INTEREST OR PRINCIPAL
SHALL BE RETAINED IN THE DEFEASANCE COLLATERAL ACCOUNT AS ADDITIONAL COLLATERAL
FOR THE LOAN. BORROWER SHALL CAUSE THE ELIGIBLE INSTITUTION AT WHICH THE
DEFEASANCE COLLATERAL IS DEPOSITED TO ENTER AN AGREEMENT WITH BORROWER AND
LENDER, SATISFACTORY TO LENDER IN ITS SOLE DISCRETION, PURSUANT TO WHICH SUCH
ELIGIBLE INSTITUTION SHALL AGREE TO HOLD AND DISTRIBUTE THE DEFEASANCE
COLLATERAL IN ACCORDANCE WITH THIS AGREEMENT. THE SUCCESSOR BORROWER SHALL BE
THE OWNER OF THE DEFEASANCE COLLATERAL ACCOUNT AND SHALL REPORT ALL INCOME
ACCRUED ON DEFEASANCE COLLATERAL FOR FEDERAL, STATE AND LOCAL INCOME TAX
PURPOSES IN ITS INCOME TAX RETURN. BORROWER SHALL PREPAY ALL COST AND EXPENSES
ASSOCIATED WITH OPENING AND MAINTAINING THE DEFEASANCE COLLATERAL ACCOUNT.
LENDER SHALL NOT IN ANY WAY BE LIABLE BY REASON OF ANY INSUFFICIENCY IN THE
DEFEASANCE COLLATERAL ACCOUNT.
(C)
SUCCESSOR BORROWER. IN CONNECTION WITH A DEFEASANCE EVENT UNDER
THIS SECTION 2.3.3, BORROWER SHALL, IF REQUIRED BY THE RATING AGENCIES OR IF
BORROWER ELECTS TO DO SO, ESTABLISH OR DESIGNATE A SUCCESSOR ENTITY (THE
"SUCCESSOR BORROWER") WHICH SHALL BE A SINGLE PURPOSE BANKRUPTCY REMOTE ENTITY
AND WHICH SHALL BE APPROVED BY THE RATING AGENCIES. ANY SUCH SUCCESSOR BORROWER
MAY, AT BORROWER'S OPTION, BE AN AFFILIATE OF BORROWER UNLESS THE RATING
AGENCIES SHALL REQUIRE OTHERWISE. BORROWER SHALL TRANSFER AND ASSIGN ALL
OBLIGATIONS, RIGHTS AND DUTIES UNDER AND TO THE DEFEASED NOTE, TOGETHER WITH THE
DEFEASANCE COLLATERAL TO SUCH SUCCESSOR BORROWER. SUCH SUCCESSOR BORROWER SHALL
ASSUME THE OBLIGATIONS UNDER THE NOTE AND THE SECURITY AGREEMENT AND BORROWER
SHALL BE RELIEVED OF ITS OBLIGATIONS UNDER SUCH DOCUMENTS. BORROWER SHALL PAY A
MINIMUM OF $1,000 TO ANY SUCH SUCCESSOR BORROWER AS CONSIDERATION FOR ASSUMING
THE OBLIGATIONS UNDER THE NOTE AND THE SECURITY AGREEMENT. BORROWER SHALL PAY
ALL COSTS AND EXPENSES INCURRED BY LENDER, INCLUDING LENDER'S ATTORNEY'S FEES
AND EXPENSES, INCURRED IN CONNECTION THEREWITH.
2.3.4
OPTIONAL PREPAYMENTS. ON AND AFTER THE THIRD PAYMENT DATE PRIOR TO
THE STATED MATURITY DATE (THE "PERMITTED PREPAYMENT DATE"), BORROWER SHALL HAVE
THE RIGHT TO PREPAY THE LOAN IN WHOLE (BUT NOT IN PART), PROVIDED THAT BORROWER
GIVES LENDER AT LEAST FIFTEEN
18
(15) DAYS' PRIOR WRITTEN NOTICE THEREOF. IF ANY SUCH PREPAYMENT IS NOT MADE ON A
PAYMENT DATE, BORROWER SHALL ALSO PAY INTEREST THAT WOULD HAVE ACCRUED ON SUCH
PREPAID PRINCIPAL TO, BUT NOT INCLUDING, THE NEXT PAYMENT DATE. ANY SUCH
PREPAYMENT SHALL BE MADE WITHOUT PAYMENT OF THE YIELD MAINTENANCE PREMIUM.
2.4
RELEASE OF PROPERTY.
2.4.1
RELEASE ON DEFEASANCE. IF BORROWER HAS ELECTED TO DEFEASE THE NOTE
AND THE REQUIREMENTS OF SECTION 2.3.3 ABOVE AND THIS SECTION 2.4 HAVE BEEN
SATISFIED, THE PROPERTY SHALL BE RELEASED FROM THE LIEN OF THE SECURITY
INSTRUMENT AND THE DEFEASANCE COLLATERAL PLEDGED PURSUANT TO THE SECURITY
AGREEMENT SHALL BE THE SOLE SOURCE OF COLLATERAL SECURING THE NOTE. IN
CONNECTION WITH THE RELEASE OF THE LIEN, BORROWER SHALL SUBMIT TO LENDER, NOT
LESS THAN THIRTY (30) DAYS PRIOR TO THE DEFEASANCE DATE (OR SUCH SHORTER TIME AS
IS ACCEPTABLE TO LENDER IN ITS SOLE DISCRETION), A RELEASE