FREE WRITING PROSPECTUS | ||
FILED PURSUANT TO RULE 433 | ||
REGISTRATION FILE NO.: 333-172366-14 | ||
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THIS FREE WRITING PROSPECTUS, DATED MAY 21, 2014, MAY BE AMENDED OR COMPLETED
PRIOR TO TIME OF SALE.
PRIOR TO TIME OF SALE.
The depositor has filed a registration statement (including a prospectus) with the SEC (SEC File No. 333-172366) for the offering to which this communication relates. Before you invest, you should read the prospectus in that registration statement and other documents the depositor has filed with the SEC for more complete information about the depositor and this offering. You may get these documents for free by visiting EDGAR on the SEC website at www.sec.gov. Alternatively, the depositor or any underwriter or any dealer participating in this offering will arrange to send you the prospectus if you request it by calling 1-800-745-2063 (8 a.m. – 5 p.m. EST) or by emailing wfs.cmbs@wellsfargo.com.
SUPPLEMENT TO FREE WRITING PROSPECTUS AND STRUCTURAL AND
COLLATERAL TERM SHEET, EACH DATED MAY 14, 2014
$846,222,000
(Approximate)
Wells Fargo Commercial Mortgage Trust 2014-LC16
as Issuing Entity
Wells Fargo Commercial Mortgage Securities, Inc.
as Depositor
Ladder Capital Finance LLC
Wells Fargo Bank, National Association
The Royal Bank of Scotland
Rialto Mortgage Finance, LLC
as Sponsors and Mortgage Loan Sellers
Commercial Mortgage Pass-Through Certificates
Series 2014-LC16
May 21, 2014
WELLS FARGO SECURITIES | RBS |
Co-Lead Manager and Co-Bookrunner | Co-Lead Manager and Co-Bookrunner |
Deutsche Bank Securities
Co-Manager
$846,222,000 (Approximate)
Wells Fargo Commercial Mortgage Trust 2014-LC16
Commercial Mortgage Pass-Through Certificates, Series 2014-LC16
IMPORTANT NOTICE REGARDING THE CERTIFICATES
THE CERTIFICATES REFERRED TO IN THESE MATERIALS ARE SUBJECT TO MODIFICATION OR REVISION (INCLUDING THE POSSIBILITY THAT ONE OR MORE CLASSES OF CERTIFICATES MAY BE SPLIT, COMBINED OR ELIMINATED AT ANY TIME PRIOR TO ISSUANCE OR AVAILABILITY OF A FINAL PROSPECTUS SUPPLEMENT) AND ARE OFFERED ON A “WHEN, AS AND IF ISSUED” BASIS. PROSPECTIVE INVESTORS SHOULD UNDERSTAND THAT, WHEN CONSIDERING THE PURCHASE OF THESE SECURITIES, A CONTRACT OF SALE WILL COME INTO BEING NO SOONER THAN THE DATE ON WHICH THE RELEVANT CLASS OF CERTIFICATES HAS BEEN PRICED AND THE UNDERWRITERS HAVE CONFIRMED THE ALLOCATION OF CERTIFICATES TO BE MADE TO INVESTORS; ANY “INDICATIONS OF INTEREST” EXPRESSED BY ANY PROSPECTIVE INVESTOR, AND ANY “SOFT CIRCLES” GENERATED BY THE UNDERWRITERS, WILL NOT CREATE BINDING CONTRACTUAL OBLIGATIONS FOR SUCH PROSPECTIVE INVESTORS, ON THE ONE HAND, OR THE UNDERWRITERS, THE DEPOSITOR OR ANY OF THEIR RESPECTIVE AGENTS OR AFFILIATES, ON THE OTHER HAND.
AS A RESULT OF THE FOREGOING, A PROSPECTIVE INVESTOR MAY COMMIT TO PURCHASE CERTIFICATES THAT HAVE CHARACTERISTICS THAT MAY CHANGE, AND EACH PROSPECTIVE INVESTOR IS ADVISED THAT ALL OR A PORTION OF THE CERTIFICATES REFERRED TO IN THESE MATERIALS MAY BE ISSUED WITHOUT ALL OR CERTAIN OF THE CHARACTERISTICS DESCRIBED IN THESE MATERIALS. THE UNDERWRITERS’ OBLIGATION TO SELL CERTIFICATES TO ANY PROSPECTIVE INVESTOR IS CONDITIONED ON THE CERTIFICATES AND THE TRANSACTION HAVING THE CHARACTERISTICS DESCRIBED IN THESE MATERIALS. IF THE UNDERWRITERS DETERMINE THAT A CONDITION IS NOT SATISFIED IN ANY MATERIAL RESPECT, SUCH PROSPECTIVE INVESTOR WILL BE NOTIFIED, AND NEITHER THE DEPOSITOR NOR THE UNDERWRITERS WILL HAVE ANY OBLIGATION TO SUCH PROSPECTIVE INVESTOR TO DELIVER ANY PORTION OF THE CERTIFICATES WHICH SUCH PROSPECTIVE INVESTOR HAS COMMITTED TO PURCHASE, AND THERE WILL BE NO LIABILITY BETWEEN THE UNDERWRITERS, THE DEPOSITOR OR ANY OF THEIR RESPECTIVE AGENTS OR AFFILIATES, ON THE ONE HAND, AND SUCH PROSPECTIVE INVESTOR, ON THE OTHER HAND, AS A CONSEQUENCE OF THE NON-DELIVERY.
EACH PROSPECTIVE INVESTOR HAS REQUESTED THAT THE UNDERWRITERS PROVIDE TO SUCH PROSPECTIVE INVESTOR INFORMATION IN CONNECTION WITH SUCH PROSPECTIVE INVESTOR’S CONSIDERATION OF THE PURCHASE OF THE CERTIFICATES DESCRIBED IN THESE MATERIALS. THESE MATERIALS ARE BEING PROVIDED TO EACH PROSPECTIVE INVESTOR FOR INFORMATIVE PURPOSES ONLY IN RESPONSE TO SUCH PROSPECTIVE INVESTOR’S SPECIFIC REQUEST. THE UNDERWRITERS DESCRIBED IN THESE MATERIALS MAY FROM TIME TO TIME PERFORM INVESTMENT BANKING SERVICES FOR, OR SOLICIT INVESTMENT BANKING BUSINESS FROM, ANY COMPANY NAMED IN THESE MATERIALS. THE UNDERWRITERS AND/OR THEIR AFFILIATES OR RESPECTIVE EMPLOYEES MAY FROM TIME TO TIME HAVE A LONG OR SHORT POSITION IN ANY SECURITY OR CONTRACT DISCUSSED IN THESE MATERIALS.
THE INFORMATION CONTAINED HEREIN SUPERSEDES ANY PREVIOUS SUCH INFORMATION DELIVERED TO ANY PROSPECTIVE INVESTOR AND WILL BE SUPERSEDED BY INFORMATION DELIVERED TO SUCH PROSPECTIVE INVESTOR PRIOR TO THE TIME OF SALE.
Wells Fargo Securities is the trade name for the capital markets and investment banking services of Wells Fargo & Company and its subsidiaries, including but not limited to WFS, a member of NYSE, FINRA, NFA and SIPC, Wells Fargo Institutional Securities, LLC a member of FINRA and SIPC, and Wells Fargo Bank, National Association. Wells Fargo Securities carries and provides clearing services for Wells Fargo Institutional Securities, LLC customer accounts.
RBS is a trade name for the investment banking business of RBSSI. Securities, syndicated loan arranging, financial advisory and other investment banking activities are performed by RBSSI and their securities affiliates. Lending, derivatives and other commercial banking activities are performed by The Royal Bank of Scotland plc and their banking affiliates. RBSSI is a member of SIPC, FINRA and the NYSE.
THE INFORMATION IN THIS SUPPLEMENT IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS SUPPLEMENT IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
i
$846,222,000 (Approximate)
Wells Fargo Commercial Mortgage Trust 2014-LC16
Commercial Mortgage Pass-Through Certificates, Series 2014-LC16
IMPORTANT NOTICE RELATING TO AUTOMATICALLY-GENERATED EMAIL DISCLAIMERS
Any legends, disclaimers or other notices that may appear at the bottom of any email communication to which this Supplement is attached relating to (1) these materials not constituting an offer (or a solicitation of an offer), (2) no representation that these materials are accurate or complete and may not be updated or (3) these materials possibly being confidential, are not applicable to these materials and should be disregarded. Such legends, disclaimers or other notices have been automatically generated as a result of these materials having been sent via Bloomberg or another system.
THE INFORMATION IN THIS SUPPLEMENT IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS SUPPLEMENT IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
ii
$846,222,000 (Approximate)
Wells Fargo Commercial Mortgage Trust 2014-LC16
Commercial Mortgage Pass-Through Certificates, Series 2014-LC16
The Free Writing Prospectus dated May 14, 2014, as supplemented by that certain supplement dated May 20, 2014 (collectively, the “Free Writing Prospectus”) and the Structural and Collateral Term Sheet dated May 14, 2014, as supplemented by that certain supplement dated May 20, 2014 (collectively, the “Term Sheet”) are hereby updated as set forth below. The information in this supplement dated May 21, 2014 (the “Supplement”) supersedes any contradictory information in the Free Writing Prospectus and the Term Sheet. Defined terms used in this Supplement but not defined herein have the meanings given to them in the Free Writing Prospectus. In all other respects, except as modified below, the Free Writing Prospectus and Term Sheet remain unmodified.
Collateral Update
1. Harlequin Plaza.
The following bullet point is hereby added to page 181 of the Free Writing Prospectus following the second full bullet point appearing on such page:
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A-1 to this free writing prospectus as Harlequin Plaza, representing approximately 2.9% of the Cut-Off Date Pool Balance, an affiliate of the related sponsor has been party to a mortgage loan workout resulting from a mortgage loan default. The affiliate and a joint venture partner acquired a Portland, Oregon office building in 2008 and subsequently defaulted on their mortgage financing in 2010 as economic conditions worsened. As part of workout negotiations, the lender agreed to write-down the principal amount of the loan by $10 million in exchange for a contingent interest in the related property. Upon a sale of the related property in 2013, the lender received approximately $7 million for its contingent interest. |
Structural Update
2. Class A-4 and Class A-5 Certificates.
The initial principal balance of the Class A-4 certificates will be increased to $200,000,000 and the initial principal balance of the Class A-5 certificates will be decreased to $231,235,000.
3. Revised Issue Characteristics.
Class | Expected Ratings (DBRS/KBRA/Moody’s) | Approx. Initial Principal Balance or Notional Amount(1) | Approx. % of Aggregate Cut-off Date Balance | Approx. Initial Credit Support(2) | Approx. Initial Pass- Through Rate | Pass- Through Rate Description | Weighted Average Life (Years)(3) | Expected Principal Window | |
Offered Certificates | |||||||||
A-4 | AAA(sf)/AAA(sf)/Aaa(sf) | $200,000,000 | 20.532% | 30.000% | % | (4) | 9.84 | 03/24 – 04/24 | |
A-5 | AAA(sf)/AAA(sf)/Aaa(sf) | $231,235,000 | 23.739% | 30.000% | % | (4) | 9.91 | 04/24 – 05/24 |
Notes: | (1) | The initial principal balances set forth in the table are approximate. The actual initial principal balances may be larger or smaller depending on the aggregate cut-off date principal balance of the mortgage loans definitively included in the pool of mortgage loans, which aggregate cut-off date principal balance may be as much as 5% larger or smaller than the amount presented in the Free Writing Prospectus. |
(2) | The approximate initial credit support with respect to the Class A-4 and A-5 certificates represents the approximate credit enhancement for the Class A-1, A-2, A-3, A-4, A-5 and A-SB certificates in the aggregate. | |
(3) | Calculated based on a 0% CPR and the structuring assumptions described in Annex B to the Free Writing Prospectus. | |
(4) | The pass-through rates for the Class A-4 and A-5 certificates, in each case, will be one of the following: (i) a fixed rate per annum, (ii) the weighted average of the net mortgage interest rates on the mortgage loans for the related distribution date, (iii) a variable rate per annum equal to the lesser of (a) a fixed rate and (b) the weighted average of the net mortgage interest rates on the mortgage loans for the related distribution date or (iv) a variable rate per annum equal to the weighted average of the net mortgage interest rates on the mortgage loans for the related distribution date minus a specified percentage. For purposes of the calculation of the weighted average of the net mortgage interest rates on the mortgage loans for each distribution date, the mortgage interest rates will be adjusted as necessary to a 30/360 basis. |
THE INFORMATION IN THIS SUPPLEMENT IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS SUPPLEMENT IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
A-1
$846,222,000 (Approximate)
Wells Fargo Commercial Mortgage Trust 2014-LC16
Commercial Mortgage Pass-Through Certificates, Series 2014-LC16
4. Weighted Average Lives; Decrement Tables.
The tables that appear in the Free Writing Prospectus under the heading “Yield and Maturity Considerations—Weighted Average Life” and are entitled “Percentages of Initial Certificate Principal Balance Outstanding for the Class A-4 Certificates at the Specified Percentages of CPR” and “Percentages of Initial Certificate Principal Balance Outstanding for the Class A-5 Certificates at the Specified Percentages of CPR” are hereby deleted in their entirety and replaced with the following tables:
Percentages of Initial Certificate Principal Balance Outstanding for the Class A-4
Certificates at the Specified Percentages of CPR
0% CPR During Lockout, Defeasance or Yield Maintenance and Prepayment Premium
– otherwise at indicated CPR
Distribution Date in | 0% CPR | 25% CPR | 50% CPR | 75% CPR | 100% CPR |
Closing Date | 100% | 100% | 100% | 100% | 100% |
June 2015 | 100% | 100% | 100% | 100% | 100% |
June 2016 | 100% | 100% | 100% | 100% | 100% |
June 2017 | 100% | 100% | 100% | 100% | 100% |
June 2018 | 100% | 100% | 100% | 100% | 100% |
June 2019 | 100% | 100% | 100% | 100% | 100% |
June 2020 | 100% | 100% | 100% | 100% | 100% |
June 2021 | 100% | 100% | 100% | 100% | 100% |
June 2022 | 100% | 100% | 100% | 100% | 100% |
June 2023 | 100% | 100% | 99% | 99% | 96% |
June 2024 and thereafter | 0% | 0% | 0% | 0% | 0% |
Weighted average life (years) | 9.84 | 9.80 | 9.75 | 9.68 | 9.49 |
Percentages of Initial Certificate Principal Balance Outstanding for the Class A-5
Certificates at the Specified Percentages of CPR
0% CPR During Lockout, Defeasance or Yield Maintenance and Prepayment Premium
– otherwise at indicated CPR
Distribution Date in | 0% CPR | 25% CPR | 50% CPR | 75% CPR | 100% CPR |
Closing Date | 100% | 100% | 100% | 100% | 100% |
June 2015 | 100% | 100% | 100% | 100% | 100% |
June 2016 | 100% | 100% | 100% | 100% | 100% |
June 2017 | 100% | 100% | 100% | 100% | 100% |
June 2018 | 100% | 100% | 100% | 100% | 100% |
June 2019 | 100% | 100% | 100% | 100% | 100% |
June 2020 | 100% | 100% | 100% | 100% | 100% |
June 2021 | 100% | 100% | 100% | 100% | 100% |
June 2022 | 100% | 100% | 100% | 100% | 100% |
June 2023 | 100% | 100% | 100% | 100% | 100% |
June 2024 and thereafter | 0% | 0% | 0% | 0% | 0% |
Weighted average life (years) | 9.91 | 9.90 | 9.89 | 9.86 | 9.64 |
THE INFORMATION IN THIS SUPPLEMENT IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS SUPPLEMENT IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
2