Released Mortgage Loans and Released Mortgaged Properties. (a) The applicable Issuers may obtain the release (the “Release”) of Mortgage Loans or Mortgaged Properties (any such Mortgage Loan or Mortgaged Property, a “Released Mortgage Loan” or “Released Mortgaged Property” as applicable) in connection with (i) the exercise of a Third Party Purchase Option, (ii) the purchase or substitution of a Delinquent Asset or Defaulted Asset by the Special Servicer or the Property Manager or any assignee thereof, (iii) the repurchase or substitution of a Mortgage Loan or Mortgaged Property by the related Originator or Support Provider due to a Collateral Defect, (iv) the sale of a Mortgage Loan or Mortgaged Property to a third party or to a Spirit SPE or (v) the exchange of a Mortgage Loan or Mortgaged Property with a third party, the Support Provider or a Spirit SPE; provided, however, that in no event shall the applicable Issuer obtain any such release unless, after giving effect to any such Release and any resulting changes to the Collateral Pool, the Indenture Trustee shall have received an Opinion of Counsel to the effect that, for U.S. federal income tax purposes, no tax gain or loss will be recognized by any Noteholder or any Issuer with respect to any outstanding Series solely as a result of such Release and the resulting changes in the Collateral Pool (the “Tax Required Condition”). In addition, without the consent of the Series 2005-1 Insurer and at least 20 days’ prior written notice to the Rating Agencies, no Mortgage Loan or Mortgaged Property shall constitute a Qualified Substitute Mortgage Loan or Qualified Substitute Mortgaged Property, as applicable, unless, after giving effect to the transfer of such Mortgage Loan or Mortgaged Property to the applicable Issuer in exchange for a Released Mortgage Loan or Released Mortgaged Property, as applicable, either (i) no Property Concentration shall exceed the applicable Maximum Property Concentration, or (ii) if any Property Concentration on the date of such substitution exceeds the related Maximum Property Concentration, such Property Concentration shall be reduced or remain unchanged after giving effect to such substitution. (b) Except in connection with the release of a Mortgage Loan or a Mortgaged Property in exchange for a Qualified Substitute Mortgage Loan or a Qualified Substitute Mortgaged Property, the applicable Issuer will be required to obtain the applicable Release Price in order to obtain the Release of a Mortgage Loan or Mortgaged Property. The “Release Price” for any Mortgage Loan or Mortgaged Property will be an amount equal to (i) the Third Party Option Price if the release occurs in connection with any Third Party Purchase Option, (ii) the Fair Market Value with respect to any Delinquent Asset or Defaulted Asset purchased by the Special Servicer or the Property Manager or any assignee thereof (provided, that the Fair Market Value is equal to or greater than the Allocated Collateral Amount thereof), (iii) the Payoff Amount with respect to any Mortgage Loan or Mortgaged Property repurchased by the related Originator or the Support Provider due to a Collateral Defect, (iv) the greater of (A) the Fair Market Value and (B) the sum of 125% of the Allocated Collateral Amount plus unreimbursed Property Protection Advances (plus Advance Interest thereon) and Emergency Property Expenses for any Mortgage Loan or Mortgaged Property sold to a third party or a Spirit SPE or (v) the Fair Market Value of any Mortgage Loan or Mortgaged Property, as applicable, if the Property Manager or the Special Servicer deems the release and sale of such Mortgage Loan or Mortgaged Property to be in the best interest of the Noteholders and the Series 2005-1 Insurer gives its prior written consent (such consent not to be unreasonably withheld) to the release and sale of such Mortgage Loan or Mortgaged Property. In determining the Fair Market Value, the Property Manager or the Special Servicer, as applicable, shall establish a price determined to be the most probable price which such Mortgage Loan or Mortgaged Property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. In making any such determination, the Property Manager or Special Servicer may obtain an MAI appraisal of the related Mortgaged Property and shall assume the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: (i) buyer and seller are typically motivated; (ii) both parties are well informed or well advised, and acting in what they consider their best interests; (iii) a reasonable time is allowed for exposure in the open market; (iv) payment is made in terms of cash in United States dollars or in terms of financial arrangements comparable thereto; and (v) the price represents the normal consideration for such Mortgage Loan or Mortgaged Property unaffected by special or creative financing or sales concessions granted by anyone associated with the sale. The Property Manager or Special Servicer shall take into account, among other factors, the period and amount of the delinquency on such Mortgage Loan or Lease, the occupancy level and physical condition of the related Mortgaged Property, the state of the local economy in the area where the Mortgaged Property is located, and the time and expense associated with a purchaser foreclosing on the related Mortgaged Property. In addition, the Property Manager or the Special Servicer, as applicable, shall refer to all other relevant information obtained by it or otherwise contained in the Servicing File, taking into account any change in circumstances regarding the related Mortgaged Property known to the Property Manager or the Special Servicer, as applicable, that would materially affect the value of the related Mortgaged Property reflected in the most recent appraisal. Furthermore, the Property Manager or the Special Servicer, as applicable, may consider objective third party information obtained from generally available sources, as well as information obtained from vendors providing real estate services to the Property Manager or the Special Servicer, as applicable, concerning the market for distressed real estate loans and the real estate market for the subject property type in the area where the related Mortgaged Property is located. The Property Manager or the Special Servicer, as applicable, may also conclusively rely on any opinions or reports of qualified independent experts in real estate or commercial mortgage loan matters. All reasonable out-of-pocket costs and expenses incurred by the Property Manager or the Special Servicer, as applicable, pursuant to making a determination of Fair Market Value shall constitute, and be reimbursable as, Property Protection Advances.
Appears in 2 contracts
Samples: Property Management and Servicing Agreement (Spirit Finance Corp), Property Management and Servicing Agreement (Spirit Finance Corp)
Released Mortgage Loans and Released Mortgaged Properties. (a) The applicable Issuers may obtain the release (the “Release”) of Mortgage Loans or Mortgaged Properties (any such Mortgage Loan or Mortgaged Property, a “Released Mortgage Loan” or “Released Mortgaged Property” as applicable) from the lien of the Indenture in connection with (i) the exercise of a Third Party Purchase Option, (ii) the purchase or substitution of a Delinquent Asset or Defaulted Asset by the Special Servicer or the Property Manager or any assignee thereof, (iii) the repurchase or substitution of a Mortgage Loan or Mortgaged Property by the related Originator or Support Provider an applicable Cure Party due to a Collateral Defect, (iv) the sale of a Mortgage Loan or Mortgaged Property to the Support Provider, a third party unaffiliated with Spirit Realty or to a Spirit SPE or (v) the exchange of a Mortgage Loan or Mortgaged Property with the Support Provider, a third partyparty unaffiliated with Spirit Realty, the Support Provider or a Spirit SPE; provided, however, that in no event shall the applicable Issuer obtain any such release unless, after giving effect to any such Release and any resulting changes to the Collateral Pool, the Indenture Trustee shall have received an Opinion of Counsel to the effect that, for U.S. federal income tax purposes, no tax gain or loss will be recognized by any Noteholder or any Issuer with respect to any outstanding Series solely as a result of such Release and the resulting changes in the Collateral Pool (the “Tax Required Condition”). In addition, without connection with the consent Release of the Series 2005-1 Insurer and at least 20 days’ prior written notice to the Rating Agencies, no Mortgage Loan or Mortgaged Property shall constitute a Qualified Substitute Mortgage Loan or Qualified Substitute Mortgaged Property, as applicable, unless, after giving effect to the transfer of such Mortgage Loan or Mortgaged Property to the applicable Issuer in exchange for a Released Mortgage Loan or (i) any Released Mortgaged Property, as applicable, either (i) no Property Concentration the related Lease and the related Lease File shall exceed be simultaneously released from the applicable Maximum Property Concentration, lien of the Indenture or (ii) if any Property Concentration on the date of such substitution exceeds Released Mortgage Loan, the related Maximum Property Concentration, such Property Concentration Loan File shall be reduced or remain unchanged after giving effect simultaneously released from the lien of the Indenture. The applicable Issuers shall obtain any Release that it is required to such substitutionobtain in accordance with the terms hereof.
(b) Except in connection with the release of a Mortgage Loan or a Mortgaged Property in exchange for a one or more Qualified Substitute Mortgage Loan Loans or a one or more Qualified Substitute Mortgaged PropertyProperties, the applicable Issuer will be required to obtain the applicable Release Price in order to obtain the Release of a Mortgage Loan or Mortgaged Property. The “Release Price” for any Mortgage Loan or Mortgaged Property will be an amount equal to (i) the Third Party Option Price if the release occurs in connection with any Third Party Purchase Option, (ii) the Fair Market Value with respect to any Delinquent Asset or Defaulted Asset purchased by the Special Servicer or the Property Manager or any assignee thereof the greater of (provided, that A) the Fair Market Value is equal to or greater than thereof and (B) the Allocated Loan Amount thereof as of the First Collateral Amount thereof)Date with respect thereto, (iii) the Payoff Amount with respect to any Mortgage Loan or Mortgaged Property repurchased by the related Originator or the Support Provider due to a Collateral Defect, (iv) the greater of (A) the Fair Market Value and (B) the sum of 125% of the Allocated Loan Amount thereof as of the First Collateral Amount Date with respect thereto plus unreimbursed Property Protection Advances (plus Advance Interest thereon) and ), Emergency Property Expenses Expenses, Extraordinary Expenses, Special Servicing Fees, Liquidation Fees and Workout Fees for any Mortgage Loan or Mortgaged Property sold to the Support Provider, to a third party unaffiliated with Spirit Realty or to a Spirit SPE or (v) the Fair Market Value of any Mortgage Loan or Mortgaged Property, as applicable, in each case if (X) the Property Manager or the Special Servicer deems the release and sale of such Mortgage Loan or Mortgaged Property to be in the best interest of the Noteholders and (Y) the Rating Condition is satisfied; provided, that after giving effect to such sale, the aggregate Collateral Value of all Mortgaged Properties (determined as of the First Collateral Date with respect to such Mortgaged Properties) and Mortgage Loans (determined as of the release date with respect to each such Released Mortgage Loan) owned by the Issuer that have been sold to affiliates of the Issuers pursuant to this clause (v) would not exceed, (a) in any twelve month period, 15.0% of the Aggregate Collateral Value as of the most recent Series Closing Date or (b) 35.0% of the Aggregate Collateral Value (determined as of the applicable Starting Closing Date) during the Series 2005-1 Insurer gives its prior written consent Closing Period in which such sale occurs; provided, further, that the Issuers shall only be permitted to sell such Mortgaged Properties and Mortgage Loans pursuant to this clause (such consent not to be unreasonably withheldv) to its affiliates in the release event that the Property Manager or the Special Servicer determines that such sale is reasonably necessary in order to manage the Cashflow Coverage Ratios or compliance with the Maximum Asset Concentrations. In addition, the Issuers shall not acquire any Mortgaged Property or Mortgage Loan pursuant to this Section 7.01 in the event that, after giving effect to such acquisition, any Property Concentration would exceed the Maximum Asset Concentrations set forth in the Indenture or any Series Supplement and sale in effect at the time of such Mortgage Loan or Mortgaged Propertyacquisition. In determining the Fair Market ValueValue with respect to any Mortgaged Property or Mortgage Loan, the Property Manager or the Special Servicer, as applicable, shall establish a price determined to be the most probable price which such Mortgage Loan or Mortgaged Property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. In making any such determination, the Property Manager or Special Servicer Servicer, as applicable, (X) may obtain an MAI appraisal of the related Mortgaged Property; provided that in the case of a sale of a Mortgaged Property or Mortgage Loan to an affiliate of the Issuer pursuant to clause (v) of the definition of “Release Price”, the Property Manager or Special Servicer shall obtain such an appraisal and (Y) shall assume the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: (i) buyer and seller are typically motivated; (ii) both parties are well informed or well advised, and acting in what they consider their best interests; (iii) a reasonable time is allowed for exposure in the open market; (iv) payment is made in terms of cash in United States dollars or in terms of financial arrangements comparable thereto; and (v) the price represents the normal consideration for such Mortgage Loan or Mortgaged Property unaffected by special or creative financing or sales concessions granted by anyone associated with the sale. The In making any such determination, the Property Manager or Special Servicer shall take into account, among other factors, the period and amount of the delinquency on such Mortgage Loan or Lease, the occupancy level and physical condition of the related Mortgaged Property, the state of the local economy in the area where the Mortgaged Property is located, and the time and expense associated with a purchaser purchaser’s foreclosing on the related Mortgaged Property. In addition, the Property Manager or the Special Servicer, as applicable, shall refer to all other relevant information obtained by it or otherwise contained in the Servicing Filerelated servicing file, taking into account any change in circumstances regarding the related Mortgaged Property known to the Property Manager or the Special Servicer, as applicable, that would materially affect the value of the related Mortgaged Property reflected in the most recent related appraisal. Furthermore, the Property Manager or the Special Servicer, as applicable, may consider available objective third party information obtained from generally available sources, as well as information obtained from vendors providing real estate services to the Property Manager or the Special Servicer, as applicable, concerning the market for distressed real estate loans and the real estate market for the subject property type in the area where the related Mortgaged Property is located. The Property Manager or the Special Servicer, as applicable, may also conclusively rely on any opinions or reports of qualified independent experts in real estate or commercial mortgage loan matters. All reasonable out-of-pocket costs and expenses incurred by the Property Manager or the Special Servicer, as applicable, pursuant to making a determination of Fair Market Value shall constitute, and be reimbursable as, Property Protection Advances.
Appears in 1 contract
Samples: Property Management and Servicing Agreement (Spirit Realty Capital, Inc.)
Released Mortgage Loans and Released Mortgaged Properties. (a) The applicable Issuers may obtain the release (the “Release”) of Mortgage Loans or Mortgaged Properties (any such Mortgage Loan or Mortgaged Property, a “Released Mortgage Loan” or “Released Mortgaged Property” as applicable) from the lien of the Indenture in connection with (i) the exercise of a Third Party Purchase Option, (ii) the purchase or substitution of a Delinquent Asset or Defaulted Asset by the Special Servicer or the Property Manager or any assignee thereof, (iii) the repurchase or substitution of a Mortgage Loan or Mortgaged Property by the related Originator or Support Provider an applicable Cure Party due to a Collateral Defect, (iv) the sale of a Mortgage Loan or Mortgaged Property to the Support Provider, a or to a Support Provider SPE, Spirit Realty or to a third party unaffiliated with Spirit Realty or to a Spirit SPE or orthe Support Provider , (v) the exchange of a Mortgage Loan or Mortgaged Property with the Support Provider, a third partyparty unaffiliated with the Support Provider, a Support Provider SPE, Spirit Realty, Spirit SPE or a third-party unaffiliated with Spirit Realty or the Support Provider or a Spirit SPE; provided, however, that in no event shall the applicable Issuer obtain any such release unless, after giving effect to any such Release and any resulting changes to the Collateral Pool, the Indenture Trustee shall have received SPE(vi) an Opinion of Counsel to the effect that, for U.S. federal income tax purposes, no tax gain or loss will be recognized by any Noteholder or any Issuer with respect to any outstanding Series solely as a result of such Release and the resulting changes in the Collateral Pool (the “Tax Required Condition”)Early Refinancing Prepayment. In addition, without connection with the consent Release of the Series 2005-1 Insurer and at least 20 days’ prior written notice to the Rating Agencies, no Mortgage Loan or Mortgaged Property shall constitute a Qualified Substitute Mortgage Loan or Qualified Substitute Mortgaged Property, as applicable, unless, after giving effect to the transfer of such Mortgage Loan or Mortgaged Property to the applicable Issuer in exchange for a Released Mortgage Loan or (ix) any Released Mortgaged Property, as applicable, either (i) no Property Concentration the related Lease and the related Lease File shall exceed be simultaneously released from the applicable Maximum Property Concentration, lien of the Indenture or (iiiiy) if any Property Concentration on the date of such substitution exceeds Released Mortgage Loan, the related Maximum Property Concentration, such Property Concentration Loan File shall be reduced or remain unchanged after giving effect simultaneously released from the lien of the Indenture. The applicable Issuers shall obtain any Release that it is required to such substitutionobtain in accordance with the terms hereof.
(b) Except in connection with the release of a Mortgage Loan or a Mortgaged Property in exchange for a one or more Qualified Substitute Mortgage Loan Loans or a one or more Qualified Substitute Mortgaged PropertyProperties or a release in connection with an Early Refinancing Prepayment, the applicable Issuer will be required to obtain the applicable Release Price in order to obtain the Release of a Mortgage Loan or Mortgaged Property. The “Release Price” for any Mortgage Loan or Mortgaged Property will be an amount equal to (i) the Third Party Option Price if the release occurs in connection with any Third Party Purchase Option, (ii) the Fair Market Value with respect to any Delinquent Asset or Defaulted Asset purchased by the Special Servicer or the Property Manager or any assignee thereof the greater of (provided, that A) the Fair Market Value is equal to or greater than thereof and (B) the Allocated Loan Amount thereof as of the First Collateral Amount thereof)Date with respect thereto, (iii) the Payoff Amount with respect to any Mortgage Loan or Mortgaged Property repurchased by the related Originator or the Support Provider due to a Collateral Defect, (iv (or an equivalent amount recorded as a contribution in such calculations), (iv) with respect to any Terminated Lease Property, the Fair Market Value thereof, (v) the greater of (A) the Fair Market Value and (B) the sum of 125125115% of the Allocated Loan Amount thereof as of the First Collateral Amount Date with respect thereto plus unreimbursed Property Protection Advances (plus Advance Interest thereon) and ), Emergency Property Expenses Expenses, US-DOCS\96557504.296557504.7 Extraordinary Expenses, Special Servicing Fees, Liquidation Fees and Workout Fees for any Mortgage Loan or Mortgaged Property sold to the Support Provider, a third party or Support Provider SPE, Spirit Realty, a Spirit SPE or to a third party unaffiliated with Spirit Realty or to a Spirit SPEthe Support Provider or (vvvi) the Fair Market Value of any Mortgage Loan or Mortgaged Property, as applicableapplicablein each case, in each case if (X) the Property Manager or the Special Servicer deems the release and sale of such Mortgage Loan or Mortgaged Property pursuant to this clause (vi) to be in the best interest of the Noteholders and (Y) the Rating Agency Notification Condition is satisfied with respect to such release and sale; provided, that after giving effect to such sale, the aggregate Collateral Value of all Mortgaged Properties (determined as of the First Collateral Date with respect to such Mortgaged Properties) and Mortgage Loans (determined as of the release date with respect to each such Released Mortgage Loan) owned by the Issuer that have been sold to affiliates of the Issuersany Issuer or Spirit Realty pursuant to this clause (vvi) would not exceed, (a) in any twelve month period, 15.0% of the Aggregate Collateral Value as of the most recent Series Closing Date (which may be as of the date hereof) or (b) 35.0% of the Aggregate Collateral Value (determined as of the applicable Starting Closing Date) during the Series 2005-1 Insurer gives Closing Period in which such sale occurs; provided, further, that the Issuers shall only be permitted to sell such Mortgaged Properties and Mortgage Loans pursuant to this clause (vvi) to its prior written consent affiliates (or affiliates of Spirit Realty) in the event that the Property Manager or the Special Servicer determines that such consent sale is reasonably necessary in order to manage the Cashflow Coverage Ratios or compliance with the Maximum Asset Concentrations. In addition, the Issuers shall not acquire any Mortgaged Property or Mortgage Loan pursuant to this Section 7.01 in the event that, after giving effect to such acquisition, any Property Concentration would exceed the Maximum Asset Concentrations set forth in the Indenture or any Series Supplement and in effect at the time of such acquisition. Notwithstanding anything in the Transaction Documents to the contrary, no Release Price will be payable with respect to any Release Parcel transferred to a Tenant pursuant to an obligation under the related Lease in connection with a Specified Permitted Subdivision and, in such case, the Indenture Trustee will release such property from the Collateral Pool, subject only to receipt of an Officer’s Certificate from the Property Manager certifying that: (i) the Specified Permitted Subdivision will not result in a reduction of the Collateral Value of the original property that was subdivided in connection with such Specified Permitted Subdivision, (ii) the Specified Permitted Subdivision is in compliance in all material respects with all requirements of law, (iii) the Specified Permitted Subdivision will not impair or otherwise adversely affect the liens, security interests and other rights of the Issuers in the portion of the property not being released (the “Remaining Parcel”), (iv) the Remaining Parcel will comply with all requirements of law (including, without limitation, all zoning (including any parking requirements) and building codes) as well as the applicable requirements of the Lease, (v) the Remaining Parcel will constitute a separate and legal lot for subdivision, assessment and zoning purposes, (vi) the Remaining Parcel will either constitute a separate and legal lot for tax purposes or an application for a separate tax lot identification will have been submitted and an escrow account will have been established with sufficient funds on deposit to pay taxes on both the Release Parcel and the Remaining Parcel, (vii) the release of the Release Parcel will not materially adversely affect ingress or egress to or from the Remaining Parcel or access to utilities for the Remaining Parcel, (viii) the Release Parcel does not include any improvements that are subject to the related Lease, (ix) the documents with respect to the Specified Permitted Subdivision will not impose any new obligations upon, or otherwise further burden, the Remaining Parcel in any way other than customary reciprocal easements; and (x) the Property Manager or the Tenant has obtained or caused to be unreasonably withheld) obtained all necessary approvals, consents or permits with respect US-DOCS\96557504.296557504.7 92 to such Specified Permitted Subdivision (whether from applicable governmental or municipal authorities, parties to instruments of record affecting the release and sale of such Mortgage Loan property or Mortgaged Propertyotherwise). The certifications described in the preceding sentence are collectively referred to herein as the “Specified Permitted Subdivision Conditions.” Any costs or expenses incurred in connection with any Specified Permitted Subdivision will be paid by the Property Manager from its own funds. In determining the Fair Market ValueValue with respect to any Mortgaged Property or Mortgage Loan, the Property Manager or the Special Servicer, as applicable, shall establish a price determined to be the most probable price which such Mortgage Loan or Mortgaged Property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. In making any such determination, the Property Manager or Special Servicer Servicer, as applicable, (X) may obtain an MAI appraisal of the related Mortgaged Property; provided that in the case of a sale of a Mortgaged Property or Mortgage Loan to an affiliate of theany Issuer or Spirit Realty pursuant to clause (vvi) of the definition of “Release Price”, the Property Manager or Special Servicer shall obtain such an appraisal unless (x) an appraisal with respect to the related Mortgaged Property or property securing such Mortgage Loan has been delivered within twelve months prior to the sale of such Mortgaged Property or Mortgage Loan and (y) neither the Property Manager nor the Special Servicer reasonably believes that the value of such Mortgaged Property or property securing such Mortgage Loan has materially increased in value since the date of such appraisal and (Y) shall assume the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: (i) buyer and seller are typically motivated; (ii) both parties are well informed or well advised, and acting in what they consider their best interests; (iii) a reasonable time is allowed for exposure in the open market; (iv) payment is made in terms of cash in United States dollars or in terms of financial arrangements comparable thereto; and (v) the price represents the normal consideration for such Mortgage Loan or Mortgaged Property unaffected by special or creative financing or sales concessions granted by anyone associated with the sale. The In making any such determination, the Property Manager or Special Servicer shall take into account, among other factors, the period and amount of the delinquency on such Mortgage Loan or Lease, the occupancy level and physical condition of the related Mortgaged Property, the state of the local economy in the area where the Mortgaged Property is located, and the time and expense associated with a purchaser purchaser’s foreclosing on the related Mortgaged Property. In addition, the Property Manager or the Special Servicer, as applicable, shall refer to all other relevant information obtained by it or otherwise contained in the Servicing Filerelated servicing file, taking into account any change in circumstances regarding the related Mortgaged Property known to the Property Manager or the Special Servicer, as applicable, that would materially affect the value of the related Mortgaged Property reflected in the most recent related appraisal. Furthermore, the Property Manager or the Special Servicer, as applicable, may consider available objective third party information obtained from generally available sources, as well as information obtained from vendors providing real estate services to the Property Manager or the Special Servicer, as applicable, concerning the market for distressed real estate loans and the real estate market for the subject property type in the area where the related Mortgaged Property is located. The Property Manager or the Special Servicer, as applicable, may also conclusively rely on any opinions or reports of qualified independent experts in real estate or commercial mortgage loan matters. All reasonable out-of-pocket costs and expenses incurred by the Property Manager or the Special Servicer, as applicable, pursuant to making a determination of Fair Market Value shall constitute, and be reimbursable as, Property Protection Advances. US-DOCS\96557504.296557504.7
(c) Any (i) Release Price (plus sales proceeds in excess thereof (any such excess amount, a “Purchase Premium”)) received by the applicable Issuer in connection with the release of a Mortgage Loan or Mortgaged Property (other than during a Disposition Period) and (ii) any Balloon PaymentsPayment or Principal PrepaymentsPrepayment received in connection with a Mortgage Loan, in each case shall be deposited into the Release Account (or, during the continuance of an Early Amortization Event, the Collection Account or an Exchange Account pursuant to Section 7.01(d) below).
(d) For the avoidance of doubt, an Issuer may obtain the release of a Mortgage Loan or a Mortgaged Property in exchange for one or more Qualified Substitute Mortgage Loans or one or more Qualified Substitute Mortgaged Properties, as applicable, subject to the terms hereof.
(i) After giving effect to any sale or exchange of a Mortgage Loan or Mortgaged Property, the aggregate Collateral Value of all Released Mortgaged Properties (determined as of the First Collateral Date with respect to each such Released Mortgaged Property) and Released Mortgage Loans (determined as of the release date with respect to each such Released Mortgage Loan) sold or exchanged by any Issuer during the Closing Date Period in which such sale or exchange occurs shall not exceed 35.0% of the Aggregate Collateral Value (determined as of the applicable Starting Closing Date) unless the Rating Condition is satisfied; provided that releases and exchanges or substitutions in connection with Collateral Defects, sales pursuant to the exercise of Third Party Purchase Options, sales during the Disposition Period and, transfers or exchanges of Terminated Lease Properties, Risk-Based Substitutions and releases in connection with an Early Refinancing Prepayment shall not be subject to the foregoing limitation or taken into consideration in determining such aggregate Collateral Values of such Released Mortgaged Properties and Released Mortgage Loans..
(ii) If any of the following criteria are satisfied, the release of a Mortgaged Property in exchange for one or more Qualified Substitute Mortgaged Properties or, solely in the case of clause (d) below, the release of a Mortgage Loan in exchange for one or more Qualified Substitute Mortgage Loans or Qualified Substitute Mortgaged Properties will constitute a “Risk- BasedRisk-Based Substitution”: (a) the remaining term to maturity of the related Lease is less than three years from the date of the proposed substitution and the Property Manager, in accordance with the Servicing Standard, determines that there is a reasonable risk of non-renewal of such Lease; based on written communications from the Tenant under such Lease, the Property Manager, in accordance with the Servicing Standard, determines that there is a reasonable risk of nonrenewal of such Lease; (c) the Issuer has received from the Tenant under the related Lease written notice of the non-renewal of such Lease; or (d) the Property Manager, in accordance with the Servicing Standard, determines that there is a reasonable risk of monetary default by the Tenant under such Lease or the Borrower under such Mortgage Loan, as applicable, or such a default has occurred or such Lease or Mortgage Loan is or relates to a Defaulted Asset. US-DOCS\96557504.296557504.7
Appears in 1 contract
Released Mortgage Loans and Released Mortgaged Properties. (a) The applicable Issuers Issuer may obtain the release (the “Release”) of Mortgage Loans or Mortgaged Properties (any such Mortgage Loan or Mortgaged Property, a “Released Mortgage Loan” or “Released Mortgaged Property” as applicable) in connection with (i) the exercise of a Third Party Purchase Option, (ii) the purchase or substitution of a Delinquent Asset or Defaulted Asset by the Special Servicer or the Property Manager or any assignee thereof, (iii) the repurchase or substitution of a Mortgage Loan or Mortgaged Property by the related Originator or Support Provider due to a Collateral Defect, (iv) the sale of a Mortgage Loan or Mortgaged Property to a third party or to a Spirit SPE or (v) the exchange of a Mortgage Loan or Mortgaged Property with a third party, the Support Provider or a Spirit SPE; provided, however, that in no event shall the applicable Issuer obtain any such release unless, after giving effect to any such Release and any resulting changes to the Collateral Pool, the Indenture Trustee shall have received an Opinion of Counsel to the effect that, for U.S. federal income tax purposes, no tax gain or loss will be recognized by any Noteholder or any the Issuer with respect to any outstanding Series solely as a result of such Release and the resulting changes in the Collateral Pool (the “Tax Required Condition”). In addition, without the consent of the Series 2005-1 Insurer and at least 20 days’ prior written notice to the Rating Agencies, no Mortgage Loan or Mortgaged Property shall constitute a Qualified Substitute Mortgage Loan or Qualified Substitute Mortgaged Property, as applicable, unless, after giving effect to the transfer of such Mortgage Loan or Mortgaged Property to the applicable Issuer in exchange for a Released Mortgage Loan or Released Mortgaged Property, as applicable, either (i) no Property Concentration shall exceed the applicable Maximum Property Concentration, or (ii) if any Property Concentration on the date of such substitution exceeds the related Maximum Property Concentration, such Property Concentration shall be reduced or remain unchanged after giving effect to such substitution.
(b) Except in connection with the release of a Mortgage Loan or a Mortgaged Property in exchange for a Qualified Substitute Mortgage Loan or a Qualified Substitute Mortgaged Property, the applicable Issuer will be required to obtain the applicable Release Price in order to obtain the Release of a Mortgage Loan or Mortgaged Property. The “Release Price” for any Mortgage Loan or Mortgaged Property will be an amount equal to (i) the Third Party Option Purchase Price if the release occurs in connection with any Third Party Purchase Option, (ii) the greater of the Fair Market Value and the Allocated Collateral Amount with respect to any Delinquent Asset or Defaulted Asset purchased by the Special Servicer or the Property Manager or any assignee thereof (provided, that the Fair Market Value is equal to or greater than the Allocated Collateral Amount thereof), (iii) the Payoff Amount with respect to any Mortgage Loan or Mortgaged Property repurchased by the related Originator or the Support Provider due to a Collateral Defect, (iv) the greater of (A) the Fair Market Value and (B) the sum of 125% of the Allocated Collateral Amount plus unreimbursed Property Protection Advances (plus Advance Interest thereon) and Emergency Property Expenses for any Mortgage Loan or Mortgaged Property sold to a third party or a Spirit SPE or (v) the Fair Market Value of any Mortgage Loan or Mortgaged Property, as applicable, if the Property Manager or the Special Servicer deems the release and sale of such Mortgage Loan or Mortgaged Property to be in the best interest of the Noteholders and the Series 2005-1 Insurer gives its prior written consent (such consent not to be unreasonably withheld) to the release and sale of such Mortgage Loan or Mortgaged Property. In determining the Fair Market Value, the Property Manager or the Special Servicer, as applicable, shall establish a price determined to be the most probable price which such Mortgage Loan or Mortgaged Property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. In making any such determination, the Property Manager or Special Servicer may obtain an MAI appraisal of the related Mortgaged Property and shall assume the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: (i) buyer and seller are typically motivated; (ii) both parties are well informed or well advised, and acting in what they consider their best interests; (iii) a reasonable time is allowed for exposure in the open market; (iv) payment is made in terms of cash in United States dollars or in terms of financial arrangements comparable thereto; and (v) the price represents the normal consideration for such Mortgage Loan or Mortgaged Property unaffected by special or creative financing or sales concessions granted by anyone associated with the sale. The Property Manager or Special Servicer shall take into account, among other factors, the period and amount of the delinquency on such Mortgage Loan or Lease, the occupancy level and physical condition of the related Mortgaged Property, the state of the local economy in the area where the Mortgaged Property is located, and the time and expense associated with a purchaser foreclosing on the related Mortgaged Property. In addition, the Property Manager or the Special Servicer, as applicable, shall refer to all other relevant information obtained by it or otherwise contained in the Servicing File, File taking into account any change in circumstances regarding the related Mortgaged Property known to the Property Manager or the Special Servicer, as applicable, that would materially affect the value of the related Mortgaged Property reflected in the most recent appraisal. Furthermore, the Property Manager or the Special Servicer, as applicable, may consider objective third party information obtained from generally available sources, as well as information obtained from vendors providing real estate services to the Property Manager or the Special Servicer, as applicable, concerning the market for distressed real estate loans and the real estate market for the subject property type in the area where the related Mortgaged Property is located. The Property Manager or the Special Servicer, as applicable, may also conclusively rely on any opinions or reports of qualified independent experts in real estate or commercial mortgage loan matters. All reasonable out-of-pocket costs and expenses incurred by the Property Manager or the Special Servicer, as applicable, pursuant to making a determination of Fair Market Value shall constitute, and be reimbursable as, Property Protection Advances.
Appears in 1 contract
Samples: Property Management and Servicing Agreement (Spirit Finance Corp)
Released Mortgage Loans and Released Mortgaged Properties. (a) The applicable Issuers may obtain the release (the “Release”) of Mortgage Loans or Mortgaged Properties (any such Mortgage Loan or Mortgaged Property, a “Released Mortgage Loan” or “Released Mortgaged Property” as applicable) from the lien of the Indenture in connection with (i) the exercise of a Third Party Purchase Option, (ii) the purchase or substitution of a Delinquent Asset or Defaulted Asset by the Special Servicer or the Property Manager or any assignee thereof, (iii) the repurchase or substitution of a Mortgage Loan or Mortgaged Property by the related Originator or Support Provider an applicable Cure Party due to a Collateral Defect, (iv) the sale of a Mortgage Loan or Mortgaged Property to the Support Provider, a third party unaffiliated with Spirit Realty or to a Spirit SPE or (v) the exchange of a Mortgage Loan or Mortgaged Property with the Support Provider, a third partyparty unaffiliated with Spirit Realty, the Support Provider or a Spirit SPE; provided, however, that in no event shall the applicable Issuer obtain any such release be obtained unless, after giving effect to any such Release and any resulting changes to the Collateral Pool, the Indenture Trustee shall have received an Opinion of Counsel to the effect that, for U.S. federal income tax purposes, no tax gain or loss will be recognized by any Noteholder or any Issuer with respect to any outstanding Series solely as a result of such Release action and the resulting changes in the Collateral Pool (the “Tax Required Condition”). In addition, without connection with the consent Release of the Series 2005-1 Insurer and at least 20 days’ prior written notice to the Rating Agencies, no Mortgage Loan or Mortgaged Property shall constitute a Qualified Substitute Mortgage Loan or Qualified Substitute Mortgaged Property, as applicable, unless, after giving effect to the transfer of such Mortgage Loan or Mortgaged Property to the applicable Issuer in exchange for a Released Mortgage Loan or (i) any Released Mortgaged Property, as applicable, either (i) no Property Concentration the related Lease and the related Lease File shall exceed be simultaneously released from the applicable Maximum Property Concentration, lien of the Indenture or (ii) if any Property Concentration on the date of such substitution exceeds Released Mortgage Loan, the related Maximum Property Concentration, such Property Concentration Loan File shall be reduced or remain unchanged after giving effect simultaneously released from the lien of the Indenture. The applicable Issuers shall obtain any Release that it is required to such substitutionobtain in accordance with the terms hereof.
(b) Except in connection with the release of a Mortgage Loan or a Mortgaged Property in exchange for a one or more Qualified Substitute Mortgage Loan Loans or a one or more Qualified Substitute Mortgaged PropertyProperties, the applicable Issuer will be required to obtain the applicable Release Price in order to obtain the Release of a Mortgage Loan or Mortgaged Property. The “Release Price” for any Mortgage Loan or Mortgaged Property will be an amount equal to (i) the Third Party Option Price if the release occurs in connection with any Third Party Purchase Option, (ii) the Fair Market Value with respect to any Delinquent Asset or Defaulted Asset purchased by the Special Servicer or the Property Manager or any assignee thereof the greater of (provided, that A) the Fair Market Value is equal to or greater than thereof and (B) the Allocated Loan Amount thereof as of the First Collateral Amount thereof)Date with respect thereto, (iii) the Payoff Amount with respect to any Mortgage Loan or Mortgaged Property repurchased by the related Originator or the Support Provider due to a Collateral Defect, (iv) the greater of (A) the Fair Market Value and (B) the sum of 125% of the Allocated Loan Amount thereof as of the First Collateral Amount Date with respect thereto plus unreimbursed Property Protection Advances (plus Advance Interest thereon) and ), Emergency Property Expenses Expenses, Extraordinary Expenses, Special Servicing Fees, Liquidation Fees and Workout Fees for any Mortgage Loan or Mortgaged Property sold to the Support Provider, to a third party unaffiliated with Spirit Realty or to a Spirit SPE or (v) the Fair Market Value of any Mortgage Loan or Mortgaged Property, as applicable, in each case if (X) the Property Manager or the Special Servicer deems the release and sale of such Mortgage Loan or Mortgaged Property to be in the best interest of the Noteholders and (Y) the Rating Agency Notification Condition is satisfied with respect to such release and sale; provided, that after giving effect to such sale, the aggregate Collateral Value of all Mortgaged Properties (determined as of the First Collateral Date with respect to such Mortgaged Properties) and Mortgage Loans (determined as of the release date with respect to each such Released Mortgage Loan) owned by the Issuer that have been sold to affiliates of the Issuers pursuant to this clause (v) would not exceed, (a) in any twelve month period, 15.0% of the Aggregate Collateral Value as of the most recent Series Closing Date (which may be as of the date hereof) or (b) 35.0% of the Aggregate Collateral Value (determined as of the applicable Starting Closing Date) during the Series 2005-1 Insurer gives its prior written consent Closing Period in which such sale occurs; provided, further, that the Issuers shall only be permitted to sell such Mortgaged Properties and Mortgage Loans pursuant to this clause (such consent not to be unreasonably withheldv) to its affiliates in the release event that the Property Manager or the Special Servicer determines that such sale is reasonably necessary in order to manage the Cashflow Coverage Ratios or compliance with the Maximum Asset Concentrations. In addition, the Issuers shall not acquire any Mortgaged Property or Mortgage Loan pursuant to this Section 7.01 in the event that, after giving effect to such acquisition, any Property Concentration would exceed the Maximum Asset Concentrations set forth in the Indenture or any Series Supplement and sale in effect at the time of such Mortgage Loan or Mortgaged Propertyacquisition. In determining the Fair Market ValueValue with respect to any Mortgaged Property or Mortgage Loan, the Property Manager or the Special Servicer, as applicable, shall establish a price determined to be the most probable price which such Mortgage Loan or Mortgaged Property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. In making any such determination, the Property Manager or Special Servicer Servicer, as applicable, (X) may obtain an MAI appraisal of the related Mortgaged Property; provided that in the case of a sale of a Mortgaged Property or Mortgage Loan to an affiliate of the Issuer pursuant to clause (v) of the definition of “Release Price”, the Property Manager or Special Servicer shall obtain such an appraisal and (Y) shall assume the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: (i) buyer and seller are typically motivated; (ii) both parties are well informed or well advised, and acting in what they consider their best interests; (iii) a reasonable time is allowed for exposure in the open market; (iv) payment is made in terms of cash in United States dollars or in terms of financial arrangements comparable thereto; and (v) the price represents the normal consideration for such Mortgage Loan or Mortgaged Property unaffected by special or creative financing or sales concessions granted by anyone associated with the sale. The In making any such determination, the Property Manager or Special Servicer shall take into account, among other factors, the period and amount of the delinquency on such Mortgage Loan or Lease, the occupancy level and physical condition of the related Mortgaged Property, the state of the local economy in the area where the Mortgaged Property is located, and the time and expense associated with a purchaser purchaser’s foreclosing on the related Mortgaged Property. In addition, the Property Manager or the Special Servicer, as applicable, shall refer to all other relevant information obtained by it or otherwise contained in the Servicing Filerelated servicing file, taking into account any change in circumstances regarding the related Mortgaged Property known to the Property Manager or the Special Servicer, as applicable, that would materially affect the value of the related Mortgaged Property reflected in the most recent related appraisal. Furthermore, the Property Manager or the Special Servicer, as applicable, may consider available objective third party information obtained from generally available sources, as well as information obtained from vendors providing real estate services to the Property Manager or the Special Servicer, as applicable, concerning the market for distressed real estate loans and the real estate market for the subject property type in the area where the related Mortgaged Property is located. The Property Manager or the Special Servicer, as applicable, may also conclusively rely on any opinions or reports of qualified independent experts in real estate or commercial mortgage loan matters. All reasonable out-of-pocket costs and expenses incurred by the Property Manager or the Special Servicer, as applicable, pursuant to making a determination of Fair Market Value shall constitute, and be reimbursable as, Property Protection Advances.
Appears in 1 contract
Samples: Property Management and Servicing Agreement (Spirit Realty Capital, Inc.)
Released Mortgage Loans and Released Mortgaged Properties. (a) The applicable Issuers may obtain the release (the “Release”) of Mortgage Loans or Mortgaged Properties (any such Mortgage Loan or Mortgaged Property, a “Released Mortgage Loan” or “Released Mortgaged Property” as applicable) from the lien of the Indenture in connection with (i) the exercise of a Third Party Purchase Option, (ii) the purchase or substitution of a Delinquent Asset or Defaulted Asset by the Special Servicer or the Property Manager or any assignee thereof, (iii) the repurchase or substitution of a Mortgage Loan or Mortgaged Property by the related Originator or Support Provider an applicable Cure Party due to a Collateral Defect, (iv) the sale of a Mortgage Loan or Mortgaged Property to the Support Provider, a or to a Support Provider SPE, Spirit Realty or to a third party unaffiliated with Spirit Realty or to a Spirit SPE or orthe Support Provider , (v) the exchange of a Mortgage Loan or Mortgaged Property with the Support Provider, a third partyparty unaffiliated with the Support Provider, a Support Provider SPE, Spirit Realty, Spirit SPE or a third-party unaffiliated with Spirit Realty or the Support Provider or a Spirit SPE; provided, however, that in no event shall the applicable Issuer obtain any such release unless, after giving effect to any such Release and any resulting changes to the Collateral Pool, the Indenture Trustee shall have received SPE(vi) an Opinion of Counsel to the effect that, for U.S. federal income tax purposes, no tax gain or loss will be recognized by any Noteholder or any Issuer with respect to any outstanding Series solely as a result of such Release and the resulting changes in the Collateral Pool (the “Tax Required Condition”)Early Refinancing Prepayment. In addition, without connection with the consent Release of the Series 2005-1 Insurer and at least 20 days’ prior written notice to the Rating Agencies, no Mortgage Loan or Mortgaged Property shall constitute a Qualified Substitute Mortgage Loan or Qualified Substitute Mortgaged Property, as applicable, unless, after giving effect to the transfer of such Mortgage Loan or Mortgaged Property to the applicable Issuer in exchange for a Released Mortgage Loan or (ix) any Released Mortgaged Property, as applicable, either (i) no Property Concentration the related Lease and the related Lease File shall exceed be simultaneously released from the applicable Maximum Property Concentration, lien of the Indenture or (iiiiy) if any Property Concentration on the date of such substitution exceeds Released Mortgage Loan, the related Maximum Property Concentration, such Property Concentration Loan File shall be reduced or remain unchanged after giving effect simultaneously released from the lien of the Indenture. The applicable Issuers shall obtain any Release that it is required to such substitutionobtain in accordance with the terms hereof.
(b) Except in connection with the release of a Mortgage Loan or a Mortgaged Property in exchange for a one or more Qualified Substitute Mortgage Loan Loans or a one or more Qualified Substitute Mortgaged PropertyProperties or a release in connection with an Early Refinancing Prepayment, the applicable Issuer will be required to obtain the applicable Release Price in order to obtain the Release of a Mortgage Loan or Mortgaged Property. The “Release Price” for any Mortgage Loan or Mortgaged Property will be an amount equal to (i) the Third Party Option Price if the release occurs in connection with any Third Party Purchase Option, (ii) the Fair Market Value with respect to any Delinquent Asset or Defaulted Asset purchased by the Special Servicer or the Property Manager or any assignee thereof the greater of (provided, that A) the Fair Market Value is equal to or greater than thereof and (B) the Allocated Loan Amount thereof as of the First Collateral Amount thereof)Date with respect thereto, (iii) the Payoff Amount with respect to any Mortgage Loan or Mortgaged Property repurchased by the related Originator or the Support Provider due to a Collateral Defect, (iv (or an equivalent amount recorded as a contribution in such calculations), (iv) with respect to any Terminated Lease Property, the Fair Market Value thereof, (v) the greater of (A) the Fair Market Value and (B) the sum of 125125115% of the Allocated Loan Amount thereof as of the First Collateral Amount Date with respect thereto plus unreimbursed Property Protection Advances (plus Advance Interest thereon) and ), Emergency Property Expenses Expenses, US-DOCS\96557504.296557504.7 Extraordinary Expenses, Special Servicing Fees, Liquidation Fees and Workout Fees for any Mortgage Loan or Mortgaged Property sold to the Support Provider, a third party or Support Provider SPE, Spirit Realty, a Spirit SPE or to a third party unaffiliated with Spirit Realty or to a Spirit SPEthe Support Provider or (vvvi) the Fair Market Value of any Mortgage Loan or Mortgaged Property, as applicableapplicablein each case, in each case if (X) the Property Manager or the Special Servicer deems the release and sale of such Mortgage Loan or Mortgaged Property pursuant to this clause (vi) to be in the best interest of the Noteholders and (Y) the Rating Agency Notification Condition is satisfied with respect to such release and sale; provided, that after giving effect to such sale, the aggregate Collateral Value of all Mortgaged Properties (determined as of the First Collateral Date with respect to such Mortgaged Properties) and Mortgage Loans (determined as of the release date with respect to each such Released Mortgage Loan) owned by the Issuer that have been sold to affiliates of the Issuersany Issuer or Spirit Realty pursuant to this clause (vvi) would not exceed, (a) in any twelve month period, 15.0% of the Aggregate Collateral Value as of the most recent Series Closing Date (which may be as of the date hereof) or (b) 35.0% of the Aggregate Collateral Value (determined as of the applicable Starting Closing Date) during the Series 2005-1 Insurer gives Closing Period in which such sale occurs; provided, further, that the Issuers shall only be permitted to sell such Mortgaged Properties and Mortgage Loans pursuant to this clause (vvi) to its prior written consent affiliates (or affiliates of Spirit Realty) in the event that the Property Manager or the Special Servicer determines that such consent sale is reasonably necessary in order to manage the Cashflow Coverage Ratios or compliance with the Maximum Asset Concentrations. In addition, the Issuers shall not acquire any Mortgaged Property or Mortgage Loan pursuant to this Section 7.01 in the event that, after giving effect to such acquisition, any Property Concentration would exceed the Maximum Asset Concentrations set forth in the Indenture or any Series Supplement and in effect at the time of such acquisition. Notwithstanding anything in the Transaction Documents to the contrary, no Release Price will be payable with respect to any Release Parcel transferred to a Tenant pursuant to an obligation under the related Lease in connection with a Specified Permitted Subdivision and, in such case, the Indenture Trustee will release such property from the Collateral Pool, subject only to receipt of an Officer’s Certificate from the Property Manager certifying that: (i) the Specified Permitted Subdivision will not result in a reduction of the Collateral Value of the original property that was subdivided in connection with such Specified Permitted Subdivision, (ii) the Specified Permitted Subdivision is in compliance in all material respects with all requirements of law, (iii) the Specified Permitted Subdivision will not impair or otherwise adversely affect the liens, security interests and other rights of the Issuers in the portion of the property not being released (the “Remaining Parcel”), (iv) the Remaining Parcel will comply with all requirements of law (including, without limitation, all zoning (including any parking requirements) and building codes) as well as the applicable requirements of the Lease, (v) the Remaining Parcel will constitute a separate and legal lot for subdivision, assessment and zoning purposes, (vi) the Remaining Parcel will either constitute a separate and legal lot for tax purposes or an application for a separate tax lot identification will have been submitted and an escrow account will have been established with sufficient funds on deposit to pay taxes on both the Release Parcel and the Remaining Parcel, (vii) the release of the Release Parcel will not materially adversely affect ingress or egress to or from the Remaining Parcel or access to utilities for the Remaining Parcel, (viii) the Release Parcel does not include any improvements that are subject to the related Lease, (ix) the documents with respect to the Specified Permitted Subdivision will not impose any new obligations upon, or otherwise further burden, the Remaining Parcel in any way other than customary reciprocal easements; and (x) the Property Manager or the Tenant has obtained or caused to be unreasonably withheld) to the release and sale of such Mortgage Loan obtained all necessary approvals, consents or Mortgaged Property. permits with respect US-DOCS\96557504.296557504.7 In determining the Fair Market ValueValue with respect to any Mortgaged Property or Mortgage Loan, the Property Manager or the Special Servicer, as applicable, shall establish a price determined to be the most probable price which such Mortgage Loan or Mortgaged Property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. In making any such determination, the Property Manager or Special Servicer Servicer, as applicable, (X) may obtain an MAI appraisal of the related Mortgaged Property; provided that in the case of a sale of a Mortgaged Property or Mortgage Loan to an affiliate of theany Issuer or Spirit Realty pursuant to clause (vvi) of the definition of “Release Price”, the Property Manager or Special Servicer shall obtain such an appraisal unless (x) an appraisal with respect to the related Mortgaged Property or property securing such Mortgage Loan has been delivered within twelve months prior to the sale of such Mortgaged Property or Mortgage Loan and (y) neither the Property Manager nor the Special Servicer reasonably believes that the value of such Mortgaged Property or property securing such Mortgage Loan has materially increased in value since the date of such appraisal and (Y) shall assume the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: (i) buyer and seller are typically motivated; (ii) both parties are well informed or well advised, and acting in what they consider their best interests; (iii) a reasonable time is allowed for exposure in the open market; (iv) payment is made in terms of cash in United States dollars or in terms of financial arrangements comparable thereto; and (v) the price represents the normal consideration for such Mortgage Loan or Mortgaged Property unaffected by special or creative financing or sales concessions granted by anyone associated with the sale. The In making any such determination, the Property Manager or Special Servicer shall take into account, among other factors, the period and amount of the delinquency on such Mortgage Loan or Lease, the occupancy level and physical condition of the related Mortgaged Property, the state of the local economy in the area where the Mortgaged Property is located, and the time and expense associated with a purchaser purchaser’s foreclosing on the related Mortgaged Property. In addition, the Property Manager or the Special Servicer, as applicable, shall refer to all other relevant information obtained by it or otherwise contained in the Servicing Filerelated servicing file, taking into account any change in circumstances regarding the related Mortgaged Property known to the Property Manager or the Special Servicer, as applicable, that would materially affect the value of the related Mortgaged Property reflected in the most recent related appraisal. Furthermore, the Property Manager or the Special Servicer, as applicable, may consider available objective third party information obtained from generally available sources, as well as information obtained from vendors providing real estate services to the Property Manager or the Special Servicer, as applicable, concerning the market for distressed real estate loans and the real estate market for the subject property type in the area where the related Mortgaged Property is located. The Property Manager or the Special Servicer, as applicable, may also conclusively rely on any opinions or reports of qualified independent experts in real estate or commercial mortgage loan matters. All reasonable out-of-pocket costs and expenses incurred by the Property Manager or the Special Servicer, as applicable, pursuant to making a determination of Fair Market Value shall constitute, and be reimbursable as, Property Protection Advances. US-DOCS\96557504.296557504.7
(c) Any (i) Release Price (plus sales proceeds in excess thereof (any such excess amount, a “Purchase Premium”)) received by the applicable Issuer in connection with the release of a Mortgage Loan or Mortgaged Property (other than during a Disposition Period) and (ii) any Balloon PaymentsPayment or Principal PrepaymentsPrepayment received in connection with a Mortgage Loan, in each case shall be deposited into the Release Account (or, during the continuance of an Early Amortization Event, the Collection Account or an Exchange Account pursuant to Section 7.01(d) below).
(d) For the avoidance of doubt, an Issuer may obtain the release of a Mortgage Loan or a Mortgaged Property in exchange for one or more Qualified Substitute Mortgage Loans or one or more Qualified Substitute Mortgaged Properties, as applicable, subject to the terms hereof.
(i) After giving effect to any sale or exchange of a Mortgage Loan or Mortgaged Property, the aggregate Collateral Value of all Released Mortgaged Properties (determined as of the First Collateral Date with respect to each such Released Mortgaged Property) and Released Mortgage Loans (determined as of the release date with respect to each such Released Mortgage Loan) sold or exchanged by any Issuer during the Closing Date Period in which such sale or exchange occurs shall not exceed 35.0% of the Aggregate Collateral Value (determined as of the applicable Starting Closing Date) unless the Rating Condition is satisfied; provided that releases and exchanges or substitutions in connection with Collateral Defects, sales pursuant to the exercise of Third Party Purchase Options, sales during the Disposition Period and, transfers or exchanges of Terminated Lease Properties, Risk-Based Substitutions and releases in connection with an Early Refinancing Prepayment shall not be subject to the foregoing limitation or taken into consideration in determining such aggregate Collateral Values of such Released Mortgaged Properties and Released Mortgage Loans..
(ii) If any of the following criteria are satisfied, the release of a Mortgaged Property in exchange for one or more Qualified Substitute Mortgaged Properties or, solely in the case of clause (d) below, the release of a Mortgage Loan in exchange for one or more Qualified Substitute Mortgage Loans or Qualified Substitute Mortgaged Properties will constitute a “Risk- BasedRisk-Based Substitution”: (a) the remaining term to maturity of the related Lease is less than three years from the date of the proposed substitution and the Property Manager, in accordance with the Servicing Standard, determines that there is a reasonable risk of non-renewal of such Lease; based on written communications from the Tenant under such Lease, the Property Manager, in accordance with the Servicing Standard, determines that there is a reasonable risk of nonrenewal of such Lease; (c) the Issuer has received from the Tenant under the related Lease written notice of the non-renewal of such Lease; or (d) the Property Manager, in accordance with the Servicing Standard, determines that there is a reasonable risk of monetary default by the Tenant under such Lease or the Borrower under such Mortgage Loan, as applicable, or such a default has occurred or such Lease or Mortgage Loan is or relates to a Defaulted Asset. US-DOCS\96557504.296557504.7
Appears in 1 contract
Samples: Property Management and Servicing Agreement (Spirit MTA REIT)
Released Mortgage Loans and Released Mortgaged Properties. (a) The applicable Issuers may obtain the release (the “Release”) of Mortgage Loans or Mortgaged Properties (any such Mortgage Loan or Mortgaged Property, a “Released Mortgage Loan” or “Released Mortgaged Property” as applicable) from the lien of the Indenture in connection with (i) the exercise of a Third Party Purchase Option, (ii) the purchase or substitution of a Delinquent Asset or Defaulted Asset by the Special Servicer or the Property Manager or any assignee thereof, (iii) the repurchase or substitution of a Mortgage Loan or Mortgaged Property by the related Originator or Support Provider an applicable Cure Party due to a Collateral Defect, (iv) the sale of a Mortgage Loan or Mortgaged Property to the Support Provider, a or to a Support Provider SPE, Spirit Realty or to a third party unaffiliated with Spirit Realty or to a Spirit SPE or orthe Support Provider , (v) the exchange of a Mortgage Loan or Mortgaged Property with the Support Provider, a third partyparty unaffiliated with the Support Provider, a Support Provider SPE, Spirit Realty, Spirit SPE or a third-party unaffiliated with Spirit Realty or the Support Provider or a Spirit SPE; provided, however, that in no event shall the applicable Issuer obtain any such release unless, after giving effect to any such Release and any resulting changes to the Collateral Pool, the Indenture Trustee shall have received SPE(vi) an Opinion of Counsel to the effect that, for U.S. federal income tax purposes, no tax gain or loss will be recognized by any Noteholder or any Issuer with respect to any outstanding Series solely as a result of such Release and the resulting changes in the Collateral Pool (the “Tax Required Condition”)Early Refinancing Prepayment. In addition, without connection with the consent Release of the Series 2005-1 Insurer and at least 20 days’ prior written notice to the Rating Agencies, no Mortgage Loan or Mortgaged Property shall constitute a Qualified Substitute Mortgage Loan or Qualified Substitute Mortgaged Property, as applicable, unless, after giving effect to the transfer of such Mortgage Loan or Mortgaged Property to the applicable Issuer in exchange for a Released Mortgage Loan or (ix) any Released Mortgaged Property, as applicable, either (i) no Property Concentration the related Lease and the related Lease File shall exceed be simultaneously released from the applicable Maximum Property Concentration, lien of the Indenture or (iiiiy) if any Property Concentration on the date of such substitution exceeds Released Mortgage Loan, the related Maximum Property Concentration, such Property Concentration Loan File shall be reduced or remain unchanged after giving effect simultaneously released from the lien of the Indenture. The applicable Issuers shall obtain any Release that it is required to such substitutionobtain in accordance with the terms hereof.
(b) Except in connection with the release of a Mortgage Loan or a Mortgaged Property in exchange for a one or more Qualified Substitute Mortgage Loan Loans or a one or more Qualified Substitute Mortgaged PropertyProperties or a release in connection with an Early Refinancing Prepayment, the applicable Issuer will be required to obtain the applicable Release Price in order to obtain the Release of a Mortgage Loan or Mortgaged Property. The “Release Price” for any Mortgage Loan or Mortgaged Property will be an amount equal to (i) the Third Party Option Price if the release occurs in connection with any Third Party Purchase Option, (ii) the Fair Market Value with respect to any Delinquent Asset or Defaulted Asset purchased by the Special Servicer or the Property Manager or any assignee thereof the greater of (provided, that A) the Fair Market Value is equal to or greater than thereof and (B) the Allocated Loan Amount thereof as of the First Collateral Amount thereof)Date with respect thereto, (iii) the Payoff Amount with respect to any Mortgage Loan or Mortgaged Property repurchased by the related Originator or the Support Provider due to a Collateral Defect, (iv (or an equivalent amount recorded as a contribution in such calculations), (iv) with respect to any Terminated Lease Property, the Fair Market Value thereof, (v) the greater of (A) the Fair Market Value and (B) the sum of 125125115% of the Allocated Loan Amount thereof as of the First Collateral Amount Date with respect thereto plus unreimbursed Property Protection Advances (plus Advance Interest thereon) and ), Emergency Property Expenses Expenses, Extraordinary Expenses, Special Servicing Fees, Liquidation Fees and Workout Fees for any Mortgage Loan or Mortgaged Property sold to the Support Provider, a third party or Support Provider 92 US-DOCS\96557504.296557504.7 SPE, Spirit Realty, a Spirit SPE or to a third party unaffiliated with Spirit Realty or to a Spirit SPEthe Support Provider or (vvvi) the Fair Market Value of any Mortgage Loan or Mortgaged Property, as applicableapplicablein each case, in each case if (X) the Property Manager or the Special Servicer deems the release and sale of such Mortgage Loan or Mortgaged Property pursuant to this clause (vi) to be in the best interest of the Noteholders and (Y) the Rating Agency Notification Condition is satisfied with respect to such release and sale; provided, that after giving effect to such sale, the aggregate Collateral Value of all Mortgaged Properties (determined as of the First Collateral Date with respect to such Mortgaged Properties) and Mortgage Loans (determined as of the release date with respect to each such Released Mortgage Loan) owned by the Issuer that have been sold to affiliates of the Issuersany Issuer or Spirit Realty pursuant to this clause (vvi) would not exceed, (a) in any twelve month period, 15.0% of the Aggregate Collateral Value as of the most recent Series Closing Date (which may be as of the date hereof) or (b) 35.0% of the Aggregate Collateral Value (determined as of the applicable Starting Closing Date) during the Series 2005-1 Insurer gives Closing Period in which such sale occurs; provided, further, that the Issuers shall only be permitted to sell such Mortgaged Properties and Mortgage Loans pursuant to this clause (vvi) to its prior written consent affiliates (or affiliates of Spirit Realty) in the event that the Property Manager or the Special Servicer determines that such consent sale is reasonably necessary in order to manage the Cashflow Coverage Ratios or compliance with the Maximum Asset Concentrations. In addition, the Issuers shall not acquire any Mortgaged Property or Mortgage Loan pursuant to this Section 7.01 in the event that, after giving effect to such acquisition, any Property Concentration would exceed the Maximum Asset Concentrations set forth in the Indenture or any Series Supplement and in effect at the time of such acquisition. Notwithstanding anything in the Transaction Documents to the contrary, no Release Price will be payable with respect to any Release Parcel transferred to a Tenant pursuant to an obligation under the related Lease in connection with a Specified Permitted Subdivision and, in such case, the Indenture Trustee will release such property from the Collateral Pool, subject only to receipt of an Officer’s Certificate from the Property Manager certifying that: (i) the Specified Permitted Subdivision will not result in a reduction of the Collateral Value of the original property that was subdivided in connection with such Specified Permitted Subdivision, (ii) the Specified Permitted Subdivision is in compliance in all material respects with all requirements of law, (iii) the Specified Permitted Subdivision will not impair or otherwise adversely affect the liens, security interests and other rights of the Issuers in the portion of the property not being released (the “Remaining Parcel”), (iv) the Remaining Parcel will comply with all requirements of law (including, without limitation, all zoning (including any parking requirements) and building codes) as well as the applicable requirements of the Lease, (v) the Remaining Parcel will constitute a separate and legal lot for subdivision, assessment and zoning purposes, (vi) the Remaining Parcel will either constitute a separate and legal lot for tax purposes or an application for a separate tax lot identification will have been submitted and an escrow account will have been established with sufficient funds on deposit to pay taxes on both the Release Parcel and the Remaining Parcel, (vii) the release of the Release Parcel will not materially adversely affect ingress or egress to or from the Remaining Parcel or access to utilities for the Remaining Parcel, (viii) the Release Parcel does not include any improvements that are subject to the related Lease, (ix) the documents with respect to the Specified Permitted Subdivision will not impose any new obligations upon, or otherwise further burden, the Remaining Parcel in any way other than customary reciprocal easements; and (x) the Property Manager or the Tenant has obtained or caused to be unreasonably withheld) obtained all necessary approvals, consents or permits with respect 93 US-DOCS\96557504.296557504.7 to such Specified Permitted Subdivision (whether from applicable governmental or municipal authorities, parties to instruments of record affecting the release and sale of such Mortgage Loan property or Mortgaged Propertyotherwise). The certifications described in the preceding sentence are collectively referred to herein as the “Specified Permitted Subdivision Conditions.” Any costs or expenses incurred in connection with any Specified Permitted Subdivision will be paid by the Property Manager from its own funds. In determining the Fair Market ValueValue with respect to any Mortgaged Property or Mortgage Loan, the Property Manager or the Special Servicer, as applicable, shall establish a price determined to be the most probable price which such Mortgage Loan or Mortgaged Property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. In making any such determination, the Property Manager or Special Servicer Servicer, as applicable, (X) may obtain an MAI appraisal of the related Mortgaged Property; provided that in the case of a sale of a Mortgaged Property or Mortgage Loan to an affiliate of theany Issuer or Spirit Realty pursuant to clause (vvi) of the definition of “Release Price”, the Property Manager or Special Servicer shall obtain such an appraisal unless (x) an appraisal with respect to the related Mortgaged Property or property securing such Mortgage Loan has been delivered within twelve months prior to the sale of such Mortgaged Property or Mortgage Loan and (y) neither the Property Manager nor the Special Servicer reasonably believes that the value of such Mortgaged Property or property securing such Mortgage Loan has materially increased in value since the date of such appraisal and (Y) shall assume the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: (i) buyer and seller are typically motivated; (ii) both parties are well informed or well advised, and acting in what they consider their best interests; (iii) a reasonable time is allowed for exposure in the open market; (iv) payment is made in terms of cash in United States dollars or in terms of financial arrangements comparable thereto; and (v) the price represents the normal consideration for such Mortgage Loan or Mortgaged Property unaffected by special or creative financing or sales concessions granted by anyone associated with the sale. The In making any such determination, the Property Manager or Special Servicer shall take into account, among other factors, the period and amount of the delinquency on such Mortgage Loan or Lease, the occupancy level and physical condition of the related Mortgaged Property, the state of the local economy in the area where the Mortgaged Property is located, and the time and expense associated with a purchaser purchaser’s foreclosing on the related Mortgaged Property. In addition, the Property Manager or the Special Servicer, as applicable, shall refer to all other relevant information obtained by it or otherwise contained in the Servicing Filerelated servicing file, taking into account any change in circumstances regarding the related Mortgaged Property known to the Property Manager or the Special Servicer, as applicable, that would materially affect the value of the related Mortgaged Property reflected in the most recent related appraisal. Furthermore, the Property Manager or the Special Servicer, as applicable, may consider available objective third party information obtained from generally available sources, as well as information obtained from vendors providing real estate services to the Property Manager or the Special Servicer, as applicable, concerning the market for distressed real estate loans and the real estate market for the subject property type in the area where the related Mortgaged Property is located. The Property Manager or the Special Servicer, as applicable, may also conclusively rely on any opinions or reports of qualified independent experts in real estate or commercial mortgage loan matters. All reasonable out-of-pocket costs and expenses incurred by the Property Manager or the Special Servicer, as applicable, pursuant to making a determination of Fair Market Value shall constitute, and be reimbursable as, Property Protection Advances.loan
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Samples: Property Management and Servicing Agreement (Spirit Realty, L.P.)
