RESERVE SHALL INITIALLY BE
DISBURSED TO THE PARTIES IN AN AMOUNT EQUAL TO THE PROPORTIONATE SHARE REQUIRED
TO BE FUNDED BY SUCH PARTIES PURSUANT TO THIS SECTION 7.1.3.
25
7.1.4
INTEREST RATE.
EACH TI/CAP EX LOAN WILL BEAR INTEREST IN ARREARS
AT THE TI/CAP EX LOAN RATE, UNLESS THE DEFAULT RATE IS APPLICABLE.
7.1.5
PAYMENTS.
INTEREST AND PRINCIPAL SHALL BE PAYABLE ONLY OUT OF
OPERATING CASH FLOW OR CAPITAL PROCEEDS AS SET FORTH IN ARTICLE 8 HEREOF.
7.1.6
MATURITY.
AT THE TI/CAP EX LOAN MATURITY DATE FOR ANY GIVEN TI/CAP
EX LOAN, ALL ACCRUED INTEREST, PRINCIPAL AND OTHER CHARGES DUE WITH RESPECT TO
SUCH TI/CAP EX LOAN SHALL BE DUE AND PAYABLE IN FULL AND THE PRINCIPAL BALANCE
AND SUCH OTHER CHARGES, BUT NOT UNPAID INTEREST, SHALL BEAR INTEREST AT THE
DEFAULT RATE UNTIL SO PAID.
7.1.7
PREPAYMENT.
A TI/CAP EX LOAN SHALL BE PREPAYABLE IN WHOLE OR IN
PART TO THE EXTENT PERMITTED OR REQUIRED BY THE PROVISIONS OF ARTICLE 8 HEREOF.
7.1.8
COLLATERAL.
TI/CAP EX LOANS SHALL BE UNSECURED OBLIGATIONS OF THE
APPLICABLE PROPERTY OWNER.
7.1.9
TI/CAP EX NOTE.
EACH TI/CAP EX LOAN SHALL BE EVIDENCED BY A TI/CAP
EX LOAN NOTE FROM THE APPLICABLE PROPERTY OWNER TO THE LENDERS THEREOF.
7.2
REPOSITION LOANS.
7.2.1
REPOSITION LOAN REQUEST.
AT SUCH TIME AS A PROPERTY OWNER DESIRES
TO OBTAIN FUNDS TO "REPOSITION" OR "UPGRADE" A PROPERTY (THE "REPOSITION
PROPERTY") IN WHICH FIRST UNION HOLDS AN INDIRECT INTEREST IN OR HAS MADE A
PROPERTY LOAN WITH RESPECT TO THE PROPERTY, SUCH PROPERTY OWNER SHALL GIVE
NOTICE THEREOF TO FIRST UNION (THE "REPOSITION NOTICE") WHICH NOTICE SHALL
IDENTIFY THE PROPERTY, SET FORTH THE AMOUNT OF FUNDS REQUIRED TO REPOSITION THE
PROPERTY (THE "REPOSITION AMOUNT"), PROVIDE A BUDGET WITH RESPECT TO THE
REPOSITION AMOUNT AND SET FORTH A FINANCIAL PROJECTION OF THE FUTURE IMPACT OF
SUCH REPOSITIONING ON THE OPERATIONS AND VALUE OF THE PROPERTY.
WITHIN FIVE
BUSINESS DAYS OF EACH REQUEST BY THE PROPERTY OWNER BUT IN NO EVENT EARLIER THAN
30 DAYS FOLLOWING THE DELIVERY OF THE REPOSITION NOTICE, THE MARC PRINCIPALS,
COLLECTIVELY, AND FIRST UNION SHALL BE OBLIGATED TO, OR SHALL CAUSE THEIR
RESPECTIVE AFFILIATE TO, MAKE LOANS (THE "REPOSITION LOANS") IN AN AMOUNT EQUAL
TO THE PRODUCT OF (I) THE REPOSITION AMOUNT OR PORTION THEREOF THEN BEING
REQUESTED AND (II) EITHER (X) THE DIRECT OR INDIRECT OWNERSHIP INTEREST OF THE
MARC ENTITY OR FIRST UNION, AS APPLICABLE, IN THE PROPERTY OWNER OF SUCH
REPOSITION LOAN OR (Y) IN THE CASE OF A REPOSITION LOAN MADE TO A PROPERTY OWNER
FOR WHICH A PROPERTY LOAN IS THEN OUTSTANDING, 60%, IN THE CASE OF FIRST UNION,
AND 40%, IN THE CASE OF THE MARC PRINCIPALS, ALL ON THE CONDITIONS SET FORTH
HEREIN.
7.2.2
CONDITION TO REPOSITION LOAN.
THE OBLIGATION OF FIRST UNION AND
THE MARC PRINCIPALS TO MAKE, OR CAUSE THEIR RESPECTIVE AFFILIATES TO MAKE, A
REPOSITION LOAN SHALL BE CONDITIONED UPON THE APPROVAL OF SUCH BORROWING BY THE
PROPERTY OWNER, BY ALL OF THE MEMBERS OF THE JOINT