Full Defeasance. (i) Provided no Event of Default shall then exist, Borrower shall have the right at any time after the Permitted Defeasance Date and prior to the Permitted Par Prepayment Date to voluntarily defease all, but not part, of the Loan by and upon satisfaction of the following conditions (such event being a “Defeasance Event”): (A) Borrower shall provide not less than thirty (30) days prior written notice to Lender specifying the Payment Date (the “Defeasance Date”) on which the Defeasance Event is to occur; (B) Borrower shall pay to Lender all accrued and unpaid interest on the principal balance of the Loan to and including the Defeasance Date. If for any reason the Defeasance Date is not a Payment Date, the Borrower shall also pay interest that would have accrued on the Note through and including the next Payment Date, provided, however, if the Defeasance Deposit shall include (or if the U.S. Obligations purchased with such Defeasance Deposit shall provide for payment of) all principal and interest computed from the Payment Date prior to the Defeasance Date through the next succeeding Payment Date, Borrower shall not be required to pay such short term interest pursuant to this sentence; (C) Borrower shall pay to Lender all other sums, not including scheduled interest or principal payments, then due under the Note, this Agreement, the Security Instrument and the other Loan Documents; (D) Borrower shall pay to Lender the required Defeasance Deposit for the Defeasance Event and comply with and satisfy the requirements of Section 2.5.1(a)(ii) below; (E) Borrower shall execute and deliver a pledge and security agreement, in form and substance satisfactory to Lender creating a first priority lien on the U.S. Obligations purchased with the Defeasance Deposit in accordance with the provisions of this Section 2.5 (the “Security Agreement”); (F) Borrower shall deliver an opinion of counsel for Borrower, delivered by counsel acceptable to Lender, stating, among other things but without substantive qualification, that (a) Lender has a valid, duly perfected, first priority security interest in the U.S. Obligations purchased with the Defeasance Deposit and that the Security Agreement is enforceable against Borrower in accordance with its terms, (b) the delivery of the U.S. Obligations purchased with the Defeasance Deposit to Lender does not constitute a fraudulent or preferential or other avoidable transfer under Bankruptcy Code Sections 547 and 548, (c) neither the defeasance nor any other transaction that occurs pursuant to the provisions of this Section 2.5.1(a) has caused or will cause the Loan (including for this purpose the Loan Documents) to cease to be a “qualified mortgage” within the meaning of Section 860G of the Code, either under the provisions of Treasury Regulation Sections 1.860G-2(a)(8) or 1.860G-2(b) (as such regulations may be amended or superseded from time to time) or under any other provision of the Code or otherwise, and (d) the defeasance and/or any other transaction that occurs pursuant to the provisions of this Section 2.5.1(a) will not cause the failure of any REMIC Trust or any other entity that holds the Note to maintain its tax status. The opinions set forth in clauses (a), (b), (c) and (d) above, or any portion thereof, may, in Lender’s discretion, be rendered by counsel to Lender at Borrower’s sole cost and expense; (G) If required by Lender, Borrower shall deliver confirmation in writing from each of the applicable Rating Agencies to the effect that such release will not result in a downgrade, withdrawal or qualification of the respective ratings in effect immediately prior to such Defeasance Event for the Securities issued in connection with the Securitization which are then outstanding. Borrower shall also deliver or cause to be delivered an Additional Insolvency Opinion with respect to the Successor Borrower from counsel satisfactory to Lender in form and substance satisfactory to Lender and the applicable Rating Agencies; (H) Borrower shall deliver an Officer’s Certificate certifying that (a) the requirements set forth in this Section 2.5.1(a) have been satisfied, (b) the transactions that are being carried out pursuant to this Section 2.5.1(a) (including specifically the release of the lien of the Security Instrument) are being effected to facilitate the disposition of the Property or any other customary commercial transaction and not as part of an arrangement to collateralize a REMIC Trust offering with obligations that are not real estate mortgages, and
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Full Defeasance. (i) Provided no Event of Default shall then exist, Borrower shall have the right at any time after the Permitted Defeasance Date and prior to the Permitted Par Prepayment Date to voluntarily defease all, but not part, of the Loan by and upon satisfaction of the following conditions (such event being a “Defeasance Event”):
(A) Borrower shall provide not less than thirty (30) days prior written notice to Lender specifying the Payment Date (the “Defeasance Date”) on which the Defeasance Event is to occur;
(B) Borrower shall pay to Lender all accrued and unpaid interest on the principal balance of the Loan to and including the Defeasance Date. If for any reason the Defeasance Date is not a Payment Date, the Borrower shall also pay interest that would have accrued on the Note through and including the next Payment Date, provided, however, if the Defeasance Deposit shall include (or if the U.S. Obligations purchased with such Defeasance Deposit shall provide for payment of) all principal and interest computed from the Payment Date prior to the Defeasance Date through the next succeeding Payment Date, Borrower shall not be required to pay such short term interest pursuant to this sentence;
(C) Borrower shall pay to Lender all other sums, not including scheduled interest or principal payments, then due under the Note, this Agreement, the Security Instrument and the other Loan Documents;
(D) Borrower shall pay to Lender the required Defeasance Deposit for the Defeasance Event and comply complies with and satisfy satisfies the requirements of Section 2.5.1(a)(ii) below;
(E) Borrower shall execute and deliver a pledge and security agreement, in form and substance satisfactory to Lender creating a first priority lien on the U.S. Obligations purchased with the Defeasance Deposit in accordance with the provisions of this Section 2.5 (the “Security Agreement”);
(F) Borrower shall deliver an opinion of counsel for Borrower, delivered by counsel acceptable to Lender, stating, among other things but without substantive qualification, that (a) Lender has a valid, duly perfected, first priority security interest in the U.S. Obligations purchased with the Defeasance Deposit and that the Security Agreement is enforceable against Borrower in accordance with its terms, (b) the delivery of the U.S. Obligations purchased with the Defeasance Deposit to Lender does not constitute a fraudulent or preferential or other avoidable transfer under Bankruptcy Code Sections 547 and 548, (c) neither the defeasance nor any other transaction that occurs pursuant to the provisions of this Section 2.5.1(a) has caused or will cause the Loan (including for this purpose the Loan Documents) to cease to be a “qualified mortgage” within the meaning of Section 860G of the Code, either under the provisions of Treasury Regulation Sections 1.860G-2(a)(8) or 1.860G-2(b) (as such regulations may be amended or superseded from time to time) or under any other provision of the Code or otherwise, and (d) the defeasance and/or any other transaction that occurs pursuant to the provisions of this Section 2.5.1(a) will not cause the failure of any REMIC Trust or any other entity that holds the Note to maintain its tax status. The opinions set forth in clauses (a), (b), (c) and (d) above, or any portion thereof, may, in Lender’s discretion, be rendered by counsel to Lender at Borrower’s sole cost and expense;
(G) If required by Lender, Borrower shall deliver confirmation in writing from each of the applicable Rating Agencies to the effect that such release will not result in a downgrade, withdrawal or qualification of the respective ratings in effect immediately prior to such Defeasance Event for the Securities issued in connection with the Securitization which are then outstanding. Borrower shall also deliver or cause to be delivered an Additional Insolvency Opinion with respect to the Successor Borrower from counsel satisfactory to Lender in form and substance satisfactory to Lender and the applicable Rating Agencies;
(H) Borrower shall deliver an Officer’s Certificate certifying that (a) the requirements set forth in this Section 2.5.1(a) have been satisfied, (b) the transactions that are being carried out pursuant to this Section 2.5.1(a) (including specifically the release of the lien of the Security Instrument) are being effected to facilitate the disposition of the Property or any other customary commercial transaction and not as part of an arrangement to collateralize a REMIC Trust offering with obligations that are not real estate mortgages, and (c) the amounts of the U.S. Obligations purchased with the Defeasance Deposit comply with all the requirements of this section including the requirement that the U.S. Obligations purchased with the Defeasance Deposit shall generate monthly amounts equal to or greater than the Scheduled Defeasance Payments required to be paid under the Note through the Maturity Date;
(I) Borrower shall deliver a certificate of Borrower’s independent certified public accountant, acceptable to Lender in its discretion, certifying that the U.S. Obligations purchased with the Defeasance Deposit generate monthly amounts equal to or greater than the Scheduled Defeasance Payments;
(J) Borrower shall deliver such other certificates, documents or instruments as Lender may reasonably request; and
(K) Borrower shall pay all costs and expenses of Lender incurred in connection with the Defeasance Event, including (A) any costs and expenses associated with a release of the Lien of the Security Instrument as provided in Section 2.6 hereof, (B) reasonable attorneys’ fees and expenses incurred in connection with the Defeasance Event, (C) the costs and expenses of the Rating Agencies, (D) any revenue, documentary stamp or intangible taxes or any other tax or charge due in connection with the transfer of the Note, or otherwise required to accomplish the defeasance and (E) the costs and expenses of Servicer and any trustee, including reasonable attorneys’ fees and expenses.
(ii) In connection with the Defeasance Event, Borrower shall use the Defeasance Deposit to purchase U.S. Obligations which provide payments on or prior to, but as close as possible to, all successive scheduled Payment Dates after the Defeasance Date upon which interest and principal payments are required under this Agreement and the Note, and in amounts equal to or more than the scheduled payments due on such Payment Dates under this Agreement and the Note (including scheduled payments of principal, interest, servicing fees (if any), and any other amounts due under the Loan Documents on such Payment Dates) and assuming the Note is prepaid in full on the Maturity Date (the “Scheduled Defeasance Payments”). Notwithstanding the foregoing, at Lender’s option, Lender, acting on Borrower’s behalf as Borrower’s agent and attorney-in-fact, shall use the Defeasance Deposit to purchase, or cause to be purchased, the above-referenced U.S. Obligations that Borrower is required to purchase pursuant to this Section 2.5.1(a)(ii). By depositing the Defeasance Deposit with Lender, Borrower shall thereby appoint Lender or Lender’s servicer or other agent as Borrower’s agent and attorney-in-fact, with full power of substitution, for the purpose of purchasing the U.S. Obligations with the Defeasance Deposit and delivering the U.S. Obligations to Lender. Borrower, pursuant to the Security Agreement or other appropriate document, shall authorize and direct that the payments received from the U.S. Obligations may be applied to satisfy the Debt Service obligations of Borrower under this Agreement and the Note. Any portion of the Defeasance Deposit in excess of the amount necessary to purchase the U.S. Obligations required by this Section 2.5 and satisfy Borrower’s other obligations under this Section 2.5 and Section 2.6 shall be remitted to Borrower.
(iii) If any notice of defeasance is given pursuant to Section 2.5.1(a)(i)(A), Borrower shall be required to defease the Loan on the Defeasance Date (unless such notice is revoked by Borrower prior to the Defeasance Date in which event Borrower shall immediately reimburse Lender for any and all reasonable costs and expenses incurred by Lender in connection with Borrower’s giving of such notice and revocation).
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Full Defeasance. Provided that as of the Release Date (ias hereinafter defined) Provided the Debt has not been accelerated, no Default or Event of Default shall then existexists, Borrower shall have may cause the right at any time after the Permitted Defeasance Date and prior to the Permitted Par Prepayment Date to voluntarily defease all, but not part, release of the Properties from the liens of the Security Instruments and the other Loan by and Documents (a "FULL DEFEASANCE") on any Monthly Payment Date following the Defeasance Lock-out Expiration Date upon Borrower's satisfaction of the following conditions (such event being a “Defeasance Event”):conditions:
(A) Borrower shall provide Lender not less than thirty (30) days prior written notice to Lender specifying the a Monthly Payment Date (such Date, or any extended date upon which Borrower and Lender may mutually agree is referred to herein as the “Defeasance Date”"RELEASE DATE") on which the Full Defeasance Event transaction is to occurbe consummated;
(B) On the Release Date Borrower shall pay to Lender in full all accrued and unpaid interest and all other sums due under this Note and under the other Loan Documents up to the Release Date, including all costs and expenses including attorneys' fees incurred by Lender or its servicers or other agent(s) or to or on behalf of any rating agencies in connection with such release and related transactions (including the principal balance review of the Loan to proposed Defeasance Collateral and including the preparation of the Defeasance Date. If for any reason Security Agreement (as hereinafter defined) and related documentation) together with a defeasance processing fee in an amount equal to one-half of one percent (0.5%) of the Defeasance Date is not a Payment Date, the Borrower shall also pay interest that would have accrued on the Note through and including the next Payment Date, provided, however, if the Defeasance Deposit shall include then Outstanding Principal Balance but in no event less than (A) $10,000 or if the U.S. Obligations purchased with such Defeasance Deposit shall provide for payment ofgreater than (B) all principal and interest computed from the Payment Date prior to the Defeasance Date through the next succeeding Payment Date, Borrower shall not be required to pay such short term interest pursuant to this sentence;$20,000; and
(C) Borrower shall pay deliver the following, all of which must be satisfactory to Lender in its sole discretion, at or prior to the release of the Properties and substitution of the Defeasance Collateral:
(1) Direct, non-callable and non-redeemable securities evidencing an obligation to pay principal and interest in a full and timely manner that are direct obligations of the United States of America for the payment of which its full faith and credit is pledged ("GOVERNMENT SECURITIES") in amounts sufficient to pay all scheduled principal and interest payments required under this Note (the "DEFEASANCE COLLATERAL"), which securities provide for payments prior, but as close as possible, to the Business Day prior to each successive Monthly Payment Date occurring after the Release Date, with each such payment being equal to or greater than the amount of the corresponding Monthly Payment required to be made hereunder for the balance of the term hereof plus the amount required to be paid on the Maturity Date (the "SCHEDULED DEFEASANCE PAYMENTS"), each of which shall be duly endorsed by the holder thereof as directed by Lender or accompanied by a written instrument of transfer in form and substance satisfactory to Lender in its sole discretion (including such instruments as may be required by the depository institution or other sumsentity holding such securities or the issuer thereof, not including scheduled as the case may be, to effectuate book-entry transfers and pledges through the book-entry facilities of such institution) in order to perfect upon the delivery of the Defeasance Security Agreement (as hereinafter defined) a valid, first priority lien and security interest or principal payments, then due under the Note, this Agreement, the Security Instrument therein in favor of Lender in conformity with all applicable state and the other Loan Documentsfederal laws governing granting of such security interest;
(D2) Borrower shall pay to any and all agreements, certificates, opinions, documents or instruments required by Lender in its sole discretion in connection with the required Full Defeasance Deposit for the Defeasance Event and comply with and satisfy the requirements of Section 2.5.1(a)(iiincluding (a) below;
(E) Borrower shall execute and deliver a pledge and security agreement, in form and substance satisfactory to Lender in its sole discretion, creating a first priority lien on the U.S. Obligations purchased with the Defeasance Deposit in accordance with the provisions of this Section 2.5 (the “Security Agreement”);
(F) Borrower shall deliver an opinion of counsel for Borrower, delivered by counsel acceptable to Lender, stating, among other things but without substantive qualification, that (a) Lender has a valid, duly perfected, first priority security interest in the U.S. Obligations purchased with favor of Lender in the Defeasance Deposit Collateral (the "DEFEASANCE SECURITY AGREEMENT"), and that the Security Agreement is enforceable against Borrower in accordance with its terms, (b) the delivery of the U.S. Obligations purchased with the Defeasance Deposit to any and all agreements, certificates, opinions, documents, or instruments required by Lender does not constitute a fraudulent in its sole discretion that affect or preferential or other avoidable transfer under Bankruptcy Code Sections 547 and 548, (c) neither the defeasance nor relate in any other transaction that occurs pursuant way to the provisions of this Section 2.5.1(a) has caused or will cause the Loan (including for this purpose the Loan Documents) to cease to be a “qualified mortgage” within the meaning of Section 860G of the Code, either under the provisions of Treasury Regulation Sections 1.860G-2(a)(8) or 1.860G-2(b) (as such regulations may be amended or superseded from time to time) or under any other provision of the Code or otherwise, and (d) the defeasance and/or any other transaction that occurs pursuant to the provisions of this Section 2.5.1(a) will not cause the failure of maintenance by any REMIC Trust or any other entity that holds the this Note to maintain of its qualification and status for tax status. The opinions set forth in clauses purposes as a REMIC (acollectively "REMIC QUALIFICATION DOCUMENTS"), (b), (c) and (d) above, or any portion thereof, may, in Lender’s discretion, be rendered by counsel to Lender at Borrower’s sole cost and expense;
(G3) If required by Lender, a certificate of Borrower shall deliver confirmation in writing from each of the applicable Rating Agencies to the effect that such release will not result in a downgrade, withdrawal or qualification of the respective ratings in effect immediately prior to such Defeasance Event for the Securities issued in connection with the Securitization which are then outstanding. Borrower shall also deliver or cause to be delivered an Additional Insolvency Opinion with respect to the Successor Borrower from counsel satisfactory to Lender in form and substance satisfactory to Lender and the applicable Rating Agencies;
(H) Borrower shall deliver an Officer’s Certificate certifying that (a) all of the requirements set forth in this Section 2.5.1(a9(b) have been satisfied, (b) the transactions that are being carried out pursuant to this Section 2.5.1(a9(b) (including specifically the release of the lien of the Security Instrument) are being effected to facilitate the disposition of the Property or any other customary commercial transaction and not as part of an arrangement to collateralize a REMIC Trust offering with obligations that are not real estate mortgages, anda
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Samples: Promissory Note (Captec Franchise Capital Partners L P Iv)
Full Defeasance. (i) Provided If there is a change in U.S. federal income tax law, we can legally release ourselves from all payment and other obligations on the Notes if we take the following actions below: • we must irrevocably deposit or cause to be deposited with the trustee as trust funds for the benefit of the all holders of the Notes cash, U.S. government obligations or a combination of cash and U.S. government obligations sufficient, without reinvestment, in the opinion of a nationally recognized firm, of independent public accountants, investment bank or appraisal firm, to generate enough cash to make interest, principal and any other applicable payments on the Notes on their various due dates; • we must deliver to the trustee a legal opinion confirming that there has been a change to the current U.S. federal income tax law or an Internal Revenue Service ruling that allows us to make the above deposit without causing holders to be taxed on the Notes any differently than if we did not make the deposit; • we must deliver to the trustee an officers’ certificate stating that the Notes, if then listed on any securities exchange, will not be delisted as a result of the deposit; • no default or Event of Default shall then exist, Borrower shall have the right at any time after the Permitted Defeasance Date and prior with respect to the Permitted Par Prepayment Date Notes has occurred and is continuing and no defaults or Events of Defaults related to voluntarily defease allbankruptcy, but insolvency or organization occurs during the 90 days following the deposit; • the full defeasance must not part, of the Loan by and upon satisfaction of the following conditions (such event being a “Defeasance Event”):
(A) Borrower shall provide not less than thirty (30) days prior written notice to Lender specifying the Payment Date (the “Defeasance Date”) on which the Defeasance Event is to occur;
(B) Borrower shall pay to Lender all accrued and unpaid interest on the principal balance of the Loan to and including the Defeasance Date. If for any reason the Defeasance Date is not a Payment Date, the Borrower shall also pay interest that would have accrued on the Note through and including the next Payment Date, provided, however, if the Defeasance Deposit shall include (or if the U.S. Obligations purchased with such Defeasance Deposit shall provide for payment of) all principal and interest computed from the Payment Date prior to the Defeasance Date through the next succeeding Payment Date, Borrower shall not be required to pay such short term interest pursuant to this sentence;
(C) Borrower shall pay to Lender all other sums, not including scheduled interest or principal payments, then due under the Note, this Agreement, the Security Instrument and the other Loan Documents;
(D) Borrower shall pay to Lender the required Defeasance Deposit for the Defeasance Event and comply with and satisfy the requirements of Section 2.5.1(a)(ii) below;
(E) Borrower shall execute and deliver a pledge and security agreement, in form and substance satisfactory to Lender creating a first priority lien on the U.S. Obligations purchased with the Defeasance Deposit in accordance with the provisions of this Section 2.5 (the “Security Agreement”);
(F) Borrower shall deliver an opinion of counsel for Borrower, delivered by counsel acceptable to Lender, stating, among other things but without substantive qualification, that (a) Lender has a valid, duly perfected, first priority security interest in the U.S. Obligations purchased with the Defeasance Deposit and that the Security Agreement is enforceable against Borrower in accordance with its terms, (b) the delivery of the U.S. Obligations purchased with the Defeasance Deposit to Lender does not constitute a fraudulent or preferential or other avoidable transfer under Bankruptcy Code Sections 547 and 548, (c) neither the defeasance nor any other transaction that occurs pursuant to the provisions of this Section 2.5.1(a) has caused or will cause the Loan (including for this purpose the Loan Documents) trustee to cease to be have a “qualified mortgage” conflicting interest within the meaning of Section 860G of the Code, either under Trust Indenture Act; • the provisions of Treasury Regulation Sections 1.860G-2(a)(8) or 1.860G-2(b) (as such regulations may be amended or superseded from time to time) or under any other provision of the Code or otherwise, and (d) the full defeasance and/or any other transaction that occurs pursuant to the provisions of this Section 2.5.1(a) will not cause the failure of any REMIC Trust or any other entity that holds the Note to maintain its tax status. The opinions set forth in clauses (a), (b), (c) and (d) above, or any portion thereof, may, in Lender’s discretion, be rendered by counsel to Lender at Borrower’s sole cost and expense;
(G) If required by Lender, Borrower shall deliver confirmation in writing from each of the applicable Rating Agencies to the effect that such release will must not result in a downgradebreach or violation of, withdrawal or qualification constitute a default under, the indenture or any other material agreements or instruments to which we are a party; • the full defeasance must not result in the trust arising from the deposit constituting an investment company within the meaning of the respective ratings Investment Company Act unless such trust will be registered under the Investment Company Act or exempt from registration thereunder; and • we must deliver to the trustee an officers’ certificate and a legal opinion from our counsel stating that all conditions precedent with respect to the full defeasance have been complied with. In the event that the trustee is unable to apply the funds held in effect immediately prior trust to the payment of obligations under the Notes by reason of a court order or governmental injunction or prohibition, then those of our obligations discharged under the full defeasance or covenant defeasance will be revived and reinstated as though no deposit of funds had occurred, until such Defeasance Event time as the trustee is permitted to apply all funds held in trust under the procedure described above may be applied to the payment of obligations under the Notes. However, if we make any payment of principal or interest on the Notes to the holders, we will have the right to receive such payments from the trust in the place of the holders. Upon our request contained in an officer’s certificate, the supplemental indenture and the base indenture will, as to the Notes cease to be of further effect, and the trustee, at our expense, will execute such instruments reasonably requested by us to acknowledge and satisfaction and discharge of the supplemental indenture and the base indenture as to the Notes if we take the following actions below: • we must irrevocably deposit or cause to be deposited with the trustee as trust funds for the Securities issued benefit of the all holders of the Notes cash, U.S. government obligations or a combination of cash and U.S. government obligations sufficient, without reinvestment, in the opinion of a nationally recognized firm, of independent public accountants, investment bank or appraisal firm, to generate enough cash to make interest, principal and any other applicable payments on the Notes on their various due dates (including any date of redemption for which a notice of redemption has properly been made in connection with the Securitization which are then outstanding. Borrower shall also deliver satisfaction and discharge); • no default or cause to be delivered an Additional Insolvency Opinion Event of Default with respect to the Successor Borrower Notes has occurred and is continuing and no defaults or Events of Defaults related to bankruptcy, insolvency or organization occurs during the 90 days following the deposit; • we must deliver to the trustee an officers’ certificate and a legal opinion from our counsel satisfactory stating that all conditions precedent with respect to Lender in form such satisfaction and substance satisfactory to Lender and the applicable Rating Agencies;
(H) Borrower shall deliver an Officer’s Certificate certifying that (a) the requirements set forth in this Section 2.5.1(a) discharge have been satisfied, (b) the transactions that are being carried out pursuant to this Section 2.5.1(a) (including specifically the release of the lien of the Security Instrument) are being effected to facilitate the disposition of the Property or any other customary commercial transaction and not as part of an arrangement to collateralize a REMIC Trust offering with obligations that are not real estate mortgages, andcomplied with.
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Samples: Sales Agreement
