Common use of REIT Covenants Clause in Contracts

REIT Covenants. The Borrower covenants that at loan inception and anytime thereafter when any non-real estate or non-cash is acquired: (a) the value of the real property (within the meaning of Treas. Reg. § 1.856-3(d) (the “Real Property”)) owned by the Property LLCs shall be at least eighty-five percent (85%) of the value of all of the assets of Borrower; (b) the value of the Real Property owned by the Property LLCs shall equal or exceed the amount due under this Note , (c) TRSCo shall at all times own all of the membership interests in the Property LLCs, which are and will continue to be disregarded as separate from TRSCo for U.S. federal income tax purposes, and (d) TRSCo shall not own any Real Property directly (and shall own all Real Property indirectly through the Property LLCs). For purposes of this paragraph, the value of the Real Property shall be reduced by any liens encumbering the Real Property, other than the liens securing this Note, as well as by the amount of any other liabilities of the Property LLCs, that are, in each case, senior to the Note and any instrument securing this note and creating a security interest against the Real Property. The covenants set forth in clauses (a)-(d) above are intended to cause the Note to be treated as a “real estate asset” under Section 865(c)(5) of the Internal Revenue Code of 1986, as amended, Treas. Reg. § 1.856-5, and IRS Revenue Procedure 2003-65 and shall be interpreted consistently therewith.

REIT Covenants. The Borrower covenants that at loan inception and anytime thereafter when any non-real estate or non-cash is acquired: (a) the value of the real property (within the meaning of Treas. Reg. § 1.856-3(d) (the “Real Property”)) owned by the Property LLCs shall be at least eighty-five percent (85%) of the value of all of the assets of Borrower; (b) the value of the Real Property owned by the Property LLCs shall equal or exceed the amount due under this Note , (c) TRSCo shall at all times own all of the membership interests in the Property LLCs, which are and will continue to be disregarded as separate from TRSCo for U.S. federal income tax purposes, and (d) TRSCo shall not own any Real Property directly (and shall own all Real Property indirectly through the Property LLCs). For purposes of this paragraph, the value of the Real Property shall be reduced by any liens encumbering the Real Property, other than the liens securing this Note, as well as by the amount of any other liabilities of the Property LLCs, that are, in each case, senior to the Note and any instrument securing this note and creating a security interest against the Real Property. The covenants set forth in clauses (a)-(d) above are intended to cause the Note to be treated as a “real estate asset” under Section 865(c)(5856(c)(5) of the Internal Revenue Code of 1986, as amended, Treas. Reg. § 1.856-5, and IRS Revenue Procedure 2003-65 and shall be interpreted consistently therewith.