Common use of Loan In Balance Clause in Contracts

Loan In Balance. As used herein, a “Shortfall” shall mean, as to any Line Item in the Development Budget as of any date, the amount determined by Lender, in Lender’s sole but reasonable judgment, by which (A) the cost of completing or satisfying such Line Item, exceeds (B) the remaining undisbursed portion of the Loan allocated to such Line Item in the Development Budget plus any sums deposited with Lender pursuant to this Section 2.1.10 to pay for such Line Item and not previously disbursed plus any Reserve Funds to the extent such Reserve Funds are available hereunder for the payment of such Line Item. From time to time and at any time during the Construction Period, Lender shall have the right, but not the obligation, to notify Borrower that it has determined a Shortfall exists as to any one or more Line Items. If Lender at any time shall so notify Borrower, Borrower shall, at its option within five (5) days of Lender’s notification as aforesaid, either: (i) deposit with Lender an amount equal to such Shortfall, which Lender disburse to Borrower to the satisfaction of the costs of such Line Item prior to advancing any further Loan proceeds on account of such costs; (ii) post an irrevocable standby Letter of Credit in the amount of such Shortfall, in favor of Lender; (iii) to the extent permitted under Sections 2.1.7 hereof and 5.1.33 of the Building Loan Agreement, and following the satisfaction of the Initial Advance Conditions allocate the Contingency Reserve, with respect to the Line Item(s) in question, to the Shortfall, and provided, further that the amount of the remaining Contingency Reserve for such Line Item(s) (following the allocation to the Shortfall) is sufficient for such Line Item(s), as determined by Lender in its sole discretion; and (iv) to the extent permitted under Section 5.1.33 of the Building Loan Agreement, and then only following the satisfaction of the Initial Advance Conditions, reallocate cost savings from the Development Budget in respect of the Loan (or other reallocations which are approved by Lender, in its sole discretion) in accordance with the terms of this Agreement, but only to the extent such cost savings can be allocated to the related Line Items. Borrower hereby agrees that Lender shall have a lien on and security interest in, for the benefit of Lender, any sums deposited pursuant to clause (i) above and that Borrower shall have no right to withdraw any such sums except for the payment of the aforesaid costs as approved by Lender. Lender shall have no obligation to make any further Advances of proceeds of the Loan as to any Line Item until the sums required to be deposited pursuant to clause (i) above as to such Line Item have been exhausted, or until Borrower has posted an irrevocable standby Letter of Credit pursuant to clause (iii) above, as the case may be, and, in any such case, the Loan is back “in balance”. Any such sums not used as provided in said clause (i) shall be released to Borrower when and to the extent that Lender reasonably determines that the amount thereof is more than the excess, if any, of the remaining Project-Related Costs over the undisbursed balance of the Loan, provided, however, that should an Event of Default occur, Lender, in its sole discretion, may apply such amounts either to the remaining Project-Related Costs or to the immediate reduction of outstanding principal and/or interest under the Note.

Loan In Balance. As used herein, a “Shortfall” shall mean, as to any Line Item in the Development Budget as of any date, the amount determined by Lender, in Lender’s sole but reasonable judgment, by which (A) the cost of completing or satisfying such Line Item, exceeds (B) the remaining undisbursed portion of the Loan allocated to such Line Item in the Development Budget plus any sums deposited with Lender pursuant to this Section 2.1.10 to pay for such Line Item and not previously disbursed plus any Reserve Funds to the extent such Reserve Funds are available hereunder for the payment of such Line Item. From time to time and at any time during the Construction Period, Lender shall have the right, but not the obligation, to notify Borrower that it has determined a Shortfall exists as to any one or more Line Items. If Lender at any time shall so notify Borrower, Borrower shall, at its option within five (5) days of Lender’s notification as aforesaid, either: (i) deposit with Lender an amount equal to such Shortfall, which Lender disburse to Borrower to the satisfaction of the costs of such Line Item prior to advancing any further Loan proceeds on account of such costs; (ii) post an irrevocable standby Letter of Credit in the amount of such Shortfall, in favor of Lender; (iii) to the extent permitted under Sections 2.1.7 hereof and 5.1.33 of the Building Loan Agreement5.1.33, and following the satisfaction of the Initial Advance Conditions allocate the Contingency Reserve, with respect to the Line Item(s) in question, to the Shortfall, and provided, further that the amount of the remaining Contingency Reserve for such Line Item(s) (following the allocation to the Shortfall) is sufficient for such Line Item(s), as determined by Lender in its sole discretion; and (iv) to the extent permitted under Section 5.1.33 of the Building Loan Agreement5.1.33, and then only following the satisfaction of the Initial Advance Conditions, reallocate cost savings from the Development Budget in respect of the Loan (or other reallocations which are approved by Lender, in its sole discretion) in accordance with the terms of this Agreement, but only to the extent such cost savings can be allocated to the related Line Items. Borrower hereby agrees that Lender shall have a lien on and security interest in, for the benefit of Lender, any sums deposited pursuant to clause (i) above and that Borrower shall have no right to withdraw any such sums except for the payment of the aforesaid costs as approved by Lender. Lender shall have no obligation to make any further Advances of proceeds of the Loan as to any Line Item until the sums required to be deposited pursuant to clause (i) above as to such Line Item have been exhausted, or until Borrower has posted an irrevocable standby Letter of Credit pursuant to clause (iii) above, as the case may be, and, in any such case, the Loan is back “in balance”. Any such sums not used as provided in said clause (i) shall be released to Borrower when and to the extent that Lender reasonably determines that the amount thereof is more than the excess, if any, of the remaining Project-Related Costs over the undisbursed balance of the Loan, provided, however, that should an Event of Default occur, Lender, in its sole discretion, may apply such amounts either to the remaining Project-Related Costs or to the immediate reduction of outstanding principal and/or interest under the Note.

Loan In Balance. As used hereinAgent and the Lenders shall not be obligated to make any advance of Loan proceeds unless and until Borrower has provided Agent with evidence, a “Shortfall” shall meanacceptable to Agent, that the Loan is in balance: i.e., that all remaining unpaid costs of the Property for the remaining period until the Maturity Date, as to any Line Item in the Development Budget as of any date, the amount determined by LenderAgent, in Lender’s its sole but reasonable judgmentdiscretion exercised in good faith, by which (A) including the cost Reserves, do not exceed the sum of completing or satisfying such Line Item, exceeds (B) the remaining undisbursed portion of the Loan allocated to such Line Item in the Development Budget plus any sums deposited with Lender pursuant to this Section 2.1.10 to pay for such Line Item and not previously disbursed plus any Reserve Funds to the extent such Reserve Funds are available hereunder for the payment of such Line Item. From time to time and at any time during the Construction Period, Lender shall have the right, but not the obligation, to notify Borrower that it has determined a Shortfall exists as to any one or more Line Items. If Lender at any time shall so notify Borrower, Borrower shall, at its option within five (5) days of Lender’s notification as aforesaid, either: (i) deposit with Lender an amount equal to such Shortfall, which Lender disburse to Borrower to the satisfaction of the costs of such Line Item prior to advancing any further Loan proceeds on account of such costs; (ii) post an irrevocable standby Letter of Credit in the amount of such Shortfall, in favor of Lender; (iii) to the extent permitted under Sections 2.1.7 hereof and 5.1.33 of the Building Loan Agreement, and following the satisfaction of the Initial Advance Conditions allocate the Contingency Reserve, with respect to the Line Item(s) in question, to the Shortfall, and provided, further that the amount of the Loan proceeds not yet advanced by the Lenders, the remaining Contingency Reserve for such Line Item(s) (following the allocation amount, if any, to the Shortfall) is sufficient for such Line Item(s), as determined by Lender in its sole discretion; and (iv) to the extent permitted under Section 5.1.33 of the Building Loan Agreement, and then only following the satisfaction of the Initial Advance Conditions, reallocate cost savings from the Development Budget be contributed in respect of the Loan (or other reallocations which are approved by LenderEquity Requirement, in its sole discretion) in accordance with and the terms of this Agreement, but only net operating income from the Property reasonably projected to the extent be received during such cost savings can be allocated to the related Line Itemsperiod. Borrower hereby agrees that Lender shall have a lien on and security interest in, for the benefit of Lender, any sums deposited pursuant to clause (i) above and that Borrower shall have no right to withdraw any such sums except for the payment The initial amount of the aforesaid Reserves has been designated in the Sworn Construction Cost Statement. The required amount of said Reserves shall decline as costs as approved by Lender. Lender shall have no obligation to make any further Advances of proceeds of the Loan as to any Line Item until the sums required to be deposited pursuant to clause (i) above as to such Line Item have been exhausted, or until Borrower has posted an irrevocable standby Letter of Credit pursuant to clause (iii) above, as the case may be, and, in any such case, the Loan is back “in balance”. Any such sums not used as provided in said clause (i) shall be released to Borrower when and to the extent that Lender reasonably determines that the amount thereof is more than the excess, if any, of the remaining Project-Related Costs over the undisbursed balance of the Loan, payments for which they are maintained are paid therefrom; provided, however, that should the amount of any such Reserves shall never decline below an Event amount sufficient to pay all costs and payments for which it is maintained which then remain unpaid, as determined by Agent. If the Reserves become depleted, such depletion shall not limit Borrower’s obligation hereunder to pay all sums which otherwise would have been payable from such Reserves. Notwithstanding any provision of Default occur, Lenderthis Agreement to the contrary, in its sole discretionthe event that Agent or Borrower determines in good faith that the Loan is not in balance, may apply it shall notify the other party hereto of such amounts either determination, and Borrower shall, within ten (10) Business Days, deposit with Agent funds equal to said insufficiency in order to bring the remaining Project-Related Costs Loan back into balance. Said funds shall be disbursed by Agent pursuant to and in accordance with the disbursement procedures set forth in this Agreement prior to any advances by Agent or to the immediate reduction Lenders of outstanding principal and/or interest under the Noteadditional Loan proceeds.

Loan In Balance. As used hereinAnything in this Agreement contained to the contrary notwithstanding, a “Shortfall” shall mean, as to any Line Item it is expressly understood and agreed that in the Development Administrative Agent’s reasonable discretion the Loan shall at all times be “In Balance” on a line-by-line and an aggregate basis. Each line item in the Budget as of any date, shall be deemed to be “In Balance” only when the amount determined by Lender, in Lender’s sole but reasonable judgment, by which (A) the cost of completing or satisfying such Line Item, exceeds (B) the remaining undisbursed portion of the then-current line item equals or exceeds the costs required to complete all elements of the construction of the Subject Property intended to be covered by such line item. The Loan allocated shall be deemed to such Line Item be “In Balance” in the Development Budget plus any sums deposited aggregate only when the total of the undisbursed portion of the then-current Maximum Loan Amount less the Contingency Fund (subject to Borrower’s reallocation rights under Sections 8.2 and 8.3), equals or exceeds the aggregate of (a) the costs required to complete the construction of the Subject Property in accordance with Lender pursuant the Plans and Specifications and the Budget, including, without limitation, all Tenant Work required to this Section 2.1.10 be performed by Borrower or tenant allowances to be paid for by Borrower under Leases or reasonably anticipated for unleased space; (b) the amounts to be paid as retainages to persons who have supplied labor or materials to the Subject Property; (c) the amount in excess of projected Net Operating Income required to pay interest on the Loan through the Maturity Date; and (d) all other hard and soft costs not yet paid for such Line Item in connection with the Subject Property. Such costs and not previously disbursed plus any Reserve Funds to amounts described in clauses (a), (b), (c) and (d) may be estimated and/or approved in writing by the extent such Reserve Funds are available hereunder for the payment of such Line Item. From Administrative Agent from time to time and at time. Borrower agrees that if for any time during reason, in the Construction PeriodAdministrative Agent’s reasonable discretion, Lender shall have the right, but not the obligation, to notify Borrower that it has determined a Shortfall exists as to any one or more Line Items. If Lender at any time shall so notify Borrower, Borrower shall, at its option within five (5) days of Lender’s notification as aforesaid, either: (i) deposit with Lender an amount equal to such Shortfall, which Lender disburse to Borrower to the satisfaction of the costs of such Line Item prior to advancing any further Loan proceeds on account of such costs; (ii) post an irrevocable standby Letter of Credit in the amount of such Shortfall, in favor of Lender; (iii) to the extent permitted under Sections 2.1.7 hereof and 5.1.33 of the Building undistributed Loan Agreement, and following the satisfaction of the Initial Advance Conditions allocate the Contingency Reserve, with respect to the Line Item(s) in question, to the Shortfall, and provided, further that the amount of the remaining Contingency Reserve proceeds shall at any time be or become insufficient for such Line Item(spurpose regardless of how such condition may be caused, Borrower will, within ten (10) (following days after written request by the allocation to Administrative Agent, deposit the Shortfall) is sufficient for such Line Item(s), as determined by Lender in its sole discretion; and (iv) to the extent permitted under Section 5.1.33 of the Building Loan Agreement, and then only following the satisfaction of the Initial Advance Conditions, reallocate cost savings from the Development Budget in respect of the Loan (or other reallocations which are approved by Lender, in its sole discretion) in accordance deficiency with the terms Administrative Agent (“Deficiency Deposit”). The Deficiency Deposit shall first be exhausted before any further disbursement of this Agreement, but only to the extent such cost savings can Loan proceeds shall be allocated to the related Line Itemsmade. Borrower hereby agrees that Lender Lenders shall have a lien on and security interest in, for the benefit of Lender, any sums deposited pursuant to clause (i) above and that Borrower shall have no right to withdraw any such sums except for the payment of the aforesaid costs as approved by Lender. Lender shall have no obligation not be obligated to make any further Advances of proceeds of the Loan disbursements if and for as to any Line Item until the sums required to be deposited pursuant to clause (i) above long as to such Line Item have been exhausted, or until Borrower has posted an irrevocable standby Letter of Credit pursuant to clause (iii) above, as the case may be, and, in any such case, the Loan is back not “in balanceIn Balance”. Any Notwithstanding anything contained herein to the contrary, if, as a result of any subsequent events, such sums not used as provided Deficiency Deposit is no longer needed in said clause (i) shall order for the Loan to be released to Borrower when and “In Balance”, then to the extent that Lender reasonably determines that the amount thereof is more than the excessany portion of such Deficiency Deposit has not otherwise been applied to Project Costs, if any, of the remaining Project-Related Costs over the undisbursed balance of the Loan, provided, however, that should an Event of Default occur, Lender, in its sole discretion, may apply such amounts either Deficiency Deposit funds held by Administrative Agent shall be returned to the remaining Project-Related Costs or to the immediate reduction of outstanding principal and/or interest under the NoteBorrower.

Loan In Balance. As used hereinAnything contained in this Agreement to the contrary notwithstanding, it is expressly understood and agreed that in Agent’s reasonable discretion the Loan shall at all times be “In Balance”, on a “Shortfall” shall mean, as to any Budget Line Item and an aggregate basis. A Budget Line Item shall be deemed to be “In Balance” only if Agent in its reasonable discretion determines that the amount of such Budget Line Item is sufficient for its intended purpose. The Loan shall be deemed to be “In Balance” in the Development Budget as aggregate only when the total of any date, the amount determined by Lender, in Lender’s sole but reasonable judgment, by which (A) the cost of completing or satisfying such Line Item, exceeds (B) the remaining undisbursed portion of the Loan allocated less the Contingency Fund (subject to such Line Item Borrower’s reallocation rights under Section 10.3), equals or exceeds the aggregate of (a) the costs required to complete the construction of the Project in accordance with the Development Budget plus any sums deposited with Lender pursuant Plans and Specifications and the Budget; (b) the amounts to this Section 2.1.10 be paid as retainages to persons who have supplied labor or materials to the Project; (c) the amount in excess of the projected Net Operating Income required to pay interest on the Loan through the Maturity Date; and (d) all other hard and soft costs not yet paid for in connection with the Project, as such Line Item costs and not previously disbursed plus any Reserve Funds to the extent such Reserve Funds are available hereunder for the payment of such Line Item. From amounts described in clauses (a), (b), (c) and (d) may be estimated and/or approved in writing by Agent from time to time and at time. Borrower agrees that if for any time during the Construction Periodreason, Lender shall have the rightin Agent’s reasonable discretion, but not the obligation, to notify Borrower that it has determined a Shortfall exists as to any one or more Line Items. If Lender at any time shall so notify Borrower, Borrower shall, at its option within five (5) days of Lender’s notification as aforesaid, either: (i) deposit with Lender an amount equal to such Shortfall, which Lender disburse to Borrower to the satisfaction of the costs of such Line Item prior to advancing any further Loan proceeds on account of such costs; (ii) post an irrevocable standby Letter of Credit in the amount of such Shortfall, in favor of Lender; (iii) to the extent permitted under Sections 2.1.7 hereof and 5.1.33 of the Building undistributed Loan Agreement, and following the satisfaction of the Initial Advance Conditions allocate the Contingency Reserve, with respect to the Line Item(s) in question, to the Shortfall, and provided, further that the amount of the remaining Contingency Reserve proceeds shall at any time be or become insufficient for such Line Item(spurpose regardless of how such condition may be caused, Borrower will, within ten (10) days after written request by Agent, deposit the deficiency with Agent (following the allocation to the Shortfall) is sufficient for such Line Item(s“Deficiency Deposit”), as determined by Lender in its sole discretion; and (iv) to the extent permitted under Section 5.1.33 . The Deficiency Deposit shall first be exhausted before any further disbursement of the Building Loan Agreement, and then only following the satisfaction of the Initial Advance Conditions, reallocate cost savings from the Development Budget in respect of the Loan (or other reallocations which are approved by Lender, in its sole discretion) in accordance with the terms of this Agreement, but only to the extent such cost savings can proceeds shall be allocated to the related Line Items. Borrower hereby agrees that Lender shall have a lien on and security interest in, for the benefit of Lender, any sums deposited pursuant to clause (i) above and that Borrower shall have no right to withdraw any such sums except for the payment of the aforesaid costs as approved by Lendermade. Lender shall have no obligation not be obligated to make any further Advances of proceeds of the Loan disbursements if and for as to any Line Item until the sums required to be deposited pursuant to clause (i) above long as to such Line Item have been exhausted, or until Borrower has posted an irrevocable standby Letter of Credit pursuant to clause (iii) above, as the case may be, and, in any such case, the Loan is back not “in balanceIn Balance”. Any such sums not used as provided in said clause (i) shall be released to Borrower when and to the extent that Lender reasonably determines that the amount thereof is more than the excess, if any, of the remaining Project-Related Costs over the undisbursed balance of the Loan, provided, however, that should an Event of Default occur, Lender, in its sole discretion, may apply such amounts either to the remaining Project-Related Costs or to the immediate reduction of outstanding principal and/or interest under the Note.

Loan In Balance. As used herein(a) At all times prior to repayment of the Loan in full, a “Shortfall” shall mean, as (i) the sum of (A) the undisbursed proceeds from the Loan (net of any unpaid accrued interest on the Loan) allocated to any Line Item each line item in the Development Budget (including any reserve specifically set aside for such line item) plus (B) the aggregate amount of all amounts deposited by Borrower pursuant to Section 5.8(c) (the aggregate amount of such proceeds being hereinafter referred to as of any date, the amount determined by Lender“Available Proceeds”) must be sufficient, in Lender’s sole but reasonable judgmentand absolute determination, by which to pay the unpaid costs and expenses that will be incurred to complete such item, and (Aii) the cost aggregate Available Proceeds must be sufficient, in Lender’s reasonable determination, to pay all Project Costs remaining unpaid and all operating, management and other expenses of completing or satisfying such Line Item, exceeds the Project. (Bb) If Lender determines that (i) the costs and expenses to complete any line item in the Budget exceeds the Available Proceeds allocated therefor, or (ii) the Project Costs remaining undisbursed unpaid and all estimated operating, management and other expenses of the Project, exceed the sum of the Available Proceeds, then the Loan shall be deemed “out of balance” to the extent of such excess. (c) If Lender deems the Loan to be out of balance as aforesaid, Borrower shall, within ten (10) days after written request by Lender, deposit into an account maintained at Lender (and pledged to Lender as additional security for the Loan) an amount equal to the excess amount or amounts determined pursuant to subparagraphs (a) and (b) above of this Section 5.8 (the “Balancing Deposit”‘) The sums thus deposited with Lender will be disbursed by Lender to complete the Work prior to any further disbursement of Loan proceeds. If such deposit is not made within such time, an Event of Default shall be deemed to have occurred. No interest shall be payable to Borrower on the amounts so deposited pursuant to this subparagraph. Anything to the contrary contained in this Section 5.8 notwithstanding, in the event that Borrower is required to deposit the Balancing Deposit and the Project is thereafter completed with subsequent savings that, had said savings occurred prior to the requirement of the Balancing Deposit, would have rendered all or a portion of the Balancing Deposit to be unnecessary, Borrower shall be entitled to a reimbursement from Lender equal to the lesser of (a) the amount of such subsequent savings, and (b) the amount of the Balancing Deposit. (d) Lender shall not be required to disburse any portion of the Loan allocated to such Line Item in the Development Budget plus any sums deposited with Lender pursuant to this Section 2.1.10 to pay for such Line Item and not previously disbursed plus any Reserve Funds to the extent such Reserve Funds are available hereunder for the payment of such Line Item. From time to time and at any time during the Construction Period, Lender shall have the right, but not the obligation, to notify Borrower that it has determined a Shortfall exists as to any one or more Line Items. If Lender at any time shall so notify Borrower, Borrower shall, at its option within five (5) days of Lender’s notification as aforesaid, either: (i) deposit with Lender an amount equal to such Shortfall, which Lender disburse to Borrower to the satisfaction of the costs of such Line Item prior to advancing any further Loan proceeds on account of such costs; (ii) post an irrevocable standby Letter of Credit in the amount of such Shortfall, in favor of Lender; (iii) to the extent permitted under Sections 2.1.7 hereof and 5.1.33 of the Building Loan Agreement, and following the satisfaction of the Initial Advance Conditions allocate the Contingency Reserve, with respect to the Line Item(s) in question, to the Shortfall, and provided, further that the amount of the remaining Contingency Reserve for such Line Item(s) (following the allocation to the Shortfall) is sufficient for such Line Item(s), as determined by Lender in its sole discretion; and (iv) to the extent permitted under Section 5.1.33 of the Building Loan Agreement, and then only following the satisfaction of the Initial Advance Conditions, reallocate cost savings from the Development Budget in respect of the Loan (or other reallocations which are approved by Lender, in its sole discretion) in accordance with the terms of this Agreement, but only to the extent such cost savings can be allocated to the related Line Items. Borrower hereby agrees that Lender shall have a lien on and security interest in, for the benefit of Lender, any sums deposited pursuant to clause (i) above and that Borrower shall have no right to withdraw any such sums except for the payment of the aforesaid costs as approved by Lender. Lender shall have no obligation to make any further Advances of proceeds of the Loan as to any Line Item until the sums required to be deposited pursuant to clause (i) above as to such Line Item have been exhausted, or until Borrower has posted an irrevocable standby Letter of Credit pursuant to clause (iii) above, as the case may be, and, in any such case, the Loan is back “in out of balance” or if the requested disbursement would cause the Loan to be “out of balance.”. Any such sums not used as provided in said clause (i) shall be released to Borrower when and to the extent that Lender reasonably determines that the amount thereof is more than the excess, if any, of the remaining Project-Related Costs over the undisbursed balance of the Loan, provided, however, that should an Event of Default occur, Lender, in its sole discretion, may apply such amounts either to the remaining Project-Related Costs or to the immediate reduction of outstanding principal and/or interest under the Note.

Loan In Balance. As used hereinLender shall not be obligated to make any Advance of Loan proceeds unless and until Borrower has provided Lender with evidence, a “Shortfall” shall meanacceptable to Lender, that the Loan is in Balance, i.e. (a) the undisbursed portion of Loan proceeds allocated to each line item in the Budget, as amended from time to time, is sufficient to complete each such line item, and (b) the then undisturbed portion of the Loan, less an amount equal to the Contingency Reserve, equals or exceeds the amount necessary to pay for all work done and not previously paid for or to be done in connection with the completion of the improvements substantially in accordance with the Plans. The initial amounts of the Reserves have been designated in this Agreement. The required amounts of said Reserves shall decline as costs and payments for which they are maintained are paid therefrom; provided, however, that the amount of any Line Item such Reserve shall never decline below an amount sufficient to pay all costs and payments for which it is maintained which then remain unpaid, as determined by Lender. If any Reserve becomes depleted, such depletion shall not limit Borrower’s obligation hereunder to pay all sums which otherwise would have been payable from such Reserve. Notwithstanding any provision of this Agreement or of the Disbursing Agreement to the contrary, in the Development Budget event that Lender or Borrower determines that the unadvanced balance of Loan proceeds is insufficient to cover any cost allocation set forth on the Sworn Construction Cost Statement, or to fully fund the Reserves, and/or to complete the Project and to pay all costs and expenses of Completion and, combined with Project income, to pay all costs to operate the Project, to pay interest on the Loan, through the Maturity Date, and pay Total Project Costs, all as of any date, the amount reasonably determined by Lender, in Lender’s sole but reasonable judgment, by which (A) it shall notify the cost of completing or satisfying such Line Item, exceeds (B) the remaining undisbursed portion of the Loan allocated to such Line Item in the Development Budget plus any sums deposited with Lender pursuant to this Section 2.1.10 to pay for such Line Item and not previously disbursed plus any Reserve Funds to the extent such Reserve Funds are available hereunder for the payment other party hereto of such Line Item. From time to time determination, and at any time during the Construction Period, Lender shall have the right, but not the obligation, to notify Borrower that it has determined a Shortfall exists as to any one or more Line Items. If Lender at any time shall so notify Borrower, Borrower shall, at its option within five (5) days of Lender’s notification as aforesaidBusiness Days, either: (i) deposit with Lender an amount (or, if requested by Lender, the Title Company) funds equal to such Shortfall, which Lender disburse said insufficiency in order to Borrower bring the Loan back into Balance. Anything to the satisfaction contrary contained in this Section 3.3 notwithstanding, in the event that Borrower is required to deposit balancing funds with Lender hereunder and the Project is thereafter completed with subsequent savings that, had they occurred prior to the requirement of the costs balancing funds, would have rendered all or a portion of such Line Item prior deposit to advancing any further Loan proceeds on account be unnecessary, Borrower shall be entitled to a reimbursement of such costs; the funds deposited equal to the lesser of (iia) post an irrevocable standby Letter of Credit in the amount of such Shortfall, in favor of Lender; subsequent savings or (iiib) to the extent permitted under Sections 2.1.7 hereof and 5.1.33 of the Building Loan Agreement, and following the satisfaction of the Initial Advance Conditions allocate the Contingency Reserve, with respect to the Line Item(s) in question, to the Shortfall, and provided, further that the amount of the remaining Contingency Reserve for such Line Item(s) (following balancing funds deposit. In the allocation event that Borrower generates cash through contributions to the Shortfall) is sufficient for such Line Item(s)capital of Borrower, or through sale of any of the Land with the consent of the Lender (as determined by Lender in its sole discretion; and (iv) to the extent permitted required under Section 5.1.33 of the Building Loan Agreement, and then only following the satisfaction of the Initial Advance Conditions, reallocate cost savings from the Development Budget in respect of the Loan (or other reallocations which are approved by Lender, in its sole discretion) in accordance with the terms 5.12 of this Agreement), but only to the extent such cost savings can be allocated to the related Line Items. Borrower hereby agrees that Lender shall have a lien on and security interest in, for the benefit of Lender, any sums deposited pursuant to clause (i) above and that Borrower shall have no right to withdraw any such sums except for the payment of the aforesaid costs as approved by Lender. Lender shall have no obligation to make any further Advances of proceeds of the Loan as to any Line Item until the sums required to be deposited pursuant to clause (i) above as to such Line Item have been exhausted, or until Borrower has posted an irrevocable standby Letter of Credit pursuant to clause (iii) above, as the case may be, and, in any such case, the Loan is back “in balance”. Any such sums not used as provided in said clause (i) cash shall be released used, at the Lender’s option, to Borrower when and to reduce the extent that Lender reasonably determines that the amount thereof is more than the excess, if any, of the remaining Project-Related Costs over the undisbursed balance of the Loan, provided, however, that should an Event of Default occur, Lender, in its sole discretion, may apply such amounts either to the remaining Project-Related Costs or to the immediate reduction of outstanding principal and/or interest Principal Balance owing under the Note.

Loan In Balance. As used herein, a “Shortfall” shall mean, as to any Line Item in the Development Budget as of any date, the amount determined by Lender, in Lender’s sole but reasonable judgment, by which (A) the cost of completing or satisfying such Line Item, exceeds (B) the remaining undisbursed portion of the Loan allocated to such Line Item in the Development Budget plus any sums deposited with Lender pursuant to this Section 2.1.10 to pay for such Line Item and not previously disbursed plus any Reserve Funds to the extent such Reserve Funds are available hereunder for the payment of such Line Item. From time to time and at any time during the Construction Period, Lender shall have the right, but not the obligation, to notify Borrower that it has determined a Shortfall exists as to any one or more Line Items. If Lender at any time shall so notify Borrower, Borrower shall, at its option within five (5) days of Lender’s notification as aforesaid, either: (i) deposit with Lender an amount equal to such Shortfall, which Lender disburse to Borrower to the satisfaction of the costs of such Line Item prior to advancing any further Loan proceeds on account of such costs; (ii) post an irrevocable standby Letter of Credit in the amount of such Shortfall, in favor of Lender; (iii) to the extent permitted under Sections 2.1.7 hereof and 5.1.33 of the Building Loan Agreement, and following the satisfaction of the Initial Advance Conditions allocate the Contingency Reserve, with respect to the Line Item(s) in question, to the Shortfall, and provided, further that the amount of the remaining Contingency Reserve for such Line Item(s) (following the 8 allocation to the Shortfall) is sufficient for such Line Item(s), as determined by Lender in its sole discretion; and (iv) to the extent permitted under Section 5.1.33 of the Building Loan Agreement, and then only following the satisfaction of the Initial Advance Conditions, reallocate cost savings from the Development Budget in respect of the Loan (or other reallocations which are approved by Lender, in its sole discretion) in accordance with the terms of this Agreement, but only to the extent such cost savings can be allocated to the related Line Items. Borrower hereby agrees that Lender shall have a lien on and security interest in, for the benefit of Lender, any sums deposited pursuant to clause (i) above and that Borrower shall have no right to withdraw any such sums except for the payment of the aforesaid costs as approved by Lender. Lender shall have no obligation to make any further Advances of proceeds of the Loan as to any Line Item until the sums required to be deposited pursuant to clause (i) above as to such Line Item have been exhausted, or until Borrower has posted an irrevocable standby Letter of Credit pursuant to clause (iii) above, as the case may be, and, in any such case, the Loan is back “in balance”. Any such sums not used as provided in said clause (i) shall be released to Borrower when and to the extent that Lender reasonably determines that the amount thereof is more than the excess, if any, of the remaining Project-Related Costs over the undisbursed balance of the Loan, provided, however, that should an Event of Default occur, Lender, in its sole discretion, may apply such amounts either to the remaining Project-Related Costs or to the immediate reduction of outstanding principal and/or interest under the Note.

Loan In Balance. As used hereinBanks shall not be obligated to make any Advance on the Real Estate Loan proceeds unless and until X.Xxx has provided Administrative Bank with evidence reasonably acceptable to Administrative Bank that the Real Estate Loan is “In Balance”. For purposes of this Agreement, the term “In Balance” means that (a) X.Xxx has paid, in cash, costs of the Project shown in the Budget, equal to at least the amount of item (i) under X.Xxx’s Equity (not including any payments to a “Shortfall” shall mean, Related Party that Administrative Bank does not permit to be included as a portion of X.Xxx’s Equity); (b) as to any Line Item line item in the Development Budget Budget, all remaining unpaid costs of completing such line item, as of any datedetermined by Administrative Bank , do not exceed the amount determined by Lender, in Lender’s sole but reasonable judgment, by which (A) the cost of completing or satisfying such Line Item, exceeds (B) the remaining undisbursed portion of the Real Estate Loan proceeds allocated to such Line Item line item, as reflected in the Development Budget Budget, and not yet advanced by Banks (plus any sums deposited with Lender pursuant to this Section 2.1.10 to pay for such Line Item and not previously disbursed plus any Reserve Funds unused contingency amount in the Budget that may be applied by X.Xxx at its discretion); (c) as to the extent such Reserve Funds are available hereunder for Project, all remaining unpaid cost of construction of the payment Project, as reasonably determined by Administrative Bank do not exceed the amount of the Real Estate Loan proceeds not yet advanced by Banks plus item (ii) under X.Xxx’s Equity; and (d) X.Xxx is in compliance with the Loan to Value Requirement as established by the most recent Bank Approved Appraisal required by this Agreement. Notwithstanding any provision of this Agreement to the contrary, in the event that Administrative Bank or X.Xxx reasonably determines that the unadvanced balance of the Real Estate Loan proceeds plus item (ii) in X.Xxx’s Equity is insufficient to (i) cover any cost allocation set forth on the Budget, and (ii) pay all costs and expenses of Completion, it shall notify the other parties hereto of such Line Item. From time to time determination, and at any time during the Construction Period, Lender shall have the right, but not the obligation, to notify Borrower that it has determined a Shortfall exists as to any one or more Line Items. If Lender at any time shall so notify Borrower, Borrower X.Xxx shall, at its option within five (5) days Business Days following demand made to X.Xxx, deposit with Administrative Bank funds equal to said insufficiency in order to bring the Real Estate Loan back In Balance. In addition, in the event there is an increase in any cost category line item of Lender’s notification as aforesaidthe Budget, either: that is not to be funded through a re-allocation of the amounts set forth in the Budget that is permitted hereby, X.Xxx shall, within five (5) Business Days following demand made to X.Xxx, deposit with Administrative Bank funds in an amount necessary to bring said line item back “In Balance.” All sums so deposited shall be advanced by Administrative Bank to pay costs of the Project in the same manner as, and prior to, further Advances on the Real Estate Loan proceeds hereunder. In the event that (i) deposit with Lender an amount equal funds are deposited by X.Xxx pursuant to such Shortfallthis Section 3.5, which Lender disburse to Borrower to the satisfaction of the costs of such Line Item prior to advancing any further Loan proceeds on account of such costs; (ii) post an irrevocable standby Letter those funds are used to achieve Completion, and (iii) not all of Credit the Real Estate Commitment is advanced to achieve Completion, X.Xxx may request in writing a final Advance on the Real Estate Loan prior to Conversion in the amount of such Shortfall, in favor the lesser of Lender; (iiix) all amounts deposited pursuant to this Section 3.5 and used to achieve Completion and (y) the extent permitted under Sections 2.1.7 hereof and 5.1.33 of the Building Loan Agreement, and following the satisfaction of the Initial Advance Conditions allocate the Contingency Reserve, with respect to the Line Item(s) in question, to the Shortfall, and provided, further that the remaining undisbursed amount of the remaining Contingency Reserve Real Estate Loan. Notwithstanding anything to the contrary herein or in any other Loan Document, such amounts may be distributed by X.Xxx to Overstock if the requirements for such Line Item(s) (following the allocation to the Shortfall) is sufficient for such Line Item(s), as determined by Lender in its sole discretion; and (iv) to the extent permitted a distribution under Section 5.1.33 of 5.22 are met. The Administrative Bank agrees to provide to X.Xxx on request, the Building Loan Agreement, and then only following calculations used by the satisfaction of the Initial Advance Conditions, reallocate cost savings from the Development Budget in respect of the Loan (or other reallocations which are approved by Lender, in its sole discretion) in accordance with the terms of this Agreement, but only to the extent such cost savings can be allocated to the related Line Items. Borrower hereby agrees that Lender shall have a lien on and security interest in, for the benefit of Lender, any sums deposited pursuant to clause (i) above and that Borrower shall have no right to withdraw any such sums except for the payment of the aforesaid costs as approved by Lender. Lender shall have no obligation to make any further Advances of proceeds of the Loan as to any Line Item until the sums required to be deposited pursuant to clause (i) above as to such Line Item have been exhausted, or until Borrower has posted an irrevocable standby Letter of Credit pursuant to clause (iii) above, as the case may be, and, Administrative Bank in any such case, determination that the Real Estate Loan is back not “in balanceIn Balance.”. Any such sums not used as provided in said clause (i) shall be released to Borrower when and to the extent that Lender reasonably determines that the amount thereof is more than the excess, if any, of the remaining Project-Related Costs over the undisbursed balance of the Loan, provided, however, that should an Event of Default occur, Lender, in its sole discretion, may apply such amounts either to the remaining Project-Related Costs or to the immediate reduction of outstanding principal and/or interest under the Note.

Loan In Balance. As used hereinAnything contained in this Agreement to the contrary notwithstanding, the Loan shall at all times be “In Balance”, on a “Shortfall” shall mean, as to any Budget Line Item basis and in the Development aggregate. A Budget as of any date, the amount determined by Line Item shall be deemed to be “In Balance” only if Lender, in Lender’s sole but its reasonable judgmentdiscretion, by which (A) determines that the cost amount of completing or satisfying such Budget Line Item, exceeds (B) Item is sufficient for its intended purpose. The Loan shall be deemed to be “In Balance” in the remaining aggregate only when the total of the undisbursed portion of the Loan allocated to plus the undisbursed balance of Available Contract Deposits, less the Contingency Reserve (such Line Item in total being the Development Budget plus any sums deposited with Lender pursuant to this Section 2.1.10 to pay for such Line Item and not previously disbursed plus any Reserve Funds to “Available Funds”), equals or exceeds the extent such Reserve Funds are available hereunder for the payment of such Line Item. From time to time and at any time during the Construction Period, Lender shall have the right, but not the obligation, to notify Borrower that it has determined a Shortfall exists as to any one or more Line Items. If Lender at any time shall so notify Borrower, Borrower shall, at its option within five (5) days of Lender’s notification as aforesaid, eitheraggregate of: (i) deposit with Lender an amount equal to such Shortfall, which Lender disburse to Borrower to the satisfaction of the costs of such Line Item prior required to advancing any further Loan proceeds on account of such costscomplete the Construction in accordance with the Plans and Specifications and the Construction Budget; (ii) post an irrevocable standby Letter of Credit in the amount of such Shortfall, in favor of Lenderamounts to be paid as retainages to persons who have supplied labor or materials to the Project; (iii) the amount required to pay interest on the extent permitted Loan through the Maturity Date; (iv) amounts required to be refunded or otherwise paid to any contract vendee under Sections 2.1.7 hereof a Contract of Sale; and 5.1.33 of (v) all other Hard Costs and Soft Costs not yet paid for in connection with the Building Project, as such costs and amounts described in clauses (i) through (v) above may be estimated and/or approved in writing by Lender from time to time (such costs and amounts in (i) through (v) being the “Outstanding Loan AgreementCosts”). If, and following in Lender’s reasonable determination, either any Budget Line Item is insufficient for such purpose or the satisfaction of the Initial Advance Conditions allocate the Contingency Reserve, with respect to the Line Item(s) in question, to the Shortfall, and provided, further that the aggregate amount of the remaining Contingency Reserve for such Line Item(sAvailable Funds is less than Outstanding Loan Costs, then Borrower shall, within fifteen (15) (following the allocation to the Shortfall) is sufficient for such Line Item(s), as determined by Lender in its sole discretion; and (iv) to the extent permitted under Section 5.1.33 of the Building Loan Agreement, and then only following the satisfaction of the Initial Advance Conditions, reallocate cost savings from the Development Budget in respect of the Loan (or other reallocations which are approved days after written request by Lender, in its sole discretion) in accordance (with simultaneous copies of such written request sent to Guarantors), deposit the terms of this Agreement, but only to the extent such cost savings can deficiency with Lender (a “Deficiency Deposit”). The Deficiency Deposit shall first be allocated to the related Line Items. Borrower hereby agrees that Lender shall have a lien on and security interest in, for the benefit of Lender, exhausted before any sums deposited pursuant to clause (i) above and that Borrower shall have no right to withdraw any such sums except for the payment further disbursement of the aforesaid costs as approved by Lenderapplicable Loan proceeds shall be made. Lender shall have no obligation to make any further Advances of proceeds of the Loan as to any Any Deficiency Deposit remaining after a particular Budget Line Item until or the sums required to be deposited pursuant to clause (i) above as to such Line Item have been exhausted, or until Borrower has posted an irrevocable standby Letter of Credit pursuant to clause (iii) aboveLoan, as the case may be, and, in is back “In Balance” shall be returned to Borrower. Lender shall not be obligated to make any such case, Loan disbursements if and for as long as the Loan is back not “in balanceIn Balance”. Any such sums not used as provided in said clause (i) shall be released to Borrower when and Notwithstanding anything contained herein to the extent that contrary, Lender reasonably determines that will forbear from requiring collection of any Deficiency Deposit until the amount thereof earlier of (a) February 11, 2007 or (b) the date the Public Report is filed and one or more than the excess, if any, of the remaining Project-Related Costs over the undisbursed balance of the Loan, provided, however, that should an Event of Default occur, Lender, in its sole discretion, may apply such amounts either to the remaining Project-Related Costs or to the immediate reduction of outstanding principal and/or interest under the NoteContract Deposits become Available Contract Deposits.

Loan In Balance. As used herein, a “Shortfall” shall mean, as to any Line Item in the Development Budget as of any date, the amount determined by Lender, in Lender’s sole but reasonable judgment, by which (A) the cost of completing or satisfying such Line Item, exceeds (B) the remaining undisbursed portion of the Loan allocated to such Line Item in the Development Budget plus any sums deposited with Lender pursuant to this Section 2.1.10 to pay for such Line Item and not previously disbursed plus any Reserve Funds to the extent such Reserve Funds are available hereunder for the payment of such Line Item. From time to time and at any time during the Construction Period, Lender shall have the right, but not the obligation, to notify Borrower that it has determined a Shortfall exists as to any one or more Line Items. If Lender at any time shall so notify Borrower, Borrower shall, at its option within five (5) days of Lender’s notification as aforesaid, either: (i) deposit with Lender an amount equal to such Shortfall, which Lender disburse to Borrower to the satisfaction of the costs of such Line Item prior to advancing any further Loan proceeds on account of such costs; (ii) post an irrevocable standby Letter of Credit in the amount of such Shortfall, in favor of Lender; (iii) to the extent permitted under Sections 2.1.7 hereof and 5.1.33 of the Building Loan Agreement5.1.33, and following the satisfaction of the Initial Advance Conditions allocate the Contingency Reserve, with respect to the Line Item(s) in question, to the Shortfall, and provided, further that the amount of the remaining Contingency Reserve for such Line Item(s) (following the allocation to the Shortfall) is sufficient for such Line Item(s), as determined by Lender in its sole discretion; and (iv) to the extent permitted under Section 5.1.33 of the Building Loan Agreement5.1.33, and then only following the satisfaction of the Initial Advance Conditions, reallocate cost savings from the Development Budget in respect of the Loan (or other reallocations which are approved by Lender, in its sole discretion) in accordance with the terms of this Agreement, but only to the extent such cost savings can be allocated to the related Line Items. Borrower hereby agrees that Lender shall have a lien on and security interest in, for the benefit of Lender, any sums deposited pursuant to clause (i) above and that Borrower shall have no right to withdraw any such sums except for the payment of the aforesaid costs as approved by Lender. Lender shall have no obligation to make any further Advances of proceeds of the Loan as to any Line Item until the sums required to be deposited pursuant to clause (i) above as to such Line Item have been exhausted, or until Borrower has posted an irrevocable standby Letter of Credit pursuant to clause (iii) above, as the case may be, and, in any such case, the Loan is back “in balance”. Any such sums not used as provided in said clause (i) shall be released to Borrower when and to the extent that Lender reasonably determines that the amount thereof is more than the excess, if any, of the remaining Project-Related Costs over the undisbursed balance of the Loan, provided, however, that should an Event of Default occur, Lender, in its sole discretion, may apply such amounts either to the remaining Project-Related Costs or to the immediate reduction of outstanding principal and/or interest under the Note.38

Loan In Balance. As used herein, a “Shortfall” shall mean, as to any Line Item Borrower's Funds Account (a) The Loan is "in the Development Budget as of any date, balance" whenever the amount determined by Lender, in Lender’s sole but reasonable judgment, by which (A) the cost of completing or satisfying such Line Item, exceeds (B) the remaining undisbursed portion of the undisbursed Loan allocated to such Line Item in the Development Budget funds, plus any sums deposited with Lender pursuant provided or to this Section 2.1.10 be provided by Borrower as shown in the cost breakdown most recently approved by Bank, are sufficient in the reasonable judgment of Bank to pay for such Line Item pay, through completion of the Improvements and not previously disbursed plus any Reserve Funds to maturity of the extent such Reserve Funds are available hereunder for Loan, all of the payment of such Line Item. From time to time and at any time during the Construction Period, Lender shall have the right, but not the obligation, to notify Borrower that it has determined a Shortfall exists as to any one or more Line Items. If Lender at any time shall so notify Borrower, Borrower shall, at its option within five (5) days of Lender’s notification as aforesaid, eitherfollowing sums: (i) deposit with Lender an amount equal to such Shortfallall costs of construction, which Lender disburse to Borrower to the satisfaction marketing, ownership, maintenance and sale of the costs of such Line Item prior to advancing any further Loan proceeds on account of such costsLots; and (ii) post an irrevocable standby Letter of Credit all interest, including any and all Additional Interest, and all other sums which may accrue or be payable under the Loan Documents. Unless otherwise shown in the amount cost breakdown, all sums provided by Borrower will be deposited in an interest-bearing account being maintained at Bank in the name of Borrower (the "Borrower's Funds Account") on and subject to such Shortfallterms and conditions, and at such interest rates, as are generally made available to Bank's commercial customers. The Loan is "out of balance" if and when Bank in favor of Lender; its reasonable judgment determines that there are insufficient funds (iiiincluding all undisbursed Loan funds and any sums provided and to be provided by Borrower) to pay for all such costs and sums payable under the extent permitted under Sections 2.1.7 hereof and 5.1.33 Loan Documents. (b) Borrower acknowledges that the Loan may become "out of balance" in numerous ways, not all of which may now be foreseen. Borrower further acknowledges that the Loan may become "out of balance" from a shortage of funds in any single line item or category of the Building cost breakdown, even if there are undisbursed Loan Agreement, funds in other line items or categories. Undisbursed Loan funds in one category or line item may not be applied to another category or line item unless 3 either the cost breakdown allows such use (and following the satisfaction of the Initial Advance Conditions allocate the Contingency Reserve, with respect to the Line Item(s) in question, to the Shortfall, and provided, further that the amount of the remaining Contingency Reserve for such Line Item(s) (following the allocation to the Shortfall) is sufficient for such Line Item(s), as determined by Lender in its sole discretion; and (iv) to the extent permitted under Section 5.1.33 of the Building Loan Agreement, and then only following the satisfaction of the Initial Advance Conditions, reallocate cost savings from the Development Budget in respect of the Loan (or other reallocations which are approved by Lender, in its sole discretion) in accordance with the terms of this Agreement, but only to the extent specifically allowed) or Bank consents in writing to such cost savings can use in each instance, such consent not to be allocated to unreasonably withheld as long as the related Line Items. Borrower hereby agrees that Lender shall have a lien total undisbursed Loan funds from line items other than line items for interest on and security interest in, for the benefit of Lender, any sums deposited pursuant to clause (i) above and that Borrower shall have no right to withdraw any such sums except for the payment of the aforesaid costs as approved by Lender. Lender shall have no obligation to make any further Advances of proceeds of the Loan as are equal to any Line Item until or greater than the sums required unpaid cost to complete the Improvements. (c) Whenever the Loan becomes "out of balance," Bank may make written demand on Borrower to deposit Borrower's own funds into the Borrower's Funds Account in an amount sufficient in Bank's reasonable judgment to cause the Loan to be deposited pursuant to clause (i) above as to such Line Item have been exhausted"in balance." Upon Borrower's request, or until Bank shall advise Borrower has posted an irrevocable standby Letter of Credit pursuant to clause (iii) above, as the case may be, and, in any such case, Bank's basis for determining the Loan is back “in "out of balance”. Any such sums not used as provided in said clause (i) shall be released to Borrower when and ." Subject to the extent that Lender reasonably determines that the amount thereof is more than the excessprovisions of subparagraph 1.2(b), if anyBorrower shall deposit all funds required by Bank's demand within three (3) business days thereafter. If required by Bank, of the remaining Project-Related Costs over the undisbursed balance of the LoanBorrower shall also submit, providedfor Bank's approval, however, that should an Event of Default occur, Lender, in its sole discretion, may apply a revised cost breakdown within fifteen (15) days after any such amounts either to the remaining Project-Related Costs or to the immediate reduction of outstanding principal and/or interest under the Notedemand.