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EXHIBIT 99.1
Wachovia Mortgage Loan Purchase Agreement
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MORTGAGE LOAN PURCHASE AGREEMENT
This Mortgage Loan Purchase Agreement, dated as of January 1,
2005
(the "Agreement"), is entered into between WACHOVIA BANK,
NATIONAL ASSOCIATION
(the "Seller") and Wachovia Commercial Mortgage Securities, Inc.
(the
"Purchaser").
The Seller intends to sell and the Purchaser intends to
purchase
certain multifamily and commercial mortgage loans (the "Mortgage
Loans")
identified on the schedule (the "Mortgage Loan Schedule")
annexed hereto as
Exhibit A. 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 (each, a "Class") 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 (the "Pooling and Servicing Agreement"),
dated as of January
1, 2005, among the Purchaser, as depositor, Wachovia Bank,
National Association,
as Master Servicer and a Special Servicer, GMAC Commercial
Mortgage Corporation,
as a Special Servicer and Wells Fargo Bank, N.A., as 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.
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 $1,653,388,056 (the "Wachovia
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
Wachovia
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 $2,063,442,241 (subject to a variance of plus or
minus 5.0%). The
purchase and sale of the Mortgage Loans shall take place January
27, 2005, or
such other date as shall be mutually acceptable to the parties
to this Agreement
(the "Closing Date"). The consideration (the "Aggregate Purchase
Price") for the
Mortgage Loans shall be equal to (i) % of the Wachovia Mortgage
Loan
Balance as of the Cut-Off Date, plus (ii) $6,256,271, which
amount represents
the amount of interest accrued on the Wachovia 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 Aggregate Purchase Price shall be paid to the Seller or
its
designee by wire transfer in immediately available funds on the
Closing Date.
SECTION 2. Conveyance of Mortgage Loans.
(a) Effective as of the Closing Date, subject only to receipt of
the
Aggregate Purchase Price and satisfaction of the other
conditions to closing
that are for the benefit of the Seller, 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.
(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 on or 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
shall be promptly remitted to, the Seller.
(c) No later than the Closing Date, the Seller shall, on behalf
of
the Purchaser, deliver to the Trustee, the documents and
instruments specified
below with respect to each Mortgage Loan (each a "Mortgage
File"). All Mortgage
Files so delivered will be held by the Trustee in escrow at all
times prior to
the Closing Date. Each Mortgage File shall contain the following
documents:
(i) the original executed Mortgage Note including any power
of
attorney related to the execution thereof, 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 Wachovia Bank Commercial Mortgage Trust,
Commercial
Mortgage Pass-Through Certificates, Series 2005-C16" or in blank
(or a
lost note affidavit and indemnity with a copy of such Mortgage
Note
attached thereto);
(ii) an original or copy of the Mortgage, together with 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 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
any missing recording information), of (a) the Mortgage, (b) any
related
Assignment of Leases (if such item is a document separate from
the
Mortgage and to the extent not already assigned pursuant to
preceding
clause (a)) and (c) any other recorded document relating to the
Mortgage
Loan otherwise included in the Mortgage File, in favor of "Wells
Fargo
Bank, N.A., as trustee for the registered holders of Wachovia
Bank
Commercial Mortgage Trust, Commercial Mortgage Pass-Through
Certificates,
Series 2005-C16", 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 Wachovia Bank Commercial Mortgage Trust,
Commercial
Mortgage Pass-Through Certificates, Series 2005-C16", or in
blank;
(vi) originals or copies of any modification, consolidation,
assumption and substitution agreements in those instances where
the terms
or provisions of the Mortgage or Mortgage Note have been
consolidated or
modified or the Mortgage Loan has been assumed or
consolidated;
(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 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 (bearing evidence of filing) or
other
evidence of filing satisfactory to the Purchaser of any prior
UCC
Financing Statements in favor of the originator of such 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 and
continuation statement in favor of the Seller on record with
the
applicable public office for UCC Financing Statements, an
original UCC
Amendment, in form suitable for filing in favor of Wells Fargo
Bank, N.A.,
as trustee for the registered holders of Wachovia Bank
Commercial Mortgage
Trust, Commercial Mortgage Pass-Through Certificates, Series
2005-C16, as
assignee", or in blank;
(ix) an original or copy of (a) any Ground Lease and (b) any
loan
guaranty, indemnity, ground lessor estoppel or environmental
insurance
policy;
(x) any intercreditor agreement relating to permitted debt
(including, without limitation, mezzanine debt) of the
Mortgagor;
(xi) copies of any loan agreement, escrow agreement or
security
agreement relating to such Mortgage Loan;
(xii) a copy of any letter of credit and related transfer
documents
relating to such Mortgage Loan; and
(xiii) with respect to any Companion Loan, all of the above
documents with respect to such Companion Loan and the
related
Intercreditor Agreement; provided that a copy of each Mortgage
Note
relating to such Companion Loan, rather than the original, shall
be
provided, and no assignments shall be provided.
(d) The Seller shall take all actions reasonably necessary (i)
to
permit the Trustee to fulfill its obligations pursuant to
Section 2.01(d) of the
Pooling and Servicing Agreement and (ii) to perform its
obligations described in
Section 2.01(d) of the Pooling and Servicing Agreement. Without
limiting the
generality of the foregoing, if a draw upon a letter of credit
is required
before its transfer to the Trust Fund can be completed, the
Seller shall draw
upon such letter of credit for the benefit of the Trust pursuant
to written
instructions from the Master Servicer. The Seller shall
reimburse the Trustee
for all reasonable costs and expenses, if any, incurred by the
Trustee for
recording any documents described in Section 2(c)(iv)(c) hereof
and filing any
assignments of UCC Financing Statements described in the proviso
in the third to
last sentence in Section 2.01(d) of the Pooling and Servicing
Agreement.
(e) All documents and records (except draft documents,
privileged
communications and internal correspondence and credit, due
diligence and other
underwriting analysis, documents, data or internal worksheets,
memoranda,
communications and evaluations of the Seller) relating to each
Mortgage Loan and
in the Seller's possession (the "Additional Mortgage Loan
Documents") that are
not required to be delivered to the Trustee shall promptly 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, together
with any
related escrow amounts and reserve amounts.
(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 the Closing Date, the Seller shall pay to the Master
Servicer
for deposit into the Interest Reserve Account an amount equal to
$239,436, which
represents the Initial Interest Reserve Account Deposit for its
Interest Reserve
Loans.
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:
(i) The Seller is a national banking association organized
and
validly existing and in good standing under the laws of the
United States
and possesses all requisite authority, power, licenses, permits
and
franchises to carry on its business as currently conducted by it
and to
execute, deliver and comply with its obligations under the terms
of this
Agreement;
(ii) This Agreement has been duly and validly authorized,
executed
and delivered by the Seller and, assuming due authorization,
execution and
delivery hereof by the Purchaser, constitutes a legal, valid and
binding
obligation of the Seller, enforceable against the Seller in
accordance
with its terms, except as such enforcement may be limited by
bankruptcy,
insolvency, reorganization, receivership, moratorium and other
laws
affecting the enforcement of creditors' rights in general as
they may be
applied in the context of the insolvency of a national
banking
association, and by general equity principles (regardless of
whether such
enforcement is considered in a proceeding in equity or at law),
and by
public policy considerations underlying the securities laws, to
the extent
that such public policy considerations limit the enforceability
of the
provisions of this Agreement which purport to provide
indemnification from
liabilities under applicable securities laws;
(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 articles of association or
bylaws, (B)
violate any law or regulation or any administrative decree or
order to
which it is subject or (C) constitute a material default (or an
event
which, with notice or lapse of time, or both, would constitute a
material
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;
(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 have
consequences
that would 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 articles of association, 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 contemplated
by this
Agreement except as have previously been obtained, and no bulk
sale law
applies to such transactions;
(vii) No litigation is pending or, to the Seller's
knowledge,
threatened against the Seller that would, in the Seller's good
faith and
reasonable judgment, prohibit its entering into this Agreement
or
materially and adversely affect the performance by the Seller of
its
obligations under this Agreement; and
(viii) 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 Aggregate Purchase Price. 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 for the benefit of the Purchaser and the
Trustee for the
benefit of the Certificateholders as of the Closing Date, with
respect to (and
solely with respect to) each Mortgage Loan, which
representations and warranties
are subject to the exceptions set forth on Schedule II.
(c) With respect to the schedule of exceptions delivered by
the
Trustee on the Closing Date, within fifteen (15) Business Days
(or, in the
reasonable discretion of the Controlling Class Representative,
thirty (30)
Business Days) of the Closing Date, with respect to the
documents specified in
clauses (i), (ii), (vii), (ix) (solely with respect to Ground
Leases) and (xii)
of the definition of Mortgage File, the Seller shall cure any
material exception
listed therein (for the avoidance of doubt, any deficiencies
with respect to the
documents specified in clause (ii) resulting solely from a delay
in the return
of the related documents from the applicable recording office,
shall be cured in
the time and manner described in Section 2.01(c) of the Pooling
and Servicing
Agreement). If such exception is not so cured, the Seller shall
either (1)
repurchase the related Mortgage Loan, (2) with respect to
exceptions relating to
clause (xii) of the definition of "Mortgage File", deposit with
the Trustee an
amount, to be held in trust in a Special Reserve Account
pursuant to the Pooling
and Servicing Agreement, equal to the amount of the undelivered
letter of credit
(in the alternative, the Seller may deliver to the Trustee, with
a certified
copy to the Master Servicer and Trustee, a letter of credit for
the benefit of
the Master Servicer on behalf of the Trustee and upon the same
terms and
conditions as the undelivered letter of credit) which the Master
Servicer on
behalf of the Trustee may use (or draw upon, as the case may be)
under the same
circumstances and conditions as the Master Servicer would have
been entitled to
draw on the undelivered letter of credit, or (3) with respect to
any exceptions
relating to clauses (i), (ii) and (vii), deposit with the
Trustee an amount, to
be held in trust in a Special Reserve Account pursuant to the
Pooling and
Servicing Agreement, equal to 25% of the Stated Principal
Balance of the related
Mortgage Loan on such date. Any funds or letter of credit
deposited pursuant to
clauses (2) and (3) shall be held by the Trustee until the
earlier of (x) the
date on which the Master Servicer certifies to the Trustee and
the Controlling
Class Representative that such exception has been cured (or the
Trustee
certifies the same to the Controlling Class Representative), at
which time such
funds or letter of credit, as applicable, shall be returned to
the Seller and
(y) thirty (30) Business Days or, if the Controlling Class
Representative has
extended the cure period, forty-five (45) Business Days after
the Closing Date;
provided, however, that if such exception is not cured within
such thirty (30)
Business Days or forty-five (45) Business Days, as the case may
be, (A) in the
case of clause (2), the Trustee shall retain the funds or letter
of credit, as
applicable, or (B) in the case of clause (3), the Seller shall
repurchase the
related Mortgage Loan in accordance with the terms and
conditions of this
Agreement, at which time such funds shall be applied to the
Purchase Price of
the related Mortgage Loan and any letter of credit will be
returned to the
Seller.
If the Seller receives written notice of a Document Defect or
a
Breach pursuant to Section 2.03(a) of the Pooling and Servicing
Agreement
relating to a Mortgage Loan, then the Seller shall not later
than 90 days from
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 the date
that any party to the Pooling and Servicing Agreement discovers
such Document
Defect or Breach provided the Seller receives such notice in a
timely manner),
if such Document Defect or Breach shall materially and adversely
affect the
value of the applicable Mortgage Loan, the interest of the Trust
therein or the
interests of any Certificateholder, cure such Document Defect or
Breach, as the
case may be, in all material respects, which shall include
payment` of actual or
provable losses and any Additional Trust Fund Expenses directly
resulting from
any such Document Defect or Breach or, if such Document Defect
or Breach (other
than omissions solely due 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 at the applicable Purchase Price not
later than the end
of such 90-day period or (ii) other than with respect to the
Edgewater Hotel
Loan (loan number 16), substitute a Qualified Substitute
Mortgage Loan for such
affected Mortgage 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 Certificate Account, any
Substitution Shortfall
Amount in connection therewith; provided, however, that unless
the Breach would
cause the Mortgage Loan not to be a Qualified Mortgage, and 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, such Seller
shall have an
additional 90 days to complete such cure (or, failing such cure,
to repurchase
or substitute the related Mortgage 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 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 Mortgage Note, Mortgage, title insurance
policy, Ground
Lease, any letter of credit, any franchise agreement, any
comfort letter and (if
required) any comfort letter transfer documents (collectively,
the "Core
Material Documents")) shall be considered to materially and
adversely affect the
value of the related Mortgage Loan, the interests of the Trust
therein or the
interests of any Certificateholder 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 or any
collateral
securing the Mortgage Loan or for any immediate significant
servicing
obligations; provided, further, with respect to Document Defects
which
materially and adversely affect the interests of any
Certificateholder, the
interests of the Trust therein or the value of the related
Mortgage Loan, other
than with respect to Document Defects relating to the Core
Material Documents,
any applicable cure period following the initial 90 day cure
period may be
extended by the Master Servicer or the Special Servicer if the
document involved
is not needed imminently. Such extension will end upon 30 days
notice of such
need as reasonably determined by the Master Servicer or Special
Servicer (with a
possible 30 day extension if the Master Servicer or Special
Servicer agrees that
the Seller is diligently pursuing a cure). The Seller shall cure
all Document
Defects which materially and adversely affect the interests of
any
Certificateholder, the interests of the Trust therein or the
value of the
related Mortgage Loan, regardless of the document involved, no
later than 2
years following the Closing Date; provided that the initial 90
day cure period
referenced in this paragraph may not be reduced. 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, the
Seller shall provide the officer's certificate to the Trustee
described above as
to the reasons such Document Defect or Breach remains uncured
and as to the
actions being taken to pursue cure. Notwithstanding the
foregoing, the delivery
of a commitment to issue a policy of lender's title insurance as
described in
clause 12 of Schedule I hereof 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.
If (i) any Mortgage Loan is required to be repurchased or
substituted for in the manner described above, (ii) such
Mortgage Loan is
cross-collateralized and cross-defaulted with one or more other
Mortgage Loans
(each, a "Crossed Loan"), and (iii) the applicable 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 Group (without regard to this
paragraph),
then the applicable Document Defect or Breach, as the case may
be, will be
deemed to constitute a Document Defect or Breach, as the case
may be, as to any
other Crossed Loan in the Crossed Group for purposes of this
paragraph, and the
Seller will be required to repurchase or substitute for all of
the remaining
Crossed Loan(s) in the related Crossed Group as provided in the
immediately
preceding paragraph unless such other Crossed Loans in such
Crossed Group
satisfy the Crossed Loan Repurchase Criteria and satisfy all
other criteria for
substitution or repurchase of Mortgage Loans set forth herein.
In the event that
the remaining 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 Breach or Document Defect exists or to
repurchase or
substitute for all of the Crossed Loans in the related Crossed
Group. The Seller
shall be responsible for the cost of any Appraisal required to
be obtained by
the Master Servicer to determine if the Crossed Loan Repurchase
Criteria have
been satisfied, so long as the scope and cost of such Appraisal
has been
approved by the Seller (such approval not to be unreasonably
withheld).
To the extent that the Seller is required to repurchase or
substitute for a Crossed Loan hereunder in the manner prescribed
above while the
Trustee continues to hold any other Crossed Loans in such
Crossed Group, neither
the Seller nor the Purchaser shall enforce any remedies against
the other's
Primary Collateral, but each is permitted to exercise remedies
against the
Primary Collateral securing its respective Crossed Loans,
including with respect
to the Trustee, the Primary Collateral securing Crossed Loans
still held by the
Trustee.
If the exercise of remedies 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 Loans 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 that complies with this Agreement to remove
the threat of
material impairment as a result of the exercise of remedies or
some other
accommodation can be reached. Any reserve or other cash
collateral or letters of
credit securing the Crossed Loans shall be allocated between
such Crossed Loans
in accordance with the Mortgage Loan documents, or otherwise on
a pro rata basis
based upon their outstanding Stated Principal Balances.
Notwithstanding the
foregoing, if a Crossed Loan included in the Trust Fund is
modified to terminate
the related cross-collateralization and/or cross-default
provisions, as a
condition to such modification, the Seller shall furnish to the
Trustee an
Opinion of Counsel that any modification shall not cause an
Adverse REMIC Event.
Any expenses incurred by the Purchaser in connection with such
modification or
accommodation (including but not limited to recoverable attorney
fees) shall be
paid by the Seller.
(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
Purchase Price or
Substitution Shortfall Amount(s), as applicable, in the
Certificate Account, and
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, if applicable (i) the Trustee shall execute and
deliver such
endorsements and assignments as are provided to it by the Master
Servicer, 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 Loans.
(e) Without limiting the remedies of the Purchaser, the
Certificateholders or the Trustee on behalf of the
Certificateholders pursuant
to this Agreement, it is acknowledged that the representations
and warranties
are being made for risk allocation purposes. This Section 3
provides the sole
remedy available to 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. Nothing in this
Agreement shall
prohibit the Purchaser or its assigns (including the Master
Servicer and/or the
Special Servicer) from pursuing any course of action authorized
by the Pooling
and Servicing Agreement while the Purchaser asserts a claim or
brings a cause of
action to enforce any rights set forth herein against the
Seller.
(f) With respect to any Mortgage Loan which has become a
Defaulted
Mortgage Loan under the Pooling and Servicing Agreement or with
respect to which
the related Mortgaged Property has been foreclosed and which is
the subject of a
repurchase claim under this Agreement, in accordance with
Section 2.03 of the
Pooling and Servicing Agreement, the Special Servicer with the
consent of the
Controlling Class Representative shall notify the Seller in
writing of its
intention to liquidate such Defaulted Mortgage Loan or REO
Property at least 45
days prior to any such action. If (a) the Seller consents to
such sale and
voluntarily agrees to repurchase such Defaulted Mortgage Loan or
REO Property or
(b) a court of competent jurisdiction determines that the Seller
is liable under
this Agreement to repurchase such Defaulted Mortgage Loan or REO
Property, then
such Seller shall remit to the Purchaser an amount equal to the
difference if
any of the price of such Defaulted Mortgage Loan or REO Property
as sold and the
price at which the Seller would have had to repurchase such
Defaulted Mortgage
Loan or REO Property under this Agreement. The Seller shall have
10 Business
Days after receipt of notice to determine whether or not to
consent to such
sale. If the Seller does not consent to such sale, the Special
Servicer shall
contract with a Determination Party (as defined in the Pooling
and Servicing
Agreement) as to the merits of such proposed sale. If the
related Determination
Party determines that such proposed sale is in accordance with
the Servicing
Standard and the provisions of the Pooling and Servicing
Agreement with respect
to the sale of Defaulted Mortgage Loans and REO Properties and,
subsequent to
such sale, a court of competent jurisdiction determines that
Seller was liable
under this Agreement and required to repurchase such Defaulted
Mortgage Loan or
REO Property in accordance with the terms hereof, then the
Seller shall remit to
Purchaser an amount equal to the difference (if any) between the
proceeds of the
related action and the price at which the Seller would have been
obligated to
pay had the Seller repurchased such Defaulted Mortgage Loan or
REO Property in
accordance with the terms hereof including the costs related to
contracting with
the related Determination Party provided that the foregoing
procedure in this
Section 3(f) shall not preclude the Seller from repurchasing the
Defaulted
Mortgage Loan or REO Property prior to the execution of a
binding contract of
sale with a third party in accordance with the other provisions
of this Section
3 (excluding this subsection (f)). If the related Determination
Party determines
that the sale of the related Defaulted Mortgage Loan or REO
Property is not in
accordance with the Servicing Standards and the provisions of
the Pooling and
Servicing Agreement with respect to the sale of Defaulted
Mortgage Loans and REO
Properties and the Special Servicer subsequently sells such
Mortgage Loan or REO
Property, then the Seller will not be liable for any such
difference (nor any
cost of contracting with the Determination Party).
(g) Notwithstanding the foregoing, if there exists a Breach
relating
to whether or not the Mortgage Loan documents or any particular
Mortgage Loan
document requires the related Mortgagor to bear the costs and
expenses
associated with any particular action or matter under such
Mortgage Loan
document(s) with respect to matters described in Representations
23 and 43 of
Schedule I, then the Purchaser shall direct the Seller in
writing to wire
transfer to the Master Servicer for deposit into the Certificate
Account, within
90 days of the Seller's receipt of such direction, the amount of
any such costs
and expenses borne by the Purchaser, the Certificateholders, the
Master
Servicer, the Special Servicer and the Trustee on their behalf
that are the
basis of such Breach. Upon its making such deposit, the Seller
shall be deemed
to have cured such Breach in all respects. Provided such payment
is made in
full, this paragraph describes the sole remedy available to the
Purchaser, the
Certificateholders, the Master Servicer, the Special Servicer
and the Trustee on
their behalf regarding any such Breach and the Seller shall not
be obligated to
repurchase the affected Mortgage Loan on account of such Breach
or otherwise
cure such Breach.
SECTION 4. Representations and Warranties of the Purchaser. In
order
to induce the Seller to enter into this Agreement, the Purchaser
hereby
represents and warrants 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 North
Carolina. The
Purchaser has the full corporate power and authority and legal
right to acquire
the Mortgage Loans from the Seller and to transfer the Mortgage
Loans to the
Trustee.
(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 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,
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) 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.
(d) None of the acquisition of the Mortgage Loans by the
Purchaser,
the transfer of the Mortgage Loans to the Trustee, and the
execution, delivery
or performance of this Agreement by the Purchaser, results or
will result in the
creation or imposition of any lien on any of the Purchaser's
assets or property,
or 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 the
Purchaser's articles of association or bylaws, (B) any term or
provision of any
material agreement, contract, instrument or indenture, to which
the Purchaser is
a party or by which the Purchaser is bound, or (C) any law,
rule, regulation,
order, judgment, writ, injunction or decree of any court or
governmental
authority having jurisdiction over the Purchaser or its
assets.
(e) 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
Price.
(f) 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.
(g) 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 governmental agency, which default might have
consequences that
would 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 Cadwalader,
Wickersham & Taft
LLP, Charlotte, North Carolina 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) The Pooling and Servicing Agreement (to the extent it
affects
the obligations of the Seller hereunder) and 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,
the Initial
Purchasers 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 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;
and
(f) A letter shall have been received from the independent
accounting firm of KPMG LLP in form satisfactory to the
Purchaser, relating to
certain information regarding the Mortgage Loans and
Certificates as set forth
in the Prospectus and Prospectus Supplement, respectively.
Both parties agree to use their best 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:
(a) This Agreement duly executed by the Purchaser and the
Seller;
(b) A 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 or any other
document or
certificate delivered on or before the Closing Date in
connection with the
transactions contemplated herein, 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 the Initial Purchasers may rely,
to the effect
that with respect to the Seller, the Mortgage Loans, the related
Mortgagors and
the related Mortgaged Properties (i) such officer has carefully
examined the
Specified Portions 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 examined the Specified Portions of the
Memorandum 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 thereto, the diskette which accompanies the
Prospectus Supplement
(insofar as such diskette is consistent with such Annex A) and
the following
sections of the Prospectus Supplement (exclusive of any
statements in such
sections that purport to summarize the servicing and
administration provisions
of the Pooling and Servicing Agreement): "Summary of Prospectus
Supplement--The
Parties--The Mortgage Loan Sellers," "Summary of Prospectus
Supplement--The
Mortgage Loans," "Risk Factors--The Mortgage Loans," and
"Description of the
Mortgage Pool--General," "--Mortgage Loan History," "--Certain
Terms and
Conditions of the Mortgage Loans," "--Assessments of Property
Condition,"
"--Co-Lender Loans," "--Additional Mortgage Loan Information,"
"--Twenty Largest
Mortgage Loans," "--The Mortgage Loan Sellers," "--Underwriting
Standards," and
"--Representations and Warranties; Repurchases and
Substitutions." The
"Specified Portions" of the Memorandum shall consist of the
Specified Portions
of the Prospectus Supplement and the first and second full
paragraphs on page
"iv" of the Memorandum.
(e) The resolutions of the requisite committee of the Seller's
board of
directors authorizing the Seller's entering into the
transactions contemplated
by this Agreement, the articles of association and by-laws of
the Seller, and an
original or copy of a certificate of good standing of the Seller
issued by the
Comptroller of the Currency not earlier than sixty (60) days
prior to the
Closing Date;
(f) A written opinion of counsel for the Seller (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 as may be required by the Rating Agencies;
and
(g) Such further certificates, opinions and documents as the
Purchaser may
reasonably request.
SECTION 7. Indemnification.
(a) The Seller shall indemnify and hold harmless the Purchaser,
the
Underwriters, the Initial Purchasers, their respective officers
and directors,
and each person, if any, who controls the Purchaser, any
Underwriter or any
Initial Purchaser within the meaning of either Section 15 of the
Securities Act
of 1933, as amended (the "1933 Act") or Section 20 of the
Securities Exchange
Act of 1934, as amended (the "1934 Act"), against any and all
losses, expenses
(including the reasonable fees and expenses of legal counsel),
claims, damages
or liabilities, joint or several, to which they or any of them
may become
subject under the 1933 Act, the 1934 Act or other federal or
state statutory law
or regulation, at common law or otherwise, insofar as such
losses, claims,
damages or liabilities (or actions in respect thereof) (i) arise
out of or are
based upon any untrue statement or alleged untrue statement of a
material fact
contained in (A) the Prospectus Supplement, the Preliminary
Prospectus
Supplement, the Memorandum, the Diskette or, insofar as they are
required to be
filed as part of the Registration Statement pursuant to the
No-Action Letters,
any Computational Materials or ABS Term Sheets with respect to
the Registered
Certificates, or in any revision or amendment of or supplement
to any of the
foregoing, (B) any items similar to Computational Materials or
ABS Term Sheets
forwarded by the Seller to the Initial Purchasers, or in any
revision or
amendment of or supplement to any of the foregoing or (C) the
summaries,
reports, documents and other written and computer materials and
all other
information regarding the Mortgage Loans or the Seller furnished
by the Seller
for review by prospective investors (the items in (A), (B) and
(C) above being
defined as the "Disclosure Material"), or (ii) arise out of or
are based upon
the omission or alleged omission to state therein (in the case
of Computational
Materials and ABS Term Sheets, when read in conjunction with the
Prospectus
Supplement, in the case of items similar to Computational
Materials and ABS Term
Sheets, when read in conjunction with the Memorandum, and in the
case of any
summaries, reports, documents, written or computer materials, or
other
information contemplated in clause (C) above, when read in
conjunction with the
Memorandum) a material fact required to be stated therein or
necessary to make
the statements therein, in the light of the circumstances under
which they were
made, not misleading; but, with respect to the Disclosure
Material described in
clauses (A) and (B) of the definition thereof, only if and to
the extent that
(I) any such untrue statement or alleged untrue statement or
omission or alleged
omission occurring in, or with respect to, such Disclosure
Material, arises out
of or is based upon an untrue statement or omission with respect
to the Mortgage
Loans, the related Mortgagors and/or the related Mortgaged
Properties contained
in the Data File (it being herein acknowledged that the Data
File was and will
be used to prepare the Prospectus Supplement and the Preliminary
Prospectus
Supplement, including without limitation Annex A thereto, the
Memorandum, the
Diskette, any Computational Materials and ABS Term Sheets with
respect to the
Registered Certificates and any items similar to Computational
Materials and ABS
Term Sheets forwarded to prospective investors in the
Non-Registered
Certificates), (II) any such untrue statement or alleged untrue
statement or
omission or alleged omission of a material fact occurring in, or
with respect
to, such Disclosure Material, is with respect to, or arises out
of or is based
upon an untrue statement or omission of a material fact with
respect to, the
information regarding the Mortgage Loans, the related
Mortgagors, the related
Mortgaged Properties and/or the Seller set forth in the
Specified Portions of
each of the Prospectus Supplement, the Preliminary Prospectus
Supplement and the
Memorandum, (III) any such untrue statement or alleged untrue
statement or
omission or alleged omission occurring in, or with respect to,
such Disclosure
Material, arises out of or is based upon a breach of the
representations and
warranties of the Seller set forth in or made pursuant to
Section 3 or (IV) any
such untrue statement or alleged untrue statement or omission or
alleged
omission occurring in, or with respect to, such Disclosure
Material, arises out
of or is based upon any other written information concerning the
characteristics
of the Mortgage Loans, the related Mortgagors or the related
Mortgaged
Properties furnished to the Purchaser, the Underwriters or the
Initial
Purchasers by the Seller; provided that the indemnification
provided by this
Section 7 shall not apply to the extent that such untrue
statement or omission
of a material fact was made as a result of an error in the
manipulation of, or
in any calculations based upon, or in any aggregation of the
information
regarding the Mortgage Loans, the related Mortgagors and/or the
related
Mortgaged Properties set forth in the Data File or Annex A to
the Prospectus
Supplement or the Preliminary Prospectus Supplement to the
extent such
information was not materially incorrect in the Data File or
such Annex A, as
applicable, including without limitation the aggregation of such
information
with comparable information relating to the Other Mortgage
Loans.
Notwithstanding the foregoing, the indemnification provided in
this Section 7(a)
shall not inure to the benefit of any Underwriter or Initial
Purchaser (or to
the benefit of any person controlling such Underwriter or
Initial Purchaser)
from whom the person asserting claims giving rise to any such
losses, claims,
damages, expenses or liabilities purchased Certificates if (x)
the subject
untrue statement or omission or alleged untrue statement or
omission made in any
Disclosure Material (exclusive of the Prospectus or any
corrected or amended
Prospectus or the Memorandum or any corrected or amended
Memorandum) is
eliminated or remedied in the Prospectus or the Memorandum (in
either case, as
corrected or amended, if applicable), as applicable, and (y) a
copy of the
Prospectus or Memorandum (in either case, as corrected or
amended, if
applicable), as applicable, shall not have been sent to such
person at or prior
to the written confirmation of the sale of such Certificates to
such person, and
(z) such Underwriter or Initial Purchaser received
electronically or in writing
notice of such untrue statement or omission and updated
information concerning
the untrue statement or omission at least one Business Day prior
to the written
confirmation of such sale. The Seller shall, subject to clause
(c) below,
reimburse each such indemnified party, as incurred, for any
legal or other
expenses reasonably incurred by them in connection with
investigating or
defending any such loss, claim, damage, liability or action.
This indemnity will
be in addition to any liability which the Seller may otherwise
have.
(b) For purposes of this Agreement, "Registration Statement"
shall mean
such registration statement No. 333-120922 filed by the
Purchaser on Form S-3,
including without limitation exhibits thereto and information
incorporated
therein by reference; "Base Prospectus" shall mean the
prospectus dated January
19, 2005, as supplemented by the prospectus supplement dated
January 19, 2005
(the "Prospectus Supplement" and, together with the Base
Prospectus, the
"Prospectus") relating to the Registered Certificates, including
all annexes
thereto; "Preliminary Prospectus Supplement" shall mean the
prospectus
supplement dated January 1, 2005, relating to the Registered
Certificates,
including all annexes thereto; "Memorandum" shall mean the
private placement
memorandum dated January 19, 2005, relating to the
Non-Registered Certificates,
including all exhibits thereto; "Registered Certificates" shall
mean the Class
A-1, Class A-2, Class A-3, Class A-PB, Class A-4, Class A-J,
Class B, Class C
and Class D Certificates; "Non-Registered Certificates" shall
mean the
Certificates other than the Registered Certificates;
"Computational Materials"
shall have the meaning assigned thereto in the no-action letter
dated May 20,
1994 issued by the Division of Corporation Finance of the
Securities and
Exchange Commission (the "Commission") to Kidder, Peabody
Acceptance Corporation
I, Kidder, Peabody & Co. Incorporated, and Kidder Structured
Asset Corporation
and the no-action letter dated May 27, 1994 issued by the
Division of
Corporation Finance of the Commission to the Public Securities
Association
(together, the "Kidder Letters"); "ABS Term Sheets" shall have
the meaning
assigned thereto in the no-action letter dated February 17, 1995
issued by the
Division of Corporation Finance of the Commission to the Public
Securities
Association (the "PSA Letter" and, together with the Kidder
Letters, the
"No-Action Letters"); "Diskette" shall mean the diskette or
compact disc
attached to each of the Prospectus and the Memorandum; and "Data
File" shall
mean the compilation of information and data regarding the
Mortgage Loans
covered by the Agreed Upon Procedures Letters dated January 1,
2005 and rendered
by KPMG LLP (a "hard copy" of which Data File was initialed on
behalf of the
Seller and the Purchaser).
(c) As promptly as reasonably practicable after receipt by any
person
entitled to indemnification under this Section 7 (an
"indemnified party") of
notice of the commencement of any action, such indemnified party
will, if a
claim in respect thereof is to be made against the Seller (the
"indemnifying
party") under this Section 7, notify the indemnifying party in
writing of the
commencement thereof; but the omission so to notify the
indemnifying party will
not relieve it from any liability that it may have to any
indemnified party
under Section 7(a) (except to the extent that such omission has
prejudiced the
indemnifying party in any material respect) or from any
liability which it may
have otherwise than under this Section 7. In case any such
action is brought
against any indemnified party and it notifies the indemnifying
party of the
commencement thereof, the indemnifying party will be entitled to
participate
therein, and to the extent that it may elect by written notice
delivered to the
indemnified party promptly after receiving the aforesaid notice
from such
indemnified party, to assume the defense thereof, with counsel
selected by the
indemnifying party and reasonably satisfactory to such
indemnified party;
provided, however, that if the defendants in any such action
include both the
indemnified party and the indemnifying party and the indemnified
party or
parties shall have reasonably concluded that there may be legal
defenses
available to it or them and/or other indemnified parties that
are different from
or additional to those available to the indemnifying party, the
indemnified
party shall have the right to select separate counsel to assert
such legal
defenses and to otherwise participate in the defense of such
action on behalf of
such indemnified party or parties. Upon receipt of notice from
the indemnifying
party to such indemnified party of its election so to assume the
defense of such
action and approval by the indemnified party of counsel, the
indemnifying party
will not be liable for any legal or other expenses subsequently
incurred by such
indemnified party in connection with the defense thereof, unless
(i) the
indemnified party shall have employed separate counsel in
connection with the
assertion of legal defenses in accordance with the proviso to
the preceding
sentence (it being understood, however, that the indemnifying
party shall not be
liable for the expenses of more than one separate counsel,
approved by the
Purchaser, the Underwriters and the Initial Purchasers,
representing all the
indemnified parties under Section 7(a) who are parties to such
action), (ii) the
indemnifying party shall not have employed counsel reasonably
satisfactory to
the indemnified party to represent the indemnified party within
a reasonable
time after notice of commencement of the action or (iii) the
indemnifying party
has authorized the employment of counsel for the indemnified
party at the
expense of the indemnifying party; and except that, if clause
(i) or (iii) is
applicable, such liability shall only be in respect of the
counsel referred to
in such clause (i) or (iii). Unless it shall assume the defense
of any
proceeding, an indemnifying party shall not be liable for any
settlement of any
proceeding effected without its written consent but, if settled
with such
consent or if there be a final judgment for the plaintiff, the
indemnifying
party shall indemnify the indemnified party from and against any
loss or
liability by reason of such settlement or judgment.
Notwithstanding the
foregoing sentence, if at any time an indemnified party shall
have requested an
indemnifying party to reimburse the indemnified party for fees
and expenses of
counsel or any other expenses for which the indemnifying party
is obligated
under this subsection, the indemnifying party agrees that it
shall be liable for
any settlement of any proceeding effected without its written
consent if (i)
such settlement is entered into more than 45 days after receipt
by such
indemnifying party of the aforesaid request and (ii) such
indemnifying party
shall not have reimbursed the indemnified party in accordance
with such request
prior to the date of such settlement. If an indemnifying party
assumes the
defense of any proceeding, it shall be entitled to settle such
proceeding with
the consent of the indemnified party or, if such settlement
provides for an
unconditional release of the indemnified party in connection
with all matters
relating to the proceeding that have been asserted against the
indemnified party
in such proceeding by the other parties to such settlement,
which release does
not include a statement as to or an admission of fault,
culpability or a failure
to act by or on behalf of any indemnified party without the
consent of the
indemnified party.
(d) If the indemnification provided for in this Section 7 is
unavailable
to an indemnified party under Section 7(a) hereof or
insufficient in respect of
any losses, claims, damages or liabilities referred to therein,
then the
indemnifying party, in lieu of indemnifying such indemnified
party, shall
contribute to the amount paid or payable by such indemnified
party as a result
of such losses, claims, damages or liabilities, in such
proportion as is
appropriate to reflect the relative fault of the indemnified and
indemnifying
parties in connection with the statements or omissions which
resulted in such
losses, claims, damages or liabilities, as well as any other
relevant equitable
considerations (taking into account the parties' relative
knowledge and access
to information concerning the matter with respect to which the
claim was
asserted, the opportunity to correct and prevent any statement
or omission or
failure to comply, and any other equitable considerations
appropriate under the
circumstances). The relative fault of the indemnified and
indemnifying parties
shall be determined by reference to, among other things, whether
the untrue or
alleged untrue statement of a material fact or the omission or
alleged omission
to state a material fact relates to information supplied by such
parties;
provided that no Underwriter or Initial Purchaser shall be
obligated to
contribute more than its share of underwriting discounts and
commissions and
other fees pertaining to the Certificates less any damages
otherwise paid by
such Underwriter or Initial Purchaser with respect to such loss,
liability,
claim, damage or expense. It is hereby acknowledged that the
respective
Underwriters' and Initial Purchasers' obligations under this
Section 7 shall be
several and not joint. For purposes of this Section, each
person, if any, who
controls an Underwriter or an Initial Purchaser within the
meaning of Section 15
of the 1933 Act or Section 20 of the 1934 Act, and such
Underwriter's or Initial
Purchaser's officers and directors, shall have the same rights
to contribution
as such Underwriter or Initial Purchaser, as the case may be,
and each director
of the Seller and each person, if any who controls the Seller
within the meaning
of Section 15 of the 1933 Act or Section 20 of the 1934 Act
shall have the same
rights to contribution as the Seller.
(e) The Purchaser and the Seller agree that it would not be just
and
equitable if contribution pursuant to Section 7(d) were
determined by pro rata
allocation or by any other method of allocation that does not
take account of
the considerations referred to in Section 7(d) above. The amount
paid or payable
by an indemnified party as a result of the losses, claims,
damages and
liabilities referred to in this Section 7 shall be deemed to
include, subject to
the limitations set forth above, any legal or other expenses
reasonably incurred
by such indemnified party in connection with investigating or
defending any such
action or claim, except where the indemnified party is required
to bear such
expenses pursuant to this Section 7, which expenses the
indemnifying party shall
pay as and when incurred, at the request of the indemnified
party, to the extent
that the indemnifying party will be ultimately obligated to pay
such expenses.
If any expenses so paid by the indemnifying party are
subsequently determined to
not be required to be borne by the indemnifying party hereunder,
the party that
received such payment shall promptly refund the amount so paid
to the party
which made such payment. No person guilty of fraudulent
misrepresentation
(within the meaning of Section 11(f) of the 1933 Act) shall be
entitled to
contribution from any person who was not guilty of such
fraudulent
misrepresentation.
(f) The indemnity and contribution agreements contained in this
Section 7
shall remain operative and in full force and effect regardless
of (i) any
termination of this Agreement, (ii) any investigation made by
the Purchaser, the
Underwriters, the Initial Purchasers, any of their respective
directors or
officers, or any person controlling the Purchaser, the
Underwriters or the
Initial Purchasers, and (iii) acceptance of and payment for any
of the
Certificates.
(g) Without limiting the generality or applicability of any
other
provision of this Agreement, the Underwriters, the Initial
Purchasers and their
directors, officers and controlling parties shall be third-party
beneficiaries
of the provisions of this Section 7.
SECTION 8. Costs. The Seller shall pay (or shall reimburse the
Purchaser
to the extent that the Purchaser has paid) the Seller's pro rata
portion of the
aggregate of the following amounts (the Seller's pro rata
portion to be
determined according to the percentage that the Wachovia
Mortgage Loan Balance
represents as of the Cut-Off Date Pool Balance): (i) the costs
and expenses of
printing and delivering the Pooling and Servicing Agreement and
the
Certificates; (ii) the costs and expenses of printing (or
otherwise reproducing)
and delivering a preliminary and final Prospectus, Term Sheet
and Memorandum
relating to the Certificates; (iii) the initial fees, costs, and
expenses of the
Trustee (including reasonable attorneys' fees); (iv) the filing
fee charged by
the Securities and Exchange Commission for registration of the
Certificates so
registered; (v) the fees charged by the Rating Agencies to rate
the Certificates
so rated; (vi) the fees and disbursements of a firm of certified
public
accountants selected by the Purchaser and the Seller with
respect to numerical
information in respect of the Mortgage Loans and the
Certificates included in
the Prospectus, the Memorandum and any related Computational
Materials or ABS
Term Sheets, including in respect of the cost of obtaining any
"comfort letters"
with respect to such items; (vii) the reasonable out-of-pocket
costs and
expenses in connection with the qualification or exemption of
the Certificates
under state securities or "Blue Sky" laws, including filing fees
and reasonable
fees and disbursements of counsel in connection therewith, in
connection with
the preparation of any "Blue Sky" survey and in connection with
any
determination of the eligibility of the Certificates for
investment by
institutional investors and the preparation of any legal
investment survey;
(viii) the expenses of printing any such "Blue Sky" survey and
legal investment
survey; and (ix) the reasonable fees and disbursements of
counsel to the
Underwriters or Initial Purchasers; provided, however, Seller
shall pay (or
shall reimburse the Purchaser to the extent that the Purchaser
has paid) the
expense of recording any assignment of Mortgage or assignment of
Assignment of
Leases as contemplated by Section 2 hereof with respect to the
Seller's Mortgage
Loans. All other costs and expenses in connection with the
transactions
contemplated hereunder shall be borne by the party incurring
such expense.
SECTION 9. 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 hereof 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 Uniform
Commercial Code of the applicable jurisdiction; (ii) the
conveyance provided for
in Section 2 hereof shall be deemed to be a grant by the Seller
to the Purchaser
of a security interest in 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, from time to time held or invested in the
Certificate
Account, the Distribution Account or, if established, the REO
Account (each as
defined in the Pooling and Servicing Agreement) 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
hereof 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 Uniform
Commercial Code 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.
SECTION 10. Covenants of Purchaser. The Purchaser shall provide
the Seller
with all forms of Disclosure Materials (including the final form
of the
Memorandum and the preliminary and final forms of the Prospectus
Supplement)
promptly upon any such document becoming available.
SECTION 11. Notices. All notices, copies, requests, consents,
demands and
other communications required hereunder shall be in writing and
telecopied 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
telecopier or personally delivered or, in the case of a mailed
notice, upon
receipt, in each case given or addressed as aforesaid.
SECTION 12. 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 13. Severability of Provisions. Any part, provision,
representation, warranty or covenant of this Agreement that is
prohibited or
which is held to be void or unenforceable shall be ineffective
to the extent of
such prohibition or unenforceability without invalidating the
remaining
provisions hereof. Any part, provision, representation, warranty
or covenant of
this Agreement that is prohibited or unenforceable or is held to
be void or
unenforceable in any particular jurisdiction shall, as to such
jurisdiction, be
ineffective to the extent of such prohibition or
unenforceability without
invalidating the remaining provisions hereof, and any such
prohibition or
unenforceability in any particular jurisdiction shall not
invalidate or render
unenforceable such provision in any other jurisdiction. To the
extent permitted
by applicable law, the parties hereto waive any provision of law
which prohibits
or renders void or unenforceable any provision hereof.
SECTION 14. 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 15. 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 16. 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
which obtains the
principal relief it has sought, whether by compromise settlement
or judgment. If
the party which 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 17. 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 18. 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 and the Initial Purchasers (each as
intended third
party beneficiaries hereof) and their permitted successors and
assigns, and the
officers, directors and controlling persons referred to in
Section 7. 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.
SECTION 19. 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, or third party
beneficiary, against
whom such waiver or modification is sought to be enforced. No
amendment to the
Pooling and Servicing Agreement which relates to defined terms
contained
therein, Section 2.01(d) thereof or the repurchase obligations
or any other
obligations of the Seller shall be effective against the Seller
(in such
capacity) unless the Seller shall have agreed to such amendment
in writing.
SECTION 20. Accountants' Letters. The parties hereto shall
cooperate with
KPMG 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.
<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
------
WACHOVIA BANK, NATIONAL ASSOCIATION
By: /s/ Wayne M. Fitzgerald, II
--------------------------------------
Name: Wayne M. Fitzgerald, II
Title: Vice President
Address for Notices:
One Wachovia Center
301 South College Street
Charlotte, North Carolina 28288-0166
Telecopier No.: (704) 383-1942
Telephone No.: (704) 374-6161
PURCHASER
---------
WACHOVIA COMMERCIAL MORTGAGE
SECURITIES, INC.
By: /s/ William J. Cohane
--------------------------------------
Name: William J. Cohane
Title: Managing Director
Address for Notices:
One Wachovia Center
301 South College Street
Charlotte, North Carolina 28288-0166
Telecopier No.: (704) 383-1942
Telephone No.: (704) 374-6161
<PAGE>
SCHEDULE I
General Mortgage Representations and Warranties
For purposes of this Schedule I, the phrases "to the knowledge
of
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