Common use of Ffe Reserve Funds Clause in Contracts

Ffe Reserve Funds. (a) Beginning on the Monthly Payment Date occurring on December 9, 2019 and on each Monthly Payment Date thereafter, Borrower shall deposit into an Eligible Account held by Lender or Servicer (the “FF&E Reserve Account”) for FF&E costs, an amount equal to 1/12th of 4% of the greater of (i) gross revenues for the Property in the preceding calendar year or (ii) the projected gross revenues for the Property for the current calendar year according to the most recently submitted Annual Budget (the “FF&E Reserve Monthly Deposit”). Amounts deposited pursuant to this Section 7.3 are referred to herein as the “FF&E Reserve Funds”. Lender may reassess its estimate of the amount necessary for FF&E costs from time to time, and may require Borrower to increase the monthly deposits required pursuant to this Section 7.3 upon thirty (30) days’ notice to Borrower if Lender determines in its reasonable discretion that an increase is necessary to maintain proper operation of the Property. (b) Lender shall disburse FF&E Reserve Funds only for costs associated with FF&E reasonably approved by Lender. Lender shall disburse to Borrower the FF&E Reserve Funds upon satisfaction by Borrower of each of the following conditions: (i) Borrower shall submit a request for payment to Lender at least ten (10) days prior to the date on which Borrower requests such payment be made and specifies the FF&E to be paid; (ii) on the date such request is received by Lender and on the date such payment is to be made, no Event of Default shall exist and remain uncured, (iii) Lender shall have received a certificate from Borrower (A) stating that the items to be funded by the requested disbursement are FF&E, (B) stating that all FF&E at the Property to be funded by the requested disbursement have been installed in a good and workmanlike manner and in accordance with all applicable Legal Requirements, such certificate to be accompanied by a copy of any license, permit or other approval required by any Governmental Authority in connection with the FF&E, (C) identifying each Person that supplied materials or labor in connection with the FF&E to be funded by the requested disbursement and (D) stating that each such Person has been paid in full or will be paid in full upon such disbursement, such certificate to be accompanied by lien waivers, invoices and/or other evidence of payment satisfactory to Lender; (iv) at Lender’s option, if the disbursement amount exceeds $25,000, Lender shall have received a title search for the Property indicating that the Property is free from all liens, claims and other encumbrances other than Permitted Encumbrances; (v) at Lender’s option, if the disbursement exceeds $25,000, Lender shall have received a report satisfactory to Lender in its reasonable discretion from an architect or engineer approved by Lender in respect of such architect or engineer’s inspection of the applicable work; and (vi) Lender shall have received such other evidence as Lender shall reasonably request that the FF&E at the Property to be funded by the requested disbursement has, as applicable, been completed and are paid for or will be paid upon such disbursement to Borrower. Lender shall not be required to disburse FF&E Reserve Funds more frequently than once each calendar month nor in an amount less than the Minimum Disbursement Amount (or a lesser amount if the total amount of FF&E Reserve Funds is less than the Minimum Disbursement Amount, in which case only one disbursement of the amount remaining in the account shall be made). (c) Nothing in this Section 7.3 shall (i) make Lender responsible for any costs associated with any FF&E; (ii) require Lender to expend funds in addition to the FF&E Reserve Funds to pay for or complete, as applicable, any FF&E; (iii) obligate Lender to proceed with any FF&E work; or (iv) obligate Lender to demand from Borrower additional sums to pay for or complete, as applicable, any FF&E. (d) Borrower shall permit Lender and Lender’s agents and representatives (including, without limitation, Lender’s engineer, architect, or inspector) or third parties to enter onto the Property during normal business hours (subject to the rights of any Tenants under their Leases) to inspect the progress of any FF&E work and all materials being used in connection therewith and to examine all plans and shop drawings relating to such FF&E work. Borrower shall cause all contractors and subcontractors to cooperate with Lender or Lender’s representatives or such other Persons described above in connection with inspections described in this Section.

Ffe Reserve Funds. (a) Beginning on the Monthly Payment Date occurring on December 9, 2019 and on each Monthly Payment Date thereafter, Borrower shall deposit into an Eligible Account held by with Lender or Servicer (on the “FF&E Reserve Account”) for FF&E costs, an amount equal to 1/12th of 4% Closing Date one-twelfth of the greater amount of (i) gross revenues for the Property in the preceding calendar year or (ii) the projected gross revenues for the Property for the current calendar year according to the most recently submitted Annual Approved FF&E Budget (the “FF&E Reserve Monthly Deposit”). The amount of the FF&E Reserve Deposit shall be recalculated annually during the term of the Loan, as of January 1 of each year (or as soon thereafter as Gross Income from Operations for the preceding year shall be determined to Lender’s reasonable satisfaction) such that the FF&E Reserve Deposit shall be equal to four (4%) percent of the prior year’s Gross Income from Operations divided by twelve (12). Amounts so deposited pursuant to this Section 7.3 are shall hereinafter be referred to herein as the Borrower’s “FF&E Reserve Funds”. Lender may reassess its estimate of ” and the amount necessary for account in which such amounts are held shall hereinafter be referred to as Borrower’s “FF&E costs from time to time, and may require Borrower to increase the monthly deposits required pursuant to this Section 7.3 upon Reserve Account.” Within thirty (30) days’ notice days following the end of each calendar quarter, Borrower shall provide to Lender a preliminary report with respect to the expenditures made by or on behalf of Borrower if Lender determines in its reasonable discretion with respect to the Property for FF&E during such calendar quarter. In the event that an increase the lesser of (a) the Approved Annual FF&E Budget for such calendar quarter (provided such Approved Annual FF&E Budget is necessary to maintain proper operation not less than four (4%) percent of the Property. Gross Income from Operations for such quarter) or (b) Lender four (4%) percent of the actual Gross Income from Operations for such quarter, exceeds the actual expenditures made by Borrower for FF&E for such quarter, Borrower shall disburse deposit an amount equal to any such difference in the FF&E Reserve Account to be held as FF&E Reserve Funds only to be disbursed pursuant to the provisions of this Section 7.3. Notwithstanding the foregoing, the amount of any such deposit required to be made by Borrower shall be reduced by the amount of any actual expenditure made by Borrower for costs associated with any FF&E reasonably approved completed prior to the calendar quarter in which such FF&E was scheduled to be made pursuant to the Approved Annual FF&E Budget. If the actual expenditures made by Lender. Borrower for FF&E exceeds the lesser of (x) the Approved Annual FF&E Budget for such calendar quarter (provided such Approved Annual FF&E Budget is not less than four (4%) percent of the Gross Income from Operations for such quarter) or (b) four (4%) percent of the actual Gross Income from Operations for such quarter, Lender shall disburse reimburse Borrower for such excess to the extent that funds are available from the FF&E Reserve Account within fifteen (15) days from Borrower’s request. To the extent there are not sufficient funds in the FF&E Reserve Account to reimburse Borrower for any excess actual expenditures during such calendar quarter, such excess expenditures shall be added to the actual expenditures for the next calendar quarter in the determination of any amounts required to be deposited in the FF&E Reserve Account for such calendar quarter. In lieu of making any required deposits to the FF&E Reserve Account (other than the FF&E Reserve Deposit), Borrower may deliver to Lender a Letter of Credit in an amount equal to the amount that is required to be deposited into the FF&E Reserve Account. Such Letter of Credit shall constitute additional collateral for the Loan and Lender shall have the right to draw down upon such Letter of Credit and apply the proceeds thereof for the purposes set forth in the Approved FF&E Budget if Borrower fails to do so within a reasonable time after notice from Lender, or Lender may apply such sums as otherwise provided in this Agreement following an Event of Default. All earnings or interest on the FF&E Reserve Funds upon satisfaction by Borrower of each of the following conditions: (i) Borrower shall submit a request for payment to Lender at least ten (10) days prior to the date on which Borrower requests such payment be made and specifies the FF&E to be paid; (ii) on the date such request is received by Lender and on the date such payment is to be made, no Event of Default shall exist and remain uncured, (iii) Lender shall have received a certificate from Borrower (A) stating that the items to be funded by the requested disbursement are FF&E, (B) stating that all FF&E at the Property to be funded by the requested disbursement have been installed in a good and workmanlike manner and in accordance with all applicable Legal Requirements, such certificate to be accompanied by a copy of any license, permit or other approval required by any Governmental Authority in connection with the FF&E, (C) identifying each Person that supplied materials or labor in connection with the FF&E to be funded by the requested disbursement and (D) stating that each such Person has been paid in full or will be paid in full upon such disbursement, such certificate to be accompanied by lien waivers, invoices and/or other evidence of payment satisfactory to Lender; (iv) at Lender’s option, if the disbursement amount exceeds $25,000, Lender shall have received a title search for the Property indicating that the Property is free from all liens, claims and other encumbrances other than Permitted Encumbrances; (v) at Lender’s option, if the disbursement exceeds $25,000, Lender shall have received a report satisfactory to Lender in its reasonable discretion from an architect or engineer approved by Lender in respect of such architect or engineer’s inspection of the applicable work; and (vi) Lender shall have received such other evidence as Lender shall reasonably request that the FF&E at the Property to be funded by the requested disbursement has, as applicable, been completed and are paid for or will be paid upon such disbursement to Borrower. Lender shall not be required to disburse FF&E Reserve Funds more frequently than once each calendar month nor in an amount less than the Minimum Disbursement Amount (or a lesser amount if the total amount of FF&E Reserve Funds is less than the Minimum Disbursement Amount, in which case only one disbursement of the amount remaining in the account shall be made). (c) Nothing in this Section 7.3 shall (i) make Lender responsible for any costs associated with any FF&E; (ii) require Lender to expend funds in addition to and become part of the FF&E Reserve Funds to pay for or complete, and shall be disbursed as applicable, any FF&E; (iii) obligate Lender to proceed with any FF&E work; or (iv) obligate Lender to demand from Borrower additional sums to pay for or complete, as applicable, any FF&E. (d) Borrower shall permit Lender and Lender’s agents and representatives (including, without limitation, Lender’s engineer, architect, or inspector) or third parties to enter onto the Property during normal business hours (subject to the rights of any Tenants under their Leases) to inspect the progress of any FF&E work and all materials being used in connection therewith and to examine all plans and shop drawings relating to such FF&E work. Borrower shall cause all contractors and subcontractors to cooperate with Lender or Lender’s representatives or such other Persons described above in connection with inspections described provided in this SectionSection 7.3.

Ffe Reserve Funds. On a monthly basis, Borrowers or Operating Lessee shall, or shall cause Manager to, deposit into the “FF&E Reserve” under the Management Agreement (athe “Manager FF&E Reserve”) Beginning the FF&E Reserve Amount. To the extent that the Manager FF&E Reserve is not maintained by Manager (or not maintained in the amounts required hereby), on the Monthly Payment Date occurring on December 9last Business Day of each month commencing with the last Business Day of October, 2019 and on each Monthly Payment Date thereafter2012, Borrower Borrowers shall deposit into an Eligible the FF&E Reserve Account held by Lender or Servicer the FF&E Reserve Amount with respect to the second (2nd) immediately preceding calendar month (the “amounts on deposit in the FF&E Reserve Account”) for FF&E costs, an amount equal Account from time to 1/12th of 4% of the greater of (i) gross revenues for the Property in the preceding calendar year or (ii) the projected gross revenues for the Property for the current calendar year according to the most recently submitted Annual Budget (the “FF&E Reserve Monthly Deposit”). Amounts deposited pursuant to this Section 7.3 time are referred to herein as hereinafter called the “FF&E Reserve Funds”) and deliver to Administrative Agent a certificate setting forth in reasonable detail Borrowers’ calculation of such FF&E Reserve Amount. Lender may reassess its estimate of the amount necessary for FF&E costs from From time to time, but not more frequently than once per month, and provided no Default shall have occurred and then be continuing and the Indebtedness shall not have been accelerated, Borrowers may submit to Administrative Agent a written request for disbursement from the FF&E Reserve Account for FF&E Expenditures approved by Administrative Agent. Each such written request shall (i) specify the FF&E Expenditures for which such disbursement is requested and (ii) include a certification from Borrowers that the costs and expenses that are the subject of such request have not been the subject of a prior request. Borrowers shall promptly deliver to Administrative Agent copies of paid invoices (or unpaid invoices to which the requested disbursement relates and is to be applied) and lien waivers as Administrative Agent may reasonably require Borrower in connection with such requested disbursement and the subject matter thereof. Provided that the foregoing conditions are satisfied, and all other conditions applicable to increase the monthly deposits required pursuant to requested disbursement set forth in this Section 7.3 upon thirty (30) days’ notice to Borrower if Lender determines in its reasonable discretion that an increase is necessary to maintain proper operation of the Property. (b) Lender 1.4.4 are satisfied, Administrative Agent shall disburse FF&E Reserve Funds only for costs associated with FF&E reasonably approved by Lender. Lender shall disburse to Borrower the FF&E Reserve Funds upon satisfaction by Borrower of each of the following conditions: (i) Borrower shall submit a request for payment to Lender at least ten (10) days prior to the date on which Borrower requests such payment be made and specifies the FF&E to be paid; (ii) on the date such request is received by Lender and on the date such payment is to be made, no Event of Default shall exist and remain uncured, (iii) Lender shall have received a certificate from Borrower (A) stating that the items to be funded by the requested disbursement are FF&E, (B) stating that all FF&E at the Property to be funded by the requested disbursement have been installed in a good and workmanlike manner and Borrowers or Operating Lessee in accordance with all applicable Legal RequirementsBorrowers instructions delivered to Administrative Agent, which funds Borrowers and Operating Lessee shall only use for the purpose of paying for such certificate to be accompanied by a copy approved FF&E Expenditures or of reimbursing itself for the prior payment thereof. Except as otherwise provided herein, while any license, permit or other approval required by any Governmental Authority in connection with Default is continuing and the FF&E, (C) identifying each Person that supplied materials or labor in connection with the FF&E to be funded by the requested disbursement and (D) stating that each such Person has been paid in full or will be paid in full upon such disbursement, such certificate to be accompanied by lien waivers, invoices and/or other evidence of payment satisfactory to Lender; (iv) at Lender’s option, if the disbursement amount exceeds $25,000, Lender Indebtedness shall have received a title search for the Property indicating that the Property is free from all liensbeen accelerated, claims and other encumbrances other than Permitted Encumbrances; (v) at Lender’s optionAdministrative Agent may, if the disbursement exceeds $25,000, Lender but shall have received a report satisfactory to Lender in its reasonable discretion from an architect or engineer approved by Lender in respect of such architect or engineer’s inspection of the applicable work; and (vi) Lender shall have received such other evidence as Lender shall reasonably request that the FF&E at the Property to be funded by the requested disbursement hasno obligation to, as applicable, been completed and are paid for or will be paid upon such disbursement to Borrower. Lender shall not be required to disburse FF&E Reserve Funds more frequently than once each calendar month nor in an amount less than the Minimum Disbursement Amount (or a lesser amount if the total amount make disbursements of FF&E Reserve Funds is less than the Minimum Disbursement Amount, in which case only one disbursement of the Funds. Any amount remaining in the account FF&E Reserve Account after payment in full of all Obligations in immediately available funds shall be made). (c) Nothing in this Section 7.3 returned to Borrowers. Borrowers and Operating Lessee shall (i) make Lender responsible for not withdraw any costs associated with any FF&E; (ii) require Lender to expend funds in addition amount from the Manager FF&E Reserve pursuant to the Management Side Letter except for such amount, if any, that exceeds the aggregate amount that would have been on deposit in the Manager FF&E Reserve Funds to pay for or complete, as applicable, any FF&E; (iii) obligate Lender to proceed with any of the day such withdrawal is made if all FF&E work; or (iv) obligate Lender to demand from Borrower additional sums to pay for or complete, Reserve Amounts required herein were deposited in the Manager FF&E Reserve as applicable, any FF&E. (d) Borrower shall permit Lender and Lender’s agents and representatives (including, without limitation, Lender’s engineer, architect, or inspector) or third parties to enter onto the Property during normal business hours (subject to the rights of any Tenants under their Leases) to inspect the progress of any FF&E work and all materials being used in connection therewith and to examine all plans and shop drawings relating to such FF&E work. Borrower shall cause all contractors and subcontractors to cooperate with Lender or Lender’s representatives or such other Persons described above in connection with inspections described in this Sectionwhen required herein.

Ffe Reserve Funds. (a) Beginning on the Monthly Payment Date occurring on December 9, 2019 and Borrower shall deposit with Lender on each Monthly Payment Date thereafter, Borrower shall deposit into an Eligible Account held by Lender or Servicer (the “FF&E Reserve Account”) for FF&E costs, an amount equal to 1/12th the FF&E Reserve Monthly Deposit for the costs and expenses of 4% replacement and maintenance of the greater of (i) gross revenues Property, Improvements and Personal Property, including furniture, furnishings, fixtures and equipment for the Property in the preceding calendar year or (ii) the projected gross revenues for hotel on the Property for the current calendar year according as set forth in a budget as approved by Lender, or such other costs and expenses as reasonably approved by Lender, relating to the most recently submitted Annual Budget replacement and maintenance of the Property, Improvements and Personal Property, including furniture, furnishings, fixtures and equipment that may be incurred following the date hereof to fully equip (collectively, the “FF&E Reserve Monthly DepositWork”). Amounts deposited pursuant to this Section 7.3 8.8 are referred to herein as the “FF&E Reserve Funds”. Lender may reassess its estimate Based on the annual operating statements for the Property, the FF&E Reserve Monthly Deposit shall be one-twelfth of four percent (4.0%) of the amount necessary Operating Income for the prior fiscal year. All FF&E costs from time to time, and may require Borrower to increase Reserve Funds shall be held by Lender or Servicer in an Eligible Account (the monthly deposits required pursuant to this Section 7.3 upon thirty (30) days’ notice to Borrower if Lender determines in its reasonable discretion that an increase is necessary to maintain proper operation of the Property“FF&E Reserve Account”). (b) Lender shall disburse FF&E Reserve Funds only for costs associated with FF&E reasonably approved by Lender. Lender shall disburse to Borrower the FF&E Reserve Funds upon satisfaction by Borrower of each of the following conditions: (i) Borrower shall submit a request for payment to Lender at least ten (10) days prior to the date on which Borrower requests such payment be made and specifies the cost of the FF&E Work to be paid; (ii) on the date such request is received by Lender and on the date such payment is to be made, no Event of Default shall exist and remain uncured, ; (iii) Lender shall have reviewed and approved the invoice in respect of the furniture, fixtures or equipment to be acquired; (iv) Intentionally Omitted; (v) Lender shall have received a certificate from Borrower (A) stating that the items to be funded by the requested disbursement are FF&E, (B) stating that all FF&E at the Property Work to be funded by the requested disbursement have been installed completed in a good and workmanlike manner and in accordance with all applicable Legal RequirementsApplicable Law, such certificate to be accompanied by a copy of any license, permit or other approval required by any Governmental Authority required in connection with the FF&EFF&E Work, (CB) identifying each Person that supplied materials or labor in connection with the FF&E Work to be funded by the requested disbursement and (DC) stating that each such Person has been paid in full or will be paid in full upon such disbursement, such certificate to be accompanied by lien waivers, invoices and/or waivers or other evidence of payment satisfactory to Lender; (ivvi) at Lender’s option, if the disbursement amount exceeds $25,000, Lender shall have received 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 (other than Permitted Encumbrances; (v) at Lender’s option, if the disbursement exceeds $25,000, Lender shall have received a report satisfactory to Lender in its reasonable discretion from an architect or engineer approved by Lender in respect of such architect or engineer’s inspection of the applicable work); and (vivii) Lender shall have received such other evidence as Lender shall reasonably request that the FF&E at the Property Work to be funded by the requested disbursement has, as applicable, have been completed (to the extent applicable) and are paid for or will be paid upon such disbursement to Borrower. Lender shall not be required to disburse FF&E Work Reserve Funds more frequently than once each calendar month nor in an amount less than the Minimum Disbursement Amount (or a lesser amount if the total amount of FF&E Reserve Funds is less than the Minimum Disbursement Amount, in which case only one disbursement of the amount remaining in the account shall be made). (c) Nothing in this Section 7.3 shall (i) make Lender responsible for any costs associated with any FF&E; (ii) require Lender to expend funds in addition to the FF&E Reserve Funds to pay for or complete, as applicable, any FF&E; (iii) obligate Lender to proceed with any FF&E work; or (iv) obligate Lender to demand from Borrower additional sums to pay for or complete, as applicable, any FF&E. (d) Borrower shall permit Lender and Lender’s agents and representatives (including, without limitation, Lender’s engineer, architect, or inspector) or third parties to enter onto the Property during normal business hours (subject to the rights of any Tenants under their Leases) to inspect the progress of any FF&E work and all materials being used in connection therewith and to examine all plans and shop drawings relating to such FF&E work. Borrower shall cause all contractors and subcontractors to cooperate with Lender or Lender’s representatives or such other Persons described above in connection with inspections described in this Section.

Ffe Reserve Funds. (a) Beginning on the Monthly Payment Date occurring on December 9, 2019 and on each Monthly Payment Date thereafter, Borrower shall deposit into an Eligible Account held by with Lender or Servicer (on the “FF&E Reserve Account”) for FF&E costs, an amount equal to 1/12th of 4% Closing Date one-twelfth of the greater amount of (i) gross revenues for the Property in the preceding calendar year or (ii) the projected gross revenues for the Property for the current calendar year according to the most recently submitted Annual Approved FF&E Budget (the “FF&E Reserve Monthly Deposit”). The amount of the FF&E Reserve Deposit shall be recalculated annually during the term of the Loan, as of January 1 of each year (or as soon thereafter as Gross Income from Operations for the preceding year shall be determined to Lender’s reasonable satisfaction) such that the FF&E Reserve Deposit shall be equal to four (4%) percent of the prior year’s Gross Income from Operations divided by twelve (12). Amounts so deposited pursuant to this Section 7.3 are shall hereinafter be referred to herein as the Borrower’s “FF&E Reserve Funds”. Lender may reassess its estimate of ” and the amount necessary for account in which such amounts are held shall hereinafter be referred to as Borrower’s “FF&E costs from time to time, and may require Borrower to increase the monthly deposits required pursuant to this Section 7.3 upon Reserve Account.” Within thirty (30) days’ notice days following the end of each calendar quarter, Borrower shall provide to Lender a preliminary report with respect to the expenditures made by or on behalf of Borrower if Lender determines in its reasonable discretion with respect to the Property for FF&E during such calendar quarter. In the event that an increase the lesser of (a) the Approved Annual FF&E Budget for such calendar quarter (provided such Approved Annual FF&E Budget is necessary to maintain proper operation not less than four (4%) percent of the Property. Gross Income from Operations for such quarter) or (b) Lender four (4%) percent of the actual Gross Income from Operations for such quarter, exceeds the actual expenditures made by Borrower for FF&E for such quarter, Borrower shall disburse deposit an amount equal to any such difference in the FF&E Reserve Account to be held as FF&E Reserve Funds only to be disbursed pursuant to the provisions of this Section 7.3. Notwithstanding the foregoing, the amount of any such deposit required to be made by Borrower shall be reduced by the amount of any actual expenditure made by Borrower for costs associated with any FF&E reasonably approved completed prior to the calendar quarter in which such FF&E was scheduled to be made pursuant to the Approved Annual FF&E Budget. If the actual expenditures made by Lender. Borrower for FF&E exceeds the lesser of (x) the Approved Annual FF&E Budget for such calendar quarter (provided such Approved Annual FF&E Budget is not less than four (4%) percent of the Gross Income from Operations for such quarter) or (b) four (4%) percent of the actual Gross Income from Operations for such quarter, Lender shall disburse reimburse Borrower for such excess to the extent that funds are available from the FF&E Reserve Account within fifteen (15) days from Borrower’s request. To the extent there are not sufficient funds in the FF&E Reserve Account to reimburse Borrower for any excess actual expenditures during such calendar quarter, such excess expenditures shall be added to the actual expenditures for the next calendar quarter in the determination of any amounts required to be deposited in the FF&E Reserve Account for such calendar quarter. In lieu of making any required deposits to the FF&E Reserve Account (other than the FF&E Reserve Deposit), Borrower may deliver to Lender a Letter of Credit in an amount equal to the amount that is required to be deposited into the FF&E Reserve Account. Such Letter of Credit shall constitute additional collateral for the Loan and Lender shall have the right to draw down upon such Letter of Credit and apply the proceeds thereof for purposes set forth in the Approved FF&E Budget if Borrower fails to do so within a reasonable time after notice from Lender, or Lender may apply such sums as otherwise provided in this Agreement following an Event of Default. All earnings or interest on the FF&E Reserve Funds upon satisfaction by Borrower of each of the following conditions: (i) Borrower shall submit a request for payment to Lender at least ten (10) days prior to the date on which Borrower requests such payment be made and specifies the FF&E to be paid; (ii) on the date such request is received by Lender and on the date such payment is to be made, no Event of Default shall exist and remain uncured, (iii) Lender shall have received a certificate from Borrower (A) stating that the items to be funded by the requested disbursement are FF&E, (B) stating that all FF&E at the Property to be funded by the requested disbursement have been installed in a good and workmanlike manner and in accordance with all applicable Legal Requirements, such certificate to be accompanied by a copy of any license, permit or other approval required by any Governmental Authority in connection with the FF&E, (C) identifying each Person that supplied materials or labor in connection with the FF&E to be funded by the requested disbursement and (D) stating that each such Person has been paid in full or will be paid in full upon such disbursement, such certificate to be accompanied by lien waivers, invoices and/or other evidence of payment satisfactory to Lender; (iv) at Lender’s option, if the disbursement amount exceeds $25,000, Lender shall have received a title search for the Property indicating that the Property is free from all liens, claims and other encumbrances other than Permitted Encumbrances; (v) at Lender’s option, if the disbursement exceeds $25,000, Lender shall have received a report satisfactory to Lender in its reasonable discretion from an architect or engineer approved by Lender in respect of such architect or engineer’s inspection of the applicable work; and (vi) Lender shall have received such other evidence as Lender shall reasonably request that the FF&E at the Property to be funded by the requested disbursement has, as applicable, been completed and are paid for or will be paid upon such disbursement to Borrower. Lender shall not be required to disburse FF&E Reserve Funds more frequently than once each calendar month nor in an amount less than the Minimum Disbursement Amount (or a lesser amount if the total amount of FF&E Reserve Funds is less than the Minimum Disbursement Amount, in which case only one disbursement of the amount remaining in the account shall be made). (c) Nothing in this Section 7.3 shall (i) make Lender responsible for any costs associated with any FF&E; (ii) require Lender to expend funds in addition to and become part of the FF&E Reserve Funds to pay for or complete, and shall be disbursed as applicable, any FF&E; (iii) obligate Lender to proceed with any FF&E work; or (iv) obligate Lender to demand from Borrower additional sums to pay for or complete, as applicable, any FF&E. (d) Borrower shall permit Lender and Lender’s agents and representatives (including, without limitation, Lender’s engineer, architect, or inspector) or third parties to enter onto the Property during normal business hours (subject to the rights of any Tenants under their Leases) to inspect the progress of any FF&E work and all materials being used in connection therewith and to examine all plans and shop drawings relating to such FF&E work. Borrower shall cause all contractors and subcontractors to cooperate with Lender or Lender’s representatives or such other Persons described above in connection with inspections described provided in this SectionSection 7.3.

Ffe Reserve Funds. (a) Beginning on the Monthly Payment Date occurring on December 9, 2019 and on each Monthly Payment Date thereafter, Borrower shall deposit into an Eligible Account held by with Lender or Servicer (on the “FF&E Reserve Account”) for FF&E costs, an amount equal to 1/12th of 4% Closing Date one-twelfth of the greater amount of (i) gross revenues for the Property in the preceding calendar year or (ii) the projected gross revenues for the Property for the current calendar year according to the most recently submitted Annual Approved FF&E Budget (the “FF&E Reserve Monthly Deposit”). The amount of the FF&E Reserve Deposit shall be recalculated annually during the term of the Loan, as of January 1 of each year (or as soon thereafter as Gross Income from Operations for the preceding year shall be determined to Lender’s reasonable satisfaction) such that the FF&E Reserve Deposit shall be equal to four (4%) percent of the prior year’s Gross Income from Operations divided by twelve (12). Amounts so deposited pursuant to this Section 7.3 are shall hereinafter be referred to herein as the Borrower’s “FF&E Reserve Funds”. Lender may reassess its estimate of ” and the amount necessary for account in which such amounts are held shall hereinafter be referred to as Borrower’s “FF&E costs from time to time, and may require Borrower to increase the monthly deposits required pursuant to this Section 7.3 upon Reserve Account.” Within thirty (30) days’ notice days following the end of each calendar quarter, Borrower shall provide to Lender a preliminary report with respect to the expenditures made by or on behalf of Borrower if Lender determines in its reasonable discretion with respect to the Property for FF&E during such calendar quarter. In the event that an increase the lesser of (a) the Approved Annual FF&E Budget for such calendar quarter (provided such Approved Annual FF&E Budget is necessary to maintain proper operation not less than four (4%) percent of the Property. Gross Income from Operations for such quarter) or (b) Lender four (4%) percent of the actual Gross Income from Operations for such quarter, exceeds the actual expenditures made by Borrower for FF&E for such quarter, Borrower shall disburse deposit an amount equal to any such difference in the FF&E Reserve Account to be held as FF&E Reserve Funds only to be disbursed pursuant to the provisions of this Section 7.3. Notwithstanding the foregoing, the amount of any such deposit required to be made by Borrower shall be reduced by the amount of any actual expenditure made by Borrower for costs associated with any FF&E reasonably approved completed prior to the calendar quarter in which such FF&E was scheduled to be made pursuant to the Approved Annual FF&E Budget. If the actual expenditures made by Lender. Borrower for FF&E exceeds the lesser of (x) the Approved Annual FF&E Budget for such calendar quarter (provided such Approved Annual FF&E Budget is not less than four (4%) percent of the Gross Income from Operations for such quarter) or (b) four (4%) percent of the actual Gross Income from Operations for such quarter, Lender shall disburse reimburse Borrower for such excess to the extent that funds are available from the FF&E Reserve Account within fifteen (15) days from Borrower’s request. To the extent there are not sufficient funds in the FF&E Reserve Account to reimburse Borrower for any excess actual expenditures during such calendar quarter, such excess expenditures shall be added to the actual expenditures for the next calendar quarter in the determination of any amounts required to be deposited in the FF&E Reserve Account for such calendar quarter. In lieu of making any required deposits to the FF&E Reserve Account (other than the FF&E Reserve Deposit), Borrower may deliver to Lender a Letter of Credit in an amount equal to the amount that is required to be deposited into the FF&E Reserve Account. Such Letter of Credit shall constitute additional collateral for the Loan and Lender shall have the right to draw down upon such Letter of Credit and apply the proceeds thereof for the purposes set forth in the Approved FF&E Budget if Borrower fails to do so within a reasonable time after notice from Lender, or Lender shall have the right to draw down upon such Letter of Credit and apply the proceeds thereof as otherwise provided in this Agreement following an Event of Default. All earnings or interest on the FF&E Reserve Funds upon satisfaction by Borrower of each of the following conditions: (i) Borrower shall submit a request for payment to Lender at least ten (10) days prior to the date on which Borrower requests such payment be made and specifies the FF&E to be paid; (ii) on the date such request is received by Lender and on the date such payment is to be made, no Event of Default shall exist and remain uncured, (iii) Lender shall have received a certificate from Borrower (A) stating that the items to be funded by the requested disbursement are FF&E, (B) stating that all FF&E at the Property to be funded by the requested disbursement have been installed in a good and workmanlike manner and in accordance with all applicable Legal Requirements, such certificate to be accompanied by a copy of any license, permit or other approval required by any Governmental Authority in connection with the FF&E, (C) identifying each Person that supplied materials or labor in connection with the FF&E to be funded by the requested disbursement and (D) stating that each such Person has been paid in full or will be paid in full upon such disbursement, such certificate to be accompanied by lien waivers, invoices and/or other evidence of payment satisfactory to Lender; (iv) at Lender’s option, if the disbursement amount exceeds $25,000, Lender shall have received a title search for the Property indicating that the Property is free from all liens, claims and other encumbrances other than Permitted Encumbrances; (v) at Lender’s option, if the disbursement exceeds $25,000, Lender shall have received a report satisfactory to Lender in its reasonable discretion from an architect or engineer approved by Lender in respect of such architect or engineer’s inspection of the applicable work; and (vi) Lender shall have received such other evidence as Lender shall reasonably request that the FF&E at the Property to be funded by the requested disbursement has, as applicable, been completed and are paid for or will be paid upon such disbursement to Borrower. Lender shall not be required to disburse FF&E Reserve Funds more frequently than once each calendar month nor in an amount less than the Minimum Disbursement Amount (or a lesser amount if the total amount of FF&E Reserve Funds is less than the Minimum Disbursement Amount, in which case only one disbursement of the amount remaining in the account shall be made). (c) Nothing in this Section 7.3 shall (i) make Lender responsible for any costs associated with any FF&E; (ii) require Lender to expend funds in addition to and become part of the FF&E Reserve Funds to pay for or complete, and shall be disbursed as applicable, any FF&E; (iii) obligate Lender to proceed with any FF&E work; or (iv) obligate Lender to demand from Borrower additional sums to pay for or complete, as applicable, any FF&E. (d) Borrower shall permit Lender and Lender’s agents and representatives (including, without limitation, Lender’s engineer, architect, or inspector) or third parties to enter onto the Property during normal business hours (subject to the rights of any Tenants under their Leases) to inspect the progress of any FF&E work and all materials being used in connection therewith and to examine all plans and shop drawings relating to such FF&E work. Borrower shall cause all contractors and subcontractors to cooperate with Lender or Lender’s representatives or such other Persons described above in connection with inspections described provided in this SectionSection 7.3.