Common use of Secured Note Servicing Clause in Contracts

Secured Note Servicing. Prior to an Event of Default, Servicer shall service the Secured Note on behalf of Lenders. Such services shall include each of the following: (a) Servicer shall provide written notification to Borrower of Servicer’s appointment as agent for the Lenders to service the Secured Note, and shall instruct Borrower to make all Loan Payments due under the Loan Documents payable to Servicer. (b) Upon Servicer’s receipt of any Loan Payments, such Loan Payments shall be immediately deposited into a non-interest bearing trust account (the “Trust Account”) established with a federally insured bank in the name of Servicer, as agent for the Lenders, and maintained in accordance with the provisions of subsection 10238(k) of the California Real Estate Law (if applicable), Section 10145 and other applicable provisions of the California Business and Professions Code, Article 15 (commencing with Section 2830.1) of Chapter 6 of Title 10 of the California Code of Regulations, any applicable rules or regulations promulgated by the California Department of Real Estate and any other applicable laws, rules and regulations. The Lenders acknowledge that they shall not receive any interest on funds held in the Trust Account. (c) Loan Payments shall not be commingled with any other assets of Servicer or used for any other transactions or purposes whatsoever other than the transaction for which such Loan Payments are received by Servicer. (d) Prior to the occurrence of an Event of Default under the Loan Documents, that portion of any Loan Payment received by Servicer that constitutes Principal, accrued interest, and any other sums payable to the Lenders for any month under the Secured Note and this Agreement shall be delivered to each of the Lenders in accordance with Section 8.1. Following the occurrence of an Event of Default, all Loan Payments or Property Proceeds received by the Servicer shall be distributed (as provided in Section 8.2). (e) Servicer shall maintain records of its receipt, maintenance and disbursement of all Loan Payments, and shall cause the Trust Account to be inspected as required by such laws, rules and regulations as are applicable thereto and as may reasonably be requested by Lenders in accordance with this Agreement. (f) To the extent required by subsection 10238(k)(3) of the California Real Estate Law, Servicer shall arrange for the inspection of Servicer’s trust account by an independent certified public accountant and forward the report of such accountant to the California Commissioner of Real Estate if and to the extent, and in the manner, required by law. (g) Servicer shall provide or cause Borrower to provide to each Lender a monthly statement that indicates all Loan Payments disbursed to such Lender during the calendar year. Additionally, Servicer shall provide or cause Borrower to provide to each Lender an IRS form 1099-INT for each calendar year. (h) Servicer shall at all times maintain a valid California real estate broker’s license. (i) Servicer shall maintain possession of all original Loan Documents on behalf of all Lenders for such period as is required by law. (j) If the Loan is subject to a Construction Loan Agreement, Servicer shall disburse and administer the Loan pursuant to the Construction Loan Agreement; provided, however, that, absent notice to the contrary to Servicer by a Lender Majority, Servicer may agree to a modification in the plans and specifications or in the construction timetable, budget or draw schedule provided in the Construction Loan Agreement or otherwise modify the manner in which the Loan is disbursed or administered if in its business judgment it is advisable to do so, or if the change will not in its business judgment materially impair the value of the Security Property or impair the Borrower’s ability to perform under the Construction Loan Agreement (k) Servicer shall provide the Lenders written notification of the occurrence of any of the following events: (i) the recording of a notice of default by the Servicer; (ii) the recording of a notice of trustee’s sale; (iii) the receipt of any payment constituting an amount greater than or equal to five monthly payments from the Borrower, together with a request for reconveyance of the Security Property (including a description of any instructions for transfer or delivery); or (iv) a payment delinquency under the Secured Note of over 30 days.

Appears in 3 contracts

Samples: Loan Servicing and Equity Interest Agreement, Loan Servicing and Equity Interest Agreement, Loan Servicing and Equity Interest Agreement

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Secured Note Servicing. Prior to an Event of Default, Servicer shall service the Secured Second Note on behalf of Lenders. Such services shall include each of the Lenders in accordance with the following: (a) Servicer shall provide written notification to the Borrower of Servicer’s appointment as agent for the Lenders to service the Secured Note, and shall instruct Borrower to make all Loan Payments payments (“Payments”) due under the Loan Documents Secured Note and Deed of Trust payable to ServicerServicer who will collect such payments as the Lenders’ agent. (b) Upon Servicer’s receipt of any Loan Payments, such Loan Payments shall be immediately deposited into a non-interest bearing trust account (the “Trust Account”) established with a federally insured bank in the name of Servicer, as agent for the Lenders, and maintained in accordance with the provisions of subsection 10238(k) of the California Real Estate Law (if applicable), Section 10145 and other applicable provisions of the California Business and Professions Code, Article 15 (commencing with Section 2830.1) of Chapter 6 of Title 10 of the California Code of Regulations, any applicable rules or regulations promulgated by the California Department Bureau of Real Estate and any other applicable laws, rules and regulations. The Lenders acknowledge that they shall not receive any interest on funds held in the Trust Account. (c) Loan Payments shall not be commingled with any other assets of Servicer or used for any other transactions or purposes whatsoever other than the transaction for which such Loan Payments are received by Servicer. (d) Prior to the occurrence of an Event of Default under the Loan Documents, that portion of any Loan Payment received by Servicer that constitutes Principal, accrued interest, interest and any other sums payable to the Lenders for any month under the Secured Note and this Agreement shall be delivered to each of the Lenders as provided in accordance with Section 8.123(a), below. Following the occurrence of an Event of Default, all Loan Payments or Property Proceeds received by the Servicer shall be distributed (as provided in Section 8.223(b), below. (e) Servicer shall maintain records of its receipt, maintenance and disbursement of all Loan Payments, and shall cause the Trust Account to be inspected as required by such laws, rules and regulations as are applicable thereto and as may reasonably be requested by Lenders in accordance with this Agreement. (f) To the extent required by subsection 10238(k)(3) of the California Real Estate Law, Servicer shall arrange for the inspection of Servicer’s trust account by an independent certified public accountant and forward the report of such accountant to the California Commissioner of Real Estate if and to the extent, and in the manner, required by law. (g) In addition to monthly statements accompanying payments under Section 23(a), Servicer shall provide or cause Borrower to provide to each Lender a monthly an annual statement that indicates all Loan Payments disbursed to such Lender during the calendar year. Additionallyyear and additionally, Servicer shall provide or cause Borrower to provide to each Lender an IRS form 1099-INT for each calendar year. (h) Servicer shall at all times maintain a valid California real estate broker’s license. (i) Servicer shall maintain possession of all original Loan Documents on behalf of all Lenders for such period as is required by law. (j) If the Loan is subject to a Construction Loan AgreementLoan, Servicer shall disburse and administer the Loan pursuant to the Construction Loan Agreement; provided, however, that, absent notice Agreement subject to the contrary to Servicer by a Lender Majority, Servicer may agree to a modification in the plans and specifications or in the construction timetable, budget or draw schedule provided in the Construction Loan Agreement or otherwise modify the manner in which following: (i) if the Loan is disbursed or administered if in its business judgment it is advisable to do so, or if a Construction Loan based upon the change will not in its business judgment materially impair the “as completed” value of the Security Property with a construction holdback of less than $100,000; (A) Loan proceeds will be transferred from escrow to a construction disbursement account controlled by Servicer; and (B) Servicer will be directly responsible for monitoring construction and authorizing and making disbursements from the disbursement account to the Borrower, or impair on the Borrower’s ability to perform under behalf, in accordance with the Construction Loan Agreement; (k) Servicer shall provide the Lenders written notification of the occurrence of any of the following events: (i) the recording of a notice of default by the Servicer; (ii) if the recording of Loan is a notice of trustee’s sale; (iii) the receipt of any payment constituting an amount greater than or equal to five monthly payments from the Borrower, together Construction Loan with a request for reconveyance construction holdback of the Security Property more than $100,000: (including A) Loan proceeds will be transferred from escrow to a description of any instructions for transfer or delivery); or fund control account (iv“Control Account”) controlled by a payment delinquency under the Secured Note of over 30 days.third party Control Agent selected by Servicer;

Appears in 2 contracts

Samples: Loan Servicing and Equity Interest Agreement, Loan Servicing and Equity Interest Agreement

Secured Note Servicing. Prior to an Event of Default, Servicer shall service the Secured Note on behalf of Lenders. Such services shall include each of the following: (a) Servicer shall provide written notification to Borrower of Servicer’s appointment as agent for the Lenders to service the Secured Note, and shall instruct Borrower to make all Loan Payments due under the Loan Documents payable to Servicer. (b) Upon Servicer’s receipt of any Loan Payments, such Loan Payments shall be immediately deposited into a non-interest bearing trust account (the “Trust Account”) established with a federally insured bank in the name of Servicer, as agent for the Lenders, and maintained in accordance with the provisions of subsection 10238(k) of the California Real Estate Law (if applicable), Section 10145 and other applicable provisions of the California Business and Professions Code, Article 15 (commencing with Section 2830.1) of Chapter 6 of Title 10 of the California Code of Regulations, any applicable rules or regulations promulgated by the California Department of Real Estate and any other applicable laws, rules and regulations. The Lenders acknowledge that they shall not receive any interest on funds held in the Trust Account. (c) Loan Payments shall not be commingled with any other assets of Servicer or used for any other transactions or purposes whatsoever other than the transaction for which such Loan Payments are received by Servicer. (d) Prior to the occurrence of an Event of Default under the Loan Documents, that portion of any Loan Payment received by Servicer that constitutes Principal, accrued interest, and any other sums payable to the Lenders for any month under the Secured Note and this Agreement shall be delivered to each of the Lenders in accordance with Section 8.1. Following the occurrence of an Event of Default, all Loan Payments or Property Proceeds received by the Servicer shall be distributed (as provided in Section 8.2). (e) Servicer shall maintain records of its receipt, maintenance and disbursement of all Loan Payments, and shall cause the Trust Account to be inspected as required by such laws, rules and regulations as are applicable thereto and as may reasonably be requested by Lenders in accordance with this Agreement. (f) To the extent required by subsection 10238(k)(3) of the California Real Estate Law, Servicer shall arrange for the inspection of Servicer’s trust account Trust Account by an independent certified public accountant and forward the report of such accountant to the California Commissioner of Real Estate if and to the extent, and in the manner, required by law. (g) Servicer shall provide or cause Borrower to provide to each Lender a monthly statement that indicates all Loan Payments disbursed to such Lender during the calendar year. Additionally, Servicer shall provide or cause Borrower to provide to each Lender an IRS form 1099-INT for each calendar year. (h) Servicer shall at all times maintain a valid California real estate broker’s license. (i) Servicer shall maintain possession of all original Loan Documents on behalf of all Lenders for such period as is required by law. (j) If the Loan is subject to a Construction Loan Agreement, Servicer shall disburse and administer the Loan pursuant to the Construction Loan Agreement; provided, however, that, absent notice to the contrary to Servicer by a Lender Majority, Servicer may agree to a modification in the plans and specifications or in the construction timetable, budget or draw schedule provided in the Construction Loan Agreement or otherwise modify the manner in which the Loan is disbursed or administered if in its business judgment it is advisable to do so, or if the change will not in its business judgment materially impair the value of the Security Property or impair the Borrower’s ability to perform under the Construction Loan Agreement (k) Servicer shall provide the Lenders written notification of the occurrence of any of the following events: (i) the recording of a notice of default by the Servicer; (ii) the recording of a notice of trustee’s sale; (iii) the receipt of any payment constituting an amount greater than or equal to five monthly payments from the Borrower, together with a request for reconveyance of the Security Property (including a description of any instructions for transfer or delivery); or (iv) a payment delinquency under the Secured Note of over 30 days.

Appears in 2 contracts

Samples: Loan Servicing and Equity Interest Agreement, Loan Servicing and Equity Interest Agreement

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Secured Note Servicing. Prior to an Event of Default, Servicer shall service the Secured Second Note on behalf of Lenders. Such services shall include each of the Lenders in accordance with the following: (a) Servicer shall provide written notification to the Borrower of Servicer’s appointment as agent for the Lenders to service the Secured Note, and shall instruct Borrower to make all Loan Payments payments (“Payments”) due under the Loan Documents Secured Note and Deed of Trust payable to ServicerServicer who will collect such payments as the Lenders’ agent. (b) Upon Servicer’s receipt of any Loan Payments, such Loan Payments shall be immediately deposited into a non-interest bearing trust account (the “Trust Account”) established with a federally insured bank in the name of Servicer, as agent for the Lenders, and maintained in accordance with the provisions of subsection 10238(k) of the California Real Estate Law (if applicable), Section 10145 and other applicable provisions of the California Business and Professions Code, Article 15 (commencing with Section 2830.1) of Chapter 6 of Title 10 of the California Code of Regulations, any applicable rules or regulations promulgated by the California Department Bureau of Real Estate and any other applicable laws, rules and regulations. The Lenders acknowledge that they shall not receive any interest on funds held in the Trust Account. (c) Loan Payments shall not be commingled with any other assets of Servicer or used for any other transactions or purposes whatsoever other than the transaction for which such Loan Payments are received by Servicer. (d) Prior to the occurrence of an Event of Default under the Loan Documents, that portion of any Loan Payment received by Servicer that constitutes Principal, accrued interest, interest and any other sums payable to the Lenders for any month under the Secured Note and this Agreement shall be delivered to each of the Lenders as provided in accordance with Section 8.123(a), below. Following the occurrence of an Event of Default, all Loan Payments or Property Proceeds received by the Servicer shall be distributed (as provided in Section 8.223(b), below. (e) Servicer shall maintain records of its receipt, maintenance and disbursement of all Loan Payments, and shall cause the Trust Account to be inspected as required by such laws, rules and regulations as are applicable thereto and as may reasonably be requested by Lenders in accordance with this Agreement. (f) To the extent required by subsection 10238(k)(3) of the California Real Estate Law, Servicer shall arrange for the inspection of Servicer’s trust account by an independent certified public accountant and forward the report of such accountant to the California Commissioner of Real Estate if and to the extent, and in the manner, required by law. (g) In addition to monthly statements accompanying payments under Section 23(a), Servicer shall provide or cause Borrower to provide to each Lender a monthly an annual statement that indicates all Loan Payments disbursed to such Lender during the calendar year. Additionallyyear and additionally, Servicer shall provide or cause Borrower to provide to each Lender an IRS form 1099-INT for each calendar year. license. (h) Servicer shall at all times maintain a valid California real estate broker’s license.’s (i) Servicer shall maintain possession of all original Loan Documents on behalf of all Lenders for such period as is required by law. (j) If the Loan is subject to a Construction Loan AgreementLoan, Servicer shall disburse and administer the Loan pursuant to the Construction Loan Agreement; provided, however, that, absent notice Agreement subject to the contrary following: (i) if the Loan is a Construction Loan based upon the “as completed” value of the Security Property with a construction holdback of less than $100,000; (A) Loan proceeds will be transferred from escrow to a construction disbursement account controlled by Servicer; and (B) Servicer will be directly responsible for monitoring construction and authorizing and making disbursements from the disbursement account to the Borrower, or on the Borrower’s behalf, in accordance with the Construction Loan Agreement; (ii) if the Loan is a Construction Loan with a construction holdback of more than $100,000: (A) Loan proceeds will be transferred from escrow to a fund control account (“Control Account”) controlled by a Lender Majoritythird party Control Agent selected by Servicer; (B) construction will be monitored by a qualified third party Inspector selected and overseen by Servicer; and (C) Servicer will authorize disbursements from the Control Account by the Control Agent, which will be responsible for making such disbursement to the Borrower, or on the Borrower’s behalf, for the purposes and on the terms described in the Construction Loan Agreement. (iii) Servicer may agree to a modification in the plans and specifications or in the construction timetable, budget or draw schedule provided in the Construction Loan Agreement or otherwise modify the manner in which the Loan is disbursed or administered if in its business judgment it is advisable to do so, or if the change will not in its business judgment materially impair the value of the Security Property or impair the Borrower’s ability to perform under the Construction Loan Agreement (j) Servicer shall maintain possession of all original Loan Documents on behalf of all Lenders for such period as is required by law. (k) Servicer shall provide the Lenders written notification within 15 days of the occurrence of any of the following events: (i) the recording of a notice of default by the Servicer; (ii) the recording of a notice of trustee’s sale; (iii) the receipt of any payment constituting an amount greater than or equal to five monthly payments from the Borrower, together with a request for reconveyance of the Security Property (including a description of any instructions for transfer or delivery); or (iv) a payment delinquency under the Secured Note of over 30 days.

Appears in 1 contract

Samples: Loan Servicing and Equity Interest Agreement

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