Exhibit 99.2
EXECUTION VERSION
MORTGAGE LOAN PURCHASE AGREEMENT
This Mortgage Loan Purchase Agreement, dated as of June 21,
2005
(this "Agreement"), is entered into between Countrywide Commercial
Real Estate
Finance, Inc. (the "Seller") and Merrill Lynch Mortgage Investors,
Inc. (the
"Purchaser").
The Seller intends to sell and the Purchaser intends to
purchase
certain multifamily, commercial and manufactured housing community
mortgage
loans (the "Mortgage Loans") identified on the schedule (the
"Mortgage Loan
Schedule") annexed hereto as Schedule II. The Purchaser intends to
deposit the
Mortgage Loans, along with certain other mortgage loans (the "Other
Mortgage
Loans"), into a trust fund (the "Trust Fund"), the beneficial
ownership of
which will be evidenced by multiple classes of mortgage
pass-through
certificates (the "Certificates"). One or more "real estate
mortgage
investment conduit" ("REMIC") elections will be made with respect
to most of
the Trust Fund. The Trust Fund will be created and the Certificates
will be
issued pursuant to a Pooling and Servicing Agreement, dated as of
June 1, 2005
(the "Pooling and Servicing Agreement"), among the Purchaser as
depositor,
Midland Loan Services, Inc. as master servicer (in such capacity,
the "Master
Servicer") and as special servicer (in such capacity, the "Special
Servicer"),
and Wells Fargo Bank, N.A., as trustee (the "Trustee"). Capitalized
terms used
but not defined herein (including the schedules attached hereto)
have the
respective meanings set forth in the Pooling and Servicing
Agreement.
The Purchaser has entered into an Underwriting Agreement, dated
as
of June 21, 2005 (the "Underwriting Agreement"), with Merrill
Lynch, Pierce,
Fenner & Smith Incorporated ("Merrill Lynch"), for itself and
as
representative of Countrywide Securities Corporation
("Countrywide"), PNC
Capital Markets, Inc. ("PNC") and Wachovia Capital Markets, LLC
("Wachovia";
Merrill Lynch, Countrywide, PNC and Wachovia, collectively, in such
capacity,
the "Underwriters"), whereby the Purchaser will sell to the
Underwriters all
of the Certificates that are to be registered under the Securities
Act of
1933, as amended (such Certificates, the "Publicly-Offered
Certificates"). The
Purchaser has also entered into a Certificate Purchase Agreement,
dated as of
June 21, 2005 (the "Certificate Purchase Agreement"), with Merrill
Lynch, for
itself and as representative of Countrywide (together in such
capacity, the
"Initial Purchasers"), whereby the Purchaser will sell to the
Initial
Purchasers all of the remaining Certificates (such Certificates,
the "Private
Certificates").
Now, therefore, in consideration of the premises and the mutual
agreements set forth herein, the parties agree as follows:
SECTION 1. Agreement to Purchase.
The Seller agrees to sell, and the Purchaser agrees to purchase,
the
Mortgage Loans identified on the Mortgage Loan Schedule. The
Mortgage Loan
Schedule may be amended to reflect the actual Mortgage Loans
delivered to the
Purchaser pursuant to the terms hereof. The Mortgage Loans are
expected to
have an aggregate principal balance of $456,814,657 (the
"Countrywide Mortgage
Loan Balance") (subject to a variance of plus or minus 5.0%) as of
the close
of business on the Cut-off Date, after giving effect to any
payments due on or
before such date, whether or not such payments are received. The
Countrywide
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Mortgage Loan Balance, together with the aggregate principal
balance of the
Other Mortgage Loans as of the Cut-off Date (after giving effect to
any
payments due on or before such date, whether or not such payments
are
received), is expected to equal an aggregate principal balance (the
"Cut-off
Date Pool Balance") of $1,737,992,952 (subject to a variance of
plus or minus
5%). The purchase and sale of the Mortgage Loans shall take place
on June 29,
2005 or such other date as shall be mutually acceptable to the
parties to this
Agreement (the "Closing Date"). The consideration (the
"Purchase
Consideration") for the Mortgage Loans shall be equal to (i)
105.1066% of the
Countrywide Mortgage Loan Balance as of the Cut-off Date, plus
(ii)
$1,981,649, which amount represents the amount of interest accrued
on the
Countrywide Mortgage Loan Balance at the related Net Mortgage Rate
for the
period from and including the Cut-off Date up to but not including
the Closing
Date.
The Purchase Consideration shall be paid to the Seller or its
designee by wire transfer in immediately available funds on the
Closing Date.
The Purchaser hereby directs the Seller to deliver, and the
Seller
shall deliver, the Closing Date Deposit (in the amount of
$8,444.76) to the
Master Servicer on the Closing Date. The Closing Date Deposit shall
be
delivered to the account specified by the Master Servicer by wire
transfer of
immediately available funds.
SECTION 2. Conveyance of Mortgage Loans.
(a) Effective as of the Closing Date, subject only to receipt of
the
Purchase Consideration and the satisfaction or waiver of the
conditions to
closing set forth in Section 5 of this Agreement (which conditions
shall be
deemed to have been satisfied or waived upon the Seller's receipt
of the
Purchase Consideration), the Seller does hereby sell, transfer,
assign, set
over and otherwise convey to the Purchaser, without recourse
(except as set
forth in this Agreement), all the right, title and interest of the
Seller in
and to the Mortgage Loans identified on the Mortgage Loan Schedule
as of such
date, on a servicing released basis, together with all of the
Seller's right,
title and interest in and to the proceeds of any related title,
hazard,
primary mortgage or other insurance proceeds and all of the
Seller's right,
title and interest in and to the Closing Date Deposit. The Mortgage
Loan
Schedule, as it may be amended, shall conform to the requirements
set forth in
this Agreement and the Pooling and Servicing Agreement.
(b) The Purchaser or its assignee shall be entitled to receive
all
scheduled payments of principal and interest due after the Cut-off
Date, and
all other recoveries of principal and interest collected after the
Cut-off
Date (other than in respect of principal and interest on the
Mortgage Loans
due on or before the Cut-off Date). All scheduled payments of
principal and
interest due on or before the Cut-off Date but collected after the
Cut-off
Date, and recoveries of principal and interest collected on or
before the
Cut-off Date (only in respect of principal and interest on the
Mortgage Loans
due on or before the Cut-off Date and principal prepayments
thereon), shall
belong to, and be promptly remitted to, the Seller.
(c) The Seller hereby represents and warrants that it has or
will
have, on behalf of the Purchaser, delivered to the Trustee (i) on
or before
the Closing Date, the documents and instruments specified below
with respect
to each Mortgage Loan that are Specially Designated Mortgage Loan
Documents
and (ii) on or before the date that is 30 days after the
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Closing Date, the remaining documents and instruments specified
below that are
not Specially Designated Mortgage Loan Documents with respect to
each Mortgage
Loan (the documents and instruments specified below and referred to
in clauses
(i) and (ii) preceding, collectively, a "Mortgage File"). All
Mortgage Files
so delivered will be held by the Trustee in escrow for the benefit
of the
Seller at all times prior to the Closing Date. Each Mortgage File
shall
contain the following documents:
(i) the original executed Mortgage Note for the subject
Mortgage
Loan, including any power of attorney related to the execution
thereof
(or
a lost note affidavit and indemnity with a copy of such Mortgage
Note
attached thereto), together with any and all intervening
endorsements
thereon, endorsed on its face or by allonge attached thereto
(without
recourse, representation or warranty, express or implied) to the
order of
Wells Fargo Bank, N.A., as trustee for the registered holders of
Merrill
Lynch Mortgage Trust 2005-MCP1, Commercial Mortgage
Pass-Through
Certificates, Series 2005-MCP1, or in blank;
(ii) an original or copy of the Mortgage, together with originals
or
copies of any and all intervening assignments thereof, in each
case
(unless not yet returned by the applicable recording office)
with
evidence of recording indicated thereon or certified by the
applicable
recording office;
(iii) an original or copy of any related Assignment of Leases
(if
such
item is a document separate from the Mortgage), together with
originals or copies of any and all intervening assignments thereof,
in
each
case (unless not yet returned by the applicable recording
office)
with
evidence of recording indicated thereon or certified by the
applicable recording office;
(iv) an original executed assignment, in recordable form (except
for
completion of the assignee's name (if the assignment is delivered
in
blank) and any missing recording information or a certified copy of
that
assignment as sent for recording), of (a) the Mortgage, (b) any
related
Assignment of Leases (if such item is a document separate from
the
Mortgage) and (c) any other recorded document relating to the
subject
Mortgage Loan otherwise included in the Mortgage File, in favor of
Wells
Fargo Bank, N.A., as trustee for the registered holders of Merrill
Lynch
Mortgage Trust 2005-MCP1, Commercial Mortgage Pass-Through
Certificates,
Series 2005-MCP1, or in blank;
(v) an original assignment of all unrecorded documents relating
to
the
Mortgage Loan (to the extent not already assigned pursuant to
clause
(iv)
above) in favor of Wells Fargo Bank, N.A., as trustee for the
registered holders of Merrill Lynch Mortgage Trust 2005-MCP1,
Commercial
Mortgage Pass-Through Certificates, Series 2005-MCP1, or in
blank;
(vi) originals or copies of any consolidation, assumption,
substitution and modification agreements in those instances where
the
terms or provisions of the Mortgage or Mortgage Note have been
consolidated or modified or the subject Mortgage Loan has been
assumed;
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(vii) the original or a copy of the policy or certificate of
lender's title insurance or, if such policy has not been issued
or
located, an original or copy of an irrevocable, binding commitment
(which
may
be a pro forma policy or a marked version of the policy that has
been
executed by an authorized representative of the title company or
an
agreement to provide the same pursuant to binding escrow
instructions
executed by an authorized representative of the title company) to
issue
such
title insurance policy;
(viii) any filed copies or other evidence of filing of any prior
UCC
Financing Statements in favor of the originator of the subject
Mortgage
Loan
or in favor of any assignee prior to the Trustee (but only to
the
extent the Seller had possession of such UCC Financing Statements
prior
to
the Closing Date) and, if there is an effective UCC Financing
Statement in favor of the Seller on record with the applicable
public
office for UCC Financing Statements, a UCC Financing Statement
assignment, in form suitable for filing in favor of Wells Fargo
Bank,
N.A., as trustee for the registered holders of Merrill Lynch
Mortgage
Trust 2005-MCP1, Commercial Mortgage Pass-Through Certificates,
Series
2005-MCP1, as assignee, or in blank;
(ix) an original or copy of any Ground Lease, guaranty or
ground
lessor estoppel;
(x) any intercreditor agreement relating to permitted debt of
the
Mortgagor and any intercreditor agreement relating to mezzanine
debt
related to the Mortgagor;
(xi) an original or a copy of any loan agreement, any escrow or
reserve agreement, any security agreement, any management
agreement, any
agreed upon procedures letter, any lockbox or cash management
agreements,
any
environmental reports or any letter of credit, in each case
relating
to
the subject Mortgage Loan; and
(xii) with respect to a Mortgage Loan secured by a hospitality
property, a signed copy of any franchise agreement and/or
franchisor
comfort letter.
The foregoing
Mortgage File delivery requirement shall be subject to
Section 2.01(c) of the Pooling and Servicing Agreement.
(d) The Seller shall
retain an Independent third party (the
"Recording/Filing Agent") that shall, as to each Mortgage Loan,
promptly (and
in any event within 90 days following the later of the Closing Date
and the
delivery of each Mortgage, Assignment of Leases, recordable
document and UCC
Financing Statement to the Trustee) cause to be submitted for
recording or
filing, as the case may be, in the appropriate public office for
real property
records or UCC Financing Statements, each assignment of Mortgage,
assignment
of Assignment of Leases and any other recordable documents relating
to each
such Mortgage Loan in favor of the Trustee that is referred to in
clause (iv)
of the definition of "Mortgage File" and each UCC Financing
Statement
assignment in favor of the Trustee and that is referred to in
clause (viii) of
the definition of "Mortgage File." Each such assignment and UCC
Financing
Statement assignment shall reflect that the recorded original
should be
returned by the public recording office to the Trustee following
recording,
and each such assignment and UCC Financing Statement assignment
shall reflect
that the file copy thereof should be returned to the Trustee
following filing;
provided, that in those instances where the public recording
office
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retains the original assignment of Mortgage or assignment of
Assignment of
Leases, the Recording/Filing Agent shall obtain therefrom a
certified copy of
the recorded original. If any such document or instrument is lost
or returned
unrecorded or unfiled, as the case may be, because of a defect
therein, then
the Seller shall prepare a substitute therefor or cure such defect
or cause
such to be done, as the case may be, and the Seller shall deliver
such
substitute or corrected document or instrument to the Trustee (or,
if the
Mortgage Loan is then no longer subject to the Pooling and
Servicing
Agreement, to the then holder of such Mortgage Loan).
The Seller shall bear the out-of-pocket costs and expenses of
all
such recording, filing and delivery contemplated in the preceding
paragraph,
including, without limitation, any costs and expenses that may be
incurred by
the Trustee in connection with any such recording, filing or
delivery
performed by the Trustee at the Seller's request and the fees of
the
Recording/Filing Agent.
(e) All such other relevant documents and records that (a) relate
to
the administration or servicing of the Mortgage Loans, (b) are
reasonably
necessary for the ongoing administration and/or servicing of such
Mortgage
Loans by the Master Servicer in connection with its duties under
the Pooling
and Servicing Agreement, and (c) are in the possession or under the
control of
the Seller, together with all unapplied escrow amounts and reserve
amounts in
the possession or under the control of the Seller that relate to
the Mortgage
Loans, shall be delivered or caused to be delivered by the Seller
to the
Master Servicer (or, at the direction of the Master Servicer, to
the
appropriate sub-servicer); provided that the Seller shall not be
required to
deliver any draft documents, privileged or other communications,
credit
underwriting or due diligence analyses, credit committee briefs or
memoranda
or other internal approval documents or data or internal
worksheets,
memoranda, communications or evaluations.
The Seller
agrees to use reasonable efforts to deliver to the Trustee,
for its administrative convenience in reviewing the Mortgage Files,
a mortgage
loan checklist for each Mortgage Loan. The foregoing sentence
notwithstanding,
the failure of the Seller to deliver a mortgage loan checklist or a
complete
mortgage loan checklist shall not give rise to any liability
whatsoever on the
part of the Seller to the Purchaser, the Trustee or any other
person because
the delivery of the mortgage loan checklist is being provided to
the Trustee
solely for its administrative convenience.
(f) The Seller shall take such actions as are reasonably
necessary
to assign or otherwise grant to the Trust Fund the benefit of any
letters of
credit in the name of the Seller, which secure any Mortgage
Loan.
(g) On or before the Closing Date, the Seller shall provide to
the
Master Servicer, the initial data (as of the Cut-off Date or the
most recent
earlier date for which such data is available) contemplated by the
CMSA Loan
Setup File, the CMSA Loan Periodic Update File, the CMSA Operating
Statement
Analysis Report and the CMSA Property File.
SECTION 3. Representations, Warranties and Covenants of Seller.
(a) The Seller hereby represents and warrants to and covenants
with
the Purchaser, as of the date hereof, that:
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(i) The Seller is a corporation duly organized, validly existing
and
in
good standing under the laws of the State of California and the
Seller
has
taken all necessary corporate action to authorize the
execution,
delivery and performance of this Agreement by it, and has the power
and
authority to execute, deliver and perform this Agreement and
all
transactions contemplated hereby.
(ii) This Agreement has been duly and validly authorized,
executed
and
delivered by the Seller, all requisite action by the Seller's
directors and officers has been taken in connection therewith,
and
(assuming the due authorization, execution and delivery hereof by
the
Purchaser) this Agreement constitutes the valid, legal and
binding
agreement of the Seller, enforceable against the Seller in
accordance
with
its terms, except as such enforcement may be limited by (A)
laws
relating to bankruptcy, insolvency, fraudulent transfer,
reorganization,
receivership or moratorium, (B) other laws relating to or affecting
the
rights of creditors generally, or (C) general equity principles
(regardless of whether such enforcement is considered in a
proceeding in
equity or at law).
(iii) The execution and delivery of this Agreement by the Seller
and
the
Seller's performance and compliance with the terms of this
Agreement
will
not (A) violate the Seller's certificate of incorporation or
bylaws,
(B)
violate any law or regulation or any administrative decree or
order
to
which it is subject or (C) constitute a default (or an event
which,
with
notice or lapse of time, or both, would constitute a default)
under,
or
result in the breach of, any material contract, agreement or
other
instrument to which the Seller is a party or by which the Seller
is
bound, which default might have consequences that would, in the
Seller's
reasonable and good faith judgment, materially and adversely affect
the
condition (financial or other) or operations of the Seller or
its
properties or materially and adversely affect its performance
hereunder.
(iv) The Seller is not in default with respect to any order or
decree of any court or any order, regulation or demand of any
federal,
state, municipal or other governmental agency or body, which
default
might have consequences that would, in the Seller's reasonable and
good
faith judgment, materially and adversely affect the condition
(financial
or
other) or operations of the Seller or its properties or materially
and
adversely affect its performance hereunder.
(v) The Seller is not a party to or bound by any agreement or
instrument or subject to any certificate of incorporation, bylaws
or any
other corporate restriction or any judgment, order, writ,
injunction,
decree, law or regulation that would, in the Seller's reasonable
and good
faith judgment, materially and adversely affect the ability of the
Seller
to
perform its obligations under this Agreement or that requires
the
consent of any third person to the execution of this Agreement or
the
performance by the Seller of its obligations under this Agreement
(except
to
the extent such consent has been obtained).
(vi) No consent, approval, authorization or order of any court
or
governmental agency or body is required for the execution, delivery
and
performance by the Seller of or compliance by the Seller with
this
Agreement or the consummation of the transactions
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contemplated by this Agreement except as have previously been
obtained,
and
no bulk sale law applies to such transactions.
(vii) None of the sale of the Mortgage Loans by the Seller, the
transfer of the Mortgage Loans to the Trustee, and the
execution,
delivery or performance of this Agreement by the Seller, results or
will
result in the creation or imposition of any lien on any of the
Seller's
assets or property that would have a material adverse effect upon
the
Seller's ability to perform its duties and obligations under
this
Agreement or materially impair the ability of the Purchaser to
realize on
the
Mortgage Loans.
(viii) There is no action, suit, proceeding or investigation
pending
or
to the knowledge of the Seller, threatened against the Seller in
any
court or by or before any other governmental agency or
instrumentality
which would, in the Seller's good faith and reasonable judgment,
prohibit
its
entering into this Agreement or materially and adversely affect
the
validity of this Agreement or the performance by the Seller of
its
obligations under this Agreement.
(ix) Under generally accepted accounting principles ("GAAP") and
for
federal income tax purposes, the Seller will report the transfer of
the
Mortgage Loans to the
Purchaser as a sale of the Mortgage Loans to the
Purchaser in exchange for consideration consisting of a cash amount
equal
to
the Purchase Consideration. The consideration received by the
Seller
upon
the sale of the Mortgage Loans to the Purchaser will constitute
at
least reasonably equivalent value and fair consideration for the
Mortgage
Loans. The Seller will be solvent at all relevant times prior to,
and
will
not be rendered insolvent by, the sale of the Mortgage Loans to
the
Purchaser. The Seller is not selling the Mortgage Loans to the
Purchaser
with
any intent to hinder, delay or defraud any of the creditors of
the
Seller.
(b) The Seller hereby makes the representations and warranties
contained in Schedule I hereto for the benefit of the Purchaser and
the
Trustee for the benefit of the Certificateholders as of the Closing
Date
(unless a different date is specified therein), with respect to
(and solely
with respect to) each Mortgage Loan, subject, however, to the
exceptions set
forth on Annex A to Schedule I of this Agreement.
(c) If the Seller discovers or receives written notice of a
Document
Defect or a Breach relating to a Mortgage Loan pursuant to Section
2.03(a) of
the Pooling and Servicing Agreement, then the Seller shall, not
later than 90
days from such discovery or receipt of such notice (or, in the case
of a
Document Defect or Breach relating to a Mortgage Loan not being a
"qualified
mortgage" within the meaning of the REMIC Provisions (a "Qualified
Mortgage"),
not later than 90 days from any party to the Pooling and Servicing
Agreement
discovering such Document Defect or Breach, provided the Seller
receives such
notice in a timely manner), if such Document Defect or Breach
materially and
adversely affects the value of the related Mortgage Loan or the
interests of
the Certificateholders therein, cure such Document Defect or
Breach, as the
case may be, in all material respects, which shall include payment
of losses
and any Additional Trust Fund Expenses associated therewith or, if
such
Document Defect or Breach (other than omissions due solely to a
document not
having been returned by the related recording office) cannot be
cured within
such 90-day period, (i) repurchase the affected Mortgage Loan
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(which, for the purposes of this clause (i), shall include an REO
Loan) at the
applicable Purchase Price (as defined in the Pooling and Servicing
Agreement)
not later than the end of such 90-day period or (ii) substitute a
Qualified
Substitute Mortgage Loan for such affected Mortgage Loan (which,
for purposes
of this clause (ii), shall include an REO Loan) not later than the
end of such
90-day period (and in no event later than the second anniversary of
the
Closing Date) and pay the Master Servicer for deposit into the
Collection
Account any Substitution Shortfall Amount in connection therewith;
provided,
however, that, unless the Document Defect or Breach would cause the
Mortgage
Loan not to be a Qualified Mortgage, if such Document Defect or
Breach is
capable of being cured but not within such 90-day period and the
Seller has
commenced and is diligently proceeding with the cure of such
Document Defect
or Breach within such 90-day period, the Seller shall have an
additional 90
days to complete such cure (or, failing such cure, to repurchase or
substitute
the related Mortgage Loan (which, for purposes of such repurchase
or
substitution, shall include an REO Loan)); and provided, further,
that with
respect to such additional 90-day period, the Seller shall have
delivered an
officer's certificate to the Trustee setting forth the reason(s)
such Document
Defect or Breach is not capable of being cured within the initial
90-day
period and what actions the Seller is pursuing in connection with
the cure
thereof and stating that the Seller anticipates that such Document
Defect or
Breach will be cured within the additional 90-day period; and
provided,
further, that no Document Defect (other than with respect to a
Specially
Designated Mortgage Loan Document) shall be considered to
materially and
adversely affect the interests of the Certificateholders or the
value of the
related Mortgage Loan unless the document with respect to which the
Document
Defect exists is required in connection with an imminent
enforcement of the
mortgagee's rights or remedies under the related Mortgage Loan,
defending any
claim asserted by any borrower or third party with respect to the
Mortgage
Loan, establishing the validity or priority of any lien on any
collateral
securing the Mortgage Loan or for any immediate servicing
obligations.
A Document Defect or Breach (which Document Defect or Breach
materially and adversely affects the value of the related Mortgage
Loan or the
interests of the Certificateholders therein) as to a Mortgage Loan
that is
cross-collateralized and cross-defaulted with one or more other
Mortgage Loans
(each, a "Crossed Loan" and such Crossed Loans, collectively, a
"Crossed Loan
Group"), which Document Defect or Breach does not constitute a
Document Defect
or Breach, as the case may be, as to any other Crossed Loan in such
Crossed
Loan Group (without regard to this paragraph) and is not cured as
provided for
above, shall be deemed to constitute a Document Defect or Breach,
as the case
may be, as to each other Crossed Loan in the subject Crossed Loan
Group for
purposes of this paragraph and the Seller shall be required to
repurchase or
substitute all such Crossed Loans unless (1) the weighted average
debt service
coverage ratio for all the remaining Crossed Loans for the four
calendar
quarters immediately preceding such repurchase or substitution is
not less
than the weighted average debt service coverage ratio for all such
Crossed
Loans, including the affected Crossed Loan, for the four calendar
quarters
immediately preceding such repurchase or substitution, and (2) the
weighted
average loan to-value ratio for the remaining Crossed Loans
determined at the
time of repurchase or substitution based upon an appraisal obtained
by the
Special Servicer at the expense of the Seller shall not be greater
than the
weighted average loan-to-value ratio for all such Crossed Loans,
including the
affected Crossed Loan determined at the time of repurchase or
substitution
based upon an appraisal obtained by the Special Servicer at the
expense of the
Seller; provided, that if such debt service coverage and
loan-to-value
criteria are satisfied, any other Crossed Loan (that is not the
Crossed Loan
directly affected by the subject Document Defect or Breach), shall
be released
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from its cross-collateralization and cross-default provision so
long as such
Crossed Loan (that is not the Crossed Loan directly affected by the
subject
Document Defect or Breach) is held in the Trust Fund; and provided,
further,
that the repurchase or replacement of less than all such Crossed
Loans and the
release of any Crossed Loan from a cross-collateralization and
cross-default
provision shall be further subject to (i) the delivery by the
Seller to the
Trustee, at the expense of the Seller, of an Opinion of Counsel to
the effect
that such release would not cause either of REMIC I or REMIC II to
fail to
qualify as a REMIC under the Code or result in the imposition of
any tax on
"prohibited transactions" or "contributions" after the Startup Day
under the
REMIC Provisions and (ii) the consent of the Controlling Class
Representative
(if one is then acting), which consent shall not be unreasonably
withheld or
delayed. In the event that one or more of such other Crossed Loans
satisfy the
aforementioned criteria, the Seller may elect either to repurchase
or
substitute for only the affected Crossed Loan as to which the
related Document
Defect or Breach exists or to repurchase or substitute for all of
the Crossed
Loans in the related Crossed Loan Group. All documentation relating
to the
termination of the cross-collateralization provisions of a Crossed
Loan being
repurchased shall be prepared at the expense of the Seller and,
where
required, with the consent of the related borrower. For a period of
two years
from the Closing Date, so long as there remains any Mortgage File
relating to
a Mortgage Loan as to which there is any uncured Document Defect or
Breach
known to the Seller, the Seller shall provide, once every ninety
days, the
officer's certificate to the Trustee described above as to the
reason(s) such
Document Defect or Breach remains uncured and as to the actions
being taken to
pursue cure; provided, however, that, without limiting the effect
of the
foregoing provisions of this Section 3(c), if such Document Defect
or Breach
shall materially and adversely affect the value of such Mortgage
Loan or the
interests of the holders of the Certificates therein (subject to
the last
proviso in the sole sentence of the preceding paragraph), the
Seller shall in
all cases on or prior to the second anniversary of the Closing Date
either
cause such Document Defect or Breach to be cured or repurchase or
substitute
for the affected Mortgage Loan. The delivery of a commitment to
issue a policy
of lender's title insurance as described in representation 8 set
forth on
Schedule I hereto in lieu of the delivery of the actual policy of
lender's
title insurance shall not be considered a Document Defect or Breach
with
respect to any Mortgage File if such actual policy of insurance is
delivered
to the Trustee or a Custodian on its behalf not later than the 90th
day
following the Closing Date.
To the extent that the Seller is required to repurchase or
substitute for a Crossed Loan hereunder in the manner prescribed
above in this
Section 3(c) while the Trustee continues to hold any other Crossed
Loans in
such Crossed Loan Group, the Seller and the Purchaser shall not
enforce any
remedies against the other's Primary Collateral (as defined below),
but each
is permitted to exercise remedies against the Primary Collateral
securing its
respective Crossed Loan(s), so long as such exercise does not
materially
impair the ability of the other party to exercise its remedies
against the
Primary Collateral securing the Crossed Loan(s) held thereby.
If the exercise by one party would materially impair the ability
of
the other party to exercise its remedies with respect to the
Primary
Collateral securing the Crossed Loan(s) held by such party, then
the Seller
and the Purchaser shall forbear from exercising such remedies until
the
Mortgage Loan documents evidencing and securing the relevant
Crossed Loans can
be modified in a manner consistent with this Agreement to remove
the threat of
material impairment as a result of the exercise of remedies. Any
reserve or
other cash collateral or letters of credit securing the Crossed
Loans shall be
allocated between such Crossed Loans in accordance with
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<PAGE>
the Mortgage Loan documents, or, if the related Mortgage Loan
documents do not
so provide, then on a pro rata basis based upon their outstanding
Stated
Principal Balances. Notwithstanding the foregoing, if a Crossed
Loan is
modified to terminate the related cross-collateralization and/or
cross-default
provisions, the Seller shall furnish to the Trustee an Opinion of
Counsel that
such modification shall not cause an Adverse REMIC Event.
For purposes hereof, "Primary Collateral" shall mean the
Mortgaged
Property directly securing a Crossed Loan and excluding any
property as to
which the related lien may only be foreclosed upon by exercise
of
cross-collateralization provisions of such Mortgage Loans.
Notwithstanding any of the foregoing provisions of this Section
3(c), if there is a Document Defect or Breach (which Document
Defect or Breach
materially and adversely affects the value of the related Mortgage
Loan or the
interests of the Certificateholders therein) with respect to one or
more
Mortgaged Properties with respect to a Mortgage Loan, the Seller
shall not be
obligated to repurchase or substitute the Mortgage Loan if (i) the
affected
Mortgaged Property(ies) may be released pursuant to the terms of
any partial
release provisions in the related Mortgage Loan documents (and such
Mortgaged
Property(ies) are, in fact, released), (ii) the remaining
Mortgaged
Property(ies) satisfy the requirements, if any, set forth in the
Mortgage Loan
documents and the Seller provides an opinion of counsel to the
effect that
such release would not cause either of REMIC I or REMIC II to fail
to qualify
as a REMIC under the Code or result in the imposition of any tax
on
"prohibited transactions" or "contributions" after the Startup Day
under the
REMIC Provisions and (iii) each Rating Agency then rating the
Certificates
shall have provided written confirmation that such release would
not cause the
then-current ratings of the Certificates rated by it to be
qualified,
downgraded or withdrawn.
The foregoing provisions of this Section 3(c) notwithstanding,
the
Purchaser's sole remedy (subject to the last sentence of this
paragraph) for a
breach of representation 30 set forth on Schedule I hereto shall be
the cure
of such breach by the Seller, which cure shall be effected through
the payment
by the Seller of such costs and expenses (without regard to whether
such costs
and expenses are material or not) specified in such representation
that have
not, at the time of such cure, been received by the Master Servicer
or the
Special Servicer from the related Mortgagor and not a repurchase
or
substitution of the related Mortgage Loan. Following the Seller's
remittance
of funds in payment of such costs and expenses, the Seller shall be
deemed to
have cured the breach of representation 30 in all respects. To the
extent any
fees or expenses that are the subject of a cure by the Seller are
subsequently
obtained from the related Mortgagor, the cure payment made by the
Seller shall
be returned to the Seller. Notwithstanding the prior provisions of
this
paragraph, the Seller, acting in its sole discretion, may effect a
repurchase
or substitution (in accordance with the provisions of this Section
3(c)
setting forth the manner in which a Mortgage Loan may be
repurchased or
substituted) of a Mortgage Loan, as to which representation 30 set
forth on
Schedule I has been breached, in lieu of paying the costs and
expenses that
were the subject of the breach of representation 30 set forth on
Schedule I.
(d) In connection with any permitted repurchase or substitution
of
one or more Mortgage Loans contemplated hereby, upon receipt of a
certificate
from a Servicing Officer certifying as to the receipt of the
applicable
Purchase Price (as defined in the Pooling and Servicing Agreement)
or
Substitution Shortfall Amount(s), as applicable, in the
Collection
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Account, and, if applicable, the delivery of the Mortgage File(s)
and the
Servicing File(s) for the related Qualified Substitute Mortgage
Loan(s) to the
Custodian and the Master Servicer, respectively, (i) the Trustee
shall be
required to execute and deliver such endorsements and assignments
as are
provided to it by the Master Servicer or the Seller, in each case
without
recourse, representation or warranty, as shall be necessary to vest
in the
Seller the legal and beneficial ownership of each repurchased
Mortgage Loan or
substituted Mortgage Loan, as applicable, (ii) the Trustee, the
Custodian, the
Master Servicer and the Special Servicer shall each tender to the
Seller, upon
delivery to each of them of a receipt executed by the Seller, all
portions of
the Mortgage File and other documents pertaining to such Mortgage
Loan
possessed by it, and (iii) the Master Servicer and the Special
Servicer shall
release to the Seller any Escrow Payments and Reserve Funds held by
it in
respect of such repurchased or deleted Mortgage Loan(s).
At the time a substitution is made, the Seller shall deliver
the
related Mortgage File to the Trustee and certify that the
substitute Mortgage
Loan is a Qualified Substitute Mortgage Loan.
No substitution of a Qualified Substitute Mortgage Loan or
Qualified
Substitute Mortgage Loans may be made in any calendar month after
the
Determination Date for such month. Periodic Payments due with
respect to any
Qualified Substitute Mortgage Loan after the related date of
substitution
shall be part of REMIC I, as applicable. No substitution of a
Qualified
Substitute Mortgage Loan for a deleted Mortgage Loan shall be
permitted under
this Agreement if, after such substitution, the aggregate of the
Stated
Principal Balances of all Qualified Substitute Mortgage Loans which
have been
substituted for deleted Mortgage Loans exceeds 10% of the aggregate
Cut-off
Date Balance of all the Mortgage Loans and the Other Mortgage
Loans. Periodic
Payments due with respect to any Qualified Substitute Mortgage Loan
on or
prior to the related date of substitution shall not be part of the
Trust Fund
or REMIC I.
(e) This Section 3 provides the sole remedies available to the
Purchaser, the Certificateholders, or the Trustee on behalf of
the
Certificateholders, respecting any Document Defect in a Mortgage
File or any
Breach of any representation or warranty set forth in or required
to be made
pursuant to Section 3 of this Agreement.
SECTION 4. Representations, Warranties and Covenants of the
Purchaser. In order to induce the Seller to enter into this
Agreement, the
Purchaser hereby represents, warrants and covenants for the benefit
of the
Seller as of the date hereof that:
(a) The Purchaser is a corporation duly organized, validly
existing
and in good standing under the laws of the State of Delaware and
the Purchaser
has taken all necessary corporate action to authorize the
execution, delivery
and performance of this Agreement by it, and has the power and
authority to
execute, deliver and perform this Agreement and all transactions
contemplated
hereby.
(b) This Agreement has been duly and validly authorized,
executed
and delivered by the Purchaser, all requisite action by the
Purchaser's
directors and officers has been taken in connection therewith, and
(assuming
the due authorization, execution and delivery
11
<PAGE>
hereof by the Seller) this Agreement constitutes the valid, legal
and binding
agreement of the Purchaser, enforceable against the Purchaser in
accordance
with its terms, except as such enforcement may be limited by (A)
laws relating
to bankruptcy, insolvency, fraudulent transfer, reorganization,
receivership
or moratorium, (B) other laws relating to or affecting the rights
of creditors
generally, or (C) general equity principles (regardless of whether
such
enforcement is considered in a proceeding in equity or at law).
(c) The execution and delivery of this Agreement by the
Purchaser
and the Purchaser's performance and compliance with the terms of
this
Agreement will not (A) violate the Purchaser's articles of
incorporation or
bylaws, (B) violate any law or regulation or any administrative
decree or
order to which it is subject or (C) constitute a default (or an
event which,
with notice or lapse of time, or both, would constitute a default)
under, or
result in the breach of, any material contract, agreement or other
instrument
to which the Purchaser is a party or by which the Purchaser is
bound, which
default might have consequences that would, in the Purchaser's
reasonable and
good faith judgment, materially and adversely affect the condition
(financial
or other) or operations of the Purchaser or its properties or
have
consequences that would materially and adversely affect its
performance
hereunder.
(d) The Purchaser is not a party to or bound by any agreement
or
instrument or subject to any articles of association, bylaws or any
other
corporate restriction or any judgment, order, writ, injunction,
decree, law or
regulation that would, in the Purchaser's reasonable and good faith
judgment,
materially and adversely affect the ability of the Purchaser to
perform its
obligations under this Agreement or that requires the consent of
any third
person to the execution of this Agreement or the performance by the
Purchaser
of its obligations under this Agreement (except to the extent such
consent has
been obtained).
(e) Except as may be required under federal or state securities
laws
(and which will be obtained on a timely basis), 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 by the Purchaser of, or
compliance by
the Purchaser with, this Agreement, or the consummation by the
Purchaser of
any transaction described in this Agreement.
(f) Under GAAP and for federal income tax purposes, the
Purchaser
will report the transfer of the Mortgage Loans by the Seller to the
Purchaser
as a sale of the Mortgage Loans to the Purchaser in exchange for
consideration
consisting of a cash amount equal to the aggregate Purchase
Consideration.
(g) There is no action, suit, proceeding or investigation pending
or
to the knowledge of the Purchaser, threatened against the Purchaser
in any
court or by or before any other governmental agency or
instrumentality which
would materially and adversely affect the validity of this
Agreement or any
action taken in connection with the obligations of the Purchaser
contemplated
herein, or which would be likely to impair materially the ability
of the
Purchaser to enter into and/or perform under the terms of this
Agreement.
(h) The Purchaser is not in default with respect to any order
or
decree of any court or any order, regulation or demand of any
federal, state,
municipal or other governmental
12
<PAGE>
agency or body, which default might have consequences that would,
in the
Purchaser's reasonable and good faith judgment, materially and
adversely
affect the condition (financial or other) or operations of the
Purchaser or
its properties or might have consequences that would materially and
adversely
affect its performance hereunder.
SECTION 5. Closing. The closing of the sale of the Mortgage
Loans
(the "Closing") shall be held at the offices of Sidley Austin Brown
& Wood LLP
on the Closing Date. The Closing shall be subject to each of the
following
conditions:
(a) All of the representations and warranties of the Seller set
forth in or made pursuant to Sections 3(a) and 3(b) of this
Agreement and all
of the representations and warranties of the Purchaser set forth in
Section 4
of this Agreement shall be true and correct in all material
respects as of the
Closing Date;
(b) All documents specified in Section 6 of this Agreement (the
"Closing Documents"), in such forms as are agreed upon and
acceptable to the
Purchaser, the Seller, the Underwriters and their respective
counsel in their
reasonable discretion, shall be duly executed and delivered by all
signatories
as required pursuant to the respective terms thereof;
(c) The Seller shall have delivered and released to the Trustee
(or
a Custodian on its behalf) and the Master Servicer, respectively,
all
documents represented to have been or required to be delivered to
the Trustee
and the Master Servicer pursuant to Section 2 of this
Agreement;
(d) All other terms and conditions of this Agreement required to
be
complied with on or before the Closing Date shall have been
complied with in
all material respects and the Seller and the Purchaser shall have
the ability
to comply with all terms and conditions and perform all duties and
obligations
required to be complied with or performed after the Closing
Date;
(e) The Seller shall have paid all fees and expenses payable by it
to
the Purchaser or otherwise pursuant to this Agreement as of the
Closing Date;
(f) One or more letters from the independent accounting firms
of
Ernst & Young LLP and PricewaterhouseCoopers LLP, in form
satisfactory to the
Purchaser and relating to certain information regarding the
Mortgage Loans and
Certificates as set forth in the Prospectus and Prospectus
Supplement,
respectively; and
(g) The Seller shall have executed and delivered concurrently
herewith that certain Indemnification Agreement, dated as of June
21, 2005,
among the Seller, Merrill Lynch Mortgage Lending, Inc., PNC Bank,
National
Association, the Purchaser, the Underwriters and the Initial
Purchasers. Both
parties agree to use their best reasonable efforts to perform their
respective
obligations hereunder in a manner that will enable the Purchaser to
purchase
the Mortgage Loans on the Closing Date.
SECTION 6. Closing Documents. The Closing Documents shall consist
of
the following:
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<PAGE>
(a) (i) This Agreement duly executed by the Purchaser and the
Seller, (ii) the Pooling and Servicing Agreement duly executed by
the parties
thereto and (iii) the Servicing Rights Purchase Agreement, dated as
of June
29, 2005, between the Seller and Midland Loan Services, Inc., duly
executed by
such parties;
(b) An officer's certificate of the Seller, executed by a duly
authorized officer of the Seller and dated the Closing Date, and
upon which
the Purchaser, the Underwriters and the Initial Purchasers may
rely, to the
effect that: (i) the representations and warranties of the Seller
in this
Agreement are true and correct in all material respects at and as
of the
Closing Date with the same effect as if made on such date; and (ii)
the Seller
has, in all material respects, complied with all the agreements and
satisfied
all the conditions on its part that are required under this
Agreement to be
performed or satisfied at or prior to the Closing Date;
(c) An officer's certificate from an officer of the Seller
(signed
in his/her capacity as an officer), dated the Closing Date, and
upon which the
Purchaser may rely, to the effect that each individual who, as an
officer or
representative of the Seller, signed this Agreement, the
Indemnification
Agreement or any other document or certificate delivered on or
before the
Closing Date in connection with the transactions contemplated
herein or
therein, was at the respective times of such signing and delivery,
and is as
of the Closing Date, duly elected or appointed, qualified and
acting as such
officer or representative, and the signatures of such persons
appearing on
such documents and certificates are their genuine signatures;
(d) An officer's certificate from an officer of the Seller
(signed
in his/her capacity as an officer), dated the Closing Date, and
upon which the
Purchaser, the Underwriters and Initial Purchasers may rely, to the
effect
that (i) such officer has carefully examined the Specified Portions
(as
defined below) of the Prospectus Supplement and nothing has come to
his
attention that would lead him to believe that the Specified
Portions of the
Prospectus Supplement, as of the date of the Prospectus Supplement
or as of
the Closing Date, included or include any untrue statement of a
material fact
relating to the Mortgage Loans or omitted or omit to state therein
a material
fact necessary in order to make the statements therein relating to
the
Mortgage Loans, in light of the circumstances under which they were
made, not
misleading, and (ii) such officer has carefully examined the
Specified
Portions of the Private Placement Memorandum, dated as of June 21,
2005 (the
"Memorandum") (pursuant to which certain classes of the Private
Certificates
are being privately offered) and nothing has come to his attention
that would
lead him to believe that the Specified Portions of the Memorandum,
as of the
date thereof or as of the Closing Date, included or include any
untrue
statement of a material fact relating to the Mortgage Loans or
omitted or omit
to state therein a material fact necessary in order to make the
statements
therein related to the Mortgage Loans, in the light of the
circumstances under
which they were made, not misleading. The "Specified Portions" of
the
Prospectus Supplement shall consist of Annex A-1 thereto, entitled
"Certain
Characteristics of the Mortgage Loans" (insofar as the information
contained
in Annex A-1 relates to the Mortgage Loans sold by the Seller
hereunder),
Annex A-2 to the Prospectus Supplement, entitled "Certain
Statistical
Information Regarding the Mortgage Loans" (insofar as the
information
contained in Annex A-2 relates to the Mortgage Loans sold by the
Seller
hereunder), Annex B to the Prospectus Supplement entitled
"Certain
Characteristics Regarding Multifamily Properties" (insofar as the
information
contained in Annex B relates to the Mortgage Loans sold by the
Seller
hereunder), Annex C to the Prospectus Supplement, entitled
"Structural and
Collateral
14
<PAGE>
Term Sheet" (insofar as the information contained in Annex C
relates to the
Mortgage Loans sold by the Seller hereunder), the diskette which
accompanies
the Prospectus Supplement (insofar as such diskette is consistent
with Annex
A-1, Annex A-2 and/or Annex B), and the following sections of the
Prospectus
Supplement (only to the extent that any such information relates to
the Seller
or the Mortgage Loans sold by the Seller hereunder and exclusive of
any
statements in such sections that purport to describe the servicing
and
administration provisions of the Pooling and Servicing Agreement
and exclusive
of aggregated numerical information that includes the Other
Mortgage Loans):
"Summary of Prospectus Supplement--Relevant Parties--Mortgage Loan
Sellers,"
"Summary of Prospectus Supplement--The Mortgage Loans And The
Mortgaged Real
Properties," "Risk Factors" and "Description of the Mortgage Pool".
The
"Specified Portions" of the Memorandum shall consist of the
Specified Portions
of the Prospectus Supplement (as attached as an exhibit to the
Memorandum);
(e) Each of: (i) the resolutions of the Seller's board of
directors
or a committee thereof authorizing the Seller's entering into the
transactions
contemplated by this Agreement, (ii) the certificate of
incorporation and
bylaws of the Seller, and (iii) a certificate of good standing of
the Seller
issued by the State of California not earlier than thirty (30) days
prior to
the Closing Date;
(f) A written opinion of counsel for the Seller relating to
corporate and enforceability matters (which opinion may be from
in-house
counsel, outside counsel or a combination thereof), reasonably
satisfactory to
the Purchaser, its counsel and the Rating Agencies, dated the
Closing Date and
addressed to the Purchaser, the Trustee, the Underwriters, the
Initial
Purchasers and each of the Rating Agencies, together with such
other written
opinions, including as to insolvency matters, as may be required by
the Rating
Agencies; and
(g) Such further certificates, opinions and documents as the
Purchaser may reasonably request prior to the Closing Date.
SECTION 7. Costs. Whether or not this Agreement is terminated,
both
the Seller and the Purchaser shall pay their respective share of
the
transaction expenses incurred in connection with the transactions
contemplated
herein as set forth in the closing statement prepared by the
Purchaser and
delivered to and approved by the Seller on or before the Closing
Date, and in
the memorandum of understanding to which the Seller and the
Purchaser (or
affiliates thereof) are parties with respect to the transactions
contemplated
by this Agreement.
SECTION 8. Grant of a Security Interest. It is the express intent
of
the parties hereto that the conveyance of the Mortgage Loans by the
Seller to
the Purchaser as provided in Section 2 of this Agreement be, and be
construed
as, a sale of the Mortgage Loans by the Seller to the Purchaser and
not as a
pledge of the Mortgage Loans by the Seller to the Purchaser to
secure a debt
or other obligation of the Seller. However, if, notwithstanding
the
aforementioned intent of the parties, the Mortgage Loans are held
to be
property of the Seller, then, (a) it is the express intent of the
parties that
such conveyance be deemed a pledge of the Mortgage Loans by the
Seller to the
Purchaser to secure a debt or other obligation of the Seller, and
(b) (i) this
Agreement shall also be deemed to be a security agreement within
the meaning
of Article 9 of the UCC of the applicable jurisdiction; (ii) the
conveyance
provided for in Section 2 of this Agreement shall be deemed to be a
grant by
the Seller to the Purchaser of a security interest in
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<PAGE>
all of the Seller's right, title and interest in and to the
Mortgage Loans,
and all amounts payable to the holder of the Mortgage Loans in
accordance with
the terms thereof, and all proceeds of the conversion, voluntary
or
involuntary, of the foregoing into cash, instruments, securities or
other
property, including without limitation, all amounts, other than
investment
earnings (other than investment earnings required by Section
3.19(a) of the
Pooling and Servicing Agreement to offset Prepayment Interest
Shortfalls),
from time to time held or invested in the Collection Account, the
Distribution
Account or, if established, the REO Account whether in the form of
cash,
instruments, securities or other property; (iii) the assignment to
the Trustee
of the interest of the Purchaser as contemplated by Section 1 of
this
Agreement shall be deemed to be an assignment of any security
interest created
hereunder; (iv) the possession by the Trustee or any of its agents,
including,
without limitation, the Custodian, of the Mortgage Notes, and such
other items
of property as constitute instruments, money, negotiable documents
or chattel
paper shall be deemed to be possession by the secured party for
purposes of
perfecting the security interest pursuant to Section 9-313 of the
UCC of the
applicable jurisdiction; and (v) notifications to persons (other
than the
Trustee) holding such property, and acknowledgments, receipts or
confirmations
from persons (other than the Trustee) holding such property, shall
be deemed
notifications to, or acknowledgments, receipts or confirmations
from,
financial intermediaries, bailees or agents (as applicable) of the
secured
party for the purpose of perfecting such security interest under
applicable
law. The Seller and the Purchaser shall, to the extent consistent
with this
Agreement, take such actions as may be necessary to ensure that, if
this
Agreement were deemed to create a security interest in the Mortgage
Loans,
such security interest would be deemed to be a perfected security
interest of
first priority under applicable law and will be maintained as such
throughout
the term of this Agreement and the Pooling and Servicing Agreement.
The Seller
does hereby consent to the filing by the Purchaser of financing
statements
relating to the transactions contemplated hereby without the
signature of the
Seller.
SECTION 9. Notices. All notices, copies, requests, consents,
demands
and other communications required hereunder shall be in writing and
sent by
facsimile or delivered to the intended recipient at the "Address
for Notices"
specified beneath its name on the signature pages hereof or, as to
either
party, at such other address as shall be designated by such party
in a notice
hereunder to the other party. Except as otherwise provided in this
Agreement,
all such communications shall be deemed to have been duly given
when
transmitted by facsimile or personally delivered or, in the case of
a mailed
notice, upon receipt, in each case given or addressed as
aforesaid.
SECTION 10. 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 (and by the Purchaser to the
Trustee).
SECTION 11. 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
16
<PAGE>
extent of such prohibition or unenforceability without invalidating
the
remaining provisions hereof, and any such prohibition or
unenforceability in
any particular jurisdiction shall not invalidate or render
unenforceable such
provision in any other jurisdiction. To the extent permitted by
applicable
law, the parties hereto waive any provision of law that prohibits
or renders
void or unenforceable any provision hereof.
SECTION 12. Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be an original, but
which together
shall constitute one and the same agreement.
SECTION 13. 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 NEW YORK. THE
PARTIES
HERETO INTEND THAT THE PROVISIONS OF SECTION 5-1401 OF THE NEW YORK
GENERAL
OBLIGATIONS LAW SHALL APPLY TO THIS AGREEMENT.
SECTION 14. Attorneys' Fees. If any legal action, suit or
proceeding
is commenced between the Seller and the Purchaser regarding their
respective
rights and obligations under this Agreement, the prevailing party
shall be
entitled to recover, in addition to damages or other relief, costs
and
expenses, attorneys' fees and court costs (including, without
limitation,
expert witness fees). As used herein, the term "prevailing party"
shall mean
the party that obtains the principal relief it has sought, whether
by
compromise settlement or judgment. If the party that commenced or
instituted
the action, suit or proceeding shall dismiss or discontinue it
without the
concurrence of the other party, such other party shall be deemed
the
prevailing party.
SECTION 15. Further Assurances. The Seller and the Purchaser
agree
to execute and deliver such instruments and take such further
actions as the
other party may, from time to time, reasonably request in order to
effectuate
the purposes and to carry out the terms of this Agreement.
SECTION 16. Successors and Assigns. The rights and obligations
of
the Seller under this Agreement shall not be assigned by the Seller
without
the prior written consent of the Purchaser, except that any person
into which
the Seller may be merged or consolidated, or any corporation
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 has
the right to
assign its interest under this Agreement, in whole or in part, as
may be
required to effect the purposes of the Pooling and Servicing
Agreement, and
the assignee shall, to the extent of such assignment, succeed to
the rights
and obligations hereunder of the Purchaser. Subject to the
foregoing, this
Agreement shall bind and inure to the benefit of and be enforceable
by the
Seller, the Purchaser, the Underwriters (as intended third party
beneficiaries
hereof), the Initial Purchasers (also as intended third party
beneficiaries
hereof) and their permitted successors and assigns. This Agreement
is
enforceable by the Underwriters, the Initial Purchasers and the
other third
party beneficiaries hereto in all respects to the same extent as if
they had
been signatories hereof.
17
<PAGE>
SECTION 17. Amendments. No term or provision of this Agreement
may
be waived or modified unless such waiver or modification is in
writing and
signed by a duly authorized officer of the party hereto against
whom such
waiver or modification is sought to be enforced. The Seller's
obligations
hereunder shall in no way be expanded, changed or otherwise
affected by any
amendment of or modification to the Pooling and Servicing
Agreement,
including, without limitation, any defined terms therein, unless
the Seller
has consented to such amendment or modification in writing.
SECTION 18. Accountants' Letters. The parties hereto shall
cooperate
with Ernst & Young LLP and PriceWaterhouseCoopers LLP in making
available all
information and taking all steps reasonably necessary to permit
such
accountants to deliver the letters required by the Underwriting
Agreement and
the Certificate Purchase Agreement.
SECTION 19. Knowledge. Whenever a representation or warranty or
other statement in this Agreement (including, without limitation,
Schedule I
hereto) is made with respect to a Person's "knowledge," such
statement refers
to such Person's employees or agents who were or are responsible
for or
involved with the indicated matter and have actual knowledge of the
matter in
question.
SECTION 20. Cross-Collateralized Mortgage Loans. Each Crossed
Loan
Group is identified on the Mortgage Loan Schedule. For purposes of
reference,
the Mortgaged Property that relates or corresponds to any of the
Mortgage
Loans in a Crossed Loan Group shall be the property identified in
the Mortgage
Loan Schedule as corresponding thereto. The provisions of this
Agreement,
including, without limitation, each of the representations and
warranties set
forth in Schedule I hereto and each of the capitalized terms used
herein but
defined in the Pooling and Servicing Agreement, shall be
interpreted in a
manner consistent with this Section 20. In addition, if there
exists with
respect to any Crossed Loan Group only one original of any document
referred
to in the definition of "Mortgage File" in this Agreement and
covering all the
Mortgage Loans in such Crossed Loan Group, the inclusion of the
original of
such document in the Mortgage File for any of the Mortgage Loans in
such
Crossed Loan Group shall be deemed an inclusion of such original in
the
Mortgage File for each such Mortgage Loan.
18
<PAGE>
IN WITNESS WHEREOF, the Seller and the Purchaser have caused
their
names to be signed hereto by their respective duly authorized
officers as of
the date first above written.
SELLER
COUNTRYWIDE COMMERCIAL REAL
ESTATE FINANCE, INC.
By: /s/ Marlyn A.
Marincas
----------------------------------
Name: Marlyn A.
Marincas
Title: Senior Vice President
Address for Notices:
Telecopier No.: (818) 225-6342
Telephone No.: (818)
225-4032
PURCHASER
MERRILL LYNCH MORTGAGE INVESTORS,
INC.
By: /s/ George H. Kok
-----------------------------------
Name: George H.
Kok
Title: Vice President
Address for Notices:
Merrill Lynch Mortgage Investors, Inc.
Four World Financial Center
250 Vesey Street
New York, New York 10080
Telecopier No.: (212)
449-3658
Telephone No.: (212)
449-3611
Attention: David M.
Rodgers
with a copy
to:
Robert M. Denicola, Esq.
Merrill Lynch Mortgage Investors, Inc.
Four World Financial Center
250 Vesey Street
New York, New York 10080
Telecopier No.: (212)
449-0265
Telephone No.: (212)
449-2916
Countrywide
Mortgage Loan Purchase Agreement
<PAGE>
SCHEDULE I
Mortgage Loan Representations and Warranties
For purposes of this Schedule I, the "Value" of a Mortgaged
Property
shall mean the value of such Mortgaged Property as determined by
the appraisal
(and subject to the assumptions set forth in the appraisal)
performed in
connection with the origination of the related Mortgage Loan.
1. Mortgage Loan Schedule. The information set forth in the
Mortgage
Loan Schedule with respect to the Mortgage Loans is true and
correct in all
material respects (and contains all the items listed in the
definition of
"Mortgage Loan Schedule") as of the dates of the information set
forth therein
or, if not set forth therein, and in all events no earlier than, as
of the
respective Cut-off Dates for the Mortgage Loans.
2. Ownership of Mortgage Loans. Immediately prior to the transfer
of
the Mortgage Loans to the Purchaser, the Seller had good title to,
and was the
sole owner of, each Mortgage Loan. The Seller has full right, power
and
authority to transfer and assign each Mortgage Loan to or at the
direction of
the Purchaser free and clear of any and all pledges, liens,
charges, security
interests, participation interests and/or other interests and
encumbrances
(except for certain servicing rights as provided in the Pooling and
Servicing
Agreement, any permitted subservicing agreements and servicing
rights purchase
agreements pertaining thereto). The Seller has validly and
effectively
conveyed to the Purchaser all legal and beneficial interest in and
to each
Mortgage Loan free and clear of any pledge, lien, charge, security
interest or
other encumbrance (except for certain servicing rights as provided
in the
Pooling and Servicing Agreement, any permitted subservicing
agreements and
servicing rights purchase agreements pertaining thereto); provided
that
recording and/or filing of various transfer documents are to be
completed
after the Closing Date as contemplated hereby and by the Pooling
and Servicing
Agreement. The sale of the Mortgage Loans to the Purchaser or its
designee
does not require the Seller to obtain any governmental or
regulatory approval
or consent that has not been obtained. Each Mortgage Note is, or
shall be as
of the Closing Date, properly endorsed to the Purchaser or its
designee and
each such endorsement is, or shall be as of the Closing Date,
genuine.
3. Payment Record. No scheduled payment of principal and
interest
under any Mortgage Loan was 30 days or more past due as of the Due
Date for
such Mortgage Loan in June 2005 without giving effect to any
applicable grace
period, nor was any such payment 30 days or more delinquent in
the
twelve-month period immediately preceding the Due Date for such
Mortgage Loan
in June 2005, without giving effect to any applicable grace
period.
4. Lien; Valid Assignment. Each Mortgage related to and delivered
in
connection with each Mortgage Loan constitutes a valid and, subject
to the
limitations and exceptions set forth in representation 13 below,
enforceable
first priority lien upon the related Mortgaged Property, prior to
all other
liens and encumbrances, and there are no liens and/or encumbrances
that are
pari passu with the lien of such Mortgage, in any event subject,
however, to
the following (collectively, the "Permitted Encumbrances"): (a) the
lien for
current real estate taxes, ground rents, water charges, sewer rents
and
assessments not yet delinquent or accruing
<PAGE>
interest or penalties; (b) covenants, conditions and restrictions,
rights of
way, easements and other matters that are of public record and/or
are referred
to in the related lender's title insurance policy (or, if not yet
issued,
referred to in a pro forma title policy or a "marked-up" commitment
binding
upon the title insurer); (c) exceptions and exclusions specifically
referred
to in such lender's title insurance policy (or, if not yet issued,
referred to
in a pro forma title policy or "marked-up" commitment binding upon
the title
insurer); (d) other matters to which like properties are commonly
subject; (e)
the rights of tenants (as tenants only) under leases (including
subleases)
pertaining to the related Mortgaged Property; (f) if such Mortgage
Loan
constitutes a Cross-Collateralized Mortgage Loan, the lien of the
Mortgage for
another Mortgage Loan contained in the same Crossed Group; and (g)
if the
related Mortgaged Property consists of one or more units in a
condominium, the
related condominium declaration. The Permitted Encumbrances do
not,
individually or in the aggregate, materially interfere with the
security
intended to be provided by the related Mortgage, the current
principal use of
the related Mortgaged Property, the Value of the Mortgaged Property
or the
current ability of the related Mortgaged Property to generate
income
sufficient to service such Mortgage Loan. The related assignment of
such
Mortgage executed and delivered in favor of the Trustee is in
recordable form
(but for insertion of the name and address of the assignee and any
related
recording information which is not yet available to the Seller)
and
constitutes a legal, valid, binding and, subject to the limitations
and
exceptions set forth in representation 13 below, enforceable
assignment of
such Mortgage from the relevant assignor to the Trustee.
5. Assignment of Leases and Rents. There exists, as part of the
related Mortgage File, an Assignment of Leases (either as a
separate
instrument or as part of the Mortgage) that relates to and was
delivered in
connection with each Mortgage Loan and that establishes and creates
a valid,
subsisting and, subject to the limitations and exceptions set forth
in
representation 13 below, enforceable first priority lien on and
security
interest in, subject to applicable law, the property, rights and
interests of
the related Mortgagor described therein, except for Permitted
Encumbrances and
except that a license may have been granted to the related
Mortgagor to
exercise certain rights and perform certain obligations of the
lessor under
the relevant lease or leases, including, without limitation, the
right to
operate the related leased property so long as no event of default
has
occurred under such Mortgage Loan; and each assignor thereunder has
the full
right to assign the same. The related assignment of any Assignment
of Leases
not included in a Mortgage, executed and delivered in favor of the
Trustee is
in recordable form (but for insertion of the name of the assignee
and any
related recording information which is not yet available to the
Seller), and
constitutes a legal, valid, binding and, subject to the limitations
and
exceptions set forth in representation 13 below, enforceable
assignment of
such Assignment of Leases from the relevant assignor to the
Trustee. The
related Mortgage or related Assignment of Leases, subject to
applicable law,
provides for the appointment of a receiver for the collection of
rents or for
the related mortgagee to enter into possession to collect the rents
or
provides for rents to be paid directly to the related mortgagee, if
there is
an event of default. No person other than the related Mortgagor
owns any
interest in any payments due under the related leases on which the
Mortgagor
is the landlord, covered by the related Assignment of Leases.
6. Mortgage Status; Waivers and Modifications. In the case of
each
Mortgage Loan, except by a written instrument which has been
delivered to the
Purchaser or its designee as a part of the related Mortgage File,
(a) the
related Mortgage (including any
I-2
<PAGE>
amendments or supplements thereto included in the related Mortgage
File) has
not been impaired, waived, modified, altered, satisfied,
canceled,
subordinated or rescinded, (b) neither the related Mortgaged
Property nor any
material portion thereof has been released from the lien of such
Mortgage and
(c) the related Mortgagor has not been released from its
obligations under
such Mortgage, in whole or in material part. With respect to each
Mortgage
Loan, since the later of (a) May 31, 2005 and (b) the closing date
of such
Mortgage Loan, the Seller has not executed any written instrument
that (i)
impaired, satisfied, canceled, subordinated or rescinded such
Mortgage Loan,
(ii) waived, modified or altered any material term of such Mortgage
Loan,
(iii) released the Mortgaged Property or any material portion
thereof from the
lien of the related Mortgage, or (iv) released the related
Mortgagor from its
obligations under such Mortgage Loan in whole or material part. For
avoidance
of doubt, the preceding sentence does not relate to any release of
escrows by
the Seller or a servicer on its behalf.
7. Condition of Property; Condemnation. In the case of each
Mortgage
Loan, except as set forth in an engineering report prepared by an
independent
engineering consultant in connection with the origination of such
Mortgage
Loan, the related Mortgaged Property is, to the Seller's knowledge,
in good
repair and free and clear of any damage that would materially and
adversely
affect its value as security for such Mortgage Loan (except in any
such case
where an escrow of funds, letter of credit or insurance coverage
exists
sufficient to effect the necessary repairs and maintenance). As of
the date of
origination of the Mortgage Loan, there was no proceeding pending
for the
condemnation of all or any material part of the related Mortgaged
Property. As
of the Closing Date, the Seller has not received notice and has no
knowledge
of any proceeding pending for the condemnation of all or any
material portion
of the Mortgaged Property securing any Mortgage Loan. As of the
date of
origination of each Mortgage Loan and, to the Seller's knowledge,
as of the
date hereof, (a) none of the material improvements on the related
Mortgaged
Property encroach upon the boundaries and, to the extent in effect
at the time
of construction, do not encroach upon the building restriction
lines of such
property, and none of the material improvements on the related
Mortgaged
Property encroached over any easements, except, in each case,
for
encroachments that are insured against by the lender's title
insurance policy
referred to in representation 8 below or that do not materially and
adversely
affect the Value or current use of such Mortgaged Property and (b)
no
improvements on adjoining properties encroached upon such Mortgaged
Property
so as to materially and adversely affect the Value of such
Mortgaged Property,
except those encroachments that are insured against by the lender's
title
insurance policy referred to in representation 8 below.
8. Title Insurance. Each Mortgaged Property securing a Mortgage
Loan
is covered by an American Land Title Association (or an equivalent
form of)
lender's title insurance policy (the "Title Policy") (or, if such
policy has
yet to be issued, by a pro forma policy or a "marked up" commitment
binding on
the title insurer) in the original principal amount of such
Mortgage Loan
after all advances of principal, insuring that the related Mortgage
is a valid
first priority lien on such Mortgaged Property, subject only to the
Permitted
Encumbrances, except that in the case of a Mortgage Loan as to
which the
related Mortgaged Property is made up of more than one parcel of
property,
each of which is secured by a separate Mortgage, such Mortgage (and
therefore
the related Title Policy) may be in an amount less than the
original principal
amount of the Mortgage Loan, but is not less than the allocated
amount of
subject parcel constituting a portion of the related Mortgaged
Property. Such
Title Policy (or, if
I-3
<PAGE>
it has yet to be issued, the coverage to be provided thereby) is in
full force
and effect, all premiums thereon have been paid, no material claims
have been
made thereunder and no claims have been paid thereunder. No holder
of the
related Mortgage has done, by act or omission, anything that would
materially
impair the coverage under such Title Policy. Immediately following
the
transfer and assignment of the related Mortgage Loan to the
Trustee, such
Title Policy (or, if it has yet to be issued, the coverage to be
provided
thereby) inures to the benefit of the Trustee as sole insured
without the
consent of or notice to the insurer. Such Title Policy contains no
exclusion
for whether, or it affirmatively insures (unless the related
Mortgaged
Property is located in a jurisdiction where such affirmative
insurance is not
available) that, (a) the related Mortgaged Property has access to a
public
road, and (b) the area shown on the survey, if any, reviewed or
prepared in
connection with the origination of the related Mortgage Loan is the
same as
the property legally described in the related Mortgage.
9. No Holdback. The proceeds of each Mortgage Loan have been
fully
disbursed (except in those cases where the full amount of the
Mortgage Loan
has been disbursed but a portion thereof is being held in escrow or
reserve
accounts documented as part of the Mortgage Loan documents and the
rights to
which are transferred to the Trustee, pending the satisfaction of
certain
conditions relating to leasing, repairs or other matters with
respect to the
related Mortgaged Property), and there is no obligation for future
advances
with respect thereto.
10. Mortgage Provisions. The Mortgage Loan documents for each
Mortgage Loan, together with applicable state law, contain
customary and,
subject to the limitations and exceptions set forth in
representation 13
below, enforceable provisions such as to render the rights and
remedies of the
holder thereof adequate for the practical realization against the
related
Mortgaged Property of the principal benefits of the security
intended to be
provided thereby, including, without limitation, foreclosure or
similar
proceedings (as applicable for the jurisdiction where the related
Mortgaged
Property is located). None of the Mortgage Loan documents contains
any
provision that expressly excuses the related Mortgagor from
obtaining and
maintaining insurance coverage for acts of terrorism.
11. Trustee under Deed of Trust. If the Mortgage for any
Mortgage
Loan is a deed of trust, then (a) a trustee, duly qualified under
applicable
law to serve as such, has either been properly designated and
currently so
serves or may be substituted in accordance with the Mortgage and
applicable
law, and (b) no fees or expenses are payable to such trustee by the
Seller,
the Purchaser or any transferee thereof except in connection with a
trustee's
sale after default by the related Mortgagor or in connection with
any full or
partial release of the related Mortgaged Property or related
security for such
Mortgage Loan.
12. Environmental Conditions. Except in the case of the
Mortgaged
Properties identified on Annex B hereto (as to which properties the
only
environmental investigation conducted in connection with the
origination of
the related Mortgage Loan related to asbestos-containing materials
and
lead-based paint), (a) an environmental site assessment meeting
ASTM standards
and covering all environmental hazards typically assessed for
similar
properties including use, type and tenants of the related Mortgaged
Property,
a transaction screen meeting ASTM standards or an update of a
previously
conducted environmental site assessment (which update may have been
performed
pursuant to a database update), was performed by an independent
third-party
environmental consultant (licensed to the extent required by
applicable
I-4
<PAGE>
state law) with respect to each Mortgaged Property securing a
Mortgage Loan in
connection with the origination of such Mortgage Loan, (b) the
report of each
such assessment, update or screen, if any (an "Environmental
Report"), is
dated no earlier than (or, alternatively, has been updated within)
twelve (12)
months prior to the date hereof, (c) a copy of each such
Environmental Report
has been delivered to the Purchaser, and (d) either: (i) no such
Environmental
Report, if any, reveals that as of the date of the report there is
a material
violation of applicable environmental laws with respect to any
known
circumstances or conditions relating to the related Mortgaged
Property; or
(ii) if any such Environmental Report does reveal any such
circumstances or
conditions with respect to the related Mortgaged Property and the
same have
not been subsequently remediated in all material respects, then one
or more of
the following are true--(A) one or more parties not related to the
related
Mortgagor and collectively having financial resources reasonably
estimated to
be adequate to cure the violation was identified as the responsible
party or
parties for such conditions or circumstances, and such conditions
or
circumstances do not materially impair the Value of the related
Mortgaged
Property, (B) the related Mortgagor was required to provide
additional
security reasonably estimated to be adequate to cure the violations
and/or to
obtain and, for the period contemplated by the related Mortgage
Loan
documents, maintain an operations and maintenance plan, (C) the
related
Mortgagor, or other responsible party, provided a "no further
action" letter
or other evidence that would be acceptable to a reasonably prudent
commercial
mortgage lender, that applicable federal, state or local
governmental
authorities had no current intention of taking any action, and are
not
requiring any action, in respect of such conditions or
circumstances, (D) such
conditions or circumstances were investigated further and based
upon such
additional investigation, a qualified environmental consultant
recommended no
further investigation or remediation, (E) the expenditure of funds
reasonably
estimated to be necessary to effect such remediation is not greater
than 2% of
the outstanding principal balance of the related Mortgage Loan, (F)
there
exists an escrow of funds reasonably estimated to be sufficient for
purposes
of effecting such remediation, (G) the related Mortgaged Property
is insured
under a policy of insurance, subject to certain per occurrence and
aggregate
limits and a deductible, against certain losses arising from
such
circumstances and conditions or (H) a responsible party provided a
guaranty or
indemnity to the related Mortgagor to cover the costs of any
required
investigation, testing, monitoring or remediation and, as of the
date of
origination of the related Mortgage Loan, such responsible party
had financial
resources reasonably estimated to be adequate to cure the subject
violation in
all material respects. To the Seller's actual knowledge and without
inquiry
beyond the related Environmental Report, there are no significant
or material
circumstances or conditions with respect to such Mortgaged Property
not
revealed in any such Environmental Report, where obtained, or in
any Mortgagor
questionnaire delivered to the Seller in connection with the issue
of any
related environmental insurance policy, if applicable, that would
require
investigation or remediation by the related Mortgagor under, or
otherwise be a
material violation of, any applicable environmental law. The
Mortgage Loan
documents for each Mortgage Loan require the related Mortgagor to
comply in
all material respects with all applicable federal, state and
local
environmental laws and regulations. Each of the Mortgage Loans
identified on
Annex C hereto is covered by a secured creditor impaired
property
environmental insurance policy and each such policy is
noncancellable during
its term, is in the amount at least equal to 125% of the principal
balance of
the Mortgage Loan, has a term ending no sooner than the date which
is five
years after the maturity date of the Mortgage Loan to which it
relates and
either does not provide for a deductible or the deductible amount
is held in
escrow and all premiums have been paid in
I-5
<PAGE>
full. Each Mortgagor represents and warrants in the related
Mortgage Loan
documents that except as set forth in certain environmental reports
and to its
knowledge it has not used, caused or permitted to exist and will
not use,
cause or permit to exist on the related Mortgaged Property any
hazardous
materials in any manner which violates federal, state or local
laws,
ordinances, regulations, orders, directives or policies governing
the use,
storage, treatment, transportation, manufacture, refinement,
handling,
production or disposal of hazardous materials. The related
Mortgagor (or
affiliate thereof) has agreed to indemnify, defend and hold the
Seller and its
successors and assigns harmless from and against any and all
losses,
liabilities, damages, injuries, penalties, fines, out-of-pocket
expenses and
claims of any kind whatsoever (including attorneys' fees and costs)
paid,
incurred or suffered by or asserted against, any such party
resulting from a
breach of environmental representations, warranties or covenants
given by the
Mortgagor in connection with such Mortgage Loan.
13. Loan Document Status. Each Mortgage Note, Mortgage, and
each
other agreement executed by or on behalf of the related Mortgagor
with respect
to each Mortgage Loan is the legal, valid and binding obligation of
the maker
thereof (subject to any non-recourse provisions contained in any of
the
foregoing agreements and any applicable state anti-deficiency or
market value
limit deficiency legislation), enforceable in accordance with its
terms,
except as such enforcement may be limited by (i) bankruptcy,
insolvency,
reorganization, receivership, fraudulent transfer and conveyance or
other
similar laws affecting the enforcement of creditors' rights
generally, (ii)
general principles of equity (regardless of whether such
enforcement is
considered in a proceeding in equity or at law) and (iii) public
policy
considerations underlying applicable securities laws, to the extent
that such
public policy considerations limit the enforceability of provisions
that
purport to provide indemnification from liabilities under
applicable
securities laws, and except that certain provisions in such loan
documents may
be further limited or rendered unenforceable by applicable law, but
(subject
to the limitations set forth in the foregoing clauses (i) and (ii))
such
limitations or unenforceability will not render such loan documents
invalid as
a whole or substantially interfere with the mortgagee's realization
of the
principal benefits and/or security provided thereby. There is no
valid
defense, counterclaim or right of offset or rescission available to
the
related Mortgagor with respect to such Mortgage Note, Mortgage or
other
agreements that would deny the mortgagee the principal benefits
intended to be
provided thereby, except in each case, with respect to the
enforceability of
any provisions requiring the payment of default interest, late
fees,
additional interest, prepayment premiums or yield maintenance
charges.
14. Insurance. Except in certain cases where tenants, having a
net
worth of at least $50,000,000 or an investment grade credit rating
(and, if
rated by Fitch, a credit rating of at least "A-" by Fitch) and
obligated to
maintain the insurance described in this paragraph, are allowed to
self-insure
the related Mortgaged Properties, all improvements upon each
Mortgaged
Property securing a Mortgage Loan are insured under a fire and
extended perils
insurance (or the equivalent) policy, in an amount at least equal
to the
lesser of the outstanding principal balance of such Mortgage Loan
and 100% of
the full insurable replacement cost of the improvements located on
the related
Mortgaged Property, and if applicable, the related hazard insurance
policy
contains appropriate endorsements to avoid the application of
co-insurance and
does not permit reduction in insurance proceeds for depreciation.
Each
Mortgaged Property is also covered by comprehensive general
liability
insurance in amounts customarily required by prudent commercial
mortgage
lenders for properties of similar types. Each Mortgaged Property
securing
I-6
<PAGE>
a Mortgage Loan is the subject of a business interruption or rent
loss
insurance policy providing coverage for at least twelve (12) months
(or a
specified dollar amount which is reasonably estimated to cover no
less than
twelve (12) months of rental income), unless such Mortgaged
Property
constitutes a manufactured housing community. If any portion of
the
improvements on a Mortgaged Property securing any Mortgage Loan
was, at the
time of the origination of such Mortgage Loan, in an area
identified in the
Federal Register by the Flood Emergency Management Agency as a
special flood
hazard area (Zone A or Zone V), and flood insurance was available,
a flood
insurance policy is in effect with a generally acceptable insurance
carrier,
in an amount representing coverage not less than the least of: (1)
the full
insurable value of the related Mortgaged Property or (2) the
maximum amount of
insurance available. Each Mortgaged Property located in California
or in
seismic zones 3 and 4 is covered by seismic insurance to the extent
such
Mortgaged Property has a probable maximum loss of greater than
twenty percent
(20%) of the replacement value of the related improvements,
calculated using
methodology acceptable to a reasonably prudent commercial mortgage
lender with
respect to similar properties in the same area or earthquake zone.
Each
Mortgaged Property located within Florida or within 25 miles of the
coast of
North Carolina, South Carolina, Georgia, Alabama, Mississippi,
Louisiana or
Texas is insured by windstorm insurance in an amount at least equal
to the
lesser of (i) the outstanding principal balance of the related
Mortgage Loan
and (ii) 100% of the insurable replacement cost of the improvements
located on
such Mortgaged Property (less physical depreciation). All such
hazard and
flood insurance policies contain a standard mortgagee clause for
the benefit
of the holder of the related Mortgage, its successors and assigns,
as
mortg
