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EXHIBIT 10.4
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MORTGAGE LOAN PURCHASE AGREEMENT
between
MORGAN STANLEY MORTGAGE CAPITAL INC.
as Seller
and
BEAR STEARNS COMMERCIAL MORTGAGE SECURITIES INC.
as Purchaser
Dated as of April 5, 2007
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TABLE OF CONTENTS
1. AGREEMENT TO
PURCHASE..................................................3
2. CONVEYANCE OF MORTGAGE
LOANS...........................................3
3. EXAMINATION OF MORTGAGE FILES AND DUE DILIGENCE
REVIEW................10
4. REPRESENTATIONS, WARRANTIES AND COVENANTS OF SELLER AND
PURCHASER.....12
5. REMEDIES UPON BREACH OF REPRESENTATIONS AND WARRANTIES MADE
BY
SELLER................................................................15
6.
CLOSING...............................................................20
7. CLOSING
DOCUMENTS.....................................................21
8.
COSTS.................................................................24
9.
NOTICES...............................................................24
10. SEVERABILITY OF
PROVISIONS............................................24
11. FURTHER
ASSURANCES....................................................24
12.
SURVIVAL..............................................................24
13. GOVERNING
LAW.........................................................25
14. BENEFITS OF MORTGAGE LOAN PURCHASE
AGREEMENT..........................25
15.
MISCELLANEOUS.........................................................25
16. ENTIRE
AGREEMENT......................................................25
Exhibit 1 Mortgage Loan Schedule
Exhibit 2 Representations and Warranties
Exhibit 3 Bill of Sale
Exhibit 4 Power of Attorney
Index of Defined Terms
Affected
Loan(s)......................................................17
Agreement..............................................................2
Certificate Purchase
Agreement.........................................2
Certificates...........................................................2
Closing
Date...........................................................3
Collateral
Information................................................11
Crossed Mortgage
Loans................................................17
Defective Mortgage
Loan...............................................17
Final Judicial
Determination..........................................19
Indemnification
Agreement.............................................13
Initial
Purchasers.....................................................2
Master
Servicer........................................................2
Material
Breach.......................................................16
Material Document
Defect..............................................16
Memorandum.............................................................2
MERS...................................................................5
Mortgage
File..........................................................4
Mortgage Loan
Schedule.................................................3
Mortgage
Loans.........................................................2
Officer's
Certificate..................................................7
Other Mortgage
Loans...................................................2
Pooling and Servicing
Agreement........................................2
Private
Certificates...................................................2
Prospectus
Supplement..................................................2
Public
Certificates....................................................2
Purchaser..............................................................2
Repurchased
Loan......................................................17
Seller.................................................................2
Special
Servicer.......................................................2
Trust..................................................................2
Trustee................................................................2
Underwriters...........................................................2
Underwriting
Agreement.................................................2
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MORTGAGE LOAN PURCHASE AGREEMENT
(MSMC LOANS)
Mortgage Loan Purchase Agreement ("Agreement"), dated as of
April 5, 2007,
between Morgan Stanley Mortgage Capital Inc. ("Seller") and Bear
Stearns
Commercial Mortgage Securities Inc. ("Purchaser").
Seller agrees to sell and Purchaser agrees to purchase certain
mortgage loans
listed on Exhibit 1 hereto (the "Mortgage Loans") as described
herein. Purchaser
will convey the Mortgage Loans to a trust (the "Trust") created
pursuant to a
Pooling and Servicing Agreement (the "Pooling and Servicing
Agreement"), to be
dated as of April 1, 2007 between Purchaser, as depositor, Wells
Fargo Bank,
National Association, as master servicer (the "Master
Servicer"), Centerline
Servicing Inc., as special servicer (the "Special Servicer"),
LaSalle Bank
National Association, as trustee and custodian (the "Trustee")
and Wells Fargo
Bank, National Association, as paying agent, certificate
registrar and
authenticating agent. In exchange for the Mortgage Loans and
certain other
mortgage loans to be purchased by Purchaser (collectively the
"Other Mortgage
Loans"), the Trust will issue to the Depositor pass-through
certificates to be
known as Bear Stearns Commercial Mortgage Securities Inc.,
Commercial Mortgage
Pass-Through Certificates, Series 2007-TOP26 (the
"Certificates"). The
Certificates will be issued pursuant to the Pooling and
Servicing Agreement.
Capitalized terms used herein but not defined herein shall have
the meanings
assigned to them in the Pooling and Servicing Agreement.
The Class A-1, Class A-2, Class A-3, Class A-AB, Class A-4,
Class A-1A, Class
A-M and Class A-J Certificates (the "Public Certificates") will
be sold by
Purchaser to Bear, Stearns & Co. Inc. and Morgan Stanley
& Co. Incorporated (the
"Underwriters"), pursuant to an Underwriting Agreement, between
Purchaser and
the Underwriters, dated April 5, 2007 (the "Underwriting
Agreement"), and the
Class X-1, Class X-2, Class B, Class C, Class D, Class E, Class
F, Class G,
Class H, Class J, Class K, Class L, Class M, Class N, Class O,
Class P, Class
R-I, Class R-II and Class R-III Certificates (the "Private
Certificates") will
be sold by Purchaser to Bear, Stearns & Co. Inc. and Morgan
Stanley & Co.
Incorporated (the "Initial Purchasers") pursuant to a
Certificate Purchase
Agreement, between Purchaser and the Initial Purchasers, dated
April 5, 2007
(the "Certificate Purchase Agreement"). The Underwriters will
offer the Public
Certificates for sale publicly pursuant to a Prospectus dated
September 13,
2006, as supplemented by a Prospectus Supplement dated April 5,
2007 (together,
the "Prospectus Supplement") and the Initial Purchasers will
offer the Private
Certificates for sale in transactions exempt from the
registration requirements
of the Securities Act of 1933 pursuant to a Private Placement
Memorandum dated
April 5, 2007 (the "Memorandum").
In consideration of the mutual agreements contained herein,
Seller and Purchaser
hereby agree as follows:
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1. AGREEMENT TO PURCHASE.
1.1 Seller agrees to sell, and Purchaser agrees to purchase, on
a servicing
released basis, the Mortgage Loans identified on the schedule
(the "Mortgage
Loan Schedule") annexed hereto as Exhibit 1, as such schedule
may be amended to
reflect the actual Mortgage Loans accepted by Purchaser pursuant
to the terms
hereof. The Cut-Off Date with respect to the Mortgage Loans is
April 1, 2007.
The Mortgage Loans will have an aggregate principal balance 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 received, of $460,808,205. The
sale of the
Mortgage Loans shall take place on April 18, 2007 or such other
date as shall be
mutually acceptable to the parties hereto (the "Closing Date").
The purchase
price to be paid by Purchaser for the Mortgage Loans shall equal
the amount set
forth as such purchase price in a letter dated as of the date
hereof, between
the parties to this Agreement and entered into in connection
with this Agreement
and the issuance of the Certificates, which purchase price
excludes accrued
interest and applicable deal expenses. The purchase price shall
be paid to
Seller by wire transfer in immediately available funds on the
Closing Date.
1.2 On the Closing Date, Purchaser will assign to the Trustee
pursuant to the
Pooling and Servicing Agreement all of its right, title and
interest in and to
the Mortgage Loans and its rights under this Agreement (to the
extent set forth
in Section 14 hereof), and the Trustee shall succeed to such
right, title and
interest in and to the Mortgage Loans and Purchaser's rights
under this
Agreement (to the extent set forth in Section 14 hereof).
2. CONVEYANCE OF MORTGAGE LOANS.
2.1 Effective as of the Closing Date, subject only to receipt of
the
consideration referred to in Section 1 hereof and the
satisfaction of the
conditions specified in Sections 6 and 7 hereof, Seller does
hereby transfer,
assign, set over and otherwise convey to Purchaser, without
recourse, except as
specifically provided herein all the right, title and interest
of Seller, with
the understanding that a Servicing Rights Purchase and Sale
Agreement, dated
April 1, 2007, will be executed by Seller and the Master
Servicer, in and to the
Mortgage Loans identified on the Mortgage Loan Schedule as of
the Closing Date.
The Mortgage Loan Schedule, as it may be amended from time to
time on or prior
to the Closing Date, shall conform to the requirements of this
Agreement and the
Pooling and Servicing Agreement. In connection with such
transfer and
assignment, Seller shall deliver to or on behalf of the Trustee,
on behalf of
Purchaser, on or prior to the Closing Date, the Mortgage Note
(as described in
clause 2.2.1 hereof) for each Mortgage Loan and on or prior to
the fifth
Business Day after the Closing Date, five limited powers of
attorney
substantially in the form attached hereto as Exhibit 4 in favor
of the Trustee
and the Special Servicer to empower the Trustee and, in the
event of the failure
or incapacity of the Trustee, the Special Servicer, to submit
for recording, at
the expense of Seller, any mortgage loan documents required to
be recorded as
described in the Pooling and Servicing Agreement and any
intervening assignments
with evidence of recording thereon that are required to be
included in the
Mortgage Files (so long as original counterparts have previously
been delivered
to the Trustee). Seller agrees to reasonably cooperate with the
Trustee and the
Special Servicer in connection with any additional powers of
attorney or
revisions thereto that are requested by such parties for
purposes of such
recordation. The parties hereto agree that no such power of
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attorney shall be used with respect to any Mortgage Loan by or
under
authorization by any party hereto except to the extent that the
absence of a
document described in the second preceding sentence with respect
to such
Mortgage Loan remains unremedied as of the earlier of (i) the
date that is 180
days following the delivery of notice of such absence to Seller,
but in no event
earlier than 18 months from the Closing Date, and (ii) the date
(if any) on
which such Mortgage Loan becomes a Specially Serviced Mortgage
Loan. The Trustee
shall submit such documents, at Seller's expense, after the
periods set forth
above, provided, however, the Trustee shall not submit such
assignments for
recording if Seller produces evidence that it has sent any such
assignment for
recording and certifies that Seller is awaiting its return from
the applicable
recording office. In addition, not later than the 30th day
following the Closing
Date, Seller shall deliver to or on behalf of the Trustee each
of the remaining
documents or instruments specified in Section 2.2 hereof (with
such exceptions
as are permitted by this Section 2) with respect to each
Mortgage Loan (each, a
"Mortgage File"). (Seller acknowledges that the term "without
recourse" does not
modify the duties of Seller under Section 5 hereof.)
2.2 All Mortgage Files, or portions thereof, delivered prior to
the Closing Date
are to be held by or on behalf of the Trustee in escrow on
behalf of Seller at
all times prior to the Closing Date. The Mortgage Files shall be
released from
escrow upon closing of the sale of the Mortgage Loans and
payments of the
purchase price therefor as contemplated hereby. The Mortgage
File for each
Mortgage Loan shall contain the following documents:
2.2.1 The original Mortgage Note bearing all intervening
endorsements,
endorsed "Pay to the order of LaSalle Bank National Association,
as Trustee
Bear Stearns Commercial Mortgage Securities Inc., Commercial
Mortgage
Pass-Through Certificates, Series 2007-TOP26, without recourse,
representation
or warranty" or if the original Mortgage Note is not included
therein, then a
lost note affidavit, with a copy of the Mortgage Note attached
thereto;
2.2.2 The original Mortgage, with evidence of recording thereon,
and, if
the Mortgage was executed pursuant to a power of attorney, a
certified true copy
of the power of attorney certified by the public recorder's
office, with
evidence of recording thereon (if recording is customary in the
jurisdiction in
which such power of attorney was executed), or certified by a
title insurance
company or escrow company to be a true copy thereof; provided
that if such
original Mortgage cannot be delivered with evidence of recording
thereon on or
prior to the 45th day following the Closing Date because of a
delay caused by
the public recording office where such original Mortgage has
been delivered for
recordation or because such original Mortgage has been lost,
Seller shall
deliver or cause to be delivered to the Trustee a true and
correct copy of such
Mortgage, together with (i) in the case of a delay caused by the
public
recording office, an Officer's Certificate (as defined below) of
Seller stating
that such original Mortgage has been sent to the appropriate
public recording
official for recordation or (ii) in the case of an original
Mortgage that has
been lost after recordation, a certification by the appropriate
county recording
office where such Mortgage is recorded that such copy is a true
and complete
copy of the original recorded Mortgage;
2.2.3 The originals of all agreements modifying a Money Term or
other
material modification, consolidation and extension agreements,
if any, with
evidence of recording thereon, or if any such original
modification,
consolidation or extension agreement has been delivered to the
appropriate
recording office for recordation and either has not yet been
returned
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on or prior to the 45th day following the Closing Date with
evidence of
recordation thereon or has been lost after recordation, a true
copy of such
modification, consolidation or extension certified by Seller
together with (i)
in the case of a delay caused by the public recording office, an
Officer's
Certificate of Seller stating that such original modification,
consolidation or
extension agreement has been dispatched or sent to the
appropriate public
recording official for recordation or (ii) in the case of an
original
modification, consolidation or extension agreement that has been
lost after
recordation, a certification by the appropriate county recording
office where
such document is recorded that such copy is a true and complete
copy of the
original recorded modification, consolidation or extension
agreement, and the
originals of all assumption agreements, if any;
2.2.4 An original Assignment of Mortgage for each Mortgage Loan,
in form
and substance acceptable for recording, signed by the holder of
record in favor
of "LaSalle Bank National Association, as Trustee for Bear
Stearns Commercial
Mortgage Securities Inc., Commercial Mortgage Pass-Through
Certificates, Series
2007-TOP26," provided, if the related Mortgage has been recorded
in the name of
Mortgage Electronic Registration Systems, Inc. ("MERS") or its
designee, no such
assignments will be required to be submitted for recording or
filing and
instead, Seller shall take all actions as are necessary to cause
the Trustee to
be shown as the owner of the related Mortgage on the record of
MERS for purposes
of the system of recording transfers of beneficial ownership of
mortgages
maintained by MERS and shall deliver to the Master Servicer and
the Special
Servicer evidence confirming that the Trustee is shown as the
owner on the
record of MERS;
2.2.5 Originals of all intervening assignments of Mortgage
(except with
respect to any Mortgage that has been recorded in the name of
MERS or its
designees), if any, with evidence of recording thereon or, if
such original
assignments of Mortgage have been delivered to the appropriate
recorder's office
for recordation, certified true copies of such assignments of
Mortgage certified
by Seller, or in the case of an original blanket intervening
assignment of
Mortgage retained by Seller, a copy thereof certified by Seller
or, if any
original intervening assignment of Mortgage has not yet been
returned on or
prior to the 45th day following the Closing Date from the
applicable recording
office or has been lost, a true and correct copy thereof,
together with (i) in
the case of a delay caused by the public recording office, an
Officer's
Certificate of Seller stating that such original intervening
assignment of
Mortgage has been sent to the appropriate public recording
official for
recordation or (ii) in the case of an original intervening
Assignment of
Mortgage that has been lost after recordation, a certification
by the
appropriate county recording office where such assignment is
recorded that such
copy is a true and complete copy of the original recorded
intervening Assignment
of Mortgage;
2.2.6 If the related Assignment of Leases is separate from the
Mortgage,
the original of such Assignment of Leases with evidence of
recording thereon or,
if such Assignment of Leases has not been returned on or prior
to the 45th day
following the Closing Date from the applicable public recording
office, a copy
of such Assignment of Leases certified by Seller to be a true
and complete copy
of the original Assignment of Leases submitted for recording,
together with (i)
an original of each assignment of such Assignment of Leases with
evidence of
recording thereon and showing a complete recorded chain of
assignment from the
named assignee to the holder of record, and if any such
assignment of such
Assignment of Leases has not been returned from the applicable
public recording
office, a copy of such assignment certified by Seller to be a
true and
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complete copy of the original assignment submitted for
recording, and (ii) an
original assignment of such Assignment of Leases, in recordable
form, signed by
the holder of record in favor of "LaSalle Bank National
Association, as Trustee
for Bear Stearns Commercial Mortgage Securities Inc., Commercial
Mortgage
Pass-Through Certificates, Series 2007-TOP26," which assignment
may be effected
in the related Assignment of Mortgage, provided, if the related
Mortgage has
been recorded in the name of MERS or its designee, no assignment
of Assignment
of Leases in favor of the Trustee will be required to be
recorded or delivered
and instead, Seller shall take all actions as are necessary to
cause the Trustee
to be shown as the owner of the related Mortgage on the record
of MERS for
purposes of the system of recording transfers of beneficial
ownership of
mortgages maintained by MERS and shall deliver to the Master
Servicer and the
Special Servicer evidence confirming that the Trustee is shown
as the owner on
the record of MERS;
2.2.7 The original of each guaranty, if any, constituting
additional
security for the repayment of such Mortgage Loan;
2.2.8 The original Title Insurance Policy, or in the event such
original
Title Insurance Policy has not been issued, an original binder
or actual title
commitment or a copy thereof certified by the title company with
the original
Title Insurance Policy to follow within 180 days of the Closing
Date or a
preliminary title report binding on the title company with an
original Title
Insurance Policy to follow within 180 days of the Closing
Date;
2.2.9 (A) UCC financing statements (together with all
assignments thereof)
and (B) UCC-2 or UCC-3 financing statements to the Trustee
executed and
delivered in connection with the Mortgage Loan, provided, if the
related
Mortgage has been recorded in the name of MERS or its designee,
no such
financing statements will be required to be recorded or
delivered and instead,
Seller shall take all actions as are necessary to cause the
Trustee to be shown
as the owner of the related Mortgage on the record of MERS for
purposes of the
system of recording transfers of beneficial ownership of
mortgages maintained by
MERS and shall deliver to the Master Servicer and the Special
Servicer evidence
confirming that the Trustee is shown as the owner on the record
of MERS;
2.2.10 Copies of the related ground lease(s), if any, to any
Mortgage Loan
where the Mortgagor is the lessee under such ground lease and
there is a lien in
favor of the mortgagee in such lease;
2.2.11 Copies of any loan agreements, lock-box agreements
and
intercreditor agreements (including, without limitation, any
Intercreditor
Agreement, and a copy (that is, not the original) of the
mortgage note
evidencing the related B Note), if any, related to any Mortgage
Loan;
2.2.12 Either (A) the original of each letter of credit, if
any,
constituting additional collateral for such Mortgage Loan, which
shall be
assigned and delivered to the Trustee on behalf of the Trust
with a copy to be
held by the Primary Servicer (or the Master Servicer), and
applied, drawn,
reduced or released in accordance with documents evidencing or
securing the
applicable Mortgage Loan, the Pooling and Servicing Agreement
and the Primary
Servicing Agreement or (B) the original of each letter of
credit, if any,
constituting additional collateral for such Mortgage Loan, which
shall be held
by the Primary Servicer (or the Master Servicer) on
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behalf of the Trustee, with a copy to be held by the Trustee,
and applied,
drawn, reduced or released in accordance with documents
evidencing or securing
the applicable Mortgage Loan, the Pooling and Servicing
Agreement and the
Primary Servicing Agreement (it being understood that Seller has
agreed (a) that
the proceeds of such letter of credit belong to the Trust, (b)
to notify, on or
before the Closing Date, the bank issuing the letter of credit
that the letter
of credit and the proceeds thereof belong to the Trust, and to
use reasonable
efforts to obtain within 30 days (but in any event to obtain
within 90 days)
following the Closing Date, an acknowledgement thereof by the
bank (with a copy
of such acknowledgement to be sent to the Trustee) or a reissued
letter of
credit and (c) to indemnify the Trust for any liabilities,
charges, costs, fees
or other expenses accruing from the failure of Seller to assign
all rights to
the letter of credit hereunder including the right and power to
draw on the
letter of credit). In the case of clause (B) above, any letter
of credit held by
the Primary Servicer (or Master Servicer) shall be held in its
capacity as agent
of the Trust, and if the Primary Servicer (or Master Servicer)
sells its rights
to service the applicable Mortgage Loan, the Primary Servicer
(or Master
Servicer) has agreed to assign the applicable letter of credit
to the Trust or
at the direction of the Special Servicer to such party as the
Special Servicer
may instruct, in each case, at the expense of the Primary
Servicer (or Master
Servicer). The Primary Servicer (or Master Servicer) has agreed
to indemnify the
Trust for any loss caused by the ineffectiveness of such
assignment;
2.2.13 The original or a copy of the environmental indemnity
agreement, if
any, related to any Mortgage Loan;
2.2.14 Third-party management agreements for all hotels and for
such other
Mortgaged Properties securing Mortgage Loans with a Cut-Off Date
principal
balance equal to or greater than $20,000,000;
2.2.15 Any Environmental Insurance Policy; and
2.2.16 Any affidavit and indemnification agreement.
The original of each letter of credit referred to in clause
2.2.12 above shall
be delivered to the Primary Servicer, the Master Servicer or the
Trustee (as the
case may be) within 45 days of the Closing Date. In addition, a
copy of any
ground lease shall be delivered to the Primary Servicer within
30 days of the
Closing Date. Any failure to deliver any ground lease shall
constitute a
document defect.
"Officer's Certificate" shall mean a certificate signed by one
or more
of the Chairman of the Board, any Vice Chairman, the President,
any
Senior Vice President, any Vice President, any Assistant
Vice
President, any Treasurer or any Assistant Treasurer.
2.3 The Assignments of Mortgage and assignment of Assignment of
Leases referred
to in Sections 2.2.4 and 2.2.6 hereof may be in the form of a
single instrument
assigning the Mortgage and the Assignment of Leases to the
extent permitted by
applicable law. To avoid the unnecessary expense and
administrative
inconvenience associated with the execution and recording or
filing of multiple
assignments of mortgages, assignments of leases (to the extent
separate from the
mortgages) and assignments of UCC financing statements, Seller
shall execute, in
accordance with Section 2.6 hereof, the assignments of
mortgages, the
assignments of leases
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(to the extent separate from the mortgages) and the assignments
of UCC financing
statements relating to the Mortgage Loans naming the Trustee on
behalf of the
Certificateholders as assignee. Notwithstanding the fact that
such assignments
of mortgages, assignments of leases (to the extent separate from
the assignments
of mortgages) and assignments of UCC financing statements shall
name the Trustee
on behalf of the Certificateholders as the assignee, the parties
hereto
acknowledge and agree that the Mortgage Loans shall for all
purposes be deemed
to have been transferred from Seller to Purchaser and from
Purchaser to the
Trustee on behalf of the Certificateholders.
2.4 If Seller cannot deliver, or cause to be delivered, as to
any Mortgage Loan,
any of the documents and/or instruments referred to in Sections
2.2.2, 2.2.3,
2.2.5 or 2.2.6 hereof, with evidence of recording thereon,
solely because of a
delay caused by the public recording office where such document
or instrument
has been delivered for recordation within such 45 day period,
but Seller
delivers a photocopy thereof (certified by the appropriate
county recorder's
office to be a true and complete copy of the original thereof
submitted for
recording), to the Trustee within such 45 day period, Seller
shall then deliver
within 90 days after the Closing Date the recorded document (or
within such
longer period after the Closing Date as the Trustee may consent
to, which
consent shall not be unreasonably withheld so long as Seller is,
as certified in
writing to the Trustee no less often than monthly, in good faith
attempting to
obtain from the appropriate county recorder's office such
original or
photocopy).
2.5 The Trustee, as assignee or transferee of Purchaser, shall
be entitled to
all scheduled payments of principal due on the Mortgage Loans
after the Cut-Off
Date, all other payments of principal collected after the
Cut-Off Date (other
than scheduled payments of principal due on or before the
Cut-Off Date), and all
payments of interest on the Mortgage Loans allocable to the
period commencing on
the Cut-Off Date. All scheduled payments of principal and
interest due on or
before the Cut-Off Date and collected after the Cut-Off Date
shall belong to
Seller.
2.6 Within 45 days following the Closing Date, Seller shall
deliver and
Purchaser, the Trustee or the agents of either may submit or
cause to be
submitted for recordation at the expense of Seller, in the
appropriate public
office for real property records, each assignment referred to in
clauses 2.2.4
and 2.2.6(ii) above. Within 90 days following the Closing Date,
Seller shall
deliver and Purchaser, the Trustee or the agents of either may
submit or cause
to be submitted for filing, at the expense of Seller, in the
appropriate public
office for Uniform Commercial Code financing statements, the
assignment referred
to in clause 2.2.1. If any such document or instrument is lost
or returned
unrecorded or unfiled, as the case may be, because of a defect
therein, Seller
shall prepare a substitute therefor or cure such defect, and
Seller shall, at
its own expense (except in the case of a document or instrument
that is lost by
the Trustee), record or file, as the case may be, and deliver
such document or
instrument in accordance with this Section 2.
2.7 Documents that are in the possession of Seller, its agents
or its
subcontractors that relate to the Mortgage Loans and that are
not required to be
delivered to the Trustee shall be shipped by Seller to or at the
direction of
the Master Servicer, on behalf of Purchaser, on or prior to the
75th day after
the Closing Date, in accordance with Section 3.1 of the Primary
Servicing
Agreement, if applicable.
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2.8 The documents required to be delivered to the Master
Servicer (or in the
alternative, the Primary Servicer) shall include, to the extent
required to be
(and actually) delivered to Seller pursuant to the applicable
Mortgage Loan
documents, copies of the following items: the Mortgage Note, any
Mortgage, the
Assignment of Leases and the Assignment of Mortgage, any
guaranty/indemnity
agreement, any loan agreement, the insurance policies or
certificates, as
applicable, the property inspection reports, any financial
statements on the
property, any escrow analysis, the tax bills, the Appraisal, the
environmental
report, the engineering report, the asset summary, financial
information on the
Borrower/sponsor and any guarantors, any letters of credit, any
intercreditor
agreement and any Environmental Insurance Policies. Delivery of
any of the
foregoing documents to the Primary Servicer shall be deemed a
delivery to the
Master Servicer and satisfy Seller's obligations under this
subparagraph.
2.9 Upon the sale of the Mortgage Loans by Seller to Purchaser
pursuant to this
Agreement, the ownership of each Mortgage Note, Mortgage and the
other contents
of the related Mortgage File shall be vested in Purchaser and
its assigns, and
the ownership of all records and documents with respect to the
related Mortgage
Loan prepared by or that come into the possession of Seller
shall immediately
vest in Purchaser and its assigns, and shall be delivered
promptly by Seller to
or on behalf of either the Trustee or the Master Servicer as set
forth herein,
subject to the requirements of the Primary Servicing Agreement.
Seller's and
Purchaser's records shall reflect the transfer of each Mortgage
Loan from Seller
to Purchaser and its assigns as a sale.
2.10 It is the express intent of the parties hereto that the
conveyance of the
Mortgage Loans and related property to Purchaser by Seller as
provided in this
Section 2 be, and be construed as, an absolute sale of the
Mortgage Loans and
related property. It is, further, not the intention of the
parties that such
conveyance be deemed a pledge of the Mortgage Loans and related
property by
Seller to Purchaser to secure a debt or other obligation of
Seller. However, in
the event that, notwithstanding the intent of the parties, the
Mortgage Loans or
any related property are held to be the property of Seller, or
if for any other
reason this Agreement is held or deemed to create a security
interest in the
Mortgage Loans or any related property, then:
2.10.1 this Agreement shall be deemed to be a security
agreement; and
2.10.2 the conveyance provided for in this Section 2 shall be
deemed to be
a grant by Seller to Purchaser of a security interest in all of
Seller's right,
title, and interest, whether now owned or hereafter acquired, in
and to:
A. All accounts, general intangibles, chattel paper,
instruments,
documents, money, deposit accounts, certificates of deposit,
goods,
letters of credit, advices of credit and investment property
consisting
of, arising from or relating to any of the following property:
the
Mortgage Loans identified on the Mortgage Loan Schedule,
including the
related Mortgage Notes, Mortgages, security agreements, and
title, hazard
and other insurance policies, all distributions with respect
thereto
payable after the Cut-Off Date, all substitute or replacement
Mortgage
Loans and all distributions with respect thereto, and the
Mortgage Files;
B. All accounts, general intangibles, chattel paper,
instruments,
documents, money, deposit accounts, certificates of deposit,
goods,
letters of credit, advices of credit,
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investment property and other rights arising from or by virtue
of the
disposition of, or collections with respect to, or insurance
proceeds
payable with respect to, or claims against other Persons with
respect to,
all or any part of the collateral described in clause (A) above
(including
any accrued discount realized on liquidation of any investment
purchased
at a discount); and
C. All cash and non-cash proceeds of the collateral described
in
clauses (A) and (B) above.
2.11 The possession by Purchaser or its designee of the Mortgage
Notes, the
Mortgages, and such other goods, letters of credit, advices of
credit,
instruments, money, documents, chattel paper or certificated
securities shall be
deemed to be possession by the secured party or possession by a
purchaser for
purposes of perfecting the security interest pursuant to the
Uniform Commercial
Code (including, without limitation, Section 9-313 thereof) as
in force in the
relevant jurisdiction. Notwithstanding the foregoing, Seller
makes no
representation or warranty as to the perfection of any such
security interest.
2.12 Notifications to Persons holding such property, and
acknowledgments,
receipts, or confirmations from persons holding such property,
shall be deemed
to be notifications to, or acknowledgments, receipts or
confirmations from,
securities intermediaries, bailees or agents of, or Persons
holding for,
Purchaser or its designee, as applicable, for the purpose of
perfecting such
security interest under applicable law.
2.13 Seller shall, to the extent consistent with this Agreement,
take such
reasonable actions as may be necessary to ensure that, if this
Agreement were
deemed to create a security interest in the property described
above, 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. In such case, Seller shall file all filings
necessary to
maintain the effectiveness of any original filings necessary
under the Uniform
Commercial Code as in effect in any jurisdiction to perfect such
security
interest in such property. In connection herewith, Purchaser
shall have all of
the rights and remedies of a secured party and creditor under
the Uniform
Commercial Code as in force in the relevant jurisdiction.
2.14 Notwithstanding anything to the contrary contained herein,
and subject to
Section 2.1 hereof, Purchaser shall not be required to purchase
any Mortgage
Loan as to which any Mortgage Note (endorsed as described in
clause 2.2.1
hereof) required to be delivered to or on behalf of the Trustee
or the Master
Servicer pursuant to this Section 2 on or before the Closing
Date is not so
delivered, or is not properly executed or is defective on its
face, and
Purchaser's acceptance of the related Mortgage Loan on the
Closing Date shall in
no way constitute a waiver of such omission or defect or of
Purchaser's or its
successors' and assigns' rights in respect thereof pursuant to
Section 5 hereof.
3. EXAMINATION OF MORTGAGE FILES AND DUE DILIGENCE REVIEW.
3.1 Seller shall (i) deliver to Purchaser on or before the
Closing Date a
diskette acceptable to Purchaser that contains such information
about the
Mortgage Loans as may be reasonably
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requested by Purchaser, (ii) deliver to Purchaser investor files
(collectively
the "Collateral Information") with respect to the assets
proposed to be included
in the Mortgage Pool and made available at Purchaser's
headquarters in New York,
and (iii) otherwise cooperate fully with Purchaser in its
examination of the
credit files, underwriting documentation and Mortgage Files for
the Mortgage
Loans and its due diligence review of the Mortgage Loans. The
fact that
Purchaser has conducted or has failed to conduct any partial or
complete
examination of the credit files, underwriting documentation or
Mortgage Files
for the Mortgage Loans shall not affect the right of Purchaser
or the Trustee to
cause Seller to cure any Material Document Defect or Material
Breach (each as
defined below), or to repurchase or replace the defective
Mortgage Loans
pursuant to Section 5 hereof.
3.2 On or prior to the Closing Date, Seller shall allow
representatives of any
of Purchaser, each Underwriter, each Initial Purchaser, the
Trustee, the Special
Servicer and each Rating Agency to examine and audit all books,
records and
files pertaining to the Mortgage Loans, Seller's underwriting
procedures and
Seller's ability to perform or observe all of the terms,
covenants and
conditions of this Agreement. Such examinations and audits shall
take place at
one or more offices of Seller during normal business hours and
shall not be
conducted in a manner that is disruptive to Seller's normal
business operations
upon reasonable prior advance notice. In the course of such
examinations and
audits, Seller will make available to such representatives of
any of Purchaser,
each Underwriter, each Initial Purchaser, the Trustee, the
Special Servicer and
each Rating Agency reasonably adequate facilities, as well as
the assistance of
a sufficient number of knowledgeable and responsible individuals
who are
familiar with the Mortgage Loans and the terms of this
Agreement, and Seller
shall cooperate fully with any such examination and audit in all
material
respects. On or prior to the Closing Date, Seller shall provide
Purchaser with
all material information regarding Seller's financial condition
and access to
knowledgeable financial or accounting officers for the purpose
of answering
questions with respect to Seller's financial condition,
financial statements as
provided to Purchaser or other developments affecting Seller's
ability to
consummate the transactions contemplated hereby or otherwise
affecting Seller in
any material respect. Within 45 days after the Closing Date,
Seller shall
provide the Master Servicer or Primary Servicer, if applicable,
with any
additional information identified by the Master Servicer or
Primary Servicer, if
applicable, as necessary to complete the CMSA Property File, to
the extent that
such information is available.
3.3 Purchaser may exercise any of its rights hereunder through
one or more
designees or agents, provided Purchaser has provided Seller with
prior notice of
the identity of such designee or agent.
3.4 Purchaser shall keep confidential any information regarding
Seller and the
Mortgage Loans that has been delivered into Purchaser's
possession and that is
not otherwise publicly available; provided, however, that such
information shall
not be kept confidential (and the right to require
confidentiality under any
confidentiality agreement is hereby waived) to the extent such
information is
required to be included in the Free Writing Prospectus, the
Memorandum or the
Prospectus Supplement or Purchaser is required by law or court
order to disclose
such information. If Purchaser is required to disclose in the
Free Writing
Prospectus, the Memorandum or the Prospectus Supplement
confidential information
regarding Seller as described in the preceding sentence,
Purchaser shall provide
to Seller a copy of the proposed form of such disclosure prior
to making such
disclosure and Seller shall promptly, and in any
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event within two Business Days, notify Purchaser of any
inaccuracies therein, in
which case Purchaser shall modify such form in a manner that
corrects such
inaccuracies. If Purchaser is required by law or court order to
disclose
confidential information regarding Seller as described in the
second preceding
sentence, Purchaser shall notify Seller and cooperate in
Seller's efforts to
obtain a protective order or other reasonable assurance that
confidential
treatment will be accorded such information and, if in the
absence of a
protective order or such assurance, Purchaser is compelled as a
matter of law to
disclose such information, Purchaser shall, prior to making such
disclosure,
advise and consult with Seller and its counsel as to such
disclosure and the
nature and wording of such disclosure and Purchaser shall use
reasonable efforts
to obtain confidential treatment therefor. Notwithstanding the
foregoing, if
reasonably advised by counsel that Purchaser is required by a
regulatory agency
or court order to make such disclosure immediately, then
Purchaser shall be
permitted to make such disclosure without prior review by
Seller.
4. REPRESENTATIONS, WARRANTIES AND COVENANTS OF SELLER AND
PURCHASER.
4.1 To induce Purchaser to enter into this Agreement, Seller
hereby makes for
the benefit of Purchaser and its assigns with respect to each
Mortgage Loan as
of the date hereof (or as of such other date specifically set
forth in the
particular representation and warranty) each of the
representations and
warranties set forth on Exhibit 2 hereto, except as otherwise
set forth on
Schedule A attached hereto, and hereby further represents,
warrants and
covenants to Purchaser as of the date hereof that:
4.1.1 Seller is duly organized and is validly existing as a
corporation in
good standing under the laws of the State of New York. Seller
has the requisite
power and authority and legal right to own the Mortgage Loans
and to transfer
and convey the Mortgage Loans to Purchaser and has the requisite
power and
authority to execute and deliver, engage in the transactions
contemplated by,
and perform and observe the terms and conditions of, this
Agreement.
4.1.2 This Agreement has been duly and validly authorized,
executed and
delivered by Seller, and assuming the due authorization,
execution and delivery
hereof by Purchaser, this Agreement constitutes the valid, legal
and binding
agreement of Seller, enforceable in accordance with its terms,
except as such
enforcement may be limited by (A) laws relating to bankruptcy,
insolvency,
reorganization, receivership or moratorium, (B) other laws
relating to or
affecting the rights of creditors generally, (C) general equity
principles
(regardless of whether such enforcement is considered in a
proceeding in equity
or at law) or (D) 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 from
liabilities under applicable securities laws.
4.1.3 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 Seller with this Agreement, or the consummation by
Seller of any
transaction contemplated hereby, other than (A) such
qualifications as may be
required under state securities or blue sky laws, (B) the filing
or
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recording of financing statements, instruments of assignment and
other similar
documents necessary in connection with Seller's sale of the
Mortgage Loans to
Purchaser, (C) such consents, approvals, authorizations,
qualifications,
registrations, filings or notices as have been obtained and (D)
where the lack
of such consent, approval, authorization, qualification,
registration, filing or
notice would not have a material adverse effect on the
performance by Seller
under this Agreement.
4.1.4 Neither the transfer of the Mortgage Loans to Purchaser,
nor the
execution, delivery or performance of this Agreement by Seller,
conflicts or
will conflict with, results or will result in a breach of, or
constitutes or
will constitute a default under (A) any term or provision of
Seller's articles
of organization or by-laws, (B) any term or provision of any
material agreement,
contract, instrument or indenture to which Seller is a party or
by which it or
any of its assets is bound or results in the creation or
imposition of any lien,
charge or encumbrance upon any of its property pursuant to the
terms of any such
indenture, mortgage, contract or other instrument, other than
pursuant to this
Agreement, or (C) after giving effect to the consents or taking
of the actions
contemplated in Section 4.1.3 hereof, any law, rule, regulation,
order,
judgment, writ, injunction or decree of any court or
governmental authority
having jurisdiction over Seller or its assets, except where in
any of the
instances contemplated by clauses (B) or (C) above, any
conflict, breach or
default, or creation or imposition of any lien, charge or
encumbrance, will not
have a material adverse effect on the consummation of the
transactions
contemplated hereby by Seller or its ability to perform its
obligations and
duties hereunder or result in any material adverse change in the
business,
operations, financial condition, properties or assets of Seller,
or in any
material impairment of the right or ability of Seller to carry
on its business
substantially as now conducted.
4.1.5 There are no actions or proceedings against, or
investigations of,
Seller pending or, to Seller's knowledge, threatened in writing
against Seller
before any court, administrative agency or other tribunal, the
outcome of which
could reasonably be expected to materially and adversely affect
the transfer of
the Mortgage Loans to Purchaser or the execution or delivery by,
or
enforceability against, Seller of this Agreement or have an
effect on the
financial condition of Seller that would materially and
adversely affect the
ability of Seller to perform its obligations under this
Agreement.
4.1.6 On the Closing Date, the sale of the Mortgage Loans
pursuant to this
Agreement will effect a transfer by Seller of all of its right,
title and
interest in and to the Mortgage Loans to Purchaser.
4.1.7 To Seller's knowledge, Seller's Information (as defined in
that
certain indemnification agreement, dated April 5, 2007, between
Seller,
Purchaser, the Underwriters and the Initial Purchasers (the
"Indemnification
Agreement")) does not contain any untrue statement of a material
fact or omit to
state a material fact necessary to make the statements therein,
in the light of
the circumstances under which they were made, not misleading.
Notwithstanding
anything contained herein to the contrary, this subparagraph
4.1.7 shall run
exclusively to the benefit of Purchaser and no other party.
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4.1.8 The Seller has complied with the disclosure requirements
of
Regulation AB that arise from its role as "originator" and
"sponsor" in
connection with the issuance of the Public Certificates.
4.1.9 For so long as the Trust is subject to the reporting
requirements of
the Exchange Act, the Seller shall provide the Purchaser (or
with respect to any
Serviced Companion Mortgage Loan that is deposited into an Other
Securitization,
the depositor in such Other Securitization) and the Paying Agent
with any
Additional Form 10-D Disclosure and any Additional Form 10-K
Disclosure set
forth next to the Seller's name on Schedule XV and Schedule XVI
of the Pooling
and Servicing Agreement within the time periods and in
accordance with the
provisions set forth in the Pooling and Servicing Agreement.
To induce Purchaser to enter into this Agreement, Seller hereby
covenants that
the foregoing representations and warranties and those set forth
on Exhibit 2
hereto, subject to the exceptions set forth in Schedule A to
Exhibit 2, will be
true and correct in all material respects on and as of the
Closing Date with the
same effect as if made on the Closing Date.
Each of the representations, warranties and covenants made by
Seller pursuant to
this Section 4.1 shall survive the sale of the Mortgage Loans
and shall continue
in full force and effect notwithstanding any restrictive or
qualified
endorsement on the Mortgage Notes.
4.2 To induce Seller to enter into this Agreement, Purchaser
hereby represents
and warrants to Seller as of the date hereof:
4.2.1 Purchaser is a corporation duly organized, validly
existing, and in
good standing under the laws of the State of Delaware with full
power and
authority to carry on its business as presently conducted by
it.
4.2.2 Purchaser has full power and authority to acquire the
Mortgage
Loans, to execute and deliver this Agreement and to enter into
and consummate
all transactions contemplated by this Agreement. Purchaser has
duly and validly
authorized the execution, delivery and performance of this
Agreement and has
duly and validly executed and delivered this Agreement. This
Agreement, assuming
due authorization, execution and delivery by Seller, constitutes
the valid and
binding obligation of Purchaser, enforceable against it in
accordance with its
terms, except as such enforceability may be limited by
bankruptcy, insolvency,
reorganization, moratorium and other similar laws affecting the
enforcement of
creditors' rights generally and by general principles of equity,
regardless of
whether such enforcement is considered in a proceeding in equity
or at law.
4.2.3 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 Purchaser with this Agreement, or the consummation
by Purchaser of
any transaction contemplated hereby that has not been obtained
or made by
Purchaser.
4.2.4 Neither the purchase of the Mortgage Loans nor the
execution,
delivery and performance of this Agreement by Purchaser will
violate Purchaser's
certificate of incorporation
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<PAGE>
or by-laws or constitute a default (or an event that, with
notice or lapse of
time or both, would constitute a default) under, or result in a
breach of, any
material agreement, contract, instrument or indenture to which
Purchaser is a
party or that may be applicable to Purchaser or its assets.
4.2.5 Purchaser's 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, rule, writ, injunction, order or decree
of any court, or
order or regulation of any federal, state or municipal
government agency having
jurisdiction over Purchaser or its assets, which violation could
materially and
adversely affect the condition (financial or otherwise) or the
operation of
Purchaser or its assets or could materially and adversely affect
its ability to
perform its obligations and duties hereunder.
4.2.6 There are no actions or proceedings against, or
investigations of,
Purchaser pending or, to Purchaser's knowledge, threatened
against Purchaser
before any court, administrative agency or other tribunal, the
outcome of which
could reasonably be expected to adversely affect the transfer of
the Mortgage
Loans, the issuance of the Certificates, the execution, delivery
or
enforceability of this Agreement or have an effect on the
financial condition of
Purchaser that would materially and adversely affect the ability
of Purchaser to
perform its obligation under this Agreement.
4.2.7 Purchaser has not dealt with any broker, investment
banker, agent or
other person, other than 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 consummation
of any of the transactions contemplated hereby.
To induce Seller to enter into this Agreement, Purchaser hereby
covenants that
the foregoing representations and warranties will be true and
correct in all
material respects on and as of the Closing Date with the same
effect as if made
on the Closing Date.
Each of the representations and warranties made by Purchaser
pursuant to this
Section 4.2 shall survive the purchase of the Mortgage
Loans.
5. REMEDIES UPON BREACH OF REPRESENTATIONS AND WARRANTIES MADE
BY SELLER.
5.1 It is hereby acknowledged that Seller shall make for the
benefit of the
Trustee on behalf of the holders of the Certificates, whether
directly or by way
of Purchaser's assignment of its rights hereunder to the
Trustee, the
representations and warranties set forth on Exhibit 2 hereto
(each as of the
date hereof unless otherwise specified).
5.2 It is hereby further acknowledged that if any document
required to be
delivered to the Trustee pursuant to Section 2 hereof is not
delivered as and
when required, not properly executed or is defective on its
face, or if there is
a breach of any of the representations and warranties required
to be made by
Seller regarding the characteristics of the Mortgage Loans
and/or the related
Mortgaged Properties as set forth in Exhibit 2 hereto, and in
either case the
party discovering such breach or defect determines that either
(i) the defect or
breach materially and adversely affects the interests of the
holders of the
Certificates in the related Mortgage Loan or
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<PAGE>
(ii) both (A) the defect or breach materially and adversely
affects the value of
the Mortgage Loan and (B) the Mortgage Loan is a Specially
Serviced Mortgage
Loan or Rehabilitated Mortgage Loan (any such defect described
in the preceding
clause (i) or (ii), a "Material Document Defect" and any such
breach described
in the preceding clause (i) or (ii), a "Material Breach"), the
party determining
that such Material Document Defect or Material Breach exists
shall promptly
notify, in writing, the other parties; provided that any breach
of the
representation and warranty contained in paragraph (41) of such
Exhibit 2 shall
constitute a Material Breach only if such prepayment premium or
yield
maintenance charge is not deemed "customary" for commercial
mortgage loans as
evidenced by (i) an opinion of tax counsel to such effect or
(ii) a
determination by the Internal Revenue Service that such
provision is not
customary. Promptly (but in any event within three Business
Days) upon
determining (or becoming aware of another party's determination)
that any such
Material Document Defect or Material Breach exists (which
determination shall,
absent evidence to the contrary, be presumed to be no earlier
than three
Business Days prior to delivery of the notice to Seller referred
to below), the
Master Servicer shall, and the Special Servicer may, request
that Seller, not
later than 90 days from Seller's receipt of the notice of such
Material Document
Defect or Material Breach, cure such Material Document Defect or
Material
Breach, as the case may be, in all material respects; provided,
however, that if
such Material Document Defect or Material Breach, as the case
may be, cannot be
corrected or cured in all material respects within such 90 day
period, and such
Material Document Defect or Material Breach would not cause the
Mortgage Loan to
be other than a "qualified mortgage" (as defined in the Code)
but Seller is
diligently attempting to effect such correction or cure, as
certified by Seller
in an Officer's Certificate delivered to the Trustee, then the
cure period will
be extended for an additional 90 days unless, solely in the case
of a Material
Document Defect, (x) the Mortgage Loan is then a Specially
Serviced Mortgage
Loan and a Servicing Transfer Event has occurred as a result of
a monetary
default or as described in clause (ii) or clause (v) of the
definition of
"Servicing Transfer Event" in the Pooling and Servicing
Agreement and (y) the
Material Document Defect was identified in a certification
delivered to Seller
by the Trustee pursuant to Section 2.2 of the Pooling and
Servicing Agreement
not less than 90 days prior to the delivery of the notice of
such Material
Document Defect. The parties acknowledge that neither delivery
of a
certification or schedule of exceptions to Seller pursuant to
Section 2.2 of the
Pooling and Servicing Agreement or otherwise nor possession of
such
certification or schedule by Seller shall, in and of itself,
constitute delivery
of notice of any Material Document Defect or knowledge or
awareness by Seller,
the Master Servicer or the Special Servicer of any Material
Document Defect
listed therein.
5.3 Seller hereby covenants and agrees that, if any such
Material Document
Defect or Material Breach cannot be corrected or cured or Seller
otherwise fails
to correct or cure within the above cure periods, Seller shall,
on or before the
termination of such cure periods, either (i) repurchase the
affected Mortgage
Loan or REO Mortgage Loan (or interest therein) from Purchaser
or its assignee
at the Purchase Price as defined in the Pooling and Servicing
Agreement, 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,
without recourse, any Mortgage Loan or REO Mortgage Loan to
which such defect
relates with a Qualifying Substitute Mortgage Loan. If such
Material Document
Defect or Material Breach would cause the Mortgage Loan to
be
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<PAGE>
other than a "qualified mortgage" (as defined in the Code), then
notwithstanding
the previous sentence or the previous paragraph, repurchase must
occur within 85
days from the date Seller was notified of the defect. Seller
agrees that any
substitution shall be completed in accordance with the terms and
conditions of
the Pooling and Servicing Agreement.
5.4 If (x) a Mortgage Loan is to be repurchased or replaced as
contemplated
above (a "Defective Mortgage Loan"), (y) such Defective Mortgage
Loan is
cross-collateralized and cross-defaulted with one or more other
Mortgage Loans
("Crossed Mortgage Loans") and (z) the applicable document
defect or breach does
not constitute a Material Document Defect or Material Breach, as
the case may
be, as to such Crossed Mortgage Loans (without regard to this
paragraph), then
the applicable document defect or breach (as the case may be)
shall be deemed to
constitute a Material Document Defect or Material Breach, as the
case may be, as
to each such Crossed Mortgage Loan for purposes of the above
provisions, and
Seller shall be obligated to repurchase or replace each such
Crossed Mortgage
Loan in accordance with the provisions above, unless, in the
case of such breach
or document defect, (A) Seller provides a Nondisqualification
Opinion to the
Trustee at the expense of Seller if, in the reasonable business
judgment of the
Trustee, it would be usual and customary in accordance with
industry practice to
obtain a Nondisqualification Opinion and (B) both of the
following conditions
would be satisfied if Seller were to repurchase or replace only
those Mortgage
Loans as to which a Material Breach or Material Document Defect
had occurred
without regard to this paragraph (the "Affected Loan(s)"): (i)
the debt service
coverage ratio for all those Crossed Mortgage Loans (excluding
the Affected
Loan(s)) for the four calendar quarters immediately preceding
the repurchase or
replacement is not less than the lesser of (A) 0.10x below the
debt service
coverage ratio for all such Crossed Mortgage Loans (including
the Affected
Loans(s)) set forth in Appendix II to the Final Prospectus
Supplement and (B)
the debt service coverage ratio for all such Crossed Mortgage
Loans (including
the Affected Loan(s)) for the four preceding calendar quarters
preceding the
repurchase or replacement, and (ii) the loan-to-value ratio for
all such Crossed
Mortgage Loans (excluding the Affected Loan(s)) is not greater
than the greater
of (A) the loan-to-value ratio, expressed as a whole number
(taken to one
decimal place), for all such Crossed Mortgage Loans (including
the Affected
Loan(s)) set forth in Appendix II to the Final Prospectus
Supplement plus 10%
and (B) the loan-to-value ratio for all such Crossed Mortgage
Loans (including
the Affected Loans(s)), at the time of repurchase or
replacement. The
determination of the Master Servicer as to whether the
conditions set forth
above have been satisfied shall be conclusive and binding in the
absence of
manifest error. The Master Servicer will be entitled to cause to
be delivered,
or direct Seller to (in which case Seller shall) cause to be
delivered to the
Master Servicer, an Appraisal of any or all of the related
Mortgaged Properties
for purposes of determining whether the condition set forth in
clause (ii) above
has been satisfied, in each case at the expense of Seller if the
scope and cost
of the Appraisal is approved by Seller (such approval not to be
unreasonably
withheld).
5.5 With respect to any Defective Mortgage Loan, to the extent
that Seller is
required to repurchase or substitute for such Defective Mortgage
Loan (each, a
"Repurchased Loan") in the manner prescribed above while the
Trustee (as
assignee of Purchaser) continues to hold any Crossed Mortgage
Loan, Seller and
Purchaser hereby agree to forebear from enforcing any remedies
against the
other's Primary Collateral but may exercise remedies against the
Primary
Collateral securing their respective Mortgage Loans, including
with respect to
the Trustee, the Primary Collateral securing the Mortgage Loans
still held by
the Trustee, so long as such
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exercise does not impair the ability of the other party to
exercise its remedies
against its Primary Collateral. If the exercise of remedies by
one party would
impair the ability of the other party to exercise its remedies
with respect to
the Primary Collateral securing the Mortgage Loan or Mortgage
Loans held by such
party, then both parties shall forbear from exercising such
remedies until the
loan documents evidencing and securing the relevant Mortgage
Loans can be
modified in a manner that complies with the Pooling and
Servicing Agreement to
remove the threat of impairment as a result of the exercise of
remedies. Any
reserve or other cash collateral or letters of credit securing
the Crossed
Mortgage Loans shall be allocated between such Mortgage Loans in
accordance with
the Mortgage Loan documents, or otherwise on a pro rata basis
based upon their
outstanding Principal Balances. All other terms of the Mortgage
Loans shall
remain in full force and effect, without any modification
thereof. The
Mortgagors set forth on Schedule B hereto are intended
third-party beneficiaries
of the provisions set forth in this paragraph and the preceding
paragraph. The
provisions of this paragraph and the preceding paragraph may not
be modified
with respect to any Mortgage Loan without the related
Mortgagor's consent.
5.6 Any of the following document defects shall be conclusively
presumed
materially and adversely to affect the interests of
Certificateholders in a
Mortgage Loan and be a Material Document Defect: (a) the absence
from the
Mortgage File of the original signed Mortgage Note, unless the
Mortgage File
contains a signed lost note affidavit and indemnity that appears
to be regular
on its face; (b) the absence from the Mortgage File of the
original signed
Mortgage that appears to be regular on its face, unless there is
included in the
Mortgage File a certified copy of the Mortgage by the local
authority with which
the Mortgage was recorded; or (c) the absence from the Mortgage
File of the item
specified in paragraph 2.2.8. If any of the foregoing Material
Document Defects
is discovered by the Custodian (or the Trustee if there is no
Custodian), the
Trustee (or as set forth in Section 2.3(a) of the Pooling and
Servicing
Agreement, the Master Servicer) will take the steps described
elsewhere in this
Section, including the giving of notices to the Rating Agencies
and the parties
hereto and making demand upon Seller for the cure of the
Material Document
Defect or repurchase or replacement of the related Mortgage
Loan.
5.7 If Seller disputes that a Material Document Defect or
Material Breach exists
with respect to a Mortgage Loan or otherwise refuses (i) to
effect a correction
or cure of such Material Document Defect or Material Breach,
(ii) to repurchase
the affected Mortgage Loan from Purchaser or its assignee or
(iii) to replace
such Mortgage Loan with a Qualifying Substitute Mortgage Loan,
each in
accordance with this Agreement, then provided that (x) the
period of time
provided for Seller to correct, repurchase or cure has expired
and (y) the
Mortgage Loan is then in default and is then a Specially
Serviced Mortgage Loan,
the Special Servicer may, subject to the Servicing Standard,
modify, work-out or
foreclose, sell or otherwise liquidate (or permit the
liquidation of) the
Mortgage Loan pursuant to Sections 9.5, 9.12, 9.15 and 9.36, as
applicable, of
the Pooling and Servicing Agreement, while pursuing the
repurchase claim. Seller
acknowledges and agrees that any modification of the Mortgage
Loan pursuant to a
work-out shall not constitute a defense to any repurchase claim
nor shall such
modification and work-out change the Purchase Price due from
Seller for any
repurchase claim. In the event of any such modification and
work-out, Seller
shall be obligated to repurchase the Mortgage Loan as modified
and the Purchase
Price shall include any Work-Out Fee paid to the Special
Servicer up to the date
of repurchase plus the present value (calculated at a discount
rate equal to the
applicable Mortgage Rate) of the Work-Out Fee that would have
been payable to
the Special
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Servicer in respect of such Mortgage Loan if the Mortgage Loan
performed in
accordance with its terms to its Maturity Date, provided that no
amount shall be
paid by Seller in respect of any Work-Out Fee if a Liquidation
Fee already
co
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