EVENT
THE CLOSING FUNDING IS MADE BUT
THEREAFTER THE LENDER DEFAULTS IN
ITS OBLIGATION TO ADVANCE PROCEEDS OF THE LOAN PROVIDED ALL APPLICABLE
CONDITIONS TO ITS OBLIGATION TO FUND SUCH PROCEEDS HAVE BEEN SATISFIED, OR
THE
LENDER IS OTHERWISE IN DEFAULT OF ANY OF ITS OTHER MATERIAL OBLIGATIONS
WITH REGARD TO THE LOAN, AND IN ANY SUCH CASE SUCH FUNDING OR OTHER MATERIAL
DEFAULT REMAINS UNCURED FOR A PERIOD OF (i) FIVE (5) BUSINESS DAYS FOR A FUNDING
DEFAULT OR (ii) THIRTY (30) DAYS FOR ANY OTHER MATERIAL DEFAULT, IN EACH CASE
FOLLOWING LENDER'S RECEIPT FROM BORROWER OF WRITTEN NOTICE OF THE DEFAULT IN
QUESTION,
THEN:
(i)
IF, PRIOR TO THE DATE THE DEFAULT BY LENDER IS
CURED,
LITIGATION IS FILED BY ONE OR MORE OF THE PARTIES IN A COURT OF
COMPETENT JURISDICTION WITH REGARD TO THE ALLEGED DEFAULT BY LENDER AS DESCRIBED
ABOVE, BORROWER MAY, AT ITS OPTION REQUIRE THAT LENDER, CONCURRENTLY WITH THE
DELIVERY OF THE PAYMENTS DESCRIBED IN (a) AND (b) BELOW, AND PRIOR TO A
DETERMINATION BY SUCH COURT OF
83
WHETHER LENDER IS IN DEFAULT (BUT SUBJECT TO THE REQUIREMENTS BELOW), ASSIGN
(WITHOUT RECOURSE, REPRESENTATION OR WARRANTY) THE LOAN DOCUMENTS (INCLUDING THE
DEED OF TRUST LIEN WITH ITS EXISTING FIRST LIEN POSITION) TO A REPLACEMENT
LENDER FOR THE PROJECT (WHICH MAY BE AN AFFILIATE OF BORROWER) AND ENDORSE THE
NOTE, WITHOUT RECOURSE, REPRESENTATION OR WARRANTY, TO THE REPLACEMENT LENDER
AND RELEASE ALL OTHER COLLATERAL FOR THE LOAN.
IN THAT CASE, THE LOAN WILL BE
ASSIGNED TO THE REPLACEMENT LENDER IN ACCORDANCE WITH A CUSTOMARY ASSIGNMENT AND
ASSUMPTION AGREEMENT IN CONFORMITY WITH THE FOREGOING
PROVISIONS.
CONTEMPORANEOUSLY WITH, AND AS A CONDITION TO SUCH TRANSFER OF THE
LOAN AND RELEASE OF COLLATERAL, BORROWER MUST (a) PAY OR CAUSE TO BE PAID TO
LENDER THE OUTSTANDING PRINCIPAL BALANCE OF THE LOAN AND ALL ACCRUED, UNPAID
INTEREST THEREON AND OTHER AMOUNTS OWED TO LENDER WITH REGARD TO THE LOAN,
INCLUDING OUTSTANDING REIMBURSABLE EXPENSES BUT WITHOUT PAYMENT OF ANY
PREPAYMENT PREMIUM OR YIELD MAINTENANCE, AND (b) PAY OR CAUSE TO BE PAID INTO
THE REGISTRY OF SUCH COURT ALL REQUIRED YIELD MAINTENANCE AND PREPAYMENT FEES
(CALCULATED IN ACCORDANCE WITH THE LOAN DOCUMENTS) TO BE HELD BY SUCH COURT
PENDING FINAL DETERMINATION OF THE DISPUTE BETWEEN THE PARTIES, WITH SUCH YIELD
MAINTENANCE AND PREPAYMENT FEES TO BE RELEASED AND PAID (1) TO BORROWER IF SUCH
COURT DETERMINES LENDER WAS IN DEFAULT OF ITS OBLIGATIONS UNDER THE LOAN
DOCUMENTS AS ALLEGED BY BORROWER AND (2) TO LENDER IF SUCH COURT DOES NOT
DETERMINE LENDER WAS IN DEFAULT AS ALLEGED BY BORROWER AND
(ii)
IF SUCH COURT DETERMINES LENDER WAS IN DEFAULT AS
ALLEGED BY BORROWER, BORROWER AND ANY GUARANTOR WILL BE ENTITLED TO RECOVERY OF
ACTUAL DAMAGES (BUT NO PUNITIVE, SPECIAL OR OTHER DAMAGES) INCURRED AGAINST
LENDER DUE TO LENDER'S DEFAULT AND AWARDED BY THE COURT IN A FINAL JUDGMENT
WHICH IS UNAPPEALED AND UNAPPEALABLE; PROVIDED, HOWEVER, THAT THE AGGREGATE
AMOUNT OF ALL SUCH ACTUAL DAMAGES INCLUDING ATTORNEYS FEES AND