EXECUTION COPY
SUPPLEMENTAL AGREEMENT
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This Supplemental Agreement (this "Agreement"), is dated and effective
as of January 25, 2002, between GMAC Commercial Mortgage Corporation as seller
(the "Seller") and German American Capital Corporation as purchaser (the
"Purchaser").
WHEREAS, the Seller sold certain mortgage loans as shown on Part I of
Exhibit A to the Purchaser pursuant to a certain Mortgage Loan Purchase
Agreement, dated as of ▇▇▇▇▇ ▇▇, ▇▇▇▇ (▇▇▇ "▇▇▇▇ Purchase Agreement").
WHEREAS, the Seller sold a pool of certain mortgage loans (the "GSMC
Warehouse Mortgage Loans") to ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Company ("GSMC") pursuant
to a certain Mortgage Loan Purchase Agreement, dated as of March 29, 2001 (the
"GSMC Purchase Agreement").
WHEREAS, the Purchaser purchased one of the GSMC Warehouse Mortgage
Loans from GSMC as shown on Part II of Exhibit A (the "GSMC/GACC Mortgage Loan")
from GSMC pursuant to a ▇▇▇▇ of Sale dated December 12, 2001 (the "▇▇▇▇ of
Sale"). Pursuant to the ▇▇▇▇ of Sale, the Seller and the Purchaser agreed that
the GSMC/GACC Mortgage Loan would be made subject to the GACC Purchase Agreement
and treated as a "Mortgage Loan" for the purposes thereof.
WHEREAS, the Purchaser intends to sell the mortgage loans as shown on
Exhibit A hereto (the "Mortgage Loans") to GMAC Commercial Mortgage Securities,
Inc. as Depositor, (the "Depositor") pursuant to a certain Mortgage Loan
Purchase Agreement, dated as of January 25, 2002 (the "Mortgage Loan Purchase
Agreement") and the Depositor intends to transfer the Mortgage Loans, together
with other multifamily and commercial mortgage loans, to a trust fund (the
"Trust Fund") to be formed by the Depositor, beneficial ownership of which will
be evidenced by a series of mortgage pass-through certificates (the
"Certificates"). Certain classes of the Certificates will be rated by ▇▇▇▇▇'▇
Investors Service, Inc. and Standard & Poor's Ratings Services, a division of
the ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc. (together, the "Rating Agencies"). Certain
classes of the Certificates (the "Registered Certificates") will be registered
under the Securities Act of 1933, as amended (the "Securities Act"). The Trust
Fund will be created and the Certificates will be issued pursuant to a pooling
and servicing agreement to be dated as of February 1, 2002 (the "Pooling and
Servicing Agreement"), among the Depositor as depositor, GMAC Commercial
Mortgage Corporation as master servicer (in such capacity, the "Master
Servicer") and special servicer and ▇▇▇▇▇ Fargo Bank Minnesota, N.A., as trustee
(in such capacity, the "Trustee"). Capitalized terms not otherwise defined
herein have the meanings assigned to them in the Pooling and Servicing Agreement
as in effect on the Closing Date (as defined below).
WHEREAS, the Depositor intends to sell the Class A-1, Class A-2, Class
B, Class C, Class D and Class E Certificates to ▇▇▇▇▇▇▇, Sachs & Co. and
Deutsche Banc Alex. ▇▇▇▇▇ Inc. (together, the "Underwriters"), pursuant to an
underwriting agreement dated the date hereof (the "Underwriting Agreement"). The
Depositor intends to sell the Class X-1, Class X-2, Class F, Class G and Class H
Certificates to ▇▇▇▇▇▇▇, Sachs & Co. and Deutsche Banc Alex. ▇▇▇▇▇ Inc. (in such
capacity, each an "Initial Purchaser") and Class J, Class K, Class L, Class M,
Class N,
Class O and Class P Certificates to Deutsche Banc Alex. ▇▇▇▇▇ Inc. (in such
capacity, an "Initial Purchaser") pursuant to two certificate purchase
agreements, each dated the date hereof (the "Certificate Purchase Agreements").
The Depositor intends to sell the Class R-I, Class R-II and Class R-III
Certificates to First Union National Bank (in such capacity, an "Initial
Purchaser").
WHEREAS, each of the Seller and the Purchaser, in connection with the
transaction described above, desires to amend and supplement certain of the
provisions of the GACC Purchase Agreement as it relates to the Mortgage Loans in
order to facilitate such transaction and in contemplation of the assignment by
the Purchaser to the Depositor of all of its right, title and interest in and to
this Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements set forth herein, the parties agree as follows:
SECTION 1. Amendment of GACC Purchase Agreement.
The parties hereto agree that, with respect to the Mortgage Loans only,
the GACC Purchase Agreement is hereby amended to the extent that the provisions
of such GACC Purchase Agreement are inconsistent with this Agreement.
SECTION 2. Representations, Warranties and Covenants of the Seller.
(a) The Seller hereby makes, as of February 5, 2002 (the "Closing
Date") (or as of such other date specifically provided in the particular
representation or warranty), to and for the benefit of the Purchaser, and its
successors and assigns (including, without limitation, the Depositor, the
Trustee and the holders of the Certificates), each of the representations and
warranties set forth in Exhibit B, with such changes or modifications as may be
permitted or required by the Rating Agencies.
(b) In addition, the Seller, as of the date hereof, hereby represents
and warrants to, and covenants with, the Purchaser that:
(i) The Seller is a corporation, duly organized, validly
existing and in good standing under the laws of the State of California, and is
in compliance with the laws of each State in which any Mortgaged Property is
located to the extent necessary to ensure the enforceability of each Mortgage
Loan and to perform its obligations under this Agreement.
(ii) The execution and delivery of this Agreement by the
Seller, and the performance and compliance with the terms of this Agreement by
the Seller, will not violate the Seller's organizational documents or constitute
a default (or an event which, with notice or lapse of time, or both, would
constitute a default) under, or result in the breach of, any material agreement
or other instrument to which it is a party or which is applicable to it or any
of its assets, in each case which materially and adversely affects the ability
of the Seller to carry out the transactions contemplated by this Agreement.
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(iii) The Seller has the full power and authority to enter
into and consummate all transactions contemplated by this Agreement, has duly
authorized the execution, delivery and performance of this Agreement, and has
duly executed and delivered this Agreement.
(iv) This Agreement, assuming due authorization, execution
and delivery by the Purchaser, constitutes a valid, legal and binding obligation
of the Seller, enforceable against the Seller in accordance with the terms
hereof, subject to (A) applicable bankruptcy, insolvency, reorganization,
moratorium and other laws affecting the enforcement of creditors' rights
generally, (B) general principles of equity, regardless of whether such
enforcement is considered in a proceeding in equity or at law, and (C) public
policy considerations underlying the securities laws, to the extent that such
public policy considerations limit the enforceability of the provisions of this
Agreement that purport to provide indemnification for securities laws
liabilities.
(v) The Seller is not in violation of, and its execution and
delivery of this Agreement and its performance and compliance with the terms of
this Agreement will not constitute a violation of, any law, any order or decree
of any court or arbiter, or any order, regulation or demand of any federal,
state or local governmental or regulatory authority, which violation, in the
Seller's good faith and reasonable judgment, is likely to affect materially and
adversely either the ability of the Seller to perform its obligations under this
Agreement or the financial condition of the Seller.
(vi) No litigation is pending with regard to which the
Seller has received service of process or, to the best of the Seller's
knowledge, threatened against the Seller the outcome of which, in the Seller's
good faith and reasonable judgment, could reasonably be expected to prohibit the
Seller from entering into this Agreement or materially and adversely affect
either the ability of the Seller to perform its obligations under this Agreement
or the financial condition of the Seller.
(vii) The Seller has not dealt with any broker, investment
banker, agent or other person, other than the Purchaser, the Underwriters, the
Initial Purchasers and their respective affiliates, that may be entitled to any
commission or compensation in connection with the sale of the Mortgage Loans or
the consummation of any of the other transactions contemplated hereby.
(viii) No consent, approval, authorization or order of,
registration or filing with, or notice to, any governmental authority or court
is required, under federal or state law (including, with respect to any bulk
sale laws), for the execution, delivery and performance of or compliance by the
Seller with this Agreement, or the consummation by the Seller of any transaction
contemplated hereby, other than (1) such consents, approvals, authorizations,
qualifications, registrations, filings or notices as have been obtained or made
and (2) where the lack of such consent, approval, authorization, qualification,
registration, filing or notice would not have a material adverse effect on the
performance by the Seller under this Agreement.
(c) Upon discovery by any of the parties hereto of a breach of any of
the representations and warranties made pursuant to and set forth in subsection
(b) above which materially and adversely affects the interests of the Purchaser
or its successors or assigns or a breach of any of the representations and
warranties made pursuant to subsection (a) above and
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set forth in Exhibit B which materially and adversely affects the value of any
Mortgage Loan or the interests therein of the Purchaser or its successors and
assigns (including, without limitation the Depositor, the Trustee and the
holders of the Certificates), the party discovering such breach shall give
prompt written notice to the other party hereto or if this Agreement has been
assigned by the Purchaser, to such assignee. The representations, warranties and
covenants set forth in Section 2(a) shall, as between the Seller and the
Purchaser, supplement, and as between the Seller and any successors or assigns
of the Purchaser, replace and amend and restate in their entirety, the
representations, warranties and covenants of the Seller made pursuant to Section
4.1(a) of the GACC Purchase Agreement to the extent they relate to the Mortgage
Loans.
SECTION 3. Representations, Warranties and Covenants of the Purchaser.
(a) The Purchaser, as of the date hereof, hereby represents and
warrants to, and covenants with, the Seller that:
(i) The Purchaser is a corporation duly organized, validly
existing and in good standing under the laws of the State of Maryland.
(ii) The execution and delivery of this Agreement by the
Purchaser, and the performance and compliance with the terms of this Agreement
by the Purchaser, will not violate the Purchaser's organizational documents or
constitute a default (or an event which, with notice or lapse of time, or both,
would constitute a default) under, or result in the breach of, any material
agreement or other instrument to which it is a party or which is applicable to
it or any of its assets, in each case which materially and adversely affects the
ability of the Purchaser to carry out the transactions contemplated by this
Agreement.
(iii) The Purchaser has the full power and authority to
enter into and consummate all transactions contemplated by this Agreement, has
duly authorized the execution, delivery and performance of this Agreement, and
has duly executed and delivered this Agreement.
(iv) This Agreement, assuming due authorization, execution
and delivery by the Seller, constitutes a valid, legal and binding obligation of
the Purchaser, enforceable against the Purchaser in accordance with the terms
hereof, subject to (A) applicable bankruptcy, insolvency, reorganization,
moratorium and other laws affecting the enforcement of creditors' rights
generally, (B) general principles of equity, regardless of whether such
enforcement is considered in a proceeding in equity or at law, and (C) public
policy considerations underlying the securities laws, to the extent that such
public policy considerations limit the enforceability of the provisions of this
Agreement that purport to provide indemnification for securities laws
liabilities.
(v) The Purchaser is not in violation of, and its execution
and delivery of this Agreement and its performance and compliance with the terms
of this Agreement will not constitute a violation of, any law, any order or
decree of any court or arbiter, or any order, regulation or demand of any
federal, state or local governmental or regulatory authority, which violation,
in the Purchaser's good faith and reasonable judgment, is likely to affect
materially
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and adversely either the ability of the Purchaser to perform its obligations
under this Agreement or the financial condition of the Purchaser.
(vi) No litigation is pending or, to the best of the
Purchaser's knowledge, threatened against the Purchaser which would prohibit the
Purchaser from entering into this Agreement or, in the Purchaser's good faith
and reasonable judgment, is likely to materially and adversely affect either the
ability of the Purchaser to perform its obligations under this Agreement or the
financial condition of the Purchaser.
(vii) The Purchaser has not dealt with any broker,
investment banker, agent or other person, other than the Seller, the
Underwriters, the Initial Purchasers and their respective affiliates, that may
be entitled to any commission or compensation in connection with the sale of the
Mortgage Loans or the consummation of any of the transactions contemplated
hereby.
(viii) No consent, approval, authorization or order of,
registration or filing with, or notice to, any governmental authority or court
is required, under federal or state law, for the execution, delivery and
performance of or compliance by the Purchaser with this Agreement, or the
consummation by the Purchaser of any transaction contemplated hereby, other than
(1) such consents, approvals, authorizations, qualifications, registrations,
filings or notices as have been obtained or made and (2) where the lack of such
consent, approval, authorization, qualification, registration, filing or notice
would not have a material adverse effect on the performance by the Purchaser
under this Agreement.
(b) The Purchaser hereby makes, as of the Closing Date (or as of such
other date specifically provided in the particular representation or warranty),
to and for the benefit of the Seller, and its successors and assigns, with
respect to each Mortgage Loan each of the representations and warranties set
forth below:
(i) Immediately prior to the transfer thereof to the
Depositor, the Purchaser had whatever title to such Mortgage Loan as was
conveyed to it by Seller (or GSMC, in the case of the GACC/GSMC Mortgage Loan)
free and clear of any and all liens, encumbrances and other interests on, in or
to such Mortgage Loan (other than, in certain cases, the right of a third party
servicer to directly service such Mortgage Loan) created by the Purchaser. Such
transfer validly assigns such title to such Mortgage Loan to the Depositor free
and clear of any pledge, lien, encumbrance or security interest created by the
Purchaser;
(ii) The Purchaser has full right and authority to sell,
assign and transfer its interest in such Mortgage Loan;
(iii) The Purchaser has not done anything that would
materially impair the coverage under the lender's title insurance policy that
insures the lien of the related Mortgage;
(iv) The Purchaser has not waived any material default,
breach, violation or event of acceleration existing under the related Mortgage
or Mortgage Note;
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(v) To the Purchaser's actual knowledge, without independent
inquiry as to the provisions of the Mortgage Loans, there is no valid offset,
defense or counterclaim to such Mortgage Loan arising out of the Purchaser's
actions or holding of the Mortgage Loans; and
(vi) The terms of the related Mortgage and the Mortgage Note
have not been impaired, waived, altered or modified by the Purchaser in any
material respect, except as specifically set forth in the related Mortgage File;
provided that, with respect to the representations and warranties in clauses
(iii), (iv), (v) and (vi) above, such representations and warranties cover only
actions taken directly by the Purchaser and its Affiliates or taken by the
Seller at the direction of the Purchaser.
(c) Upon discovery by any of the parties hereto of a breach of any of
the representations and warranties set forth above which materially and
adversely affects the interests of the Seller, the party discovering such breach
shall give prompt written notice to the other party hereto.
SECTION 4. Repurchases.
(a) Within 90 days of the earlier of discovery or receipt of notice by
the Seller, from either the Purchaser or any successor or assign thereof, of a
Defect (as defined in the Pooling and Servicing Agreement as in effect on the
Closing Date) in respect of the Mortgage File for any Mortgage Loan or a breach
of any representation or warranty made pursuant to Section 2(a) and set forth in
Exhibit B (a "Breach"), which Defect or Breach, as the case may be, materially
and adversely affects the value of any Mortgage Loan or the interests therein of
the Purchaser or its successors and assigns (including, without limitation, the
Depositor, the Trustee and the holders of the Certificates), the Seller shall
cure such Defect or Breach, as the case may be, in all material respects or
repurchase the affected Mortgage Loan from the then owner(s) thereof at the
applicable Purchase Price (as defined in the Pooling and Servicing Agreement as
in effect on the Closing Date) by payment of such Purchase Price by wire
transfer of immediately available funds to the account designated by such
owner(s); provided, however, that in lieu of effecting any such repurchase, the
Seller will be permitted to deliver a Qualifying Substitute Mortgage Loan and to
pay a cash amount equal to the applicable Substitution Shortfall Amount, subject
to the terms and conditions of the Pooling and Servicing Agreement as in effect
on the Closing Date.
If the Seller is notified of a Defect in any Mortgage File that
corresponds to information set forth in the Mortgage Loan Schedule, the Seller
shall promptly correct such Defect and provide a new, corrected Mortgage Loan
Schedule to the Purchaser or any successor or assign thereof, which corrected
Mortgage Loan Schedule shall be deemed to amend and replace the existing
Mortgage Loan Schedule for all purposes.
(b) Notwithstanding Section 4(a), within 60 days of the earlier of
discovery or receipt of notice by the Seller, from either the Purchaser or any
successor or assign thereof, that any Mortgage Loan does not constitute a
"qualified mortgage" within the meaning of Section 860G(a)(3) of the Code, the
Seller shall repurchase such Mortgage Loan from the then owner(s)
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thereof at the applicable Purchase Price by payment of such Purchase Price by
wire transfer of immediately available funds to the account designated by such
owner(s).
In addition, if, as of the Closing Date, any Mortgage Loan is secured
by a Mortgage that does not constitute a valid first lien upon the related
Mortgaged Property, including all buildings located thereon and all fixtures
attached thereto, or if a Mortgage is subject to something other than (A) the
lien of current real property taxes and assessments not yet due and payable, (B)
covenants, conditions and restrictions, rights of way, easements and other
matters of public record, (C) exceptions and exclusions specifically referred to
in the lender's title insurance policy issued or, as evidenced by a "marked-up"
commitment, to be issued in respect of such Mortgage Loan and (D) those
exceptions set forth on Schedule B-1 to Exhibit B hereto (the exceptions set
forth in the foregoing clauses (A), (B), (C) and (D) collectively, "Permitted
Encumbrances"), or if the insurer that issued the Title Policy referred to in
clause (vi) of Exhibit B hereto in respect of any Mortgage Loan was not
qualified to do business in the state in which the related Mortgaged Property is
located, and in either case such failure materially and adversely affects the
interests of holders of Certificates (any such failure that materially and
adversely affects the interests of holders of Certificates, also a "Breach"),
the Seller shall be required, at its option, to either (i) cure such Breach in
all material respects or (ii) repurchase the affected Mortgage Loan, in each
case, within the applicable Permitted Cure Period. If any such Breach is not
corrected or cured in all material respects within the applicable Permitted Cure
Period, the Seller shall, not later than the last day of such Permitted Cure
Period, (i) repurchase the affected Mortgage Loan from the Purchaser or its
assignee at the applicable Purchase Price or (ii) if within the three-month
period commencing on the Closing Date (or within the two-year period commencing
on the Closing Date if the related Mortgage Loan is a "defective obligation"
within the meaning of Section 860G(a)(4)(B)(ii) of the Code and Treasury
Regulation Section 1.860G-2(f)), at its option, replace such Mortgage Loan with
a Qualifying Substitute Mortgage Loan and pay any corresponding Substitution
Shortfall Amount. The Seller agrees that any such repurchase or substitution
shall be completed in accordance with and subject to the terms and conditions of
the Pooling and Servicing Agreement.
For purposes of the preceding paragraph only, the "Permitted Cure
Period" applicable to any Breach in respect of any Mortgage Loan shall be the
90-day period immediately following the earlier of the discovery by the Seller
or receipt by the Seller of notice of such Breach; provided that if such Breach
cannot be corrected or cured in all material respects within such 90-day period,
but it is reasonably likely that such Breach could be corrected or cured within
180 days of the earlier of discovery by the Seller and receipt by the Seller of
notice of such Breach, and the Seller is diligently attempting to effect such
correction or cure, then the applicable Permitted Cure Period shall, with the
consent of the Purchaser or its assignee (which consent shall not be
unreasonably withheld), be extended for an additional 90 days, unless (i) the
affected Mortgage Loan is in default and (ii) the applicable Breach constitutes
a Material Document Defect (as defined in the Pooling and Servicing Agreement)
other than a Material Document Defect resulting solely from a delay caused by
the public recording or filing office where documents have been sent for
recording or filing.
(c) In connection with any repurchase of or substitution for a
Mortgage Loan contemplated by this Section 4, the then owner(s) thereof shall
tender or cause to be tendered promptly to the Seller, upon delivery of a
receipt executed by the Seller, the related Mortgage File and Servicing File,
and each document that constitutes a part of the Mortgage
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File that was endorsed or assigned to the Purchaser or the Trustee shall be
endorsed or assigned, as the case may be, to the Seller or its designee in the
same manner. The form and sufficiency of all such instruments and certificates
shall be the responsibility of the Seller.
(d) This Section 4 provides the sole remedies available to the
Purchaser, and its successors and assigns (including, without limitation, the
Depositor, the Trustee and the holders of the Certificates) respecting any
Defect in a Mortgage File or any breach of any representation or warranty made
pursuant to Section 2(a) and set forth in Exhibit B, or in connection with the
circumstances described in Section 4(b). If the Seller defaults on its
obligations to repurchase or replace any Mortgage Loan in accordance with
Section 4(a) or 4(b) or disputes its obligation to repurchase or replace any
Mortgage Loan in accordance with either such subsection, the Purchaser or its
successors and assigns may take such action as is appropriate to enforce such
payment or performance, including, without limitation, the institution and
prosecution of appropriate proceedings. The Seller shall reimburse the Purchaser
for all necessary and reasonable costs and expenses incurred in connection with
such enforcement. The remedies provided in this Section 4 shall replace and
amend and restate in their entirety the provisions of Section 4.3 of the GACC
Purchase Agreement with respect to the Mortgage Loans.
(e) In the event that (i) any Mortgage Loan that is a
Cross-Collateralized Mortgage Loan (as defined in the Pooling and Servicing
Agreement) is required to be repurchased pursuant to this Section 4 as a result
of a Breach, Defect or other event, and (ii) the cross-collateralization
provisions of the related Cross-Collateralized Mortgage Loans cannot be released
to the extent required by Section 2.03 of the Pooling and Servicing Agreement to
permit repurchase of the affected Mortgage Loan within the time period specified
in this Agreement for such repurchase, the Seller shall repurchase the affected
Mortgage Loan and all of the related Cross-Collateralized Mortgage Loans not so
released.
SECTION 5. Conveyance of Mortgage Files.
(a) In connection with the Purchaser's assignment of the Mortgage
Loans to the Depositor pursuant to the Mortgage Loan Purchase Agreement, the
Purchaser hereby covenants with the Seller that, at least five (5) Business Days
before the Closing Date, it shall have delivered to and deposited with the
Trustee, the Mortgage File (as described on Exhibit B to the Mortgage Loan
Purchase Agreement) for each Mortgage Loan so assigned to the extent that such
Mortgage File was delivered to the Purchaser. In the event the Purchaser fails
to so deliver each such Mortgage File to the Trustee, the Seller and its
successors and assigns shall be entitled to pursue any rights or remedies in
respect of such failure as may be available under applicable law.
(b) In connection with the Seller's assignment of the Mortgage Loans
pursuant to the GACC Purchase Agreement and the GSMC Purchase Agreement, the
Seller hereby agrees that, to the extent any Mortgage Files (as described on
Exhibit B to the Mortgage Loan Purchase Agreement) in its possession and has not
been previously delivered and deposited with the Purchaser, the Seller hereby
covenants with the Purchaser that, at least five (5) Business Days before the
Closing Date, it shall have delivered to and deposited with the Trustee, such
Mortgage File. For the benefit of the Purchaser and its successors and assigns,
the Seller acknowledges and agrees that the Depositor intends to cause the
Trustee to perform a limited review of the
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Mortgage Files relating to the Mortgage Loans to enable the Trustee to
confirm to the Depositor on or before the Closing Date that the Mortgage Note
referred to in clause (i) of Exhibit B of the Mortgage Loan Purchase Agreement
has been delivered to the Trustee with respect to each such Mortgage File. If
the Seller cannot deliver, or cause to be delivered as to any Mortgage Loan, the
original Mortgage Note, the Seller shall deliver a copy or duplicate original of
such Mortgage Note, together with an affidavit certifying that the original
thereof has been lost or destroyed. If the Seller cannot deliver, or cause to be
delivered, as to any Mortgage Loan, the original or a copy of any of the
documents and/or instruments referred to in clauses (ii), (iv), (viii), (xi)(A)
and (xii) of Exhibit B of the Mortgage Loan Purchase Agreement, with evidence of
recording thereof, solely because of a delay caused by the public recording or
filing office where such document or instrument has been delivered for
recordation or filing, or because such original recorded document has been lost
or returned from the recording or filing office and subsequently lost, as the
case may be, the delivery requirements of this Section 5 shall be deemed to have
been satisfied as to such missing item, and such missing item shall be deemed to
have been included in the related Mortgage File, provided that a copy of such
document or instrument (without evidence of recording or filing thereon, but
certified (which certificate may relate to multiple documents and/or
instruments) by the Seller to be a true and complete copy of the original
thereof submitted for recording or filing, as the case may be) has been
delivered to the Trustee on or before the Closing Date, and either the original
of such missing document or instrument, or a copy thereof, with evidence of
recording or filing, as the case may be, thereon, is delivered to or at the
direction of the Depositor or Trustee within 180 days of the Closing Date (or
within such longer period after the Closing Date as the Trustee (or such
subsequent owner) may consent to, which consent shall not be unreasonably
withheld so long as the Seller has provided the Depositor or Trustee with
evidence of such recording or filing, as the case may be, or has certified to
the Depositor or Trustee as to the occurrence of such recording or filing, as
the case may be, and is, as certified to the Trustee no less often than
quarterly, in good faith attempting to obtain from the appropriate county
recorder's or filing office such original or copy).
(c) If the Seller cannot deliver, or cause to be delivered, as to any
Mortgage Loan, the original or a copy of the related lender's title insurance
policy referred to in clause (ix) of Exhibit B of the Mortgage Loan Purchase
Agreement solely because such policy has not yet been issued, the delivery
requirements of this Section 5 shall be deemed to be satisfied as to such
missing item, and such missing item shall be deemed to have been included in the
related Mortgage File, provided that the Seller has delivered to the Trustee, on
or before the Closing Date, a commitment for title insurance "marked-up" at the
closing of such Mortgage Loan, and the Seller shall deliver to or at the
direction of the Depositor or Trustee, promptly following the receipt thereof,
the original related lender's title insurance policy (or a copy thereof). In
addition, notwithstanding anything to the contrary contained herein, if there
exists with respect to any group of related cross-collateralized Mortgage Loans
only one original of any document referred to in Exhibit B of the Mortgage Loan
Purchase Agreement covering all the Mortgage Loans in such group, then the
inclusion of the original of such document in the Mortgage File for any of the
Mortgage Loans in such group shall be deemed an inclusion of such original in
the Mortgage File for each such Mortgage Loan.
(d) As to each Mortgage Loan, the Seller, at its own cost, shall be
responsible for (i) the recording or filing, as the case may be, of each
assignment referred to in clauses (iii) and (v)
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of Exhibit B to the Mortgage Loan Agreement and each UCC-2 and UCC-3, if any,
referred to in clause (xi)(B) of Exhibit B to the Mortgage Loan Purchase
Agreement and (ii) the delivery of a copy of any such document or instrument to
the Master Servicer promptly following its return to the Trustee or its designee
after such recording or filing. If any such document or instrument is lost or
returned unrecorded or unfiled, as the case may be, because of a defect therein,
the Seller shall promptly prepare or cause the preparation of a substitute
therefor or cure or cause the curing of such defect, as the case may be, and
shall thereafter deliver the substitute or corrected document to or at the
direction of the Depositor or (or any subsequent owner of the affected Mortgage
Loan, including without limitation the Trustee) for recording or filing, as
appropriate, at the Seller's expense.
SECTION 6. Representations, Warranties and Agreements to Survive
Delivery.
All representations, warranties and agreements contained in this
Agreement, incorporated herein by reference or contained in the certificates of
officers of the Seller submitted pursuant hereto, shall remain operative and in
full force and effect and shall survive delivery of the Mortgage Loans by the
Seller to the Purchaser or its designee.
SECTION 7. Costs.
Costs relating to the transactions contemplated hereby and in the
Mortgage Loan Purchase Agreement shall be borne by the Seller.
SECTION 8. Indemnification.
(a) The Purchaser (the "Indemnifying Party") agrees to indemnify and
hold harmless the Seller against any and all losses, claims, damages or
liabilities, joint or several, to which it may become subject insofar as such
losses, claims, damages or liabilities (or actions in respect thereto) arise out
of or are based upon the breach of any of the Purchaser's representations or
warranties contained in Section 3(b) of this Agreement. This indemnity will be
in addition to any liability which the Purchaser may otherwise have.
(b) The indemnity agreement contained in this Section 8 shall remain
operative and in full force and effect regardless of (i) any termination of this
Agreement, or (ii) any investigation made by any indemnified party.
SECTION 9. Severability of Provisions.
Any part, provision, representation, warranty or covenant of this
Agreement that is prohibited or which is held to be void or unenforceable shall
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof. Any part, provision,
representation, warranty or covenant of this Agreement that is prohibited or
unenforceable or is held to be void or unenforceable in any particular
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
particular jurisdiction shall not invalidate or render unenforceable such
provision in any other
10
jurisdiction. To the extent permitted by applicable law, the parties hereto
waive any provision of law which prohibits or renders void or unenforceable any
provision hereof.
SECTION 10. Counterparts.
This Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original, but all of which together shall
constitute one and the same instrument.
SECTION 11. GOVERNING LAW.
THIS AGREEMENT AND THE RIGHTS, DUTIES, OBLIGATIONS AND RESPONSIBILITIES
OF THE PARTIES HERETO SHALL BE GOVERNED IN ACCORDANCE WITH THE INTERNAL LAWS AND
DECISIONS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES
EXCEPT THAT THE PARTIES HERETO INTEND THAT THE PROVISIONS OF SECTION 5-1401 OF
THE NEW YORK GENERAL OBLIGATIONS LAW SHALL APPLY TO THIS AGREEMENT.
SECTION 12. Further Assurances.
The Seller and the Purchaser agree to execute and deliver such
instruments and take such further actions as the other party may, from time to
time, reasonably request in order to effectuate the purposes and to carry out
the terms of this Agreement.
SECTION 13. Successors and Assigns.
The rights and obligations of the Seller under this Agreement shall not
be assigned by the Seller without the prior written consent of the Purchaser,
except that any person into which the Seller may be merged or consolidated, or
any corporation or other entity resulting from any merger, conversion or
consolidation to which the Seller is a party, or any person succeeding to all or
substantially all of the business of the Seller, shall be the successor to the
Seller hereunder. The Purchaser and its assignee have the right to assign its
interest under this Agreement, in whole or in part. Subject to the foregoing,
this Agreement shall bind and inure to the benefit of and be enforceable by the
Seller and the Purchaser, and their permitted successors and assigns.
SECTION 14. Amendments.
No term or provision of this Agreement may be amended, waived, modified
or in any way altered, unless such amendment, waiver, modification or alteration
is in writing and signed by a duly authorized officer of the party against whom
such amendment, waiver, modification or alteration is sought to be enforced.
11
IN WITNESS WHEREOF, the parties hereto have caused their names to be
signed hereto by their respective duly authorized officers as of the date first
above written.
GMAC COMMERCIAL MORTGAGE CORPORATION
By: _____________________________
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President
GERMAN AMERICAN CAPITAL CORPORATION
By: _____________________________
Name:
Title:
By: _____________________________
Name:
Title:
12
EXHIBIT A
MORTGAGE LOAN SCHEDULE
PART I [GACC WAREHOUSE LOANS]
PART II [GACC/GSMC MORTGAGE LOAN]
A-1
EXHIBIT B
REPRESENTATIONS AND WARRANTIES OF THE SELLER
REGARDING THE INDIVIDUAL MORTGAGE LOANS
With respect to each Mortgage Loan, the Seller hereby represents and warrants,
as of the date herein below specified or, if no such date is specified, as of
the Closing Date, except as set forth on Schedule B-1 hereto, that:
(i) Ownership of Mortgage Loans. Immediately prior to the
transfer thereof to the Purchaser (or GSMC, pursuant to the GSMC Purchase
Agreement, in the case of the GACC/GSMC Mortgage Loan), the Seller had good and
marketable title to, and was the sole owner and holder of, such Mortgage Loan
free and clear of any and all liens, encumbrances and other interests on, in or
to such Mortgage Loan (other than, in certain cases, the right of a subservicer
to directly service such Mortgage Loan). Such transfer validly assigns ownership
of such Mortgage Loan to the Purchaser free and clear of any pledge, lien,
encumbrance or security interest.
(ii) Authority to Transfer Mortgage Loans. The Seller has and
had full right and authority to sell, assign and transfer such Mortgage Loan to
the Purchaser (or to GSMC, pursuant to the GSMC Purchase Agreement, in the case
of the GACC/GSMC Mortgage Loan). No provision of the Mortgage Note, Mortgage or
other loan document relating to such Mortgage Loan prohibits or prohibited or
restricts or restricted the Seller's right to assign or transfer such Mortgage
Loan.
(iii) Mortgage Loan Schedule. The information pertaining to
such Mortgage Loan set forth in the Mortgage Loan Schedule was true and correct
in all material respects as of the Cut-off Date.
(iv) Payment Record. Such Mortgage Loan was not as of the
Cut-off Date for such Mortgage Loan, and has not been during the twelve-month
period prior thereto, 30 days or more delinquent in respect of any debt service
payment required thereunder, without giving effect to any applicable grace
period.
(v) Permitted Encumbrances. The Permitted Encumbrances (as
defined in the Mortgage Loan Purchase Agreement of which this Exhibit B forms a
part) do not materially interfere with the security intended to be provided by
the related Mortgage, the current use or operation of the related Mortgaged
Property or the current ability of the Mortgaged Property to generate net
operating income sufficient to service the Mortgage Loan. If the Mortgaged
Property is operated as a nursing facility, a hospitality property or a
multifamily property, the Mortgage, together with any separate security
agreement, similar agreement and UCC financing statement, if any, establishes
and creates a first priority, perfected security interest (subject only to any
prior purchase money security interest), to the extent such security interest
can be perfected by the recordation of a Mortgage or the filing of a UCC
financing statement, in all personal property owned by the Mortgagor that is
used in, and is reasonably necessary to, the operation of the related Mortgaged
Property.
B-1
(vi) Title Insurance. The lien of the related Mortgage is
insured by an ALTA lender's title insurance policy ("Title Policy"), or its
equivalent as adopted in the applicable jurisdiction, issued by a nationally
recognized title insurance company, insuring the originator of such Mortgage
Loan, its successors and assigns, as to the first priority lien of the Mortgage
in the original principal amount of the Mortgage Loan after all advances of
principal, subject only to Permitted Encumbrances (or, if a title insurance
policy has not yet been issued in respect of the Mortgage Loan, a policy meeting
the foregoing description is evidenced by a commitment for title insurance
"marked-up" at the closing of such loan). Each Title Policy (or, if it has yet
to be issued, the coverage to be provided thereby) is in full force and effect,
all premiums thereon have been paid and, to the Seller's knowledge, no material
claims have been made thereunder and no claims have been paid thereunder. The
Seller has not, by act or omission, done anything that would materially impair
the coverage under such Title Policy. Immediately following the transfer and
assignment of the related Mortgage Loan to the Trustee, such Title Policy (or,
if it has yet to be issued, the coverage to be provided thereby) will inure to
the benefit of the Trustee without the consent of or notice to the insurer.
(vii) No Waivers by Seller of Material Defaults. The Seller
has not waived any material default, breach, violation or event of acceleration
existing under the related Mortgage or Mortgage Note.
(viii) No Offsets, Defenses or Counterclaims. There is no
valid offset, defense or counterclaim to such Mortgage Loan.
(ix) Condition of Property; Condemnation. Except as set forth
in any engineering report prepared in connection with the origination of (or
obtained in connection with or otherwise following the Seller's acquisition of)
such Mortgage Loan, the related Mortgaged Property is, to the Seller's
knowledge, free and clear of any damage that would materially and adversely
affect its value as security for such Mortgage Loan. The Seller has no actual
notice of the commencement of a proceeding for the condemnation of all or any
material portion of the related Mortgaged Property.
(x) Compliance with Usury Laws. Such Mortgage Loan complied
with all applicable usury laws in effect at its date of origination.
(xi) Full Disbursement of Mortgage Loan Proceeds. The proceeds
of such Mortgage Loan have been fully disbursed and there is no requirement for
future advances thereunder.
(xii) Enforceability. The related Mortgage Note and Mortgage
and all other documents and instruments evidencing, guaranteeing, insuring or
otherwise securing such Mortgage Loan have been duly and properly executed by
the parties thereto, and each is the legal, valid and binding obligation of the
maker thereof (subject to any non-recourse provisions contained in any of the
foregoing agreements and any applicable state anti-deficiency legislation),
enforceable in accordance with its terms, except as such enforcement may be
limited by bankruptcy, insolvency, reorganization, receivership, moratorium or
other laws relating to or affecting the rights of creditors generally and by
general principles of equity (regardless of whether such enforcement is
considered in a proceeding in equity or at law).
B-2
(xiii) Insurance. All improvements upon the related Mortgaged
Property are insured under an "all risk" insurance policy against loss by
hazards of extended coverage in an amount (subject to a customary deductible) at
least equal to the full insurable replacement cost of the improvements located
on such Mortgaged Property, which policy contains appropriate endorsements to
avoid the application of coinsurance and does not permit reduction in insurance
proceeds for depreciation. If any portion of the improvements upon the related
Mortgaged Property was, at the time of the origination of such Mortgage Loan, in
a flood zone area as identified in the Federal Register by the Federal Emergency
Management Agency as a 100 year flood zone or special hazard area, and flood
insurance was available, a flood insurance policy meeting any requirements of
the then current guidelines of the Federal Insurance Administration is in effect
with a generally acceptable insurance carrier, in an amount representing
coverage not less than the least of (1) the outstanding principal balance of
such Mortgage Loan, (2) the full insurable value of such Mortgaged Property, (3)
the maximum amount of insurance available under the National Flood Insurance Act
of 1968, as amended, or (4) 100% of the replacement cost of the improvements
located on such Mortgaged Property. In addition, the Mortgage requires the
Mortgagor to maintain in respect of the Mortgaged Property workers' compensation
insurance (if applicable), comprehensive general liability insurance in amounts
generally required by the Seller, and at least twelve months rental or business
interruption insurance, and all such insurance required by the Mortgage to be
maintained is in full force and effect. Each such insurance policy names the
holder of the Mortgage as an additional insured or contains a mortgagee
endorsement naming the holder of the Mortgage as loss payee and requires prior
notice to the holder of the Mortgage of termination or cancellation, and no such
notice has been received, including any notice of nonpayment of premiums, that
has not been cured.
(xiv) Environmental Condition. The related Mortgaged Property
was subject to one or more environmental site assessments (or an update of a
previously conducted assessment), which was (were) performed on behalf of the
Seller, or as to which the related report was delivered to the Seller in
connection with its origination or acquisition of such Mortgage Loan; and the
Seller, having made no independent inquiry other than reviewing the resulting
report(s) and/or employing an environmental consultant to perform the
assessment(s) referenced herein, has no knowledge of any material and adverse
environmental conditions or circumstance affecting such Mortgaged Property that
was not disclosed in the related report(s). The Seller has not taken any action
with respect to such Mortgage Loan or the related Mortgaged Property that could
subject the Purchaser, or its successors and assigns in respect of the Mortgage
Loan, to any liability under the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended ("CERCLA") or any other
applicable federal, state or local environmental law, and the Seller has not
received any actual notice of a material violation of CERCLA or any applicable
federal, state or local environmental law with respect to the related Mortgaged
Property that was not disclosed in the related report. The related Mortgage or
loan documents in the related Mortgage File require the Mortgagor to comply with
all applicable federal, state and local environmental laws and regulations. To
the extent an environmental insurance policy has been obtained with respect to a
Mortgage Loan, (i) the related environmental insurance policy is in full force
and effect, (ii) on the effective date of such environmental insurance policy,
the Seller, as originator, had no knowledge of any material and adverse
environmental condition or circumstance affecting the Mortgaged Property that
was not disclosed to the policy issuer in one or more of the following: (a) the
application for insurance, (b) a borrower questionnaire that was provided to the
policy issuer or (c) an environmental assessment, engineering or other report
B-3
provided to the policy issuer and (iii) the premiums on the environmental
insurance policy have been paid in full or the related loan documents provide
for payment of such premiums by the related Mortgagor or other responsible party
as the same shall be payable.
(xv) No Cross-Collateralization with Other Mortgage Loans.
Such Mortgage Loan is not cross-collateralized with any mortgage loan that will
not be included in the Trust Fund.
(xvi) Waivers and Modifications. The terms of the related
Mortgage and the Mortgage Note have not been impaired, waived, altered or
modified in any material respect, except as specifically set forth in the
related Mortgage File.
(xvii) Taxes and Assessments. There are no delinquent taxes,
ground rents, assessments for improvements or other similar outstanding charges
affecting the related Mortgaged Property which are or may become a lien of
priority equal to or higher than the lien of the related Mortgage. For purposes
of this representation and warranty, real property taxes and assessments shall
not be considered unpaid until the date on which interest and/or penalties would
be payable thereon.
(xviii) Mortgagor's Interest in Mortgaged Property. The
interest of the related Mortgagor in the related Mortgaged Property consists of
a fee simple interest in real property.
(xix) Whole Loan. Each Mortgage Loan is a whole loan and not a
participation interest.
(xx) Valid Assignment. The assignment of the related Mortgage
referred to in clause (iii) of Exhibit B of the Mortgage Loan Purchase Agreement
between German American Capital Corporation, as seller and GMAC Commercial
Mortgage Securities, Inc., as purchaser, dated, January 25, 2002, constitutes
the legal, valid and binding assignment of such Mortgage from the relevant
assignor to the Trustee. The Assignment of Leases set forth in the Mortgage or
separate from the related Mortgage and related to and delivered in connection
with each Mortgage Loan establishes and creates a valid, subsisting and, subject
only to Permitted Encumbrances, enforceable first priority lien and first
priority 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 subject to the
related Mortgage, and each assignor thereunder has the full right to assign the
same. The related assignment of any Assignment of Leases, not included in a
Mortgage, executed and delivered in favor of the Trustee is in recordable form
and constitutes a legal, valid and binding assignment, sufficient to convey to
the assignee named therein all of the assignor's right, title and interest in,
to and under such Assignment of Leases.
(xxi) Escrows. All escrow deposits relating to such Mortgage
Loan that are, as of the Closing Date, required to be deposited with the
mortgagee or its agent have been so deposited.
(xxii) No Mechanics' or Materialmen's Liens. As of the date of
origination of such Mortgage Loan and, to the actual knowledge of the Seller, as
of the Closing Date, the related Mortgaged Property was and is free and clear of
any mechanics' and materialmen's liens
B-4
or liens in the nature thereof which create a lien prior to that created by the
related Mortgage, except those which are insured against by the Title Policy
referred to in (vi) above.
(xxiii) No Material Encroachments. To the Seller's knowledge
(based on surveys and/or title insurance obtained in connection with the
origination of such Mortgage Loan), as of the date of such origination, no
improvement that was included for the purpose of determining the appraised value
of the related Mortgaged Property at the time of origination of such Mortgage
Loan lay outside the boundaries and building restriction lines of such property
to any material extent (unless affirmatively covered by the title insurance
referred to in paragraph (vi) above), and no improvements on adjoining
properties encroached upon such Mortgaged Property to any material extent. To
the Seller's knowledge, based upon opinions of counsel and/or other due
diligence customarily performed by the Seller, the improvements located on or
forming part of such Mortgaged Property comply in all material respects with
applicable zoning laws and ordinances (except to the extent that they may
constitute legal non-conforming uses).
(xxiv) Originator Authorized. To the extent required under
applicable law as of the Closing Date, the originator of such Mortgage Loan was
authorized to do business in the jurisdiction in which the related Mortgaged
Property is located at all times when it held the Mortgage Loan to the extent
necessary to ensure the enforceability of such Mortgage Loan.
(xxv) No Material Default. (A) To the Seller's knowledge,
there exists no material default, breach or event of acceleration under the
related Mortgage or Mortgage Note, and (B) the Seller has not received actual
notice of any event (other than payments due but not yet delinquent) that, with
the passage of time or with notice and the expiration of any grace or cure
period, would constitute such a material default, breach or event of
acceleration; provided, however, that this representation and warranty does not
cover any default, breach or event of acceleration that specifically pertains to
any matter otherwise covered or addressed by any other representation and
warranty made by the Seller herein.
(xxvi) Inspection. In connection with the origination or
acquisition of each Mortgage Loan, the Seller inspected or caused to be
inspected the Mortgaged Property.
(xxvii) No Equity Participation or Contingent Interest. The
Mortgage Loan contains no equity participation by the lender, and does not
provide for any contingent or additional interest in the form of participation
in the cash flow of the related Mortgaged Property, or for negative amortization
(except for hyper-amortization loans with respect to unpaid interest accruing
after the anticipated repayment date).
(xxviii) No Advances of Funds. No holder of the Mortgage Loan
has, to the Seller's knowledge, advanced funds or induced, solicited or
knowingly received any advance of funds from a party other than the owner of the
related Mortgaged Property, directly or indirectly, for the payment of any
amount required by the Mortgage Loan (other than amounts paid by the tenant as
specifically provided under the related lease).
(xxix) Licenses, Permits, Etc. To the Seller's knowledge,
based on due diligence customarily performed in the origination of comparable
mortgage loans by the Seller, as of the date of origination of the Mortgage
Loan, the related Mortgagor or operator of the related
B-5
Mortgaged Property was in possession of all material licenses, permits and
authorizations required by applicable laws for the ownership and operation of
the related Mortgaged Property as it was then operated.
(xxx) Servicing. The servicing and collection practices used
with respect to the Mortgage Loan have complied with applicable law in all
material respects and are consistent with the servicing standard set forth in
Section 3.01(a) of the Pooling and Servicing Agreement.
(xxxi) Customary Remedies. The related Mortgage or Mortgage
Note, together with applicable state law, contains customary and enforceable
provisions (subject to the exceptions set forth in paragraph (xii)) such as to
render the rights and remedies of the holders thereof adequate for the practical
realization against the related Mortgaged Property of the principal benefits of
the security intended to be provided thereby.
(xxxii) Insurance and Condemnation Proceeds. The related
Mortgage provides that insurance proceeds and condemnation proceeds will be
applied for one of the following purposes: either to restore or repair the
Mortgaged Property, or to repay the principal of the Mortgage Loan, or otherwise
at the option of the holder of the Mortgage.
(xxxiii) LTV. The gross proceeds of such Mortgage Loan to the
related Mortgagor at origination did not exceed the non-contingent principal
amount of the Mortgage Loan and either: (A) such Mortgage Loan is secured by an
interest in real property having a fair market value (1) at the date the
Mortgage Loan was originated at least equal to 80 percent of the original
principal balance of the Mortgage Loan or (2) at the Closing Date at least equal
to 80 percent of the principal balance of the Mortgage Loan on such date;
provided that for purposes hereof, the fair market value of the real property
interest must first be reduced by (X) the amount of any lien on the real
property interest that is senior to the Mortgage Loan and (Y) a proportionate
amount of any lien that is in parity with the Mortgage Loan (unless such other
lien secures a Mortgage Loan that is cross-collateralized with such Mortgage
Loan, in which event the computation described in clauses (1) and (2) of this
paragraph (xxxiii) shall be made on a pro rata basis in accordance with the fair
market values of the Mortgaged Properties securing such cross-collateralized
Mortgage Loans; or (B) substantially all the proceeds of such Mortgage Loan were
used to acquire, improve or protect the real property which served as the only
security for such Mortgage Loan (other than a recourse feature or other third
party credit enhancement within the meaning of Treasury Regulations Section
1.860G-2(a)(1)(ii)).
(xxxiv) LTV and Significant Modifications. If the Mortgage
Loan was "significantly modified" prior to the Closing Date so as to result in a
taxable exchange under Section 1001 of the Code, it either (A) was modified as a
result of the default or reasonably foreseeable default of such Mortgage Loan or
(B) satisfies the provisions of either clause (A)(1) of paragraph (xxxiii)
(substituting the date of the last such modification for the date the Mortgage
Loan was originated) or clause (A)(2) of paragraph (xxxiii), including the
proviso thereto.
(xxxv) Reserved.
B-6
(xxxvi) Litigation. To the Seller's actual knowledge, there
are no pending actions, suits or proceedings by or before any court or
governmental authority against or affecting the related Mortgagor or the related
Mortgaged Property that, if determined adversely to such Mortgagor or Mortgaged
Property, would materially and adversely affect the value of the Mortgaged
Property or the ability of the Mortgagor to pay principal, interest or any other
amounts due under such Mortgage Loan.
(xxxvii) Leasehold Estate. Each Mortgaged Property consists of
the related Mortgagor's fee simple interest in real estate or the related
Mortgage Loan is secured in whole or in part by the interest of the Mortgagor as
a lessee under a ground lease of the Mortgaged Property (a "Ground Lease"). Any
Mortgage Loan that is secured by the interest of the Mortgagor under a Ground
Lease may or may not be secured by the related fee interest in such Mortgaged
Property (the "Fee Interest"). If a Mortgage Loan is secured in whole or in part
by a Ground Lease, either (1) the ground lessor's Fee Interest is subordinated
to the lien of the Mortgage, (2) such Mortgage Loan is also secured by the
related fee interest or (3) the following apply to such Ground Lease:
(A) To the actual knowledge of the Seller, based on
due diligence customarily performed in the
origination of comparable mortgage loans by the
Seller, such Ground Lease or a memorandum thereof
has been or will be duly recorded; such Ground
Lease (or the related estoppel letter or lender
protection agreement between the Seller and
related lessor) permits the interest of the lessee
thereunder to be encumbered by the related
Mortgage; and there has been no material change in
the payment terms of such Ground Lease since the
origination of the related Mortgage Loan, with the
exception of material changes reflected in written
instruments that are a part of the related
Mortgage File;
(B) The lessee's interest in such Ground Lease is not
subject to any liens or encumbrances superior to,
or of equal priority with, the related Mortgage,
other than the ground lessor's related fee
interest and Permitted Encumbrances;
(C) The Mortgagor's interest in such Ground Lease is
assignable to the Purchaser and its successors and
assigns upon notice to, but without the consent
of, the lessor thereunder (or, if such consent is
required, it has been obtained prior to the
Closing Date) and, in the event that it is so
assigned, is further assignable by the Purchaser
and its successors and assigns upon notice to, but
without the need to obtain the consent of, such
lessor;
(D) Such Ground Lease is in full force and effect, and
the Seller has received no notice that an event of
default has occurred thereunder, and, to the
Seller's actual knowledge, there exists no
condition that, but for the passage of time or the
giving of notice, or both, would result in an
event of default under the terms of such Ground
Lease;
B-7
(E) Such Ground Lease, or an estoppel letter or other
agreement, requires the lessor under such Ground
Lease to give notice of any default by the lessee
to the mortgagee under such Mortgage Loan,
provided that the mortgagee under such Mortgage
Loan has provided the lessor with notice of its
lien in accordance with the provisions of such
Ground Lease, and such Ground Lease, or an
estoppel letter or other agreement, further
provides that no notice of termination given under
such Ground Lease is effective against the
mortgagee unless a copy has been delivered to the
mortgagee;
(F) The mortgagee under such Mortgage Loan is
permitted a reasonable opportunity (including,
where necessary, sufficient time to gain
possession of the interest of the lessee under
such Ground Lease) to cure any default under such
Ground Lease, which is curable after the receipt
of notice of any such default, before the lessor
thereunder may terminate such Ground Lease;
(G) Such Ground Lease has an original term (including
any extension options set forth therein) which
extends not less than ten years beyond the Stated
Maturity Date of the related Mortgage Loan;
(H) Under the terms of such Ground Lease and the
related Mortgage, taken together, any related
insurance proceeds will be applied either to the
repair or restoration of all or part of the
related Mortgaged Property, with the mortgagee
under such Mortgage Loan or a trustee appointed by
it having the right to hold and disburse such
proceeds as the repair or restoration progresses
(except in such cases where a provision entitling
another party to hold and disburse such proceeds
would not be viewed as commercially unreasonable
by a prudent commercial mortgage lender), or to
the payment of the outstanding principal balance
of the Mortgage Loan together with any accrued
interest thereon;
(I) Such Ground Lease does not impose any restrictions
on subletting which would be viewed, as of the
date of origination of the related Mortgage Loan,
as commercially unreasonable by the Seller; and
such Ground Lease contains a covenant that the
lessor thereunder is not permitted, in the absence
of an uncured default, to disturb the possession,
interest or quiet enjoyment of any subtenant of
the lessee, or in any manner, which would
materially adversely affect the security provided
by the related Mortgage; and
(J) Such Ground Lease, or an estoppel letter or other
agreement, requires the lessor to enter into a new
lease in the event of a termination of the Ground
Lease by reason of a default by the Mortgagor
under the Ground Lease, including, rejection of
the ground lease in a bankruptcy proceeding.
B-8
(xxxviii) Deed of Trust. If the related Mortgage is a deed of
trust, a trustee, duly qualified under applicable law to serve as such, is
properly designated and serving under such Mortgage.
(xxxix) Lien Releases. Except in cases where either (a) a
release of a portion of the Mortgaged Property was contemplated at origination
of the Mortgage Loan and such portion was not considered material for purposes
of underwriting the Mortgage Loan, (b) release is conditioned upon the
satisfaction of certain underwriting and legal requirements or the payment of a
release price, or (c) a defeasance is effected in accordance with the Mortgage
Loan Documents, the related Mortgage Note or Mortgage does not require the
holder thereof to release all or any portion of the Mortgaged Property from the
lien of the related Mortgage except upon payment in full of all amounts due
under such Mortgage Loan.
(xl) Junior Liens. The Mortgage Loan does not permit the
related Mortgaged Property to be encumbered by any lien junior to or of equal
priority with the lien of the related Mortgage (excluding any lien relating to
another Mortgage Loan that is cross-collateralized with such Mortgage Loan)
without the prior written consent of the holder thereof or the satisfaction of
debt service coverage or similar conditions specified therein.
(xli) Mortgagor Bankruptcy. To the Seller's knowledge, the
Mortgagor is not a debtor in any state or federal bankruptcy or insolvency
proceeding.
(xlii) Due Organization of Mortgagors. As of the date of
origination of each Mortgage, each related Mortgagor which is not a natural
person was duly organized and validly existing under the laws of the state of
its jurisdiction.
(xliii) Due-On-Sale. The Mortgage Loan contains provisions for
the acceleration of the payment of the unpaid principal balance of such Mortgage
Loan if, without complying with the requirements of such Mortgage Loan, the
related Mortgaged Property, or any controlling interest therein, is directly or
indirectly transferred or sold.
(xliv) Single Purpose Entity. As of the date of the
origination of the relevant Mortgage Loan, the related Mortgagor is an entity,
other than an individual, whose organizational documents or the related Mortgage
Loan Documents provide substantially to the effect that the Mortgagor: (A) is
formed or organized solely for the purpose of owning and operating one or more
of the Mortgaged Properties securing the Mortgage Loans, (B) may not engage in
any business unrelated to such Mortgaged Property or Mortgaged Properties, (C)
does not have any material assets other than those related to its interest in
and operation of such Mortgage Property or Mortgaged Properties, (D) may not
incur indebtedness other than as permitted by the related Mortgage or other
Mortgage Loan Documents, (E) has its own books and records separate and apart
from any other person, and (F) holds itself out as a legal entity, separate and
apart from any other person.
(xlv) Defeasance Provisions. Any Mortgage Loan which contains
a provision for any defeasance of mortgage collateral by the Mortgagor, either
(A) requires the consent of the holder of the Mortgage Loan to any defeasance,
or (B) permits defeasance (i) no earlier than two years after the Closing Date
(as defined in the Pooling and Servicing Agreement, dated as of
▇-▇
▇▇▇▇▇▇▇▇ ▇, ▇▇▇▇), (▇▇) only with substitute collateral constituting "government
securities" within the meaning of Treas. Reg. ss. 1.860G-2(a)(8)(i), and (iii)
only to facilitate the disposition of mortgage real property and not as a part
of an arrangement to collateralize a REMIC offering with obligations that are
not real estate mortgages.
(xlvi) Defeasance Costs. If the Mortgage Loan permits
defeasance, then the mortgage loan documents related to such Mortgage Loan
require (a) the borrower to pay all rating agency fees associated with
defeasance and all other out-of-pocket expenses associated with defeasance such
as accountant's fees and opinions of counsel, or (b) that the borrower provide a
REMIC opinion, an opinion regarding the first priority perfected security
interest in the defeasance collateral, rating agency letters certifying no
rating qualification or downgrade on any securities, and accountant
certification that all payments from the defeasance collateral are sufficient to
make monthly principal and interest payments on such Mortgage Loan through
maturity.
(xlvii) Rating Agency Fees for Assumptions. In the case of
each Mortgage Loan that entitles the Mortgagor to cause an assumption of such
Mortgage Loan by a third party, the holder of each Mortgage Loan is entitled to
require the payment by the related Mortgagor of any related rating agency fees
if a Rating Agency Confirmation is required under the Pooling and Servicing
Agreement in connection with such assumption.
It is understood and agreed that the representations and
warranties set forth in this Exhibit B shall survive delivery of the respective
Mortgage Files to the Purchaser, the Depositor and/or the Trustee and shall
inure to the benefit of the Purchaser, and its successors and assigns (including
without limitation the Depositor, the Trustee and the holders of the
Certificates), notwithstanding any restrictive or qualified endorsement or
assignment.
B-10
SCHEDULE B-1 TO EXHIBIT B
EXCEPTIONS TO REPRESENTATIONS AND WARRANTIES
LOAN # 30760 PLAZA ESCONDIDA
----------------------------
EXCEPTIONS: (xl) - A mezzanine loan (Tranche #2-$300,000 loan)
encumbers the Mortgaged Property, but is subject to an Intercreditor Agreement
which generally only permits the Mezzanine Lender (GMACCM) to receive payment
from excess cash flow. The mezzanine loan is not cross collateralized with this
Mortgage Loan.
LOAN # 27320 FOX OFFICE BUILDING
--------------------------------
EXCEPTIONS: (xlv) (B)(i) Defeasance may occur upon the earlier of
(i) 3 years after Note Date
-----------
(October, 16, 2000) and (ii) 2 years after the securitization of the Mortgage
Loan.
B-1-1