Common use of Budget Approvals Clause in Contracts

Budget Approvals. No later than thirty (30) days prior to the expiration of each calendar year, Borrowers shall deliver to Lender the proposed Operating Budget and the Capital Expenditure Budget (in each case presented on a monthly and annual basis) for the Properties for the following calendar year. Each such proposed Operating Budget shall identify and set forth Borrowers’ best estimate, after due consideration, of all revenue, costs, and expenses for the Properties, and shall specify gross revenues and Operating Expenses. The Capital Expenditure Budget shall identify and set forth Borrowers’ best estimate, after due consideration, of all costs and expenses contemplated to be necessary in the related budget year (and, as to projects initiated or to be initiated in or prior to the budget year but not completed in the budget year, the estimated cost and completion schedule) for capital improvements and leasehold improvements, leasing commissions and other leasing costs not included in the Operating Budget, and the contemplated sources of payment of the same. In the event that either a Cash Trap Condition or an Event of Default exists, the Operating Budget shall be subject to Lender’s reasonable approval, and upon such approval shall, with any amendments thereto approved by Lender from time to time, constitute the “Approved Operating Budget” hereunder. Borrower shall provide a proposed Approved Operating Budget to Lender for the then-remaining calendar year within five (5) Business Days after the occurrence of a Cash Trap Condition, and thereafter while a Cash Trap Condition exists shall provide a proposed Approved Operating Budget to Lender for each succeeding calendar year at least thirty (30) days prior to the end of each calendar year. If a proposed Approved Operating Budget is not in form and substance reasonably satisfactory to Lender, Lender may disapprove the same and specify the reasons therefor, and Borrowers shall promptly amend and resubmit for approval a revised budget, making such changes as are necessary to comply with the reasonable requirements of Lender; provided that until such time as Borrowers have resubmitted the revised budget and Lender has approved such revised budget, the parties shall operate under the provisions of this Article VII using the budget submitted to Lender as proposed to be revised by Lender, except that actual amounts shall be used for real estate taxes, insurance premiums for insurance required hereunder and utilities expenses. Capital Expenditures shall not be included in the Approved Operating Budget unless Lender shall approve the same in writing in its sole and absolute discretion.

Budget Approvals. No later than thirty forty-five (3045) days prior to the expiration of each calendar year, Borrowers shall deliver to Lender the proposed Operating Budget and the Capital Expenditure Budget (in each case presented on a monthly and annual basis) for each of the Properties for the following calendar year, provided, the proposed Operating Budget and the Capital Expenditure Budget for calendar year 2005 shall be delivered to Lender no later than December 15, 2004. Each such proposed Operating Budget shall identify and set forth Borrowers’ ' best estimate, after due consideration, of all revenue, costs, and expenses for each of the Properties, and shall specify gross revenues and Operating Expenses. The Capital Expenditure Budget shall identify and set forth Borrowers’ ' best estimate, after due consideration, of all costs and expenses contemplated to be necessary in the related budget year (and, as to projects initiated or to be initiated in or prior to the budget year but not completed in the budget year, the estimated cost and completion schedule) for capital improvements and leasehold improvements, leasing commissions and other leasing costs not included in the Operating Budget, and the contemplated sources of payment of the same. In The Operating Budget and the event that either a Cash Trap Condition or an Event of Default exists, the Operating Capital Expenditures Budget shall be subject to Lender’s 's reasonable approval, and upon such approval shall, with any amendments thereto approved by Lender from time to time, constitute the “"Approved Operating Budget” " and "Approved Capital Expenditures Budget" hereunder. Borrower shall provide a proposed Approved Operating Budget to Lender for the then-remaining calendar year within five (5) Business Days after the occurrence of a Cash Trap Condition, and thereafter while a Cash Trap Condition exists shall provide a proposed Approved Operating Budget to Lender for each succeeding calendar year at least thirty (30) days prior to the end of each calendar year. If a proposed Approved Operating Budget or Capital Expenditures Budget is not in form and substance reasonably satisfactory to Lender, Lender may disapprove the same and specify the reasons therefor, and Borrowers shall promptly amend and resubmit for approval a revised budget, making such changes as are necessary to comply with the reasonable requirements of Lender; provided that until such time as Borrowers have resubmitted the revised budget and Lender has approved such revised budget, the parties shall operate under the provisions of this Article VII using the budget submitted to Lender as proposed to be revised by Lender, except that (i) actual amounts shall be used for real estate taxes, insurance premiums for insurance required hereunder and utilities expensesexpenses and (ii) 105% of the last Approved Operating Budget shall be used for operating expenses at the Properties for such succeeding budget period. Capital Expenditures shall not be included in the Approved Operating Budget unless Lender shall approve the same in writing in its sole and absolute discretion. Borrowers agree to incorporate all reasonable revisions required to the proposed Operating Budget and/or a proposed Capital Expenditure Budget by Lender. So long as Borrowers submit a proposed Operating Budget and/or proposed Capital Expenditures Budget to Lender for approval and Borrowers' correspondence requesting such approval contains a bold-faced conspicuous legend at the top of the first page thereof stating that "IF YOU FAIL TO RESPOND TO OR TO EXPRESSLY DENY THIS REQUEST FOR APPROVAL IN WRITING WITHIN THIRTY (30) DAYS, YOUR APPROVAL SHALL BE DEEMED GIVEN," then if Lender shall fail to respond to or expressly deny such request for approval in writing within such 30 day period, then Lender shall be deemed to have approved such proposed Operating Budget and/or proposed Capital Expenditures Budget and any revisions thereto.

Budget Approvals. No later than thirty Mezzanine Borrower shall deliver to Mezzanine Lender the Annual Budget for Mezzanine Lender’s review and approval, which approval shall not be unreasonably withheld, at least sixty (3060) days prior to the expiration end of each calendar yearFiscal Year, Borrowers provided that Mezzanine Lender’s approval shall deliver to Lender the proposed Operating Budget and the not be required for Capital Expenditure Budget (in each case presented on a monthly and annual basis) for the Properties for the following calendar year. Each such proposed Operating Budget shall identify and set forth Borrowers’ best estimate, after due consideration, of all revenue, costs, and expenses for the Properties, and shall specify gross revenues and Operating Expenses. The Capital Expenditure Budget shall identify and set forth Borrowers’ best estimate, after due consideration, of all costs and expenses contemplated to be necessary line items in the related budget year Annual Budget. Any such request for approval shall state in prominent boldfaced type that “YOUR RESPONSE TO THIS REQUEST FOR APPROVAL IS REQUIRED WITHIN FIVE (and, as to projects initiated or to be initiated in or prior to the budget year but not completed in the budget year, the estimated cost and completion schedule5) for capital improvements and leasehold improvements, leasing commissions and other leasing costs not included in the Operating Budget, and the contemplated sources of payment of the same. BUSINESS DAYS AFTER YOUR RECEIPT OF THIS REQUEST.” In the event that either a Cash Trap Condition or an Event of Default exists, the Operating Budget shall be subject Mezzanine Lender fails to Lender’s reasonable respond to such first request for approval, and upon such approval shall, with any amendments thereto approved by Lender from time to time, constitute the “Approved Operating Budget” hereunder. Mezzanine Borrower shall provide send Mezzanine Lender a proposed Approved Operating Budget second request for such approval, which second request shall state in prominent bold-faced type that “THIS IS A SECOND REQUEST FOR YOUR APPROVAL. YOUR RESPONSE TO THIS SECOND REQUEST FOR APPROVAL IS REQUIRED WITHIN FIVE (5) BUSINESS DAYS AFTER YOUR RECEIPT OF THIS REQUEST. FAILURE TO RESPOND TO THIS REQUEST WITHIN FIVE (5) BUSINESS DAYS WILL BE DEEMED TO BE YOUR APPROVAL OF THE ANNUAL BUDGET REQUESTED IN THIS NOTICE.” In the event Mezzanine Lender fails to Lender respond to a second request for approval that includes the then-remaining calendar year notice required herein within five (5) Business Days after Mezzanine Lender’s receipt of such second request, such failure shall be deemed an approval of the occurrence of a Cash Trap Condition, and thereafter while a Cash Trap Condition exists shall provide Annual Budget for which the second request is delivered. To the extent a proposed Approved Operating Annual Budget is not approved or deemed approved by Mezzanine Lender with respect to Lender for each succeeding calendar year at least thirty (30) days any Individual Property on or prior to the end first day of each calendar year. If a proposed Approved Fiscal Year, then the Annual Budget applicable to such Individual Property for the prior Fiscal Year shall continue as the Annual Budget with respect to such Individual Property, subject only to variation for (i) increases in actual Operating Expense line items not to exceed 20% of the amount of such line item provided in the Annual Budget most recently approved by Mezzanine Lender for such Individual Property; (ii) actual increases in Impositions; and (iii) changes in Capital Expenditure line items with respect to such Individual Property, until a new Annual Budget is not approved by Mezzanine Lender for such Individual Property. Except as provided in form this Section, neither Mezzanine Borrower nor Manager shall change or modify the Annual Budget without first providing a copy to Mezzanine Lender for its review and substance reasonably satisfactory to Lender, Lender may disapprove the same and specify the reasons therefor, and Borrowers shall promptly amend and resubmit for approval a revised budget, making such changes as are necessary to comply with the reasonable requirements of Lender; provided that until such time as Borrowers have resubmitted the revised budget and Lender has approved such revised budget, the parties shall operate under the provisions of this Article VII using the budget submitted to Lender as proposed to be revised by Lender, except that actual amounts shall be used for real estate taxes, insurance premiums for insurance required hereunder and utilities expenses. Capital Expenditures shall not be included in the Approved Operating Budget unless Lender shall approve the same in writing in its sole and absolute discretionapproval.