdiction in which a Mortgaged Property is
located at all times when it held the Mezzanine Loan.
46. The Mezzanine Collateral does not secure any mezzanine loan other than the
Mezzanine Loan being transferred and assigned to the Buyer hereunder (except
for Mezzanine Loans, if any, which are cross-collateralized with other
Mezzanine Loans being conveyed to the Buyer or subsequent transferee hereunder
and identified on the Purchased Asset Schedule).
47. Pursuant to the terms of the Mezzanine Loan Documents, the Seller
satisfied any transfer conditions or requirements (or such conditions or
requirements were validly waived by any requisite parties) in the Mezzanine
Loan Documents with respect to the sale of the Mezzanine Loan to the Buyer.
48. Each Mezzanine Loan has a Loan-to-Value Ratio of 90% or less
49. With respect to each related Underlying Mortgaged Property consisting of a
Ground Lease, Seller represents and warrants the following with respect to the
related Ground Lease:
(i) Such Ground Lease or a memorandum thereof has been or will
be duly recorded no later than 30 days after the origination date of the
related Purchased Asset and such Ground Lease permits the interest of the
lessee thereunder to be encumbered by the related Mortgage or, if consent of
the lessor thereunder is required, it has been obtained prior to the
origination date.
(ii) Upon the foreclosure of the Underlying Mortgage Loan (or
acceptance of a deed in lieu thereof), the Mortgagor's interest in such Ground
Lease is assignable to the mortgagee
Schedule 1(c)-8
under the leasehold estate and its assigns without the consent of the lessor
thereunder (or, if any such consent is required, it has been obtained prior to
the Purchase Date).
(iii) Such Ground Lease may not be amended, modified, canceled or
terminated without the prior written consent of the mortgagee and any such
action without such consent is not binding on the mortgagee, its successors or
assigns, except termination or cancellation if (i) an event of default occurs
under the Ground Lease, (ii) notice thereof is provided to the mortgagee and
(iii) such default is curable by the mortgagee as provided in the Ground Lease
but remains uncured beyond the applicable cure period.
(iv) Such Ground Lease is in full force and effect, there is no
material default under such Ground Lease, and there is no event which, with
the passage of time or with notice and the expiration of any grace or cure
period, would constitute a material default under such Ground Lease.
(v) The Ground Lease or ancillary agreement between the lessor
and the lessee requires the lessor to give notice of any default by the lessee
to the mortgagee. The Ground Lease or ancillary agreement further provides
that no notice given is effective against the mortgagee unless a copy has been
given to the mortgagee in a manner described in the Ground Lease or ancillary
agreement.
(vi) The Ground Lease (i) is not subject to any liens or encumbrances
superior to, or of equal priority with, the Mortgage, subject, however, to
only the Title Exceptions or (ii) is subject to a subordination,
non-disturbance and attornment agreement to which the mortgagee on the
lessor's fee interest in the Underlying Mortgaged Property is subject.
(vii) A mortgagee is permitted a reasonable opportunity (including,
where necessary, sufficient time to gain possession of the interest of the
lessee under the Ground Lease) to cure any curable default under such Ground
Lease before the lessor thereunder may terminate such Ground Lease.
(viii) Such Ground Lease has an original term (together with any
extension options, whether or not currently exercised, set forth therein all
of which can be exercised by the mortgagee if the mortgagee acquires the
lessee's rights under the Ground Lease) that extends not less than 20 years
beyond the stated maturity date of the Mortgage.
(ix) Under the terms of such Ground Lease, any estoppel or consent
letter received by the mortgagee from the lessor, and the related Mortgage,
taken together, any related insurance proceeds or condemnation award (other
than in respect of a total or substantially total loss or taking) will be
applied either to the repair or restoration of all or part of the related
Underlying Mortgaged Property, with the mortgagee or a trustee appointed by it
having the right to hold and disburse such proceeds as repair or restoration
progresses, or to the payment or defeasance of the outstanding principal
balance of the Underlying Mortgage Loan, together with any accrued interest
(except in cases where a different allocation would not be viewed as
commercially unreasonable by any commercial mortgage lender, taking into
account the relative duration of the Ground Lease and the related Mortgage and
the ratio of the market value of the related
Schedule 1(c)-9
Underlying Mortgaged Property to the outstanding principal balance of such
Underlying Mortgage Loan).
(x) The Ground Lease does not impose any restrictions on subletting
that would be viewed as commercially unreasonable by a prudent commercial
lender.
(xi) The ground lessor under such Ground Lease is required to enter
into a new lease upon termination of the Ground Lease for any reason, including
the rejection of the Ground Lease in bankruptcy.
50. The Transactions under this Repurchase Agreement constitute a sale of, or
creates a valid, first priority security interest in favor of the Buyer, in
the Mezzanine Loans.
51. The Mortgagor of the Underlying Mortgage Loan is not an Affiliate of the
Seller.
52. Except as disclosed in the summary information delivered to the Buyer, no
Purchased Asset has been acquired by an Affiliate other than a direct parent
of the Seller.
Schedule 1(c)-10
Schedule 1(d)
Reserved
Schedule 1(d)-11
Schedule 1(e)
REPRESENTATIONS AND WARRANTIES
RE: PURCHASED ASSETS CONSISTING OF SECURITIES
Seller represents and warrants to Buyer, with respect to each
Purchased Asset which is a Security, that except as specifically disclosed to
and approved by Buyer in accordance with the Repurchase Agreement, as of the
Purchase Date for each such Purchased Asset by Buyer from Seller and as of the
date of each Transaction hereunder and at all times while the Facility
Documents or any Transaction hereunder is in full force and effect the
representations set forth on this Schedule 1(d) shall be true and correct in
all material respects. For purposes of this Schedule 1(d) and the
representations and warranties set forth herein, a breach of a representation
or warranty shall be deemed to have been cured with respect to a Purchased
Asset which is a Security if and when Seller has taken or caused to be taken
action such that the event, circumstance or condition that gave rise to such
breach no longer affects such Purchased Asset.
1. The CMBS Security consists of pass-through certificates Rated no lower than
[ ] representing beneficial ownership interests in one or more first lien
mortgage loans secured by commercial and/or multifamily properties.
2. Immediately prior to the sale, transfer and assignment to Buyer thereof,
Seller had good and marketable title to, and was the sole owner and holder of,
such Security, and Seller is transferring such Security free and clear of any
and all liens, pledges, encumbrances, charges, security interests or any other
ownership interests of any nature encumbering such Security.
3. Seller has full right, power and authority to sell and assign such Security
and such Security has not been cancelled, satisfied or rescinded in whole or
part nor has any instrument been executed that would effect a cancellation,
satisfaction or rescission thereof.
4. Other than consents and approvals obtained as of the related Purchase Date
or those already granted in the related documents governing such Security, no
consent or approval by any Person is required in connection with Buyer's
acquisition of such Security, for Buyer's exercise of any rights or remedies
in respect of such Security or for Buyer's sale or other disposition of such
Security. No third party holds any "right of first refusal", "right of first
negotiation", "right of first offer", purchase option, or other similar rights
of any kind, and no other impediment exists to any such transfer or exercise
of rights or remedies.
5. Upon consummation of the purchase contemplated to occur in respect of such
Security on the Purchase Date therefor, Seller will have validly and
effectively conveyed to Buyer all legal and beneficial interest in and to such
Security free and clear of any and all liens, pledges, encumbrances, charges,
security interests or any other ownership interests of any nature.
Schedule 1(e)-1
6. The Security is a certificated security in registered form, or is in
uncertificated form and held through the facilities of (a) The Depository
Trust Corporation in New York, New York, or (b) such other clearing
organization or book-entry system as is approved in writing by the Buyer.
7. With respect to any Security that is a certificated security, Seller has
delivered to Buyer or its designee such certificated security, along with any
and all certificates, assignments, bond powers executed in blank, necessary to
transfer such certificated security under the issuing documents of such
Security.
8. All information contained in the related Asset File, Closing Data Tape and
Purchased Asset Schedule (or as otherwise provided to Buyer) in respect of
such Security is accurate and complete in all material respects.
9. As of the date of its issuance, such Security complied in all material
respects with, or was exempt from, all requirements of federal, state or local
law relating to the issuance thereof including, without limitation, any
registration requirements of the Securities Act of 1933, as amended.
10. Except as included in related Asset File, Closing Data Tape and Purchased
Asset Schedule, there is no document that by its terms modifies or affects the
rights and obligations of the holder of such Security, the terms of the
related pooling and servicing agreement or any other agreement relating to the
Security, and, since issuance, there has been no material change or waiver to
any term or provision of any such document, instrument or agreement.
11. To Seller's actual knowledge after due inquiry, there is no (i) monetary
default, breach or violation exists with respect to any Governing Agreement or
other document governing or pertaining to such Security, (ii) material
non-monetary default, breach or violation exists with respect to any such
Governing Agreement or other document or other document governing or
pertaining to such Security, or (iii) event which, with the passage of time or
with notice and the expiration of any grace or cure period, would constitute a
default, breach, violation or event of acceleration under such documents or
agreements.
12. No consent, approval, authorization or order of, or registration or filing
with, or notice to, any court or governmental agency or body having
jurisdiction or regulatory authority over Seller is required for any transfer
or assignment of such Security.
13. Except as disclosed in the Asset File, Closing Data Tape and Purchased
Asset Schedule, (i) no interest shortfalls have occurred and no realized
losses have been applied to any Security or otherwise incurred with respect to
any mortgage loan related to such Security nor any class of Security issued
under the same governing documents as any Security, and (ii) the Seller is not
aware of any circumstances that could have a material adverse effect on the
Security.
14. There are no circumstances or conditions with respect to the Security, the
Underlying Mortgaged Property or the related Mortgagor's credit standing that
can reasonably be expected to cause private institutional investors to regard
the Security as an unacceptable investment or adversely affect the value or
marketability of the Security.
Schedule 1(e)-2
15. Seller has not received written notice of any outstanding liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind for which the holder of such Security is
or may become obligated.
16. There is no material inaccuracy in any servicer report or trustee report
delivered to it (and, in turn, delivered pursuant to the terms of this
Repurchase Agreement) in connection with such Security.
17. No servicer of the Security has made any advances, directly or indirectly,
with respect to the Security or to any mortgage loan relating to such
Security.
18. Except as disclosed in the summary information delivered to the Buyer, no
Purchased Asset has been acquired by an Affiliate other than a direct parent
of the Seller.
Schedule 1(e)-3
Sch. 1(f)-1
SCHEDULE 2
INDEBTEDNESS
Seller's borrowings as of December 31, 2006 are summarized as follows:
---------------------------- ------------- ------------- ------------- ------------ ----------------- --------------- --------------
Reverse Credit Commercial CDOs Senior Trust Total
Repurchase Facilities Mortgage Unsecured Preferred Borrowings
Agreements Loan Pools Notes Securities
---------------------------- ------------- ------------- ------------- ------------ ----------------- --------------- --------------
Outstanding Borrowings $799,669 $75,447 $1,250503 $1,812,574 $75,000 $180,477 $4,193,670
---------------------------- ------------- ------------- ------------- ------------ ----------------- --------------- --------------
Weighted average borrowing 5.37% 6.69% 3.99% 6.02% 7.20% 7.64% 5.39%
rate
---------------------------- ------------- ------------- ------------- ------------ ----------------- --------------- --------------
Weighted average remaining 78 days 193 days 5.8 years 7.0 years 10.0 years 29.1 years 6.3 years
maturity
---------------------------- ------------- ------------- ------------- ------------ ----------------- --------------- --------------
Estimated fair value of $854,074 $88,876 $1,271,014 $2,096,455 - - $4,310,419
assets pledged
---------------------------- ------------- ------------- ------------- ------------ ----------------- --------------- --------------
Sch. 2-1
SCHEDULE 3
UCC FILING JURISDICTIONS
Maryland
Sch. 3-1
SCHEDULE 4
AUTHORIZED REPRESENTATIVES
SELLER NOTICES
Name: ▇▇▇▇▇▇▇ ▇▇▇▇, Esq Address: Anthracite Capital, Inc.
Telephone: ▇▇▇.▇▇▇.▇▇▇▇ c/o Blackrock Financial Management, Inc.
Facsimile: 212.810.8758 ▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
SELLER AUTHORIZATIONS
Any of the persons whose signatures and titles appear below are authorized,
acting singly, to act for Seller under this Repurchase Agreement:
Name Title Signature
--------------------------- ----------------------------- ----------------------
▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Chief Executive Officer
▇▇▇▇▇▇▇ ▇▇▇▇ President and Chief
Operating Officer
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Secretary
Sch. 4-1
BUYER NOTICES
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Address: ▇▇▇▇▇▇ Commercial Paper Inc.
▇▇▇▇▇▇ Commercial Paper, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
BUYER AUTHORIZATIONS
Any of the persons whose signatures and titles appear below, including any other
authorized officers, are authorized, acting singly, to act for Buyer under this
Repurchase Agreement:
Name Title Signature
--------------------------- ----------------------------- ----------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Sch. 4-2
Sch. 5-1
SCHEDULE 5
RESPONSIBLE OFFICERS
▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ - Chief Executive Officer
▇▇▇▇▇▇▇ ▇▇▇▇ - President and Chief Operating Officer
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ - Secretary
Sch. 5-1
Exh. A-5
EXHIBIT A
---------
FORM OF OPINION OF SELLER'S COUNSEL
_________, ____
▇▇▇▇▇▇ Commercial Paper Inc.
[ ]
Ladies and Gentlemen:
We have acted as counsel to Anthracite Capital, Inc. ("Seller") in connection
with the sale and repurchase by Seller of certain assets (the "Eligible Assets")
purchased from time to time (each such date, a "Purchase Date") by ▇▇▇▇▇▇
Commercial Paper Inc. ("Buyer") pursuant to a Master Repurchase Agreement, dated
as of [ ], 200[ ], between Seller and Buyer (the "Master Repurchase Agreement").
Capitalized terms used but not defined herein shall have the meanings set forth
in the Master Repurchase Agreement.
We have acted as counsel to Seller in connection with the preparation, execution
and delivery of, and the initial purchase of Eligible Assets made under, the
Master Repurchase Agreement
In connection with rendering this opinion, we have examined such documents as we
have deemed necessary or advisable, including the following documents:
a. The Facility Documents;
b. The organizational documents of Seller;
c. The certified Consents of the Officer of Seller relating to the transactions
provided for in the Facility Documents;
d. A copy of a UCC-1 financing statement describing the Repurchase Assets naming
Seller as debtor and Buyer as secured party, which will be filed under the
Uniform Commercial Code as in effect in the State of ___________ with the office
of the [Secretary of the State] of _________ (the "Filing Office") on or about
________ __, 20__ (the "Financing Statement");
e. The reports attached hereto as Exhibit A (the "Search Reports"), which set
forth the results of an examination conducted by [Federal Research Corporation]
of all currently indexed UCC-1 financing statements naming Seller as debtor that
are on file in the Filing Office;
f. Good standing certificates, as of a recent date, for Seller from each of the
States listed on Schedule 1 attached hereto; and
g. The certificates, letters and opinions required to be furnished by Seller and
others in connection with the execution of the Facility Documents, and the
additional certificates, letter and documents delivered by or on behalf of such
parties concurrently herewith.
Exh. A-1
For purposes of the opinions expressed below, we have assumed the authenticity
of all documents submitted to us as originals, the genuineness of all
signatures, the legal capacity of natural persons and the conformity to the
originals of all documents.
Based solely upon the foregoing, we are of the opinion that:
1. Seller is a [[ ]], duly organized, validly existing and in good standing
under the laws of the State of [[ ]], and has the corporate power and
authority to own its properties and transact the business in which it is
engaged. Seller is duly qualified as a foreign [[ ]] to transact business in,
and is in good standing under, the laws of each state in which a mortgaged
property is located or is otherwise exempt under applicable law from such
qualification. The principal place of business of Seller is located at
___________.
2. Reserved.
3. Seller has the power to engage in the transactions contemplated by the
Facility Documents, and has all requisite power, authority and legal right to
execute and deliver the Facility Documents, to transfer and deliver the
Repurchase Assets and to perform and observe the terms and conditions of the
Facility Documents.
4. Reserved.
5. The Facility Documents have been duly and validly authorized, executed and
delivered by each of Seller, and are valid, legal and binding agreements,
enforceable against Seller in accordance with their respective terms, subject
to the effect of bankruptcy, insolvency, reorganization, moratorium or other
similar laws relating to or affecting the enforcement of creditors' rights
generally, none of which will materially interfere with the realization of the
benefits provided thereunder or with Buyer's ownership of the Purchased
Assets.
6. No consent, approval, authorization or order of, or notice, filing or
registration with, any court or governmental agency or body is required for
the execution, delivery and performance by Seller of, or compliance by such
entity with, the Facility Documents, or the transfer of the Repurchase Assets
or the consummation of the transactions contemplated by the Facility
Documents.
7. Neither the transfer or delivery of the Purchased Assets, nor the
consummation of any other of the transactions contemplated in the Facility
Documents, nor the fulfillment of the terms of the Facility Documents will
result in a breach of or constitutes or will constitute a default under (a)
the charter or by-laws of Seller, or the terms of any material indenture or
other agreement or instrument to which Seller is a party or by which it is
bound or to which it is subject, (b) any contractual or legal restriction
contained in any indenture, mortgage, deed of trust, agreement, instrument or
other similar document to which Seller is a party or by which it is bound or
to which it is subject, or (c) any statute or order, rule, regulation, writ,
injunction or decree of any court, governmental authority or regulatory body
to which Seller or any of its properties is subject or by which it is bound.
8. There are no actions, suits, proceedings or investigations pending or, to
the best of our knowledge, threatened against Seller that, in our judgment,
either in any one instance or in the
Exh A-2
aggregate, may result in any material adverse change in the business,
operations, financial condition, properties or assets of Seller or in any
material impairment of the right or ability of Seller to carry on its business
substantially as now conducted or in any material liability on the part of
Seller that would draw into question the validity of the Facility Documents,
or of any action taken or to be taken in connection with the transactions
contemplated thereby, or that would be likely to impair materially the ability
of Seller to perform under the terms of, the Facility Documents.
9. The conveyance of each Purchased Asset as and in the manner contemplated
by the Facility Documents is sufficient fully to transfer to Buyer all right,
title and interest of Seller thereto as owner, noteholder and mortgagee, or in
the alternative, a security interest therein.
10. The Repurchase Agreement is effective to create, in favor of the Buyer, a
valid "security interest" as defined in Section 1-201(37) of the Uniform
Commercial Code in all of the right, title and interest of the Seller in, to
and under the Repurchase Assets, except that (a) such security interests will
continue in Repurchase Assets after its sale, exchange or other disposition
only to the extent provided in Section 9-315 of the Uniform Commercial Code,
(b) the security interests in Repurchase Assets in which the Seller acquires
rights after the commencement of a case under the Bankruptcy Code in respect
of the Seller may be limited by Section 552 of the Bankruptcy Code.
11. When the Mortgage Notes are delivered to the Custodian, endorsed in blank
by a duly authorized officer of Seller, the security interest referred to in
Section 10 above in the Mortgage Notes will constitute a fully perfected
first-priority security interest in all right, title and interest of Seller
therein.
12. (a) Upon the filing of Financing Statements with the Filing Office, the
security interests referred to in Section 9 above will constitute a
fully perfected security interest under the Uniform Commercial Code in
all right, title and interest of Seller in, to and under such Repurchase
Assets, to the extent that a security interest therein can be perfected
by filing under the Uniform Commercial Code.
(b) Reserved
(c) The UCC Search Report sets forth the proper filing offices and the
proper debtors necessary to identify those Persons who have on file in
the jurisdictions listed on Schedule 1 financing statements covering the
Repurchase Assets as of the dates and times specified on Schedule 2. The
UCC Search Report identifies no Person who has filed in any Filing
Office a financing statement describing the Repurchase Assets prior to
the effective dates of the UCC Search Report.
13. Seller is not an "investment company", or a company "controlled" by an
"investment company," within the meaning of the Investment Company Act of
1940, as amended.
14. The provisions of the Control Agreement are effective to cause the
security interest of the Buyer in the Collection Account to be a fully
perfected first-priority security interest therein.
Exh. A-3
This opinion letter is made for the benefit of and can be relied on
by the addressee hereof, its successors and/or assigns, and any future
participant of Buyer's interest under the Repurchase Agreement.
Very truly yours,
_________________________________
Exh. A-4
EXHIBIT B
---------
SECURITIES ACCOUNT CONTROL AGREEMENT, dated as of [ ], 200[ ], as
amended from time to time (the "Agreement"), among ▇▇▇▇▇▇ Commercial Paper
Inc. (the "Buyer") and Anthracite Capital, Inc. (the "Seller"), [[ ] (the
"Servicer")] and [ ] (the "Securities Intermediary").
WHEREAS, the Seller and the Buyer, have entered into that certain
Repurchase Agreement, dated as of [ ], 200[ ] as amended from time to time
(the "Repurchase Agreement") pursuant to which the Buyer may enter into a
Transaction (as defined therein) secured by, among other things, the payments
made on account of Purchased Assets sold to the Buyer under the Repurchase
Agreement ("Distributions");
WHEREAS, the [Servicer] [Seller] has established that certain
account, Account No: [ ] in the name of the [Servicer] [Seller] for the
benefit of Buyer [and Seller] as [its] [their] interests may appear, with the
Securities Intermediary, ABA #[ ], subject to the security interest of the
Buyer, with the Securities Intermediary pursuant to the Repurchase Agreement
(the "Securities Account");
WHEREAS, pursuant to the Transaction, all Income is required to be
deposited into the Securities Account identified below upon receipt by the
Seller [or Servicer];
WHEREAS, the Seller [or Servicer] shall direct the Securities
Intermediary to invest such Income in accordance with the Repurchase
Agreement; and
WHEREAS, the Seller [and Servicer] [has] [have] granted to the Buyer
a security interest in the Securities Account and all financial assets
credited thereto and amounts held therein;
NOW, THEREFORE, the parties hereby agree as follows:
(a) Capitalized Terms. Capitalized terms used but not defined herein
shall have the meanings assigned in the Repurchase Agreement.
(b) Transfers To and From Securities Account; Control. The parties
agree that: (a) Income received by the Bank for credit to the Securities
Account are, except as provided below, for application as instructed by the
Seller [or Servicer]; (b) the Bank shall transfer funds from the Securities
Account in accordance with such instructions until the Bank receives notice
from the Buyer that an event of default has occurred and is continuing under
the Repurchase Agreement (a "Notice of Event of Default"); and (c) upon the
Bank's receipt of a Notice of Event of Default, the Bank shall (i) in no event
(A) transfer funds from the Securities Account to Seller [or the Servicer],
(B) act on the instruction of Seller [or the Servicer], or (C) cause or permit
withdrawals from the Securities Account in any manner not approved by the
Buyer in writing and (ii) comply with instructions originated by the Buyer
concerning the disposition of funds in the Securities Account without further
consent of Seller [or the Servicer].
B-1
(c) Entitlement Orders; Instructions. (i) If at any time the
Securities Intermediary shall receive any "entitlement order" (within the
meaning of Section 8-102(a)(8) of the UCC) from the Buyer, the Securities
Intermediary shall comply with such entitlement order without further consent
by Seller[, Servicer] or any other person.
(ii) If at any time prior to receipt by the Securities Intermediary
of a notice from the Buyer in substantially the form of Exhibit A hereto (a
"Notice of Exclusive Control"), the Securities Intermediary shall receive any
entitlement order or other written instruction from the Seller [or the Servicer]
including without limitation directing the transfer or redemption of any
financial asset credited to the Securities Account, the Securities Intermediary
shall comply with such entitlement order or written instruction without further
consent by the Buyer or any other person.
(c) Upon receipt by the Securities Intermediary of a Notice of
Exclusive Control, the Securities Intermediary shall cease complying with
Seller's [or Servicer's] entitlement orders and other written instructions
given by the Seller [or the Servicer] with respect to the Securities Account.
Without limitation of the foregoing, in the event of a conflict between a
Notice of Exclusive Control or another entitlement order originated by the
Buyer, on the one hand, and an entitlement order originated by Seller [or the
Servicer], on the other hand, the Notice of Exclusive Control or other
entitlement order originated by the Buyer shall prevail.
(d) The Securities Intermediary shall have no obligation to invest
or reinvest any cash held in the Securities Account in the absence of timely
and specific written investment directions from Seller [or the Servicer]. In
no event shall the Securities Intermediary be liable for the selection of
investments or for investment losses incurred thereon. The Securities
Intermediary shall have no liability in respect of losses incurred as a
results of the liquidation of any investment prior to its stated maturity or
the failure of Seller [or the Servicer] to provide timely written investment
direction.
(e) The Securities Intermediary or its affiliates are permitted to
receive additional compensation that could be deemed to be in the Securities
Intermediary's economic self-interest for (i) serving as investment adviser,
administrator, shareholder, servicing agent, custodian or sub-custodian with
respect to certain of the investments, (ii) using affiliates to effect
transactions in certain investments and (iii) effecting transactions in certain
investments.
(d) Certain Agreements Concerning Securities Account. The Securities
Intermediary hereby confirms and agrees that:
(i) The Securities Intermediary shall not change the name or
account number of the Securities Account without the prior written consent of
the Buyer;
(ii) There are no other agreements entered into between the
Securities Intermediary and Seller [or the Servicer] with respect to the
Securities Account;
(iii) It has not entered into, and until the termination of this
Agreement will not enter into, any agreement with any other person relating to
the Securities Account and/or any funds held therein pursuant to which it has
agreed, or will agree, to comply with orders or written instructions of such
other person; and
B-2
(iv) It has not entered into, and until the termination of this
Agreement will not enter into, any agreement with Seller [or the Servicer]
purporting to limit or condition the obligation of the Securities Intermediary
to comply with orders and other written instructions of the Buyer as set forth
in Section 2 above.
(e) Subordination of Lien; Waiver of Set-Off. (i) In the event that
the Securities Intermediary has or subsequently obtains by agreement, by
operation of law or otherwise a security interest in the Securities Account or
any financial assets credited thereto, the Securities Intermediary hereby
agrees that such security interest shall be subordinate to the security
interest of the Buyer. The financial assets credited to the Securities Account
will not be subject to deduction, set-off, banker's lien, or any other right
in favor of any person other than the Buyer (except that the Securities
Intermediary may set off (i) all amounts due to the Securities Intermediary in
respect of customary fees and expenses for the routine maintenance and
operation of the Securities Account and (ii) the face amount of any checks
which have been credited to the Securities Account but are subsequently
returned unpaid because of uncollected or insufficient funds, or (iii) other
returned items or mistakes made in crediting the Securities Account).
(ii) Seller [and the Servicer] hereby authorize the Securities
Intermediary, without prior notice, from time to time to debit any other
account Seller [or the Servicer] may have with the Securities Intermediary
pursuant to the Repurchase Agreement for the amount due the Securities
Intermediary hereunder.
(f) CHOICE OF LAW. THIS AGREEMENT SHALL BE GOVERNED BY THE LAWS OF
THE STATE OF NEW YORK. REGARDLESS OF ANY PROVISION IN ANY OTHER AGREEMENT, FOR
PURPOSES OF THE UCC, NEW YORK SHALL BE DEEMED TO BE THE "SECURITY
INTERMEDIARY'S JURISDICTION."
(g) Conflict with Other Agreements. (i) In the event of any conflict
between this Agreement (or any portion thereof) and any other agreement
between Seller [or the Servicer] and the Securities Intermediary now existing
or hereafter entered into, the terms of this Agreement shall prevail.
(ii) No amendment or modification of this Agreement or waiver of
any right hereunder shall be binding on any party hereto unless it is in writing
and is signed by all of the parties hereto.
(h) Adverse Claims. Except for the claims and interest of the Buyer,
[the Servicer] and of the Seller in the Securities Account, the Securities
Intermediary does not have actual knowledge of any claim to, or interest in,
the Securities Account or in financial assets credited thereto. If any person
asserts any lien, encumbrance or adverse claim (including any writ,
garnishment, judgment, warrant of attachment, execution or similar process)
against the Securities Account or against any financial assets credited
thereto, the Securities Intermediary, upon receipt of written notice, will
promptly notify the Buyer, [the Servicer] and the Seller thereof.
B-3
(i) Successors. The terms of this Agreement shall be binding upon,
and shall inure to the benefit of, the parties hereto and their respective
corporate successors or heirs and personal representatives who obtain such
rights solely by operation of law.
(j) Notices. Any notice, request or other communication required or
permitted to be given under this Agreement shall be in writing and deemed, to
have been properly given when delivered in person, or when sent by telecopy or
other electronic means and electronic confirmation of error free receipt is
received, or three days after being sent by certified or registered United
States mail, return receipt requested, postage prepaid, addressed to the party
at the address set forth below:
Seller:
[ ]
Attention:
Phone Number:
Fax Number:
Servicer:
[ ]
Attention:
Phone Number:
Fax Number:
with copies to the Buyer at the address below
Buyer:
▇▇▇▇▇▇ Commercial Paper Inc.
[ ]
Attention: [ ]
Phone Number: [ ]
Fax Number: [ ]
Securities Intermediary:
[ ]
Attention:
Phone Number:
Fax Number:
Any party may change its address for notices in the manner set forth
above.
(k) Termination. The obligations of the Securities Intermediary to
the Buyer pursuant to this Agreement shall continue in effect until the Buyer
has notified the Securities Intermediary of such termination in writing. The
Buyer agrees with the Seller [and the Servicer] to provide Notice of
Termination in substantially the form of Exhibit B hereto to the Securities
B-4
Intermediary on or after the termination of the Buyer's security interest in
the Securities Account pursuant to, or as otherwise provided by, the terms of
the Repurchase Agreement.
(l) Limitation of Liability; Indemnification of the Bank. Seller[,
the Servicer] and the Buyer hereby agree that (a) the Securities Intermediary
is released from any and all liabilities to the Seller[, the Servicer] and the
Buyer arising from the terms of this Agreement and the compliance of the
Securities Intermediary with the terms hereof, except to the extent that such
liabilities arise from the Securities Intermediary's bad faith, willful
misconduct or negligence and (b) the Seller[, the Servicer,] [its] [their]
successors and assigns shall at all times indemnify and save harmless the
Securities Intermediary from and against any loss, liability or expense
incurred without bad faith, willful misconduct or negligence on the part of
the Securities Intermediary, its officers, directors and agents, arising out
of or in connection with the execution and performance of this Agreement or
the maintenance of the Securities Account, including the costs and expenses of
defending themselves against any claim or liability in connection with the
performance of any of their powers or duties hereunder. The provisions of this
section shall survive the termination of this Agreement and the earlier of the
resignation or removal of the Securities Intermediary. [The Securities
Intermediary shall be entitled to the same rights, protections, immunities and
indemnities afforded to the Custodian under the Custodial Agreement.]
(m) Counterparts. This Agreement may be executed may be executed in
any number of counterparts, all of which shall constitute one and the same
instrument, and any party hereto may execute this Agreement by signing and
delivering one or more counterparts.
(n) Fees and Expenses of Securities Intermediary. Securities
Intermediary shall charge such fees for its services under this Agreement as
are set forth in a separate fee letter agreement between Securities
Intermediary and Seller, the payment of which fees, together with Securities
Intermediary's reasonable expenses in connection herewith, shall be solely the
obligation of Seller.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
B-5
IN WITNESS WHEREOF, the parties hereto have duly executed and
delivered this Securities Account Control Agreement, all as of the day and year
first above written.
[ ], as Seller
By:______________________________________________
Name:
Title:
[ ], as Servicer
By: ____________________________________________
Name:
Title:
▇▇▇▇▇▇ COMMERCIAL PAPER INC., as Buyer
By:______________________________________________
Name:
Title:
[ ], as Securities Intermediary
By:______________________________________________
Name:
Title:
B-6
Exhibit A to
Securities Account Control Agreement
------------------------------------
[LETTERHEAD OF ▇▇▇▇▇▇ COMMERCIAL PAPER INC.]
[Date]
[SECURITIES INTERMEDIARY]
[Address]
Attention: __________________
Re: Notice of Exclusive Control
---------------------------
Ladies and Gentlemen:
As referenced in the Securities Account Control Agreement dated as
of [ ], 200[ ], a copy of which is attached (the "Agreement"), among you, the
undersigned, [ ] (the "Seller") [and [ ] (the "Servicer")], we notify you
that we will hereafter exercise exclusive control over the Securities Account.
You are instructed not to accept any directions, instructions or entitlement
orders with respect to the Securities Account from any person other than the
undersigned unless otherwise ordered by a court of competent jurisdiction.
You are instructed to deliver a copy of this notice by facsimile
transmission to Seller.
Very truly yours,
▇▇▇▇▇▇ COMMERCIAL PAPER INC.
By: ________________________________
Name:
Title:
B-7
Exhibit B to
Securities Account Control Agreement
[LETTERHEAD OF ▇▇▇▇▇▇ COMMERCIAL PAPER INC.]
[Date]
[SECURITIES INTERMEDIARY]
[Address]
Attention: __________________
Notice of Termination of Securities Account Control Agreement
You are hereby notified that the Securities Account Control
Agreement, dated as of [ ], 200[ ], a copy of which is attached (the
"Agreement"), among you, the undersigned, [ ] (the "Seller") [and [ ]
(the "Servicer")] is terminated and you have no further obligations to the
undersigned pursuant to the Agreement. Notwithstanding any previous
instructions to you, you are hereby instructed to accept all future directions
with respect to the Securities Account from the Seller. This notice terminates
any obligations you may have to the undersigned with respect to the Securities
Account; provided, however, that nothing contained in this notice shall alter
any obligations which you may otherwise owe to the undersigned pursuant to any
other agreement.
Very truly yours,
▇▇▇▇▇▇ COMMERCIAL PAPER INC.
By:________________________________
Name:
Title:
Exh. B-8
EXHIBIT C
---------
Purchased Asset Schedule Fields
-------------- ----------- ------------- ------------ -------- -------- ------------ ------------ --------------- --------------
Original Current
Principal Principal
Proposed Amount of Amount of
Property Name of Purchase Asset Asset Eligible Eligible Anticipated
Loan Number Name Borrower Date Class Type Asset Asset Asset Value Pricing Rate
-------------- ----------- ------------- ------------ -------- -------- ------------ ------------ --------------- --------------
-------------- ----------- ------------- ------------ -------- -------- ------------ ------------ --------------- --------------
(table continued)
-------------- -------------- ------------- ------------- ---------------
Purchase Requested Requested Requested
Price Purchase Repurchase Repurchase
Loan Number Percentage Price Date Date, if any
-------------- -------------- ------------- ------------- ---------------
-------------- -------------- ------------- ------------- ---------------
Exh. C-1
EXHIBIT D
---------
FORM OF ASSET FILE
(i) With respect to each Purchased Asset constituting a Commercial
Mortgage Loan:
(A) the original Mortgage Note bearing all intervening
endorsements into Seller, and further endorsed by Seller
"Pay to the order of _________ without recourse and signed
in the name of Seller by an authorized Person, or a lost
note affidavit, together with an indemnity in a form
reasonably approved by Buyer with a copy of the applicable
Mortgage Note attached thereto;
(B) the original or copy of any loan agreement, guarantee or
indemnity executed in connection with the Purchased Asset;
(C) the original or a certified copy of the Mortgage with
evidence of recording thereon, or a copy thereof together
with an officer's certificate of Seller certifying that
such copy represents a true and correct copy of the
original and that such original has been submitted for
recordation in the appropriate governmental recording
office of the jurisdiction where the Mortgaged Property is
located;
(D) the originals or certified copies of all assumption,
modification, consolidation or extension agreements with
evidence of recording thereon, or copies thereof together
with an officer's certificate of Seller certifying that
such copies represent true and correct copies of the
originals and that such originals have each been submitted
for recordation in the appropriate governmental recording
office of the jurisdiction where the Mortgaged Property is
located;
(E) the original Assignment of Mortgage in blank for each
Purchased Asset, in form and substance suitable for
recording and otherwise reasonably acceptable to Buyer and
signed in the name of Seller;
(F) the originals of all intervening assignments of mortgage
[into Parent] with evidence of recording thereon, or
copies thereof together with an officer's certificate of
Seller certifying that such copies represent true and
correct copies of the originals and that such originals
have each been submitted for recordation in the
appropriate governmental recording office of the
jurisdiction where the Mortgaged Property is located;
▇▇▇. ▇-▇
(G) [if applicable, an Assignment of Mortgage relating to such
Purchased Asset assigning the Mortgage for such Purchased
Asset from Parent to Seller];
(H) the original or a copy of the mortgagee title insurance
policy or, if the original mortgagee title insurance
policy has not been issued, the original or a copy of the
irrevocable marked commitment to issue the same;
(I) the original of any cash management agreement, security
agreement, chattel mortgage or equivalent document
executed in connection with the Purchased Asset, if any;
(J) all other documents and instruments evidencing,
guaranteeing, insuring or otherwise constituting or
modifying or otherwise affecting such Purchased Asset, or
otherwise executed or delivered in connection with, or
otherwise relating to, such Purchased Asset, including all
documents establishing or implementing any lockbox
pursuant to which Seller is entitled to receive any
payments from cash flow of the underlying real property;
(K) the original assignment of leases and rents, if any, with
evidence of recording thereon, or a copy thereof together
with an officer's certificate of Seller certifying that
such copy represents a true and correct copy of the
original and that such original has been submitted for
recordation in the appropriate governmental recording
office of the jurisdiction where the Mortgaged Property is
located;
(L) the originals of all intervening assignments of
assignments of leases and rents in blank for each
Purchased Asset, in form and substance suitable for
recording and otherwise reasonably acceptable to Buyer and
signed in the name of Seller, or copies thereof together
with an officer's certificate of Seller certifying that
such copies represent true and correct copies of the
originals and that such originals have each been submitted
for recordation in the appropriate governmental recording
office of the jurisdiction where the Mortgaged Property is
located;
(M) a copy of any UCC-1 financing statements filed in
connection with such Purchased Asset, certified as true
and correct by Seller, and all necessary UCC-3
continuation statements with evidence of filing thereon or
copies thereof together with an officer's certificate of
Seller certifying that such copies represent true and
correct copies of the originals and that such originals
have each been submitted for filing in the appropriate
governmental recording office of the appropriate
jurisdiction and UCC-3
Exh. D-2
assignments prepared by Seller in blank, which UCC
assignments shall be in form and substance acceptable for
filing;
(N) the original environmental indemnity agreement, if any,
executed in connection with the Purchased Assets;
(O) all original letters of credit and originals or certified
copies of any interest rate cap or swap agreements
relating to such Purchased Asset;
(P) the original omnibus assignment in blank, if any, for each
Purchased Asset in form and substance reasonably
acceptable to Buyer and sufficient to transfer to Buyer
all of Seller's rights, title and interest in and to the
Purchased Asset, signed in the name of Seller;
(Q) UCC-1 financing statements prepared by Seller for the
purpose of perfecting Seller's security interest in such
Purchased Asset, which such UCC-1 financing statements
shall be reasonably acceptable to Buyer and in form and
substance acceptable for filing;
(R) UCC-3 assignments prepared by Seller in favor of Buyer for
the purpose of assigning Seller's security interest in
such Purchased Asset to Buyer, which such UCC-3
assignments shall be reasonably acceptable to Buyer and in
form and substance acceptable for filing;
(S) UCC-1 financing statements prepared by Seller in favor of
Buyer for the purpose of perfecting Buyer's security
interest in such Purchased Asset, which such UCC-1
financing statements shall be reasonably acceptable to
Buyer and in form and substance acceptable for filing;
(T) in respect of any Purchased Asset which is secured by a
Hotel or Motel, any franchise or reservation system
agreement and any franchise "comfort letter";
(U) in respect of any Purchased Asset as to which the
Mortgaged Property or underlying real property, as
applicable, consists of a leasehold interest, the ground
lease, memorandum of ground lease and ground lessor
consent and/or estoppel; and
(V) such other documents, agreements or instruments as shall
be reasonably requested by Buyer.
(ii) With respect to each Purchased Asset constituting a Mezzanine
Loan:
Exh. D-3
(A) the original Mezzanine Note signed in connection with the
Purchased Asset, bearing all intervening endorsements into
Seller, and further endorsed by Seller "Pay to the order
of __________ without recourse or, except as provided in
that certain Master Repurchase Agreement, dated as of May
1, 2007 between Anthracite Capital, Inc. and ▇▇▇▇▇▇
Commercial Paper Inc., warranty" and signed in the name of
Seller by an authorized Person or a lost note affidavit
together with an indemnity in a form reasonably approved
by Buyer with a copy of the applicable Mezzanine Note
attached thereto;
(B) the original or a copy of any loan agreement and guarantee
or indemnity executed in connection with the Purchased
Asset;
(C) the original or a copy of any intercreditor or loan
coordination agreement executed in connection with the
Purchased Asset;
(D) the original or a copy security agreement executed in
connection with the Purchased Asset, pursuant to which the
pledged ownership interests have been transferred to, or
otherwise made subject to a first priority security
interest in favor of Seller;
(E) the original or a copy of all other documents and
instruments evidencing, guaranteeing, insuring or
otherwise constituting or modifying or otherwise affecting
such Purchased Asset, or otherwise executed or delivered
in connection with, or otherwise relating to, such
Purchased Asset, including all documents establishing or
implementing any lockbox pursuant to which Seller is
entitled to receive any payments from cash flow of the
underlying real property;
(F) a copy of any UCC-1 financing statements filed in
connection with such Purchased Asset, certified as true
and correct by Seller, and all necessary UCC-3
continuation statements with evidence of filing thereon or
copies thereof together with an officer's certificate of
Seller certifying that such copies represent true and
correct copies of the originals and that such originals
have each been submitted for filing in the appropriate
governmental recording office of the appropriate
jurisdiction and UCC-3 assignments prepared by Seller in
blank, which UCC assignments shall be in form and
substance acceptable for filing;
(G) the original certificates representing the pledged equity
interests (if any);
(H) original stock powers relating to each pledged equity
interest, executed in blank, if an original stock
certificate is provided;
▇▇▇. ▇-▇
(I) the original environmental indemnity agreement, if any,
executed in connection with the Purchased Assets;
(J) all original letters of credit and originals or certified
copies of any interest rate cap or swap agreements
relating to such Purchased Asset;
(K) the original omnibus assignment in blank, if any, for such
Purchased Asset in form and substance reasonably
acceptable to Buyer and sufficient to transfer to Buyer
all of Seller's rights, title and interest in and to the
Purchased Asset, signed in the name of Seller;
(L) UCC-1 financing statements prepared by Seller for the
purpose of perfecting Seller's security interest in such
Purchased Asset, which such UCC-1 financing statements
shall be reasonably acceptable to Buyer and in form and
substance acceptable for filing;
(M) UCC-3 assignments prepared by Seller in favor of Buyer for
the purpose of assigning Seller's security interest in
such Purchased Asset to Buyer, which such UCC-3
assignments shall be reasonably acceptable to Buyer and in
form and substance acceptable for filing;
(N) UCC-1 financing statements prepared by Seller in favor of
Buyer for the purpose of perfecting Buyer's security
interest in such Purchased Asset, which such UCC-1
financing statements shall be reasonably acceptable to
Buyer and in form and substance acceptable for filing; and
(O) such other documents, agreements or instruments as shall
be reasonably requested by Buyer.
(iii) With respect to each Purchased Asset constituting a Junior
Interest:
(A) the original certificates representing the Purchased
Assets, if any, together with originals of all intervening
assignments;
(B) the original of any participation agreement, intercreditor
agreement, paying agency, servicing agreement or similar
agreement executed in connection with the Purchased Asset,
together with the original of all intervening assignments;
(C) the original assignment of Purchased Asset sufficient to
transfer to Buyer all of Seller's rights, title and
interest in and to the Purchased Asset;
▇▇▇. ▇-▇
(▇) all original letters of credit and originals or certified
copies of any interest rate cap or swap agreements
relating to such Purchased Asset;
(E) UCC-1 financing statements prepared by Seller for the
purpose of perfecting Seller's security interest in such
Purchased Asset, which such UCC-1 financing statements
shall be reasonably acceptable to Buyer and in form and
substance acceptable for filing;
(F) UCC-3 assignments prepared by Seller in favor of Buyer for
the purpose of assigning Seller's security interest in
such Purchased Asset to Buyer, which such UCC-3
assignments shall be reasonably acceptable to Buyer and in
form and substance acceptable for filing;
(G) UCC-1 financing statements prepared by Seller in favor of
Buyer for the purpose of perfecting Buyer's security
interest in such Purchased Asset, which such UCC-1
financing statements shall be reasonably acceptable to
Buyer and in form and substance acceptable for filing; and
(H) such other documents, agreements or instruments as shall
be reasonably requested by Buyer.
(o) From time to time, Seller shall forward to the Custodian
additional original documents or additional documents evidencing any
assumption, modification, consolidation or extension of a Purchased Asset
approved in accordance with the terms of this Repurchase Agreement, and upon
receipt of any such other documents, the Custodian shall hold such other
documents as Buyer shall request from time to time. With respect to any
documents which have been delivered or are being delivered to recording
offices for recording and have not been returned to Seller in time to permit
their delivery hereunder at the time required, in lieu of delivering such
original documents, Seller shall deliver to Buyer a true copy thereof with an
officer's certificate certifying that such copy is a true, correct and
complete copy of the original, which has been transmitted for recordation.
Seller shall deliver such original documents to the Custodian promptly when
they are received. The Asset Files shall be maintained in accordance with the
Custodial Agreement. Any Asset Files not required to be delivered to Buyer or
its designee (including the Custodian) are and shall be held in trust by
Seller or its designee for the benefit of Buyer as the owner thereof. Seller
or its designee shall maintain a copy of the Asset File. The temporary
possession of any documents required to be included in the Asset File by
Seller under any provision hereof is at the will of Buyer for the sole purpose
of servicing the related Purchased Asset, and such retention and possession by
Seller or its designee is in a custodial capacity only. The books and records
(including, without limitation, any computer records or tapes) of Seller and
Servicer shall be marked appropriately to reflect clearly the sale of the
related Purchased Asset to Buyer.
Exh. D-6
EXHIBIT E
---------
Underwriting Guidelines
Exh. E-1
EXHIBIT F
---------
Seller's Officer's Certificate
I, ___________________, do hereby certify that I am duly elected,
qualified and authorized officer of [SELLER] ("Seller"). This Certificate is
delivered to you in connection with Section 12(d) of the Master Repurchase
Agreement dated as of _________ ___, 200_, among Anthracite Capital, Inc. and
▇▇▇▇▇▇ Commercial Paper, Inc. (the "Agreement"). I hereby certify that, as of
the date of the financial statements attached hereto and as of the date hereof,
Seller is and has been in compliance with all the terms of the Agreement and,
without limiting the generality of the foregoing, I certify that:
(i) Maintenance of Tangible Net Worth. The Seller has
maintained a Tangible Net Worth at the end of each fiscal quarter of
not less than the sum of (i) $400,000,000 plus (ii) an amount equal
to 75% of any Equity Proceeds.
(ii) Maintenance of Ratio of Total Indebtedness to Tangible Net
Worth. The Seller has maintained the ratio of Indebtedness
(excluding non-recourse Indebtedness) to Tangible Net Worth at the
end of each fiscal quarter no greater than 3:1.
(iii) Debt Service Coverage Ratio. The Seller has maintained a
Debt Service Coverage Ratio of no less than 1.20:1.
(iv) Maintenance of Liquidity. The Seller has ensured that, as
of the end of each fiscal quarter, the sum of (a) Cash, (b)
unencumbered and unpledged marketable securities and (c) Unfunded
Margin Amount shall not be not less than $10,000,000.
(v) No Default or Event of Default has occurred or is
continuing. [If any Default or Event of Default has occurred and is
continuing, Seller shall describe the same in reasonable detail and
describe the action the Seller has taken or proposes to take with
respect thereto.]
(vi) Attached hereto as Schedule 1 is a true and correct list
of all Mortgage Loans purchased by Buyer and held by the Custodian
pending repurchase.
Exh. F-1
IN WITNESS WHEREOF, I have set my hand this _____ day of ________, ________.
By:______________________________________
Name:____________________________________
Title:___________________________________
Exh. F-2
EXHIBIT G
---------
FORM OF SERVICER NOTICE
[Date]
[________________], as Servicer
[ADDRESS]
Attention: ___________
Re: Master Repurchase Agreement, dated as of [______ __], 200[__]
(the "Repurchase Agreement"), between Anthracite Capital, Inc.
(the "Seller") and ▇▇▇▇▇▇ Commercial Paper Inc. (the "Buyer").
Ladies and Gentlemen:
[___________________] (the "Servicer") is servicing certain assets for Seller
pursuant to that certain Servicing Agreement between the Servicer and Seller.
Pursuant to the Repurchase Agreement between Buyer and Seller, the Servicer is
hereby notified that Seller has pledged to Buyer certain assets which are
serviced by Servicer which are subject to a security interest in favor of Buyer.
Seller hereby instructs Servicer to remit the Income (as defined in the
Repurchase Agreement) from the assets which are then subject to a Transaction
under the Repurchase Agreement (the "Purchased Assets") into that certain
account, Account No: [ ] in the name of the Seller for the benefit of Buyer as
its interests may appear, with ▇▇▇▇▇ Fargo Bank, National Association, ABA #[ ],
subject to the security interest of the Buyer pursuant to the Repurchase
Agreement.
Upon receipt of a Notice of Event of Default from Buyer, the Servicer shall
segregate all amounts collected on account of such Purchased Assets, hold them
in trust for the sole and exclusive benefit of Buyer, and remit such collections
in accordance with Buyer's written instructions. Following such Notice of Event
of Default, Servicer shall follow the instructions of Buyer with respect to the
Purchased Assets, and shall deliver to Buyer any information with respect to the
Purchased Assets reasonably requested by Buyer.
Notwithstanding any contrary information which may be delivered to the Servicer
by Seller, the Servicer may conclusively rely on any information or Notice of
Event of Default delivered by Buyer, and Seller shall indemnify and hold the
Servicer harmless for any and all claims asserted against it for any actions
taken in good faith by the Servicer in connection with the delivery of such
information or Notice of Event of Default.
This instruction letter is irrevocable absent the prior written consent of Buyer
and may not be amended, modified or rescinded without the prior written consent
of Buyer.
G-1
Please acknowledge receipt of this instruction letter by signing in the
signature block below and forwarding an executed copy to Buyer promptly upon
receipt. Any notices to Buyer should be delivered to the following addresses:
▇▇▇▇▇▇ Commercial Paper, Inc., ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention: ▇▇▇▇▇ ▇▇▇▇▇, Telecopier No.: ▇▇▇.▇▇▇.▇▇▇▇, Telephone No.:
▇▇▇.▇▇▇.▇▇▇▇.
Very truly yours,
Anthracite Capital Inc.
By:_______________________________________
Name:
Title:
ACKNOWLEDGED:
------------
Midland Loan Services, Inc.,
as Servicer
By: ________________________________________________
Title:
Telephone:
Facsimile:
G-2
EXHIBIT H
---------
FORM OF SECTION 7 CERTIFICATE
Reference is hereby made to the Repurchase Agreement dated as of [
], 200[ ] (as amended, restated, supplemented or otherwise modified from time
to time, the "Agreement"), between Anthracite Capital, Inc. (the "Seller") and
▇▇▇▇▇▇ Commercial Paper, Inc. (the "Buyer"). Pursuant to the provisions of
Section 7 of the Agreement, the undersigned hereby certifies that:
1. It is a ___ natural individual person, ____ treated as a
corporation for U.S. federal income tax purposes, ____
disregarded for federal income tax purposes (in which case a
copy of this Section 7 Certificate is attached in respect of
its sole beneficial owner), or ____ treated as a partnership
for U.S. federal income tax purposes (one must be checked).
2. It is the beneficial owner of amounts received pursuant to the
Agreement.
3. It is not a bank, as such term is used in section 881(c)(3)(A)
of the Internal Revenue Code of 1986, as amended (the "Code"),
or the Agreement is not, with respect to the undersigned, a
loan agreement entered into in the ordinary course of its trade
or business, within the meaning of such section.
4. It is not A-10-percent shareholder of the Seller within the
meaning of section 871(h)(3) or 881(c)(3)(B) of the Code.
5. It is not a controlled foreign corporation that is related to
the Seller within the meaning of section 881(c)(3)(C) of the
Code.
6. Amounts paid to it under the Facility Documents are not
effectively connected with its conduct of a trade or business
in the United States.
[NAME OF UNDERSIGNED]
By:__________________________________
Title:_______________________________
Date: _______________, ______
H-1
EXHIBIT I
---------
RESERVED
I-1
EXHIBIT J
---------
Reserved
J-1
1._______
K-2
EXHIBIT K
---------
FORM OF PURCHASE CONFIRMATION
▇▇▇▇▇▇ BROTHERS
May 1, 2007
Settlement Statement
Blackrock, Inc.
Park Avenue Plaza
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇ / ▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇-▇▇▇-▇▇▇▇ / ▇▇▇-▇▇▇-▇▇▇▇ (phone)
--------------------------------------------------------------------------------
Advance Summary:
---------------
Asset Name:
Face Value
Current ▇▇▇▇
Market Value
Advance Rate
Maximum Advance Amount
--------------------------------------------------------------------------------
Net Funding Summary:
-------------------
Requested Funding Amount
less:
less:
Netted Expenses (USD)
Spot Exchange Rate: USD ==> EURO
Netted Expenses (EURO)
Amount to be Wired from ▇▇▇▇▇▇ to Credit Suisse
--------------------------------------------------------------------------------
K-1
Financing Summary:
----------------
Base Rate Period:
Base Rate Percentage: [ ]%
Base Rate Start / End Date: [ ] [ ]
Financing Cost Due: [ ]
Financing Cost Due Date: [ ]
--------------------------------------------------------------------------------
Wire Instructions for ▇▇▇▇▇▇ Brothers
Contact at ▇▇▇▇▇▇ Brothers
K-2
EXHIBIT L
---------
FORM OF TRANSACTION REQUEST
May 1, 2007
▇▇▇▇▇▇ Commercial Paper, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇
Telecopier No.: ▇▇▇.▇▇▇.▇▇▇▇
Telephone No.: ▇▇▇.▇▇▇.▇▇▇▇
Re: Master Repurchase Agreement dated as of May 1, 2007, as amended, (the
"Agreement") by and among ▇▇▇▇▇▇ Commercial Paper Inc. (the "Buyer") and
Anthracite Capital, Inc. (the "Seller").
Ladies and Gentlemen:
Pursuant to Section 3 of the Agreement, the Seller hereby requests that
the Buyer enter into a Transaction with the Buyer to purchase the Eligible Asset
listed on the Purchased Asset Schedule attached hereto as Annex 1 and as
classified below in accordance with the Agreement:
Eligible Asset Information
Asset Number/Identifier ________________________
Property Name ________________________
Name of Borrower ________________________
Asset Class: _____
Original Unpaid Principal Balance: $___________________
Current Unpaid Principal Balance: $___________________
Asset Value: $___________________
Purchase Price: $___________________
Pricing Rate: ___________________
In connection with this Transaction Request, the undersigned hereby
certifies that: (i) each of the conditions precedent set forth in the
Agreement has been satisfied as of the date hereof, or will be satisfied at
least one Business Day prior to the proposed Purchase Date.
L-1
With respect to the representations and warranties of the Seller made
pursuant to Section 11 of the Agreement and Schedule 1 thereto, the Seller
hereby informs the Buyer of the exceptions to such representations and
warranties, if any, set forth on Annex 3 hereto.
L-2
All capitalized terms used herein but not otherwise defined shall
have the meanings specified in the Agreement. The Agreement is incorporated by
reference into this Transaction Request, and is made a part hereof as if it
were fully set forth herein and as evidenced hereby until all amounts due in
connection with this Transaction are paid in full.
Anthracite Capital Inc.
By:__________________________________
Name:
Title:
L-3
PURCHASED ASSET SCHEDULE(1)
-------------- ----------- ------------- ------------ -------- -------- ------------ ------------ --------------- --------------
Original Current
Principal Principal
Proposed Amount of Amount of
Property Name of Purchase Asset Asset Eligible Eligible Anticipated
Loan Number Name Borrower Date Class Type Asset Asset Asset Value Pricing Rate
-------------- ----------- ------------- ------------ -------- -------- ------------ ------------ --------------- --------------
-------------- ----------- ------------- ------------ -------- -------- ------------ ------------ --------------- --------------
(table continued)
-------------- -------------- ------------- ------------- ---------------
Purchase Requested Requested Requested
Price Purchase Repurchase Repurchase
Loan Number Percentage Price Date Date, if any
-------------- -------------- ------------- ------------- ---------------
-------------- -------------- ------------- ------------- ---------------
L-1
EXHIBIT M
---------
FORM OF SERVICING REPORT
1. Loan Number
2. Position
3. Borrower Name
4. UPB
5. Late Charge Balance
6. Next Payment Date
7. Current DSCR March 31, 200[ ]
8. Identified Problems with Servicer's Inspections
9. Tenant Occupying > 25% has vacated
10. Borrower, or affiliate, subject to Bankruptcy
11. If Yes to Bankruptcy, provide details
12. Maturity Date
13. Asset subject to Litigation
14. Interest Reserves Balance
15. Subject to Significant Covenant Violation
16. Material Defaults
17. Material Damage to Property
18. Borrower is 30 days or more Delinquent on Payment
19. Minimum Escrow Pmts/Balances have not been remitted or maintained
20. Criteria Requiring creation of springing Lockbox has occurred
21. Comments
M-1