Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan) is acquired for the benefit of the applicable Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the applicable Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by deed-in-lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and any related Serviced Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable, acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable, of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of any Trust REMIC, or cause any Trust REMIC to fail to qualify as a REMIC under the Code at any time that any of the Lower-Tier Regular Interests, the 000 Xxxxx Xxxxxx Regular Interests or the Regular Certificates is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related Serviced Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of any Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon any Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than an REO Property related to an Outside Serviced Mortgage Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be entitled (a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination), “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass-Through Certificates, Series 2019-C7, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”. The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO Account, within two (2) Business Days after receipt of properly identified funds, all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on any Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date (but not earlier than two (2) Business Days after such amounts are received and properly identified) the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related Collection Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, any related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.

Appears in 8 contracts

Samples: Pooling and Servicing Agreement (Bank 2020-Bnk26), Pooling and Servicing Agreement (Benchmark 2020-B16 Mortgage Trust), Pooling and Servicing Agreement (Bank 2019-Bnk24)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan) is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the ~~applicable~~ Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by deed-in-lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and any related Serviced Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code at any time that any ~~of the~~ Lower-Tier Regular ~~Interests, the 000 Xxxxx Xxxxxx Regular~~ Interests or ~~the~~ Regular Certificates is are outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related Serviced Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than an REO Property related to an Outside Serviced Mortgage Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion ~~Loan(s)~~Loan)), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion ~~Loan(s)~~Loan)) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination),~~ “~~[Name of Special Servicer]~~C-III Asset Management LLC, as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage ~~Trust 2019-C7~~Securities Inc., Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2016-C7P3, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan HoldersHolder, as their interests may appear--], REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two~~ one (21) Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related Collection Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, any related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.

Appears in 7 contracts

Samples: Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2016-P4), Pooling and Servicing Agreement (Wells Fargo Commercial Mortgage Trust 2016-C34), Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2016-Gc37)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan) is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the ~~applicable~~ Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by deed-in-lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and any related Serviced Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code at any time that any of the Lower-Tier Regular Interests, ~~the 000 Xxxxx Xxxxxx Regular Interests or~~ any of the Regular Certificates or the Class VRR Upper-Tier Regular Interest is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related Serviced Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than an REO Property related to an Outside Serviced Mortgage Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion ~~Loan(s)~~Loan)), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion ~~Loan(s)~~Loan)) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination)~~“Rialto Capital Advisors, ~~“[Name of Special Servicer]~~LLC, as Special Servicer, on behalf of ~~Wilmington Trust, National Association~~Deutsche Bank Trust Company Americas, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust ~~2019~~2017-C7P7, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2017-C7P7, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan HoldersHolder, as their interests may appear--], REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO Account, within ~~two~~ one (21) Business ~~Days~~ Day after ~~receipt of properly identified funds~~receipt, all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related Collection Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, any related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.

Appears in 7 contracts

Samples: Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2017-P8), Pooling and Servicing Agreement (GS Mortgage Securities Trust 2017-Gs6), Pooling and Servicing Agreement (CD 2017-Cd4 Mortgage Trust)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan) is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the ~~applicable~~ Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by deed-in-lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and any related Serviced Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code at any time that any of the Lower-Tier Regular Interests, ~~the 000 Xxxxx Xxxxxx Regular Interests or~~ any of the Regular Certificates or the Class VRR Upper-Tier Regular Interest is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related Serviced Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than an REO Property related to an Outside Serviced Mortgage Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion ~~Loan(s)~~Loan)), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion ~~Loan(s)~~Loan)) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be entitled ~~(a) with respect to each~~ “Midland Loan Services, a Division of ~~the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination)~~PNC Bank, ~~“[Name of Special Servicer]~~National Association, as Special Servicer, on behalf of ~~Wilmington Trust~~Xxxxx Fargo Bank, National Association, as Trustee, for the benefit of the registered Holders of ~~Citigroup Commercial~~ CD 2017-CD3 Mortgage ~~Trust 2019-C7~~Trust, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2017-C7CD3, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan HoldersHolder, as their interests may appear--], REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO Account, within two (2) Business Days after receipt of properly identified funds, all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date (but not earlier than two (2) Business Days after such amounts are received and properly identified) the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related Collection Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, any related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.

Appears in 7 contracts

Samples: Pooling and Servicing Agreement (UBS Commercial Mortgage Trust 2017-C1), Pooling and Servicing Agreement (CD 2017-Cd4 Mortgage Trust), Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2017-P7)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan) is acquired for the benefit of Certificateholders and the ~~applicable Certificateholders~~ Uncertificated VRR Interest Owner (or, with respect to a Serviced Loan Combination, for the benefit of the ~~applicable Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by deed-in-lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and any related Serviced Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code at any time that any of the Lower-Tier Regular Interests, ~~the 000 Xxxxx Xxxxxx Regular Interests or~~ any of the Regular Certificates or the Uncertificated VRR Interest is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, the related Serviced Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than an REO Property related to an Outside Serviced Mortgage Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination),~~ “~~[Name of Special Servicer]~~CWCapital Asset Management LLC, as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust ~~2019~~2020-C7GC46, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2020-C7GC46, and the Uncertificated VRR Interest Owner [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan ~~Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer~~Holder], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--, REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO Account, within two (2) Business Days after receipt of properly identified funds, all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related Collection Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, any related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.

Appears in 6 contracts

Samples: Pooling and Servicing Agreement (GS Mortgage Securities Trust 2020-Gsa2), Pooling and Servicing Agreement (Benchmark 2020-B21 Mortgage Trust), Pooling and Servicing Agreement (JPMDB Commercial Mortgage Securities Trust 2020-Cor7)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan) is acquired for the benefit of the ~~applicable~~ Certificateholders and the Combined Uncertificated VRR Interest Owner (or, with respect to a Serviced Loan Combination, for the benefit of the ~~applicable Certificateholders~~ Certificateholders, the Combined Uncertificated VRR Interest Owner and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such ~~Certificateholders~~ Certificateholders, the Combined Uncertificated VRR Interest Owner and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by deed-in-lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and any related Serviced Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier ~~REMIC~~ REMIC, the 360 Rxxxxxxx XXXXX or the ~~000~~ 100 Xxxxx Xxxxxx REMIC, as applicable, acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier ~~REMIC~~ REMIC, the 360 Rxxxxxxx XXXXX or the ~~000~~ 100 Xxxxx Xxxxxx REMIC, as applicable, of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of any Trust REMIC, or cause any Trust REMIC to fail to qualify as a REMIC under the Code at any time that any of the Lower-Tier Regular Interests, the ~~000~~ 360 Rxxxxxxx XXXXX or the 100 Xxxxx Xxxxxx REMIC or any of the Non-Uncertificated VRR Retained Pooled Regular ~~Interests~~ Certificates or the Class VRR Upper-Tier Regular ~~Certificates~~ Interest is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the ~~Certificateholders~~ Certificateholders, the Combined Uncertificated VRR Interest Owner and, if applicable, the related Serviced Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of any Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon any Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than an REO Property related to an Outside Serviced Mortgage Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of ~~Certificateholders~~ Certificateholders, the Combined Uncertificated VRR Interest Owner and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such ~~Certificateholders~~ Certificateholders, the Combined Uncertificated VRR Interest Owner and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of ~~Certificateholders~~ Certificateholders, the Combined Uncertificated VRR Interest Owner and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such ~~Certificateholders~~ Certificateholders, the Combined Uncertificated VRR Interest Owner and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination),~~ “~~[Name of Special Servicer]~~CWCapital Asset Management LLC, as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of ~~Citigroup Commercial~~ BMO 2022-C1 Mortgage ~~Trust 2019-C7~~Trust, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2022-C7C1, and the Combined Uncertificated VRR Interest Owner [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s)~~, as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer~~], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”. The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO Account, within two (2) Business Days after receipt of properly identified funds, all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on any Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related Collection Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the ~~Certificateholders~~ Certificateholders, the Combined Uncertificated VRR Interest Owner and, if applicable, any related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.

Appears in 6 contracts

Samples: Pooling and Servicing Agreement (BMO 2022-C3 Mortgage Trust), Pooling and Servicing Agreement (BMO 2022-C2 Mortgage Trust), Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2022-Gc48)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan) is acquired for the benefit of the applicable Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the applicable Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by deed-in-lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and any related Serviced Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of any Trust REMIC, or cause any Trust REMIC to fail to qualify as a REMIC under the Code at any time that any of the Lower-Tier ~~Regular Interests, the 000 Xxxxx Xxxxxx~~ Regular Interests or the Regular Certificates is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related Serviced Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of any Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon any Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than an REO Property related to an Outside Serviced Mortgage Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be entitled ~~(a) with respect to each~~ “Midland Loan Services, a Division of ~~the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination)~~PNC Bank, ~~“[Name of Special Servicer]~~National Association, as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of ~~Citigroup Commercial Mortgage Trust~~ Benchmark 2019-C7B15 Mortgage Trust, Commercial Mortgage Pass-Through Certificates, Series 2019-C7B15, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO Account, within two (2) Business Days after receipt of properly identified funds, all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on any Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date (but not earlier than two (2) Business Days after such amounts are received and properly identified) the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related Collection Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, any related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.

Appears in 6 contracts

Samples: Pooling and Servicing Agreement (Benchmark 2019-B14 Mortgage Trust), Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2019-C7), Pooling and Servicing Agreement (Benchmark 2019-B15 Mortgage Trust)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan) is acquired for the benefit of the ~~applicable~~ Certificateholders and the Uncertificated VRR Interest Owners (or, with respect to a Serviced Loan Combination, for the benefit of the ~~applicable Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owners and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owners and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by deed-in-lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and any related Serviced Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of any Trust REMIC, or cause any Trust REMIC to fail to qualify as a REMIC under the Code at any time that any of the Lower-Tier Regular Interests, any of the ~~000 Xxxxx Xxxxxx~~ Non-Vertically Retained Regular ~~Interests~~ Certificates or the Class VRR Upper-Tier Regular ~~Certificates~~ Interest is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owners and, if applicable, the related Serviced Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of any Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon any Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than an REO Property related to an Outside Serviced Mortgage Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owners and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owners and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owners and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owners and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination),~~ “~~[Name of Special Servicer]~~KeyBank National Association, as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of ~~Citigroup Commercial~~ Benchmark 2022-B35 Mortgage ~~Trust 2019-C7~~Trust, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2022-C7B35, and the Uncertificated VRR Interest Owners [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s)~~, as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer~~], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”. The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO Account, within two (2) Business Days after receipt of properly identified funds, all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on any Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related Collection Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owners and, if applicable, any related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.

Appears in 6 contracts

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to an Outside Serviced ~~Mortgage~~ Trust Loan) is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the ~~applicable~~ Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and any related Serviced Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code for federal income tax purposes at any time that any ~~of the~~ Lower-Tier Regular ~~Interests, the 000 Xxxxx Xxxxxx Regular~~ Interests or ~~the~~ Regular Certificates is are outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related Serviced Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than an REO Property related to an Outside Serviced ~~Mortgage~~ Trust Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan ~~Holder(s)~~ Holder (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan ~~Holder(s)~~ Holder constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion ~~Loan(s)~~Loan)), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Serviced Companion Loan ~~Holder(s)~~ Holder (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan ~~Holder(s)~~Holder, constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion ~~Loan(s)~~Loan)) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be entitled ~~(a) with respect to each~~ “Midland Loan Services, a Division of ~~the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination)~~PNC Bank, ~~“[Name of Special Servicer]~~National Association, as Special Servicer, on behalf of ~~Wilmington Trust, National Association~~Deutsche Bank Trust Company Americas, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage ~~Trust 2019-C7~~Securities Inc., Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2015-C7GC29, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan HoldersHolder, as their interests may appear--], REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two~~ one (21) Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith business judgment, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related ~~Collection~~ Prepayment Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, any related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced ~~Mortgage~~ Trust Loan.

Appears in 6 contracts

Samples: Pooling and Servicing Agreement (Benchmark 2021-B23 Mortgage Trust), Pooling and Servicing Agreement (GS Mortgage Securities Trust 2015-Gc32), Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2015-Gc29)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan) is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the ~~applicable~~ Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by deed-in-lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and any related Serviced Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code at any time that any of the Lower-Tier Regular Interests, any of the ~~000 Xxxxx Xxxxxx~~ Non-Vertically Retained Regular ~~Interests~~ Certificates or the Class VRR Upper-Tier Regular ~~Certificates~~ Interest is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related Serviced Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than an REO Property related to an Outside Serviced Mortgage Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion ~~Loan(s)~~Loan)), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion ~~Loan(s)~~Loan)) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination),~~ “~~[Name of Special Servicer]~~KeyBank National Association, as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust ~~2019~~2017-C7P8, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2017-C7P8, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan HoldersHolder, as their interests may appear--], REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO Account, within ~~two~~ one (21) Business ~~Days~~ Day after ~~receipt of properly identified funds~~receipt, all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related Collection Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, any related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.

Appears in 5 contracts

Samples: Pooling and Servicing Agreement (CD 2017-Cd6 Mortgage Trust), Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2017-C4), Pooling and Servicing Agreement (Morgan Stanley Bank of America Merrill Lynch Trust 2017-C34)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to ~~an Outside~~ a Non-Serviced Mortgage Loan) is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced ~~Loan Combination~~Whole Loan, for the benefit of the ~~applicable~~ Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders ~~and, if applicable, such~~ and Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and ~~any~~ the related ~~Serviced~~ Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code for federal income tax purposes at any time that any ~~of the Lower-Tier Regular Interests, the 000 Xxxxx Xxxxxx Regular Interests or the Regular Certificates~~ Certificate is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related ~~Serviced~~ Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund~~. (b)~~ . The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than ~~an REO Property related~~ with respect to ~~an Outside~~ the Non-Serviced Mortgage ~~Loan~~Loans) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan ~~Holder(s)~~ Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that ~~are~~ it determines in its reasonable business judgment to be substantially consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), ) constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer ~~and/or~~ or the Trustee) shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination)~~“Rialto Capital Advisors, ~~“[Name of Special Servicer]~~LLC, as Special Servicer, on behalf of ~~Wilmington Trust~~Wxxxx Fargo Bank, National Association, as Trustee, for the ~~benefit of the~~ registered Holders of ~~Citigroup~~ CSAIL 2015-C3 Commercial Mortgage ~~Trust 2019-C7~~Trust, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2015-~~C7,~~ C3 [~~IN THE CASE OF AN~~ in the case of an REO ~~PROPERTY RELATED TO A SERVICED LOAN COMBINATION~~Property related to a Whole Loan: and the related ~~Serviced~~ Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan HoldersHolder, as their interests may appear--], REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues ~~and proceeds~~ received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds, which shall be remitted to the Collection Account), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to ~~rely, conclusively,~~ rely conclusively on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced ~~Loan Combination~~Whole Loan, the related Serviced Whole Loan ~~Combination~~ Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from each REO Property during the related ~~Collection~~ Prepayment Period, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Whole Loan ~~Combination~~ became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, ~~any~~ the related ~~Serviced~~ Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if ~~any~~ the related ~~Serviced~~ Companion Loan is part of a REMIC, the related ~~Serviced~~ Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section ~~3.16(b~~3.16(a) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, ~~any~~ the related ~~Serviced~~ Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (cb) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related ~~Serviced~~ Companion Loan Holder ~~(or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) ~~and Section 3.16(b)~~ of this Agreement. (dc) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to ~~an Outside~~ a Non-Serviced Mortgage Loan.

Appears in 5 contracts

Samples: Pooling and Servicing Agreement (CSAIL 2016-C6 Commercial Mortgage Trust), Pooling and Servicing Agreement (Morgan Stanley Capital I Trust 2015-Ubs8), Pooling and Servicing Agreement (CSAIL 2015-C3 Commercial Mortgage Trust)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan) is acquired for the benefit of Certificateholders and the ~~applicable Certificateholders~~ Uncertificated VRR Interest Owner (or, with respect to a Serviced Loan Combination, for the benefit of the ~~applicable Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by deed-in-lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and any related Serviced Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code at any time that any of the Lower-Tier Regular Interests, any of the ~~000 Xxxxx Xxxxxx~~ Non-Vertically Retained Regular ~~Interests~~ Certificates or the Class VRR Upper-Tier Regular ~~Certificates~~ Interest is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, the related Serviced Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than an REO Property related to an Outside Serviced Mortgage Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination)~~“Rialto Capital Advisors, ~~“[Name of Special Servicer]~~LLC, as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7GC41, Commercial Mortgage Pass-Through Certificates, Series 2019-C7GC41, and the Uncertificated VRR Interest Owner [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan ~~Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer~~Holder], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--, REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO Account, within ~~two~~ one (21) Business ~~Days~~ Day after ~~receipt of properly identified funds~~receipt, all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related Collection Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, any related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.

Appears in 5 contracts

Samples: Pooling and Servicing Agreement (COMM 2019-Gc44 Mortgage Trust), Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2019-Gc43), Pooling and Servicing Agreement (GS Mortgage Securities Trust 2019-Gc42)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan) is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the ~~applicable~~ Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by deed-in-lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and any related Serviced Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code at any time that any of the Lower-Tier Regular Interests, any of the ~~000 Xxxxx Xxxxxx~~ Non-Vertically Retained Regular ~~Interests~~ Certificates or the Class VRR Upper-Tier Regular ~~Certificates~~ Interest is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related Serviced Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than an REO Property related to an Outside Serviced Mortgage Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be entitled ~~(a) with respect to each~~ “Midland Loan Services, a Division of ~~the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination)~~PNC Bank, ~~“[Name of Special Servicer]~~National Association, as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of ~~Citigroup Commercial~~ Benchmark 2018-B6 Mortgage ~~Trust 2019-C7~~Trust, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2018-C7B6, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan HoldersHolder, as their interests may appear--], REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO Account, within two (2) Business Days after receipt of properly identified funds, all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date (but not earlier than two (2) Business Days after such amounts are received and properly identified) the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related Collection Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, any related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.

Appears in 5 contracts

Samples: Pooling and Servicing Agreement (Benchmark 2018-B8 Mortgage Trust), Pooling and Servicing Agreement (Benchmark 2018-B7 Mortgage Trust), Pooling and Servicing Agreement (DBGS 2018-C1 Mortgage Trust)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan) is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the ~~applicable~~ Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by deed-in-lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and any related Serviced Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code at any time that any ~~of the~~ Lower-Tier Regular ~~Interests, the 000 Xxxxx Xxxxxx Regular~~ Interests or ~~the~~ Regular Certificates is are outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related Serviced Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than an REO Property related to an Outside Serviced Mortgage Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion ~~Loan(s)~~Loan)), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion ~~Loan(s)~~Loan)) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000~~ “Xxxxx ~~Xxxxxx Loan Combination)~~Fargo Bank, ~~“[Name of Special Servicer]~~National Association, as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage ~~Trust 2019-C7~~Securities Inc., Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2016-C7GC36, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan HoldersHolder, as their interests may appear--], REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two~~ one (21) Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related Collection Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, any related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.

Appears in 4 contracts

Samples: Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2016-P4), Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2016-C1), Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2016-Gc37)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan) is acquired for the benefit of the ~~applicable~~ Certificateholders and the Uncertificated VRR Interest Owner (or, with respect to a Serviced Loan Combination, for the benefit of the ~~applicable Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by deed-in-lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and any related Serviced Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code at any time that any of the Lower-Tier Regular Interests, any of the ~~000 Xxxxx Xxxxxx~~ Non-Vertically Retained Regular ~~Interests~~ Certificates or the Class VRR Upper-Tier Regular ~~Certificates~~ Interest is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, the related Serviced Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than an REO Property related to an Outside Serviced Mortgage Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination)~~“Rialto Capital Advisors, ~~“[Name of Special Servicer]~~LLC, as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of ~~Citigroup Commercial~~ Benchmark 2020-B19 Mortgage ~~Trust 2019-C7~~Trust, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2020-C7B19, and the Uncertificated VRR Interest Owner [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s)~~, as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer~~], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--, REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO Account, within two (2) Business Days after ~~receipt of properly identified funds~~receipt, all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related Collection Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, any related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.

Appears in 4 contracts

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan) is acquired for the benefit of the ~~applicable~~ Trust Certificateholders and the Uncertificated Interest Owners (or, with respect to a Serviced ~~Loan Combination~~Whole Loan, for the benefit of the ~~applicable Certificateholders~~ Trust Certificateholders, the Uncertificated Interest Owners and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such ~~Certificateholders~~ Trust Certificateholders, such Uncertificated Interest Owners and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by deed-in-lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and any related Serviced Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC, related Trust Subordinate Companion Loan REMIC or ~~the 000 Xxxxx Xxxxxx~~ related Mortgage Loan REMIC, as applicable, acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC, related Trust Subordinate Companion Loan REMIC or ~~the 000 Xxxxx Xxxxxx~~ related Mortgage Loan REMIC, as applicable, of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of any Trust REMIC, or cause any Trust REMIC to fail to qualify as a REMIC under the Code at any time that any of the Lower-Tier Regular Interests, the ~~000 Xxxxx Xxxxxx~~ related Trust Subordinate Companion Loan REMIC Regular ~~Interests or~~ Interests, the Regular Certificates is or the Loan-Specific Certificates are outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, ~~the~~ any related Loan-Specific Certificateholders and/or Loan-Specific Uncertificated Interest Owners and any related Serviced Companion Loan ~~Holder~~Holder(s), solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of any Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon any Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than an REO Property related to an Outside Serviced Mortgage Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of ~~Certificateholders~~ the Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, ~~the~~ any related Loan-Specific Certificateholders and/or Loan-Specific Uncertificated Interest Owners and any related Serviced Companion Loan Holder(s) (as a collective whole as if such ~~Certificateholders~~ Trust Certificateholders, such Uncertificated Interest Owners and, if applicable, ~~the~~ any related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB ~~Loan Combination~~Whole Loan, taking into account the subordinate nature of any related Subordinate Companion Loan(s))), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of ~~Certificateholders~~ the Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, ~~the~~ any related Loan-Specific Certificateholders and/or Loan-Specific Uncertificated Interest Owners and any related Serviced Companion Loan Holder(s) (as a collective whole as if such ~~Certificateholders~~ Trust Certificateholders, such Uncertificated Interest Owners and, if applicable, ~~the~~ any related Serviced Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB ~~Loan Combination~~Whole Loan, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be ~~entitled (a)~~ entitled, with respect to ~~each~~ the REO Property or group of ~~the~~ REO Properties relating to any Mortgage ~~Loans~~ Loan (other than any Outside Serviced Mortgage Loan) ~~and any~~ or Serviced ~~Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination)~~Whole Loan, “~~[Name of Special Servicer]~~LNR Partners, LLC, as Special Servicer, on behalf of Wilmington ~~Trust~~Savings Fund Society, ~~National Association~~FSB, as Trustee, for the benefit of the registered Holders of ~~Citigroup Commercial~~ Benchmark 2025-V13 Mortgage ~~Trust 2019-C7~~Trust, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2025-C7V13, and the Uncertificated Interest Owners [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED ~~LOAN COMBINATION~~WHOLE LOAN: and the related Serviced Companion Loan Holder(s)~~, as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer~~], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”. The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO Account, within two (2) Business Days after receipt of properly identified funds, all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on any Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the ~~Trustee~~ Back-Up Advancing Agent shall make such Advance unless the ~~Trustee~~ Back-Up Advancing Agent determines that such Advance would be a Nonrecoverable Advance. The ~~Trustee~~ Back-Up Advancing Agent shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The ~~Trustee~~Back-Up Advancing Agent, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the ~~Trustee~~Back-Up Advancing Agent, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced ~~Loan Combination~~Whole Loan, the related Whole Loan ~~Combination~~ Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date (~~but not earlier than two (2)~~ within 2 Business Days after such amounts are received and properly identified) the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related Collection Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Whole Loan ~~Combination~~ became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, any related Loan-Specific Certificateholders and/or Loan-Specific Uncertificated Interest Owners and any related Serviced Companion Loan ~~Holder~~ Holder(s) with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.c

Appears in 4 contracts

Samples: Pooling and Servicing Agreement (BBCMS Mortgage Trust 2025-5c33), Pooling and Servicing Agreement (Benchmark 2025-V13 Mortgage Trust), Pooling and Servicing Agreement (Benchmark 2025-V13 Mortgage Trust)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan) is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the ~~applicable~~ Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by deed-in-lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and any related Serviced Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code at any time that any ~~of the~~ Lower-Tier Regular ~~Interests, the 000 Xxxxx Xxxxxx Regular~~ Interests or ~~the~~ Regular Certificates is are outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related Serviced Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than an REO Property related to an Outside Serviced Mortgage Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion ~~Loan(s)~~Loan)), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion ~~Loan(s)~~Loan)) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination),~~ “~~[Name of Special Servicer]~~C-III Asset Management LLC, as Special Servicer, on behalf of ~~Wilmington Trust, National Association~~Deutsche Bank Trust Company Americas, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust ~~2019~~2016-C7C2, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2016-C7C2, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan HoldersHolder, as their interests may appear--], REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO Account, within ~~two~~ one (21) Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related Collection Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, any related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.

Appears in 4 contracts

Samples: Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2016-P5), Pooling and Servicing Agreement (JPMCC Commercial Mortgage Securities Trust 2016-Jp3), Pooling and Servicing Agreement (Wells Fargo Commercial Mortgage Trust 2016-Lc24)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property ~~(other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan)~~ is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the applicable Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a the Trustee, or its nominee ~~of the Trustee~~ (which shall not include the ~~Master~~ Servicer), or a separate trustee or co-trustee, on behalf of the Trust ~~Fund~~ Fund. The Special Servicer shall maintain accurate records with respect to each related REO Property reflecting the status of taxes, assessments and ~~any related Serviced Companion Loan Holders~~other similar items that are or may become a lien on such REO Property and the status of insurance premiums payable with respect thereto. The Special Servicer, on behalf of the Trust Fund, shall ~~sell~~ dispose of any REO Property ~~prior to~~ within two years after the ~~close of the third calendar year following the year in which the Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund acquires ownership of such REO ~~Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1),~~ Property for purposes of ~~Code~~ Section 860G(a)(8)) of the Code, unless (i) the ~~IRS grants (or does not deny)~~ Special Servicer, on behalf of the Lower-Tier REMIC, has applied for and received an extension of ~~time (an “REO Extension”~~such two-year period pursuant to Sections 856(e)(3) to and 860G(a)(8)(A) of the Code, in which case the Special Servicer shall sell such REO Property within the applicable extension period or (ii) the Special Servicer ~~obtains~~ seeks and subsequently receives an Opinion of Counsel ~~for~~ (which opinion shall be an expense of the ~~Special Servicer, the Certificate Administrator and the Trustee~~Trust Fund), addressed to the Special ~~Servicer, the Certificate Administrator~~ Servicer and the Trustee, to the effect that the holding by the ~~Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund of such REO Property ~~subsequent to the close of the third calendar year following the year in which such acquisition occurred~~ for an additional specified period will not ~~result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of any Trust REMIC, or~~ cause ~~any Trust REMIC~~ such REO Property to fail to qualify as ~~a REMIC under~~ "foreclosure property" within the meaning of Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of Section 860D(a) of the Code) at any time that any ~~of the Lower-Tier Regular Interests, the 000 Xxxxx Xxxxxx Regular Interests or the Regular Certificates~~ Certificate is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, in which case the Special Servicer shall sell such REO Property within such ~~longer~~ two-year period as ~~is permitted~~ extended by such ~~REO Extension or~~ additional specified period subject to any conditions set forth in such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard~~Fund, shall dispose of any REO Property held by the Trust Fund ~~(i)~~ prior to the ~~last~~ ____ day of ~~such~~ the period (taking into account extensions) by within which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section ~~3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property~~3.18 hereof. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders ~~and, if applicable, the related Serviced Companion Loan Holder,~~ solely for the purpose of its ~~prompt~~ disposition and sale in a manner which does not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) ~~or result in~~ of the ~~receipt by~~ Code (determined without regard to the ~~Trust Fund~~ exception applicable for purposes of ~~any “income from non-permitted assets” within the meaning of Code~~ Section ~~860F(a)(2)(B) or (i) endanger the status of any Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon any Trust REMIC or the Trust Fund~~860D(a)). (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property ~~(other than an REO Property related to an Outside Serviced Mortgage Loan)~~ as are consistent with the ~~Servicing Standard~~ manner in which the Special Servicer manages and operates similar property owned or managed by the ~~terms~~ Special Servicer or any of ~~this Agreement~~its Affiliates, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s)))Certificateholders, and, in connection therewith, the Special Servicer shall ~~only~~ agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a taxstandards. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “"REO Account”"), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled (a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination), “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association" __________ , as Trustee, in trust for ~~the benefit of the registered~~ Holders of ~~Citigroup Commercial Mortgage Trust 2019-C7~~Prudential Securities Secured Financing Corporation, Commercial Mortgage Pass-Through Certificates, Series ~~2019-C7~~__________ , [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”. ." The Special Servicer shall be entitled to ~~withdraw for its account~~ any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section ~~3.07(b) of this Agreement~~3.7(b). The Special Servicer shall deposit or cause to be deposited in the related REO ~~Account,~~ Account within ~~two (2)~~ ___ Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all ~~revenues and proceeds~~ REO Proceeds received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of ~~any~~ such REO Property; (ii) all real estate taxes and assessments in respect of ~~any~~ such REO Property that may result in the imposition of a lien thereon;; and (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore ~~any REO Property including, if applicable, the payments of any ground rents in respect of~~ such REO Property~~; and (iv)~~ , including any ~~taxes imposed on any Trust REMIC in respect of net income from foreclosure~~ property ~~in accordance with Section 4.05 of this Agreement~~management fees. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iviii) ~~above and~~ above, the ~~Special~~ Servicer ~~has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days~~ (or, in ~~an emergency situation or on an urgent basis, two (2) Business Days, provided that~~ the ~~written notice sets forth~~ event the ~~nature of the emergency or the basis of the urgency) prior~~ Servicer is unable to ~~the date that such amounts are due~~perform, the ~~Master Servicer~~ Trustee or Fiscal Agent) shall ~~advance~~ make an Advance equal to the amount of such shortfall unless the ~~Master~~ Servicer determines, in ~~accordance with the Servicing Standard~~its good faith judgment, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The ~~Trustee shall be entitled to rely, conclusively, on any determination by the Master~~ Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent ~~set forth in~~ permitted pursuant to Section ~~3.06 and/or, if applicable, Section 3.06A of this Agreement~~3.6. The Special Servicer shall ~~withdraw~~ remit to the Servicer from each REO Account ~~and remit to the Master Servicer~~ for deposit ~~into~~ in the Collection ~~Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account,~~ Account on a monthly basis prior to the related ~~Master Servicer~~ Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from ~~each REO Property during~~ the related ~~Collection Period~~REO Property, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in ~~each~~ such REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New ~~Lease,~~ Lease if the New ~~Lease~~ Lease, by its ~~terms~~ terms, will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New ~~Lease,~~ Lease other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan ~~or Serviced Loan Combination~~ became imminent, all within the meaning of ~~Code~~ Section 856(e)(4)(B)) of the Code; or (iv) Directly Operate or perform any construction work on, or allow any Person (other than an Independent Contractor) to Directly Operate or perform any construction work on, any REO Property on on, any date more than 90 __ days after its date of acquisition by the Trust Fund~~, unless such Person is an Independent Contractor~~; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special ~~Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator~~ Servicer and the Trustee (which opinion shall be an expense of the Trust ~~Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder~~Fund) to the effect that such action will not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of ~~Code~~ Section 860D(a)) of the Code) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent ~~Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds,~~ Contractor for the operation and management of any REO ~~Property,~~ Property within 90 __ days of the Trust Fund’s 's acquisition thereof (unless the Special Servicer shall have provided the Trustee ~~and the Certificate Administrator~~ with an Opinion of Counsel that the operation and management of ~~any~~ such REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than ~~thirty~~ _____ days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section ~~3.16(b~~3.17(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders ~~and, if applicable, any related Serviced Companion Loan Holder~~ with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) Promptly following any acquisition by the Trust Fund of an REO Property, the Special Servicer shall obtain (i) an update of any appraisal performed pursuant to Section 3.10 which is more than ___ months old, or (ii) to the extent that an appraisal has not been obtained pursuant to such Section, an appraisal of such REO Property by an Independent appraiser familiar with the area in which such REO Property is located in order to determine the fair market value of such REO Property and shall notify the Depositor and the Trustee of the results of such appraisal. Any such appraisal shall be conducted in accordance with MAI standards and the cost thereof shall be an expense of the Trust Fund. (d) When and as necessary, the Special Servicer shall send to the Trustee ~~and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section ~~3.16(a) and Section 3.16(b) of this Agreement~~3.17(b). ~~(d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.~~

Appears in 4 contracts

Samples: Pooling and Servicing Agreement (Prudential Securities Secured Financing Corp), Pooling and Servicing Agreement (Prudential Securities Secured Financing Corp), Pooling and Servicing Agreement (Prudential Securities Secured Financing Corp)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan) is acquired for the benefit of the ~~applicable~~ Certificateholders and the Uncertificated VRR Interest Owner (or, with respect to a Serviced ~~Loan Combination~~Whole Loan, for the benefit of the ~~applicable Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by deed-in-lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and any related Serviced Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC or the ~~000 Xxxxx Xxxxxx~~ related Loan REMIC, as applicable, acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC or the ~~000 Xxxxx Xxxxxx~~ related Loan REMIC, as applicable, of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of any Trust REMIC, or cause any Trust REMIC to fail to qualify as a REMIC under the Code at any time that any of the Lower-Tier Regular Interests, the ~~000 Xxxxx Xxxxxx~~ Loan REMIC Regular ~~Interests~~ Interest or any of the Regular Certificates or the Uncertificated VRR Interest is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, the related Serviced Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of any Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon any Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than an REO Property related to an Outside Serviced Mortgage Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB ~~Loan Combination~~Whole Loan, taking into account the subordinate nature of any related Subordinate Companion Loan(s))), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB ~~Loan Combination~~Whole Loan, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination)~~“Rialto Capital Advisors, ~~“[Name of Special Servicer]~~LLC, as Special Servicer, on behalf of ~~Wilmington Trust~~Computershare Trust Company, National Association, as Trustee, for the benefit of the registered Holders of ~~Citigroup Commercial~~ BMO 2023-C5 Mortgage ~~Trust 2019-C7~~Trust, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2023-C7C5, and the Uncertificated VRR Interest Owner [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED ~~LOAN COMBINATION~~WHOLE LOAN: and the related Serviced Companion Loan Holder(s)~~, as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer~~], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”. The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO Account, within two (2) Business Days after receipt of properly identified funds, all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on any Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced ~~Loan Combination~~Whole Loan, the related Whole Loan ~~Combination~~ Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related Collection Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Whole Loan ~~Combination~~ became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, any related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.

Appears in 3 contracts

Samples: Pooling and Servicing Agreement (BMO 2023-C6 Mortgage Trust), Pooling and Servicing Agreement (BBCMS 2023-C20), Pooling and Servicing Agreement (BMO 2023-C4 Mortgage Trust)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property ~~(other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan)~~ is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a ~~Serviced Loan Combination~~Whole Loan, for the benefit of the ~~applicable~~ Certificateholders and the related ~~Serviced~~ Companion Loan ~~Holder(s)~~Holders) (as a collective whole as if such Certificateholders ~~and, if applicable, such Serviced~~ and Companion Loan ~~Holder(s)~~ Holders constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and ~~any~~ the related ~~Serviced~~ Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code for federal income tax purposes at any time that any ~~of the~~ Lower-Tier Regular ~~Interests, the 000 Xxxxx Xxxxxx Regular~~ Interests or ~~the~~ Regular Certificates is are outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related ~~Serviced~~ Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property ~~(other than an REO Property related to an Outside Serviced Mortgage Loan)~~ as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan ~~Holder(s)~~ Holders (as a collective whole as if such Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan ~~Holder(s)~~ Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan ~~Holder(s)~~ Holder (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan ~~Holder(s),~~ Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer ~~and/or~~ or the Trustee) shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination),~~ “[~~Name of~~ LNR Partners, LLC] [the applicable Special Servicer], as Special Servicer, on behalf of ~~Wilmington Trust, National Association~~Deutsche Bank Trust Company Americas, as Trustee, for the ~~benefit of the~~ registered Holders of ~~Citigroup Commercial~~ GS Mortgage ~~Trust 2019-C7~~Securities Corporation II, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2014-~~C7,~~ GC18 [IN THE CASE OF AN REO PROPERTY RELATED TO A ~~SERVICED LOAN COMBINATION~~WHOLE LOAN: and the related ~~Serviced~~ Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan HoldersHolder, as their interests may appear--], REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two~~ one (21) Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues ~~and proceeds~~ received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds, which shall be remitted to the Collection Account), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith business judgment, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a ~~Serviced Loan Combination~~Whole Loan, the related Whole Loan ~~Combination~~ Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from each REO Property during the related ~~Collection~~ Prepayment Period, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or ~~Serviced~~ Whole Loan ~~Combination~~ became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, ~~any~~ the related ~~Serviced~~ Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if ~~any~~ the related ~~Serviced~~ Companion Loan is part of a REMIC, the related ~~Serviced~~ Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, ~~any~~ the related ~~Serviced~~ Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related ~~Serviced~~ Companion Loan Holder ~~(or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. ~~(d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.~~

Appears in 3 contracts

Samples: Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2014-Gc19), Pooling and Servicing Agreement (GS Mortgage Securities Trust 2014-Gc18), Pooling and Servicing Agreement (GS Mortgage Securities Trust 2014-Gc18)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan) is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the ~~applicable~~ Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by deed-in-lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and any related Serviced Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code at any time that any of the Lower-Tier Regular Interests, any of the ~~000 Xxxxx Xxxxxx~~ Non-Vertically Retained Regular ~~Interests~~ Certificates or the Class VRR Upper-Tier Regular ~~Certificates~~ Interest is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related Serviced Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than an REO Property related to an Outside Serviced Mortgage Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination)~~“LNR Partners, ~~“[Name of Special Servicer]~~LLC, as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of ~~Citigroup Commercial Mortgage Trust~~ Benchmark 2019-C7B9 Mortgage Trust, Commercial Mortgage Pass-Through Certificates, Series 2019-C7B9, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan HoldersHolder, as their interests may appear--], REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO Account, within two (2) Business Days after receipt of properly identified funds, all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date (but not earlier than two (2) Business Days after such amounts are received and properly identified) the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related Collection Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, any related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.

Appears in 3 contracts

Samples: Pooling and Servicing Agreement (Benchmark 2019-B10 Mortgage Trust), Pooling and Servicing Agreement (GS Mortgage Securities Trust 2019-Gc38), Pooling and Servicing Agreement (Benchmark 2019-B9 Mortgage Trust)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property ~~(other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan)~~ is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the applicable Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a the Trustee, or its nominee ~~of the Trustee~~ (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holders~~Fund. The Special Servicer, on behalf of the Trust Fund, shall ~~sell~~ dispose of any REO Property prior to the close of the third calendar year ~~following~~ beginning after the ~~year in which the Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund acquires ownership of such REO ~~Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1),~~ Property for purposes of ~~Code~~ Section 860G(a)(8)) of the Code, unless (i) the ~~IRS grants (or does not deny)~~ Special Servicer on behalf of the Lower-Tier REMIC has applied for an extension of ~~time (an “REO Extension”~~such period pursuant to Sections 856(e)(3) to and 860G(a)(8)(A) of the Code, in which case the Special Servicer shall sell such REO Property within the applicable extension period or (ii) the Special Servicer ~~obtains~~ seeks and subsequently receives an Opinion of Counsel ~~for~~ (which opinion shall be an expense of the ~~Special Servicer, the Certificate Administrator and the Trustee~~Trust Fund), addressed to the Special ~~Servicer, the Certificate Administrator~~ Servicer and ~~the~~ Trustee, to the effect that the holding by the ~~Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund of such REO Property ~~subsequent to the close of the third calendar year following the year in which such acquisition occurred~~ for an additional specified period will not ~~result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of any Trust REMIC, or~~ cause ~~any Trust REMIC~~ such REO Property to fail to qualify as ~~a REMIC under~~ "foreclosure property" within the meaning of Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of Section 860D(a) of the Code) at any time that any ~~of the Lower-Tier Regular Interests, the 000 Xxxxx Xxxxxx Regular Interests or the Regular Certificates~~ Certificate is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, ~~the Special Servicer~~ in which event such period shall ~~sell such REO Property within such longer period as is permitted~~ be extended by such ~~REO Extension or~~ additional specified period subject to any conditions set forth in such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard~~Fund, shall dispose of any REO Property held by the Trust Fund ~~(i)~~ prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section ~~3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property~~3.18 hereof. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders ~~and, if applicable, the related Serviced Companion Loan Holder,~~ solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) ~~or result in~~ of the ~~receipt by~~ Code (determined without regard to the ~~Trust Fund~~ exception applicable for purposes of ~~any “income from non-permitted assets” within the meaning of Code~~ Section ~~860F(a)(2)(B) or (i) endanger the status of any Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon any Trust REMIC or the Trust Fund~~860D(a)). (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement (and, with respect to the Americold Pool Loan, the Co-Lender Agreement), to do any and all things in connection with any REO Property ~~(other than an REO Property related to an Outside Serviced Mortgage Loan)~~ as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s)))Certificateholders, and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “"net income from foreclosure property,” " within the meaning of ~~Code~~ Section 860G(c)) of the Code, which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the ~~Certificate Administrator~~ Trustee in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “"REO Account”"), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled ~~(a) with respect to each of the~~ "GMAC Commercial Mortgage ~~Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination), “[Name of Special Servicer]~~Corporation, as Special Servicer, ~~on behalf of Wilmington Trust,~~ in trust for LaSalle National ~~Association~~Bank, as Trustee, in trust for ~~the benefit of the registered~~ Holders of ~~Citigroup Commercial~~ GS Mortgage ~~Trust 2019-C7~~Securities Corporation II, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~1998-C7C1 II, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”. ." The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b~~) of this Agreement~~). The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues ~~and proceeds~~ received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds, which shall be remitted pursuant to Section 3.18(e) to the Collection Account), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO ~~Property including, if applicable, the payments of any ground rents in respect of such REO~~ Property; and (iv) any taxes imposed on ~~any Trust~~ the Upper-Tier REMIC or Lower-Tier REMIC in respect of net income from foreclosure property in accordance with Section ~~4.05 of this Agreement~~4.05. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iviii) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five ~~(5)~~ Business Days ~~(or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency)~~ prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith judgment, that such Advance would be a Nonrecoverable ~~Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account)~~Advance. If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such ~~Advance unless~~ Advance; and if the Trustee fails to make any such Advance, the Fiscal Agent shall make such Advance, unless in either case, the Trustee or the Fiscal Agent determines that such Advance would be a Nonrecoverable Advance. The Trustee and the Fiscal Agent shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The ~~Trustee~~Trustee and the Fiscal Agent, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall ~~use its good faith business judgment~~be subject to the standards applicable to the Master Servicer hereunder. The Master ~~Servicer~~ Servicer, the Trustee or the ~~Trustee~~Fiscal Agent, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section ~~3.06 and/or, if applicable, Section 3.06A of this Agreement~~3.06. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection ~~Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account,~~ Account on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from each REO ~~Property during the related Collection Period~~Property, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan ~~or Serviced Loan Combination~~ became imminent, all within the meaning of ~~Code~~ Section 856(e)(4)(B)) of the Code; or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special ~~Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator~~ Servicer and the Trustee (which opinion shall be an expense of the Trust ~~Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder~~Fund) to the effect that such action will not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of ~~Code~~ Section 860D(a)) of the Code) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s 's acquisition thereof (unless the Special Servicer shall have provided the Trustee ~~and the Certificate Administrator~~ with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section ~~3.16(b~~3.17(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders ~~and, if applicable, any related Serviced Companion Loan Holder~~ with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee ~~and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with ~~Section 3.16(a~~Sections 3.17(a) and ~~Section 3.16(b) of this Agreement~~3.17(b). ~~(d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.~~

Appears in 3 contracts

Samples: Pooling and Servicing Agreement (Gs Mortgages Sec Corp Ii Com Mort Pas THR Cert Ser 1998-C1), Pooling and Servicing Agreement (Gs Mortgages Sec Corp Ii Com Mort Pas THR Cert Ser 1998-C1), Pooling and Servicing Agreement (Gs Mortgages Sec Corp Ii Com Mort Pas THR Cert Ser 1998-C1)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan) is acquired for the benefit of the ~~applicable~~ Certificateholders and the Uncertificated VRR Interest Owners (or, with respect to a Serviced Loan Combination, for the benefit of the ~~applicable Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owners and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owners and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by deed-in-lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and any related Serviced Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC or the ~~000 Xxxxx Xxxxxx~~ related Loan REMIC, as applicable, acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC or the ~~000 Xxxxx Xxxxxx~~ related Loan REMIC, as applicable, of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of any Trust REMIC, or cause any Trust REMIC to fail to qualify as a REMIC under the Code at any time that any of the Lower-Tier Regular Interests, any of the ~~000 Xxxxx Xxxxxx~~ Loan REMIC Regular ~~Interests~~ Interests, any of the Non-Vertically Retained Regular Certificates or the Class VRR Upper-Tier Regular ~~Certificates~~ Interest is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owners and, if applicable, the related Serviced Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of any Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon any Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than an REO Property related to an Outside Serviced Mortgage Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owners and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owners and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owners and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owners and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be entitled ~~(a) with respect to each~~ “Midland Loan Services, a Division of ~~the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination)~~PNC Bank, ~~“[Name of Special Servicer]~~National Association, as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of ~~Citigroup Commercial~~ Benchmark 2021-B27 Mortgage ~~Trust 2019-C7~~Trust, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2021-C7B27, and the Uncertificated VRR Interest Owners [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s)~~, as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer~~], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”. The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO Account, within two (2) Business Days after receipt of properly identified funds, all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on any Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related Collection Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owners and, if applicable, any related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.

Appears in 3 contracts

Samples: Pooling and Servicing Agreement (Benchmark 2021-B28 Mortgage Trust), Pooling and Servicing Agreement (Benchmark 2020-B17 Mortgage Trust), Pooling and Servicing Agreement (Benchmark 2021-B27 Mortgage Trust)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to ~~an Outside~~ the Non-Serviced Mortgage ~~Loan~~Loans) is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced ~~Loan Combination~~Whole Loan, for the benefit of the ~~applicable~~ Certificateholders and the related ~~Serviced~~ Companion Loan ~~Holder(s)~~Holders) (as a collective whole as if such Certificateholders ~~and, if applicable, such Serviced~~ and Companion Loan ~~Holder(s)~~ Holders constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and ~~any~~ the related ~~Serviced~~ Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code for federal income tax purposes at any time that any ~~of the~~ Lower-Tier Regular ~~Interests, the 000 Xxxxx Xxxxxx Regular~~ Interests or ~~the~~ Regular Certificates is are outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related ~~Serviced~~ Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than ~~an REO Property related~~ with respect to ~~an Outside~~ the Non-Serviced Mortgage ~~Loan~~Loans) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan ~~Holder(s)~~ Holders (as a collective whole as if such Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan ~~Holder(s)~~ Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan ~~Holder(s)~~ Holder (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan ~~Holder(s),~~ Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer ~~and/or~~ or the Trustee) shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination),~~ “[~~Name of~~ CWCapital Asset Management LLC] [the applicable Special Servicer], as Special Servicer, on behalf of ~~Wilmington Trust, National Association~~Deutsche Bank Trust Company Americas, as Trustee, for the benefit of the registered Holders of ~~Citigroup Commercial~~ GS Mortgage ~~Trust 2019-C7~~Securities Corporation II, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2014-~~C7,~~ GC22 [IN THE CASE OF AN REO PROPERTY RELATED TO A ~~SERVICED LOAN COMBINATION~~WHOLE LOAN: and the related ~~Serviced~~ Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan HoldersHolder, as their interests may appear--], REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two~~ one (21) Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues ~~and proceeds~~ received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds, which shall be remitted to the Collection Account), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced ~~Loan Combination~~Whole Loan, the related Serviced Whole Loan ~~Combination~~ Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from each REO Property during the related ~~Collection~~ Prepayment Period, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Whole Loan ~~Combination~~ became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, ~~any~~ the related ~~Serviced~~ Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if ~~any~~ the related ~~Serviced~~ Companion Loan is part of a REMIC, the related ~~Serviced~~ Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, ~~any~~ the related ~~Serviced~~ Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related ~~Serviced~~ Companion Loan Holder ~~(or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to ~~an Outside~~ the Non-Serviced Mortgage ~~Loan~~Loans.

Appears in 3 contracts

Samples: Pooling and Servicing Agreement (Morgan Stanley Capital I Trust 2017-H1), Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2014-Gc23), Pooling and Servicing Agreement (GS Mortgage Securities Trust 2014-Gc22)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to an Outside Serviced ~~Mortgage~~ Trust Loan) is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the ~~applicable~~ Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and any related Serviced Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code for federal income tax purposes at any time that any ~~of the~~ Lower-Tier Regular ~~Interests, the 000 Xxxxx Xxxxxx Regular~~ Interests or ~~the~~ Regular Certificates is are outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related Serviced Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than an REO Property related to an Outside Serviced ~~Mortgage~~ Trust Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion ~~Loan(s)~~Loan)), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion ~~Loan(s)~~Loan)) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination)~~“LNR Partners, ~~“[Name of Special Servicer]~~LLC, as Special Servicer, on behalf of ~~Wilmington Trust, National Association~~Deutsche Bank Trust Company Americas, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust ~~2019~~2015-C7P1, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2015-C7P1, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan HoldersHolder, as their interests may appear--], REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two~~ one (21) Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith business judgment, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related ~~Collection~~ Prepayment Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, any related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced ~~Mortgage~~ Trust Loan.

Appears in 3 contracts

Samples: Pooling and Servicing Agreement (Wells Fargo Commercial Mortgage Trust 2015-Nxs3), Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2015-Gc33), Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2015-P1)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to ~~an Outside~~ a Non-Serviced Mortgage Loan) is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced ~~Loan Combination~~Whole Loan, for the benefit of the ~~applicable~~ Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders ~~and, if applicable, such~~ and Serviced Companion Loan Holder(s) constituted a single lender, taking into account the subordinate nature of any related Subordinate Companion Loan) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and ~~any~~ the related ~~Serviced~~ Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code for federal income tax purposes at any time that any ~~of the Lower-Tier Regular Interests, the 000 Xxxxx Xxxxxx Regular Interests or the Regular Certificates~~ Certificate is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related ~~Serviced~~ Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund~~. (b)~~ . The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than ~~an REO Property related~~ with respect to ~~an Outside~~ the Non-Serviced Mortgage ~~Loan~~Loans) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan ~~Holder(s)~~ Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination~~lender, taking into account the subordinate nature of any related Subordinate Companion ~~Loan(s))~~Loan), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that ~~are~~ it determines in its reasonable business judgment to be substantially consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), ) constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination~~lender, taking into account the subordinate nature of any related Subordinate Companion ~~Loan(s))~~Loan) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer ~~and/or~~ or the Trustee) shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination),~~ “~~[Name of Special Servicer]~~C-III Asset Management LLC, as Special Servicer, on behalf of ~~Wilmington Trust~~Xxxxx Fargo Bank, National Association, as Trustee, for the ~~benefit of the~~ registered Holders of ~~Citigroup~~ CSAIL 2015-C1 Commercial Mortgage ~~Trust 2019-C7~~Trust, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2015-~~C7,~~ C1 [~~IN THE CASE OF AN~~ in the case of an REO ~~PROPERTY RELATED TO A SERVICED LOAN COMBINATION~~Property related to a Whole Loan: and the related ~~Serviced~~ Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan HoldersHolder, as their interests may appear--], REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues ~~and proceeds~~ received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds, which shall be remitted to the Collection Account), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced ~~Loan Combination~~Whole Loan, the related Serviced Whole Loan ~~Combination~~ Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from each REO Property during the related ~~Collection~~ Prepayment Period, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Whole Loan ~~Combination~~ became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, ~~any~~ the related ~~Serviced~~ Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if ~~any~~ the related ~~Serviced~~ Companion Loan is part of a REMIC, the related ~~Serviced~~ Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section ~~3.16(b~~3.16(a) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, ~~any~~ the related ~~Serviced~~ Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (cb) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related ~~Serviced~~ Companion Loan Holder ~~(or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) ~~and Section 3.16(b)~~ of this Agreement. (dc) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to ~~an Outside~~ a Non-Serviced Mortgage Loan.

Appears in 3 contracts

Samples: Pooling and Servicing Agreement (CSAIL 2015-C3 Commercial Mortgage Trust), Pooling and Servicing Agreement (CSAIL 2015-C2 Commercial Mortgage Trust), Pooling and Servicing Agreement (CSAIL 2015-C1 Commercial Mortgage Trust)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to an Outside Serviced ~~Mortgage~~ Trust Loan) is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the ~~applicable~~ Certificateholders and the related Serviced Companion Loan ~~Holder(s)~~Holders) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan ~~Holder(s)~~ Holders constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and any related Serviced Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code for federal income tax purposes at any time that any ~~of the~~ Lower-Tier Regular ~~Interests, the 000 Xxxxx Xxxxxx Regular~~ Interests or ~~the~~ Regular Certificates is are outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related Serviced Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than an REO Property related to an Outside Serviced ~~Mortgage~~ Trust Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan ~~Holder(s)~~ Holders (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan ~~Holder(s)~~ Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Serviced Companion Loan ~~Holder(s)~~ Holder (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan ~~Holder(s)~~Holder, constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be entitled ~~(a) with respect to each~~ “Midland Loan Services, a Division of ~~the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination)~~PNC Bank, ~~“[Name of Special Servicer]~~National Association, as Special Servicer, on behalf of ~~Wilmington Trust,~~ U.S. Bank National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage ~~Trust 2019-C7~~Securities Inc., Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2014-C7GC19, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan HoldersHolder, as their interests may appear--], REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two~~ one (21) Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith business judgment, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related ~~Collection~~ Prepayment Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, ~~any~~ the related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced ~~Mortgage~~ Trust Loan.

Appears in 2 contracts

Samples: Pooling and Servicing Agreement (GS Mortgage Securities Trust 2014-Gc22), Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2014-Gc19)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan) is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the ~~applicable~~ Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by deed-in-lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and any related Serviced Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code at any time that any of the Lower-Tier Regular ~~Interests, the 000 Xxxxx Xxxxxx Regular~~ Interests or any of the Regular Certificates is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related Serviced Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than an REO Property related to an Outside Serviced Mortgage Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion ~~Loan(s)~~Loan)), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion ~~Loan(s)~~Loan)) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be entitled ~~(a) with respect to each~~ “Midland Loan Services, a Division of ~~the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination)~~PNC Bank, ~~“[Name of Special Servicer]~~National Association, as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust ~~2019~~2017-C7C4, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2017-C7C4, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan HoldersHolder, as their interests may appear--], REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO Account, within two (2) Business Days after receipt of properly identified funds, all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date (but not earlier than two (2) Business Days after such amounts are received and properly identified) the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related Collection Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, any related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.

Appears in 2 contracts

Samples: Pooling and Servicing Agreement (Wells Fargo Commercial Mortgage Trust 2017-C41), Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2017-C4)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property ~~(other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan)~~ is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to ~~a Serviced Loan Combination~~the Whole Loan, for the benefit of the ~~applicable~~ Certificateholders and the ~~related Serviced~~ Companion Loan ~~Holder(s)~~Holder) (as a collective whole as if such Certificateholders and, if applicable, ~~such Serviced~~ the Companion Loan ~~Holder(s)~~ Holder constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and ~~any related Serviced~~ the Companion Loan ~~Holders~~Holder. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code for federal income tax purposes at any time that any ~~of the~~ Lower-Tier Regular ~~Interests, the 000 Xxxxx Xxxxxx Regular~~ Interests or ~~the~~ Regular Certificates is are outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holder~~Fund, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the ~~related Serviced~~ Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property ~~(other than an REO Property related to an Outside Serviced Mortgage Loan)~~ as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the ~~related Serviced~~ Companion Loan ~~Holder(s)~~ Holder (as a collective whole as if such Certificateholders and, if applicable, the ~~related Serviced~~ Companion Loan ~~Holder(s)~~ Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the ~~related~~ Companion Loan ~~Holder(s)~~ Holder (as a collective whole as if such Certificateholders and, if applicable, the ~~related~~ Companion Loan ~~Holder(s),~~ Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced~~ “Torchlight Loan ~~Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination)~~Services, ~~“[Name of Special Servicer]~~LLC, as Special Servicer, ~~on behalf of Wilmington Trust,~~ in trust for Deutsche Bank National ~~Association~~Trust Company, as Trustee, in trust for ~~the benefit of the registered~~ Holders of ~~Citigroup Commercial~~ GS Mortgage ~~Trust 2019-C7~~Securities Corporation II, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2011-~~C7, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION:~~ GC5 and the ~~related Serviced~~ Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--Holder REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues ~~and proceeds~~ received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds, which shall be remitted to the Collection Account), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five ~~(5)~~ Business Days (or, in an emergency situation or on an urgent basis, two ~~(2)~~ Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith judgment, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its ~~good faith business~~ commercially reasonable judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection ~~Account, or,~~ Account or for ~~a Serviced Loan Combination~~the Whole Loan, the ~~related~~ Whole Loan ~~Combination~~ Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from each REO Property during the related ~~Collection~~ Prepayment Period, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or ~~Serviced~~ the Whole Loan ~~Combination~~ became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, ~~any related Serviced~~ the Whole Loan Directing Holder (with respect to the Whole Loan, for so long as the Companion Loan Holder or its designee is the Whole Loan Directing Holder), the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust ~~Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder~~Fund) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, ~~any related Serviced~~ the Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the ~~Trustee and~~ Trustee, the Certificate Administrator and the ~~related Serviced~~ Companion Loan Holder ~~(or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. ~~(d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.~~

Appears in 2 contracts

Samples: Pooling and Servicing Agreement (GS Mortgage Securities Trust 2011-Gc5), Pooling and Servicing Agreement (GS Mortgage Securities Trust 2011-Gc5)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property ~~(other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan)~~ is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a ~~Serviced Loan Combination~~Whole Loan, for the benefit of the ~~applicable~~ Certificateholders and the related ~~Serviced~~ Companion Loan ~~Holder(s)~~Holders) (as a collective whole as if such Certificateholders ~~and, if applicable, such Serviced~~ and Companion Loan ~~Holder(s)~~ Holders constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and ~~any~~ the related ~~Serviced~~ Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the related Loan REMIC or the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the related Loan REMIC or the Lower-Tier ~~REMIC or the 000 Xxxxx Xxxxxx~~ REMIC, as applicable, of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of any Trust REMIC, or cause any Trust REMIC to fail to qualify as a REMIC under the Code for federal income tax purposes at any time that any ~~of the~~ Loan REMIC Regular Interests, Lower-Tier Regular ~~Interests, the 000 Xxxxx Xxxxxx Regular~~ Interests or ~~the~~ Regular Certificates is are outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related ~~Serviced~~ Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of any Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon any Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property ~~(other than an REO Property related to an Outside Serviced Mortgage Loan)~~ as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan ~~Holder(s)~~ Holders (as a collective whole as if such Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan ~~Holder(s)~~ Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan ~~Holder(s)~~ Holder (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan ~~Holder(s),~~ Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled ~~(a) with respect to each~~ “Midland Loan Services, a Division of ~~the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination)~~PNC Bank, ~~“[Name of Special Servicer]~~National Association, as Special Servicer, ~~on behalf of Wilmington Trust,~~ in trust for Deutsche Bank National ~~Association~~Trust Company, as Trustee, in trust for ~~the benefit of the registered~~ Holders of ~~Citigroup Commercial~~ GS Mortgage ~~Trust 2019-C7~~Securities Corporation II, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2012-~~C7, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION:~~ GCJ7 and the various related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--, REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues ~~and proceeds~~ received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds, which shall be remitted to the Collection Account or related Whole Loan Custodial Account, as applicable), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on any Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five ~~(5)~~ Business Days (or, in an emergency situation or on an urgent basis, two ~~(2)~~ Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith judgment, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection ~~Account,~~ Account or, for a ~~Serviced Loan Combination~~Whole Loan, the ~~related~~ Whole Loan ~~Combination~~ Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from each REO Property during the related ~~Collection~~ Prepayment Period, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or ~~Serviced~~ Whole Loan ~~Combination~~ became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, ~~any~~ the related ~~Serviced~~ Whole Loan Directing Holder (with respect to a Whole Loan, for so long as the related Companion Loan Holder or its designee is the related Whole Loan Directing Holder), the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust ~~Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder~~Fund) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, ~~any~~ the related ~~Serviced~~ Companion Loan ~~Holder~~ Holders with respect to the operation and management of any such REO Property; ~~and (iv)~~ and the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the ~~Trustee and~~ Trustee, the Certificate Administrator and the related ~~Serviced~~ Companion Loan ~~Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ Holders a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. ~~(d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.~~

Appears in 2 contracts

Samples: Pooling and Servicing Agreement (GS Mortgage Securities Trust 2012-Gcj7), Pooling and Servicing Agreement (GS Mortgage Securities Trust 2012-Gcj7)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan) is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the ~~applicable~~ Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by deed-in-lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and any related Serviced Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code at any time that any ~~of the~~ Lower-Tier Regular ~~Interests, the 000 Xxxxx Xxxxxx Regular~~ Interests or ~~the~~ Regular Certificates is are outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related Serviced Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than an REO Property related to an Outside Serviced Mortgage Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion ~~Loan(s)~~Loan)), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion ~~Loan(s)~~Loan)) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000~~ “Xxxxx ~~Xxxxxx Loan Combination)~~Fargo Bank, ~~“[Name of Special Servicer]~~National Association, as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage ~~Trust 2019-C7~~Securities Inc., Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2016-C7, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7GC36, and the related Serviced Companion Loan ~~Holders~~Holder, as their interests may appear--, REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two~~ one (21) Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related Collection Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, any related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.

Appears in 2 contracts

Samples: Pooling and Servicing Agreement (JPMBB Commercial Mortgage Securities Trust 2016-C1), Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2016-Gc36)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property ~~(other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan)~~ is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the applicable Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a the Trustee, or its nominee ~~of the Trustee~~ (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holders~~Fund. The Special Servicer, on behalf of the Trust Fund, shall ~~sell~~ dispose of any REO Property prior to the close of the third calendar year ~~following~~ beginning after the ~~year in which the Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund acquires ownership of such REO ~~Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1),~~ Property for purposes of ~~Code~~ Section 860G(a)(8)) of the Code, unless (i) the ~~IRS grants (or does not deny)~~ Special Servicer on behalf of the Lower-Tier REMIC has applied for an extension of ~~time (an “REO Extension”~~such period pursuant to Sections 856(e)(3) to and 860G(a)(8)(A) of the Code, in which case the Special Servicer shall sell such REO Property within the applicable extension period or (ii) the Special Servicer ~~obtains~~ seeks and subsequently receives an Opinion of Counsel ~~for~~ (which opinion shall be an expense of the ~~Special Servicer, the Certificate Administrator and the Trustee~~Trust Fund), addressed to the Special ~~Servicer, the Certificate Administrator~~ Servicer and ~~the~~ Trustee, to the effect that the holding by the ~~Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund of such REO Property ~~subsequent to the close of the third calendar year following the year in which such acquisition occurred~~ for an additional specified period will not ~~result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of any Trust REMIC, or~~ cause ~~any Trust REMIC~~ such REO Property to fail to qualify as ~~a REMIC under~~ "foreclosure property" within the meaning of Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of Section 860D(a) of the Code) at any time that any ~~of the Lower-Tier Regular Interests, the 000 Xxxxx Xxxxxx Regular Interests or the Regular Certificates~~ Certificate is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, ~~the Special Servicer~~ in which event such period shall ~~sell such REO Property within such longer period as is permitted~~ be extended by such ~~REO Extension or~~ additional specified period subject to any conditions set forth in such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard~~Fund, shall dispose of any REO Property held by the Trust Fund ~~(i)~~ prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section ~~3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property~~3.18 hereof. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders ~~and, if applicable, the related Serviced Companion Loan Holder,~~ solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) ~~or result in~~ of the ~~receipt by~~ Code (determined without regard to the ~~Trust Fund~~ exception applicable for purposes of ~~any “income from non-permitted assets” within the meaning of Code~~ Section ~~860F(a)(2)(B) or (i) endanger the status of any Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon any Trust REMIC or the Trust Fund~~860D(a)). (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property ~~(other than an REO Property related to an Outside Serviced Mortgage Loan)~~ as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s)))Certificateholders, and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “"net income from foreclosure property,” " within the meaning of ~~Code~~ Section 860G(c)) of the Code, which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the ~~Certificate Administrator~~ Trustee in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “"REO Account”"), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled ~~(a) with respect to each of the~~ "GMAC Commercial Mortgage ~~Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination), “[Name of Special Servicer]~~Corporation, as Special Servicer, ~~on behalf of Wilmington Trust,~~ in trust for LaSalle National ~~Association~~Bank, as Trustee, in trust for ~~the benefit of the registered~~ Holders of ~~Citigroup Commercial~~ GS Mortgage ~~Trust 2019-C7~~Securities Corporation II, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~1998-C7XX XX, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”. ." The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b~~) of this Agreement~~). The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues ~~and proceeds~~ received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds, which shall be remitted pursuant to Section 3.18(e) to the Collection Account), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO ~~Property including, if applicable, the payments of any ground rents in respect of such REO~~ Property; and (iv) any taxes imposed on ~~any Trust~~ the Upper Tier REMIC or Lower-Tier REMIC in respect of net income from foreclosure property in accordance with Section ~~4.05 of this Agreement~~4.05. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iviii) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five ~~(5)~~ Business Days ~~(or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency)~~ prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith judgment, that such Advance would be a Nonrecoverable ~~Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account)~~Advance. If the Master Servicer (or, pursuant to Section 3.22(e), the Special Servicer) does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such ~~Advance unless~~ Advance; and if the Trustee fails to make any such Advance, the Fiscal Agent shall make such Advance, unless in either case, the Trustee or the Fiscal Agent determines that such Advance would be a Nonrecoverable Advance. The Trustee and the Fiscal Agent shall be entitled to rely, conclusively, on any determination by the Master Servicer (or, pursuant to Section 3.22(e), the Special Servicer) that an Advance, if made, would be a Nonrecoverable Advance. In addition, with respect to the One Commerce Square Loan, the Master Servicer shall be entitled to rely, conclusively, on any determination by the Trustee that an Advance, if made, would be a Nonrecoverable Advance. The ~~Trustee~~Trustee and the Fiscal Agent, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall ~~use its good faith business judgment~~be subject to the standards applicable to the Master Servicer hereunder. The Master Servicer (or, pursuant to Section 3.22(e), the Special Servicer), the Trustee or the ~~Trustee~~Fiscal Agent, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section ~~3.06 and/or, if applicable, Section 3.06A of this Agreement~~3.06. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection ~~Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account,~~ Account on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from each REO ~~Property during the related Collection Period~~Property, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan ~~or Serviced Loan Combination~~ became imminent, all within the meaning of ~~Code~~ Section 856(e)(4)(B)) of the Code; or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special ~~Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator~~ Servicer and the Trustee (which opinion shall be an expense of the Trust ~~Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder~~Fund) to the effect that such action will not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of ~~Code~~ Section 860D(a)) of the Code) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s 's acquisition thereof (unless the Special Servicer shall have provided the Trustee ~~and the Certificate Administrator~~ with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section ~~3.16(b~~3.17(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders ~~and, if applicable, any related Serviced Companion Loan Holder~~ with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee ~~and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with ~~Section 3.16(a~~Sections 3.17(a) and ~~Section 3.16(b) of this Agreement~~3.17(b). ~~(d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.~~

Appears in 2 contracts

Samples: Pooling and Servicing Agreement (Commercial Mortgage Pass Through Cert Series 1998 Gl Ii), Pooling and Servicing Agreement (Commercial Mortgage Pass Through Cert Series 1998 Gl Ii)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to ~~an Outside~~ the Non-Serviced Mortgage Loan) is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced ~~Loan Combination~~Whole Loan, for the benefit of the ~~applicable~~ Certificateholders and the related ~~Serviced~~ Companion Loan ~~Holder(s)~~Holders) (as a collective whole as if such Certificateholders ~~and, if applicable, such Serviced~~ and Companion Loan ~~Holder(s)~~ Holders constituted a single lender, taking into account the subordinate nature of the related Subordinate Companion Loan) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and ~~any~~ the related ~~Serviced~~ Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code for federal income tax purposes at any time that any ~~of the~~ Lower-Tier Regular ~~Interests, the 000 Xxxxx Xxxxxx Regular~~ Interests or ~~the~~ Regular Certificates is are outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related ~~Serviced~~ Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than ~~an REO Property related~~ with respect to ~~an Outside~~ the Non-Serviced Mortgage Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan ~~Holder(s)~~ Holders (as a collective whole as if such Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan ~~Holder(s)~~ Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination~~lender, taking into account the subordinate nature of ~~any~~ the related Subordinate Companion ~~Loan(s))~~Loan), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan ~~Holder(s)~~ Holder (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan ~~Holder(s),~~ Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination~~lender, taking into account the subordinate nature of ~~any~~ the related Subordinate Companion ~~Loan(s))~~Loan) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer ~~and/or~~ or the Trustee) shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination),~~ “[~~Name of~~ LNR Partners, LLC] [the applicable Special Servicer], as Special Servicer, on behalf of ~~Wilmington Trust~~Wxxxx Fargo Bank, National Association, as Trustee, for the ~~benefit of the~~ registered Holders of ~~Citigroup Commercial~~ GS Mortgage ~~Trust 2019-C7~~Securities Corporation II, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2014-~~C7,~~ GC20 [IN THE CASE OF AN REO PROPERTY RELATED TO A ~~SERVICED LOAN COMBINATION~~WHOLE LOAN: and the related ~~Serviced~~ Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan HoldersHolder, as their interests may appear--], REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two~~ one (21) Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues ~~and proceeds~~ received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds, which shall be remitted to the Collection Account), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced ~~Loan Combination~~Whole Loan, the related Serviced Whole Loan ~~Combination~~ Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from each REO Property during the related ~~Collection~~ Prepayment Period, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Whole Loan ~~Combination~~ became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, ~~any~~ the related ~~Serviced~~ Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if ~~any~~ the related ~~Serviced~~ Companion Loan is part of a REMIC, the related ~~Serviced~~ Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, ~~any~~ the related ~~Serviced~~ Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related ~~Serviced~~ Companion Loan Holder ~~(or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to ~~an Outside~~ the Non-Serviced Mortgage Loan.

Appears in 2 contracts

Samples: Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2014-Gc21), Pooling and Servicing Agreement (GS Mortgage Securities Trust 2014-Gc20)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property ~~(other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan)~~ is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a ~~Serviced Loan Combination~~Whole Loan, for the benefit of the ~~applicable~~ Certificateholders and the related ~~Serviced~~ Companion Loan ~~Holder(s)~~Holders) (as a collective whole as if such Certificateholders ~~and, if applicable, such Serviced~~ and Companion Loan ~~Holder(s)~~ Holders constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and ~~any~~ the related ~~Serviced~~ Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of any Trust REMIC, or cause any Trust REMIC to fail to qualify as a REMIC under the Code for federal income tax purposes at any time that any ~~of the~~ Lower-Tier Regular ~~Interests, the 000 Xxxxx Xxxxxx Regular~~ Interests or ~~the~~ Regular Certificates is are outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related ~~Serviced~~ Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of any Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon any Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property ~~(other than an REO Property related to an Outside Serviced Mortgage Loan)~~ as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan ~~Holder(s)~~ Holders (as a collective whole as if such Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan ~~Holder(s)~~ Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan ~~Holder(s)~~ Holder (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan ~~Holder(s),~~ Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be entitled ~~(a) with respect to each~~ “Midland Loan Services, a Division of ~~the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination)~~PNC Bank, ~~“[Name of Special Servicer]~~National Association, as Special Servicer, on behalf of ~~Wilmington Trust,~~ U.S. Bank National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage ~~Trust 2019-C7~~Securities Inc., Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2012-~~C7,~~ GC8 [IN THE CASE OF AN REO PROPERTY RELATED TO A ~~SERVICED LOAN COMBINATION~~WHOLE LOAN: and the related ~~Serviced~~ Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan HoldersHolder, as their interests may appear--], REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on any Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five ~~(5)~~ Business Days (or, in an emergency situation or on an urgent basis, two ~~(2)~~ Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith judgment, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection ~~Account,~~ Account or, for a ~~Serviced Loan Combination~~Whole Loan, the related Whole Loan ~~Combination~~ Custodial Account, on a monthly basis ~~prior to~~ no later than the ~~related Master Servicer Remittance Date (but not earlier than two (2)~~ Business ~~Days after such amounts are received and properly identified)~~ Day following the end of the Prepayment Period of receipt the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during ~~the related Collection~~ each Prepayment Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or ~~Serviced~~ Whole Loan ~~Combination~~ became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, ~~any~~ the related ~~Serviced~~ Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if ~~any~~ the related ~~Serviced~~ Companion Loan is part of a REMIC, the related ~~Serviced~~ Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, ~~any~~ the related ~~Serviced~~ Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the ~~Trustee and~~ Trustee, the Certificate Administrator and the related ~~Serviced~~ Companion Loan Holder ~~(or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. ~~(d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.~~

Appears in 2 contracts

Samples: Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2012-Gc8), Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2012-Gc8)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to an Outside Serviced ~~Mortgage~~ Trust Loan) is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the ~~applicable~~ Certificateholders and the related Serviced Companion Loan ~~Holder(s)~~Holders) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan ~~Holder(s)~~ Holders constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and any related Serviced Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code for federal income tax purposes at any time that any ~~of the~~ Lower-Tier Regular ~~Interests, the 000 Xxxxx Xxxxxx Regular~~ Interests or ~~the~~ Regular Certificates is are outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related Serviced Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than an REO Property related to an Outside Serviced ~~Mortgage~~ Trust Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan ~~Holder(s)~~ Holders (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan ~~Holder(s)~~ Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Serviced Companion Loan ~~Holder(s)~~ Holder (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan ~~Holder(s)~~Holder, constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be entitled ~~(a) with respect to each~~ “Midland Loan Services, a Division of ~~the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination)~~PNC Bank, ~~“[Name of Special Servicer]~~National Association, as Special Servicer, on behalf of ~~Wilmington Trust, National Association~~Deutsche Bank Trust Company Americas, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage ~~Trust 2019-C7~~Securities Inc., Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2014-C7GC25, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan HoldersHolder, as their interests may appear--], REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two~~ one (21) Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith business judgment, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related ~~Collection~~ Prepayment Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, ~~any~~ the related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced ~~Mortgage~~ Trust Loan.

Appears in 2 contracts

Samples: Pooling and Servicing Agreement (GS Mortgage Securities Trust 2014-Gc26), Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2014-Gc25)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property ~~(other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan)~~ is acquired for the benefit of ~~the applicable~~ Certificateholders ~~(or, with respect to a Serviced Loan Combination, for the benefit of the applicable Certificateholders and the related Serviced Companion Loan Holder(s))~~ (as a collective whole as if such Certificateholders ~~and, if applicable, such Serviced Companion Loan Holder(s)~~ constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holders~~Fund. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code for federal income tax purposes at any time that any ~~of the~~ Lower-Tier Regular ~~Interests, the 000 Xxxxx Xxxxxx Regular~~ Interests or ~~the~~ Regular Certificates is are outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holder~~Fund, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders ~~and, if applicable, the related Serviced Companion Loan Holder,~~ solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property ~~(other than an REO Property related to an Outside Serviced Mortgage Loan)~~ as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders ~~and, if applicable, the related Serviced Companion Loan Holder(s)~~ (as a collective whole as if such Certificateholders ~~and, if applicable, the related Serviced Companion Loan Holder(s)~~ constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))),~~ lender) and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders ~~and, if applicable, the related Companion Loan Holder(s)~~ (as a collective whole as if such Certificateholders ~~and, if applicable, the related Companion Loan Holder(s),~~ constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination),~~ “[~~Name of~~ Rialto Capital Advisors, LLC] [the applicable Special Servicer], as Special Servicer, on behalf of ~~Wilmington Trust, National Association~~Deutsche Bank Trust Company Americas, as Trustee, for the ~~benefit of the~~ registered Holders of ~~Citigroup Commercial~~ GS Mortgage ~~Trust 2019-C7~~Securities Corporation II, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2013-C7GCJ12, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two~~ one (21) Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues ~~and proceeds~~ received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds, which shall be remitted to the Collection Account), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith business judgment, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 ~~and/or, if applicable, Section 3.06A~~ of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, ~~or, for a Serviced Loan Combination, the related Loan Combination Custodial Account,~~ on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from each REO Property during the related ~~Collection~~ Prepayment Period, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan ~~or Serviced Loan Combination~~ became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, ~~any related Serviced Companion Loan Holder,~~ the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust ~~Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder~~Fund) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders ~~and, if applicable, any related Serviced Companion Loan Holder~~ with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator ~~and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. ~~(d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.~~

Appears in 2 contracts

Samples: Pooling and Servicing Agreement (GS Mortgage Securities Trust 2013-Gcj12), Pooling and Servicing Agreement (GS Mortgage Securities Trust 2013-Gcj12)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to ~~an Outside~~ the Non-Serviced Mortgage Loan) is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced ~~Loan Combination~~Whole Loan, for the benefit of the ~~applicable~~ Certificateholders and the related ~~Serviced~~ Companion Loan ~~Holder(s)~~Noteholders) (as a collective ~~whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender~~whole) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a the Trustee, or its nominee ~~of the Trustee~~ (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and ~~any~~ the related ~~Serviced~~ Companion Loan ~~Holders~~Noteholders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of ~~Code~~ Section 860G(a)(8)) of the Code, unless the Special Servicer either (i) ~~the IRS grants (or does not deny)~~ is granted an extension of time (an “"REO Extension”") by the Internal Revenue Service to sell such REO Property or (ii) obtains for the ~~Special~~ Trustee and the Master Servicer ~~obtains~~ an Opinion of ~~Counsel for the Special Servicer, the Certificate Administrator and the Trustee~~Counsel, addressed to the ~~Special Servicer, the Certificate Administrator~~ Trustee and the ~~Trustee~~Master Servicer, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “"prohibited transactions” " (as defined in ~~Code~~ Section ~~860F~~860F of the Code) of ~~any Trust~~ the Lower-Tier REMIC or the Upper-Tier REMIC, or cause ~~any Trust~~ the Lower-Tier REMIC or the Upper-Tier REMIC to fail to qualify as a REMIC ~~under the Code~~ at any time that any Lower-Tier Regular Interests or Certificates are outstanding. In the case of the Trust's beneficial interest in a Mortgaged Property acquired under the Other Pooling Agreement, the Special Servicer shall coordinate with the Other Special Servicer with respect to any REO Extension on behalf of the Lower-Tier ~~Regular Interests, the 000 Xxxxx Xxxxxx Regular Interests or the Regular Certificates is outstanding~~REMIC. If the Special Servicer is granted ~~(or is not denied)~~ the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its ~~receiving~~ being granted the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding ~~sentence~~ sentence, shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a~~) of this Agreement~~). The Special Servicer, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard~~Fund, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section ~~3.17 of this Agreement~~ 3.18 hereof and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan ~~Holder~~Noteholder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) of the Code or result in the receipt by the Trust Fund of any “"income from non-permitted assets” " within the meaning of ~~Code~~ Section 860F(a)(2)(B) of the Code or (i) endanger the status of ~~any Trust~~ the Lower-Tier REMIC or the Upper-Tier REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any Trust~~ the Lower-Tier REMIC or the Upper-Tier REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than ~~an REO Property related~~ with respect to ~~an Outside~~ the Non-Serviced Mortgage Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders ~~and, if applicable,~~ and the related ~~Serviced~~ Companion Loan ~~Holder(s)~~ Noteholders (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))whole), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “"net income from foreclosure property,” " within the meaning of ~~Code~~ Section 860G(c)) of the Code, which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the ~~Certificate Administrator~~ Trustee in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders ~~and, if applicable,~~ and the related Companion Loan ~~Holder(s)~~ Noteholders (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))whole) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “"REO Account”"), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled (a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination), “[Name of Special Servicer]"CWCapital Asset Management LLC, as Special Servicer, ~~on behalf of Wilmington Trust~~in trust for Wells Fargo Bank, ~~National Association~~N.A., as Trustee, in trust for ~~the benefit of the registered~~ Holders of ~~Citigroup Commercial~~ GS Mortgage ~~Trust 2019-C7~~Xxxxrities Corporation II, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2006-~~C7, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION:~~ GG8 and the ~~related Serviced~~ various Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--Noteholders REO Account”. ." The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b~~) of this Agreement~~). The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues ~~and proceeds~~ received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds, which shall be remitted to the Collection Account), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO ~~Property including, if applicable, the payments of any ground rents in respect of such REO~~ Property; and (iv) any taxes imposed on ~~any Trust~~ the Upper-Tier REMIC or Lower-Tier REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date (but not earlier than two (2) Business Days after such amounts are received and properly identified) the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related Collection Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, any related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification4.05. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.

Appears in 2 contracts

Samples: Pooling and Servicing Agreement (GS Mortgage Securities Trust 2006-Gg8), Pooling and Servicing Agreement (GS Mortgage Securities Trust 2006-Gg8)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to ~~an Outside~~ a Non-Serviced ~~Mortgage~~ Trust Loan) is acquired for the benefit of ~~the applicable~~ Certificateholders ~~(or, with respect to a Serviced Loan Combination, for the benefit of the applicable Certificateholders and the related Serviced Companion Loan Holder(s))~~ (as a collective whole as if such Certificateholders ~~and, if applicable, such Serviced Companion Loan Holder(s)~~ constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holders~~Fund. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code for federal income tax purposes at any time that any ~~of the~~ Lower-Tier Regular ~~Interests, the 000 Xxxxx Xxxxxx Regular~~ Interests or ~~the~~ Regular Certificates is are outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holder~~Fund, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the ~~Certificateholders and, if applicable, the related Serviced Companion Loan Holder~~Certificateholders, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than ~~an REO Property related~~ with respect to ~~an Outside~~ the Non-Serviced ~~Mortgage Loan~~Trust Loans) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders ~~and, if applicable, the related Serviced Companion Loan Holder(s)~~ (as a collective whole as if such Certificateholders ~~and, if applicable, the related Serviced Companion Loan Holder(s)~~ constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders ~~and, if applicable, the related Companion Loan Holder(s)~~ (as a collective whole as if such Certificateholders ~~and, if applicable, the related Companion Loan Holder(s),~~ constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination),~~ “[~~Name of~~ Rialto Capital Advisors, LLC] [the applicable Special Servicer], as Special Servicer, on behalf of ~~Wilmington Trust,~~ U.S. Bank National Association, as Trustee, for the ~~benefit of the~~ registered Holders of ~~Citigroup Commercial~~ GS Mortgage ~~Trust 2019-C7~~Securities Corporation II, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2012-C7GCJ9, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two~~ one (21) Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues ~~and proceeds~~ received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds, which shall be remitted to the Collection Account), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith business judgment, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 ~~and/or, if applicable, Section 3.06A~~ of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection ~~Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account,~~ Account on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from each REO Property during the related ~~Collection~~ Prepayment Period, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan ~~or Serviced Loan Combination~~ became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, ~~any related Serviced Companion Loan Holder,~~ the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust ~~Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder~~Fund) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders ~~and, if applicable, any related Serviced Companion Loan Holder~~ with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator ~~and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to ~~an Outside~~ a Non-Serviced ~~Mortgage~~ Trust Loan.

Appears in 2 contracts

Samples: Pooling and Servicing Agreement (GS Mortgage Securities Trust 2012-Gcj9), Pooling and Servicing Agreement (GS Mortgage Securities Trust 2012-Gcj9)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to an Outside Serviced ~~Mortgage~~ Trust Loan) is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the ~~applicable~~ Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and any related Serviced Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code for federal income tax purposes at any time that any ~~of the~~ Lower-Tier Regular ~~Interests, the 000 Xxxxx Xxxxxx Regular~~ Interests or ~~the~~ Regular Certificates is are outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related Serviced Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than an REO Property related to an Outside Serviced ~~Mortgage~~ Trust Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan ~~Holder(s)~~ Holder (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan ~~Holder(s)~~ Holder constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion ~~Loan(s)~~Loan)), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Serviced Companion Loan ~~Holder(s)~~ Holder (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan ~~Holder(s)~~Holder, constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion ~~Loan(s)~~Loan)) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be entitled ~~(a) with respect to each~~ “Midland Loan Services, a Division of ~~the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination)~~PNC Bank, ~~“[Name of Special Servicer]~~National Association, as Special Servicer, on behalf of ~~Wilmington Trust, National Association~~Deutsche Bank Trust Company Americas, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage ~~Trust 2019-C7~~Securities Inc., Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2015-C7GC27, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan HoldersHolder, as their interests may appear--], REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two~~ one (21) Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith business judgment, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related ~~Collection~~ Prepayment Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, any related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced ~~Mortgage~~ Trust Loan.

Appears in 2 contracts

Samples: Pooling and Servicing Agreement (Wells Fargo Commercial Mortgage Trust 2015-C27), Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2015-Gc27)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property ~~(other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan)~~ is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to ~~a Serviced~~ the Loan Combination, for the benefit of the ~~applicable~~ Certificateholders and the ~~related Serviced Companion Loan Holder(s)~~Non-Trust Mortgage Interest Holder) (as a collective whole as if such Certificateholders and, if applicable, ~~such Serviced Companion Loan Holder(s)~~ the Non-Trust Mortgage Interest Holder constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and ~~any related Serviced Companion Loan Holders~~the Non-Trust Mortgage Interest Holder. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code for federal income tax purposes at any time that any ~~of the~~ Lower-Tier Regular ~~Interests, the 000 Xxxxx Xxxxxx Regular~~ Interests or ~~the~~ Regular Certificates is are outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holder~~Fund, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the ~~related Serviced Companion Loan~~ Non-Trust Mortgage Interest Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property ~~(other than an REO Property related to an Outside Serviced Mortgage Loan)~~ as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the ~~related Serviced Companion Loan Holder(s)~~ Non-Trust Mortgage Interest Holder (as a collective whole as if such Certificateholders and, if applicable, the ~~related Serviced Companion Loan Holder(s)~~ Non-Trust Mortgage Interest Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the ~~related Companion Loan Holder(s)~~ Non-Trust Mortgage Interest Holder (as a collective whole as if such Certificateholders and, if applicable, the ~~related Companion Loan Holder(s),~~ Non-Trust Mortgage Interest Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination),~~ “[~~Name of Special Servicer~~_____], as Special Servicer, ~~on behalf of Wilmington Trust, National Association~~in trust for [_____], as Trustee, in trust for ~~the benefit of the registered~~ Holders of ~~Citigroup~~ RBS Commercial ~~Mortgage Trust 2019-C7~~Funding Inc., Commercial Mortgage Pass-Through Certificates, Series ~~2019-C7,~~ 20[__]-[~~IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION:~~ __] and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Non-Trust Mortgage ~~Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--~~Interest Holder REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues ~~and proceeds~~ received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds, which shall be remitted to the Collection Account), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five ~~(5)~~ Business Days (or, in an emergency situation or on an urgent basis, two ~~(2)~~ Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith judgment, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its ~~good faith business~~ commercially reasonable judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection ~~Account, or,~~ Account or for ~~a Serviced~~ the Loan Combination, the ~~related~~ Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from each REO Property during the related ~~Collection~~ Prepayment Period, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or ~~Serviced~~ the Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, ~~any related Serviced Companion~~ the Loan Combination Directing Holder (with respect to the Loan Combination, for so long as the Non-Trust Mortgage Interest Holder or its designee is the Loan Combination Directing Holder), the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust ~~Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder~~Fund) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, ~~any related Serviced Companion Loan~~ the Non-Trust Mortgage Interest Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the ~~Trustee~~ Trustee[, the Certificate Administrator] and the ~~Certificate Administrator and the related Serviced Companion Loan~~ Non-Trust Mortgage Interest Holder ~~(or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. ~~(d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.~~

Appears in 2 contracts

Samples: Pooling and Servicing Agreement (RBS Commercial Funding Inc.), Pooling and Servicing Agreement (RBS Commercial Funding Inc.)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to ~~an Outside~~ a Non-Serviced Mortgage Loan) is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced ~~Loan Combination~~Whole Loan, for the benefit of the ~~applicable~~ Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders ~~and, if applicable, such~~ and Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and ~~any~~ the related ~~Serviced~~ Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code for federal income tax purposes at any time that any ~~of the Lower-Tier Regular Interests, the 000 Xxxxx Xxxxxx Regular Interests or the Regular Certificates~~ Certificate is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related ~~Serviced~~ Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund~~. (b)~~ . The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than ~~an REO Property related~~ with respect to ~~an Outside~~ the Non-Serviced Mortgage ~~Loan~~Loans) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan ~~Holder(s)~~ Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that ~~are~~ it determines in its reasonable business judgment to be substantially consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), ) constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer ~~and/or~~ or the Trustee) shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination)~~“Rialto Capital Advisors, ~~“[Name of Special Servicer]~~LLC, as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the ~~benefit of the~~ registered Holders of ~~Citigroup~~ CSAIL 2015-C2 Commercial Mortgage ~~Trust 2019-C7~~Trust, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2015-~~C7,~~ C2 [~~IN THE CASE OF AN~~ in the case of an REO ~~PROPERTY RELATED TO A SERVICED LOAN COMBINATION~~Property related to a Whole Loan: and the related ~~Serviced~~ Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan HoldersHolder, as their interests may appear--], REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues ~~and proceeds~~ received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds, which shall be remitted to the Collection Account), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to ~~rely, conclusively,~~ rely conclusively on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced ~~Loan Combination~~Whole Loan, the related Serviced Whole Loan ~~Combination~~ Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from each REO Property during the related ~~Collection~~ Prepayment Period, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Whole Loan ~~Combination~~ became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, ~~any~~ the related ~~Serviced~~ Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if ~~any~~ the related ~~Serviced~~ Companion Loan is part of a REMIC, the related ~~Serviced~~ Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section ~~3.16(b~~3.16(a) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, ~~any~~ the related ~~Serviced~~ Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (cb) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related ~~Serviced~~ Companion Loan Holder ~~(or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) ~~and Section 3.16(b)~~ of this Agreement. (dc) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to ~~an Outside~~ a Non-Serviced Mortgage Loan.

Appears in 2 contracts

Samples: Pooling and Servicing Agreement (CSAIL 2015-C3 Commercial Mortgage Trust), Pooling and Servicing Agreement (CSAIL 2015-C2 Commercial Mortgage Trust)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property ~~(other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan)~~ is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the applicable Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of ~~a nominee of~~ the ~~Trustee (which shall not include the Master Servicer)~~Trustee, or ~~a separate trustee or co-trustee~~its nominee, on behalf of the ~~Trust Fund~~ Certificateholders, the Holder of the related Loan REMIC Residual Interest and ~~any~~ itself as Holder of the related ~~Serviced Companion~~ Loan ~~Holders~~REMIC Regular Interest and the Lower-Tier Regular Interests. The Special Servicer, on behalf of the Trust Fund, shall ~~sell~~ dispose of any REO Property prior to the close of the third calendar year ~~following~~ beginning after the year in which the Trust Fund acquires ownership of such REO Property for purposes of Section 860G(a)(8) of the Code, unless (i) the Special Servicer on behalf of the Lower-Tier REMIC or the ~~000 Xxxxx Xxxxxx~~ related Loan REMIC, as applicable, ~~acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1),~~ has applied for ~~purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny)~~ an extension of ~~time (an “REO Extension”~~such period pursuant to Sections 856(e)(3) to and 860G(a)(8)(A) of the Code, in which case the Special Servicer shall sell such REO Property within the applicable extension period or (ii) the Special Servicer ~~obtains~~ seeks and subsequently receives an Opinion of Counsel ~~for~~ (which opinion shall be an expense of the ~~Special Servicer, the Certificate Administrator and the Trustee~~Trust Fund), addressed to the Special ~~Servicer, the Certificate Administrator~~ Servicer and ~~the~~ Trustee, to the effect that the holding by the ~~Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund of such REO Property ~~subsequent to the close of the third calendar year following the year in which such acquisition occurred~~ for an additional specified period will not ~~result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of any Trust REMIC, or~~ cause ~~any Trust REMIC~~ such REO Property to fail to qualify as ~~a REMIC under~~ "foreclosure property" within the meaning of Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of Section 860D(a) of the Code) at any time that any ~~of the Lower-Tier Regular Interests, the 000 Xxxxx Xxxxxx Regular Interests or the Regular Certificates~~ Certificate is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, ~~the Special Servicer~~ in which event such period shall ~~sell such REO Property within such longer period as is permitted~~ be extended by such ~~REO Extension or~~ additional specified period subject to any conditions set forth in such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard~~Fund, shall dispose of any REO Property held by the Trust Fund ~~(i)~~ prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section ~~3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property~~3.18 hereof. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders ~~and, if applicable, the related Serviced Companion Loan Holder,~~ solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) ~~or result in~~ of the ~~receipt by~~ Code (determined without regard to the ~~Trust Fund~~ exception applicable for purposes of ~~any “income from non-permitted assets” within the meaning of Code~~ Section ~~860F(a)(2)(B) or (i) endanger the status of any Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon any Trust REMIC or the Trust Fund~~860D(a)). (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property ~~(other than an REO Property related to an Outside Serviced Mortgage Loan)~~ as are consistent with the ~~Servicing Standard~~ manner in which the Special Servicer manages and operates similar property owned or managed by the ~~terms~~ Special Servicer or any of ~~this Agreement~~its Affiliates, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s)))Certificateholders, and, in connection therewith, the Special Servicer shall ~~only~~ agree to the payment of management fees that are consistent with general market ~~standards or to terms that are more favorable~~standards. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “"net income from foreclosure property,” " within the meaning of ~~Code~~ Section 860G(c)) of the Code, which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the ~~Certificate Administrator~~ Trustee in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “"REO Account”"), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled (a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination), “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, "LaSalle National ~~Association~~Bank, as Trustee, in trust for ~~the benefit of the registered~~ Holders of ~~Citigroup~~ Commercial Mortgage ~~Trust 2019-C7~~Asset Trust, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~1999-C7-C1, ~~[IN THE CASE OF AN~~ REO ~~PROPERTY RELATED TO A SERVICED LOAN COMBINATION:~~ Account." The REO Property and the related ~~Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b)~~ REO Account with respect to the ~~000 Xxxxx Xxxxxx~~ Atlanta Marriott Loan, the DDRA Loan ~~Combination, “[Name of Special Servicer],~~ and the Overland MHP Loan shall be treated as ~~Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit~~ assets of the ~~registered Holders~~ related Loan REMIC for all purposes of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”this Agreement. The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b~~) of this Agreement~~). The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues ~~and proceeds~~ received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO ~~Property including, if applicable, the payments of any ground rents in respect of such REO~~ Property; and (iv) any taxes imposed on ~~any Trust~~ the Upper Tier REMIC, the Lower-Tier REMIC or the related Loan REMIC in respect of net income from foreclosure property in accordance with Section ~~4.05 of this Agreement~~4.05. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iviii) above and the Special Servicer has provided written notice of such shortfall to the ~~Master~~ Servicer at least five ~~(5)~~ Business Days (oror such lesser period as may be necessary, in ~~an emergency situation or~~ the reasonable opinion of the Special Servicer, to prevent a material adverse effect on ~~an urgent basis,~~ any Mortgaged Property but in no event less than two ~~(2)~~ Business Days~~, provided that the written notice sets forth the nature of the emergency or the basis of the urgency~~) prior to the date that such amounts are due, the ~~Master~~ Servicer shall advance the amount of such shortfall unless the ~~Master~~ Servicer determines, in ~~accordance with the Servicing Standard~~its good faith judgment, that such Advance would be a Nonrecoverable Advance; provided, however, the Special Servicer shall make reasonable efforts to request Advances once in any 30 day period to satisfy all such shortfalls. The Special Servicer shall reasonably cooperate with the Servicer in providing any information required to determine whether an Advance (would be a Nonrecoverable Advance and the Servicer shall reasonably cooperate with the Special Servicer in ~~which case such costs shall~~ providing any information required to determine whether an Advance would be ~~an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account)~~a Nonrecoverable Advance. If the ~~Master~~ Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such ~~Advance unless~~ Advance; and if the Trustee fails to make any such Advance, the Fiscal Agent shall make such Advance, unless in either case, the Trustee or the Fiscal Agent determines that such Advance would be a Nonrecoverable Advance. The Trustee and the Fiscal Agent shall be entitled to rely, conclusively, on any determination by the ~~Master~~ Servicer that an Advance, if made, would be a Nonrecoverable Advance. The ~~Trustee~~Trustee and the Fiscal Agent, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall ~~use its good faith business judgment~~be subject to the standards applicable to the Servicer hereunder. The ~~Master Servicer~~ Servicer, the Trustee or the ~~Trustee~~Fiscal Agent, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section ~~3.06 and/or, if applicable, Section 3.06A of this Agreement~~3.06. The Special Servicer shall withdraw from each REO Account and remit to the ~~Master~~ Servicer for deposit into the Collection ~~Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account,~~ Account on a monthly basis prior to or on the related ~~Master Servicer Remittance~~ Due Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from each REO ~~Property during the related Collection Period~~Property, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan ~~or Serviced Loan Combination~~ became imminent, all within the meaning of ~~Code~~ Section 856(e)(4)(B)) of the Code; or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special ~~Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator~~ Servicer and the Trustee (which opinion shall be an expense of the Trust ~~Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder~~Fund) to the effect that such action will not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of ~~Code~~ Section 860D(a)) of the Code) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent ~~Contractor,~~ Contractor the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s 's acquisition thereof (unless the Special Servicer shall have provided the Trustee ~~and the Certificate Administrator~~ with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than ~~thirty~~ 30 days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section ~~3.16(b~~3.17(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders ~~and, if applicable, any related Serviced Companion Loan Holder~~ with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) Promptly following any acquisition by the Trust Fund of an REO Property, the Special Servicer shall obtain an Updated Appraisal thereof, but only in the event that any Appraisal or Updated Appraisal with respect thereto is more than 12 months old, in order to determine the fair market value of such REO Property and shall notify the Depositor, the Servicer and the Trustee hereto of the results of such appraisal. Any such appraisal shall be conducted by an appraiser who is an MAI and the cost thereof shall be an expense of the Trust Fund. The Special Servicer shall obtain a new Updated Appraisal or a letter update every 12 months thereafter. (d) When and as necessary, the Special Servicer shall ~~send~~ deliver to the Trustee ~~and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with ~~Section 3.16(a~~Sections 3.17(a) and ~~Section 3.16(b) of this Agreement~~3.17(b). ~~(d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.~~

Appears in 1 contract

Samples: Pooling and Servicing Agreement (Asset Securitization Corp)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan) is acquired for the benefit of Certificateholders and the ~~applicable Certificateholders~~ Uncertificated VRR Interest Owner (or, with respect to a Serviced Loan Combination, for the benefit of the ~~applicable Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by deed-in-lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and any related Serviced Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code at any time that any of the Lower-Tier Regular Interests, ~~the 000 Xxxxx Xxxxxx Regular Interests or~~ any of the Regular Certificates or the Uncertificated VRR Interest is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, the related Serviced Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than an REO Property related to an Outside Serviced Mortgage Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination)~~“Rialto Capital Advisors, ~~“[Name of Special Servicer]~~LLC, as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7GC43, Commercial Mortgage Pass-Through Certificates, Series 2019-C7GC43, and the Uncertificated VRR Interest Owner [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan ~~Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer~~Holder], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--, REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO Account, within two (2) Business Days after ~~receipt of properly identified funds~~receipt, all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related Collection Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the ~~Certificateholders~~ Certificateholders, the Uncertificated VRR Interest Owner and, if applicable, any related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.

Appears in 1 contract

Samples: Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2019-Gc43)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property ~~(other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan)~~ is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the applicable Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a the Trustee, or its nominee ~~of the Trustee~~ (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holders~~Fund. The Special Servicer, on behalf of the Trust Fund, shall ~~sell~~ dispose of any REO Property ~~prior to~~ within two years after the ~~close of the third calendar year following the year in which the Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund acquires ownership of such REO ~~Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1),~~ Property for purposes of ~~Code~~ Section 860G(a)(8)) of the Code, unless (i) the ~~IRS grants (or does not deny)~~ Special Servicer on behalf of the Lower-Tier REMIC has applied for an extension of ~~time (an “REO Extension”~~such two-year period pursuant to Sections 856(e)(3) to and 860G(a)(8)(A) of the Code, in which case the Special Servicer shall sell such REO Property within the applicable extension period or (ii) the Special Servicer ~~obtains~~ seeks and subsequently receives an Opinion of Counsel ~~for~~ (which opinion shall be an expense of the ~~Special Servicer, the Certificate Administrator and the Trustee~~Trust Fund), addressed to the Special ~~Servicer, the Certificate Administrator~~ Servicer and ~~the~~ Trustee, to the effect that the holding by the ~~Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund of such REO Property ~~subsequent to the close of the third calendar year following the year in which such acquisition occurred~~ for an additional specified period will not ~~result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of any Trust REMIC, or~~ cause ~~any Trust REMIC~~ such REO Property to fail to qualify as ~~a REMIC under~~ "foreclosure property" within the meaning of Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of Section 860D(a) of the Code) at any time that any ~~of the Lower-Tier Regular Interests, the 000 Xxxxx Xxxxxx Regular Interests or the Regular Certificates~~ Certificate is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, ~~the Special Servicer~~ in which event such two-year period shall ~~sell such REO Property within such longer period as is permitted~~ be extended by such ~~REO Extension or~~ additional specified period subject to any conditions set forth in such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard~~Fund, shall dispose of any REO Property held by the Trust Fund ~~(i)~~ prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section ~~3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property~~3.18 hereof. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders ~~and, if applicable, the related Serviced Companion Loan Holder,~~ solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) ~~or result in~~ of the ~~receipt by~~ Code (determined without regard to the ~~Trust Fund~~ exception applicable for purposes of ~~any “income from non-permitted assets” within the meaning of Code~~ Section ~~860F(a)(2)(B) or (i) endanger the status of any Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon any Trust REMIC or the Trust Fund~~860D(a)). (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property ~~(other than an REO Property related to an Outside Serviced Mortgage Loan)~~ as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s)))Certificateholders, and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “"net income from foreclosure property,” " within the meaning of ~~Code~~ Section 860G(c)) of the Code, which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the ~~Certificate Administrator~~ Trustee in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “"REO Account”"), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination), “~~"[~~Name of~~ applicable Special Servicer], ~~as Special Servicer, on behalf of Wilmington Trust,~~ in trust for LaSalle National ~~Association~~Bank, as Trustee, in trust for ~~the benefit of the registered~~ Holders of ~~Citigroup Commercial~~ GS Mortgage ~~Trust 2019-C7~~Securities Corporation II, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~1997-C7GL I, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”. ." The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b~~) of this Agreement~~). The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues ~~and proceeds~~ received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds, which shall be remitted pursuant to Section 3.18(e) to the Collection Account), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO ~~Property including, if applicable, the payments of any ground rents in respect of such REO~~ Property; and (iv) any taxes imposed on ~~any Trust~~ the Upper Tier REMIC, Middle-Tier REMIC or Lower-Tier REMIC in respect of net income from foreclosure property in accordance with Section ~~4.05 of this Agreement~~4.05. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iviii) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five ~~(5)~~ Business Days ~~(or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency)~~ prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith judgment, that such Advance would be a Nonrecoverable ~~Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account)~~Advance. If the Master Servicer (or, pursuant to Section 3.22(e), the Special Servicer) does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such ~~Advance unless~~ Advance; and if the Trustee fails to make any such Advance, the Fiscal Agent shall make such Advance, unless in either case, the Trustee or the Fiscal Agent determines that such Advance would be a Nonrecoverable Advance. The Trustee and the Fiscal Agent shall be entitled to rely, conclusively, on any determination by the Master Servicer (or, pursuant to Section 3.22(e), the Special Servicer) that an Advance, if made, would be a Nonrecoverable Advance. The ~~Trustee~~Trustee and the Fiscal Agent, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall ~~use its good faith business judgment~~be subject to the standards applicable to the Master Servicer hereunder. The Master Servicer (or, pursuant to Section 3.22(e), the Special Servicer), the Trustee or the ~~Trustee~~Fiscal Agent, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section ~~3.06 and/or, if applicable, Section 3.06A of this Agreement~~3.06. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection ~~Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account,~~ Account on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from each REO ~~Property during the related Collection Period~~Property, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan ~~or Serviced Loan Combination~~ became imminent, all within the meaning of ~~Code~~ Section 856(e)(4)(B)) of the Code; or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special ~~Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator~~ Servicer and the Trustee (which opinion shall be an expense of the Trust ~~Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder~~Fund) to the effect that such action will not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of ~~Code~~ Section 860D(a)) of the Code) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s 's acquisition thereof (unless the Special Servicer shall have provided the Trustee ~~and the Certificate Administrator~~ with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section ~~3.16(b~~3.17(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders ~~and, if applicable, any related Serviced Companion Loan Holder~~ with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee ~~and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with ~~Section 3.16(a~~Sections 3.17(a) and ~~Section 3.16(b) of this Agreement~~3.17(b). ~~(d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.~~

Appears in 1 contract

Samples: Pooling and Servicing Agreement (Gs Mortgage Securities Ii Series 1997-Gl I)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property ~~(other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan)~~ is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the applicable Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a the Trustee, or its nominee ~~of the Trustee~~ (which shall not include the ~~Master~~ Servicer), or a separate trustee or co-trustee, on behalf of the Trust ~~Fund~~ Fund. The Special Servicer shall maintain accurate records with respect to each related REO Property reflecting the status of taxes, assessments and ~~any related Serviced Companion Loan Holders~~other similar items that are or may become a lien on such REO Property and the status of insurance premiums payable with respect thereto. The Special Servicer, on behalf of the Trust Fund, shall ~~sell~~ use its best efforts to dispose of any REO Property ~~prior to~~ within two years after the ~~close of the third calendar year following the year in which the Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund acquires ownership of such REO ~~Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1),~~ Property for purposes of ~~Code~~ Section 860G(a)(8)) of the Code, unless (i) the ~~IRS grants (or does not deny)~~ Special Servicer, on behalf of the Lower-Tier REMIC, has applied for and received an extension of ~~time (an “REO Extension”~~such two-year period pursuant to Sections 856(e)(3) to and 860G(a)(8)(A) of the Code, in which case the Special Servicer shall sell such REO Property within the applicable extension period or (ii) the Special Servicer ~~obtains~~ seeks and subsequently receives an Opinion of Counsel ~~for~~ (which opinion shall be an expense of the ~~Special Servicer, the Certificate Administrator and the Trustee~~Trust Fund), addressed to the Special ~~Servicer, the Certificate Administrator~~ Servicer and the Trustee, to the effect that the holding by the ~~Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund of such REO Property ~~subsequent to the close of the third calendar year following the year in which such acquisition occurred~~ for an additional specified period will not ~~result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of any Trust REMIC, or~~ cause ~~any Trust REMIC~~ such REO Property to fail to qualify as ~~a REMIC under~~ "foreclosure property" within the meaning of Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of Section 860D(a) of the Code) at any time that any ~~of the Lower-Tier Regular Interests, the 000 Xxxxx Xxxxxx Regular Interests or the Regular Certificates~~ Certificate is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, in which case the Special Servicer shall sell such REO Property within such ~~longer~~ two-year period as ~~is permitted~~ extended by such ~~REO Extension or~~ additional specified period subject to any conditions set forth in such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard~~Fund, shall use its best efforts to dispose of any REO Property held by the Trust Fund ~~(i)~~ prior to the last day of ~~such~~ the period (taking into account extensions) by within which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section ~~3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property~~3.18. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders ~~and, if applicable, the related Serviced Companion Loan Holder,~~ solely for the purpose of its ~~prompt~~ disposition and sale in a manner which does not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) ~~or result in~~ of the ~~receipt by~~ Code (determined without regard to the ~~Trust Fund~~ exception applicable for purposes of ~~any “income from non-permitted assets” within~~ Section 860D(a)) of the ~~meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of any Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon any Trust REMIC or the Trust Fund~~Code. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property ~~(other than an REO Property related to an Outside Serviced Mortgage Loan)~~ as are consistent with the ~~Servicing Standard~~ manner in which the Special Servicer manages and operates similar property owned or managed by the ~~terms~~ Special Servicer or any of ~~this Agreement~~its Affiliates, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s)))Certificateholders, and, in connection therewith, the Special Servicer shall ~~only~~ agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a taxstandards. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a ~~segregated~~ custodial account (each, an “"REO Account”"), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled (a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination), “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association" , as Trustee, in trust for ~~the benefit of the registered~~ Holders of ~~Citigroup Commercial Mortgage Trust 2019-C7~~, Commercial Mortgage Pass-Through Certificates, Series ~~2019-C7~~, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”. ." The Special Servicer shall be entitled to ~~withdraw for its account~~ any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section ~~3.07(b) of this Agreement~~3.7(b). The Special Servicer shall deposit or cause to be deposited in the related REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all ~~revenues and proceeds~~ REO Proceeds received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of ~~any~~ such REO Property; (ii) all real estate taxes and assessments in respect of ~~any~~ such REO Property that may result in the imposition of a lien thereon;; and (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore ~~any REO Property including, if applicable, the payments of any ground rents in respect of~~ such REO Property~~; and (iv)~~ , including any ~~taxes imposed on any Trust REMIC in respect of net income from foreclosure~~ property ~~in accordance with Section 4.05 of this Agreement~~management fees. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iviii) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are dueabove, the ~~Master~~ Servicer shall ~~advance~~ make an Advance equal to the amount of such shortfall unless the ~~Master~~ Servicer determines, in ~~accordance with the Servicing Standard~~its good faith judgment, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The ~~Trustee shall be entitled to rely, conclusively, on any determination by the Master~~ Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent ~~set forth in~~ permitted pursuant to Section ~~3.06 and/or, if applicable, Section 3.06A of this Agreement~~3.6. The Special Servicer shall ~~withdraw~~ remit to the Servicer from each REO Account ~~and remit to the Master Servicer~~ for deposit ~~into~~ in the Collection ~~Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account,~~ Account on a monthly basis prior to the related ~~Master Servicer~~ Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from ~~each REO Property during~~ the related ~~Collection Period~~REO Property, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in ~~each~~ such REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New ~~Lease,~~ Lease if the New ~~Lease~~ Lease, by its ~~terms~~ terms, will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New ~~Lease,~~ Lease other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ~~ten percent~~ 10% of the construction of such building or other improvement was completed before default on the related Mortgage Loan ~~or Serviced Loan Combination~~ became imminent, all within the meaning of ~~Code~~ Section 856(e)(4)(B)) of the Code; or (iv) Directly Operate or perform any construction work on, or allow any Person (other than an Independent Contractor) to Directly Operate or perform any construction work on, any REO Property on on, any date more than 90 days after its date of acquisition by the Trust Fund~~, unless such Person is an Independent Contractor~~; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special ~~Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator~~ Servicer and the Trustee (which opinion shall be an expense of the Trust ~~Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder~~Fund) to the effect that such action will not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of ~~Code~~ Section 860D(a)) of the Code) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent ~~Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds,~~ Contractor for the operation and management of any REO ~~Property,~~ Property within 90 days of the Trust Fund’s 's acquisition thereof (unless the Special Servicer shall have provided the Trustee ~~and the Certificate Administrator~~ with an Opinion of Counsel that the operation and management of ~~any~~ such REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section ~~3.16(b~~3.17(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders ~~and, if applicable, any related Serviced Companion Loan Holder~~ with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) Promptly following any acquisition by the Trust Fund of an REO Property, the Special Servicer shall obtain (i) an update of any appraisal performed pursuant to Section 3.10 which is more than ____ months old, or (ii) to the extent that an appraisal has not been obtained pursuant to such Section, an appraisal of such REO Property by an Independent appraiser familiar with the area in which such REO Property is located in order to determine the fair market value of such REO Property and shall notify the Depositor and the Trustee of the results of such appraisal. Any such appraisal shall be conducted in accordance with MAI standards and the cost thereof shall be an expense of the Trust Fund. (d) When and as necessary, the Special Servicer shall send to the Trustee ~~and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section ~~3.16(a) and Section 3.16(b) of this Agreement~~3.17(b). ~~(d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.~~

Appears in 1 contract

Samples: Pooling and Servicing Agreement (Commercial Mortgage Acceptance Corp)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property ~~(other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan)~~ is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the applicable Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund in foreclosure or by ~~a single member limited liability company established for that purpose)~~ deed in ~~foreclosure, by deed-in-~~lieu of ~~foreclosure or upon abandonment or reclamation from bankruptcy~~foreclosure, the deed or certificate of sale shall be taken in the name of a the Trustee, or its nominee ~~of the Trustee~~ (which shall not include the Master Servicer or the Special Servicer), or a separate trustee or co-trustee, on behalf of the Trust ~~Fund~~ Fund. The Special Servicer shall maintain accurate records with respect to each related REO Property reflecting the status of taxes, assessments and ~~any related Serviced Companion Loan Holders~~other similar items that are or may become a lien on such REO Property and the status of insurance premiums payable with respect thereto. The Special Servicer, on behalf of the Trust Fund, shall ~~sell~~ dispose of any REO Property ~~prior to~~ within three taxable years after the close of the ~~third calendar year following the~~ taxable year in which the ~~Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund acquires ownership of such REO ~~Property, within~~ Property (the ~~meaning of Treasury Regulations Section 1.856-6(b)(1),~~ "REO Grace Period") for purposes of ~~Code~~ Section 860G(a)(8)) of the Code, unless (i) the ~~IRS grants (or does not deny)~~ Special Servicer, on behalf of REMIC I, has timely applied for and received an extension of ~~time (an “~~such REO ~~Extension”~~Grace Period pursuant to Sections 856(e)(3) to and 860G(a)(8)(A) of the Code, in which case the Special Servicer shall sell such REO Property within the applicable extension period or (ii) the Special Servicer ~~obtains~~ seeks and subsequently receives an Opinion of Counsel ~~for~~ (the ~~Special Servicer~~cost of such opinion shall be advanced as a Servicing Advance, ~~the Certificate Administrator and the Trustee~~unless it would be a Nonrecoverable Advance), addressed to the Special ~~Servicer, the Certificate Administrator~~ Servicer and the Trustee, to the effect that the holding by the ~~Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund of such REO Property ~~subsequent to the close of the third calendar year following the year in which such acquisition occurred~~ for an additional specified period will not ~~result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of any Trust REMIC, or~~ cause ~~any Trust REMIC~~ such REO Property to fail to qualify as ~~a REMIC under~~ "foreclosure property" within the meaning of Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of Section 860D(a) of the Code) at any time that any ~~of the Lower-Tier Regular Interests, the 000 Xxxxx Xxxxxx Regular Interests or the Regular Certificates~~ Certificate is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, in which case the Special Servicer shall sell such REO Property within ~~such longer period as is permitted by such~~ the REO Grace Period (collectively the "REO Extension or Period") as extended by the applicable REO Extension Period subject to any conditions set forth in such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard~~Fund, shall dispose of any REO Property held by the Trust Fund ~~(i)~~ prior to the last day of ~~such~~ the period (taking into account extensions) by within which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section ~~3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property~~3.18. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders ~~and, if applicable, the related Serviced Companion Loan Holder,~~ solely for the purpose of its ~~prompt~~ disposition and sale in a manner which does not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) or of the Code (determined without regard to the exception applicable for purposes of Section 860D(a)) of the Code or, except as contemplated by Section 3.19(d), result in the receipt by ~~the Trust Fund~~ REMIC I of any “"income from non-permitted assets” " within the meaning of ~~Code~~ Section 860F(a)(2)(B) of the Code or ~~(i) endanger the status~~ in an Adverse REMIC Event in respect of any ~~Trust REMIC as a REMIC or (ii) result in~~ of the ~~imposition of a tax upon any Trust REMIC or the Trust Fund~~REMICs. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property ~~(other than an REO Property related to an Outside Serviced Mortgage Loan)~~ as are consistent with ~~the~~ Servicing ~~Standard and the terms of this Agreement~~Standard, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s)))Certificateholders, and, in connection therewith, the Special Servicer shall ~~only~~ agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a taxstandards. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “"REO Account”"), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled (a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination), “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, "LaSalle National ~~Association~~Bank, as Trustee, in trust for ~~the benefit of the registered~~ Holders of ~~Citigroup~~ Commercial Mortgage ~~Trust 2019-C7~~Acceptance Corp., Commercial Mortgage Pass-Through Certificates, Series ~~2019~~1998-C7C1, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”. ." The Special Servicer shall be entitled to ~~withdraw for its account~~ any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section ~~3.07(b) of this Agreement~~3.7(b). The Special Servicer shall deposit or cause to be deposited in the related REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all ~~revenues and proceeds~~ REO Proceeds received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO ~~Property and for other Property Protection Expenses with respect to such REO~~ Property, including: (i) all insurance premiums and ground rents, if any, due and payable in respect of ~~any~~ such REO Property; (ii) all real estate taxes and assessments in respect of ~~any~~ such REO Property and such other Mortgaged Properties that may result in the imposition of a lien thereon;; and (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore ~~any~~ such REO Property ~~including~~and such other Mortgaged Properties, ~~if applicable, the payments of~~ including any ~~ground rents in respect of such REO Property; and (iv) any taxes imposed on any Trust REMIC in respect of net income from foreclosure~~ property ~~in accordance with Section 4.05 of this Agreement~~management fees. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iviii) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are dueabove, the Master Servicer shall ~~advance~~ make an Advance equal to the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith judgment, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The ~~Trustee shall be entitled to rely, conclusively, on any determination by the~~ Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent ~~set forth in~~ permitted pursuant to Section ~~3.06 and/or, if applicable, Section 3.06A of this Agreement~~3.6. The Special Servicer shall ~~withdraw from each REO Account and~~ remit to the Master Servicer from each REO Account for deposit ~~into~~ in the Collection ~~Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account,~~ Account on a monthly basis prior to the related ~~Master Servicer~~ Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from ~~each REO Property during~~ the related ~~Collection Period~~REO Property, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in ~~each~~ such REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall ~~not:~~not (unless permitted pursuant to subsection (d) below): (i) permit the Trust Fund to enter into, renew or extend any New ~~Lease,~~ Lease if the New ~~Lease~~ Lease, by its ~~terms~~ terms, will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New ~~Lease,~~ Lease other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ~~ten percent~~ 10% of the construction of such building or other improvement was completed before default on the related Mortgage Loan ~~or Serviced Loan Combination~~ became imminent, all within the meaning of ~~Code~~ Section 856(e)(4)(B)) of the Code; or (iv) Directly Operate or perform any construction work on, or allow any Person (other than an Independent Contractor) to Directly Operate or perform any construction work on, any REO Property on on, any date more than 90 days after its date of acquisition by the Trust Fund~~, unless such Person is an Independent Contractor~~; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special ~~Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator~~ Servicer and the Trustee (which opinion shall be an expense of the Trust ~~Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder~~Fund) to the effect that such action will not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of ~~Code~~ Section 860D(a)) of the Code) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent ~~Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds,~~ Contractor for the operation and management of any REO ~~Property,~~ Property within 90 days of the Trust Fund’s 's acquisition thereof (unless the Special Servicer shall have provided the Trustee ~~and the Certificate Administrator~~ with an Opinion of Counsel that the operation and management of ~~any~~ such REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) the terms and conditions of any such contract shall reflect an agreement reached at arm's length and shall be consistent with the provisions of Treasury Regulation Section 1.856-4(b)(5); (iii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent ~~Contractor~~Contractor but only to the extent consistent with Section 856 of the Code and Treasury Regulation Section 1.856-4(b)(5); (~~iii~~iv) none of the provisions of this Section ~~3.16(b~~3.17(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders ~~and, if applicable, any related Serviced Companion Loan Holder~~ with respect to the operation and management of any such REO Property; and (ivv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee ~~and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section ~~3.16(a) and Section 3.16(b) of this Agreement~~3.17(b). (d) ~~Notwithstanding anything~~ The Special Servicer shall, prior to acquisitions of title to any Mortgaged Property, review the operations of such property securing a defaulted loan and determine the character of the income that the Trust would realize if the Trust acquired title to such Mortgaged Property. The Special Servicer shall undertake this analysis with a view to retaining the status of the REO Property as foreclosure property under the REMIC provisions while maximizing the net after-tax REO Income received without materially adversely affecting the Special Servicer's ability to sell such REO Property. The Special Servicer shall, in its good faith and reasonable judgment, and as it deems appropriate after consultation with counsel knowledgeable in such matters (with such consultation being an expense of the Trust Fund) determine which of the following alternatives is preferred and commercially feasible. The Special Servicer shall avoid subjecting the income from such Mortgaged Property to tax as either "net income from foreclosure property" or a "prohibited transaction" within the meaning of the REMIC Provisions (an "REO Tax") to the ~~contrary~~maximum extent possible when evaluating the following alternative courses of action: (i) Operate, ~~this Section 3.16 shall~~ or Directly Operate, as defined herein, the Mortgaged Property if none of the income would be subject to an REO tax; or (ii) Contract for operation of the Mortgaged Property through a lease to another party, by contract with an independent Contractor who Directly Operates such property or such other method pursuant to which the Special Servicer would not ~~apply~~ Directly Operate the Mortgaged Property if the income from the Mortgaged Property could otherwise be subject to ~~any~~ a REO tax; or (iii) Directly Operate the mortgaged property if there are no other commercially feasible means of operating such mortgaged property as REO Property ~~related~~ without the Trust potentially or actually incurring an REO Tax; provided, however, that the Special Servicer shall consult with the Trustee regarding the plan of operations, the estimated income (and character thereof) derived therefrom, the estimated amount of taxes payable on such income and such other information as is necessary to make a reasoned judgment as to whether the REO Property will remain a foreclosure property and whether such plan is likely to maximize the net after tax REO income to the Trust. Neither the Special Servicer nor the Trustee shall be liable to the Certificateholders, the Trust or the other parties to this Agreement or each other for errors in judgment made in good faith in the exercise of their discretion while performing their respective responsibilities under this Section. (e) Promptly following any acquisition by the Trust Fund of an ~~Outside Serviced Mortgage Loan~~REO Property, the Special Servicer shall obtain (i) an update of any appraisal performed pursuant to Section 3.23 which is more than 12 months old, or (ii) to the extent that an appraisal has not been obtained pursuant to such Section, an appraisal of such REO Property by an Independent appraiser familiar with the area in which such REO Property is located in order to determine the fair market value of such REO Property and shall notify the Depositor and the Trustee of the results of such appraisal. Any such appraisal shall be conducted in accordance with MAI standards by an appraiser with at least 10 years experience in the relevant property type and in the jurisdiction in which the Mortgaged Property is located and the cost thereof shall be an expense of the Trust Fund.

Appears in 1 contract

Samples: Pooling and Servicing Agreement (Commercial Mortgage Pass Through Certificates Series 1998 C1)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property ~~(other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan)~~ is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the applicable Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a the Trustee, or its nominee ~~of the Trustee~~ (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holders~~Fund. The Special Servicer, on behalf of the Trust Fund, shall ~~sell~~ dispose of any REO Property prior to the close of the third calendar year following the year in which the ~~Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund acquires ownership of such REO ~~Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1),~~ Property for purposes of ~~Code~~ Section 860G(a)(8)) of the Code, unless (i) the ~~IRS grants (or does not deny)~~ Special Servicer on behalf of the Lower-Tier REMIC has applied for an extension of ~~time (an “REO Extension”~~such period pursuant to Sections 856(e)(3) to and 860G(a)(8)(A) of the Code, in which case the Special Servicer shall sell such REO Property within the applicable extension period or (ii) the Special Servicer ~~obtains~~ seeks and subsequently receives an Opinion of Counsel ~~for~~ (which opinion shall be an expense of the ~~Special Servicer, the Certificate Administrator and the Trustee~~Trust Fund), addressed to the Special ~~Servicer, the Certificate Administrator~~ Servicer and ~~the~~ Trustee, to the effect that the holding by the ~~Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund of such REO Property ~~subsequent to the close of the third calendar year following the year in which such acquisition occurred~~ for an additional specified period will not ~~result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of any Trust REMIC, or~~ cause ~~any Trust REMIC~~ such REO Property to fail to qualify as ~~a REMIC under~~ "foreclosure property" within the meaning of Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of Section 860D(a) of the Code) at any time that any ~~of the Lower-Tier Regular Interests, the 000 Xxxxx Xxxxxx Regular Interests or the Regular Certificates~~ Certificate is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, ~~the Special Servicer~~ in which event such period shall ~~sell such REO Property within such longer period as is permitted~~ be extended by such ~~REO Extension or~~ additional specified period subject to any conditions set forth in such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard~~Fund, shall dispose of any REO Property held by the Trust Fund ~~(i)~~ prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section ~~3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property~~3.18 hereof. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders ~~and, if applicable, the related Serviced Companion Loan Holder,~~ solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) ~~or result in~~ of the ~~receipt by~~ Code (determined without regard to the ~~Trust Fund~~ exception applicable for purposes of ~~any “income from non-permitted assets” within the meaning of Code~~ Section ~~860F(a)(2)(B) or (i) endanger the status of any Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon any Trust REMIC or the Trust Fund~~860D(a)). (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property ~~(other than an REO Property related to an Outside Serviced Mortgage Loan)~~ as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s)))Certificateholders, and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more ~~favorable~~favorable to the Trust Fund. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “"net income from foreclosure property,” " within the meaning of ~~Code~~ Section 860G(c)) of the Code, which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the ~~Certificate Administrator~~ Trustee in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “"REO Account”"), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan)~~ "Clarion Partners, LLC, in trust for State Street Bank and ~~any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination), “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association~~Trust Company, as Trustee, in trust for ~~the benefit of the registered~~ Holders of ~~Citigroup Commercial Mortgage Trust 2019-C7~~Xxxxxx Xxxxxxx Capital I Inc., Commercial Mortgage Pass-Through Certificates, Series ~~2019~~1998-C7XL1, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”. ." The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b~~) of this Agreement~~). The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues ~~and proceeds~~ received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds, which shall be remitted pursuant to Section 3.18(e) to the Collection Account), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO ~~Property including, if applicable, the payments of any ground rents in respect of such REO~~ Property; and (iv) any taxes imposed on ~~any Trust~~ the Upper Tier REMIC or Lower-Tier REMIC in respect of net income from foreclosure property in accordance with Section ~~4.05 of this Agreement~~4.05. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iviii) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five ~~(5)~~ Business Days ~~(or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency)~~ prior to the date that such amounts are due, the Master Servicer shall ~~advance~~ pay as a Property Advance the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith judgment, that such Advance would be a Nonrecoverable ~~Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account)~~Advance. If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such ~~Advance~~ Advance, unless in either case, the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall ~~use its good faith business judgment~~be subject to the standards applicable to the Master Servicer hereunder. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section ~~3.06 and/or, if applicable, Section 3.06A of this Agreement~~3.06. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection ~~Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account,~~ Account on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from each REO ~~Property during the related Collection Period~~Property, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan ~~or Serviced Loan Combination~~ became imminent, all within the meaning of ~~Code~~ Section 856(e)(4)(B)) of the Code; or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special ~~Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator~~ Servicer and the Trustee (which opinion shall be an expense of the Trust ~~Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder~~Fund) to the effect that such action will not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of ~~Code~~ Section 860D(a)) of the Code) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s 's acquisition thereof (unless the Special Servicer shall have provided the Trustee ~~and the Certificate Administrator~~ with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section ~~3.16(b~~3.17(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders ~~and, if applicable, any related Serviced Companion Loan Holder~~ with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee ~~and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with ~~Section 3.16(a~~Sections 3.17(a) and ~~Section 3.16(b) of this Agreement~~3.17(b). ~~(d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.~~

Appears in 1 contract

Samples: Pooling and Servicing Agreement (Morgan Stanley Cap I Inc Comm Mort Pass THR Cer Ser 1998 Xl2)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to ~~an Outside~~ the Non-Serviced Mortgage Loan) is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced ~~Loan Combination~~Whole Loan, for the benefit of the ~~applicable~~ Certificateholders and the related ~~Serviced~~ Companion Loan ~~Holder(s)~~Noteholders) (as a collective ~~whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender~~whole) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a the Trustee, or its nominee ~~of the Trustee~~ (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and ~~any~~ the related ~~Serviced~~ Companion Loan ~~Holders~~Noteholders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of ~~Code~~ Section 860G(a)(8)) of the Code, unless the Special Servicer either (i) ~~the IRS grants (or does not deny)~~ is granted an extension of time (an “"REO Extension”") by the Internal Revenue Service to sell such REO Property or (ii) obtains for the ~~Special~~ Trustee and the Master Servicer ~~obtains~~ an Opinion of ~~Counsel for the Special Servicer, the Certificate Administrator and the Trustee~~Counsel, addressed to the ~~Special Servicer, the Certificate Administrator~~ Trustee and the ~~Trustee~~Master Servicer, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “"prohibited transactions” " (as defined in ~~Code~~ Section ~~860F~~860F of the Code) of ~~any Trust~~ the Lower-Tier REMIC or the Upper-Tier REMIC, or cause ~~any Trust~~ the Lower-Tier REMIC or the Upper-Tier REMIC to fail to qualify as a REMIC ~~under the Code~~ at any time that any Lower-Tier Regular Interests or Certificates are outstanding. In the case of the Trust's beneficial interest in a Mortgaged Property acquired under the Other Pooling Agreement, the Special Servicer shall coordinate with the Other Special Servicer with respect to any REO Extension on behalf of the Lower-Tier ~~Regular Interests, the 000 Xxxxx Xxxxxx Regular Interests or the Regular Certificates is outstanding~~REMIC. If the Special Servicer is granted ~~(or is not denied)~~ the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its ~~receiving~~ being granted the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding ~~sentence~~ sentence, shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a~~) of this Agreement~~). The Special Servicer, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard~~Fund, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section ~~3.17 of this Agreement~~ 3.18 hereof and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan ~~Holder~~Noteholder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) of the Code or result in the receipt by the Trust Fund of any “"income from non-permitted assets” " within the meaning of ~~Code~~ Section 860F(a)(2)(B) of the Code or (i) endanger the status of ~~any Trust~~ the Lower-Tier REMIC or the Upper-Tier REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any Trust~~ the Lower-Tier REMIC or the Upper-Tier REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than ~~an REO Property related~~ with respect to ~~an Outside~~ the Non-Serviced Mortgage Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders ~~and, if applicable,~~ and the related ~~Serviced~~ Companion Loan ~~Holder(s)~~ Noteholders (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))whole), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “"net income from foreclosure property,” " within the meaning of ~~Code~~ Section 860G(c)) of the Code, which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the ~~Certificate Administrator~~ Trustee in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders ~~and, if applicable,~~ and the related Companion Loan ~~Holder(s)~~ Noteholders (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))whole) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “"REO Account”"), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled (a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination), “[Name of Special Servicer]"CWCapital Asset Management LLC, as Special Servicer, ~~on behalf of Wilmington Trust~~in trust for Wells Fargo Bank, ~~National Association~~N.A., as Trustee, in trust for ~~the benefit of the registered~~ Holders of ~~Citigroup Commercial~~ GS Mortgage ~~Trust 2019-C7~~Xxxxrities Corporation II, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2007-~~C7, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION:~~ GG10 and the ~~related Serviced~~ various Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--Noteholders REO Account”. ." The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b~~) of this Agreement~~). The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues ~~and proceeds~~ received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds, which shall be remitted to the Collection Account), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO ~~Property including, if applicable, the payments of any ground rents in respect of such REO~~ Property; and (iv) any taxes imposed on ~~any Trust~~ the Upper-Tier REMIC or Lower-Tier REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date (but not earlier than two (2) Business Days after such amounts are received and properly identified) the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related Collection Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, any related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification4.05. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.

Appears in 1 contract

Samples: Pooling and Servicing Agreement (GS Mortgage Securities Trust 2007-Gg10)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property ~~(other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan)~~ is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the applicable Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a the Trustee, or its nominee ~~of the Trustee~~ (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holders~~Fund. The Special Servicer, on behalf of the Trust Fund, shall ~~sell~~ dispose of any REO Property prior to the close of the third calendar year ~~following~~ beginning after the ~~year in which the Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund acquires ownership of such REO ~~Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1),~~ Property for purposes of ~~Code~~ Section 860G(a)(8)) of the Code, unless (i) the ~~IRS grants (or does not deny)~~ Special Servicer on behalf of the Lower-Tier REMIC has applied for an extension of ~~time (an “REO Extension”~~such period pursuant to Sections 856(e)(3) to and 860G(a)(8)(A) of the Code, in which case the Special Servicer shall sell such REO Property within the applicable extension period or (ii) the Special Servicer ~~obtains~~ seeks and subsequently receives an Opinion of Counsel ~~for~~ (which opinion shall be an expense of the ~~Special Servicer, the Certificate Administrator and the Trustee~~Trust Fund), addressed to the Special ~~Servicer, the Certificate Administrator~~ Servicer and ~~the~~ Trustee, to the effect that the holding by the ~~Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund of such REO Property ~~subsequent to the close of the third calendar year following the year in which such acquisition occurred~~ for an additional specified period will not ~~result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of any Trust REMIC, or~~ cause ~~any Trust REMIC~~ such REO Property to fail to qualify as ~~a REMIC under~~ "foreclosure property" within the meaning of Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of Section 860D(a) of the Code) at any time that any ~~of the Lower-Tier Regular Interests, the 000 Xxxxx Xxxxxx Regular Interests or the Regular Certificates~~ Certificate is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, ~~the Special Servicer~~ in which event such period shall ~~sell such REO Property within such longer period as is permitted~~ be extended by such ~~REO Extension or~~ additional specified period subject to any conditions set forth in such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard~~Fund, shall dispose of any REO Property held by the Trust Fund ~~(i)~~ prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section ~~3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property~~3.18 hereof. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders ~~and, if applicable, the related Serviced Companion Loan Holder,~~ solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) ~~or result in~~ of the ~~receipt by~~ Code (determined without regard to the ~~Trust Fund~~ exception applicable for purposes of ~~any “income from non-permitted assets” within the meaning of Code~~ Section ~~860F(a)(2)(B) or (i) endanger the status of any Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon any Trust REMIC or the Trust Fund~~860D(a)). (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property ~~(other than an REO Property related to an Outside Serviced Mortgage Loan)~~ as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s)))Certificateholders, and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “"net income from foreclosure property,” " within the meaning of ~~Code~~ Section 860G(c)) of the Code, which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the ~~Certificate Administrator~~ Trustee in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “"REO Account”"), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination)~~"Lennar Partners, ~~“[Name of Special Servicer]~~Inc., as Special Servicer, ~~on behalf of Wilmington Trust,~~ in trust for LaSalle National ~~Association~~Bank, as Trustee, in trust for ~~the benefit of the registered~~ Holders of ~~Citigroup Commercial~~ GS Mortgage ~~Trust 2019-C7~~Securities Corporation II, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~1999-C7C1, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”. ." The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b~~) of this Agreement~~). The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues ~~and proceeds~~ received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds, which shall be remitted pursuant to Section 3.18(e) to the Collection Account), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO ~~Property including, if applicable, the payments of any ground rents in respect of such REO~~ Property; and (iv) any taxes imposed on ~~any Trust~~ the Upper-Tier REMIC or Lower-Tier REMIC in respect of net income from foreclosure property in accordance with Section ~~4.05 of this Agreement~~4.05. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iviii) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five ~~(5)~~ Business Days ~~(or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency)~~ prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith judgment, that such Advance would be a Nonrecoverable ~~Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account)~~Advance. If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such ~~Advance unless~~ Advance; and if the Trustee fails to make any such Advance, the Fiscal Agent shall make such Advance, unless in either case, the Trustee or the Fiscal Agent determines that such Advance would be a Nonrecoverable Advance. The Trustee and the Fiscal Agent shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The ~~Trustee~~Trustee and the Fiscal Agent, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall ~~use its good faith business judgment~~be subject to the standards applicable to the Master Servicer hereunder. The Master ~~Servicer~~ Servicer, the Trustee or the ~~Trustee~~Fiscal Agent, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section ~~3.06 and/or, if applicable, Section 3.06A of this Agreement~~3.06. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection ~~Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account,~~ Account on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from each REO ~~Property during the related Collection Period~~Property, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan ~~or Serviced Loan Combination~~ became imminent, all within the meaning of ~~Code~~ Section 856(e)(4)(B)) of the Code; or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special ~~Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator~~ Servicer and the Trustee (which opinion shall be an expense of the Trust ~~Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder~~Fund) to the effect that such action will not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of ~~Code~~ Section 860D(a)) of the Code) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s 's acquisition thereof (unless the Special Servicer shall have provided the Trustee ~~and the Certificate Administrator~~ with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section ~~3.16(b~~3.17(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders ~~and, if applicable, any related Serviced Companion Loan Holder~~ with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee ~~and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with ~~Section 3.16(a~~Sections 3.17(a) and ~~Section 3.16(b) of this Agreement~~3.17(b). ~~(d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.~~

Appears in 1 contract

Samples: Pooling and Servicing Agreement (Gs Mortgage Sec Corp Ii Comm Mort Pa Thro Cer Ser 1999-C1)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property ~~(other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan)~~ is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to ~~a Serviced~~ the Loan Combination, for the benefit of the ~~applicable~~ Certificateholders and the ~~related Serviced Companion~~ Non-Trust Mortgage Loan ~~Holder(s)~~Holder) (as a collective whole as if such Certificateholders and, if applicable, ~~such Serviced Companion~~ the Non-Trust Mortgage Loan ~~Holder(s)~~ Holder constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and ~~any related Serviced Companion~~ the Non-Trust Mortgage Loan ~~Holders~~Holder. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code for federal income tax purposes at any time that any ~~of the~~ Lower-Tier Regular ~~Interests, the 000 Xxxxx Xxxxxx Regular~~ Interests or ~~the~~ Regular Certificates is are outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holder~~Fund, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the ~~related Serviced Companion~~ Non-Trust Mortgage Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property ~~(other than an REO Property related to an Outside Serviced Mortgage Loan)~~ as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the ~~related Serviced Companion~~ Non-Trust Mortgage Loan ~~Holder(s)~~ Holder (as a collective whole as if such Certificateholders and, if applicable, the ~~related Serviced Companion~~ Non-Trust Mortgage Loan ~~Holder(s)~~ Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the ~~related Companion~~ Non-Trust Mortgage Loan ~~Holder(s)~~ Holder (as a collective whole as if such Certificateholders and, if applicable, the ~~related Companion~~ Non-Trust Mortgage Loan ~~Holder(s),~~ Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination),~~ “[~~Name of Special Servicer~~_____], as Special Servicer, ~~on behalf of Wilmington Trust, National Association~~in trust for [_____], as Trustee, in trust for ~~the benefit of the registered~~ Holders of ~~Citigroup~~ Barclays Commercial Mortgage ~~Trust 2019-C7~~Securities LLC, Commercial Mortgage Pass-Through Certificates, Series ~~2019-C7,~~ 20[__]-[~~IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION:~~ __] and the ~~related Serviced Companion~~ Non-Trust Mortgage Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--Holder REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues ~~and proceeds~~ received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds, which shall be remitted to the Collection Account), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five ~~(5)~~ Business Days (or, in an emergency situation or on an urgent basis, two ~~(2)~~ Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith judgment, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its ~~good faith business~~ commercially reasonable judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection ~~Account, or,~~ Account or for ~~a Serviced~~ the Loan Combination, the ~~related~~ Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from each REO Property during the related ~~Collection~~ Prepayment Period, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or ~~Serviced~~ the Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, ~~any related Serviced Companion~~ the Loan Combination Directing Holder (with respect to the Loan Combination, for so long as the Non-Trust Mortgage Loan Holder or its designee is the Loan Combination Directing Holder), the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust ~~Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder~~Fund) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, ~~any related Serviced Companion~~ the Non-Trust Mortgage Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the ~~Trustee~~ Trustee[, the Certificate Administrator] and the ~~Certificate Administrator and the related Serviced Companion~~ Non-Trust Mortgage Loan Holder ~~(or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. ~~(d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.~~

Appears in 1 contract

Samples: Pooling and Servicing Agreement (Barclays Commercial Mortgage Securities LLC)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to ~~an Outside~~ a Non-Serviced Mortgage Loan) is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced ~~Loan Combination~~Whole Loan, for the benefit of the ~~applicable~~ Certificateholders and the related ~~Serviced~~ Companion Loan ~~Holder(s)~~Holders) (as a collective whole as if such Certificateholders ~~and, if applicable, such Serviced~~ and Companion Loan ~~Holder(s)~~ Holders constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and ~~any~~ the related ~~Serviced~~ Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code for federal income tax purposes at any time that any ~~of the~~ Lower-Tier Regular ~~Interests, the 000 Xxxxx Xxxxxx Regular~~ Interests or ~~the~~ Regular Certificates is are outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related ~~Serviced~~ Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than ~~an REO Property related~~ with respect to ~~an Outside~~ the Non-Serviced Mortgage ~~Loan~~Loans) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan ~~Holder(s)~~ Holders (as a collective whole as if such Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan ~~Holder(s)~~ Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan ~~Holder(s)~~ Holder (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan ~~Holder(s),~~ Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer ~~and/or~~ or the Trustee) shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination),~~ “[~~Name of~~ Rialto Capital Advisors, LLC] [the applicable Special Servicer], as Special Servicer, ~~on behalf~~ for the benefit of ~~Wilmington Trust,~~ U.S. Bank National Association, as Trustee, ~~for the benefit of~~ and the registered Holders of ~~Citigroup Commercial~~ GS Mortgage ~~Trust 2019-C7~~Securities Corporation II, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2013-~~C7,~~ GCJ16 [IN THE CASE OF AN REO PROPERTY RELATED TO A ~~SERVICED LOAN COMBINATION~~WHOLE LOAN: and the related ~~Serviced~~ Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan HoldersHolder, as their interests may appear--], REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two~~ one (21) Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues ~~and proceeds~~ received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds, which shall be remitted to the Collection Account), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith business judgment, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced ~~Loan Combination~~Whole Loan, the related Serviced Whole Loan ~~Combination~~ Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from each REO Property during the related ~~Collection~~ Prepayment Period, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Whole Loan ~~Combination~~ became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, ~~any~~ the related ~~Serviced~~ Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if ~~any~~ the related ~~Serviced~~ Companion Loan is part of a REMIC, the related ~~Serviced~~ Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, ~~any~~ the related ~~Serviced~~ Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related ~~Serviced~~ Companion Loan Holder ~~(or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to ~~an Outside~~ a Non-Serviced Mortgage Loan.

Appears in 1 contract

Samples: Pooling and Servicing Agreement (GS Mortgage Securities Trust 2013-Gcj16)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property [(other than a Mortgaged Property with respect to ~~an Outside~~ a Non-Serviced Mortgage Loan) )] is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a ~~Serviced Loan Combination~~Whole Loan, for the benefit of the ~~applicable~~ Certificateholders and the related ~~Serviced~~ Companion Loan ~~Holder(s)~~Holders) (as a collective whole as if such Certificateholders ~~and, if applicable, such Serviced~~ and Companion Loan ~~Holder(s)~~ Holders constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and ~~any~~ the related ~~Serviced~~ Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code for federal income tax purposes at any time that any ~~of the~~ Lower-Tier Regular ~~Interests, the 000 Xxxxx Xxxxxx Regular~~ Interests or ~~the~~ Regular Certificates is are outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related ~~Serviced~~ Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property [(other than ~~an REO Property related~~ with respect to ~~an Outside~~ the Non-Serviced Mortgage ~~Loan)~~ Loans)] as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan ~~Holder(s)~~ Holders (as a collective whole as if such Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan ~~Holder(s)~~ Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan ~~Holder(s)~~ Holder (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan ~~Holder(s),~~ Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination),~~ “[~~Name of Special Servicer~~_____], as Special Servicer, ~~on behalf of Wilmington Trust, National Association~~in trust for [_____], as Trustee, in trust for ~~the benefit of the registered~~ Holders of ~~Citigroup Commercial Mortgage~~ CSMC Trust ~~2019~~20[ ]-C7[ ], Commercial Mortgage Pass-Through Certificates, Series ~~2019-C7,~~ 20[__]-[~~IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION:~~ __] and the ~~related Serviced~~ various Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders ~~of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--~~REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues ~~and proceeds~~ received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds, which shall be remitted to the Collection Account), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith business judgment, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a ~~Serviced Loan Combination~~Whole Loan, the related Whole Loan ~~Combination~~ Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from each REO Property during the related ~~Collection~~ Prepayment Period, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or ~~Serviced~~ Whole Loan ~~Combination~~ became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, ~~any~~ the related ~~Serviced~~ Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if ~~any~~ the related ~~Serviced~~ Companion Loan is part of a REMIC, the related ~~Serviced~~ Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, ~~any~~ the related ~~Serviced~~ Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related ~~Serviced~~ Companion Loan Holder ~~(or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) [Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to ~~an Outside~~ a Non-Serviced Mortgage Loan.]

Appears in 1 contract

Samples: Pooling and Servicing Agreement (Credit Suisse First Boston Mortgage Securities Corp)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property [(other than a Mortgaged Property with respect to ~~an Outside~~ a Non-Serviced Mortgage Loan) )] is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a ~~Serviced Loan Combination~~Whole Loan, for the benefit of the ~~applicable~~ Certificateholders and the related ~~Serviced~~ Companion Loan ~~Holder(s)~~Holders) (as a collective whole as if such Certificateholders ~~and, if applicable, such Serviced~~ and Companion Loan ~~Holder(s)~~ Holders constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and ~~any~~ the related ~~Serviced~~ Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code for federal income tax purposes at any time that any ~~of the~~ Lower-Tier Regular ~~Interests, the 000 Xxxxx Xxxxxx Regular~~ Interests or ~~the~~ Regular Certificates is are outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related ~~Serviced~~ Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property [(other than ~~an REO Property related~~ with respect to ~~an Outside~~ the Non-Serviced Mortgage ~~Loan)~~ Loans)] as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan ~~Holder(s)~~ Holders (as a collective whole as if such Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan ~~Holder(s)~~ Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan ~~Holder(s)~~ Holder (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan ~~Holder(s),~~ Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination),~~ “[~~Name of Special Servicer~~_____], as Special Servicer, ~~on behalf of Wilmington Trust, National Association~~in trust for [_____], as Trustee, in trust for ~~the benefit of the registered~~ Holders of ~~Citigroup Commercial~~ GS Mortgage ~~Trust 2019-C7~~Securities Corporation II, Commercial Mortgage Pass-Through Certificates, Series ~~2019-C7,~~ 20[__]-[~~IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION:~~ __] and the ~~related Serviced~~ various Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders ~~of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--~~REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues ~~and proceeds~~ received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds, which shall be remitted to the Collection Account), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith business judgment, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a ~~Serviced Loan Combination~~Whole Loan, the related Whole Loan ~~Combination~~ Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from each REO Property during the related ~~Collection~~ Prepayment Period, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or ~~Serviced~~ Whole Loan ~~Combination~~ became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, ~~any~~ the related ~~Serviced~~ Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if ~~any~~ the related ~~Serviced~~ Companion Loan is part of a REMIC, the related ~~Serviced~~ Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, ~~any~~ the related ~~Serviced~~ Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related ~~Serviced~~ Companion Loan Holder ~~(or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) [Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to ~~an Outside~~ a Non-Serviced Mortgage Loan.]

Appears in 1 contract

Samples: Pooling and Servicing Agreement (Gs Mortgage Securities Corp Ii)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to ~~an Outside~~ a Non-Serviced Mortgage Loan) is acquired for the benefit of ~~the applicable~~ Certificateholders ~~(or, with respect to a Serviced Loan Combination, for the benefit of the applicable Certificateholders and the related Serviced Companion Loan Holder(s))~~ (as a collective whole as if such Certificateholders ~~and, if applicable, such Serviced Companion Loan Holder(s)~~ constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holders~~Fund. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code for federal income tax purposes at any time that any ~~of the~~ Lower-Tier Regular ~~Interests, the 000 Xxxxx Xxxxxx Regular~~ Interests or ~~the~~ Regular Certificates is are outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holder~~Fund, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders ~~and, if applicable, the related Serviced Companion Loan Holder,~~ solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than ~~an REO Property related~~ with respect to ~~an Outside~~ the Non-Serviced Mortgage ~~Loan~~Loans) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders ~~and, if applicable, the related Serviced Companion Loan Holder(s)~~ (as a collective whole as if such Certificateholders ~~and, if applicable, the related Serviced Companion Loan Holder(s)~~ constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))),~~ lender) and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders ~~and, if applicable, the related Companion Loan Holder(s)~~ (as a collective whole as if such Certificateholders ~~and, if applicable, the related Companion Loan Holder(s),~~ constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination),~~ “[~~Name of~~ LNR Partners, LLC] [the applicable Special Servicer], as Special Servicer, on behalf of ~~Wilmington Trust, National Association~~Deutsche Bank Trust Company Americas, as Trustee, for the ~~benefit of the~~ registered Holders of ~~Citigroup Commercial~~ GS Mortgage ~~Trust 2019-C7~~Securities Corporation II, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2013-C7GCJ14, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two~~ one (21) Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues ~~and proceeds~~ received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds, which shall be remitted to the Collection Account), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith business judgment, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 ~~and/or, if applicable, Section 3.06A~~ of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, ~~or, for a Serviced Loan Combination, the related Loan Combination Custodial Account,~~ on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from each REO Property during the related ~~Collection~~ Prepayment Period, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan ~~or Serviced Loan Combination~~ became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, ~~any related Serviced Companion Loan Holder,~~ the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust ~~Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder~~Fund) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders ~~and, if applicable, any related Serviced Companion Loan Holder~~ with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator ~~and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to ~~an Outside~~ a Non-Serviced Mortgage Loan.

Appears in 1 contract

Samples: Pooling and Servicing Agreement (GS Mortgage Securities Trust 2013-Gcj14)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property ~~(other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan)~~ is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the applicable Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund in foreclosure or by ~~a single member limited liability company established for that purpose)~~ deed in ~~foreclosure, by deed-in-~~lieu of ~~foreclosure or upon abandonment or reclamation from bankruptcy~~foreclosure, the deed or certificate of sale shall be taken in the name of a the Trustee, or its nominee ~~of the Trustee~~ (which shall not include the Master Servicer or the Special Servicer), or a separate trustee or co-trustee, on behalf of the Trust ~~Fund~~ Fund. The Special Servicer shall maintain accurate records with respect to each related REO Property reflecting the status of taxes, assessments and ~~any related Serviced Companion Loan Holders~~other similar items that are or may become a lien on such REO Property and the status of insurance premiums payable with respect thereto. The Special Servicer, on behalf of the Trust Fund, shall ~~sell~~ dispose of any REO Property ~~prior to~~ within two years after the ~~close of the third calendar year following the year in which the Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund acquires ownership of such REO ~~Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1),~~ Property for purposes of ~~Code~~ Section 860G(a)(8)) of the Code, unless (i) the ~~IRS grants (or does not deny)~~ Special Servicer, on behalf of REMIC I, has applied for and received an extension of ~~time (an “REO Extension”~~such two-year period pursuant to Sections 856(e)(3) to and 860G(a)(8)(A) of the Code, in which case the Special Servicer shall sell such REO Property within the applicable extension period or (ii) the Special Servicer ~~obtains~~ seeks and subsequently receives an Opinion of Counsel ~~for~~ (which opinion shall be an expense of the ~~Special Servicer, the Certificate Administrator and the Trustee~~Trust Fund), addressed to the Special ~~Servicer, the Certificate Administrator~~ Servicer and the Trustee, to the effect that the holding by the ~~Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund of such REO Property ~~subsequent to the close of the third calendar year following the year in which such acquisition occurred~~ for an additional specified period will not ~~result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of any Trust REMIC, or~~ cause ~~any Trust REMIC~~ such REO Property to fail to qualify as ~~a REMIC under~~ "foreclosure property" within the meaning of Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of Section 860D(a) of the Code) at any time that any ~~of the Lower-Tier Regular Interests, the 000 Xxxxx Xxxxxx Regular Interests or the Regular Certificates~~ Certificate is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, in which case the Special Servicer shall sell such REO Property within such ~~longer~~ two-year period as ~~is permitted~~ extended by such ~~REO Extension or~~ additional specified period subject to any conditions set forth in such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard~~Fund, shall dispose of any REO Property held by the Trust Fund ~~(i)~~ prior to the last day of ~~such~~ the period (taking into account extensions) by within which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section ~~3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property~~3.18. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders ~~and, if applicable, the related Serviced Companion Loan Holder,~~ solely for the purpose of its ~~prompt~~ disposition and sale in a manner which does not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) ~~or result in~~ of the ~~receipt by~~ Code (determined without regard to the ~~Trust Fund~~ exception applicable for purposes of ~~any “income from non-permitted assets” within~~ Section 860D(a)) of the ~~meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of any Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon any Trust REMIC or the Trust Fund~~Code. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property ~~(other than an REO Property related to an Outside Serviced Mortgage Loan)~~ as are consistent with ~~the~~ Servicing ~~Standard and the terms of this Agreement~~Standard, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s)))Certificateholders, and, in connection therewith, the Special Servicer shall ~~only~~ agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a taxstandards. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “"REO Account”"), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled (a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination), “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association"___________________, as Trustee, in trust for ~~the benefit of the registered~~ Holders of ~~Citigroup~~ Commercial Mortgage ~~Trust 2019-C7~~Acceptance Corp., Commercial Mortgage Pass-Through Certificates, Series ~~2019-C7~~199_-C_, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”. ." The Special Servicer shall be entitled to ~~withdraw for its account~~ any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section ~~3.07(b) of this Agreement~~3.7(b). The Special Servicer shall deposit or cause to be deposited in the related REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all ~~revenues and proceeds~~ REO Proceeds received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of ~~such REO Property and for other Property Protection Expenses with respect to~~ such REO Property, including: (i) all insurance premiums due and payable in respect of ~~any~~ such REO Property; (ii) all real estate taxes and assessments in respect of ~~any~~ such REO Property and such other Mortgaged Properties that may result in the imposition of a lien thereon;; and (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore ~~any~~ such REO Property ~~including~~and such other Mortgaged Properties, ~~if applicable, the payments of~~ including any ~~ground rents in respect of such REO Property; and (iv) any taxes imposed on any Trust REMIC in respect of net income from foreclosure~~ property ~~in accordance with Section 4.05 of this Agreement~~management fees. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iviii) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are dueabove, the Master Servicer shall ~~advance~~ make an Advance equal to the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith judgment, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The ~~Trustee shall be entitled to rely, conclusively, on any determination by the~~ Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent ~~set forth in~~ permitted pursuant to Section ~~3.06 and/or, if applicable, Section 3.06A of this Agreement~~3.6. The Special Servicer shall ~~withdraw from each REO Account and~~ remit to the Master Servicer from each REO Account for deposit ~~into~~ in the Collection ~~Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account,~~ Account on a monthly basis prior to the related ~~Master Servicer~~ Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from ~~each REO Property during~~ the related ~~Collection Period~~REO Property, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in ~~each~~ such REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New ~~Lease,~~ Lease if the New ~~Lease~~ Lease, by its ~~terms~~ terms, will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New ~~Lease,~~ Lease other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ~~ten percent~~ 10% of the construction of such building or other improvement was completed before default on the related Mortgage Loan ~~or Serviced Loan Combination~~ became imminent, all within the meaning of ~~Code~~ Section 856(e)(4)(B)) of the Code; or (iv) Directly Operate or perform any construction work on, or allow any Person (other than an Independent Contractor) to Directly Operate or perform any construction work on, any REO Property on on, any date more than 90 days after its date of acquisition by the Trust Fund~~, unless such Person is an Independent Contractor~~; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special ~~Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator~~ Servicer and the Trustee (which opinion shall be an expense of the Trust ~~Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder~~Fund) to the effect that such action will not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of ~~Code~~ Section 860D(a)) of the Code) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent ~~Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds,~~ Contractor for the operation and management of any REO ~~Property,~~ Property within 90 days of the Trust Fund’s 's acquisition thereof (unless the Special Servicer shall have provided the Trustee ~~and the Certificate Administrator~~ with an Opinion of Counsel that the operation and management of ~~any~~ such REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section ~~3.16(b~~3.17(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders ~~and, if applicable, any related Serviced Companion Loan Holder~~ with respect to the operation and management of any such REO Property; ~~and~~and 77 (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.

Appears in 1 contract

Samples: Pooling and Servicing Agreement (Commercial Mortgage Acceptance Corp)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan) is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the ~~applicable~~ Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by deed-in-lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and any related Serviced Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code at any time that any of the Lower-Tier Regular ~~Interests, the 000 Xxxxx Xxxxxx Regular~~ Interests or any of the Regular Certificates is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related Serviced Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than an REO Property related to an Outside Serviced Mortgage Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be entitled ~~(a) with respect to each~~ “Midland Loan Services, a Division of ~~the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination)~~PNC Bank, ~~“[Name of Special Servicer]~~National Association, as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust ~~2019~~2018-C7C6, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2018-C7C6, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan HoldersHolder, as their interests may appear--,] REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO Account, within two (2) Business Days after receipt of properly identified funds, all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date (but not earlier than two (2) Business Days after such amounts are received and properly identified) the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related Collection Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, any related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.

Appears in 1 contract

Samples: Pooling and Servicing Agreement (CSAIL 2018-C14 Commercial Mortgage Trust)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to an Outside Serviced ~~Mortgage~~ Trust Loan) is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the ~~applicable~~ Certificateholders and the related Serviced Companion Loan ~~Holder(s)~~Holders) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan ~~Holder(s)~~ Holders constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and any related Serviced Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code for federal income tax purposes at any time that any ~~of the~~ Lower-Tier Regular ~~Interests, the 000 Xxxxx Xxxxxx Regular~~ Interests or ~~the~~ Regular Certificates is are outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related Serviced Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than an REO Property related to an Outside Serviced ~~Mortgage~~ Trust Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan ~~Holder(s)~~ Holders (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan ~~Holder(s)~~ Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Serviced Companion Loan ~~Holder(s)~~ Holder (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan ~~Holder(s)~~Holder, constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination)~~“Rialto Capital Advisors, ~~“[Name of Special Servicer]~~LLC, as Special Servicer, on behalf of ~~Wilmington Trust, National Association~~Deutsche Bank Trust Company Americas, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage ~~Trust 2019-C7~~Securities Inc., Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2014-C7GC23, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan HoldersHolder, as their interests may appear--], REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two~~ one (21) Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith business judgment, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related ~~Collection~~ Prepayment Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, ~~any~~ the related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced ~~Mortgage~~ Trust Loan.

Appears in 1 contract

Samples: Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2014-Gc23)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property ~~(other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan)~~ is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the applicable Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund in foreclosure or by ~~a single member limited liability company established for that purpose)~~ deed in ~~foreclosure, by deed-in-~~lieu of ~~foreclosure or upon abandonment or reclamation from bankruptcy~~foreclosure, the deed or certificate of sale shall be taken in the name of a the Trustee, or its nominee ~~of the Trustee~~ (which shall not include the Master Servicer or the Special Servicer), or a separate trustee or co-trustee, on behalf of the Trust ~~Fund~~ Fund. The Special Servicer shall maintain accurate records with respect to each related REO Property reflecting the status of taxes, assessments and ~~any related Serviced Companion Loan Holders~~other similar items that are or may become a lien on such REO Property and the status of insurance premiums payable with respect thereto. The Special Servicer, on behalf of the Trust Fund, shall ~~sell~~ dispose of any REO Property ~~prior to~~ within three taxable years after the close of the ~~third calendar year following the~~ taxable year in which the ~~Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund acquires ownership of such REO ~~Property, within~~ Property (the ~~meaning of Treasury Regulations Section 1.856-6(b)(1),~~ "REO Grace Period") for purposes of ~~Code~~ Section 860G(a)(8)) of the Code, unless (i) the ~~IRS grants (or does not deny)~~ Special Servicer, on behalf of REMIC I, has timely applied for and received an extension of ~~time (an “~~such REO ~~Extension”~~Grace Period pursuant to Sections 856(e)(3) to and 860G(a)(8)(A) of the Code, in which case the Special Servicer shall sell such REO Property by the end of the applicable extension period or (ii) the Special Servicer ~~obtains~~ seeks and subsequently receives an Opinion of Counsel ~~for~~ (the ~~Special Servicer~~cost of such opinion shall be advanced as a Servicing Advance, ~~the Certificate Administrator and the Trustee~~unless it would be a Nonrecoverable Advance), addressed to the Special ~~Servicer, the Certificate Administrator~~ Servicer and the Trustee, to the effect that the holding by the ~~Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund of such REO Property ~~subsequent to the close of the third calendar year following the year in which such acquisition occurred~~ for an additional specified period will not ~~result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of any Trust REMIC, or~~ cause ~~any Trust REMIC~~ such REO Property to fail to qualify as ~~a REMIC under~~ "foreclosure property" within the meaning of Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of Section 860D(a) of the Code) at any time that any ~~of the Lower-Tier Regular Interests, the 000 Xxxxx Xxxxxx Regular Interests or the Regular Certificates~~ Certificate is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, in which case the Special Servicer shall sell such REO Property ~~within~~ by the end of such ~~longer period as is permitted by such REO Extension or~~ additional period, subject to any conditions set forth in such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard~~Fund, shall dispose of any REO Property held by the Trust Fund ~~(i)~~ prior to the last day of ~~such~~ the period (taking into account extensions) by within which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section ~~3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property~~3.18. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders ~~and, if applicable, the related Serviced Companion Loan Holder,~~ solely for the purpose of its ~~prompt~~ disposition and sale in a manner which does not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) or of the Code (determined without regard to the exception applicable for purposes of Section 860D(a)) of the Code or, except as contemplated by Section 3.17(d), result in the receipt by ~~the Trust Fund~~ REMIC I of any “"income from non-permitted assets” " within the meaning of ~~Code~~ Section 860F(a)(2)(B) ~~or (i) endanger~~ of the ~~status~~ Code, in an Adverse REMIC Event in respect of any of the REMICs or in an Adverse Grantor Trust ~~REMIC as a REMIC or (ii) result in the imposition of a tax upon any Trust REMIC or the Trust Fund~~Event. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this ~~Agreement~~Agreement (including, Section 3.27), to do any and all things in connection with any REO Property ~~(other than an REO Property related to an Outside Serviced Mortgage Loan)~~ as are consistent with ~~the~~ Servicing ~~Standard and the terms of this Agreement~~Standard, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s)))Certificateholders, and, in connection therewith, the Special Servicer shall ~~only~~ agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a taxstandards. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “"REO Account”"), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled (a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination), “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association"____________________, as Trustee, in trust for ~~the benefit of the registered~~ Holders of ~~Citigroup Commercial~~ PNC Mortgage ~~Trust 2019-C7~~Acceptance Corp., Commercial Mortgage Pass-Through Certificates, Series ~~2019-C7~~_________, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”. ." The Special Servicer shall be entitled to ~~withdraw for its account~~ any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section ~~3.07(b) of this Agreement~~3.7(b). The Special Servicer shall deposit or cause to be deposited in the related REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all ~~revenues and proceeds~~ REO Proceeds received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO ~~Property and for other Property Protection Expenses with respect to such REO~~ Property, including: (i) all insurance premiums and ground rents, if any, due and payable in respect of ~~any~~ such REO Property; (ii) all real estate taxes and assessments in respect of ~~any~~ such REO Property and such other Mortgaged Properties that may result in the imposition of a lien thereon;; and (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore ~~any~~ such REO Property ~~including~~and such other Mortgaged Properties, ~~if applicable, the payments of~~ including any ~~ground rents in respect of such REO Property; and (iv) any taxes imposed on any Trust REMIC in respect of net income from foreclosure~~ property ~~in accordance with Section 4.05 of this Agreement~~management fees. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iviii) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are dueabove, the Master Servicer shall ~~advance~~ make an Advance equal to the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith judgment, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The ~~Trustee shall be entitled to rely, conclusively, on any determination by the~~ Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent ~~set forth in~~ permitted pursuant to Section ~~3.06 and/or, if applicable, Section 3.06A of this Agreement~~3.6. The Special Servicer shall ~~withdraw from each REO Account and~~ remit to the Master Servicer from each REO Account for deposit ~~into~~ in the Collection ~~Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account,~~ Account on a monthly basis prior to the related ~~Master Servicer~~ Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from ~~each REO Property during~~ the related ~~Collection Period~~REO Property, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in ~~each~~ such REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall ~~not:~~not (unless permitted pursuant to subsection (d) below): (i) permit the Trust Fund to enter into, renew or extend any New ~~Lease,~~ Lease if the New ~~Lease~~ Lease, by its ~~terms~~ terms, will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New ~~Lease,~~ Lease other than amounts that will constitute Rents from Real Property; (~~iii~~iv) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ~~ten percent~~ 10% of the construction of such building or other improvement was completed before default on the related Mortgage Loan ~~or Serviced Loan Combination~~ became imminent, all within the meaning of ~~Code~~ Section 856(e)(4)(B)) of the Code; or (ivv) Directly Operate or perform any construction work on, or allow any Person (other than an Independent Contractor) to Directly Operate or perform any construction work on, any REO Property on on, any date more than 90 days after its date of acquisition by the Trust Fund~~, unless such Person is an Independent Contractor~~; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special ~~Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator~~ Servicer and the Trustee (~~which~~ the cost of such opinion shall be ~~an expense of the Trust Fund and, if any related Serviced Companion Loan is part of~~ advanced as a ~~REMIC, the related Serviced Companion Loan Holder~~Servicing Advance unless such Advance would be a Non-recoverable Advance) to the effect that such action will not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of ~~Code~~ Section 860D(a)) of the Code) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent ~~Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds,~~ Contractor for the operation and management of any REO ~~Property,~~ Property within 90 days of the Trust Fund’s 's acquisition thereof (unless the Special Servicer shall have provided the Trustee ~~and the Certificate Administrator~~ with an Opinion of Counsel that the operation and management of ~~any~~ such REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of Code Section 860G(a)(8)) (~~which~~ the cost of such opinion shall be ~~an expense of the Trust Fund~~advanced as a Servicing Advance, unless such Advance would be a Non-recoverable Advance), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) the terms and conditions of any such contract shall reflect an agreement reached at arm's length and shall be consistent with the provisions of Treasury Regulation Section 1.856-4(b)(5); (iii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent ~~Contractor~~Contractor but only to the extent consistent with Section 856 of the Code and Treasury Regulation Section 1.856-4(b)(5); (~~iii~~iv) none of the provisions of this Section ~~3.16(b~~3.17(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders ~~and, if applicable, any related Serviced Companion Loan Holder~~ with respect to the operation and management of any such REO Property; and (ivv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee ~~and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section ~~3.16(a) and Section 3.16(b) of this Agreement~~3.17(b). (d) ~~Notwithstanding anything~~ The Special Servicer shall, prior to acquisitions of title to any Mortgaged Property, review the operations of such property securing a defaulted loan and determine the character of the income that the Trust would realize if the Trust acquired title to such Mortgaged Property. The Special Servicer shall undertake this analysis with a view to retaining the status of the REO Property as foreclosure property under the REMIC provisions while maximizing the net after-tax REO Income received without materially adversely affecting the Special Servicer's ability to sell such REO Property. The Special Servicer shall, in its good faith and reasonable judgment, and as it deems appropriate after consultation with counsel knowledgeable in such matters (the cost of such consultation shall be advanced as a Servicing Advance, unless such Advance would be a Non-recoverable Advance) determine which of the following alternatives is preferred and commercially feasible. The Special Servicer shall avoid subjecting the income from such Mortgaged Property to tax as either "net income from foreclosure property" or a "prohibited transaction" within the meaning of the REMIC Provisions (an "REO Tax") to the ~~contrary~~maximum extent possible when evaluating the following alternative courses of action: (i) Operate, ~~this Section 3.16 shall~~ or Directly Operate, as defined herein, the Mortgaged Property if none of the income would be subject to an REO tax; or (ii) Contract for operation of the Mortgaged Property through a lease to another party, by contract with an Independent Contractor who Directly Operates such property or such other method pursuant to which the Special Servicer would not ~~apply~~ Directly Operate the Mortgaged Property if the income from the Mortgaged Property could otherwise be subject to ~~any~~ a REO tax; or (iii) Directly Operate the mortgaged property if there are no other commercially feasible means of operating such mortgaged property as REO Property ~~related~~ without the Trust potentially or actually incurring an REO Tax; provided, however, that the Special Servicer shall consult with the Trustee regarding the plan of operations, the estimated income (and character thereof) derived therefrom, the estimated amount of taxes payable on such income and such other information as is necessary to make a reasoned judgment as to whether the REO Property will remain a foreclosure property and whether such plan is likely to maximize the net after tax REO income to the Trust. Neither the Special Servicer nor the Trustee shall be liable to the Certificateholders, the Trust or the other parties to this Agreement or each other for errors in judgment made in good faith in the exercise of their discretion while performing their respective responsibilities under this Section. (e) Promptly following any acquisition by the Trust Fund of an ~~Outside Serviced Mortgage Loan~~REO Property, the Special Servicer shall obtain (i) an update of any appraisal performed pursuant to Section 3.23 which is more than 12 months old, or (ii) to the extent that an appraisal has not been obtained pursuant to such Section, an appraisal of such REO Property by an Independent appraiser familiar with the area in which such REO Property is located in order to determine the fair market value of such REO Property and shall notify the Depositor and the Trustee of the results of such appraisal. Any such appraisal shall be conducted in accordance with MAI standards by an appraiser with at least 5 years experience in the relevant property type and in the jurisdiction in which the Mortgaged Property is located and the cost thereof shall be reimbursable as a Servicing Advance.

Appears in 1 contract

Samples: Pooling and Servicing Agreement (Commercial Mortgage Acceptance Corp)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property ~~(other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan)~~ is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the applicable Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund in foreclosure or by ~~a single member limited liability company established for that purpose)~~ deed in ~~foreclosure, by deed-in-~~lieu of ~~foreclosure or upon abandonment or reclamation from bankruptcy~~foreclosure, the deed or certificate of sale shall be taken in the name of a the Trustee, or its nominee ~~of the Trustee~~ (which shall not include the Master Servicer or the Special Servicer), or a separate trustee or co-trustee, on behalf of the Trust ~~Fund~~ Fund. The Special Servicer shall maintain accurate records with respect to each related REO Property reflecting the status of taxes, assessments and ~~any related Serviced Companion Loan Holders~~other similar items that are or may become a lien on such REO Property and the status of insurance premiums payable with respect thereto. The Special Servicer, on behalf of the Trust Fund, shall ~~sell~~ dispose of any REO Property ~~prior to~~ within three taxable years after the close of the ~~third calendar year following the~~ taxable year in which the ~~Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund acquires ownership of such REO ~~Property, within~~ Property (the ~~meaning of Treasury Regulations Section 1.856-6(b)(1),~~ "REO Grace Period") for purposes of ~~Code~~ Section 860G(a)(8)) of the Code, unless (i) the ~~IRS grants (or does not deny)~~ Special Servicer, on behalf of REMIC I, has timely applied for and received an extension of ~~time (an “~~such REO ~~Extension”~~Grace Period pursuant to Sections 856(e)(3) to and 860G(a)(8)(A) of the Code, in which case the Special Servicer shall sell such REO Property within the applicable extension period or (ii) the Special Servicer ~~obtains~~ seeks and subsequently receives an Opinion of Counsel ~~for~~ (the ~~Special Servicer~~cost of such opinion shall be advanced as a Servicing Advance, ~~the Certificate Administrator and the Trustee~~unless it would be a Nonrecoverable Advance), addressed to the Special ~~Servicer, the Certificate Administrator~~ Servicer and the Trustee, to the effect that the holding by the ~~Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund of such REO Property ~~subsequent to the close of the third calendar year following the year in which such acquisition occurred~~ for an additional specified period will not ~~result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of any Trust REMIC, or~~ cause ~~any Trust REMIC~~ such REO Property to fail to qualify as ~~a REMIC under~~ "foreclosure property" within the meaning of Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of Section 860D(a) of the Code) at any time that any ~~of the Lower-Tier Regular Interests, the 000 Xxxxx Xxxxxx Regular Interests or the Regular Certificates~~ Certificate is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, in which case the Special Servicer shall sell such REO Property within ~~such longer period as is permitted by such~~ the REO Grace Period (collectively the "REO Extension or Period") as extended by the applicable REO Extension Period subject to any conditions set forth in such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard~~Fund, shall dispose of any REO Property held by the Trust Fund ~~(i)~~ prior to the last day of ~~such~~ the period (taking into account extensions) by within which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section ~~3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property~~3.18. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders ~~and, if applicable, the related Serviced Companion Loan Holder,~~ solely for the purpose of its ~~prompt~~ disposition and sale in a manner which does not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) or of the Code (determined without regard to the exception applicable for purposes of Section 860D(a)) of the Code or, except as contemplated by Section 3.19(d), result in the receipt by ~~the Trust Fund~~ REMIC I of any “"income from non-permitted assets” " within the meaning of ~~Code~~ Section 860F(a)(2)(B) of the Code or ~~(i) endanger the status~~ in an Adverse REMIC Event in respect of any ~~Trust REMIC as a REMIC or (ii) result in~~ of the ~~imposition of a tax upon any Trust REMIC or the Trust Fund~~REMICs. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property ~~(other than an REO Property related to an Outside Serviced Mortgage Loan)~~ as are consistent with ~~the~~ Servicing ~~Standard and the terms of this Agreement~~Standard, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s)))Certificateholders, and, in connection therewith, the Special Servicer shall ~~only~~ agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a taxstandards. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “"REO Account”"), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled (a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination), “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, "LaSalle Bank National Association, as Trustee, in trust for ~~the benefit of the registered~~ Holders of ~~Citigroup~~ Commercial Mortgage ~~Trust 2019-C7~~Acceptance Corp., Commercial Mortgage Pass-Through Certificates, Series ~~2019~~1999-C7C1, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”. ." The Special Servicer shall be entitled to ~~withdraw for its account~~ any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section ~~3.07(b) of this Agreement~~3.7(b). The Special Servicer shall deposit or cause to be deposited in the related REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all ~~revenues and proceeds~~ REO Proceeds received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO ~~Property and for other Property Protection Expenses with respect to such REO~~ Property, including: (i) all insurance premiums and ground rents, if any, due and ~~payable~~ pay- able in respect of ~~any~~ such REO Property; (ii) all real estate taxes and assessments in respect of ~~any~~ such REO Property and such other Mortgaged Properties that may result in the imposition of a lien thereon;; and (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore ~~any~~ such REO Property ~~including~~and such other Mortgaged Properties, ~~if applicable, the payments of~~ including any ~~ground rents in respect of such REO Property; and (iv) any taxes imposed on any Trust REMIC in respect of net income from foreclosure~~ property ~~in accordance with Section 4.05 of this Agreement~~management fees. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iviii) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are dueabove, the Master Servicer shall ~~advance~~ make an Advance equal to the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith judgment, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The ~~Trustee shall be entitled to rely, conclusively, on any determination by the~~ Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent ~~set forth in~~ permitted pursuant to Section ~~3.06 and/or, if applicable, Section 3.06A of this Agreement~~3.6. The Special Servicer shall ~~withdraw from each REO Account and~~ remit to the Master Servicer from each REO Account for deposit ~~into~~ in the Collection ~~Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account,~~ Account on a monthly basis prior to the related ~~Master Servicer~~ Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from ~~each REO Property during~~ the related ~~Collection Period~~REO Property, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in ~~each~~ such REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall ~~not:~~not (unless permitted pursuant to subsection (d) below): (i) permit the Trust Fund to enter into, renew or extend any New ~~Lease,~~ Lease if the New ~~Lease~~ Lease, by its ~~terms~~ terms, will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New ~~Lease,~~ Lease other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ~~ten percent~~ 10% of the construction of such building or other improvement was completed before default on the related Mortgage Loan ~~or Serviced Loan Combination~~ became imminent, all within the meaning of ~~Code~~ Section 856(e)(4)(B)) of the Code; or (iv) Directly Operate or perform any construction work on, or allow any Person (other than an Independent Contractor) to Directly Operate or perform any 88 construction work on, any REO Property on on, any date more than 90 days after its date of acquisition by the Trust Fund~~, unless such Person is an Independent Contractor~~; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special ~~Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator~~ Servicer and the Trustee (which opinion shall be an expense of the Trust ~~Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder~~Fund) to the effect that such action will not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of ~~Code~~ Section 860D(a)) of the Code) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent ~~Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds,~~ Contractor for the operation and management of any REO ~~Property,~~ Property within 90 days of the Trust Fund’s 's acquisition thereof (unless the Special Servicer shall have provided the Trustee ~~and the Certificate Administrator~~ with an Opinion of Counsel that the operation and management of ~~any~~ such REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) the terms and conditions of any such contract shall reflect an agreement reached at arm's length and shall be consistent with the provisions of Treasury Regulation Section 1.856-4(b)(5); (iii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent ~~Contractor~~Contractor but only to the extent consistent with Section 856 of the Code and Treasury Regulation Section 1.856-4(b)(5); (~~iii~~iv) none of the provisions of this Section ~~3.16(b~~3.17(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders ~~and, if applicable, any related Serviced Companion Loan Holder~~ with respect to the operation and management of any such REO Property; and (ivv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee ~~and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section ~~3.16(a) and Section 3.16(b) of this Agreement~~3.17(b). (d) ~~Notwithstanding anything~~ The Special Servicer shall, prior to acquisitions of title to any Mortgaged Property, review the operations of such property securing a defaulted loan and determine the character of the income that the Trust would realize if the Trust acquired title to such Mortgaged Property. The Special Servicer shall undertake this analysis with a view to retaining the status of the REO Property as foreclosure property under the REMIC provisions while maximizing the net after-tax REO Income received without materially adversely affecting the Special Servicer's ability to sell such REO Property. The Special Servicer shall, in its good faith and reasonable judgment, and as it deems appropriate after consultation with counsel knowledgeable in such matters (with such consultation being an expense of the Trust Fund) determine which of the following alternatives is preferred and commercially feasible. The Special Servicer shall avoid subjecting the income from such Mortgaged Property to tax as either "net income from foreclosure property" or a "prohibited transaction" within the meaning of the REMIC Provisions (an "REO Tax") to the ~~contrary~~maximum extent possible when evaluating the following alternative courses of action: (i).. Operate, ~~this Section 3.16 shall not apply to any REO~~ or Directly Operate, as defined herein, the Mortgaged Property ~~related~~ if none of the income would be subject to an ~~Outside Serviced Mortgage Loan.~~REO tax; or

Appears in 1 contract

Samples: Pooling and Servicing Agreement (Commercial Mortgage Acceptance Corp)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan) is acquired for the benefit of the ~~applicable~~ Certificateholders and the Combined Uncertificated VRR Interest Owner (or, with respect to a Serviced Loan Combination, for the benefit of the ~~applicable Certificateholders~~ Certificateholders, the Combined Uncertificated VRR Interest Owner and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such ~~Certificateholders~~ Certificateholders, the Combined Uncertificated VRR Interest Owner and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by deed-in-lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and any related Serviced Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier ~~REMIC~~ REMIC, the 360 Xxxxxxxx XXXXX or the 000 Xxxxx Xxxxxx ~~REMIC~~XXXXX, ~~as applicable~~xx xxxxxxxxxx, acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier ~~REMIC~~ REMIC, the 360 Xxxxxxxx XXXXX or the 000 Xxxxx Xxxxxx ~~REMIC~~XXXXX, as applicable, of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of any Trust REMIC, or cause any Trust REMIC to fail to qualify as a REMIC under the Code at any time that any of the Lower-Tier Regular Interests, the 360 Xxxxxxxx XXXXX or the 000 Xxxxx Xxxxxx REMIC or any of the Non-Uncertificated VRR Retained Pooled Regular ~~Interests~~ Certificates or the Class VRR Upper-Tier Regular ~~Certificates~~ Interest is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related Serviced Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of any Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon any Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than an REO Property related to an Outside Serviced Mortgage Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be entitled (a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination), “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass-Through Certificates, Series 2019-C7, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”. The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO Account, within two (2) Business Days after receipt of properly identified funds, all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on any Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date (but not earlier than two (2) Business Days after such amounts are received and properly identified) the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related Collection Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, any related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.to

Appears in 1 contract

Samples: Pooling and Servicing Agreement (BMO 2022-C1 Mortgage Trust)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property ~~(other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan)~~ is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to ~~a Serviced Loan Combination~~the Split-Loan, for the benefit of the ~~applicable~~ Certificateholders and the ~~related Serviced~~ Companion Loan ~~Holder(s)~~Holder) (as a collective whole as if such Certificateholders and, if applicable, ~~such Serviced~~ the Companion Loan ~~Holder(s)~~ Holder constituted a single lender) (either by the Trust Fund or by a single member limited liability company or limited partnership, 100% of the equity interests in which are owned, directly or indirectly, by the Trust through one or more single member limited liability companies or such limited partnerships established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and ~~any related Serviced~~ the Companion Loan ~~Holders~~Holder. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of ~~Counsel for the Special Servicer, the Certificate Administrator and the Trustee~~Counsel, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC ~~under the Code~~ at any time that any ~~of the~~ Lower-Tier Regular ~~Interests, the 000 Xxxxx Xxxxxx Regular~~ Interests or ~~the~~ Regular Certificates is are outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holder~~Fund, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the ~~related Serviced~~ Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property ~~(other than an REO Property related to an Outside Serviced Mortgage Loan)~~ as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the ~~related Serviced~~ Companion Loan ~~Holder(s)~~ Holder (as a collective whole as if such Certificateholders and, if applicable, the ~~related Serviced~~ Companion Loan ~~Holder(s)~~ Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the ~~related~~ Companion Loan ~~Holder(s)~~ Holder (as a collective whole as if such Certificateholders and, if applicable, the ~~related~~ Companion Loan ~~Holder(s),~~ Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination),~~ “[~~Name of Special Servicer~~SPECIAL SERVICER], as Special Servicer, ~~on behalf of Wilmington Trust, National Association~~in trust for [TRUSTEE], as Trustee, in trust for ~~the benefit of the registered~~ Holders of ~~Citigroup~~ [______] Commercial Mortgage Trust ~~2019-C7, Commercial~~ 20[__]-[__]Commercial Mortgage Pass-Through Certificates, Series ~~2019-C7,~~ 20[__]-[~~IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION:~~ __] and the ~~related Serviced~~ Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--Holder REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues ~~and proceeds~~ received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds, which shall be remitted to the Collection Account), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five ~~(5)~~ Business Days (or, in an emergency situation or on an urgent basis, two ~~(2)~~ Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith judgment, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection ~~Account, or,~~ Account or for ~~a Serviced Loan Combination~~the Split-Loan, the ~~related~~ Split-Loan ~~Combination~~ Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from each REO Property during the related ~~Collection~~ Prepayment Period, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or ~~Serviced~~ the Split-Loan ~~Combination~~ became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, ~~any related Serviced~~ the Split-Loan Directing Holder (with respect to the Split-Loan, for so long as the Companion Loan Holder or its designee is the Split-Loan Directing Holder), the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust ~~Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder~~Fund) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, ~~any related Serviced~~ the Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the ~~Trustee and~~ Trustee, the Certificate Administrator and the ~~related Serviced~~ Companion Loan Holder ~~(or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. ~~(d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.~~

Appears in 1 contract

Samples: Pooling and Servicing Agreement (CCRE Commercial Mortgage Securities, L.P.)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property ~~(other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan)~~ is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the applicable Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a the Trustee, or its nominee ~~of the Trustee~~ (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holders~~Fund. The Special Servicer, on behalf of the Trust Fund, shall ~~sell~~ dispose of any REO Property prior to the close of the third calendar year following the year in which the ~~Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund acquires ownership of such REO ~~Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1),~~ Property for purposes of ~~Code~~ Section 860G(a)(8)) of the Code, unless (i) the ~~IRS grants (or does not deny)~~ Special Servicer on behalf of the Lower-Tier REMIC has applied for an extension of ~~time (an “REO Extension”~~such period pursuant to Sections 856(e)(3) to and 860G(a)(8)(A) of the Code, in which case the Special Servicer shall sell such REO Property within the applicable extension period or (ii) the Special Servicer ~~obtains~~ seeks and subsequently receives an Opinion of Counsel ~~for~~ (which opinion shall be an expense of the ~~Special Servicer, the Certificate Administrator and the Trustee~~Trust Fund), addressed to the Special ~~Servicer, the Certificate Administrator~~ Servicer and ~~the~~ Trustee, to the effect that the holding by the ~~Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund of such REO Property ~~subsequent to the close of the third calendar year following the year in which such acquisition occurred~~ for an additional specified period will not ~~result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of any Trust REMIC, or~~ cause ~~any Trust REMIC~~ such REO Property to fail to qualify as ~~a REMIC under~~ "foreclosure property" within the meaning of Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of Section 860D(a) of the Code) at any time that any ~~of the Lower-Tier Regular Interests, the 000 Xxxxx Xxxxxx Regular Interests or the Regular Certificates~~ Certificate is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, ~~the Special Servicer~~ in which event such period shall ~~sell such REO Property within such longer period as is permitted~~ be extended by such ~~REO Extension or~~ additional specified period subject to any conditions set forth in such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard~~Fund, shall dispose of any REO Property held by the Trust Fund ~~(i)~~ prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section ~~3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property~~3.18 hereof. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders ~~and, if applicable, the related Serviced Companion Loan Holder,~~ solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) ~~or result in~~ of the ~~receipt by~~ Code (determined without regard to the ~~Trust Fund~~ exception applicable for purposes of ~~any “income from non-permitted assets” within the meaning of Code~~ Section ~~860F(a)(2)(B) or (i) endanger the status of any Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon any Trust REMIC or the Trust Fund~~860D(a)). (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property ~~(other than an REO Property related to an Outside Serviced Mortgage Loan)~~ as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s)))Certificateholders, and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more ~~favorable~~favorable to the Trust Fund. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “"net income from foreclosure property,” " within the meaning of ~~Code~~ Section 860G(c)) of the Code, which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the ~~Certificate Administrator~~ Trustee in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “"REO Account”"), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination), “~~"[~~Name of~~ Special Servicer], ~~as Special Servicer, on behalf of Wilmington Trust,~~ in trust for LaSalle National ~~Association~~Bank, as Trustee, in trust for ~~the benefit of the registered~~ Holders of ~~Citigroup Commercial Mortgage Trust 2019-C7~~Xxxxxx Xxxxxxx Capital I Inc., Commercial Mortgage Pass-Through Certificates, Series ~~2019~~1997-C7XL1, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”. ." The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b~~) of this Agreement~~). The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues ~~and proceeds~~ received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds, which shall be remitted pursuant to Section 3.18(e) to the Collection Account), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO ~~Property including, if applicable, the payments of any ground rents in respect of such REO~~ Property; and (iv) any taxes imposed on ~~any Trust~~ the Upper Tier REMIC or Lower-Tier REMIC in respect of net income from foreclosure property in accordance with Section ~~4.05 of this Agreement~~4.05. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iviii) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five ~~(5)~~ Business Days ~~(or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency)~~ prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith judgment, that such Advance would be a Nonrecoverable ~~Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account)~~Advance. If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such ~~Advance unless~~ Advance; and if the Trustee fails to make any such Advance, the Fiscal Agent shall make such Advance, unless in either case, the Trustee or the Fiscal Agent determines that such Advance would be a Nonrecoverable Advance. The Trustee and the Fiscal Agent shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The ~~Trustee~~Trustee and the Fiscal Agent, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall ~~use its good faith business judgment~~be subject to the standards applicable to the Master Servicer hereunder. The Master ~~Servicer~~ Servicer, the Trustee or the ~~Trustee~~Fiscal Agent, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section ~~3.06 and/or, if applicable, Section 3.06A of this Agreement~~3.06. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection ~~Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account,~~ Account on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from each REO ~~Property during the related Collection Period~~Property, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan ~~or Serviced Loan Combination~~ became imminent, all within the meaning of ~~Code~~ Section 856(e)(4)(B)) of the Code; or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special ~~Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator~~ Servicer and the Trustee (which opinion shall be an expense of the Trust ~~Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder~~Fund) to the effect that such action will not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of ~~Code~~ Section 860D(a)) of the Code) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s 's acquisition thereof (unless the Special Servicer shall have provided the Trustee ~~and the Certificate Administrator~~ with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section ~~3.16(b~~3.17(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders ~~and, if applicable, any related Serviced Companion Loan Holder~~ with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee ~~and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with ~~Section 3.16(a~~Sections 3.17(a) and ~~Section 3.16(b) of this Agreement~~3.17(b). ~~(d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.~~

Appears in 1 contract

Samples: Pooling and Servicing Agreement (Morgan Stanley Capital I Inc)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property ~~(other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan)~~ is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the applicable Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a the Trustee, or its nominee ~~of the Trustee~~ (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holders~~Fund. The Special Servicer, on behalf of the Trust Fund, shall ~~sell~~ dispose of any REO Property prior to the close of the third calendar year ~~following~~ after the year in which the ~~Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund acquires ownership of such REO ~~Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1),~~ Property for purposes of ~~Code~~ Section 860G(a)(8)) of the Code, unless (i) the ~~IRS grants (or does not deny)~~ Special Servicer on behalf of the Lower-Tier REMIC has applied for an extension of ~~time (an “REO Extension”~~such period pursuant to Sections 856(e)(3) to and 860G(a)(8)(A) of the Code, in which case the Special Servicer shall sell such REO Property within the applicable extension period or (ii) the Special Servicer ~~obtains~~ seeks and subsequently receives an Opinion of Counsel ~~for~~ (which opinion shall be an expense of the ~~Special Servicer, the Certificate Administrator and the Trustee~~Trust Fund), addressed to the Special ~~Servicer, the Certificate Administrator~~ Servicer and ~~the~~ Trustee, to the effect that the holding by the ~~Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund of such REO Property ~~subsequent to the close of the third calendar year following the year in which such acquisition occurred~~ for an additional specified period will not ~~result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of any Trust REMIC, or~~ cause ~~any Trust REMIC~~ such REO Property to fail to qualify as ~~a REMIC under~~ "foreclosure property" within the meaning of Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of Section 860D(a) of the Code) at any time that any ~~of the Lower-Tier Regular Interests, the 000 Xxxxx Xxxxxx Regular Interests or the Regular Certificates~~ Certificate is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, ~~the Special Servicer~~ in which event such period shall ~~sell such REO Property within such longer period as is permitted~~ be extended by such ~~REO Extension or~~ additional specified period subject to any conditions set forth in such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard~~Fund, shall dispose of any REO Property held by the Trust Fund ~~(i)~~ prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section ~~3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property~~3.18 hereof. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders ~~and, if applicable, the related Serviced Companion Loan Holder,~~ solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) ~~or result in~~ of the ~~receipt by~~ Code (determined without regard to the ~~Trust Fund~~ exception applicable for purposes of ~~any “income from non-permitted assets” within the meaning of Code~~ Section ~~860F(a)(2)(B) or (i) endanger the status of any Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon any Trust REMIC or the Trust Fund~~860D(a)). (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property ~~(other than an REO Property related to an Outside Serviced Mortgage Loan)~~ as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s)))Certificateholders, and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “"net income from foreclosure property,” " within the meaning of ~~Code~~ Section 860G(c)) of the Code, which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the ~~Certificate Administrator~~ Trustee in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “"REO Account”"), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled (a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination), “[Name of Special Servicer], as "Special Servicer, ~~on behalf of Wilmington Trust,~~ in trust for LaSalle National ~~Association~~Bank, as Trustee, in trust for ~~the benefit of the registered~~ Holders of ~~Citigroup Commercial Mortgage Trust 2019-C7~~Structured Asset Securities Corporation, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~1997-C7LL I, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”. ." The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b~~) of this Agreement~~). The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues ~~and proceeds~~ received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds, which shall be remitted pursuant to Section 3.18(e) to the Collection Account), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO ~~Property including, if applicable, the payments of any ground rents in respect of such REO~~ Property; and (iv) any taxes imposed on ~~any Trust~~ the Upper Tier REMIC or Lower-Tier REMIC in respect of net income from foreclosure property in accordance with Section ~~4.05 of this Agreement~~4.05. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iviii) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five ~~(5)~~ Business Days ~~(or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency)~~ prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith judgment, that such Advance would be a Nonrecoverable ~~Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account)~~Advance. If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such ~~Advance unless~~ Advance; and if the Trustee fails to make any such Advance, the Fiscal Agent shall make such Advance, unless in either case, the Trustee or the Fiscal Agent determines that such Advance would be a Nonrecoverable Advance. The Trustee and the Fiscal Agent shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The ~~Trustee~~Trustee and the Fiscal Agent, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall ~~use its good faith business judgment~~be subject to the standards applicable to the Master Servicer hereunder. The Master ~~Servicer~~ Servicer, the Trustee or the ~~Trustee~~Fiscal Agent, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section ~~3.06 and/or, if applicable, Section 3.06A of this Agreement~~3.06. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection ~~Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account,~~ Account on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from each REO ~~Property during the related Collection Period~~Property, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan ~~or Serviced Loan Combination~~ became imminent, all within the meaning of ~~Code~~ Section 856(e)(4)(B)) of the Code; or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special ~~Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator~~ Servicer and the Trustee (which opinion shall be an expense of the Trust ~~Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder~~Fund) to the effect that such action will not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of ~~Code~~ Section 860D(a)) of the Code) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s 's acquisition thereof (unless the Special Servicer shall have provided the Trustee ~~and the Certificate Administrator~~ with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section ~~3.16(b~~3.17(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders ~~and, if applicable, any related Serviced Companion Loan Holder~~ with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) ~~When~~ With respect to each REO Property, when and as necessary, and no later than thirty days following the end of each calendar quarter, the Special Servicer shall ~~send~~ deliver to the Trustee ~~and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with ~~Section 3.16(a~~Sections 3.17(a) and ~~Section 3.16(b) of this Agreement~~3.17(b). ~~(d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.~~

Appears in 1 contract

Samples: Pooling and Servicing Agreement (Structured Asset Securities Corp Series 1997 Ll I)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property ~~(other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan)~~ is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a ~~Serviced Loan Combination~~Whole Loan, for the benefit of the ~~applicable~~ Certificateholders and the related ~~Serviced~~ Companion ~~Loan Holder(s)~~Interest Holders) (as a collective whole as if such Certificateholders ~~and, if applicable, such Serviced~~ and Companion ~~Loan Holder(s)~~ Interest Holders constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and ~~any~~ the related ~~Serviced~~ Companion ~~Loan~~ Interest Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the applicable Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special ~~Servicer, the Certificate Administrator~~ Servicer and the Trustee, addressed to the Special ~~Servicer, the Certificate Administrator~~ Servicer and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in ~~Code~~ Section ~~860F~~860F of the Code) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC ~~under the Code~~ at any time that any ~~of the~~ Lower-Tier Regular ~~Interests, the 000 Xxxxx Xxxxxx Regular~~ Interests or ~~the~~ Regular Certificates is are outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holder~~Fund, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related ~~Serviced~~ Companion ~~Loan~~ Interest Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property ~~(other than an REO Property related to an Outside Serviced Mortgage Loan)~~ as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders ~~and, if applicable,~~ and the related ~~Serviced~~ Companion ~~Loan Holder(s)~~ Interest Holders (as a collective whole as if such Certificateholders ~~and, if applicable, the related Serviced~~ and Companion ~~Loan Holder(s)~~ Interest Holders constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the ~~Certificate Administrator~~ Trustee in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders ~~and, if applicable,~~ and the related Companion ~~Loan Holder(s)~~ Interest Holders (as a collective whole as if such Certificateholders ~~and, if applicable, the related~~ and Companion ~~Loan Holder(s),~~ Interest Holders constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer and/or the Trustee) shall be entitled (a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination), “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass-Through Certificates, Series 2019-C7, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”. The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO Account, within two (2) Business Days after receipt of properly identified funds, all revenues and proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on any Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date (but not earlier than two (2) Business Days after such amounts are received and properly identified) the Net REO Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance Proceeds received or collected from each REO Property during the related Collection Period, except that in determining the amount of any such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Loan Combination became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, any related Serviced Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.such

Appears in 1 contract

Samples: Pooling and Servicing Agreement (Gs Mortgage Securities Corp Ii)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property ~~(other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan)~~ is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the applicable Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund in foreclosure or by ~~a single member limited liability company established for that purpose)~~ deed in ~~foreclosure, by deed-in-~~lieu of ~~foreclosure or upon abandonment or reclamation from bankruptcy~~foreclosure, the deed or certificate of sale shall be taken in the name of a the Trustee, or its nominee ~~of the Trustee~~ (which shall not include the Master Servicer or the Special Servicer), or a separate trustee or co-trustee, on behalf of the Trust ~~Fund~~ Fund. The Special Servicer shall maintain accurate records with respect to each related REO Property reflecting the status of taxes, assessments and ~~any related Serviced Companion Loan Holders~~other similar items that are or may become a lien on such REO Property and the status of insurance premiums payable with respect thereto. The Special Servicer, on behalf of the Trust Fund, shall ~~sell~~ dispose of any REO Property ~~prior to~~ within three taxable years after the close of the ~~third calendar year following the~~ taxable year in which the ~~Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund acquires ownership of such REO ~~Property, within~~ Property (the ~~meaning of Treasury Regulations Section 1.856-6(b)(1),~~ "REO Grace Period") for purposes of ~~Code~~ Section 860G(a)(8)) of the Code, unless (i) the ~~IRS grants (or does not deny)~~ Special Servicer, on behalf of REMIC I, has timely applied for and received an extension of ~~time (an “~~such REO ~~Extension”~~Grace Period pursuant to Sections 856(e)(3) to and 860G(a)(8)(A) of the Code, in which case the Special Servicer shall sell such REO Property by the end of the applicable extension period or (ii) the Special Servicer ~~obtains~~ seeks and subsequently receives an Opinion of Counsel ~~for~~ (the ~~Special Servicer~~cost of such opinion shall be advanced as a Servicing Advance, ~~the Certificate Administrator and the Trustee~~unless it would be a Nonrecoverable Advance), addressed to the Special ~~Servicer, the Certificate Administrator~~ Servicer and the Trustee, to the effect that the holding by the ~~Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund of such REO Property ~~subsequent to the close of the third calendar year following the year in which such acquisition occurred~~ for an additional specified period will not ~~result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of any Trust REMIC, or~~ cause ~~any Trust REMIC~~ such REO Property to fail to qualify as ~~a REMIC under~~ "foreclosure property" within the meaning of Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of Section 860D(a) of the Code) at any time that any ~~of the Lower-Tier Regular Interests, the 000 Xxxxx Xxxxxx Regular Interests or the Regular Certificates~~ Certificate is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, in which case the Special Servicer shall sell such REO Property ~~within~~ by the end of such ~~longer period as is permitted by such REO Extension or~~ additional period, subject to any conditions set forth in such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard~~Fund, shall dispose of any REO Property held by the Trust Fund ~~(i)~~ prior to the last day of ~~such~~ the period (taking into account extensions) by within which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section ~~3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property~~3.18. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders ~~and, if applicable, the related Serviced Companion Loan Holder,~~ solely for the purpose of its ~~prompt~~ disposition and sale in a manner which does not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) or of the Code (determined without regard to the exception applicable for purposes of Section 860D(a)) of the Code or, except as contemplated by Section 3.17(d), result in the receipt by ~~the Trust Fund~~ REMIC I of any “"income from non-permitted assets” " within the meaning of ~~Code~~ Section 860F(a)(2)(B) ~~or (i) endanger~~ of the ~~status~~ Code, in an Adverse REMIC Event in respect of any of the REMICs or in an Adverse Grantor Trust ~~REMIC as a REMIC or (ii) result in the imposition of a tax upon any Trust REMIC or the Trust Fund~~Event. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this ~~Agreement~~Agreement (including, Section 3.27), to do any and all things in connection with any REO Property ~~(other than an REO Property related to an Outside Serviced Mortgage Loan)~~ as are consistent with ~~the~~ Servicing ~~Standard and the terms of this Agreement~~Standard, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s)))Certificateholders, and, in connection therewith, the Special Servicer shall ~~only~~ agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a taxstandards. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “"REO Account”"), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled (a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination), “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust"Norwest Bank Minnesota, National Association, as Trustee, in trust for ~~the benefit of the registered~~ Holders of ~~Citigroup Commercial~~ PNC Mortgage ~~Trust 2019-C7~~Acceptance Corp., Commercial Mortgage Pass-Through Certificates, Series ~~2019~~1999-C7CM1, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”. ." The Special Servicer shall be entitled to ~~withdraw for its account~~ any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section ~~3.07(b) of this Agreement~~3.7(b). The Special Servicer shall deposit or cause to be deposited in the related REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all ~~revenues and proceeds~~ REO Proceeds received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO ~~Property and for other Property Protection Expenses with respect to such REO~~ Property, including: (i) all insurance premiums and ground rents, if any, due and payable in respect of ~~any~~ such REO Property; (ii) all real estate taxes and assessments in respect of ~~any~~ such REO Property and such other Mortgaged Properties that may result in the imposition of a lien thereon;; and (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore ~~any~~ such REO Property ~~including~~and such other Mortgaged Properties, ~~if applicable, the payments of~~ including any ~~ground rents in respect of such REO Property; and (iv) any taxes imposed on any Trust REMIC in respect of net income from foreclosure~~ property ~~in accordance with Section 4.05 of this Agreement~~management fees. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iviii) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are dueabove, the Master Servicer shall ~~advance~~ make an Advance equal to the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith judgment, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The ~~Trustee shall be entitled to rely, conclusively, on any determination by the~~ Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent ~~set forth in~~ permitted pursuant to Section ~~3.06 and/or, if applicable, Section 3.06A of this Agreement~~3.6. The Special Servicer shall ~~withdraw from each REO Account and~~ remit to the Master Servicer from each REO Account for deposit ~~into~~ in the Collection ~~Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account,~~ Account on a monthly basis prior to the related ~~Master Servicer~~ Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from ~~each REO Property during~~ the related ~~Collection Period~~REO Property, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in ~~each~~ such REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall ~~not:~~not (unless permitted pursuant to subsection (d) below): (i) permit the Trust Fund to enter into, renew or extend any New ~~Lease,~~ Lease if the New ~~Lease~~ Lease, by its ~~terms~~ terms, will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New ~~Lease,~~ Lease other than amounts that will constitute Rents from Real Property; (~~iii~~iv) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ~~ten percent~~ 10% of the construction of such building or other improvement was completed before default on the related Mortgage Loan ~~or Serviced Loan Combination~~ became imminent, all within the meaning of ~~Code~~ Section 856(e)(4)(B)) of the Code; or (ivv) Directly Operate or perform any construction work on, or allow any Person (other than an Independent Contractor) to Directly Operate or perform any construction work on, any REO Property on on, any date more than 90 days after its date of acquisition by the Trust Fund~~, unless such Person is an Independent Contractor~~; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special ~~Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator~~ Servicer and the Trustee (~~which~~ the cost of such opinion shall be ~~an expense of the Trust Fund and, if any related Serviced Companion Loan is part of~~ advanced as a ~~REMIC, the related Serviced Companion Loan Holder~~Servicing Advance unless such Advance would be a Non-recoverable Advance) to the effect that such action will not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of ~~Code~~ Section 860D(a)) of the Code) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent ~~Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds,~~ Contractor for the operation and management of any REO ~~Property,~~ Property within 90 days of the Trust Fund’s 's acquisition thereof (unless the Special Servicer shall have provided the Trustee ~~and the Certificate Administrator~~ with an Opinion of Counsel that the operation and management of ~~any~~ such REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of Code Section 860G(a)(8)) (~~which~~ the cost of such opinion shall be ~~an expense of the Trust Fund~~advanced as a Servicing Advance, unless such Advance would be a Non-recoverable Advance), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) the terms and conditions of any such contract shall reflect an agreement reached at arm's length and shall be consistent with the provisions of Treasury Regulation Section 1.856-4(b)(5); (iii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent ~~Contractor~~Contractor but only to the extent consistent with Section 856 of the Code and Treasury Regulation Section 1.856-4(b)(5); (~~iii~~iv) none of the provisions of this Section ~~3.16(b~~3.17(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders ~~and, if applicable, any related Serviced Companion Loan Holder~~ with respect to the operation and management of any such REO Property; and (ivv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee ~~and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section ~~3.16(a) and Section 3.16(b) of this Agreement~~3.17(b). (d) ~~Notwithstanding anything~~ The Special Servicer shall, prior to acquisitions of title to any Mortgaged Property, review the operations of such property securing a defaulted loan and determine the character of the income that the Trust would realize if the Trust acquired title to such Mortgaged Property. The Special Servicer shall undertake this analysis with a view to retaining the status of the REO Property as foreclosure property under the REMIC provisions while maximizing the net after-tax REO Income received without materially adversely affecting the Special Servicer's ability to sell such REO Property. The Special Servicer shall, in its good faith and reasonable judgment, and as it deems appropriate after consultation with counsel knowledgeable in such matters (the cost of such consultation shall be advanced as a Servicing Advance, unless such Advance would be a Non-recoverable Advance) determine which of the following alternatives is preferred and commercially feasible. The Special Servicer shall avoid subjecting the income from such Mortgaged Property to tax as either "net income from foreclosure property" or a "prohibited transaction" within the meaning of the REMIC Provisions (an "REO Tax") to the ~~contrary~~maximum extent possible when evaluating the following alternative courses of action: (i) Operate, ~~this Section 3.16 shall~~ or Directly Operate, as defined herein, the Mortgaged Property if none of the income would be subject to an REO tax; or (ii) Contract for operation of the Mortgaged Property through a lease to another party, by contract with an Independent Contractor who Directly Operates such property or such other method pursuant to which the Special Servicer would not ~~apply~~ Directly Operate the Mortgaged Property if the income from the Mortgaged Property could otherwise be subject to ~~any~~ a REO tax; or (iii) Directly Operate the mortgaged property if there are no other commercially feasible means of operating such mortgaged property as REO Property ~~related~~ without the Trust potentially or actually incurring an REO Tax; provided, however, that the Special Servicer shall consult with the Trustee regarding the plan of operations, the estimated income (and character thereof) derived therefrom, the estimated amount of taxes payable on such income and such other information as is necessary to make a reasoned judgment as to whether the REO Property will remain a foreclosure property and whether such plan is likely to maximize the net after tax REO income to the Trust. Neither the Special Servicer nor the Trustee shall be liable to the Certificateholders, the Trust or the other parties to this Agreement or each other for errors in judgment made in good faith in the exercise of their discretion while performing their respective responsibilities under this Section. (e) Promptly following any acquisition by the Trust Fund of an ~~Outside Serviced Mortgage Loan~~REO Property, the Special Servicer shall obtain (i) an update of any appraisal performed pursuant to Section 3.23 which is more than 12 months old, or (ii) to the extent that an appraisal has not been obtained pursuant to such Section, an appraisal of such REO Property by an Independent appraiser familiar with the area in which such REO Property is located in order to determine the fair market value of such REO Property and shall notify the Depositor and the Trustee of the results of such appraisal. Any such appraisal shall be conducted in accordance with MAI standards by an appraiser with at least 5 years experience in the relevant property type and in the jurisdiction in which the Mortgaged Property is located and the cost thereof shall be reimbursable as a Servicing Advance.

Appears in 1 contract

Samples: Pooling and Servicing Agreement (PNC Mort Accept Corp Commerc Mort Pass THR Cert Ser 1999 Cm1)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to ~~an Outside~~ a Non-Serviced Mortgage Loan) is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced ~~Loan Combination~~Whole Loan, for the benefit of the ~~applicable~~ Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders ~~and, if applicable, such~~ and Serviced Companion Loan Holder(s) constituted a single lender, taking into account the subordinate nature of any related Subordinate Companion Loan) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and ~~any~~ the related ~~Serviced~~ Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code for federal income tax purposes at any time that any ~~of the Lower-Tier Regular Interests, the 000 Xxxxx Xxxxxx Regular Interests or the Regular Certificates~~ Certificate is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related ~~Serviced~~ Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund~~. (b)~~ . The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than ~~an REO Property related~~ with respect to ~~an Outside~~ the Non-Serviced Mortgage ~~Loan~~Loans) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan ~~Holder(s)~~ Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination~~lender, taking into account the subordinate nature of any related Subordinate Companion ~~Loan(s))~~Loan), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that ~~are~~ it determines in its reasonable business judgment to be substantially consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), ) constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination~~lender, taking into account the subordinate nature of any related Subordinate Companion ~~Loan(s))~~Loan) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer ~~and/or~~ or the Trustee) shall be entitled ~~(a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination),~~ “~~[Name of Special Servicer]~~C-III Asset Management LLC, as Special Servicer, on behalf of ~~Wilmington Trust~~Xxxxx Fargo Bank, National Association, as Trustee, for the ~~benefit of the~~ registered Holders of ~~Citigroup~~ CSAIL 2015-C1 Commercial Mortgage ~~Trust 2019-C7~~Trust, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2015-~~C7,~~ C1 [~~IN THE CASE OF AN~~ in the case of an REO ~~PROPERTY RELATED TO A SERVICED LOAN COMBINATION~~Property related to a Whole Loan: and the related ~~Serviced~~ Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan HoldersHolder, as their interests may appear--], REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues ~~and proceeds~~ received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds, which shall be remitted to the Collection Account), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to rely, conclusively, on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced ~~Loan Combination~~Whole Loan, the related Serviced Whole Loan ~~Combination~~ Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from each REO Property during the related ~~Collection~~ Prepayment Period, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Whole Loan ~~Combination~~ became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, ~~any~~ the related ~~Serviced~~ Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if ~~any~~ the related ~~Serviced~~ Companion Loan is part of a REMIC, the related ~~Serviced~~ Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section 3.16(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, ~~any~~ the related ~~Serviced~~ Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf) a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) and Section 3.16(b) of this Agreement. (d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.

Appears in 1 contract

Samples: Pooling and Servicing Agreement (CSAIL 2015-C1 Commercial Mortgage Trust)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property ~~(other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan)~~ is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the applicable Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund in foreclosure or by ~~a single member limited liability company established for that purpose)~~ deed in ~~foreclosure, by deed-in-~~lieu of ~~foreclosure or upon abandonment or reclamation from bankruptcy~~foreclosure, the deed or certificate of sale shall be taken in the name of a the Trustee, or its nominee ~~of the Trustee~~ (which shall not include the ~~Master~~ Servicer or the Special Servicer), or a separate trustee or co-trustee, on behalf of the Trust ~~Fund~~ Fund. The Special Servicer shall maintain accurate records with respect to each related REO Property reflecting the status of taxes, assessments and ~~any related Serviced Companion Loan Holders~~other similar items that are or may become a lien on such REO Property and the status of insurance premiums payable with respect thereto. The Special Servicer, on behalf of the Trust Fund, shall ~~sell~~ dispose of any REO Property ~~prior to~~ within two years after the ~~close of the third calendar year following the year in which the Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund acquires ownership of such REO ~~Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1),~~ Property for purposes of ~~Code~~ Section 860G(a)(8)) of the Code, unless (i) the ~~IRS grants (or does not deny)~~ Special Servicer, on behalf of REMIC I, has applied for and received an extension of ~~time (an “REO Extension”~~such two-year period pursuant to Sections 856(e)(3) to and 860G(a)(8)(A) of the Code, in which case the Special Servicer shall sell such REO Property within the applicable extension period or (ii) the Special Servicer ~~obtains~~ seeks and subsequently receives an Opinion of Counsel ~~for~~ (which opinion shall be an expense of the ~~Special Servicer, the Certificate Administrator and the Trustee~~Trust Fund), addressed to the Special ~~Servicer, the Certificate Administrator~~ Servicer and the Trustee, to the effect that the holding by the ~~Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund of such REO Property ~~subsequent to the close of the third calendar year following the year in which such acquisition occurred~~ for an additional specified period will not ~~result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of any Trust REMIC, or~~ cause ~~any Trust REMIC~~ such REO Property to fail to qualify as ~~a REMIC under~~ "foreclosure property" within the meaning of Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of Section 860D(a) of the Code) at any time that any ~~of the Lower-Tier Regular Interests, the 000 Xxxxx Xxxxxx Regular Interests or the Regular Certificates~~ Certificate is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, in which case the Special Servicer shall sell such REO 77 Property within such ~~longer~~ two-year period as ~~is permitted~~ extended by such ~~REO Extension or~~ additional specified period subject to any conditions set forth in such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard~~Fund, shall dispose of any REO Property held by the Trust Fund ~~(i)~~ prior to the last day of ~~such~~ the period (taking into account extensions) by within which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section ~~3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property~~3.18. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders ~~and, if applicable, the related Serviced Companion Loan Holder,~~ solely for the purpose of its ~~prompt~~ disposition and sale in a manner which does not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) ~~or result in~~ of the ~~receipt by~~ Code (determined without regard to the ~~Trust Fund~~ exception applicable for purposes of ~~any “income from non-permitted assets” within~~ Section 860D(a)) of the ~~meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of any Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon any Trust REMIC or the Trust Fund~~Code. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property ~~(other than an REO Property related to an Outside Serviced Mortgage Loan)~~ as are consistent with ~~the~~ Servicing ~~Standard and the terms of this Agreement~~Standard, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s)))Certificateholders, and, in connection therewith, the Special Servicer shall ~~only~~ agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a taxstandards. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “"REO Account”"), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled (a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination), “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, "LaSalle National ~~Association~~Bank, as Trustee, in trust for ~~the benefit of the registered~~ Holders of ~~Citigroup Commercial Mortgage Trust 2019-C7~~Midland Realty Acceptance Corp., Commercial Mortgage Pass-Through Certificates, Series ~~2019~~1996-C7C2, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”. ." The Special Servicer shall be entitled to ~~withdraw for its account~~ any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section ~~3.07(b) of this Agreement~~3.7(b). The Special Servicer shall deposit or cause to be deposited in the related REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all ~~revenues and proceeds~~ REO Proceeds received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of ~~such REO Property and for other Property Protection Expenses with respect to~~ such REO Property, including: (i) all insurance premiums due and payable in respect of ~~any~~ such REO Property; (ii) all real estate taxes and assessments in respect of ~~any~~ such REO Property that may result in the imposition of a lien thereon;; and (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore ~~any REO Property including, if applicable, the payments of any ground rents in respect of~~ such REO Property~~; and (iv)~~ , including any ~~taxes imposed on any Trust REMIC in respect of net income from foreclosure~~ property ~~in accordance with Section 4.05 of this Agreement~~management fees. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iviii) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are dueabove, the ~~Master~~ Servicer shall ~~advance~~ make an Advance equal to the amount of such shortfall unless the ~~Master~~ Servicer determines, in ~~accordance with the Servicing Standard~~its good faith judgment, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The ~~Trustee shall be entitled to rely, conclusively, on any determination by the Master~~ Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent ~~set forth in~~ permitted pursuant to Section ~~3.06 and/or, if applicable, Section 3.06A of this Agreement~~3.6. The Special Servicer shall ~~withdraw~~ remit to the Servicer from each REO Account ~~and remit to the Master Servicer~~ for deposit ~~into~~ in the Collection ~~Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account,~~ Account on a monthly basis prior to the related ~~Master Servicer~~ Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from ~~each REO Property during~~ the related ~~Collection Period~~REO Property, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in ~~each~~ such REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New ~~Lease,~~ Lease if the New ~~Lease~~ Lease, by its ~~terms~~ terms, will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New ~~Lease,~~ Lease other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ~~ten percent~~ 10% of the construction of such building or other improvement was completed before default on the related Mortgage Loan ~~or Serviced Loan Combination~~ became imminent, all within the meaning of ~~Code~~ Section 856(e)(4)(B)) of the Code; or (iv) Directly Operate or perform any construction work on, or allow any Person (other than an Independent Contractor) to Directly Operate or perform any construction work on, any REO Property on on, any date more than 90 days after its date of acquisition by the Trust Fund~~, unless such Person is an Independent Contractor~~; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special ~~Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator~~ Servicer and the Trustee (which opinion shall be an expense of the Trust ~~Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder~~Fund) to the effect that such action will not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of ~~Code~~ Section 860D(a)) of the Code) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent ~~Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds,~~ Contractor for the operation and management of any REO ~~Property,~~ Property within 90 days of the Trust Fund’s 's acquisition thereof (unless the Special Servicer shall have provided the Trustee ~~and the Certificate Administrator~~ with an Opinion of Counsel that the operation and management of ~~any~~ such REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section ~~3.16(b~~3.17(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders ~~and, if applicable, any related Serviced Companion Loan Holder~~ with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) Promptly following any acquisition by the Trust Fund of an REO Property, the Special Servicer shall obtain (i) an update of any appraisal performed pursuant to Section 3.10 which is more than 12 months old, or (ii) to the extent that an appraisal has not been obtained pursuant to such Section, an appraisal of such REO Property by an Independent appraiser familiar with the area in which such REO Property is located in order to determine the fair market value of such REO Property and shall notify the Depositor and the Trustee of the results of such appraisal. Any such appraisal shall be conducted in accordance with MAI standards by an appraiser with at least five years experience in the relevant property type and the cost thereof shall be an expense of the Trust Fund. (d) When and as necessary, the Special Servicer shall send to the Trustee ~~and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section ~~3.16(a) and Section 3.16(b) of this Agreement~~3.17(b). ~~(d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.~~

Appears in 1 contract

Samples: Pooling and Servicing Agreement (Midland Realty Accept Corp Com Mort Pass THR Cert Se 1996 C2)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property ~~(other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan)~~ is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the applicable Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of ~~a nominee of~~ the ~~Trustee (which shall not include the Master Servicer)~~Trustee, or ~~a separate trustee or co-trustee~~its nominee, on behalf of the ~~Trust Fund~~ Certificateholders, and ~~any~~ itself as Holder of the related ~~Serviced Companion~~ Loan ~~Holders~~REMIC Regular Interest, the related Loan REMIC Residual Interest and the Lower-Tier Regular Interests. The Special Servicer, on behalf of the Trust Fund, shall ~~sell~~ dispose of any REO Property prior to the close of the third calendar year ~~following~~ beginning after the year in which the Trust Fund acquires ownership of such REO Property for purposes of Section 860G(a)(8) of the Code, unless (i) the Special Servicer on behalf of the Lower-Tier REMIC or the ~~000 Xxxxx Xxxxxx~~ related Loan REMIC, as applicable, ~~acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1),~~ has applied for ~~purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny)~~ an extension of ~~time (an “REO Extension”~~such period pursuant to Sections 856(e)(3) to and 860G(a)(8)(A) of the Code, in which case the Special Servicer shall sell such REO Property within the applicable extension period or (ii) the Special Servicer ~~obtains~~ seeks and subsequently receives an Opinion of Counsel ~~for~~ (which opinion shall be an expense of the ~~Special Servicer, the Certificate Administrator and the Trustee~~Trust Fund), addressed to the Special ~~Servicer, the Certificate Administrator~~ Servicer and ~~the~~ Trustee, to the effect that the holding by the ~~Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund of such REO Property ~~subsequent to the close of the third calendar year following the year in which such acquisition occurred~~ for an additional specified period will not ~~result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of any Trust REMIC, or~~ cause ~~any Trust REMIC~~ such REO Property to fail to qualify as ~~a REMIC under~~ "foreclosure property" within the meaning of Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of Section 860D(a) of the Code) at any time that any ~~of the Lower-Tier Regular Interests, the 000 Xxxxx Xxxxxx Regular Interests or the Regular Certificates~~ Certificate is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, ~~the Special Servicer~~ in which event such period shall ~~sell such REO Property within such longer period as is permitted~~ be extended by such ~~REO Extension or~~ additional specified period subject to any conditions set forth in such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard~~Fund, shall dispose of any REO Property held by the Trust Fund ~~(i)~~ prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section ~~3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property~~3.18 hereof. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders ~~and, if applicable, the related Serviced Companion Loan Holder,~~ solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) ~~or result in~~ of the ~~receipt by~~ Code (determined without regard to the ~~Trust Fund~~ exception applicable for purposes of ~~any “income from non-permitted assets” within the meaning of Code~~ Section ~~860F(a)(2)(B) or (i) endanger the status of any Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon any Trust REMIC or the Trust Fund~~860D(a)). (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property ~~(other than an REO Property related to an Outside Serviced Mortgage Loan)~~ as are consistent with the ~~Servicing Standard~~ manner in which the Special Servicer manages and operates similar property owned or managed by the ~~terms~~ Special Servicer or any of ~~this Agreement~~its Affiliates, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s)))Certificateholders, and, in connection therewith, the Special Servicer shall ~~only~~ agree to the payment of management fees that are consistent with general market ~~standards or to terms that are more favorable~~standards. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “"net income from foreclosure property,” " within the meaning of ~~Code~~ Section 860G(c)) of the Code, which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the ~~Certificate Administrator~~ Trustee in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “"REO Account”"), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled (a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination), “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, "LaSalle Bank National Association, as Trustee, in trust for ~~the benefit of the registered~~ Holders of ~~Citigroup~~ Commercial Mortgage ~~Trust 2019-C7~~Asset Trust, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~1999-C7C2, ~~[IN THE CASE OF AN~~ REO ~~PROPERTY RELATED TO A SERVICED LOAN COMBINATION:~~ Account." The REO Property and the related ~~Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b)~~ REO Account with respect to the ~~000~~ Geneva Crossing Loan and the Xxxxx X. Xxxxxx Loan ~~Combination, “[Name of Special Servicer],~~ shall be treated as ~~Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit~~ assets of the ~~registered Holders~~ related Loan REMIC for all purposes of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”this Agreement. The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b~~) of this Agreement~~). The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues ~~and proceeds~~ received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO ~~Property including, if applicable, the payments of any ground rents in respect of such REO~~ Property; and (iv) any taxes imposed on ~~any Trust~~ the Upper Tier REMIC, the Lower-Tier REMIC or the related Loan REMIC in respect of net income from foreclosure property in accordance with Section ~~4.05 of this Agreement~~4.05. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iviii) above and the Special Servicer has provided written notice of such shortfall to the ~~Master~~ Servicer at least five ~~(5)~~ Business Days (oror such lesser period as may be necessary, in ~~an emergency situation or~~ the reasonable opinion of the Special Servicer, to prevent a material adverse effect on ~~an urgent basis,~~ any Mortgaged Property but in no event less than two ~~(2)~~ Business Days~~, provided that the written notice sets forth the nature of the emergency or the basis of the urgency~~) prior to the date that such amounts are due, the ~~Master~~ Servicer shall advance the amount of such shortfall as a Property Advance unless the ~~Master~~ Servicer determines, in ~~accordance with the Servicing Standard~~its good faith judgment, that such Advance would be a Nonrecoverable Advance; provided, however, the Special Servicer shall make reasonable efforts to request Advances once in any 30 day period to satisfy all such shortfalls. The Special Servicer shall reasonably cooperate with the Servicer in providing any information required to determine whether an Advance (would be a Nonrecoverable Advance and the Servicer shall reasonably cooperate with the Special Servicer in ~~which case such costs shall~~ providing any information required to determine whether an Advance would be ~~an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account)~~a Nonrecoverable Advance. If the ~~Master~~ Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such ~~Advance unless~~ Advance; and if the Trustee fails to make any such Advance, the Fiscal Agent shall make such Advance, unless in either case, the Trustee or the Fiscal Agent determines that such Advance would be a Nonrecoverable Advance. The Trustee and the Fiscal Agent shall be entitled to rely, conclusively, on any determination by the ~~Master~~ Servicer that an Advance, if made, would be a Nonrecoverable Advance. The ~~Trustee~~Trustee and the Fiscal Agent, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall ~~use its good faith business judgment~~be subject to the standards applicable to the Servicer hereunder. The ~~Master Servicer~~ Servicer, the Trustee or the ~~Trustee~~Fiscal Agent, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section ~~3.06 and/or, if applicable, Section 3.06A of this Agreement~~3.06. The Special Servicer shall withdraw from each REO Account and remit to the ~~Master~~ Servicer for deposit into the Collection ~~Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account,~~ Account on a monthly basis prior to or on the related ~~Master Servicer Remittance~~ Due Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from each REO ~~Property during the related Collection Period~~Property, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan ~~or Serviced Loan Combination~~ became imminent, all within the meaning of ~~Code~~ Section 856(e)(4)(B)) of the Code; or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special ~~Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator~~ Servicer and the Trustee (which opinion shall be an expense of the Trust ~~Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder~~Fund) to the effect that such action will not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of ~~Code~~ Section 860D(a)) of the Code) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent ~~Contractor,~~ Contractor the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s 's acquisition thereof (unless the Special Servicer shall have provided the Trustee ~~and the Certificate Administrator~~ with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than ~~thirty~~ 30 days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section ~~3.16(b~~3.17(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders ~~and, if applicable, any related Serviced Companion Loan Holder~~ with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) Promptly following any acquisition by the Trust Fund of an REO Property, the Special Servicer shall obtain an Updated Appraisal thereof, but only in the event that any Appraisal or Updated Appraisal with respect thereto is more than 12 months old, in order to determine the fair market value of such REO Property and shall notify the Depositor, the Servicer and the Trustee hereto of the results of such appraisal. Any such appraisal shall be conducted by an appraiser who is an MAI and the cost thereof shall be an expense of the Trust Fund. The Special Servicer shall obtain a new Updated Appraisal or a letter update every 12 months thereafter. (d) When and as necessary, the Special Servicer shall ~~send~~ deliver to the Trustee ~~and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with ~~Section 3.16(a~~Sections 3.17(a) and ~~Section 3.16(b) of this Agreement~~3.17(b). ~~(d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.~~

Appears in 1 contract

Samples: Pooling and Servicing Agreement (Asset Securitization Corp Com Mor Ps THR Cert Ser 1999-C2)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property (other than a Mortgaged Property with respect to ~~an Outside~~ a Non-Serviced Mortgage Loan) is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced ~~Loan Combination~~Whole Loan, for the benefit of the ~~applicable~~ Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders ~~and, if applicable, such~~ and Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund or by a single member limited liability company established for that purpose) in foreclosure, by ~~deed-in-~~deed in lieu of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or certificate of sale shall be taken in the name of a nominee of the Trustee (which shall not include the Master Servicer), or a separate trustee or co-trustee, on behalf of the Trust Fund and ~~any~~ the related ~~Serviced~~ Companion Loan Holders. The Special Servicer, on behalf of the Trust Fund, shall sell any REO Property prior to the close of the third calendar year following the year in which the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ acquires ownership of such REO Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1), for purposes of Code Section 860G(a)(8), unless (i) the IRS grants (or does not deny) an extension of time (an “REO Extension”) to sell such REO Property or (ii) the Special Servicer obtains an Opinion of Counsel for the Special Servicer, the Certificate Administrator and the Trustee, addressed to the Special Servicer, the Certificate Administrator and the Trustee, to the effect that the holding by the Lower-Tier REMIC ~~or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ of such REO Property subsequent to the close of the third calendar year following the year in which such acquisition occurred will not result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of ~~any~~ either Trust REMIC, or cause ~~any~~ either Trust REMIC to fail to qualify as a REMIC under the Code for federal income tax purposes at any time that any ~~of the Lower-Tier Regular Interests, the 000 Xxxxx Xxxxxx Regular Interests or the Regular Certificates~~ Certificate is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, the Special Servicer shall sell such REO Property within such longer period as is permitted by such REO Extension or such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust Fund and any related ~~Serviced~~ Companion Loan Holder, in accordance with the Servicing Standard, shall dispose of any REO Property held by the Trust Fund (i) prior to the last day of such period (taking into account extensions) by which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section 3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan Holder, solely for the purpose of its prompt disposition and sale in a manner which does not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) or result in the receipt by the Trust Fund of any “income from non-permitted assets” within the meaning of Code Section 860F(a)(2)(B) or or (i) endanger the status of ~~any~~ either Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon ~~any~~ either Trust REMIC or the Trust Fund~~. (b)~~ . The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property (other than ~~an REO Property related~~ with respect to ~~an Outside~~ any Non-Serviced Mortgage Loan) as are consistent with the Servicing Standard and the terms of this Agreement, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related ~~Serviced~~ Companion Loan ~~Holder(s)~~ Holder constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender), and, in connection therewith, the Special Servicer shall only agree to the payment of management fees that ~~are~~ it determines in its reasonable business judgment to be substantially consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), ) constituted a single ~~lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))~~lender) than an alternative method of operation or rental of such REO Property that would not be subject to such a tax. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “REO Account”), each of which shall be an Eligible Account and (subject to any changes in the identities of the Special Servicer ~~and/or~~ or the Trustee) shall be entitled ~~(a) with respect to each~~ “Midland Loan Services, a Division of ~~the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination)~~PNC Bank, ~~“[Name of Special Servicer]~~National Association, as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the ~~benefit of the~~ registered Holders of ~~Citigroup~~ CSAIL 2015-C4 Commercial Mortgage ~~Trust 2019-C7~~Trust, Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2015-~~C7,~~ C4 [~~IN THE CASE OF AN~~ in the case of an REO ~~PROPERTY RELATED TO A SERVICED LOAN COMBINATION~~Property related to a Whole Loan: and the related ~~Serviced~~ Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan HoldersHolder, as their interests may appear--], REO Account”. .” The Special Servicer shall be entitled to withdraw for its account any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section 3.07(b) of this Agreement. The Special Servicer shall deposit or cause to be deposited in the REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all revenues ~~and proceeds~~ received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds, which shall be remitted to the Collection Account), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO Property and for other Property Protection Expenses with respect to such REO Property, including: (i) all insurance premiums due and payable in respect of any REO Property; (ii) all real estate taxes and assessments in respect of any REO Property that may result in the imposition of a lien thereon; (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore any REO Property including, if applicable, the payments of any ground rents in respect of such REO Property; and (iv) any taxes imposed on ~~any~~ either Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iv) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are due, the Master Servicer shall advance the amount of such shortfall unless the Master Servicer determines, in accordance with the Servicing Standard, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The Trustee shall be entitled to ~~rely, conclusively,~~ rely conclusively on any determination by the Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent set forth in Section 3.06 and/or, if applicable, Section 3.06A of this Agreement. The Special Servicer shall withdraw from each REO Account and remit to the Master Servicer for deposit into the Collection Account, or, for a Serviced ~~Loan Combination~~Whole Loan, the related Serviced Whole Loan ~~Combination~~ Custodial Account, on a monthly basis prior to the related Master Servicer Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from each REO Property during the related ~~Collection~~ Prepayment Period, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in each REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New Lease, if the New Lease by its terms will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New Lease, other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ten percent of the construction of such building or other improvement was completed before default on the related Mortgage Loan or Serviced Whole Loan ~~Combination~~ became imminent, all within the meaning of Code Section 856(e)(4)(B); or (iv) Directly Operate or allow any Person to Directly Operate any REO Property on any date more than 90 days after its date of acquisition by the Trust Fund, unless such Person is an Independent Contractor; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special Servicer, ~~any~~ the related ~~Serviced~~ Companion Loan Holder, the Certificate Administrator and the Trustee (which opinion shall be an expense of the Trust Fund and, if ~~any~~ the related ~~Serviced~~ Companion Loan is part of a REMIC, the related ~~Serviced~~ Companion Loan Holder) to the effect that such action will not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8) (determined without regard to the exception applicable for purposes of Code Section 860D(a)) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds, for the operation and management of any REO Property, within 90 days of the Trust Fund’s acquisition thereof (unless the Special Servicer shall have provided the Trustee and the Certificate Administrator with an Opinion of Counsel that the operation and management of any REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “foreclosure property” within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section ~~3.16(b~~3.16(a) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders and, if applicable, ~~any~~ the related ~~Serviced~~ Companion Loan Holder with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (cb) When and as necessary, the Special Servicer shall send to the Trustee and the Certificate Administrator and the related ~~Serviced~~ Companion Loan Holder ~~(or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section 3.16(a) ~~and Section 3.16(b)~~ of this Agreement. (dc) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to ~~an Outside~~ a Non-Serviced Mortgage Loan.

Appears in 1 contract

Samples: Pooling and Servicing Agreement (CSAIL 2015-C4 Commercial Mortgage Trust)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property ~~(other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan)~~ is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the applicable Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund in foreclosure or by ~~a single member limited liability company established for that purpose)~~ deed in ~~foreclosure, by deed-in-~~lieu of ~~foreclosure or upon abandonment or reclamation from bankruptcy~~foreclosure, the deed or certificate of sale shall be taken in the name of a the Trustee, or its nominee ~~of the Trustee~~ (which shall not include the ~~Master~~ Servicer or the Special Servicer), or a separate trustee or co-trustee, on behalf of the Trust ~~Fund~~ Fund. The Special Servicer shall maintain accurate records with respect to each related REO Property reflecting the status of taxes, assessments and ~~any related Serviced Companion Loan Holders~~other similar items that are or may become a lien on such REO Property and the status of insurance premiums payable with respect thereto. The Special Servicer, on behalf of the Trust Fund, shall ~~sell~~ dispose of any REO Property ~~prior to~~ within two years after the ~~close of the third calendar year following the year in which the Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund acquires ownership of such REO ~~Property, within the meaning of Treasury Regulations Section 1.856-6(b)(1),~~ Property for purposes of ~~Code~~ Section 860G(a)(8)) of the Code, unless (i) the ~~IRS grants (or does not deny)~~ Special Servicer, on behalf of REMIC I, has applied for and received an extension of ~~time (an “REO Extension”~~such two-year period pursuant to Sections 856(e)(3) to and 860G(a)(8)(A) of the Code, in which case the Special Servicer shall sell such REO Property within the applicable extension period or (ii) the Special Servicer ~~obtains~~ seeks and subsequently receives an Opinion of Counsel ~~for~~ (which opinion shall be an expense of the ~~Special Servicer, the Certificate Administrator and the Trustee~~Trust Fund), addressed to the Special ~~Servicer, the Certificate Administrator~~ Servicer and the Trustee, to the effect that the holding by the ~~Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund of such REO Property ~~subsequent to the close of the third calendar year following the year in which such acquisition occurred~~ for an additional specified period will not ~~result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of any Trust REMIC, or~~ cause ~~any Trust REMIC~~ such REO Property to fail to qualify as ~~a REMIC under~~ "foreclosure property" within the meaning of Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of Section 860D(a) of the Code) at any time that any ~~of the Lower-Tier Regular Interests, the 000 Xxxxx Xxxxxx Regular Interests or the Regular Certificates~~ Certificate is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, in which case the Special Servicer shall sell such REO Property within such ~~longer~~ two-year period as ~~is permitted~~ extended by such ~~REO Extension or~~ additional specified period subject to any conditions set forth in such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard~~Fund, shall dispose of any REO Property held by the Trust Fund ~~(i)~~ prior to the last day of ~~such~~ the period (taking into account extensions) by within which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section ~~3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property~~3.18. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders ~~and, if applicable, the related Serviced Companion Loan Holder,~~ solely for the purpose of its ~~prompt~~ disposition and sale in a manner which does not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) ~~or result in~~ of the ~~receipt by~~ Code (determined without regard to the ~~Trust Fund~~ exception applicable for purposes of ~~any “income from non-permitted assets” within~~ Section 860D(a)) of the ~~meaning of Code Section 860F(a)(2)(B) or (i) endanger the status of any Trust REMIC as a REMIC or (ii) result in the imposition of a tax upon any Trust REMIC or the Trust Fund~~Code. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property ~~(other than an REO Property related to an Outside Serviced Mortgage Loan)~~ as are consistent with the ~~Servicing Standard~~ manner in which the Special Servicer manages and operates similar property owned or managed by the ~~terms~~ Special Servicer or any of ~~this Agreement~~its Affiliates, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s)))Certificateholders, and, in connection therewith, the Special Servicer shall ~~only~~ agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a taxstandards. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “"REO Account”"), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled (a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination), “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, "LaSalle National ~~Association~~Bank, as Trustee, in trust for ~~the benefit of the registered~~ Holders of ~~Citigroup Commercial Mortgage Trust 2019-C7~~Midland Realty Acceptance Corp., Commercial Mortgage Pass-Through Certificates, Series ~~2019~~1996-C7C1, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”. ." The Special Servicer shall be entitled to ~~withdraw for its account~~ any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section ~~3.07(b) of this Agreement~~3.7(b). The Special Servicer shall deposit or cause to be deposited in the related REO ~~Account,~~ Account within ~~two (2)~~ one Business ~~Days~~ Day after receipt ~~of properly identified funds,~~ all ~~revenues and proceeds~~ REO Proceeds received by it with respect to any REO ~~Property~~Property (other than Liquidation Proceeds), and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of ~~such REO Property and for other Property Protection Expenses with respect to~~ such REO Property, including: (i) all insurance premiums due and payable in respect of ~~any~~ such REO Property; (ii) all real estate taxes and assessments in respect of ~~any~~ such REO Property that may result in the imposition of a lien thereon;; and (iii) all costs and expenses reasonable and necessary to protect, maintain, manage, operate, repair and restore ~~any REO Property including, if applicable, the payments of any ground rents in respect of~~ such REO Property~~; and (iv)~~ , including any ~~taxes imposed on any Trust REMIC in respect of net income from foreclosure~~ property ~~in accordance with Section 4.05 of this Agreement~~management fees. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iviii) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are dueabove, the ~~Master~~ Servicer shall ~~advance~~ make an Advance equal to the amount of such shortfall unless the ~~Master~~ Servicer determines, in ~~accordance with the Servicing Standard~~its good faith judgment, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The ~~Trustee shall be entitled to rely, conclusively, on any determination by the Master~~ Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent ~~set forth in~~ permitted pursuant to Section ~~3.06 and/or, if applicable, Section 3.06A of this Agreement~~3.6. The Special Servicer shall ~~withdraw~~ remit to the Servicer from each REO Account ~~and remit to the Master Servicer~~ for deposit ~~into~~ in the Collection ~~Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account,~~ Account on a monthly basis prior to the related ~~Master Servicer~~ Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from ~~each REO Property during~~ the related ~~Collection Period~~REO Property, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in ~~each~~ such REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall not: (i) permit the Trust Fund to enter into, renew or extend any New ~~Lease,~~ Lease if the New ~~Lease~~ Lease, by its ~~terms~~ terms, will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New ~~Lease,~~ Lease other than amounts that will constitute Rents from Real Property; (iii) authorize or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ~~ten percent~~ 10% of the construction of such building or other improvement was completed before default on the related Mortgage Loan ~~or Serviced Loan Combination~~ became imminent, all within the meaning of ~~Code~~ Section 856(e)(4)(B)) of the Code; or (iv) Directly Operate or perform any construction work on, or allow any Person (other than an Independent Contractor) to Directly Operate or perform any construction work on, any REO Property on on, any date more than 90 days after its date of acquisition by the Trust Fund~~, unless such Person is an Independent Contractor~~; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special ~~Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator~~ Servicer and the Trustee (which opinion shall be an expense of the Trust ~~Fund and, if any related Serviced Companion Loan is part of a REMIC, the related Serviced Companion Loan Holder~~Fund) to the effect that such action will not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of ~~Code~~ Section 860D(a)) of the Code) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent ~~Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds,~~ Contractor for the operation and management of any REO ~~Property,~~ Property within 90 days of the Trust Fund’s 's acquisition thereof (unless the Special Servicer shall have provided the Trustee ~~and the Certificate Administrator~~ with an Opinion of Counsel that the operation and management of ~~any~~ such REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of Code Section 860G(a)(8)) (which opinion shall be an expense of the Trust Fund), provided that: (i) the terms and conditions of any such contract shall be reasonable and customary for the area and type of property and shall not be inconsistent herewith; (ii) any such contract shall require, or shall be administered to require, that the Independent Contractor pay all costs and expenses incurred in connection with the operation and management of such REO Property, including those listed above, and remit all related revenues (net of such costs and expenses) to the Special Servicer as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor; (iii) none of the provisions of this Section ~~3.16(b~~3.17(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders ~~and, if applicable, any related Serviced Companion Loan Holder~~ with respect to the operation and management of any such REO Property; and (iv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder 84 for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) Promptly following any acquisition by the Trust Fund of an REO Property, the Special Servicer shall obtain (i) an update of any appraisal performed pursuant to Section 3.10 which is more than 12 months old, or (ii) to the extent that an appraisal has not been obtained pursuant to such Section, an appraisal of such REO Property by an Independent appraiser familiar with the area in which such REO Property is located in order to determine the fair market value of such REO Property and shall notify the Depositor and the Trustee of the results of such appraisal. Any such appraisal shall be conducted in accordance with MAI standards and the cost thereof shall be an expense of the Trust Fund. (d) When and as necessary, the Special Servicer shall send to the Trustee ~~and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section ~~3.16(a) and Section 3.16(b) of this Agreement~~3.17(b). ~~(d) Notwithstanding anything to the contrary, this Section 3.16 shall not apply to any REO Property related to an Outside Serviced Mortgage Loan.~~

Appears in 1 contract

Samples: Pooling and Servicing Agreement (Midland Realty Accept Corp Com Mort Pass THR Cert Se 1996-C1)

Title and Management of REO Properties. (a) In the event that title to any Mortgaged Property ~~(other than a Mortgaged Property with respect to an Outside Serviced Mortgage Loan)~~ is acquired for the benefit of ~~the applicable~~ Certificateholders (or, with respect to a Serviced Loan Combination, for the benefit of the applicable Certificateholders and the related Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender) (either by the Trust Fund in foreclosure or by ~~a single member limited liability company established for that purpose)~~ deed in ~~foreclosure, by deed-in-~~lieu of ~~foreclosure or upon abandonment or reclamation from bankruptcy~~foreclosure, the deed or certificate of sale shall be taken in the name of a the Trustee, or its nominee ~~of the Trustee~~ (which shall not include the Master Servicer or the Special Servicer), or a separate trustee or co-trustee, on behalf of the Trust ~~Fund~~ Fund. The Special Servicer shall maintain accurate records with respect to each related REO Property reflecting the status of taxes, assessments and ~~any related Serviced Companion Loan Holders~~other similar items that are or may become a lien on such REO Property and the status of insurance premiums payable with respect thereto. The Special Servicer, on behalf of the Trust Fund, shall ~~sell~~ dispose of any REO Property ~~prior to~~ within three taxable years after the close of the ~~third calendar year following the~~ taxable year in which the ~~Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund acquires ownership of such REO ~~Property, within~~ Property (the ~~meaning of Treasury Regulations Section 1.856-6(b)(1),~~ "REO Grace Period") for purposes of ~~Code~~ Section 860G(a)(8)) of the Code, unless (i) the ~~IRS grants (or does not deny)~~ Special Servicer, on behalf of REMIC I, has timely applied for and received an extension of ~~time (an “~~such REO ~~Extension”~~Grace Period pursuant to Sections 856(e)(3) to and 860G(a)(8)(A) of the Code, in which case the Special Servicer shall sell such REO Property by the end of the applicable extension period or (ii) the Special Servicer ~~obtains~~ seeks and subsequently receives an Opinion of Counsel ~~for~~ (the ~~Special Servicer~~cost of such opinion shall be advanced as a Servicing Advance, ~~the Certificate Administrator and the Trustee~~unless it would be a Nonrecoverable Advance), addressed to the Special ~~Servicer, the Certificate Administrator~~ Servicer and the Trustee, to the effect that the holding by the ~~Lower-Tier REMIC or the 000 Xxxxx Xxxxxx REMIC, as applicable,~~ Trust Fund of such REO Property ~~subsequent to the close of the third calendar year following the year in which such acquisition occurred~~ for an additional specified period will not ~~result in the imposition of taxes on “prohibited transactions” (as defined in Code Section 860F) of any Trust REMIC, or~~ cause ~~any Trust REMIC~~ such REO Property to fail to qualify as ~~a REMIC under~~ "foreclosure property" within the meaning of Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of Section 860D(a) of the Code) at any time that any ~~of the Lower-Tier Regular Interests, the 000 Xxxxx Xxxxxx Regular Interests or the Regular Certificates~~ Certificate is outstanding. If the Special Servicer is granted (or is not denied) the REO Extension contemplated by clause (i) of the immediately preceding sentence or obtains the Opinion of Counsel contemplated by clause (ii) of the immediately preceding sentence, in which case the Special Servicer shall sell such REO Property ~~within~~ by the end of such ~~longer period as is permitted by such REO Extension or~~ additional period, subject to any conditions set forth in such Opinion of Counsel, as the case may be. Any expense incurred by the Special Servicer in connection with its receiving the REO Extension contemplated by clause (i) of the second preceding sentence or its obtaining the Opinion of Counsel contemplated by clause (ii) of the second preceding sentence shall be an expense of the Trust Fund payable out of the Collection Account pursuant to Section 3.06(a) of this Agreement. The Special Servicer, on behalf of the Trust ~~Fund and any related Serviced Companion Loan Holder, in accordance with the Servicing Standard~~Fund, shall dispose of any REO Property held by the Trust Fund ~~(i)~~ prior to the last day of ~~such~~ the period (taking into account extensions) by within which such REO Property is required to be disposed of pursuant to the provisions of the immediately preceding sentence in a manner provided under Section ~~3.17 of this Agreement and (ii) on the same terms and conditions as if it were the owner of such REO Property~~3.18. The Special Servicer shall manage, conserve, protect and operate each REO Property for the Certificateholders ~~and, if applicable, the related Serviced Companion Loan Holder,~~ solely for the purpose of its ~~prompt~~ disposition and sale in a manner which does not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) or of the Code (determined without regard to the exception applicable for purposes of Section 860D(a)) of the Code or, except as contemplated by Section 3.17(d), result in the receipt by ~~the Trust Fund~~ REMIC I of any “"income from non-permitted assets” " within the meaning of ~~Code~~ Section 860F(a)(2)(B) ~~or (i) endanger~~ of the ~~status~~ Code, in an Adverse REMIC Event in respect of any of the REMICs or in an Adverse Grantor Trust ~~REMIC as a REMIC or (ii) result in the imposition of a tax upon any Trust REMIC or the Trust Fund~~Event. (b) The Special Servicer shall have full power and authority, subject only to the specific requirements and prohibitions of this Agreement, to do any and all things in connection with any REO Property ~~(other than an REO Property related to an Outside Serviced Mortgage Loan)~~ as are consistent with ~~the~~ Servicing ~~Standard and the terms of this Agreement~~Standard, all on such terms and for such period as the Special Servicer deems to be in the best interests of Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s)))Certificateholders, and, in connection therewith, the Special Servicer shall ~~only~~ agree to the payment of management fees that are consistent with general market standards or to terms that are more favorable. Consistent with the foregoing, the Special Servicer shall cause or permit to be earned with respect to such REO Property any “net income from foreclosure property,” within the meaning of Code Section 860G(c), which is subject to tax under the REMIC Provisions only if it has determined, and has so advised the Certificate Administrator in writing, that the earning of such income on a net after-tax basis could reasonably be expected to result in a greater recovery on behalf of Certificateholders and, if applicable, the related Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, the related Companion Loan Holder(s), constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of any related Subordinate Companion Loan(s))) than an alternative method of operation or rental of such REO Property that would not be subject to such a taxstandards. The Special Servicer shall segregate and hold all revenues received by it with respect to any REO Property separate and apart from its own funds and general assets and shall establish and maintain with respect to any REO Property a segregated custodial account (each, an “"REO Account”"), each of which shall be an Eligible Account and ~~(subject to any changes in the identities of the Special Servicer and/or the Trustee)~~ shall be entitled (a) with respect to each of the Mortgage Loans (other than any Outside Serviced Mortgage Loan) and any Serviced Loan Combinations (other than the 000 Xxxxx Xxxxxx Loan Combination), “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, "LaSalle Bank National Association, as Trustee, in trust for ~~the benefit of the registered~~ Holders of ~~Citigroup Commercial~~ PNC Mortgage ~~Trust 2019-C7~~Acceptance Corp., Commercial Mortgage Pass-Through Certificates, Series ~~2019~~2000-C7C1, [IN THE CASE OF AN REO PROPERTY RELATED TO A SERVICED LOAN COMBINATION: and the related Serviced Companion Loan Holder(s), as their interests may appear]--REO Account”; and (b) with respect to the 000 Xxxxx Xxxxxx Loan Combination, “[Name of Special Servicer], as Special Servicer, on behalf of Wilmington Trust, National Association, as Trustee, for the benefit of the registered Holders of Citigroup Commercial Mortgage Trust 2019-C7, Commercial Mortgage Pass Through Certificates, Series 2019-C7, and the related Serviced Companion Loan Holders, as their interests may appear--REO Account”. ." The Special Servicer shall be entitled to ~~withdraw for its account~~ any interest or investment income earned on funds deposited in an REO Account to the extent provided in Section ~~3.07(b) of this Agreement~~3.7(b). The Special Servicer shall deposit or cause to be deposited in the related REO ~~Account,~~ Account within two ~~(2)~~ Business Days after receipt ~~of properly identified funds,~~ all ~~revenues and proceeds~~ REO Proceeds received by it with respect to any REO Property, and shall withdraw therefrom funds necessary for the proper operation, management and maintenance of such REO ~~Property and for other Property Protection Expenses with respect to such REO~~ Property, including: (i) all insurance premiums and ground rents, if any, due and payable in respect of ~~any~~ such REO Property; (ii) all real estate taxes and assessments in respect of ~~any~~ such REO Property and such other Mortgaged Properties that may result in the imposition of a lien thereon;; and (iii) all costs and expenses ~~reasonable and~~ necessary to protect, maintain, manage, operate, repair and restore ~~any REO Property including, if applicable, the payments of any ground rents in respect of~~ such REO Property~~; and (iv) any taxes imposed on any Trust REMIC in respect of net income from foreclosure property in accordance with Section 4.05 of this Agreement~~. To the extent that such REO Proceeds are insufficient for the purposes set forth in clauses (i) through (iviii) above and the Special Servicer has provided written notice of such shortfall to the Master Servicer at least five (5) Business Days (or, in an emergency situation or on an urgent basis, two (2) Business Days, provided that the written notice sets forth the nature of the emergency or the basis of the urgency) prior to the date that such amounts are dueabove, the Master Servicer shall ~~advance~~ make an Advance equal to the amount of such shortfall unless the Master Servicer determines, in ~~accordance with the Servicing Standard~~its good faith judgment, that such Advance would be a Nonrecoverable Advance (in which case such costs shall be an expense of the Trust Fund and paid by the Master Servicer out of the Collection Account). If the Master Servicer does not make any such Advance in violation of the immediately preceding sentence, the Trustee shall make such Advance unless the Trustee determines that such Advance would be a Nonrecoverable Advance. The ~~Trustee shall be entitled to rely, conclusively, on any determination by the~~ Master Servicer that an Advance, if made, would be a Nonrecoverable Advance. The Trustee, in determining whether or not a proposed Advance would be a Nonrecoverable Advance, shall use its good faith business judgment. The Master Servicer or the Trustee, as applicable, shall be entitled to reimbursement of such Advances (with interest at the Advance Rate) made pursuant to the preceding sentence, to the extent ~~set forth in~~ permitted pursuant to Section ~~3.06 and/or, if applicable, Section 3.06A of this Agreement~~3.6. The Special Servicer shall ~~withdraw from each REO Account and~~ remit to the Master Servicer from each REO Account for deposit ~~into~~ in the Collection ~~Account, or, for a Serviced Loan Combination, the related Loan Combination Custodial Account,~~ Account on a monthly basis prior to the related ~~Master Servicer~~ Remittance Date ~~(but not earlier than two (2) Business Days after such amounts are received and properly identified)~~ the Net REO ~~Proceeds, Net Liquidation Proceeds, Net Condemnation Proceeds and Net Insurance~~ Proceeds received or collected from ~~each REO Property during~~ the related ~~Collection Period~~REO Property, except that in determining the amount of ~~any~~ such Net REO Proceeds, the Special Servicer may retain in ~~each~~ such REO Account reasonable reserves for repairs, replacements and necessary capital improvements and other related expenses. Notwithstanding the foregoing, the Special Servicer shall ~~not:~~not (unless permitted pursuant to subsection (d) below): (i) permit the Trust Fund to enter into, renew or extend any New ~~Lease,~~ Lease if the New ~~Lease~~ Lease, by its ~~terms~~ terms, will give rise to any income that does not constitute Rents from Real Property; (ii) permit any amount to be received or accrued under any New ~~Lease,~~ Lease other than amounts that will constitute Rents from Real Property; (iii) ~~authorize~~ authorize, perform or permit any construction on any REO Property, other than the repair or maintenance thereof or the completion of a building or other improvement thereon, and then only if more than ~~ten percent~~ 10% of the construction of such building or other improvement was completed before default on the related Mortgage Loan ~~or Serviced Loan Combination~~ became imminent, all within the meaning of ~~Code~~ Section 856(e)(4)(B)) of the Code; or (iv) Directly Operate or allow any Person (other than an Independent Contractor) to Directly Operate any REO Property on on, any date more than 90 days after its date of acquisition by the Trust Fund~~, unless such Person is an Independent Contractor~~; unless, in any such case, the Special Servicer has requested and received an Opinion of Counsel addressed to the Special ~~Servicer, any related Serviced Companion Loan Holder, the Certificate Administrator~~ Servicer and the Trustee (~~which~~ the cost of such opinion shall be ~~an expense of the Trust Fund and, if any related Serviced Companion Loan is part of~~ advanced as a ~~REMIC, the related Serviced Companion Loan Holder~~Servicing Advance unless such Advance would be a Nonrecoverable Advance) to the effect that such action will not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of ~~Code~~ Section 860G(a)(8) of the Code (determined without regard to the exception applicable for purposes of ~~Code~~ Section 860D(a)) of the Code) at any time that it is held by the Trust Fund, in which case the Special Servicer may take such actions as are specified in such Opinion of Counsel. The Special Servicer shall be required to contract with an Independent ~~Contractor, the fees and expenses of which shall be an expense of the Trust Fund and payable out of REO Proceeds,~~ Contractor for the operation and management of any REO ~~Property,~~ Property within 90 days of the Trust Fund’s 's acquisition thereof (unless the Special Servicer shall have provided the Trustee ~~and the Certificate Administrator~~ with an Opinion of Counsel that the operation and management of ~~any~~ such REO Property other than through an Independent Contractor shall not cause such REO Property to fail to qualify as “"foreclosure property” " within the meaning of Code Section 860G(a)(8)) (~~which~~ the cost of such opinion shall be ~~an expense of the Trust Fund~~advanced as a Servicing Advance unless such Advance would be a Nonrecoverable Advance), provided that: (i) the terms and conditions of any such contract shall not be inconsistent herewith and shall reflect an arm's length agreement; (ii) the fees of such Independent Contractor (which shall be an expense of the Trust Fund) shall be reasonable and customary ~~for~~ in light of the ~~area~~ nature and ~~type~~ locality of ~~property~~ the REO Property, the services rendered and ~~shall not be inconsistent herewith~~other relevant factors; (iiiii) any such contract shall require, or shall be administered to require, that the Independent Contractor (A) pay all costs and expenses incurred in connection with the operation and management of such REO Property, ~~including those listed above,~~ and (B) remit all related revenues collected (net of its fees and such costs and expenses) to the Special Servicer ~~as soon as practicable, but in no event later than thirty days following the receipt thereof by such Independent Contractor~~upon receipt; (~~iii~~iv) none of the provisions of this Section ~~3.16(b~~3.17(b) relating to any such contract or to actions taken through any such Independent Contractor shall be deemed to relieve the Special Servicer of any of its duties and obligations to the Trust Fund or the Trustee on behalf of the Certificateholders ~~and, if applicable, any related Serviced Companion Loan Holder~~ with respect to the operation and management of any such REO Property; and (ivv) the Special Servicer shall be obligated with respect thereto to the same extent as if it alone were performing all duties and obligations in connection with the operation and management of such REO Property. The Special Servicer shall be entitled to enter into any agreement with any Independent Contractor performing services for it related to its duties and obligations hereunder for indemnification of the Special Servicer by such Independent Contractor, and nothing in this Agreement shall be deemed to limit or modify such indemnification. (c) When and as necessary, the Special Servicer shall send to the Trustee ~~and the Certificate Administrator and the related Serviced Companion Loan Holder (or the master servicer or special servicer for the related Other Securitization Trust on its behalf)~~ a statement prepared by the Special Servicer setting forth the amount of net income or net loss, as determined for federal income tax purposes, resulting from the operation and management of a trade or business on, the furnishing or rendering of a non-customary service to the tenants of, or the receipt of any other amount not constituting Rents from Real Property in respect of, any REO Property in accordance with Section ~~3.16(a) and Section 3.16(b) of this Agreement~~3.17(b). (d) ~~Notwithstanding anything~~ Promptly following any acquisition by the Trust Fund of an REO Property, the Special Servicer shall obtain (i) an update of any appraisal performed pursuant to Section 3.23 which is more than 12 months old, or (ii) to the ~~contrary~~extent that an appraisal has not been obtained pursuant to such Section, ~~this Section 3.16 shall not apply to any~~ an appraisal of such REO Property ~~related~~ by an Independent appraiser familiar with the area in which such REO Property is located in order to determine the fair market value of such REO Property and shall notify the Depositor and the Trustee of the results of such appraisal. Any such appraisal shall be conducted in accordance with MAI standards by an ~~Outside Serviced Mortgage Loan~~appraiser with at least 5 years experience in the relevant property type and in the jurisdiction in which the Mortgaged Property is located and the cost thereof shall be reimbursable as a Servicing Advance.

Appears in 1 contract

Samples: Pooling and Servicing Agreement (PNC Mort Sec Corp Com Mort Pass THR Cert Ser 2000-C1)

Common use of Title and Management of REO Properties Clause in Contracts