SHARED APPRECIATION / Sample Clauses
A Shared Appreciation clause defines how any increase in the value of an asset, typically real estate, is divided between parties, such as a lender and a borrower, upon the asset's sale or refinancing. In practice, this means that if the property appreciates in value, a predetermined percentage of the gain is paid to the lender in addition to the repayment of the original loan. This arrangement allows lenders to share in the upside of property value increases, while borrowers may benefit from lower initial interest rates or more flexible loan terms. The core function of this clause is to align the interests of both parties and provide a mechanism for sharing the financial benefits of asset appreciation.
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SHARED APPRECIATION /. 1 If ▇▇▇▇▇▇▇▇ has executed a Shared Appreciation Allonge, the covenants of the Allonge shall be incorporated into and supplement the covenants of this Note as if the Allonge were a part of this Note.
SHARED APPRECIATION /. Each loan made by either Agency pursuant to its City HOME Agreement may include a shared appreciation provision in a form approved by the County. If either City HOME Agreement includes a shared appreciation provision, the City shall cause the Agency to place shared appreciation, together with the repaid loan proceeds, in the Agency account (the HOME account referenced in Section IV-F-3) that will be used by the Agency for additional purchase assistance loans.
SHARED APPRECIATION /. Each loan made by the Agency with funds provided pursuant to this Agreement may include a shared appreciation provision in the form contained in Exhibit E (Subordinate Deed of Trust Note). The Agency shall place shared appreciation, together with the repaid loan proceeds, in the Agency account (the HOME account referenced in Section IV-F-3 above) that will be used by the Agency for additional purchase assistance loans.
SHARED APPRECIATION /. If the use of the Property changes to something other than that stated in Attachment B – Scope of Work of this Contract prior to completion of the Commitment Period or the end of this Contract, either by the CONTRACTOR, its successors or assigns, or as a result of a sale, transfer or refinance of the Property, the DEPARTMENT shall share in the appreciated value of the Property as described below. The DEPARTMENT reserves the right in some circumstances to waive its Shared Appreciation, partially or in its entirety, where the funds generated by a sale, transfer or refinance of the Property are to be reinvested in affordable housing for Low-income Households to serve the same population targeted in this Contract, pursuant to a plan agreed to in writing by the CONTRACTOR and the DEPARTMENT prior to such sale, transfer or refinance. The DEPARTMENT’s Shared Appreciation shall be due and payable, by the then current owner of the Property, if any or all of the following occurs:
A. Sale, transfer or refinance of the Property, or a portion of the Property, for a use other than that stated in Attachment B – Scope of Work of this Contract.
B. Change in use.
C. Contract termination for cause.
D. Material non-compliance with the terms and obligations of this Contract. For purposes of Shared Appreciation, “Original Principal” shall mean the Contract Amount awarded under this Contract. Shared Appreciation is the DEPARTMENT’s proportionate share of the appreciated value of the Property, together with the appreciated value of the improvements constructed thereon regardless of whether such improvements are developed by the CONTRACTOR, its assigns, or by any lessee of the Property. Shared Appreciation (SA) is the product of the Net Proceeds (NP) less Total Original Development Costs (TODC) multiplied by the fraction whose numerator is the Original Principal (OP) amount and whose denominator is the TODC: SA = (NP-TODC) x (OP/TODC).
SHARED APPRECIATION /. (i) In general