AGREEMENT ARE SOLELY FOR CONVENIENCE OF REFERENCE AND SHALL NOT CONSTITUTE PART
OF THIS AGREEMENT OR AFFECT ITS MEANING, CONSTRUCTION OR EFFECT.
2.
DEPOSITS TO STABILIZATION ESCROW.
2.1
DEPOSITS AND PERMITTED INVESTMENTS.
(A)
UPON EXECUTION OF THIS AGREEMENT, GUARANTOR SHALL DEPOSIT WITH
FREDDIE MAC THE SUM OF $76,000,000.00 (THE "INITIAL DEPOSIT").
(B)
THEREAFTER, GUARANTOR SHALL DEPOSIT OR CAUSE TO BE DEPOSITED WITH
FREDDIE MAC THE FOLLOWING ADDITIONAL DEPOSITS (COLLECTIVELY, THE "STABILIZATION
ESCROW REQUIRED ADDITIONAL DEPOSITS") BUT ONLY UP TO THE AMOUNT THAT THE DEPOSIT
(HEREINAFTER DEFINED) EQUALS THE REQUIRED ESCROW AMOUNT (HEREINAFTER DEFINED):
(I)
WITHIN THREE (3) BUSINESS DAYS AFTER AN INCREASE OF THE PRINCIPAL
AMOUNT OF THE BANK CREDIT FACILITY TO AN AMOUNT IN EXCESS OF $350,000,000, THE
AMOUNT OF SUCH EXCESS.
(II)
COMMENCING ON JULY 1, 2008 AND CONTINUING ON THE FIRST DAY OF
EACH MONTH THEREAFTER, AN AMOUNT EQUAL TO ONE-TWELFTH (1/12TH) OF THE AMOUNT OF
THE ESCROW SHORTFALL (THE "MONTHLY DEPOSIT") DETERMINED AS OF JUNE 30, 2008;
PROVIDED, HOWEVER; THAT ONLY ONE-HALF OF EACH MONTHLY DEPOSIT IS REQUIRED TO BE
PAID ON THE FIRST DAY OF EACH MONTH (THE "CASH PORTION") AND THE REMAINING
ONE-HALF SHALL BE DEFERRED AND PAID ON THE LAST DAY OF THE CALENDAR QUARTER (THE
"DEFERRED PORTION") FOLLOWING RECALCULATION OF THE REQUIRED ESCROW AMOUNT.
THE
DEFERRED PORTION PAYABLE ON THE LAST DAY OF EACH CALENDAR QUARTER SHALL BE
REDUCED, IF APPLICABLE, BY THE REDUCTION IN THE REQUIRED ESCROW AMOUNT DUE TO
NON-STABILIZED
2
MORTGAGED PROPERTIES HAVING BEEN RE-CLASSIFIED DURING SUCH QUARTER BASED ON
"COMPLETION" OR "STABILIZATION" PURSUANT TO SECTIONS 3.2(A) AND (B), AND IF SUCH
REDUCTION EXCEEDS THE DEFERRED PORTION, THE AMOUNT OF SUCH EXCESS SHALL BE
CREDITED AGAINST THE ENSUING MONTHLY DEPOSITS (I.E., MONTHLY CASH PORTIONS AND
QUARTERLY DEFERRED PORTIONS) UNTIL SUCH EXCESS IS FULLY CREDITED.
AS USED
HEREIN, THE TERM "ESCROW SHORTFALL" SHALL MEAN, AS OF THE DATE OF DETERMINATION,
THE AMOUNT EQUAL TO THE DIFFERENCE BETWEEN (I) THE REQUIRED ESCROW AMOUNT ON
SUCH DATE AND (II) THE DEPOSIT.
FOR PURPOSES OF DETERMINING WHETHER ANY
STABILIZATION ESCROW REQUIRED ADDITIONAL DEPOSITS ARE REQUIRED, ANY WITHDRAWALS
FROM THE STABILIZATION ESCROW TO PAY SPONSOR'S STABILIZATION OBLIGATIONS SHALL
NOT BE TAKEN INTO ACCOUNT.
(C)
FROM AND AFTER THE DATE ON WHICH THE DEPOSIT EQUALS OR EXCEEDS THE
REQUIRED ESCROW AMOUNT, THE OBLIGATION TO MAKE STABILIZATION ESCROW REQUIRED
ADDITIONAL DEPOSITS AND TO PAY THE SHORTFALL FEE (HEREINAFTER DEFINED) SHALL
TERMINATE AND SHALL THEREAFTER BE OF NO FURTHER FORCE OR EFFECT FOR THE
REMAINING TERM OF THIS AGREEMENT.
(D)
THE GUARANTOR MAY, BUT SHALL NOT BE REQUIRED TO, MAKE OR CAUSE TO
BE MADE ADDITIONAL CASH DEPOSITS FROM TIME TO TIME (COLLECTIVELY THE "VOLUNTARY
ADDITIONAL DEPOSITS").
The Initial Deposit, the Stabilization Escrow Required Additional Deposits and,
to the extent actually paid to Freddie Mac, the Voluntary Additional Deposits
are hereinafter collectively referred to as the "Deposit."
Freddie Mac shall
hold the Deposit in a segregated account (the "Stabilization Escrow") until used
or released as provided herein, and invest the Deposit in any of the Permitted