ANY SWING LINE LOAN IF AS A RESULT THEREOF, (I) THE SUM OF (A) THE
AGGREGATE OUTSTANDING PRINCIPAL BALANCES OF ALL LOANS, SWING LINE LOANS AND
LETTER OF CREDIT ADVANCES PLUS (B) THE AGGREGATE MAXIMUM LIABILITY OF ALL
ISSUERS UNDER OUTSTANDING LETTERS OF CREDIT OR TRI-PARTY AGREEMENTS WOULD EXCEED
THE REVOLVING SUBLIMIT OR (II) THE AGGREGATE OUTSTANDING PRINCIPAL BALANCES OF
ALL LOANS, LETTER OF CREDIT ADVANCES AND SWING LINE LOANS WOULD EXCEED THE
THEN-CURRENT BORROWING BASE AVAILABILITY.
THE BORROWERS MAY REQUEST SWING LINE
LOANS FOR THE PURPOSE OF THE ACQUISITION OF REAL ESTATE AND THE CONSTRUCTION
THEREON OF UNITS AND IMPROVEMENTS AND FOR GENERAL CORPORATE PURPOSES.
BORROWERS
MAY BORROW, REPAY AND RE-BORROW SWING LINE LOANS AT ANY TIME AND FROM TIME TO
TIME PRIOR TO THE MATURITY DATE.
IF A SWING LINE LOAN IS REQUESTED AT A TIME
WHEN ANY LENDER IS A DEFAULTING LENDER OR HAS GIVEN NOTICE TO AGENT OF ITS
INTENT TO BE A DEFAULTING LENDER, THE AMOUNT OF THE SWING LINE LOAN ADVANCED
SHALL BE REDUCED BY SUCH DEFAULTING LENDER'S PRO-RATA SHARE THEREOF.
21
2.1.3
AMOUNT AND AVAILABILITY OF LETTERS OF CREDIT AND
TRI-PARTY AGREEMENTS.
PROVIDED THAT NO EVENT OF DEFAULT HAS OCCURRED AND IS
CONTINUING, AND SUBJECT TO THE TERMS AND CONDITIONS SET FORTH HEREIN, BORROWERS
MAY REQUEST, AND AGENT, PURSUANT TO THIS SECTION 2.1.2 SHALL ISSUE OR EXECUTE ON
BEHALF OF THE LENDERS, (I) LETTERS OF CREDIT OR TRI-PARTY AGREEMENTS TO ASSURE
GOVERNMENTAL AUTHORITIES OF THE COMPLETION OF IMPROVEMENTS THAT ARE TO BE
CONSTRUCTED IN PROJECTS AND FINANCED WITH THE PROCEEDS OF LOANS, BUT ONLY IF IN
EACH INSTANCE AGENT'S LIABILITY UNDER SUCH LETTER OF CREDIT OR TRI-PARTY
AGREEMENT IS SUBJECT TO PERIODIC REDUCTION BY THE BENEFICIARY THEREOF AS
CONSTRUCTION OF THE SUBJECT IMPROVEMENTS IS COMPLETED, (II) LETTERS OF CREDIT TO
ASSURE GOVERNMENTAL AUTHORITIES THAT BORROWERS WILL PERFORM THEIR MAINTENANCE
OBLIGATIONS WITH RESPECT TO IMPROVEMENTS FINANCED WITH THE PROCEEDS OF LOANS,
(III) LETTERS OF CREDIT THAT ARE IN LIEU OF CASH DEPOSITS UNDER AGREEMENTS OF
SALE FOR THE PURCHASE OF REAL ESTATE, LOTS OR UNITS BY BORROWERS PERMITTED
PURSUANT TO SECTION 8.5 AND NOT SUBJECT TO PURCHASE MONEY MORTGAGE OTHER THAN
THOSE SECURING THE INDEBTEDNESS; AND (IV) LETTERS OF CREDIT FOR GENERAL WORKING
CAPITAL AND CORPORATE PURPOSES OF BORROWERS THAT ARE NECESSARY TO THE OPERATION
OF THEIR BUSINESS.
LETTERS OF CREDIT OF THE TYPES DESCRIBED IN CLAUSES
(III) AND (IV) ARE SOMETIMES REFERRED TO IN THIS AGREEMENT AS "FINANCIAL LETTERS
OF CREDIT."
EACH LETTER OF CREDIT IDENTIFIED ON SCHEDULE 1.1D ALSO SHALL BE
DEEMED TO HAVE BEEN ISSUED ON BEHALF OF THE LENDERS.
NO LETTER OF CREDIT OR
TRI-PARTY AGREEMENT SHALL BE ISSUED OR EXECUTED BY AGENT IF, AS A RESULT
THEREOF, (X) THE AGGREGATE LIABILITY OF AGENT AND ALL OTHER ISSUERS UNDER ALL
LETTERS OF CREDIT AND TRI-PARTY AGREEMENTS THEN OUTSTANDING OR IN EFFECT WOULD
EXCEED THE LETTER OF CREDIT SUBLIMIT OR (Y) THE AGGREGATE LIABILITY OF AGENT
UNDER ALL OUTSTANDING FINANCIAL LETTERS OF CREDIT WOULD EXCEED $25,000,000.
2.1.4
LETTERS OF CREDIT