DISBURSEMENT IN EXCESS OF $50,000)) PERFORMANCE OF THE WORK
ASSOCIATED WITH SUCH APPROVED CAPITAL EXPENSE; AND (III) THE REQUEST FOR
DISBURSEMENT IS ACCOMPANIED BY (A) AN OFFICER'S CERTIFICATE CERTIFYING (1) THAT
SUCH FUNDS WILL BE USED TO PAY OR REIMBURSE BORROWER FOR APPROVED CAPITAL
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)
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THAT THE SAME HAS NOT BEEN THE SUBJECT OF A PREVIOUS DISBURSEMENT, AND (4) THAT
ALL PREVIOUS DISBURSEMENTS HAVE BEEN USED TO PAY THE PREVIOUSLY IDENTIFIED
APPROVED CAPITAL EXPENSES, AND (B) LIEN WAIVERS OR OTHER EVIDENCE OF PAYMENT
SATISFACTORY TO LENDER, (C) WITH RESPECT TO ANY DISBURSEMENT THAT EXCEEDS
$50,000, AT LENDER'S OPTION, A TITLE SEARCH FOR THE PROPERTY INDICATING THAT THE
PROPERTY IS FREE FROM ALL LIENS, CLAIMS AND OTHER ENCUMBRANCES NOT PREVIOUSLY
APPROVED BY LENDER AND (D) SUCH OTHER EVIDENCE AS LENDER SHALL REASONABLY
REQUEST THAT THE APPROVED CAPITAL EXPENSES AT THE PROPERTY TO BE FUNDED BY THE
REQUESTED DISBURSEMENT HAVE BEEN COMPLETED AND ARE PAID FOR OR WILL BE PAID UPON
SUCH DISBURSEMENT TO BORROWER. ANY SUCH DISBURSEMENT OF MORE THAN $10,000 TO PAY
(RATHER THAN REIMBURSE) APPROVED CAPITAL EXPENSES MAY, AT LENDER'S OPTION, BE
MADE BY JOINT CHECK PAYABLE TO BORROWER AND THE PAYEE ON SUCH APPROVED CAPITAL
EXPENSES.
3.4.2
GUARANTY IN LIEU OF RESERVE.
(A)
IN LIEU OF A REQUIREMENT FOR MONTHLY DEPOSITS BY BORROWER INTO THE
CAPITAL RESERVE SUBACCOUNT, GUARANTOR, PURSUANT TO THE GUARANTY, HAS (AMONG
OTHER OBLIGATIONS THEREUNDER) GUARANTEED PAYMENT AND PERFORMANCE IN FULL OF ALL
CAPITAL EXPENSES AND WORK RELATING THERETO AND AGREED TO PAY TO LENDER, UPON
LENDER'S DEMAND FOLLOWING THE OCCURRENCE AND DURING THE CONTINUANCE OF AN EVENT
OF DEFAULT, AN AMOUNT EQUAL TO THE GUARANTY LIMIT AMOUNT, DETERMINED AS THE SUM
OF VARIOUS AMOUNTS, INCLUDING AN AMOUNT EQUAL TO THE CAPITAL RESERVE OFFSET
AMOUNT (AS HEREAFTER DEFINED). AS USED HEREIN, "CAPITAL RESERVE OFFSET AMOUNT"
SHALL MEAN, ON ANY DATE OF DETERMINATION, AN AMOUNT EQUAL TO THE GREATER OF
(I) THE ZERO AND (II) THE FOLLOWING:
(1)
the product of $91,228 (the "Base Capital Amount"), multiplied by
a fraction, the numerator of which is the number of Calendar Quarters which have
ended (and for which the reports required under Section 6.3.3 hereof have been
delivered or were required to have been delivered) as of the date of
determination (a "Calendar Quarter" shall be the three calendar month period
ending on September 30, 2006 and each three calendar month period ending on each
December 31, March 31, June 30 and September 30, thereafter), and the
denominator of which is four (4); for example, a calculation made October 10,
2007 would be for the 5 Calendar Quarters ending September 30, 2006,
December 31, 2006, March 31, 2007, June 30, 2007 and September 30, 2007, and
thus $ $91,228 X [5/4] = $114,035); minus
(2)
the Aggregate Approved