THE ADMINISTRATIVE AGENT WITHIN ONE HUNDRED AND TWENTY (120) DAYS FOLLOWING THE
END OF EACH FISCAL YEAR A COMPLETE COPY OF THE ANNUAL FINANCIAL STATEMENTS OF
THE BORROWER AND OF CNL REIT AND ITS SUBSIDIARIES ON A CONSOLIDATED BASIS,
AUDITED BY A "BIG FOUR" ACCOUNTING FIRM OR ANOTHER INDEPENDENT CERTIFIED PUBLIC
ACCOUNTING FIRM ACCEPTABLE TO THE ADMINISTRATIVE AGENT IN ACCORDANCE WITH GAAP
FOR SUCH FISCAL YEAR AND CONTAINING A BALANCE SHEET, A STATEMENT OF OPERATIONS
AND A STATEMENT OF CASH FLOWS.
THE ANNUAL FINANCIAL STATEMENTS OF THE BORROWER
AND OF CNL REIT AND ITS SUBSIDIARIES ON A CONSOLIDATED BASIS SHALL BE
ACCOMPANIED BY AN OFFICER'S CERTIFICATE CERTIFYING THAT EACH SUCH ANNUAL
FINANCIAL STATEMENT PRESENTS FAIRLY, IN ALL MATERIAL RESPECTS, THE FINANCIAL
CONDITION AND RESULTS OF OPERATION OF THE RELEVANT PERSONS AND HAS BEEN PREPARED
IN ACCORDANCE WITH GAAP.
TOGETHER WITH SUCH ANNUAL FINANCIAL STATEMENTS, THE
BORROWER SHALL FURNISH TO THE ADMINISTRATIVE AGENT (A) AN OFFICER'S CERTIFICATE
CERTIFYING AS OF THE DATE THEREOF WHETHER, TO THE BORROWER'S KNOWLEDGE, THERE
EXISTS A DEFAULT OR EVENT OF DEFAULT, AND IF SUCH DEFAULT OR EVENT OF DEFAULT
EXISTS, THE NATURE THEREOF, THE PERIOD OF TIME IT HAS EXISTED AND THE ACTION
THEN BEING TAKEN TO REMEDY THE SAME; AND (B) AN ANNUAL REPORT, FOR THE MOST
RECENTLY COMPLETED FISCAL YEAR, CONTAINING:
(a) Capital Expenditures (including for this purpose any and all additions to,
and replacements of, FF&E,) made in respect of the Mortgaged Property, including
separate line items with respect to any project costing in excess of $500,000
for any Mortgaged Property;
(b) occupancy levels for the Mortgaged Property for such period; and
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(c) average daily room rates at the Mortgaged Property for such period.
(D)
MANAGEMENT AGREEMENT.
THE BORROWER SHALL
DELIVER TO THE ADMINISTRATIVE AGENT, WITHIN TEN (10) BUSINESS DAYS OF THE
RECEIPT THEREOF BY THE BORROWER, A COPY OF ALL MATERIAL OR REQUIRED REPORTS
PREPARED BY ANY MANAGER PURSUANT TO ANY MANAGEMENT AGREEMENT, INCLUDING, WITHOUT
LIMITATION, THE BUDGET PROPOSED BY MANAGER AND ANY INSPECTION REPORTS.
(E)
BUDGET.
Not later than February 15 of each Fiscal Year hereafter, the Borrower shall
prepare or cause to be prepared and deliver to the Administrative Agent, a
proposed aggregate Budget in respect of the Mortgaged Properties for such Fiscal
Year (including a breakdown of proposed individual Budgets for each Mortgaged
Property and a breakdown by fiscal quarter), showing, inter alia, proposed
Capital Expenditures for each Mortgaged Property.
If the Borrower subsequently
proposes to materially amend any such Budget, the Borrower shall promptly
deliver the proposed amended Budget to the Administrative Agent.
(F)
OTHER INFORMATION.
THE BORROWER SHALL,
PROMPTLY AFTER WRITTEN REQUEST BY THE ADMINISTRATIVE AGENT FURNISH OR CAUSE TO
BE FURNISHED TO THE ADMINISTRATIVE AGENT, IN SUCH MANNER AND IN SUCH DETAIL AS
MAY BE REASONABLY REQUESTED BY THE ADMINISTRATIVE AGENT, SUCH REASONABLE
ADDITIONAL INFORMATION AS MAY BE REASONABLY REQUESTED WITH RESPECT TO THE
MORTGAGED PROPERTY. THE INFORMATION REQUIRED TO BE FURNISHED BY THE BORROWER TO
THE ADMINISTRATIVE AGENT UNDER THIS SECTION 7.8(2) SHALL