FOR PAYMENT OF ITEMS CONSTITUTING APPROVED OPERATING
EXPENSES, WHICH ARE NOT INCLUDED IN THE APPROVED OPERATING BUDGET), SHALL BE
TRANSFERRED INTO A SUBACCOUNT FOR THE PURPOSE OF PAYMENT OF APPROVED OPERATING
EXPENSES FOR THE MONTH IN WHICH SUCH PAYMENT DATE OCCURS (THE "OPERATING EXPENSE
SUBACCOUNT"). PROVIDED NO EVENT OF DEFAULT HAS OCCURRED AND IS CONTINUING,
LENDER SHALL DISBURSE FUNDS HELD IN THE OPERATING EXPENSE SUBACCOUNT TO BORROWER
(OR AT BORROWER'S DIRECTION, TO THE MANAGER), WITHIN FIVE (5) BUSINESS DAYS
AFTER DELIVERY BY BORROWER TO LENDER OF A REQUEST THEREFOR (BUT NOT MORE OFTEN
THAN WEEKLY), IN MINIMUM AMOUNTS OF AT LEAST $1,000, PROVIDED (I) SUCH
DISBURSEMENT IS FOR AN APPROVED OPERATING EXPENSE; AND (II) SUCH DISBURSEMENT IS
ACCOMPANIED BY (A) AN OFFICER'S CERTIFICATE CERTIFYING (1) THAT SUCH FUNDS WILL
BE USED TO PAY APPROVED OPERATING EXPENSES AND A DESCRIPTION THEREOF, (2) THAT
ALL OUTSTANDING TRADE PAYABLES (OTHER THAN THOSE NOT YET DUE AND PAYABLE OR
THOSE TO BE PAID FROM THE REQUESTED DISBURSEMENT OR THOSE CONSTITUTING PERMITTED
INDEBTEDNESS) HAVE BEEN PAID IN FULL, (3) THAT THE SAME HAS NOT BEEN THE SUBJECT
OF A PREVIOUS DISBURSEMENT, AND (4) THAT ALL PREVIOUS DISBURSEMENTS HAVE BEEN OR
WILL BE USED TO PAY THE PREVIOUSLY IDENTIFIED APPROVED OPERATING EXPENSES, AND
(B) REASONABLY DETAILED DOCUMENTATION SATISFACTORY TO LENDER AS TO THE AMOUNT,
NECESSITY AND PURPOSE THEREFOR. NOTWITHSTANDING ANYTHING TO THE CONTRARY
CONTAINED HEREIN, TO THE EXTENT THAT (I) BORROWER HAS REQUESTED A DISBURSEMENT
OF FUNDS FROM THE OPERATING EXPENSE SUBACCOUNT IN ACCORDANCE WITH THE FOREGOING
PROVISIONS AND (II) AT THE TIME OF SUCH REQUEST, THE FUNDS THAT HAVE BEEN
COLLECTED IN THE OPERATING EXPENSE SUBACCOUNT ARE INSUFFICIENT TO COVER THE
SAME, THEN LENDER SHALL NONETHELESS DISBURSE
24
ADDITIONAL FUNDS THAT ARE THEREAFTER DEPOSITED INTO THE OPERATING EXPENSE
SUBACCOUNT TO BORROWER (WITHOUT ANY REQUIREMENT FOR BORROWER TO SUBMIT AN
ADDITIONAL REQUEST THEREFOR); PROVIDED THAT SUFFICIENT FUNDS HAVE BEEN COLLECTED
IN THE DEPOSIT ACCOUNT TO MAKE THE PAYMENTS REQUIRED UNDER CLAUSES (I) - (V) OF
SECTION 3.11(A) ON THE NEXT SUCCEEDING PAYMENT DATE.
3.7
CASUALTY/CONDEMNATION SUBACCOUNT. BORROWER SHALL PAY, OR CAUSE TO
BE PAID, TO LENDER ALL PROCEEDS OR AWARDS DUE TO ANY CASUALTY OR CONDEMNATION TO
BE TRANSFERRED TO A SUBACCOUNT (THE "CASUALTY/CONDEMNATION SUBACCOUNT") IN
ACCORDANCE WITH THE PROVISIONS OF ARTICLE 7 HEREOF. ALL AMOUNTS IN THE
CASUALTY/CONDEMNATION SUBACCOUNT SHALL DISBURSED IN ACCORDANCE WITH THE
PROVISIONS OF ARTICLE 7 HEREOF.
3.8
SECURITY DEPOSITS. BORROWER SHALL KEEP ALL SECURITY DEPOSITS UNDER
LEASES IN ACCORDANCE WITH APPLICABLE LEGAL REQUIREMENTS. AFTER THE OCCURRENCE
AND DURING THE CONTINUANCE OF AN EVENT OF DEFAULT, BORROWER SHALL, UPON LENDER'S
REQUEST, IF PERMITTED BY APPLICABLE LEGAL REQUIREMENTS, TURN OVER TO LENDER THE
SECURITY DEPOSITS (AND ANY INTEREST THERETOFORE EARNED THEREON) UNDER LEASES, TO
BE HELD BY LENDER IN A SUBACCOUNT (THE "SECURITY DEPOSIT SUBACCOUNT") SUBJECT TO
THE TERMS OF THE LEASES. SECURITY DEPOSITS HELD IN THE SECURITY DEPOSIT
SUBACCOUNT WILL BE RELEASED BY LENDER UPON NOTICE FROM BORROWER TOGETHER WITH
SUCH EVIDENCE AS LENDER MAY REASONABLY REQUEST THAT SUCH SECURITY DEPOSIT