Realization Upon Mortgaged Properties. (a) Upon the failure of any Borrower to make any required payment of principal, interest or other amounts due under a Mortgage Loan, or otherwise to perform fully any material obligations under any of the related Mortgage Loan Documents, in either case within any applicable grace period, the Master Servicer shall, upon discovery of such failure, promptly notify the Owner in writing. As directed in writing by the Owner in each instance, the Master Servicer or the Special Servicer shall issue notices of default, declare events of default, declare due the entire outstanding principal balance, and otherwise take all reasonable actions under the related Mortgage Loan in preparation for the Owner to realize upon the underlying collateral, including the Mortgage Property and the Additional Collateral. With respect to any Specially Serviced Mortgage Loan, the Special Servicer shall, as permitted under the provisions of the related Mortgage Loan Documents, and subject to the Owner’s prior written consent, foreclose upon or otherwise comparably convert the ownership of the related Mortgaged Property. In connection with such foreclosure or other conversion, the Special Servicer shall, subject to the consent or direction of the Owner, follow such practices and procedures as it shall deem necessary or advisable and as shall be consistent with Accepted Servicing Practices. All costs and expenses incurred by the Special Servicer in any such proceedings shall be paid by the Master Servicer as a Servicing Expense in accordance with Sections 3.03 and 5.02. Master Servicer or the Special Servicer, as applicable, shall consult with Owner regarding the selection and retention of legal counsel. (b) If title to any Mortgaged Property is acquired in foreclosure or by deed in lieu of foreclosure, the deed or certificate of sale shall be taken in the name of the Owner or its nominee, but in no event shall such deed or certificate be taken in the name of the Master Servicer or the Special Servicer. Notwithstanding any such acquisition of title and cancellation of the related Mortgage Loan, such Mortgage Loan shall be considered to be an REO Mortgage Loan held by the Owner until such time as the related REO Property shall be sold, transferred or conveyed by the Owner. Consistent with the foregoing, for purposes of all calculations hereunder, so long as such REO Mortgage Loan shall be considered to be an outstanding Mortgage Loan, payments and collections with respect to the related REO Property received in any month (net of related expenses) shall be applied to amounts which would have been payable under the related Note in accordance with the terms of such Note. (c) Except as otherwise provided in written instructions delivered to the Master Servicer or the Special Servicer by the Owner, the Master Servicer or the Special Servicer shall not obtain title to any Mortgaged Property as a result or in lieu of foreclosure or otherwise, and shall not otherwise acquire possession of, or take other action with respect to, any Mortgaged Property, if, as a result of any such action, the Owner would be considered to hold title to, to be a “mortgagee-in-possession” of, or to be an “owner” or “operator” of such Mortgaged Property within the meaning of any Environmental Law, or a “discharger” or “responsible party” thereunder, unless the Master Servicer or the Special Servicer has also previously determined, based on a report prepared by a Person who regularly conducts environmental site assessments, that: (i) such Mortgaged Property is in compliance with applicable Environmental Laws or, if not, that taking such actions as are necessary to bring such Mortgaged Property into compliance therewith is reasonably likely to produce a greater recovery on a present value basis than not taking such actions; and (ii) there are no circumstances present on such Mortgaged Property relating to the use, management or disposal of any hazardous materials for which investigation, testing, monitoring, containment, clean-up or remediation could be required under any applicable Environmental Law, or that, if any such hazardous materials are present for which such action could be required, taking such actions with respect to the affected Mortgaged Property is reasonably likely to produce a greater recovery on a present value basis than not taking such actions. If the Master Servicer or the Special Servicer, as applicable, has so determined based on satisfaction of the criteria in clauses (i) and (ii) above that it would be in the best economic interest of the Owner to take any such actions, the Master Servicer or the Special Servicer, as applicable, shall notify the Owner of such proposed action. The Master Servicer or the Special Servicer, as applicable, shall take such action only if authorized by the Owner in writing. The costs of any such compliance, containment, clean-up or remediation shall be paid by the Master Servicer as a Servicing Expense in accordance with Sections 3.03 and 5.02. If the environmental assessment first obtained by the Master Servicer or the Special Servicer with respect to a Mortgaged Property indicates that such Mortgaged Property may not be in compliance with applicable Environmental Laws but does not definitively establish such fact, the Master Servicer or the Special Servicer, subject to the Owner’s prior written consent, shall cause such further environmental assessments to be conducted. (d) The environmental site assessments contemplated by Section 3.09(c) shall be prepared by any Person who is recommended by the Master Servicer or the Special Servicer and approved in writing by the Owner or such other Person as directed in writing by the Owner, which Person shall be a qualified independent person (the precise scope and timing to be mutually agreed upon by the Owner and the Master Servicer or the Special Servicer). The report of the environmental assessment shall be delivered to the Owner, with a copy to the Master Servicer or the Special Servicer, and shall include an estimate of the cost to investigate and remediate the Mortgage Property and environmental hazard, or to otherwise address any noncompliance with applicable Environmental Laws or health and safety law and regulations or environmental condition (such as the presence of asbestos-containing materials). The Master Servicer, the Special Servicer or its agent shall provide a separate recommendation to the Owner as to whether it is advisable for the Owner or any REO Subsidiary to take title or otherwise become in possession of, assume the operation of (including appointment of a receiver) or take any other action with respect to the Mortgaged Property given the conclusions and information set forth in such environmental assessment report taking into account unique property features or characteristics. Such recommendations should identify the factual and legal basis for the recommendations and the applicable provisions of the Environmental Laws, the health and safety laws and regulations and other authorities relevant thereto, including a description of any reasonable steps required to avoid or minimize the potential of environmental liability regarding the environmental conditions on the Mortgaged Property in the event the Owner comes into possession, ownership or operation of the Mortgaged Property. The cost of preparation of any environmental assessment shall be paid by the Master Servicer as a Servicing Expense in accordance with Sections 3.03 and 5.02. If the Master Servicer or the Special Servicer determines, pursuant to Section 3.09(c), that taking such actions as are necessary to bring any Mortgaged Property into compliance with applicable Environmental Laws, or taking such actions with respect to the containment, clean-up, removal or remediation of hazardous substances, hazardous materials, hazardous wastes, or petroleum-based materials affecting any such Mortgaged Property, is not reasonably likely to produce a greater recovery on a present value basis than not taking such actions, then the Master Servicer or the Special Servicer shall take such action as directed in writing by the Owner, including, without limitation, releasing the lien of the related Mortgage with respect to the affected Mortgaged Property.
Appears in 2 contracts
Samples: Servicing Agreement, Servicing Agreement (Pennymac Financial Services, Inc.)
Realization Upon Mortgaged Properties. (a) Upon the failure of any Borrower to make any required payment of principal, interest or other amounts due under a Mortgage Loan, or otherwise to perform fully any material obligations under any of the related Mortgage Loan Documents, in either case within any applicable grace period, the Master Servicer shall, upon discovery of such failure, promptly notify the Owner Initial Class A Certificateholder in writing. As directed in writing by Consistent with the Owner in each instanceServicing Standard, the Master Servicer or the Special Servicer shall issue take such actions as it deems in the best economic interests of the Certificateholders, including without limitation, issuing notices of default, declare declaring events of default, declare declaring due the entire outstanding principal balance, and otherwise take taking all reasonable actions under the related Mortgage Loan Loan, as the case may be, in preparation for the Owner to realize realization upon the underlying collateral, including the Mortgage Property and the Additional CollateralMortgaged Property. With respect to any Specially Serviced Mortgage Loan, the Special The Servicer shall, consistent with the Servicing Standard, and as permitted under the provisions of the each related Mortgage Loan Documents, and subject to the Owner’s prior written consentMortgage, foreclose upon or otherwise comparably convert the ownership of the related Mortgaged Property. In connection with such foreclosure or other conversion, the Special Servicer shall, subject to the consent or direction of the Owner, shall follow such practices and procedures as it shall deem necessary or advisable and as shall be consistent with Accepted the Servicing PracticesStandard. All costs and expenses incurred by the Special Servicer in any such proceedings shall be -84- 92 paid by the Master Servicer as a Servicing Expense in accordance with Sections 3.03 and 5.02Expense. Master The Servicer or shall give notice within one (1) Business Day of the Special Servicer, as applicable, shall consult with Owner regarding commencement of any such action to the selection and retention of legal counselInitial Class A Certificateholder.
(b) If title to any Mortgaged Property is acquired in foreclosure or by deed in lieu of foreclosure, the deed or certificate of sale shall be taken in the name of the Owner Trust or its nominee, but in no event shall such deed or certificate be taken in the name of the Master Servicer or the Special Servicer. Notwithstanding any such acquisition of title and cancellation of the related Mortgage Loan, such Mortgage Loan shall be considered to be an REO Mortgage a Foreclosed Loan held by the Owner until such time as the related REO Foreclosure Property shall be sold, transferred or conveyed by the Ownerconveyed. Consistent with the foregoing, for purposes of all calculations hereunder, so long as such REO Mortgage Foreclosed Loan shall be considered to be an outstanding Mortgage Loan, payments and collections with respect to the related REO Foreclosure Property received in any month (net of related expenses) shall be applied to amounts which would have been payable under the related Promissory Note in accordance with the terms of such Promissory Note.
(c) Except as otherwise provided in written instructions delivered to the Master Servicer or the Special Servicer by the Owner, the Master Servicer or the Special The Servicer shall not obtain title to any Mortgaged Property as a result or in lieu of foreclosure or otherwise, and shall not otherwise acquire possession of, or take other action with respect to, any Mortgaged Property, if, as a result of any such action, the Certificateholders or Owner Trustee would be considered to hold title to, to be a “"mortgagee-in-possession” " of, or to be an “"owner” " or “"operator” " of such Mortgaged Property within the meaning of any Environmental Law, or a “"discharger” " or “"responsible party” " thereunder, unless the Master Servicer or the Special Servicer has also previously determined, based on a report report, prepared by a Person who regularly conducts environmental site assessments, that:
(i) such Mortgaged Property is in compliance with applicable Environmental Laws or, if not, that taking such actions as are necessary to bring such Mortgaged Property into compliance therewith is reasonably likely to produce a greater recovery on a present value basis than not taking such actions; and
(ii) there are no circumstances present on such Mortgaged Property relating to the use, management or disposal of any hazardous materials Hazardous Materials for which investigation, testing, monitoring, containment, clean-up or remediation could be required under any applicable Environmental Law, or that, if any such hazardous materials Hazardous Materials are present for which such action could be required, taking such actions with respect to the affected Mortgaged Property is reasonably likely to produce a greater recovery on a present value basis than not taking such actions. If the Master Servicer or the Special Servicer, as applicable, has so determined based on satisfaction of the criteria in clauses (i) and (ii) above that it would be in the best economic interest of the Owner Certificateholders to take any such actions, the Master Servicer or the Special Servicer, as applicable, shall notify the Owner Initial Class A Certificateholder of such proposed action. The Master Servicer or the Special Servicer, as applicable, shall take such action only if authorized by the Owner Majority Certificateholders in writing. The costs of any such compliance, containment, clean-up or remediation shall be paid by the Master Servicer as a Servicing Expense in accordance with Sections 3.03 and 5.02Expense. The Servicer shall give If the environmental assessment first obtained by the Master Servicer or the Special Servicer with respect to a Mortgaged Property indicates that such Mortgaged Property may not be in compliance with applicable Environmental Laws or that Hazardous Materials may be present but does not definitively establish such fact, the Master Servicer or the Special Servicer, subject to the Owner’s prior written consent, shall cause such further environmental assessments to be conducted.
(d) The environmental site assessments contemplated by Section 3.09(c5.10(c) shall be prepared by any Person who is recommended approved by the Master Servicer or in accordance with the Special Servicer and approved in writing by the Owner or such other Person as directed in writing by the Owner, which Person shall be a qualified independent person (the precise scope and timing to be mutually agreed upon by the Owner and the Master Servicer or the Special Servicer). The report of the environmental assessment shall be delivered to the Owner, with a copy to the Master Servicer or the Special Servicer, and shall include an estimate of the cost to investigate and remediate the Mortgage Property and environmental hazard, or to otherwise address any noncompliance with applicable Environmental Laws or health and safety law and regulations or environmental condition (such as the presence of asbestos-containing materials). The Master Servicer, the Special Servicer or its agent shall provide a separate recommendation to the Owner as to whether it is advisable for the Owner or any REO Subsidiary to take title or otherwise become in possession of, assume the operation of (including appointment of a receiver) or take any other action with respect to the Mortgaged Property given the conclusions and information set forth in such environmental assessment report taking into account unique property features or characteristics. Such recommendations should identify the factual and legal basis for the recommendations and the applicable provisions of the Environmental Laws, the health and safety laws and regulations and other authorities relevant thereto, including a description of any reasonable steps required to avoid or minimize the potential of environmental liability regarding the environmental conditions on the Mortgaged Property in the event the Owner comes into possession, ownership or operation of the Mortgaged PropertyServicing Standard. The cost of preparation of any environmental assessment shall be paid by the Master Servicer as a Servicing Expense in accordance with Sections 3.03 and 5.02. Expense.
(e) If the Master Servicer or the Special Servicer determines, pursuant to Section 3.09(c5.10(c), that taking such actions as are necessary to bring any Mortgaged Property into compliance with applicable Environmental Laws, or taking such actions with respect to the containment, clean-up, removal or remediation of hazardous substances, hazardous materials, hazardous wastes, or petroleum-based materials affecting any such Mortgaged Property, is not reasonably likely to produce a greater recovery on a present value basis than not taking such actions, then the Master Servicer or the Special Servicer shall take such action as directed it would be in writing by the Ownerbest economic interest of the Certificateholders, including, without limitation, releasing the lien of the related Mortgage with respect to the affected Mortgaged Property. The Servicer shall give notice within one (1) Business Day of any such action to the Initial Class A Certificateholder.
Appears in 1 contract
Realization Upon Mortgaged Properties. (a) Upon the failure of any Borrower to make any required payment of principal, interest or other amounts due under a Mortgage Loan, or otherwise to perform fully any material obligations under any of the related Mortgage Loan Documents, in either case within any applicable grace period, the Master Servicer shall, upon discovery of such failure, promptly notify the Owner in writing. As directed in writing by the Owner in each instance, the Master Servicer or the Special Servicer shall issue notices of default, declare events of default, declare due the entire outstanding principal balance, and otherwise take all reasonable actions under the related Mortgage Loan in preparation for the Owner to realize upon the underlying collateral, including the Mortgage Property and the Additional Collateral. With respect to any Specially Serviced Mortgage Loan, the Special Servicer shall, as permitted under the provisions of the related Mortgage Loan Documents, and subject to the Owner’s 's prior written consent, foreclose upon or otherwise comparably convert the ownership of the related Mortgaged Property. In connection with such foreclosure or other conversion, the Special Servicer shall, subject to the consent or direction of the Owner, follow such practices and procedures as it shall deem necessary or advisable and as shall be consistent with Accepted Servicing Practices. All costs and expenses incurred by the Special Servicer in any such proceedings shall be paid by the Master Servicer as a Servicing Expense in accordance with Sections 3.03 and 5.02. Master Servicer or the Special Servicer, as applicable, shall consult with Owner regarding the selection and retention of legal counselExpense.
(b) If title to any Mortgaged Property is acquired in foreclosure or by deed in lieu of foreclosure, the deed or certificate of sale shall be taken in the name of the Owner or its nominee, but in no event shall such deed or certificate be taken in the name of the Master Servicer or the Special Servicer. Notwithstanding any such acquisition of title and cancellation of the related Mortgage Loan, such Mortgage Loan shall be considered to be an REO Mortgage Loan held by the Owner until such time as the related REO Property shall be sold, transferred or conveyed by the Owner. Consistent with the foregoing, for purposes of all calculations hereunder, so long as such REO Mortgage Loan shall be considered to be an outstanding Mortgage Loan, payments and collections with respect to the related REO Property received in any month (net of related expenses) shall be applied to amounts which would have been payable under the related Note in accordance with the terms of such Note.
(c) Except as otherwise provided in written instructions delivered to the Master Servicer or the Special Servicer by the Owner, the Master Servicer or the Special Servicer shall not obtain title to any Mortgaged Property as a result or in lieu of foreclosure or otherwise, and shall not otherwise acquire possession of, or take other action with respect to, any Mortgaged Property, if, as a result of any such action, the Owner would be considered to hold title to, to be a “"mortgagee-in-possession” " of, or to be an “"owner” " or “"operator” " of such Mortgaged Property within the meaning of any Environmental Law, or a “"discharger” " or “"responsible party” " thereunder, unless the Master Servicer or the Special Servicer has also previously determined, based on a report prepared by a Person who regularly conducts environmental site assessments, that:
(i) such Mortgaged Property is in compliance with applicable Environmental Laws or, if not, that taking such actions as are necessary to bring such Mortgaged Property into compliance therewith is reasonably likely to produce a greater recovery on a present value basis than not taking such actions; and
(ii) there are no circumstances present on such Mortgaged Property relating to the use, management or disposal of any hazardous materials for which investigation, testing, monitoring, containment, clean-up or remediation could be required under any applicable Environmental Law, or that, if any such hazardous materials are present for which such action could be required, taking such actions with respect to the affected Mortgaged Property is reasonably likely to produce a greater recovery on a present value basis than not taking such actions. If the Master Servicer or the Special Servicer, as applicable, has so determined based on satisfaction of the criteria in clauses (i) and (ii) above that it would be in the best economic interest of the Owner to take any such actions, the Master Servicer or the Special Servicer, as applicable, shall notify the Owner of such proposed action. The Master Servicer or the Special Servicer, as applicable, shall take such action only if authorized by the Owner in writing. The costs of any such compliance, containment, clean-up or remediation shall be paid by the Master Servicer as a Servicing Expense in accordance with Sections 3.03 and 5.02. If the environmental assessment first obtained by the Master Servicer or the Special Servicer with respect to a Mortgaged Property indicates that such Mortgaged Property may not be in compliance with applicable Environmental Laws but does not definitively establish such fact, the Master Servicer or the Special Servicer, subject to the Owner’s prior written consent, shall cause such further environmental assessments to be conducted.
(d) The environmental site assessments contemplated by Section 3.09(c) shall be prepared by any Person who is recommended by the Master Servicer or the Special Servicer and approved in writing by the Owner or such other Person as directed in writing by the Owner, which Person shall be a qualified independent person (the precise scope and timing to be mutually agreed upon by the Owner and the Master Servicer or the Special Servicer). The report of the environmental assessment shall be delivered to the Owner, with a copy to the Master Servicer or the Special Servicer, and shall include an estimate of the cost to investigate and remediate the Mortgage Property and environmental hazard, or to otherwise address any noncompliance with applicable Environmental Laws or health and safety law and regulations or environmental condition (such as the presence of asbestos-containing materials). The Master Servicer, the Special Servicer or its agent shall provide a separate recommendation to the Owner as to whether it is advisable for the Owner or any REO Subsidiary to take title or otherwise become in possession of, assume the operation of (including appointment of a receiver) or take any other action with respect to the Mortgaged Property given the conclusions and information set forth in such environmental assessment report taking into account unique property features or characteristics. Such recommendations should identify the factual and legal basis for the recommendations and the applicable provisions of the Environmental Laws, the health and safety laws and regulations and other authorities relevant thereto, including a description of any reasonable steps required to avoid or minimize the potential of environmental liability regarding the environmental conditions on the Mortgaged Property in the event the Owner comes into possession, ownership or operation of the Mortgaged Property. The cost of preparation of any environmental assessment shall be paid by the Master Servicer as a Servicing Expense in accordance with Sections 3.03 and 5.02. If the Master Servicer or the Special Servicer determines, pursuant to Section 3.09(c), that taking such actions as are necessary to bring any Mortgaged Property into compliance with applicable Environmental Laws, or taking such actions with respect to the containment, clean-up, removal or remediation of hazardous substances, hazardous materials, hazardous wastes, or petroleum-based materials affecting any such Mortgaged Property, is not reasonably likely to produce a greater recovery on a present value basis than not taking such actions, then the Master Servicer or the Special Servicer shall take such action as directed in writing by the Owner, including, without limitation, releasing the lien of the related Mortgage with respect to the affected Mortgaged Property.
Appears in 1 contract
Samples: Servicing Agreement (Impac Commercial Holdings Inc)
Realization Upon Mortgaged Properties. (a) Upon the failure of any Borrower to make any required payment of principal, interest or other amounts due under a Mortgage Loan, or otherwise to perform fully any material obligations under any of the related Mortgage Loan Documents, in either case within any applicable grace period, the Master Servicer shall, upon discovery of such failure, promptly notify the Owner Master Servicer in writing. As directed In accordance with the operating procedures set forth in writing by the Owner in each instanceExhibit “C” attached hereto, the Master Servicer or the Special Servicer shall issue notices of default, declare events of default, declare due the entire outstanding principal balance, and otherwise take all reasonable actions under the related Mortgage Loan in preparation for the Owner Master Servicer to realize upon the underlying collateral, including the Mortgage Property and the Additional Collateral. With respect to any Specially Serviced Mortgage Loan, the Special Servicer shall, as permitted under the provisions of the related Mortgage Loan Documents, and subject to the OwnerMaster Servicer’s prior written consent, foreclose upon or otherwise comparably convert the ownership of the related Mortgaged Property. In connection with such foreclosure or other conversion, the Special Servicer shall, subject to the consent or direction of the OwnerMaster Servicer, follow such practices and procedures as it shall deem necessary or advisable and as shall be consistent with Accepted Servicing Practices. All costs and expenses incurred by the Special Servicer in any such proceedings shall be paid by the Master Servicer as a Servicing Expense in accordance with Sections 3.03 and 5.02. Master Servicer or the Special Servicer, as applicable, shall consult with Owner regarding the selection and retention of legal counselAdvance.
(b) If title to any Mortgaged Property is acquired in foreclosure or by deed in lieu of foreclosure, the deed or certificate of sale shall be taken in the name of the Owner Master Servicer’s nominee, or its nomineeafter Securitization the nominee of the Securitization trustee, but in no event shall such deed or certificate be taken in the name of the Master Servicer or the Special Servicer. Notwithstanding any such acquisition of title and cancellation of the related Mortgage Loan, such Mortgage Loan shall be considered to be an REO Mortgage Loan held by the Owner Master Servicer or after Securitization the Securitization trustee until such time as the related REO Property shall be sold, transferred or conveyed by the OwnerMaster Servicer or such trustee. Consistent with the foregoing, for purposes of all calculations hereunder, so long as such REO Mortgage Loan shall be considered to be an outstanding Mortgage Loan, payments and collections with respect to the related REO Property received in any month (net of related expenses) shall be applied to amounts which would have been payable under the related Note in accordance with the terms of such Note.
(c) Except as otherwise provided in written instructions delivered to the Master Servicer or the Special Servicer by the OwnerMaster Servicer, the Master Servicer or the Special Servicer shall not obtain title to any Mortgaged Property as a result or in lieu of foreclosure or otherwise, and shall not otherwise acquire possession of, or take other action with respect to, any Mortgaged Property, if, as a result of any such action, the Owner Master Servicer, or after Securitization the Securitization trustee, would be considered to hold title to, to be a “mortgagee-in-possession” of, or to be an “owner” or “operator” of such Mortgaged Property within the meaning of any Environmental Law, or a “discharger” or “responsible party” thereunder, unless the Master Servicer or the Special Servicer has also previously determined, based on a report prepared by a Person who regularly conducts environmental site assessments, that:
(i) such Mortgaged Property is in compliance with applicable Environmental Laws or, if not, that taking such actions as are necessary to bring such Mortgaged Property into compliance therewith is reasonably likely to produce a greater recovery on a present value basis than not taking such actions; and
(ii) there are no circumstances present on such Mortgaged Property relating to the use, management or disposal of any hazardous materials Hazardous Materials for which investigation, testing, monitoring, containment, clean-up or remediation could be required under any applicable Environmental Law, or that, if any such hazardous materials Hazardous Materials are present for which such action could be required, taking such actions with respect to the affected Mortgaged Property is reasonably likely to produce a greater recovery on a present value basis than not taking such actions. If the Master Servicer or the Special Servicer, as applicable, has so determined based on satisfaction of the criteria in clauses (i) and (ii) above that it would be in the best economic interest of the Owner Master Servicer, or after Securitization the Securitization trustee, to take any such actions, the Master Servicer or the Special Servicer, as applicable, shall notify the Owner Master Servicer of such proposed action. The Master Servicer or the Special Servicer, as applicable, shall take such action only if authorized by the Owner Master Servicer in writing. The costs of any such compliance, containment, clean-up or remediation shall be paid by the Master Servicer as a Servicing Expense in accordance with Sections 3.03 and 5.02Expense. If the environmental assessment first obtained by the Master Servicer or the Special Servicer with respect to a Mortgaged Property indicates that such Mortgaged Property may not be in compliance with applicable Environmental Laws or that Hazardous Materials may be present but does not definitively establish such fact, the Master Servicer or the Special Servicer, subject to the OwnerMaster Servicer’s prior written consent, shall cause such further environmental assessments to be conducted.
(d) The environmental site assessments contemplated by Section 3.09(c) shall be prepared by any Person who is recommended by the Master Servicer or the Special Servicer and approved in writing by the Owner Master Servicer or such other Person as directed in writing by the Owner, which Person shall be a qualified independent person (the precise scope and timing to be mutually agreed upon by the Owner and the Master Servicer or the Special Servicer). The report of the environmental assessment shall be delivered to the Owner, with a copy to the Master Servicer or the Special Servicer, and shall include an estimate of the cost to investigate and remediate the Mortgage Property and environmental hazard, or to otherwise address any noncompliance with applicable Environmental Laws or health and safety law and regulations or environmental condition (such as the presence of asbestos-containing materials). The Master Servicer, the Special Servicer or its agent shall provide a separate recommendation to the Owner as to whether it is advisable for the Owner or any REO Subsidiary to take title or otherwise become in possession of, assume the operation of (including appointment of a receiver) or take any other action with respect to the Mortgaged Property given the conclusions and information set forth in such environmental assessment report taking into account unique property features or characteristics. Such recommendations should identify the factual and legal basis for the recommendations and the applicable provisions of the Environmental Laws, the health and safety laws and regulations and other authorities relevant thereto, including a description of any reasonable steps required to avoid or minimize the potential of environmental liability regarding the environmental conditions on the Mortgaged Property in the event the Owner comes into possession, ownership or operation of the Mortgaged Property. The cost of preparation of any environmental assessment shall be paid by the Master Servicer as a Servicing Expense in accordance with Sections 3.03 and 5.02. Expense.
(e) If the Master Servicer or the Special Servicer determines, pursuant to Section 3.09(c), that taking such actions as are necessary to bring any Mortgaged Property into compliance with applicable Environmental Laws, or taking such actions with respect to the containment, clean-up, removal or remediation of hazardous substances, hazardous materials, hazardous wastes, or petroleum-based materials affecting any such Mortgaged Property, is not reasonably likely to produce a greater recovery on a present value basis than not taking such actions, then the Master Servicer or the Special Servicer shall take such action as directed in writing by the OwnerMaster Servicer, including, without limitation, releasing the lien of the related Mortgage with respect to the affected Mortgaged Property.
Appears in 1 contract
Realization Upon Mortgaged Properties. Extension of Balloon Payments on Mortgage Loan; Modification, Amendment or Waiver of Mortgage Loan.
(a) Upon the failure of any Borrower to make any required payment of principal, interest or other amounts due under a Mortgage Loan, or otherwise to perform fully any material obligations under any of the related Mortgage Loan Documents, in either case within any applicable grace period, the Master The Servicer shall, upon discovery of such failure, promptly notify the Owner in writing. As directed in writing by the Owner in each instanceconsistent with Accepted Servicing Practices, the Master Servicer or the Special Servicer shall issue notices provisions of defaultSections 3.7(c), declare events of default, declare due the entire outstanding principal balance, (d) and otherwise take all reasonable actions under the related Mortgage Loan in preparation for the Owner to realize upon the underlying collateral, including the Mortgage Property (e) and the Additional Collateral. With respect to any Specially Serviced Mortgage Loan, the Special Servicer shall, as permitted under the provisions of the related Mortgage Loan DocumentsMortgage, institute collection procedures and subject to the Owner’s prior written consent, foreclose upon or otherwise comparably convert the ownership of the related Mortgaged PropertyProperty upon the occurrence of a Mortgage Event of Default, as permitted under the Mortgage. In connection with such foreclosure or other conversion, the Special Servicer shallshall employ Accepted Servicing Practices, including preserving its rights to all available remedies. Notwithstanding the preceding paragraph, (i) the Servicer, upon an actual default by the Borrowers in making any of the Balloon Payments on the Scheduled Maturity Date but prior to commencement of foreclosure, shall in writing request that the Trustee notify in writing the Certificateholders of such failure to pay, (ii) within five Business Days of its receipt of such request, the Trustee shall so notify the Certificateholders, including notice that unless within 30 days of the mailing of the Servicer's request to the Trustee the Trustee has received written instruction from all of the Holders of Class A, Class B, Class C and Class D Certificates affected by such failure to pay, instructing the Servicer (1) to forebear from exercising such remedies and (2) to extend the due date of the Balloon Payments, the Servicer shall promptly commence foreclosure, and (iii) if within such 30-day period the Trustee has received such written instruction from Holders from each Class of Certificates affected by any extension of a Balloon Payment and each Class junior in right to payment of such Class, then in such case the Servicer shall forebear from exercising such remedies, modify the Mortgage Notes, subject to Section 3.7(d) hereof, to extend the consent or direction Balloon Payments to a date that is not more than one year after the Scheduled Maturity Date and notify the Rating Agency in writing of such extension and the Ownerdate thereof. During the period that the Trust Fund holds a Foreclosed Property, follow Foreclosure Proceeds and any other amounts received with respect to such practices and procedures as it shall deem necessary or advisable and as Foreclosed Property (including any Liquidation Proceeds received prior to the time the Mortgaged Property becomes a Liquidated Mortgaged Property) shall be consistent applied, after payment of any related expenses (including any taxes owed pursuant to the REMIC Provisions), first, to reimburse any Advance with Accepted Servicing Practices. All costs and expenses incurred by respect to such Mortgaged Property together with Advance Interest thereon, second, to pay interest currently due or deemed to be due on the Special Servicer in any such proceedings shall be paid by Mortgage Loan Principal Balance and, third, to reduce the Master Servicer as a Servicing Expense in accordance with Sections 3.03 and 5.02. Master Servicer or the Special Servicer, as applicable, shall consult with Owner regarding the selection and retention of legal counselMortgage Loan Principal Balance.
(b) If title to any Mortgaged Property is acquired in foreclosure or by deed in lieu of foreclosure, the deed or certificate of sale shall be taken in the name of the Owner or its nominee, but in no event shall such deed or certificate be taken in the name of the Master Servicer or the Special Servicer. Notwithstanding any such acquisition of title and cancellation of the related Mortgage Loan, such Mortgage Loan shall be considered to be an REO Mortgage Loan held by the Owner until such time as the related REO Property shall be sold, transferred or conveyed by the Owner. Consistent with the foregoing, the Servicer shall not acquire for purposes the benefit of all calculations hereunderthe Trust Fund any personal property pursuant to this Section 3.7(b) or otherwise unless either:
(i) such personal property is incidental to real property (within the meaning of Section 856(e)(1) of the Code) so acquired by the Servicer for the benefit of the Trust Fund; or
(ii) the Servicer shall have requested and received a Nondisqualification Opinion, so long at the expense of the Trust Fund (provided such expense may be expended by the Servicer subject to reimbursement as such REO Mortgage Loan shall be considered a Servicing Advance pursuant to be an outstanding Mortgage Loan, payments and collections Section 3.3(e)(iv) hereof) with respect to the related REO Property received in any month (net of related expenses) shall be applied to amounts which would have been payable under the related Note in accordance with the terms holding of such Noteproperty.
(c) Except Notwithstanding the provisions of Sections 3.8(a) and 3.7(d) hereof, upon the occurrence of a Monetary Default due solely to the failure by the Borrowers to pay interest (other than Default Interest) on the Mortgage Loan on any Due Date, and a determination in good faith by the Servicer (such determination to be final, conclusive and binding on the Trustee and Certificateholders) that any Interest Advance necessary to cover the resultant shortfall would be a Nonrecoverable Advance, the Servicer shall accelerate the Mortgage Loan and, if the Mortgage Loan is not immediately paid in full, pursue foreclosure remedies with respect to the Mortgaged Property in accordance with applicable law.
(d) In the event that a material Monetary Default with respect to the Mortgage Loan has occurred, if the Servicer determines that a modification, waiver or amendment of the terms of the Mortgage Loan is reasonably likely to produce a greater recovery on a present value basis than foreclosure or other liquidation of the Mortgaged Properties, then, the Servicer may, but is not required to, agree to a modification, waiver or amendment of any of the terms of the Mortgage Loan; provided, however, that the Servicer agrees not to permit any modification with respect to the Mortgage Loan that would (i) change the rate of interest on the related Mortgage Notes, (ii) extend, except as otherwise provided in written instructions delivered Section 3.7(a) hereof, the maturity date of such Mortgage Loan, (iii) defer payment of interest due on the related Mortgage Notes, (iv) forgive any principal or interest thereof or (v) affect the priority of the Mortgage or any other Loan Documents, unless the Servicer has notified the Trustee and directed the Trustee in writing to notify the Certificateholders of such proposed modification and the Trustee has notified the Servicer that such modification has been approved by all of the Holders of each Class of Certificates affected by such modification and each Class junior in right of payment of such Class; and provided, that no such modification shall release, or affect the priority of, the lien of the Mortgage or any Loan Documents on any Mortgaged Property or substitute a property for a Mortgaged Property unless the Servicer has obtained a Nondisqualification Opinion with respect to such modification, which opinion shall be obtained at the expense of the Trust Fund (provided such expense may be expended by the Servicer as a Servicing Advance subject to reimbursement pursuant to Section 3.3(e)(iv) hereof). Subject in all respects to the Master Servicer provisions of the preceding paragraph, (1) upon the occurrence of a Mortgage Event of Default (including non-payment of any amount due under the Mortgage Loan on the Scheduled Maturity Date) or (2) upon the Special Servicer notification by the OwnerBorrowers to the Servicer within 90 days of the Scheduled Maturity Date that they will not make the Balloon Payments in full when due and the determination by the Servicer that default on the Mortgage Notes is imminent, if the Servicer determines that a modification, waiver or amendment of the terms of the Mortgage Loan is reasonably likely to produce a greater recovery on a present value basis than foreclosure or other liquidation of one, some or all of the Mortgaged Property, then the Servicer shall in writing request that the Trustee notify the Holders of the Class A, Class B, Class C and Class D Certificates to such effect. The Trustee shall, within five Business Days of receiving such request, so notify such Certificateholders, which notice shall include notification that written consent is required by Holders of in excess of 50% in the case of clause (1) above and 100% in the case of clause (2) above of the Aggregate Certificate Balance of each Class of Certificates (other than the Class R Certificates) affected by such modification, waiver or amendment (and in the case of clause (2) above, each Class junior in right to payment of such Class), for the Servicer to effect such proposed waiver, modification or amendment, and that the Certificateholders who fail to respond in writing within 40 days of the date of the Servicer's notice to the Trustee shall be deemed to have declined such proposed modification, amendment or waiver. The Trustee, having so notified such Certificateholders in writing and having obtained the consent thereto of the Holders of in excess of 50% in the case of clause (1) above and 100% in the case of clause (2) above, of the Aggregate Certificate Balance of each Class of Certificates (other than the Class R Certificate) affected by such modification, waiver or amendment (and, in the case of clause (2) above, each Class junior in right to payment of such Class), may permit such modification, waiver or amendment; provided that if any of such Certificateholders fails to respond in writing within 40 days from the date the Servicer so notifies the Trustee, such Certificateholder shall be deemed to have declined to allow such proposed modification, waiver or amendment. Notwithstanding anything to the contrary set forth above, (A) the Balloon Payments may not be extended to a date that is more than one year after the Scheduled Maturity Date and (B) no modification, waiver or amendment shall release the lien, or affect the priority of, the Master Servicer Mortgage or any Loan Documents on any of the Special Mortgaged Property or substitute a property for a Mortgaged Property or alter in any material respect any provision of the Mortgage or any other Loan Document unless with respect to this clause (B), (i) the Trustee has obtained, at the expense of the Borrowers, a Nondisqualification Opinion with respect to such modification, waiver or amendment or (ii) the consent of all of the Certificateholders affected by such modification, waiver or amendment and each Class junior in right to payment of such Class is obtained. The Servicer shall not notify in writing the Rating Agency promptly upon effecting such modification, waiver or amendment.
(e) Notwithstanding the provisions of Section 3.7(a) hereof, the Servicer shall not, on behalf of the Trust Fund, obtain title to any a Mortgaged Property as a result or in lieu of foreclosure or otherwiseother legal process in connection with a default, and shall not otherwise acquire possession of, or take other action with respect to, any Mortgaged Property, if, as a result of any such action, the Owner Trustee, on behalf of the Trust Fund, would be considered to hold title to, to be a “"mortgagee-in-possession” " of, or to be an “"owner” " or “"operator” " of such Mortgaged Property within the meaning of the Comprehensive Environmental Responsibility Cleanup and Liability Act of 1980, as amended from time to time, or any Environmental Lawapplicable comparable federal, state or local law, or a “"discharger” " or “"responsible party” " thereunder, unless the Master Servicer or the Special Servicer has also previously determineddetermined in accordance with Accepted Servicing Practices, based on a report prepared by in accordance with Section 3.7(f) hereof (a Person who regularly conducts environmental site assessmentscopy of which report, which shall include an estimate of the cost of remediation to the extent that cost of remediation can be estimated, shall be delivered to the Trustee), that:
(i) such Mortgaged Property is in compliance with applicable Environmental Laws or, if not, that taking such actions as are necessary to bring such the Mortgaged Property into in compliance therewith is reasonably likely to produce a greater recovery on a present value basis than not taking such actions; and;
(ii) there are no circumstances present on at such Mortgaged Property relating to the use, management or disposal of any hazardous substances, hazardous materials, hazardous wastes, or petroleum-based materials for which investigation, testing, monitoring, containment, clean-up or remediation could be required under any applicable Environmental Lawfederal, state or local law or regulation, or that, if any such hazardous materials are present for which such action could be required, taking such actions with respect to the affected Mortgaged Property is reasonably likely to produce a greater recovery on a present value basis than not taking such actions. If ; and
(iii) if the Master Servicer or the Special Servicer, as applicable, has so determined and has so certified to the Trustee, based on satisfaction of the criteria in clauses (i) and (ii) above above, that it would be in the best economic interest of the Owner Trust Fund to take any of the actions specified in clauses (i) or (ii) above, and if the cost of taking such actionsactions would be in excess of $100,000, the Master Servicer or has notified the Special ServicerTrustee, as applicablesetting forth in reasonable detail the reasons for its determination, which, in turn, shall notify the Owner Holders of the Class A, Class B, Class C and Class D Certificates of such proposed action. The Master , and the Trustee has received and delivered to the Servicer or written instructions from all of the Special Servicer, as applicable, shall Holders of such Certificates directing it to take such action only and the Trustee has not given the Servicer directions not to take such action based upon the Trustee's reasonable opinion that there would be a likelihood of its individual liability resulting from such action against which the Trustee would not receive indemnification hereunder, or, if authorized by indemnified, that there would not be sufficient assets available to fully pay the Owner in writingTrustee's damages, losses, costs and expenses. The costs cost of any such compliance, containment, clean-up or remediation may be withdrawn from the Distribution Account by the Servicer as an expense of the Trust Fund to the extent not otherwise provided for under the Loan Documents. The Servicer, consistent with Accepted Servicing Practices, shall pursue any remedies available under the Loan Documents and any recoveries in connection therewith shall be paid by deposited in the Master Distribution Account. The Servicer as a Servicing Expense in accordance with Sections 3.03 and 5.02. If the environmental assessment first obtained by the Master Servicer or the Special Servicer with respect shall have no obligation hereunder to a Mortgaged Property indicates that expend any of its own funds to pursue any such Mortgaged Property may not be in compliance with applicable Environmental Laws but does not definitively establish such fact, the Master Servicer or the Special Servicer, subject to the Owner’s prior written consent, shall cause such further environmental assessments to be conductedremedies.
(df) The environmental site assessments contemplated by Section 3.09(c3.7(e) hereof shall be prepared by any Independent Person who is recommended regularly conducts environmental site assessments for purchasers of comparable properties and who has had not less than five years experience in such matters, as determined by the Master Servicer or the Special Servicer and approved in writing by the Owner or such other Person as directed in writing by the Owner, which Person shall be a qualified independent person (the precise scope and timing to be mutually agreed upon by the Owner and the Master Servicer or the Special Servicer). The report of the environmental assessment shall be delivered to the Owner, manner consistent with a copy to the Master Servicer or the Special Servicer, and shall include an estimate of the cost to investigate and remediate the Mortgage Property and environmental hazard, or to otherwise address any noncompliance with applicable Environmental Laws or health and safety law and regulations or environmental condition (such as the presence of asbestos-containing materials). The Master Servicer, the Special Servicer or its agent shall provide a separate recommendation to the Owner as to whether it is advisable for the Owner or any REO Subsidiary to take title or otherwise become in possession of, assume the operation of (including appointment of a receiver) or take any other action with respect to the Mortgaged Property given the conclusions and information set forth in such environmental assessment report taking into account unique property features or characteristics. Such recommendations should identify the factual and legal basis for the recommendations and the applicable provisions of the Environmental Laws, the health and safety laws and regulations and other authorities relevant thereto, including a description of any reasonable steps required to avoid or minimize the potential of environmental liability regarding the environmental conditions on the Mortgaged Property in the event the Owner comes into possession, ownership or operation of the Mortgaged PropertyAccepted Servicing Practices. The cost of preparation of any environmental assessment shall be paid reasonable for such reports and shall be advanced by the Master Servicer as an expense of the Trust Fund, unless the Servicer determines that such Advance would be a Nonrecoverable Advance and the Servicer shall be reimbursed therefor as a Servicing Expense in accordance with Sections 3.03 and 5.02. Advance pursuant to Section 3.3(e)(iv) hereof.
(g) If the Master Servicer or the Special Servicer determines, pursuant to Section 3.09(c)3.7(e) hereof, that taking such actions as are necessary to bring any Mortgaged Property with respect to which foreclosure is contemplated into compliance with applicable Environmental Laws, or taking such actions with respect to the containment, clean-up, removal or remediation of hazardous substances, hazardous materials, hazardous wastes, or petroleum-based materials affecting any such Mortgaged Property, is not reasonably likely to produce a greater recovery on a present value basis than not taking such actions, and the Servicer has not received contrary directions from Certificateholders or the Trustee as set forth in Section 3.7(e)(iii) directing the Servicer not to take such actions, then the Master Servicer or the Special Servicer shall take such action actions consistent with Accepted Servicing Practices as directed it deems to be in writing by the Ownerbest economic interests of the Trust Fund, including, including without limitation, limitation releasing the lien of the related Mortgage with respect to the affected Mortgaged PropertyProperty if it shall have either (i) obtained a Nondisqualification Opinion or (ii) if such opinion cannot be obtained, the consent from all of the Holders of Class A, Class B, Class C and Class D Certificates (in connection with which the Trustee shall forward to such Certificateholders written notice from the Servicer that the Nondisqualification Opinion could not be obtained). Any expenditure made by the Servicer pursuant to this paragraph (g) shall constitute a Servicing Advance. Neither the Trustee nor the Servicer shall be obligated to take any action or not take any action pursuant to this paragraph (g) at the direction of such Certificateholders unless such Certificateholders agree to indemnify the Trustee or the Servicer, as the case may be, with respect to such action or inaction.
Appears in 1 contract
Samples: Trust and Servicing Agreement (Kranzco Realty Trust)
Realization Upon Mortgaged Properties. (a) Upon the failure of any Borrower Subject to make any required payment of principal, interest or other amounts due under a Mortgage Loan, or otherwise to perform fully any material obligations under any of the related Mortgage Loan Documents, in either case within any applicable grace periodSection 3.14(b), the Master Servicer shall, upon discovery of such failure, promptly notify the Owner in writing. As directed in writing by the Owner in each instance, the Master Servicer or the Special Servicer shall issue notices of default, declare events of default, declare due the entire outstanding principal balance, and otherwise take all reasonable actions under the related Mortgage Loan in preparation for the Owner to realize upon the underlying collateral, including the Mortgage Property and the Additional Collateral. With respect to any Specially Serviced Mortgage Loan, the Special Servicer shall, as permitted under consistent with the provisions of the related Mortgage Loan Documentsand this Agreement, and subject to the Owner’s 's prior written consentinstruction, foreclose upon or otherwise comparably convert provide Ordinary Foreclosure Services with respect to any Mortgage Loan that is in default. Any such Ordinary Foreclosure Services may at the ownership option of the related Mortgaged PropertyOwner be effected in either the name of the Owner or the name of the Owner's designee; and in the event that the Owner directs the Servicer to take such actions in the name of its designee all references in this Section 3.13 to the Owner shall be deemed to include the Owner's designee. In connection with such foreclosure or other conversionOrdinary Foreclosure Services, the Special Servicer shall, subject to the consent or direction of the Owner, shall follow such practices and procedures as it shall deem necessary or advisable and as shall be consistent with Accepted Servicing Practices; provided, however, that the Servicer shall keep the Owner apprised of the progress of any such proceeding, and shall not take any material action therein without the Owner's prior written consent. All costs and expenses incurred by the Special Servicer in any such proceedings shall be paid by the Master Servicer as a Servicing Expense in accordance with Sections 3.03 and 5.02Advance. Master The Servicer or shall notify the Special Servicer, as applicable, shall consult with Owner regarding the selection and retention of legal counsel.
(b) If immediately when title to any Mortgaged Property is acquired in foreclosure or by deed in lieu of foreclosure, the deed or certificate of sale shall be taken in the name of the Owner or its nominee, but in no event shall such deed or certificate be taken in the name of the Master Servicer or the Special Servicer. Notwithstanding any such acquisition of title and cancellation of the related Mortgage Loan, such Mortgage Loan shall be considered to be an REO Mortgage Loan held acquired.
(b) Unless otherwise expressly directed by the Owner until such time as in accordance with clause (ii) of Section 3.13(d), the related REO Property Servicer shall be sold, transferred not foreclose on (or conveyed comparably convert to ownership by the Owner. Consistent with the foregoing, for purposes of all calculations hereunder, so long as such REO Mortgage Loan shall be considered to be an outstanding Mortgage Loan, payments and collections with respect to the related REO Property received in any month (net of related expenses) shall be applied to amounts which would have been payable under the related Note in accordance with the terms of such Note.
(c) Except as otherwise provided in written instructions delivered to the Master Servicer or the Special Servicer by the Owner, the Master Servicer or the Special Servicer shall not obtain title to any a Mortgaged Property as a result or in lieu of foreclosure or otherwise, and shall not otherwise acquire possession of, or take other action with respect to, any Mortgaged Property, if, as a result of any such action, the Owner would be considered to hold title to, to be a “"mortgagee-in-possession” " of, or to be an “"owner” " or “"operator” " of such Mortgaged Property within the meaning of the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended from time to time, or any applicable comparable federal, state or local law (collectively, "Environmental LawLaws"), or a “"discharger” " or “"responsible ------------------ party” " thereunder, unless the Master Servicer or the Special Servicer has also previously determinedunless, based on a report an environmental site assessment, such environmental site assessment delivered in its final form and being expressly acceptable to the Owner, prepared by a Person who regularly conducts environmental site assessments, that:
(i) such Mortgaged Property is in compliance with applicable Environmental Laws or, if not, that taking such actions as are necessary to bring such Mortgaged Property into compliance therewith is reasonably likely to produce a greater recovery on a present value basis than not taking such actionsLaws; and
(ii) there are no circumstances present on such Mortgaged Property relating to the use, management or disposal of any hazardous substances, hazardous materials, hazardous wastes, or petroleum-based materials for which investigation, testing, monitoring, containment, clean-up or remediation could be required under any applicable Environmental Lawfederal, state or that, if any such hazardous materials are present for which such action could be required, taking such actions with respect to the affected Mortgaged Property is reasonably likely to produce a greater recovery on a present value basis than not taking such actions. If the Master Servicer local law or the Special Servicer, as applicable, has so determined based on satisfaction of the criteria in clauses (i) and (ii) above that it would be in the best economic interest of the Owner to take any such actions, the Master Servicer or the Special Servicer, as applicable, shall notify the Owner of such proposed action. The Master Servicer or the Special Servicer, as applicable, shall take such action only if authorized by the Owner in writing. The costs of any such compliance, containment, clean-up or remediation shall be paid by the Master Servicer as a Servicing Expense in accordance with Sections 3.03 and 5.02regulation. If the environmental assessment first obtained by the Master Servicer or the Special Servicer with respect to a Mortgaged Property indicates that such Mortgaged Property may not be in compliance with applicable Environmental Laws or that hazardous materials, hazardous substances, hazardous wastes or petroleum-based materials may be present but does not definitively establish such fact, the Master Servicer or the Special Servicer, subject to with the Owner’s 's prior written consent, consent shall cause such further environmental assessments tests to be conductedconducted by an independent Person who regularly conducts such tests as the Servicer shall deem prudent to protect the interests of the Owner. Any such tests shall be deemed part of the environmental assessments obtained by the Servicer for purposes of this Section.
(dc) The environmental site assessments contemplated by Section 3.09(c3.13(b) shall be obtained by the Servicer and prepared by any Person who is recommended by the Master Servicer or the Special Servicer and approved in writing by the Owner or such other Person and who regularly conducts environmental site assessments for purchasers of comparable properties, as directed in writing determined by the Owner, which Person shall be Servicer in a qualified independent person (the precise scope and timing to be mutually agreed upon by the Owner and the Master Servicer or the Special Servicer). The report of the environmental assessment shall be delivered to the Owner, manner consistent with a copy to the Master Servicer or the Special Servicer, and shall include an estimate of the cost to investigate and remediate the Mortgage Property and environmental hazard, or to otherwise address any noncompliance with applicable Environmental Laws or health and safety law and regulations or environmental condition (such as the presence of asbestos-containing materials). The Master Servicer, the Special Servicer or its agent shall provide a separate recommendation to the Owner as to whether it is advisable for the Owner or any REO Subsidiary to take title or otherwise become in possession of, assume the operation of (including appointment of a receiver) or take any other action with respect to the Mortgaged Property given the conclusions and information set forth in such environmental assessment report taking into account unique property features or characteristics. Such recommendations should identify the factual and legal basis for the recommendations and the applicable provisions of the Environmental Laws, the health and safety laws and regulations and other authorities relevant thereto, including a description of any reasonable steps required to avoid or minimize the potential of environmental liability regarding the environmental conditions on the Mortgaged Property in the event the Owner comes into possession, ownership or operation of the Mortgaged PropertyAccepted Servicing Practices. The cost of preparation of any environmental assessment shall be paid by the Master Owner. At the option of the Owner, the Owner may retain the Servicer to determine, based on such environmental site assessments, whether the conditions in clauses (i) and (ii) of Section 3.13(b) have been satisfied; provided that the Servicer shall have the right to retain a consultant that is acceptable (both as a Servicing Expense to professional qualifications and as to fees) to both the Owner and the Servicer to make such determination, in accordance with Sections 3.03 which event the Owner shall pay the fees of such consultant.
(d) In the event that the conditions set forth in clauses (i) and 5.02. If (ii) of Section 3.13(b) cannot be satisfied, then at the Master Servicer or Owner's option either (i) the Special Servicer determines, pursuant to Owner may transfer the servicing of the applicable Mortgage Loan as provided in Section 3.09(c3.14(b), that taking or (ii) the Servicer shall provide such actions as are necessary to bring any Mortgaged Property into compliance with applicable Environmental Laws, or taking such actions services with respect to such Mortgage Loan as the containmentOwner shall direct, clean-up, removal or remediation of hazardous substances, hazardous materials, hazardous wastes, or petroleum-based materials affecting any such Mortgaged Property, is not reasonably likely subject to produce a greater recovery on a present value basis than not taking such actions, then the Master Servicer or the Special Servicer shall take such action as directed in writing by the Owner, including, without limitation, releasing the lien prior agreement of the related Mortgage with respect Owner and Servicer as to the affected Mortgaged Propertyterms of provision of, including compensation for, such services.
Appears in 1 contract
Samples: Servicing Agreement (Imperial Credit Commercial Mortgage Investment Corp)
Realization Upon Mortgaged Properties. (a) Upon the failure of any Borrower to make any required payment of principal, interest or other amounts due under a Mortgage Loan, or otherwise to perform fully any material obligations under any of the related Mortgage Loan Documents, in either case within any applicable grace period, the Master Servicer shall, upon discovery of such failure, promptly notify the Owner in writing. As directed in writing by the Owner in each instance, the Master Servicer or the Special Servicer shall issue notices of default, declare events of default, declare due the entire outstanding principal balance, and otherwise take all reasonable actions under the related Mortgage Loan in preparation for the Owner to realize upon the underlying collateral, including the Mortgage Property and the Additional Collateral. With respect to any Specially Serviced Mortgage Loan, the Special Servicer shall, as permitted under the provisions of the related Mortgage Loan Documents, and subject to the Owner’s prior written consent, foreclose upon or otherwise comparably convert the ownership of the related Mortgaged Property. In connection with such foreclosure or other conversion, the Special Servicer shall, subject to the consent or direction of the Owner, follow such practices and procedures as it shall deem necessary or advisable and as shall be consistent with Accepted Servicing Practices. All costs and expenses incurred by the Special Servicer in any such proceedings shall be paid by the Master Servicer as a Servicing Expense in accordance with Sections 3.03 and 5.02. Master Servicer or the Special Servicer, as applicable, shall consult with Owner regarding the selection and retention of legal counsel.
(b) If title to any Mortgaged Property is acquired in foreclosure or by deed in lieu of foreclosure, the deed or certificate of sale shall be taken in the name of the Owner or its nominee, but in no event shall such deed or certificate be taken in the name of the Master Servicer or the Special Servicer. Notwithstanding any such acquisition of title and cancellation of the related Mortgage Loan, such Mortgage Loan shall be considered to be an REO Mortgage Loan held by the Owner until such time as the related REO Property shall be sold, transferred or conveyed by the Owner. Consistent with the foregoing, for purposes of all calculations hereunder, so long as such REO Mortgage Loan shall be considered to be an outstanding Mortgage Loan, payments and collections with respect to the related REO Property received in any month (net of related expenses) shall be applied to amounts which would have been payable under the related Note in accordance with the terms of such Note.
(c) Except as otherwise provided in written instructions delivered to the Master Servicer or the Special Servicer by the Owner, the Master Servicer or the Special Servicer shall not obtain title to any Mortgaged Property as a result or in lieu of foreclosure or otherwise, and shall not otherwise acquire possession of, or take other action with respect to, any Mortgaged Property, if, as a result of any such action, the Owner would be considered to hold title to, to be a “mortgagee-in-possession” of, or to be an “owner” or “operator” of such Mortgaged Property within the meaning of any Environmental Law, or a “discharger” or “responsible party” thereunder, unless the Master Servicer or the Special Servicer has also previously determined, based on a report prepared by a Person who regularly conducts environmental site assessments, that:
(i) such Mortgaged Property is in compliance with applicable Environmental Laws or, if not, that taking such actions as are necessary to bring such Mortgaged Property into compliance therewith is reasonably likely to produce a greater recovery on a present value basis than not taking such actions; and
(ii) there are no circumstances present on such Mortgaged Property relating to the use, management or disposal of any hazardous materials for which investigation, testing, monitoring, containment, clean-up or remediation could be required under any applicable Environmental Law, or that, if any such hazardous materials are present for which such action could be required, taking such actions with respect to the affected Mortgaged Property is reasonably likely to produce a greater recovery on a present value basis than not taking such actions. If the Master Servicer or the Special Servicer, as applicable, has so determined based on satisfaction of the criteria in clauses (i) and (ii) above that it would be in the best economic interest of the Owner to take any such actions, the Master Servicer or the Special Servicer, as applicable, shall notify the Owner of such proposed action. The Master Servicer or the Special Servicer, as applicable, shall take such action only if authorized by the Owner in writing. The costs of any such compliance, containment, clean-up or remediation shall be paid by the Master Servicer as a Servicing Expense in accordance with Sections 3.03 and 5.02. If the environmental assessment first obtained by the Master Servicer or the Special Servicer with respect to a Mortgaged Property indicates that such Mortgaged Property may not be in compliance with applicable Environmental Laws but does not definitively establish such fact, the Master Servicer or the Special Servicer, subject to the Owner’s prior written consent, shall cause such further environmental assessments to be conducted.
(d) The environmental site assessments contemplated by Section 3.09(c) shall be prepared by any Person who is recommended by the Master Servicer or the Special Servicer and approved in writing by the Owner or such other Person as directed in writing by the Owner, which Person shall be a qualified independent person (the precise scope and timing to be mutually agreed upon by the Owner and the Master Servicer or the Special Servicer). The report of the environmental assessment shall be delivered to the Owner, with a copy to the Master Servicer or the Special Servicer, and shall include an estimate of the cost to investigate and remediate the Mortgage Property and environmental hazard, or to otherwise address any noncompliance with applicable Environmental Laws or health and safety law and regulations or environmental condition (such as the presence of asbestos-containing materials). The Master Servicer, the Special Servicer or its agent shall provide a separate recommendation to the Owner as to whether it is advisable for the Owner or any REO Subsidiary to take title or otherwise become in possession of, assume the operation of (including appointment of a receiver) or take any other action with respect to the Mortgaged Property given the conclusions and information set forth in such environmental assessment report taking into account unique property features or characteristics. Such recommendations should identify the factual and legal basis for the recommendations and the applicable provisions of the Environmental Laws, the health and safety laws and regulations and other authorities relevant thereto, including a description of any reasonable steps required to avoid or minimize the potential of environmental liability regarding the environmental conditions on the Mortgaged Property in the event the Owner comes into possession, ownership or operation of the Mortgaged Property. The cost of preparation of any environmental assessment shall be paid by the Master Servicer as a Servicing Expense in accordance with Sections 3.03 and 5.02. If the Master Servicer or the Special Servicer determines, pursuant to Section 3.09(c), that taking such actions as are necessary to bring any Mortgaged Property into compliance with applicable Environmental Laws, or taking such actions with respect to the containment, clean-up, removal or remediation of hazardous substances, hazardous materials, hazardous wastes, or petroleum-based materials affecting any such Mortgaged Property, is not reasonably likely to produce a greater recovery on a present value basis than not taking such actions, then the Master Servicer or the Special Servicer shall take such action as directed in writing by the Owner, including, without limitation, releasing the lien of the related Mortgage with respect to the affected Mortgaged Property.
Appears in 1 contract
Samples: Servicing Agreement (PennyMac Mortgage Investment Trust)
