EVIDENCE OF SUCH PAYMENT
PURSUANT TO SECTION 5.1.2 HEREOF, AND (III) WITH RESPECT TO TAXES, BORROWER
CAUSES BEHRINGER HARVARD REIT I, INC. TO DELIVER A GUARANTY IN FORM AND
SUBSTANCE ACCEPTABLE TO LENDER WITH RESPECT TO THE TIMELY PAYMENT OF TAXES OR
BORROWER HAS DEPOSITED WITH LENDER AN AMOUNT EQUAL TO ONE-HALF OF THE ANNUAL
TAXES.
SECTION 7.3
REPLACEMENTS AND REPLACEMENT
RESERVE.
7.3.1
REPLACEMENT RESERVE FUND.
BORROWER SHALL PAY TO
LENDER ON EACH PAYMENT DATE THE SUM OF $8,661.75 (THE "REPLACEMENT RESERVE
MONTHLY DEPOSIT") FOR REPLACEMENTS AND REPAIRS REQUIRED TO BE MADE TO THE
PROPERTY DURING THE CALENDAR YEAR (COLLECTIVELY, THE "REPLACEMENTS").
AMOUNTS
SO DEPOSITED SHALL HEREINAFTER BE REFERRED TO AS BORROWER'S "REPLACEMENT RESERVE
FUND" AND THE ACCOUNT IN WHICH SUCH AMOUNTS ARE HELD SHALL HEREINAFTER BE
REFERRED TO AS BORROWER'S "REPLACEMENT RESERVE ACCOUNT".
LENDER MAY REASSESS
ITS ESTIMATE OF THE AMOUNT NECESSARY FOR THE REPLACEMENT RESERVE FUND FROM TIME
TO TIME, AND MAY INCREASE THE MONTHLY AMOUNTS REQUIRED TO BE DEPOSITED INTO THE
REPLACEMENT RESERVE FUND UPON THIRTY (30) DAYS NOTICE TO BORROWER IF LENDER
DETERMINES IN ITS COMMERCIALLY REASONABLE DISCRETION BASED UPON UPDATED
ENGINEERING REPORTS OR INSPECTIONS OF THE PROPERTY THAT AN INCREASE IS NECESSARY
TO MAINTAIN THE PROPER MAINTENANCE AND OPERATION OF THE PROPERTY.
NOTWITHSTANDING THE FOREGOING, BORROWER'S OBLIGATION TO MAKE MONTHLY DEPOSITS TO
THE REPLACEMENT RESERVE FUND SHALL BE SUSPENDED PROVIDED THAT NO EVENT OF
DEFAULT OCCURS.
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7.3.2
DISBURSEMENTS FROM REPLACEMENT RESERVE ACCOUNT.
(A)
LENDER SHALL MAKE DISBURSEMENTS FROM THE
REPLACEMENT RESERVE ACCOUNT TO PAY BORROWER ONLY FOR THE COSTS OF THE
REPLACEMENTS.
LENDER SHALL NOT BE OBLIGATED TO MAKE DISBURSEMENTS FROM THE
REPLACEMENT RESERVE ACCOUNT TO REIMBURSE BORROWER FOR THE COSTS OF ROUTINE
MAINTENANCE TO THE PROPERTY, REPLACEMENTS OF INVENTORY OR FOR COSTS WHICH ARE TO
BE REIMBURSED FROM THE ROLLOVER RESERVE FUND.
(B)
LENDER SHALL, UPON WRITTEN REQUEST FROM
BORROWER AND SATISFACTION OF THE REQUIREMENTS SET FORTH IN THIS SECTION 7.3.2,
DISBURSE TO BORROWER AMOUNTS FROM THE REPLACEMENT RESERVE ACCOUNT NECESSARY TO
PAY FOR THE ACTUAL APPROVED COSTS OF REPLACEMENTS OR TO REIMBURSE BORROWER
THEREFOR, UPON COMPLETION OF SUCH REPLACEMENTS (OR, UPON PARTIAL COMPLETION IN
THE CASE OF REPLACEMENTS MADE PURSUANT TO SECTION 7.3.2(E)) AS DETERMINED BY
LENDER.
IN NO EVENT SHALL LENDER BE OBLIGATED TO DISBURSE FUNDS FROM THE
REPLACEMENT RESERVE ACCOUNT IF A DEFAULT OR AN EVENT OF DEFAULT EXISTS.
(C)
EACH REQUEST FOR DISBURSEMENT FROM THE
REPLACEMENT RESERVE ACCOUNT SHALL BE IN A FORM SPECIFIED OR APPROVED BY LENDER
AND SHALL SPECIFY (I) THE SPECIFIC REPLACEMENTS FOR WHICH THE DISBURSEMENT IS
REQUESTED, (II) THE QUANTITY AND PRICE OF EACH ITEM PURCHASED, IF THE
REPLACEMENT INCLUDES THE PURCHASE OR REPLACEMENT OF SPECIFIC ITEMS, (III) THE
PRICE OF ALL MATERIALS (GROUPED BY TYPE OR CATEGORY) USED IN ANY REPLACEMENT
OTHER THAN THE PURCHASE OR REPLACEMENT OF SPECIFIC ITEMS, AND (IV) THE COST OF
ALL CONTRACTED LABOR OR OTHER SERVICES APPLICABLE TO EACH REPLACEMENT FOR WHICH
SUCH REQUEST FOR DISBURSEMENT IS MADE.
WITH EACH REQUEST BORROWER SHALL CERTIFY
THAT ALL REPLACEMENTS HAVE