Common use of Reserve Clause in Contracts

Reserve. (a) Tenant, or Operator at Tenant's direction, shall establish an interest bearing reserve account (the "Reserve") in CNLBank or such other bank designated by Tenant, or Operator at the direction of Tenant, and reasonably approved by Landlord. All interest earned on the Reserve shall be added to and remain a part of the Reserve. Except as set forth in Section 5.1.2(e), Tenant, or Operator if so required by the Operating Agreement or designated by Tenant, shall be the only party entitled to withdraw funds from the Reserve. The purpose of the Reserve is to cover the cost of: (i) Replacements and renewals to the Facility's FF&E; and (ii) Certain routine repairs and maintenance to the Facility building (which are normally capitalized under GAAP) such as exterior and interior repainting, resurfacing building walls, floors, roofs and parking areas, and replacing folding walls and the like, but which are not Capital Expenditures. (b) Commencing with the Commencement Date and continuing throughout the Term, Tenant shall transfer, or shall direct Operator to transfer (as of the end of each Accounting Period of the Term), into the Reserve an amount equal to the Applicable Percentage of Total Facility Revenues for such Accounting Period. (c) Tenant, or Operator at the direction of Tenant, shall (endeavoring in good faith to comply with the applicable Reserve Estimate, unless there has been a change in circumstance from time to time) make such expenditures for the replacements, renewals, repairs, and maintenance described in this Section 5.1.2, as Tenant, or Operator if the Operating Agreement is in effect, deems necessary, up to the balance in the Reserve in order to maintain the Retirement Community consistent with (i) industry standards if the Operating Agreement is not in effect or (ii) the standards required by the Operating Agreement if the Operating Agreement is in effect, and in conformity with Legal Requirements. No expenditures will be made in excess of said balance without the approval of Landlord. In addition, Tenant, or Operator at the direction of Tenant, shall not, without Landlord's approval, make any expenditures from the Reserve that, in the aggregate, exceed the total aggregate amount of expenditures set forth in the then-applicable Reserve Estimate; provided, however, that Tenant, or Operator at the direction of Tenant, shall be authorized to take appropriate remedial action (including making any necessary expenditures from the Reserve above the total aggregate amount set forth in the then-applicable Reserve Estimate), without receiving Landlord's prior approval, to remedy or respond to any of the Emergency Requirements (provided further that Tenant, or Operator at the direction of Tenant, shall notify Landlord of any such remedial action that requires more than a de minimus expenditure of funds from the Reserve). At the end of each Fiscal Year, any amounts remaining in the Reserve shall be carried forward to the next Fiscal Year. Proceeds from the sale of FF&E no longer necessary to the operation of the Retirement Community shall be deposited in the Reserve, as shall any interest which accrues on amounts placed in the Reserve. Neither: (x) proceeds from the disposition of FF&E; nor (y) interest which accrues on amounts held in the Reserve, shall result in any reduction in the required Reserve payments or be included in Total Facility Revenues. Upon a sale of the Retirement Community, funds in the Reserve will not be affected, and all dispositions of such funds (both before and after such Sale of the Retirement Community) will continue to be made exclusively pursuant to the provisions of this Agreement or the Operating Agreement if applicable. Tenant, or Operator at the direction of Tenant, is authorized to lease (rather than purchase) shuttle vans, postal machines, photocopiers and other office equipment. If Tenant, or Operator at the direction of Tenant, enters into a lease described in the preceding sentence, Tenant, or Operator at the direction of Tenant, shall give Landlord Notice of such lease either prior to or promptly after entering into such lease. Lease payments with respect to such leases shall be paid from the Reserve. (d) Tenant, or Operator at the direction of Tenant, shall prepare an estimate (the "Reserve Estimate") of Reserve expenditures anticipated during the ensuing Fiscal Year and shall submit such Reserve Estimate to Landlord. Tenant or Operator, as applicable, will endeavor to follow the applicable FF&E Estimate, but shall be entitled to depart therefrom, in its reasonable discretion, provided that: (A) such departures from the applicable FF&E Estimate result from circumstances which could not reasonably have been foreseen at the time of the submission of such FF&E Estimate; and (B) such departures from the applicable FF&E Estimate result from circumstances which require prompt repair and/or replacement or are necessary to comply with Legal Requirements; and (C) Tenant or Operator, as applicable, has submitted to Landlord a revised FF&E Estimate setting forth and explaining such departures. (e) Tenant, or Operator at the direction of Tenant, shall from time to time make expenditures from the Reserve as it deems necessary in accordance with Section 5.1.2(a) and (c). Tenant, or Operator at Tenant's direction, shall provide to Landlord, within twenty (20) days after the end of each Accounting Period, a statement setting forth Reserve expenditures made to date during the Fiscal Year. Expenditures from the Reserve shall not be subject to Landlord's approval. (f) All funds in the Reserve, all interest earned thereon and all property purchased with funds from the Reserve shall be and remain the property of Landlord and any such property purchased with funds from the Reserve shall be part of the Leased Property and leased by Landlord to Tenant pursuant to this Agreement. Following expiration or earlier termination of this Agreement and payment in full on all contracts entered into prior to such expiration or termination for work to be done or furniture, furnishings, fixtures and equipment to be supplied in accordance with this Section 5.1.2 out of the Reserve, Tenant's rights hereunder or under the Operating Agreement relating to the Reserve shall be transferred from Tenant to Landlord, subject to the provisions of the Operating Agreement if applicable. (g) It is understood and agreed that during the term of the Pooling Agreement, the Reserve pursuant to this Agreement shall (i) also serve as the reserve, and be pooled with the Reserves, under the Other Leases in accordance with the provisions of the Pooling Agreement, and (ii) include amounts transferred to the Reserve under this Agreement and the Other Leases. (h) If Landlord wishes to grant a security interest in or create another encumbrance on the rights of Landlord with respect to the Reserve, the instrument granting such security interest or creating such other encumbrance shall expressly provide that such security interest or encumbrance is subject to the rights of Tenant with respect to the Reserve as set forth herein and the rights of the Operator pursuant to the Operating Agreement during the term of the Operating Agreement. The form and substance of such provision shall be subject to obtaining Tenant's prior written approval, which approval shall not be unreasonably withheld, delayed or conditioned.

Reserve. (a) Tenant, or Operator at Tenant's direction, shall establish an interest bearing reserve account (the "Reserve") in CNLBank or such other bank designated by Tenant, or Operator at the direction of Tenant, and reasonably approved by Landlord. All interest earned on the Reserve shall be added to and remain a part of the Reserve. Except as set forth in Section 5.1.2(e), Tenant, or Operator if so required by the Operating Agreement or designated by Tenant, shall be the only party entitled to withdraw funds from the Reserve. The purpose of the Reserve is to cover the cost of: (i) Replacements and renewals to the Facility's FF&E; FF&E and (ii) Certain routine repairs and maintenance to the Facility building (which are normally capitalized under GAAP) such as exterior and interior repainting, resurfacing building walls, floors, roofs and parking areas, and replacing folding walls and the like, but which are not Capital Expenditures. (b) Commencing with the Commencement Date and continuing throughout the Term, Tenant shall transfer, or shall direct Operator to transfer (as of the end of each Accounting Period of the Term), into the Reserve an amount equal to the Applicable Percentage of Total Facility Revenues for such Accounting Period. (c) Tenant, or Operator at the direction of Tenant, shall (endeavoring in good faith to comply with the applicable Reserve Estimate, unless there has been a change in circumstance from time to time) make such expenditures for the replacements, renewals, repairs, and maintenance described in this Section 5.1.2, as Tenant, or Operator if the Operating Agreement is in effect, deems necessary, up to the balance in the Reserve in order to maintain the Retirement Community consistent with (i) industry standards if the Operating Agreement is not in effect or (ii) the standards required by the Operating Agreement if the Operating Agreement is in effect, and in conformity with Legal Requirements. No expenditures will be made in excess of said balance without the approval of Landlord. In addition, Tenant, or Operator at the direction of Tenant, shall not, without Landlord's approval, make any expenditures from the Reserve that, in the aggregate, exceed the total aggregate amount of expenditures set forth in the then-applicable Reserve Estimate; provided, however, that Tenant, or Operator at the direction of Tenant, shall be authorized to take appropriate remedial action (including making any necessary expenditures from the Reserve above the total aggregate amount set forth in the then-applicable Reserve Estimate), without receiving Landlord's prior approval, to remedy or respond to any of the Emergency Requirements (provided further that Tenant, or Operator at the direction of Tenant, shall notify Landlord of any such remedial action that requires more than a de minimus expenditure of funds from the Reserve). At the end of each Fiscal Year, any amounts remaining in the Reserve shall be carried forward to the next Fiscal Year. Proceeds from the sale of FF&E no longer necessary to the operation of the Retirement Community shall be deposited in the Reserve, as shall any interest which accrues on amounts placed in the Reserve. Neither: (x) proceeds from the disposition of FF&E; FF&E nor (y) interest which accrues on amounts held in the Reserve, shall result in any reduction in the required Reserve payments or be included in Total Facility Revenues. Upon a sale of the Retirement Community, funds in the Reserve will not be affected, and all dispositions of such funds (both before and after such Sale of the Retirement Community) will continue to be made exclusively pursuant to the provisions of this Agreement or the Operating Agreement if applicable. Tenant, or Operator at the direction of Tenant, is authorized to lease (rather than purchase) shuttle vans, postal machines, photocopiers and other office equipment. If Tenant, or Operator at the direction of Tenant, enters into a lease described in the preceding sentence, Tenant, or Operator at the direction of Tenant, shall give Landlord Notice of such lease either prior to or promptly after entering into such lease. Lease payments with respect to such leases shall be paid from the Reserve. (d) Tenant, or Operator at the direction of Tenant, shall prepare an estimate (the "Reserve Estimate") of Reserve expenditures anticipated during the ensuing Fiscal Year and shall submit such Reserve Estimate to Landlord. Tenant or Operator, as applicable, will endeavor to follow the applicable FF&E Estimate, but shall be entitled to depart therefrom, in its reasonable discretion, provided that: (A) such departures from the applicable FF&E Estimate result from circumstances which could not reasonably have been foreseen at the time of the submission of such FF&E Estimate; and (B) such departures from the applicable FF&E Estimate result from circumstances which require prompt repair and/or replacement or are necessary to comply with Legal Requirements; and (C) Tenant or Operator, as applicable, has submitted to Landlord a revised FF&E Estimate setting forth and explaining such departures. (e) Tenant, or Operator at the direction of Tenant, shall from time to time make expenditures from the Reserve as it deems necessary in accordance with Section 5.1.2(a) and (c). Tenant, or Operator at Tenant's direction, shall provide to Landlord, within twenty (20) days after the end of each Accounting Period, a statement setting forth Reserve expenditures made to date during the Fiscal Year. Expenditures from the Reserve shall not be subject to Landlord's approval. (f) All funds in the Reserve, all interest earned thereon and all property purchased with funds from the Reserve shall be and remain the property of Landlord and any such property purchased with funds from the Reserve shall be part of the Leased Property and leased by Landlord to Tenant pursuant to this Agreement. Following expiration or earlier termination of this Agreement and payment in full on all contracts entered into prior to such expiration or termination for work to be done or furniture, furnishings, fixtures and equipment to be supplied in accordance with this Section 5.1.2 out of the Reserve, Tenant's rights hereunder or under the Operating Agreement relating to the Reserve shall be transferred from Tenant to Landlord, subject to the provisions of the Operating Agreement if applicable. (g) It is understood and agreed that during the term of the Pooling Agreement, the Reserve pursuant to this Agreement shall (i) also serve as the reserve, and be pooled with the Reserves, under the Other Leases in accordance with the provisions of the Pooling Agreement, and (ii) include amounts transferred to the Reserve under this Agreement and the Other Leases. (h) If Landlord wishes to grant a security interest in or create another encumbrance on the rights of Landlord with respect to the Reserve, the instrument granting such security interest or creating such other encumbrance shall expressly provide that such security interest or encumbrance is subject to the rights of Tenant with respect to the Reserve as set forth herein and the rights of the Operator pursuant to the Operating Agreement during the term of the Operating Agreement. The form and substance of such provision shall be subject to obtaining Tenant's prior written approval, which approval shall not be unreasonably withheld, delayed or conditioned.

Reserve. (a) Tenant, or Operator Manager, at Tenant's direction, shall establish an interest bearing reserve account (the "Reserve") in CNLBank CNL Bank approved by Landlord and Tenant, or such other in another bank designated by Tenant, or Operator at the direction of Tenant, Landlord and reasonably approved by LandlordTenant. All interest earned on the Reserve shall be added to and remain a part of the Reserve. Except as set forth in Section 5.1.2(e), Tenant, or Operator Manager if so required by the Operating Agreement or designated by Tenant, shall be the only party entitled to withdraw funds from the Reserve. The purpose of the Reserve is to cover the cost of: (i) Replacements Replacements, renewals and renewals additions to the Facility's FF&E; andfurniture, furnishings, fixtures and equipment at the Hotel; (ii) Certain routine repairs Repairs, renovations, renewals, additions, alterations, improvements or replacements and maintenance to the Facility building (Leased Property, all of which are routine or non-major and which are normally capitalized under GAAP) , such as exterior and interior repainting, resurfacing building walls, floors, roofs and parking areas, and replacing folding walls and the like, like (but which are not Capital Expendituresmajor repairs, alterations, improvements, renewals, replacements or additions to the Leased Property's structure, roof or exterior facade, or to its mechanical, electrical, heating, ventilating, air conditioning, plumbing or vertical transportation systems, the costs of which shall be governed, if at all, by Section 5.1.3 hereof); and (iii) At Tenant's option, lease payments for communications equipment and up to an aggregate of two (2) maintenance or shuttle vehicles used in connection with the operation of the Hotel. (b) Commencing with the Commencement Date and continuing throughout the Term, Tenant shall transfer, or shall direct Operator Manager to transfer (as of the end of each Accounting Period of the Term), ) into the Reserve an amount equal to the Applicable Percentage of Total Facility Revenues Hotel Sales for such Accounting Period.. At the time Tenant provides Landlord the documentation described in Section 3.1.2 (c) Tenant, or Operator at Tenant shall also deliver to Landlord a statement setting forth the direction total amount of Tenant, shall (endeavoring in good faith deposits made to comply with the applicable Reserve Estimate, unless there has been a change in circumstance from time to time) make such expenditures for the replacements, renewals, repairs, and maintenance described in this Section 5.1.2, as Tenant, or Operator if the Operating Agreement is in effect, deems necessary, up to the balance in the Reserve in order to maintain the Retirement Community consistent with (i) industry standards if the Operating Agreement is not in effect or (ii) the standards required by the Operating Agreement if the Operating Agreement is in effect, and in conformity with Legal Requirements. No expenditures will be made in excess of said balance without the approval of Landlord. In addition, Tenant, or Operator at the direction of Tenant, shall not, without Landlord's approval, make any expenditures from the Reserve that, in for the aggregate, exceed the total aggregate amount of expenditures set forth in the then-applicable Reserve Estimate; provided, however, that Tenant, or Operator at the direction of Tenant, shall be authorized to take appropriate remedial action (including making any necessary expenditures from the Reserve above the total aggregate amount set forth in the then-applicable Reserve Estimate), without receiving Landlord's prior approval, to remedy or respond to any of the Emergency Requirements (provided further that Tenant, or Operator at the direction of Tenant, shall notify Landlord of any such remedial action that requires more than a de minimus expenditure of funds from the Reserve). At the end of each preceding Fiscal Year, any amounts remaining in the Reserve shall be carried forward to the next Fiscal Year. Proceeds from the sale of FF&E no longer necessary to the operation of the Retirement Community shall be deposited in the Reserve, as shall any interest which accrues on amounts placed in the Reserve. Neither: (x) proceeds from the disposition of FF&E; nor (y) interest which accrues on amounts held in the Reserve, shall result in any reduction in the required Reserve payments or be included in Total Facility Revenues. Upon a sale of the Retirement Community, funds in the Reserve will not be affected, and all dispositions of such funds (both before and after such Sale of the Retirement Community) will continue to be made exclusively pursuant to the provisions of this Agreement or the Operating Agreement if applicable. Tenant, or Operator at the direction of Tenant, is authorized to lease (rather than purchase) shuttle vans, postal machines, photocopiers and other office equipment. If Tenant, or Operator at the direction of Tenant, enters into a lease described in the preceding sentence, Tenant, or Operator at the direction of Tenant, shall give Landlord Notice of such lease either prior to or promptly after entering into such lease. Lease payments with respect to such leases shall be paid from the Reserve. (d) Tenant, or Operator at the direction of Tenant, shall prepare an estimate (the "Reserve Estimate") of Reserve expenditures anticipated during the ensuing Fiscal Year and shall submit such Reserve Estimate to Landlord. Tenant or Operator, as applicable, will endeavor to follow the applicable FF&E Estimate, but shall be entitled to depart therefrom, in its reasonable discretion, provided that: (A) such departures from the applicable FF&E Estimate result from circumstances which could not reasonably have been foreseen at the time of the submission of such FF&E Estimate; and (B) such departures from the applicable FF&E Estimate result from circumstances which require prompt repair and/or replacement or are necessary to comply with Legal Requirements; and (C) Tenant or Operator, as applicable, has submitted to Landlord a revised FF&E Estimate setting forth and explaining such departures. (e) Tenant, or Operator at the direction of Tenant, shall from time to time make expenditures from the Reserve as it deems necessary in accordance with Section 5.1.2(a) and (c). Tenant, or Operator at Tenant's direction, shall provide to Landlord, within twenty (20) days after the end of each Accounting Period, a statement setting forth Reserve expenditures made to date during the Fiscal Year. Expenditures from the Reserve shall not be subject to Landlord's approval. (f) All funds in the Reserve, all interest earned thereon and all property purchased with funds from the Reserve shall be and remain the property of Landlord and any such property purchased with funds from the Reserve shall be part of the Leased Property and leased by Landlord to Tenant pursuant to this Agreement. Following expiration or earlier termination of this Agreement and payment in full on all contracts entered into prior to such expiration or termination for work to be done or furniture, furnishings, fixtures and equipment to be supplied in accordance with this Section 5.1.2 out of the Reserve, Tenant's rights hereunder or under the Operating Agreement relating to the Reserve shall be transferred from Tenant to Landlord, subject to the provisions of the Operating Agreement if applicable. (g) It is understood and agreed that during the term of the Pooling Agreement, the Reserve pursuant to this Agreement shall (i) also serve as the reserve, and be pooled with the Reserves, under the Other Leases in accordance with the provisions of the Pooling Agreement, and (ii) include amounts transferred to the Reserve under this Agreement and the Other Leases. (h) If Landlord wishes to grant a security interest in or create another encumbrance on the rights of Landlord with respect to the Reserve, the instrument granting such security interest or creating such other encumbrance shall expressly provide that such security interest or encumbrance is subject to the rights of Tenant with respect to the Reserve as set forth herein and the rights of the Operator pursuant to the Operating Agreement during the term of the Operating Agreement. The form and substance of such provision shall be subject to obtaining Tenant's prior written approval, which approval shall not be unreasonably withheld, delayed or conditioned.

Reserve. (a) Tenant, or Operator at Tenant's direction, 5.2.1 Tenant shall establish an interest bearing reserve account (the "Reserve") in CNLBank or such other a bank designated by Tenant, or Operator at the direction of Tenant, Tenant and reasonably approved by Landlord. All interest earned on the Reserve shall be added to and remain a part of the Reserve. Except as set forth in Section 5.1.2(e), Tenant, or Operator if so required by the Operating Agreement or designated by Tenant, Both Tenant and Landlord shall be signatories on the Reserve, provided only party entitled one signature shall be required to withdraw funds and Landlord agrees that so long as Tenant is not in default hereunder, Landlord shall not be required to sign on any checks and Landlord shall not withdraw any funds from such account. Upon the Reserveoccurrence and continuation of any Default or Event of Default hereunder the Tenant signatory party shall no longer be an authorized signatory on the Reserve account. Such account shall be established in Landlord's name and control for the benefit of Tenant and shall not include or contemplate "overdraft protection" and Tenant shall not request or attempt to draw or draft any funds which are not actually on deposit in such account. The purpose of the Reserve is to cover the cost of:of the following, to the extent carried out in accordance with this Agreement (collectively, "Reserve Expenditures"): (ia) Replacements (including P&E Replacements), renewals and renewals additions to the P&E at the Facility's FF&E; and (iib) Certain repairs, alterations, improvements, renewals, replacements and additions, whether routine, non-routine repairs and maintenance or major, to the Facility building (Leased Improvements, including without limitation those which are normally capitalized under GAAP) GAAP such as repairs, alterations, improvements, renewals, replacements and additions to the structure, the exterior facade, the mechanical, electrical, heating, ventilating, air conditioning, plumbing and interior repaintingvertical transportation elements of the Leased Improvements, resurfacing building walls, floors, roofs and parking areas, and replacing folding walls and which expenditures Tenant believes should be made for the like, but which are not Capital ExpendituresLeased Property for the following Fiscal Year. (b) 5.2.2 Commencing with the Commencement Date and continuing throughout the Term, Tenant shall transfer, or shall direct Operator to transfer (as of on the end last day of each Accounting Period of during the Term), transfer into the Reserve an amount equal to the Applicable Reserve Percentage of Total Facility Revenues for such Accounting Period. Period (c) Tenantbased upon estimates of Total Facility Revenue if necessary, or Operator at to be adjusted as soon as Tenant has had an opportunity to confirm actual Total Facility Revenue). At the direction of Tenant, shall (endeavoring in good faith to comply with time Tenant provides Landlord the applicable Reserve Estimate, unless there has been a change in circumstance from time to time) make such expenditures for the replacements, renewals, repairs, and maintenance documentation described in this Section 5.1.23.3, as Tenant, or Operator if Tenant shall also deliver to Landlord a statement setting forth the Operating Agreement is in effect, deems necessary, up total amount of deposits made to the balance in the Reserve in order to maintain the Retirement Community consistent with (i) industry standards if the Operating Agreement is not in effect or (ii) the standards required by the Operating Agreement if the Operating Agreement is in effect, and in conformity with Legal Requirements. No expenditures will be made in excess of said balance without the approval of Landlord. In addition, Tenant, or Operator at the direction of Tenant, shall not, without Landlord's approval, make any expenditures from the Reserve that, in for the aggregate, exceed the total aggregate amount of expenditures set forth in the then-applicable Reserve Estimate; provided, however, that Tenant, preceding Fiscal Year. 5.2.3 On or Operator at the direction of Tenant, shall be authorized to take appropriate remedial action (including making any necessary expenditures from the Reserve above the total aggregate amount set forth in the then-applicable Reserve Estimate), without receiving Landlord's prior approval, to remedy or respond to any of the Emergency Requirements (provided further that Tenant, or Operator at the direction of Tenant, shall notify Landlord of any such remedial action that requires more than a de minimus expenditure of funds from the Reserve). At the end before December 1 of each Fiscal Year, any amounts remaining in the Reserve shall be carried forward to the next Fiscal Year. Proceeds from the sale of FF&E no longer necessary to the operation of the Retirement Community shall be deposited in the Reserve, as shall any interest which accrues on amounts placed in the Reserve. Neither: (x) proceeds from the disposition of FF&E; nor (y) interest which accrues on amounts held in the Reserve, shall result in any reduction in the required Reserve payments or be included in Total Facility Revenues. Upon a sale of the Retirement Community, funds in the Reserve will not be affected, and all dispositions of such funds (both before and after such Sale of the Retirement Community) will continue to be made exclusively pursuant to the provisions of this Agreement or the Operating Agreement if applicable. Tenant, or Operator at the direction of Tenant, is authorized to lease (rather than purchase) shuttle vans, postal machines, photocopiers and other office equipment. If Tenant, or Operator at the direction of Tenant, enters into a lease described in the preceding sentence, Tenant, or Operator at the direction of Tenant, shall give Landlord Notice of such lease either prior to or promptly after entering into such lease. Lease payments with respect to such leases shall be paid from the Reserve. (d) Tenant, or Operator at the direction of Tenant, Tenant shall prepare an estimate (the "Reserve Estimate") of Reserve expenditures Expenditures anticipated during the ensuing Fiscal Year and shall submit such Reserve Estimate to LandlordLandlord for its review. Tenant or Operator, as applicable, will endeavor to follow Such Reserve Estimate shall reflect by line item the applicable FF&E Estimate, but shall be entitled to depart therefrom, in its reasonable discretion, provided that: (A) such departures from the applicable FF&E Estimate result from circumstances which could not reasonably have been foreseen at the time of the submission of such FF&E Estimate; and (B) such departures from the applicable FF&E Estimate result from circumstances which require prompt repair and/or replacement or are necessary to comply with Legal Requirements; and (C) Tenant or Operator, as applicable, has submitted to Landlord a revised FF&E Estimate setting forth and explaining such departures. (e) Tenant, or Operator at the direction of Tenant, shall from time to time make expenditures from the projected budget for Reserve as it deems necessary in accordance with Section 5.1.2(a) and (c). Tenant, or Operator at Tenant's direction, shall provide to Landlord, within twenty (20) days after the end of each Accounting Period, a statement setting forth Reserve expenditures made to date during the Fiscal Year. Expenditures from the Reserve shall not be subject to Landlord's approval. (f) All funds in the Reserve, all interest earned thereon and all property purchased with funds from the Reserve shall be and remain the property of Landlord and any such property purchased with funds from the Reserve shall be part of for the Leased Property and leased assumptions on the basis of which such line items were prepared in narrative form if necessary, including separate budget items for all projected expenditures for replacements, substitutions and additions to Tenant's Personal Property. Tenant shall provide to Landlord reasonable additional detail, information and assumptions used in the preparation of the Reserve Estimate as requested by Landlord and shall also submit to Tenant pursuant to this Agreement. Following expiration or earlier termination of this Agreement and payment in full on all contracts entered into prior to such expiration or termination for work to be done or furniture, furnishings, fixtures and equipment to be supplied in accordance Landlord with this Section 5.1.2 out of the Reserve, Tenant's rights hereunder or under the Operating Agreement relating to the Reserve shall be transferred from Tenant to Landlord, subject to the provisions Estimate good faith longer-range projections of the Operating Agreement if applicable. planned Reserve Expenditures for an additional three (g) It is understood and agreed that during the term of the Pooling Agreement, the Reserve pursuant to this Agreement shall (i) also serve as the reserve, and be pooled with the Reserves, under the Other Leases in accordance with the provisions of the Pooling Agreement, and (ii) include amounts transferred to the Reserve under this Agreement and the Other Leases. (h) If Landlord wishes to grant a security interest in or create another encumbrance on the rights of Landlord with respect to the Reserve, the instrument granting such security interest or creating such other encumbrance shall expressly provide that such security interest or encumbrance is subject to the rights of Tenant with respect to the Reserve as set forth herein and the rights of the Operator pursuant to the Operating Agreement during the term of the Operating Agreement. The form and substance of such provision shall be subject to obtaining Tenant's prior written approval, which approval shall not be unreasonably withheld, delayed or conditioned.3)

Reserve. (a) TenantPrior to or simultaneously with the execution of this Agreement, or Operator at Tenant's directionLandlord has deposited an aggregate amount of One Million Five Hundred Thousand Dollars ($1,500,000) with respect to the Collective Leased Properties, shall establish such sum to be held in an interest bearing reserve account established by Tenant (the "Reserve") in CNLBank or such other a bank designated by Tenant, or Operator at the direction of Tenant, Landlord and reasonably approved by LandlordTenant. All interest earned on the Reserve shall be added to and remain a part apart of the Reserve. Except as set forth in Section 5.1.2(e), Tenant, or Operator if so required by the Operating Agreement or designated by Tenant, Tenant shall be the only party entitled to withdraw funds from the ReserveReserve until an Event of Default shall occur, Landlord agreeing, however, that, following the occurrence of an Event of Default and until such time as this Agreement shall have been terminated, Landlord shall continue to make payments from the Reserve to contractors and materialmen pursuant to Contracts made by Tenant for items which are permitted Reserve expenditures, provided that Landlord shall reasonably determine that there are adequate Reserve funds available therefor. The purpose of the Reserve is to cover the cost of: (i) Replacements Replacements, renewals and renewals additions to the Facility's FF&E; andfurniture, furnishings, fixtures and equipment at the Hotel and the other hotels located at the Collective Leased Properties; (ii) Certain routine repairs Routine repairs, renovations, renewals, additions, alterations, improvements or replacements and maintenance to the Facility building (Leased Property and the buildings and improvements located at the Collective Leased Properties which are normally capitalized under GAAP) GAAP such as exterior and interior repainting, resurfacing building walls, floors, roofs and parking areas, and replacing folding walls and the like; (iii) Major repairs, but which renovations, additions, alterations, improvements, renewals or replacements to the Leased Property and the buildings and improvements located at the Collective Leased Properties, including, without limitation, with respect to their structure, roof, or exterior facade, and to their mechanical, electrical, heating, ventilating, air conditioning, plumbing or vertical transportation systems; (iv) All lease payments for equipment and other personal property reasonably necessary for the operation of the Hotel and the hotels located at the Collective Leased Properties; and (v) Repairs, replacements and renewals; and other expenditures costing in excess of $25,000 per Lease Year at the Collective Leased Properties; provided, in each case, such repairs, replacements, renewals or other expenditures are not Capital Expendituresrequired to comply with Legal Requirements and Insurance Requirements. (b) Commencing with the Commencement Date and continuing throughout Throughout the Term, Tenant shall transfer, or shall direct Operator to transfer (as of the end of each Accounting Period of the Term), ) into the Reserve an amount equal to the Applicable Percentage of Total Facility Revenues Hotel Sales for such Accounting Period; provided; however, that Tenant shall have no obligation to fund and/or transfer any funds to the Reserve until such time as the Reserve balance would equal One Million Five Hundred Thousand Dollars ($1,500,000) had Tenant funded the Reserve as required by the preceding clause of this sentence. Together with the documentation provided to Landlord pursuant to Section 3.1.2(c), Tenant shall deliver to Landlord an Officer's Certificate setting forth the total amount of deposits made to and expenditures from the Reserve for the preceding Fiscal Year, together with a comparison of such expenditures with the applicable Reserve Estimate. (c) TenantEach year, on or Operator at the direction of Tenant, shall (endeavoring in good faith to comply with the applicable Reserve Estimate, unless there has been a change in circumstance from time to time) make such expenditures for the replacements, renewals, repairs, and maintenance described in this Section 5.1.2, as Tenant, or Operator if the Operating Agreement is in effect, deems necessary, up to the balance in the Reserve in order to maintain the Retirement Community consistent with (i) industry standards if the Operating Agreement is not in effect or (ii) the standards required by the Operating Agreement if the Operating Agreement is in effect, and in conformity with Legal Requirements. No expenditures will be made in excess of said balance without the approval of Landlord. In addition, Tenant, or Operator at the direction of Tenant, shall not, without Landlord's approval, make any expenditures from the Reserve that, in the aggregate, exceed the total aggregate amount of expenditures set forth in the then-applicable Reserve Estimate; provided, however, that Tenant, or Operator at the direction of Tenant, shall be authorized to take appropriate remedial action (including making any necessary expenditures from the Reserve above the total aggregate amount set forth in the then-applicable Reserve Estimate), without receiving Landlord's prior approval, to remedy or respond to any before December 1 of the Emergency Requirements (provided further that Tenantpreceding year, or Operator at the direction of Tenant, shall notify Landlord of any such remedial action that requires more than a de minimus expenditure of funds from the Reserve). At the end of each Fiscal Year, any amounts remaining in the Reserve shall be carried forward to the next Fiscal Year. Proceeds from the sale of FF&E no longer necessary to the operation of the Retirement Community shall be deposited in the Reserve, as shall any interest which accrues on amounts placed in the Reserve. Neither: (x) proceeds from the disposition of FF&E; nor (y) interest which accrues on amounts held in the Reserve, shall result in any reduction in the required Reserve payments or be included in Total Facility Revenues. Upon a sale of the Retirement Community, funds in the Reserve will not be affected, and all dispositions of such funds (both before and after such Sale of the Retirement Community) will continue to be made exclusively pursuant to the provisions of this Agreement or the Operating Agreement if applicable. Tenant, or Operator at the direction of Tenant, is authorized to lease (rather than purchase) shuttle vans, postal machines, photocopiers and other office equipment. If Tenant, or Operator at the direction of Tenant, enters into a lease described in the preceding sentence, Tenant, or Operator at the direction of Tenant, shall give Landlord Notice of such lease either prior to or promptly after entering into such lease. Lease payments with respect to such leases shall be paid from the Reserve. (d) Tenant, or Operator at the direction of Tenant, Tenant shall prepare an estimate (the "Reserve Estimate") of Reserve expenditures anticipated necessary during the ensuing Fiscal Year Year, and shall submit such Reserve Estimate to LandlordLandlord for its review. Tenant or Operator, as applicable, will endeavor to follow All expenditures from the applicable FF&E Estimate, but Reserve shall be entitled (as to depart therefromboth the amount of each such expenditure and the timing thereof) both reasonable and necessary, given the objective that the Hotel will be maintained and operated to a standard comparable to competitive properties and in its reasonable discretion, provided that: (A) such departures from accordance with the applicable FF&E Estimate result from circumstances which could not reasonably have been foreseen at standards set forth in the time of the submission of such FF&E Estimate; and (B) such departures from the applicable FF&E Estimate result from circumstances which require prompt repair and/or replacement or are necessary to comply with Legal Requirements; and (C) Tenant or Operator, as applicable, has submitted to Landlord a revised FF&E Estimate setting forth and explaining such departuresFranchise Agreement. (ed) Tenant, or Operator at the direction of Tenant, Tenant shall from time to time make expenditures from the Reserve as it deems necessary in accordance with Section 5.1.2(a) and (c). Tenant, or Operator at Tenant's direction, Tenant shall provide to Landlord, within twenty forty (2040) days Business Days after the end of each Accounting Period, a statement setting forth forth, on a line item basis, Reserve expenditures made to date during the Fiscal Year. Expenditures and any variances or anticipated variances and/or amendments from the Reserve shall not be subject to Landlord's approvalEstimate. (fe) All funds in the Reserve, all interest earned thereon and all property purchased with funds from the Reserve shall be and remain the property of Landlord and any such property purchased with funds from the Reserve shall be part of the Leased Property and leased by Landlord to Tenant pursuant to this Agreement. Following expiration or earlier termination of this Agreement and payment in full on all contracts entered into prior to such expiration or termination for work to be done or furniture, furnishings, fixtures and equipment to be supplied in accordance with this Section 5.1.2 out of the Reserve, Tenant's rights hereunder or under the Operating Agreement relating to the Reserve shall be transferred from Tenant to Landlord, subject to the provisions of the Operating Agreement if applicable. (gf) It is understood and agreed that during the term of the Pooling Agreement, the Reserve pursuant to this Agreement shall (i) also serve as the reserve, and be pooled with the Reserves, under the Other Leases shall be maintained and used on a consolidated basis such that all Reserve funds shall be deposited in a single account and Tenant may apply any funds therein to any of the Collective Leased Properties in accordance with the provisions terms of the Pooling Agreement, and (ii) include amounts transferred to the Reserve under this Agreement and the Other Leases. (hg) If Landlord wishes to grant a security interest in or create another encumbrance on the rights Reserve, all or any part of Landlord with respect to the Reserveexisting or future funds therein, or any general intangible in connection therewith, the instrument granting such security interest or creating such other encumbrance shall expressly provide that such security interest or encumbrance is subject to the rights of Tenant with respect to the Reserve as set forth herein and the rights of the Operator pursuant to the Operating Agreement during the term of the Operating Agreementherein. The form and substance of such provision shall be subject to obtaining Tenant's prior written approval, which approval shall not be unreasonably withheld, delayed or conditioned.

Reserve. (a) TenantSubject to the terms of this Section 5.1.2, or Operator at Tenant's direction, Tenant shall establish an interest bearing reserve account (the "Reserve") in CNLBank or such other a bank designated by Landlord. The Bank designated by Landlord shall have a Minimum of Twenty Million and 00/100 ($20,000,000.00) in assets and shall not be under any regulatory orders from any federal or state banking authorities. If during the Term, such bank shall not meet the foregoing criteria the Reserve shall be moved to another bank mutually agreed to by Landlord and Tenant, or Operator at the direction of Tenant, and reasonably approved by Landlord. All interest earned on the Reserve shall be added to and remain a part of the Reserve. Except as set forth in Section 5.1.2(e), Tenant, or Operator if so required by the Operating Agreement or designated by Tenant, Both Tenant and Landlord shall be signatories on the Reserve, provided only party entitled one signature shall be required to withdraw funds and Landlord agrees that so long as no Event of Default exists hereunder, Landlord shall not be required to sign on any checks and Landlord shall not withdraw any funds from the Reservesuch account. Such account shall not include or contemplate "overdraft protection" and Tenant shall not request or attempt to draw or draft any funds which are not actually on deposit in such account. The purpose of the Reserve is to cover the cost of:of the following, (which costs payable out of the Reserve shall include, with respect to any cost item, any customary market-rate supervisory fee, and any other fee commonly referred to as "purchasing fees", charged by Tenant, Manager or any Affiliated Person for services rendered in connection herewith) to the extent carried out in accordance with this Agreement (collectively, "Reserve Expenditures"): (i) Replacements Replacements, renewals and renewals additions to the Facilityfurniture, furnishings, fixtures and equipment at the Hotel (but excluding Tenant's FF&EPersonal Property); and (ii) Certain routine repairs Repairs, renovations, renewals, additions, alterations, improvements or replacements and maintenance to the Facility building (Leased Property, including without limitation, to maintain the Leased Property in conformity with Wyndham Standards, all of which are routine and which are normally capitalized under GAAP) , such as exterior and interior repainting, resurfacing building walls, floors, roofs and parking areas, and replacing folding walls and the like, but which are not Capital Expenditures. (b) Commencing with the Commencement Date and continuing throughout the Term, Tenant shall transfer, or shall direct Operator to transfer (as of on the end last day of each Accounting Period of during the Term), transfer into the Reserve an amount equal to the Applicable Percentage of Total Facility Revenues for such Accounting Period. At the time Tenant provides Landlord the documentation described in Section 3.1.3, Tenant shall also deliver to Landlord a statement setting forth the total amount of deposits made to and expenditures from the Reserve for the preceding Fiscal Year. (c) Tenant, On or Operator at before the direction of Tenant, shall Commencement Date (endeavoring in good faith with respect to comply with the applicable Reserve Estimate, unless there has been a change in circumstance from time to time) make such expenditures for the replacements, renewals, repairsfirst partial Fiscal Year), and maintenance described in this Section 5.1.2, as Tenant, or Operator if the Operating Agreement is in effect, deems necessary, up to the balance in the Reserve in order to maintain the Retirement Community consistent with (i) industry standards if the Operating Agreement is not in effect or (ii) the standards required by the Operating Agreement if the Operating Agreement is in effect, and in conformity with Legal Requirements. No expenditures will be made in excess of said balance without the approval of Landlord. In addition, Tenant, or Operator at the direction of Tenant, shall not, without Landlord's approval, make any expenditures from the Reserve that, in the aggregate, exceed the total aggregate amount of expenditures set forth in the then-applicable Reserve Estimate; provided, however, that Tenant, or Operator at the direction of Tenant, shall be authorized to take appropriate remedial action (including making any necessary expenditures from the Reserve above the total aggregate amount set forth in the then-applicable Reserve Estimate), without receiving Landlord's prior approval, to remedy or respond to any of the Emergency Requirements (provided further that Tenant, or Operator at the direction of Tenant, shall notify Landlord of any such remedial action that requires more than a de minimus expenditure of funds from the Reserve). At the end December 1 of each Fiscal YearYear thereafter, any amounts remaining in the Reserve shall be carried forward to the next Fiscal Year. Proceeds from the sale of FF&E no longer necessary to the operation of the Retirement Community shall be deposited in the Reserve, as shall any interest which accrues on amounts placed in the Reserve. Neither: (x) proceeds from the disposition of FF&E; nor (y) interest which accrues on amounts held in the Reserve, shall result in any reduction in the required Reserve payments or be included in Total Facility Revenues. Upon a sale of the Retirement Community, funds in the Reserve will not be affected, and all dispositions of such funds (both before and after such Sale of the Retirement Community) will continue to be made exclusively pursuant to the provisions of this Agreement or the Operating Agreement if applicable. Tenant, or Operator at the direction of Tenant, is authorized to lease (rather than purchase) shuttle vans, postal machines, photocopiers and other office equipment. If Tenant, or Operator at the direction of Tenant, enters into a lease described in the preceding sentence, Tenant, or Operator at the direction of Tenant, shall give Landlord Notice of such lease either prior to or promptly after entering into such lease. Lease payments with respect to such leases shall be paid from the Reserve. (d) Tenant, or Operator at the direction of Tenant, Tenant shall prepare an estimate (the "Reserve Estimate") of Reserve expenditures Expenditures anticipated during the ensuing Fiscal Year and shall submit such Reserve Estimate to Landlord for its review and approval. Such Reserve Estimate shall reflect by line item the projected budget for Reserve Expenditures for the Leased Property and assumptions on the basis of which such line items were prepared in narrative form if necessary, and shall include separate budget items for all projected expenditures for replacements, substitutions and additions to Tenant's Personal Property (which expenditures shall be made by Tenant using its own funds and not the Reserve). Tenant shall provide to Landlord reasonable additional detail, information and assumptions used in the preparation of the Reserve Estimate as requested by Landlord. Tenant shall review the Reserve Estimate with Landlord, and subject to Landlord's approval, (which approval shall not be withheld for (i) Tenant's Personal Property, or Operator(ii) Reserve Expenditures required by Legal Requirements), as applicable, will endeavor to follow (for purposes hereof the applicable FF&E Estimate, but expenditures contemplated in subsection (ii) shall be entitled deemed included in the Approved Reserve Estimate as hereafter referenced and any dispute as to depart therefromwhether such expenditure is required by Legal Requirements will be resolved pursuant to ARTICLE 19 hereof) Tenant shall implement such Reserve Estimate for the successive Fiscal Year (during which it shall, if approved by Landlord, be referred to as the "Approved Reserve Estimate"). Landlord shall have the right to disapprove any expenditures to be provided for in the Reserve Estimate in its reasonable discretion, except as otherwise provided that: (A) such departures from the applicable FF&E Estimate result from circumstances which could not reasonably have been foreseen at the time herein. However, if Landlord disapproves any expenditure, Landlord shall notify Tenant in reasonable detail of the submission of reasons for such FF&E Estimate; and (B) disapproval. If any such departures from the applicable FF&E Estimate result from circumstances which require prompt repair and/or replacement or are expenditure disapproved by Landlord is, in Tenant's reasonable judgment, necessary to comply with Wyndham Standards, Tenant shall notify Landlord of such fact and Landlord shall approve the same or such dispute as to whether such expenditure is reasonably necessary to comply with Wyndham Standards will be resolved pursuant to ARTICLE 19 hereof. Further, Landlord's approval of any expenditure pursuant to the Reserve Estimate shall not be, or be deemed to be, an assumption by Landlord of any liability in connection with the expenditures made. Pending resolution by Landlord and Tenant (and not by arbitration, except with respect to expenditures required for Legal Requirements; Requirements and Wyndham Standards as aforesaid) of any dispute regarding a proposed Reserve Expenditure, the specific disputed item of the Reserve Estimate shall be suspended and replaced for the Fiscal Year in question by an amount equal to the lesser of (Ca) that proposed by Tenant for such Fiscal Year or Operator(b) such budget item for the Fiscal Year prior thereto. Tenant shall not make any expenditures from the Reserve, except those included in the Approved Reserve Estimate, nor shall Tenant deviate from the Approved Reserve Estimate without the prior approval of Landlord, except in the case of emergency where immediate action is necessary to prevent imminent danger to person or property or imminent danger of civil or criminal liability. Provided, however, in the event the actual cost of any approved Reserve Expenditure is less than the budgeted amount therefor contained in the Approved Reserve Estimate, Tenant may apply such savings without Landlord's approval to other approved Reserve Expenditures contained in the Approved Reserve Estimate so long as applicablethe aggregate actual Reserve Expenditures in any given Lease Year does not exceed the aggregate Reserve Expenditures contained in the Approved Reserve Estimate for such Lease Year. Upon the expiration or earlier termination of this Agreement, has submitted funds in the Reserve and all property purchased with funds in the Reserve shall be paid, granted and assigned to Landlord a revised FF&E Estimate setting forth and explaining such departuresas Additional Charges. (ed) TenantTenant shall, or Operator at consistent with the direction of TenantApproved Reserve Estimate, shall from time to time make expenditures Reserve Expenditure from the Reserve as it reasonably deems necessary in accordance with Section 5.1.2(a) and (c). Tenant, or Operator at Tenant's direction, Tenant shall provide to Landlord, within twenty thirty (2030) days after the end of each Accounting Period, a an itemized statement setting forth Reserve expenditures Expenditures made to date during the Fiscal Year. Expenditures from Year and shall also provide all other necessary invoices and supporting documentation reasonably necessary for Landlord to account for and verify the Reserve shall not be subject to Landlord's approvalExpenditures. (fe) All funds in the Reserve, all interest earned thereon and all property purchased with funds from the Reserve shall be and remain the property of Landlord and any such property purchased with funds from the Reserve shall be part of the Leased Property and leased by Landlord to Tenant pursuant to this AgreementLandlord. Following expiration or earlier termination of this Agreement and payment in full on all contracts entered into prior to such expiration or termination for work to be done or furniture, furnishings, fixtures and equipment to be supplied in accordance with this Section 5.1.2 out of the Reserve, Tenant's rights hereunder or under the Operating Agreement relating to control over the Reserve shall be transferred from Tenant to Landlord, subject to the provisions of the Operating Agreement if applicable. (gf) It is understood and agreed that during the term of the Pooling Agreement, the Reserve pursuant to this Agreement shall (i) also serve as the reserve, be maintained and be pooled used solely in connection with the ReservesLeased Property. To the extent the funds in the Reserve are permitted hereunder to be used by Tenant to maintain the Leased Property, under Landlord agrees that except upon the Other Leases in accordance occurrence and during the continuance of an Event of Default hereunder, Landlord will not interfere with the provisions use of the Pooling Agreement, and (ii) include amounts transferred to the Reserve under this Agreement and the Other Leasessuch funds by Tenant for such purpose. (hg) If Landlord wishes to grant a security interest in or create another encumbrance on the rights Reserve in connection with a Hotel Mortgage, all or any part of the existing or future funds therein, or any general intangible in connection therewith, Tenant agrees that it will, from time to time, execute such reasonable documentation as may be requested by Landlord with respect and any Mortgagee to assist Landlord and such Mortgagee in establishing or perfecting its security interest in Landlord's interest in the Reserve; provided, however, that (i) no such documentation shall contain an amendment or modification of any of the provisions of this Agreement; and (ii) the instrument granting such security interest or creating such other encumbrance shall expressly provide that such security interest or encumbrance is subject to the rights of Tenant with respect to the Reserve as set forth herein herein. It is understood and agreed that during the rights Term the Reserve may not be applied against debts secured by a Hotel Mortgage, nor shall any Mortgagee have the right to approve the release of the Operator such funds pursuant to the Operating terms of this Agreement during unless and until Landlord shall default in its obligations to such Mortgagee and then only in accordance with the term terms of the Operating this Agreement. The form and substance of such provision shall be subject to obtaining Tenant's prior written approval, which approval shall not be unreasonably withheld, delayed or conditioned.

Reserve. (a) Tenant, or Operator at Tenant's direction, Tenant shall establish an interest bearing reserve account (the "Reserve") in CNLBank or such other bank designated by Tenant, or Operator at the direction of Tenant, Tenant and reasonably approved by Landlord. All interest earned on the Reserve shall be added to and remain a part of the Reserve. Except as set forth in Section 5.1.2(e), Tenant, or Operator if so required by the Operating Agreement or designated by Tenant, Tenant shall be the only party entitled to withdraw funds from the Reserve. The purpose of the Reserve is to cover the cost of: (i) Replacements and renewals to the Facility's FF&E; FF&E and (ii) Certain routine repairs and maintenance to the Facility building (which are normally capitalized under GAAP) such as exterior and interior repainting, resurfacing building walls, floors, roofs and parking areas, and replacing folding walls and the like, but which are not Capital Expenditures; and (iii) Capital Expenditures which may be paid from the Reserve pursuant to Section 5.1.5(c) below. (b) Commencing with the Commencement Date and continuing throughout the Term, Tenant shall transfer, or shall direct Operator to transfer (as of the end of each Accounting Period of the Term), into the Reserve an amount equal to the Applicable Percentage of Total Facility Revenues for such Accounting Period. (c) Tenant, or Operator at the direction of Tenant, Tenant shall (endeavoring in good faith to comply with the applicable Reserve Estimate, unless there has been a change in circumstance from time to time) make such expenditures for the replacements, renewals, repairs, and maintenance described in this Section 5.1.2, as Tenant, or Operator if the Operating Agreement is in effect, Tenant deems necessary, up to the balance in the Reserve in order to maintain the Retirement Community consistent with (i) industry standards if the Operating Agreement is not in effect or (ii) the standards required by the Operating Agreement if the Operating Agreement is in effect, and in conformity with Legal Requirements. No expenditures will be made in excess of said balance without the approval of Landlord. In addition, Tenant, or Operator at the direction of Tenant, Tenant shall not, without Landlord's approval, make any expenditures from the Reserve that, in the aggregate, exceed the total aggregate amount of expenditures set forth in the then-applicable Reserve Estimate; provided, however, that Tenant, or Operator at the direction of Tenant, Tenant shall be authorized to take appropriate remedial action (including making any necessary expenditures from the Reserve above the total aggregate amount set forth in the then-applicable Reserve Estimate), without receiving Landlord's prior approval, to remedy or respond to any of the Emergency Requirements (provided further that Tenant, or Operator at the direction of Tenant, Tenant shall notify Landlord of any such remedial action that requires more than a de minimus expenditure of funds from the Reserve). At the end of each Fiscal Year, any amounts remaining in the Reserve shall be carried forward to the next Fiscal Year. Proceeds from the sale of FF&E no longer necessary to the operation of the Retirement Community shall be deposited in the Reserve, as shall any interest which accrues on amounts placed in the Reserve. Neither: (x) proceeds from the disposition of FF&E; FF&E nor (y) interest which accrues on amounts held in the Reserve, shall result in any reduction in the required Reserve payments or be included in Total Facility Revenues. Upon a sale of the Retirement Community, funds in the Reserve will not be affected, and all dispositions of such funds (both before and after such Sale sale of the Retirement Community) will continue to be made exclusively pursuant to the provisions of this Agreement or the Operating Agreement if applicableAgreement. Tenant, or Operator at the direction of Tenant, Tenant is authorized to lease (rather than purchase) shuttle vans, postal machines, photocopiers and other office equipment. If Tenant, or Operator at the direction of Tenant, enters into a lease described in the preceding sentence, Tenant, or Operator at the direction of Tenant, shall give Landlord Notice of such lease either prior to or promptly after entering into such lease. Lease payments with respect to such leases shall be paid from the Reserveas a Property Expense. (d) Tenant, or Operator at the direction of Tenant, Tenant shall prepare an estimate (the "Reserve Estimate") of Reserve expenditures anticipated during the ensuing Fiscal Year and shall submit such Reserve Estimate to LandlordLandlord by no later than October 15th of each year. Tenant or Operator, as applicable, will endeavor to follow the applicable FF&E Reserve Estimate, but shall be entitled to depart therefrom, in its reasonable discretion, provided that: (A) such departures from the applicable FF&E Reserve Estimate result from circumstances which could not reasonably have been foreseen at the time of the submission of such FF&E Reserve Estimate; and (B) such departures from the applicable FF&E Reserve Estimate result from circumstances which require prompt repair and/or replacement or are necessary to comply with Legal Requirements; and (C) Tenant or Operator, as applicable, has submitted to Landlord a revised FF&E Reserve Estimate setting forth and explaining such departures. (e) Tenant, or Operator at the direction of Tenant, Tenant shall from time to time make expenditures from the Reserve as it deems necessary in accordance with Section 5.1.2(a) and (c). Tenant, or Operator at Tenant's direction, Tenant shall provide to Landlord, within twenty (20) days after the end of each Accounting Period, a statement setting forth Reserve expenditures made to date during the Fiscal Year. Expenditures from the Reserve shall not be subject to Landlord's approval. (f) All funds in the Reserve, all interest earned thereon and all property purchased with funds from the Reserve shall be and remain the property of Landlord and any such property purchased with funds from Tenant during the Reserve shall be part of the Leased Property and leased by Landlord to Tenant pursuant to this AgreementTerm. Following expiration or earlier termination of this Agreement and payment in full on all contracts entered into prior to such expiration or termination for work to be done or furniture, furnishings, fixtures and equipment to be supplied in accordance with this Section 5.1.2 out of the Reserve, Tenant's rights hereunder or under the Operating Agreement relating to the Reserve and property purchased with funds from the Reserve shall be transferred from Tenant to Landlord, subject to the provisions of the Operating Agreement if applicable. (g) It is understood and agreed that during the term of the Pooling Agreement, the Reserve pursuant to this Agreement shall (i) also serve as the reserve, and be pooled with the Reserves, under the Other Leases in accordance with the provisions of the Pooling Agreement, and (ii) include amounts transferred to the Reserve under this Agreement and the Other Leases. (h) If Landlord wishes to grant a security interest in or create another encumbrance on the rights of Landlord with respect to the Reserve, the instrument granting such security interest or creating such other encumbrance shall expressly provide that such security interest or encumbrance is subject to the rights of Tenant with respect to the Reserve as set forth herein and the rights of the Operator pursuant to the Operating Agreement during the term of the Operating Agreementherein. The form and substance of such provision shall be subject to obtaining Tenant's prior written approval, which approval shall not be unreasonably withheld, delayed or conditioned.

Reserve. (a) Tenant, or Operator at Tenant's direction, 5.2.1 Landlord shall establish an interest bearing reserve account (the "“Reserve"”) in CNLBank or such other a bank designated by Tenant, or Operator at the direction of Tenant, and reasonably approved by Landlord. All interest earned on the funds in the Reserve shall be added to and remain a part of the Reserve. Except Both Tenant and Landlord shall be signatories on the Reserve and both parties approval shall be required prior to a party making a withdrawal from the Reserve. Notwithstanding the foregoing, so long as set forth in Section 5.1.2(eno Tenant Event of Default has occurred and is continuing, Tenant shall be permitted to withdraw funds from the Reserve without Landlord’s prior approval (but with written notice to Landlord), Tenantso long as the withdrawn funds are for projects to be funded from the Reserve pursuant to the Reserve Budget and the amounts withdrawn are consistent with such budget. Further, or Operator if so required by upon the Operating Agreement or designated by Tenantoccurrence and continuance of an Event of Default, only Landlord’s approval shall be the only party entitled required to withdraw funds from the Reserve. Such account shall be established in Landlord’s name and control for the purposes set forth in this Lease. The purpose of the Reserve is to cover the cost of:of the following, to the extent carried out in accordance with this Lease (collectively, “Reserve Expenditures”): (ia) Replacements replacements (including P&E Replacements) and renewals and additions to the Facility's FF&EP&E located at the Land or used in connection with the Business (other than food and beverages located at any restaurant operated in connection with the Business); andand Batesville Healthcare Center Batesville, Arkansas (iib) Certain routine repairs and maintenance repairs, alterations (including any Permitted Renovations contemplated by Section 6.2 hereof, subject to the Facility building (provisions of Section 6.2.2 hereof), improvements, renewals, replacements and additions, whether routine, non routine or major, to the Leased Improvements, including without limitation, those required in order to cause the Leased Property to comply with Applicable Laws and those which are normally capitalized under GAAP) GAAP such as exterior renovations, alterations, improvements, renewals, replacements and interior repaintingadditions (but not ordinary maintenance or repair) to (i) any structures, resurfacing building including bearing walls, floorsfoundations, exterior facades, interior walls, roofs and parking areasceilings, any mechanical, electrical, heating, ventilating, air conditioning, plumbing and vertical transportation elements of the Leased Improvements, and replacing folding walls all other related improvements and facilities; and (ii) signage, storm drain system, parking lot and related facilities and all other related improvements and facilities, which expenditures Tenant reasonably believes should be made for the like, but which are not Capital ExpendituresLeased Property for the following Fiscal Year in order to maintain the Leased Property in a commercially reasonable condition consistent with the standard of operation for the Business required herein. (bc) Commencing In accordance with the Commencement Date and continuing throughout terms of Section 4.2.2 hereof, any abatement, management, cleanup, removal or remediation work with respect to any Hazardous Substances, including, without limitation any HUD Materials. 5.2.2 On or before the Term, Tenant shall transfer, or shall direct Operator to transfer tenth (as of 10th) Business Day following the end of each Accounting Period of during the Term)Term hereof, Tenant shall transfer into the Reserve an amount equal to the Applicable Percentage one twelfth (1/12) of Total Facility Revenues for such Accounting Period. (c) Tenant, or Operator at the direction of Tenant, shall (endeavoring in good faith to comply with the applicable Reserve Estimate, unless there has been a change in circumstance from time to time) make such expenditures for the replacements, renewals, repairs, and maintenance described in this Section 5.1.2, as Tenant, or Operator if the Operating Agreement is in effect, deems necessary, up to the balance in the Reserve in order to maintain Payment. The term “Reserve Payment” shall mean FIFTY-EIGHT THOUSAND AND NO/100 DOLLARS ($58,000.00) per annum during the Retirement Community consistent with period commencing on the Effective Date and ending on December 31, 2013, and, thereafter, on the first (i1st) industry standards if the Operating Agreement is not in effect or (ii) the standards required by the Operating Agreement if the Operating Agreement is in effect, and in conformity with Legal Requirements. No expenditures will be made in excess of said balance without the approval of Landlord. In addition, Tenant, or Operator at the direction of Tenant, shall not, without Landlord's approval, make any expenditures from the Reserve that, in the aggregate, exceed the total aggregate amount of expenditures set forth in the then-applicable Reserve Estimate; provided, however, that Tenant, or Operator at the direction of Tenant, shall be authorized to take appropriate remedial action (including making any necessary expenditures from the Reserve above the total aggregate amount set forth in the then-applicable Reserve Estimate), without receiving Landlord's prior approval, to remedy or respond to any of the Emergency Requirements (provided further that Tenant, or Operator at the direction of Tenant, shall notify Landlord of any such remedial action that requires more than a de minimus expenditure of funds from the Reserve). At the end day of each Fiscal Year, any amounts remaining the Reserve Payment shall be increased by three percent (3%) per annum. Notwithstanding anything to the contrary in this Section 5.2.2, in the event that an amount different than the Reserve Payment set forth above is set forth in a Reserve Budget, or a greater amount is required by the lender holding the first Mortgage on the Facility, then the Reserve Payment shall be carried forward to the next Fiscal Year. Proceeds from the sale of FF&E no longer necessary to the operation of the Retirement Community shall be deposited in the Reservesuch different or greater amount, as shall any interest which accrues on amounts placed in the Reserve. Neither: (x) proceeds from the disposition of FF&E; nor (y) interest which accrues on amounts held in the Reserve, shall result in any reduction in the required Reserve payments or be included in Total Facility Revenues. Upon a sale of the Retirement Community, funds in the Reserve will not be affected, and all dispositions of such funds (both before and after such Sale of the Retirement Community) will continue to be made exclusively pursuant to the provisions of this Agreement or the Operating Agreement if applicable. Tenant, or Operator at the direction of Tenant, is authorized to lease (rather than purchase) shuttle vans, postal machines, photocopiers and other office equipment. If Tenant, or Operator at the direction of Tenant, enters into a lease described in the preceding sentence, Tenant, or Operator at the direction of Tenant, shall give Landlord Notice of such lease either prior to or promptly after entering into such lease. Lease payments with respect to such leases shall be paid from the Reservecase may be. (d) Tenant, or Operator at the direction of Tenant, shall prepare an estimate (the "Reserve Estimate") of Reserve expenditures anticipated during the ensuing Fiscal Year and shall submit such Reserve Estimate to Landlord. Tenant or Operator, as applicable, will endeavor to follow the applicable FF&E Estimate, but shall be entitled to depart therefrom, in its reasonable discretion, provided that: (A) such departures from the applicable FF&E Estimate result from circumstances which could not reasonably have been foreseen at the time of the submission of such FF&E Estimate; and (B) such departures from the applicable FF&E Estimate result from circumstances which require prompt repair and/or replacement or are necessary to comply with Legal Requirements; and (C) Tenant or Operator, as applicable, has submitted to Landlord a revised FF&E Estimate setting forth and explaining such departures. (e) Tenant, or Operator at the direction of Tenant, shall from time to time make expenditures from the Reserve as it deems necessary in accordance with Section 5.1.2(a) and (c). Tenant, or Operator at Tenant's direction, shall provide to Landlord, within twenty (20) days after the end of each Accounting Period, a statement setting forth Reserve expenditures made to date during the Fiscal Year. Expenditures from the Reserve shall not be subject to Landlord's approval. (f) All funds in the Reserve, all interest earned thereon and all property purchased with funds from the Reserve shall be and remain the property of Landlord and any such property purchased with funds from the Reserve shall be part of the Leased Property and leased by Landlord to Tenant pursuant to this Agreement. Following expiration or earlier termination of this Agreement and payment in full on all contracts entered into prior to such expiration or termination for work to be done or furniture, furnishings, fixtures and equipment to be supplied in accordance with this Section 5.1.2 out of the Reserve, Tenant's rights hereunder or under the Operating Agreement relating to the Reserve shall be transferred from Tenant to Landlord, subject to the provisions of the Operating Agreement if applicable. (g) It is understood and agreed that during the term of the Pooling Agreement, the Reserve pursuant to this Agreement shall (i) also serve as the reserve, and be pooled with the Reserves, under the Other Leases in accordance with the provisions of the Pooling Agreement, and (ii) include amounts transferred to the Reserve under this Agreement and the Other Leases. (h) If Landlord wishes to grant a security interest in or create another encumbrance on the rights of Landlord with respect to the Reserve, the instrument granting such security interest or creating such other encumbrance shall expressly provide that such security interest or encumbrance is subject to the rights of Tenant with respect to the Reserve as set forth herein and the rights of the Operator pursuant to the Operating Agreement during the term of the Operating Agreement. The form and substance of such provision shall be subject to obtaining Tenant's prior written approval, which approval shall not be unreasonably withheld, delayed or conditioned.

Reserve. (a) Tenant, or Operator at Tenant's direction, Landlord shall establish an interest bearing reserve account in the name of Landlord naming Landlord’s and Tenant’s designee(s) as authorized signatories (the "“Reserve"”) in CNLBank or such other a bank designated by Landlord and approved by Tenant, or Operator at the direction such other type of Tenant, and reasonably investment account as may be approved by LandlordTenant (which approval, in each case, shall not be unreasonably withheld, conditioned or delayed). All interest earned on the Reserve shall be added to and remain a part of the Reserve. Except as set forth in Section 5.1.2(e), Tenant, or Operator if so required by the Operating Agreement or designated by Tenant, shall be the only party entitled to withdraw funds from the Reserve. The purpose of the Reserve is to cover the cost ofof the following, including lease or rent payments under any capital lease in connection with the same, which decision to lease and payment amount have been approved by Landlord, which approval shall not be unreasonably withheld, conditioned or delayed: (i) Replacements Replacements, renewals and renewals additions to the Facility's FF&E; andResort Personal Property and the furniture, furnishings, fixtures and equipment on the Leased Property; (ii) Certain routine repairs Repairs, renovations, renewals, additions, alterations, improvements or replacements and maintenance to the Facility building (Leased Property and the Resort Personal Property, all of which are routine or non-major and which are normally capitalized under GAAP) such as , or which have historically been capitalized by Tenant prior to any change in GAAP during the Term of this Agreement, including, without limitation, exterior and interior repainting, resurfacing building walls, floors, roofs and roofs, parking areas, and replacing folding walls equipment used in the operation of the Resort Personal Property and the likeLeased Property; and (iii) Repairs, but alterations, improvements, renewals, replacements and additions, all of which are non-routine or major, to the Leased Improvements and the Resort Personal Property which are not covered under Sections 5.1.2(a)(i) or 5.1.2(a)(ii) above and which are normally capitalized under GAAP, or which have historically been capitalized by Tenant prior to any change in GAAP during the Term of this Agreement, including, without limitation, repairs, alterations, improvements, renewals, replacements and additions to the structure, the exterior facade, the mechanical, electrical, heating, ventilating, air conditioning, plumbing and vertical transportation elements of the Leased Improvements (“Major Capital Expenditures”). Major Capital Expenditures shall also include all costs associated with any removal or remediation of Hazardous Materials regardless of whether such costs are normally capitalized under GAAP. (iv) the cost of lease or rent payments under any capital lease set forth on attached Schedule 5.1.2(a)(iv) or otherwise approved by Landlord in Landlord’s sole and absolute discretion (each an "Approved Capital Lease"). If, 1240817 during the Term of this Agreement Tenant shall acquire title to any property which is the subject of an Approved Capital Lease, Tenant shall, upon Landlord's election, transfer title to such property to Landlord (or, at Landlord's election, Landlord’s designee). If, during the Term of this Agreement, Tenant shall be entitled to acquire title to any property which is the subject of an Approved Capital Lease, Tenant shall provide written notice to Landlord thirty (30) days prior to the vesting of Tenant's right to take title to such property, and: (i) if the underlying Approved Capital Lease permits title to such property to be vested directly in a third party, Tenant shall, upon Landlord's election, cause title to such property to be vested in Landlord (or, at Landlord's election, Landlord’s designee); (ii) if the underlying Approved Capital Lease neither prohibits nor expressly permits title to such property to be vested directly in a third party, Tenant shall, upon Landlord's election, use commercially reasonable efforts to cause title to such property to be vested in Landlord (or, at Landlord's election, Landlord’s designee); and (iii) in all other cases, including if the underlying Approved Capital Lease expressly prohibits Tenant from causing title to such property to be vested directly in a third party, Tenant shall, at Landlord's election, acquire title to such property and transfer of title to such property to Landlord (or, at Landlord's election, Landlord’s designee). (b) Commencing For the period commencing with the Commencement Date and continuing throughout the Termending December 31, 2009, (i) Tenant shall transfer, or shall direct Operator to transfer (as of the end of each Accounting Period Fiscal Quarter) into the Reserve an amount equal to one-fourth (1/4th) of the Applicable Reserve Amount, and (ii) at the time Tenant provides Landlord the periodic financial statements described in Section 17.2 hereof, Tenant shall also deliver to Landlord a statement setting forth the total amount of deposits made to and expenditures from the Reserve for the preceding Fiscal Quarter. For the period commencing January 1, 2010 and continuing throughout the Term), (i) not later than ten (10) days following the end of each Accounting Period, Tenant shall transfer into the Reserve an amount equal to the Applicable Percentage Reserve Amount for the immediately preceding Accounting Period, and (ii) at the time Tenant provides Landlord the periodic financial statements described in Section 17.2 hereof, Tenant shall also deliver to Landlord a statement setting forth the total amount of Total Facility Revenues deposits made to and expenditures from the Reserve for such the preceding Accounting Period. (c) Tenant, or Operator at the direction of Tenant, shall Not later than sixty (endeavoring in good faith 60) days prior to comply with the applicable Reserve Estimate, unless there has been a change in circumstance from time to time) make such expenditures for the replacements, renewals, repairs, and maintenance described in this Section 5.1.2, as Tenant, or Operator if the Operating Agreement is in effect, deems necessary, up to the balance in the Reserve in order to maintain the Retirement Community consistent with (i) industry standards if the Operating Agreement is not in effect or (ii) the standards required by the Operating Agreement if the Operating Agreement is in effect, and in conformity with Legal Requirements. No expenditures will be made in excess of said balance without the approval of Landlord. In addition, Tenant, or Operator at the direction of Tenant, shall not, without Landlord's approval, make any expenditures from the Reserve that, in the aggregate, exceed the total aggregate amount of expenditures set forth in the then-applicable Reserve Estimate; provided, however, that Tenant, or Operator at the direction of Tenant, shall be authorized to take appropriate remedial action (including making any necessary expenditures from the Reserve above the total aggregate amount set forth in the then-applicable Reserve Estimate), without receiving Landlord's prior approval, to remedy or respond to any of the Emergency Requirements (provided further that Tenant, or Operator at the direction of Tenant, shall notify Landlord of any such remedial action that requires more than a de minimus expenditure of funds from the Reserve). At the end of each Fiscal Year, any amounts remaining in the Reserve shall be carried forward to the next Fiscal Year. Proceeds from the sale of FF&E no longer necessary to the operation of the Retirement Community shall be deposited in the Reserve, as shall any interest which accrues on amounts placed in the Reserve. Neither: (x) proceeds from the disposition of FF&E; nor (y) interest which accrues on amounts held in the Reserve, shall result in any reduction in the required Reserve payments or be included in Total Facility Revenues. Upon a sale of the Retirement Community, funds in the Reserve will not be affected, and all dispositions of such funds (both before and after such Sale of the Retirement Community) will continue to be made exclusively pursuant to the provisions of this Agreement or the Operating Agreement if applicable. Tenant, or Operator at the direction of Tenant, is authorized to lease (rather than purchase) shuttle vans, postal machines, photocopiers and other office equipment. If Tenant, or Operator at the direction of Tenant, enters into a lease described in the preceding sentence, Tenant, or Operator at the direction of Tenant, shall give Landlord Notice of such lease either prior to or promptly after entering into such lease. Lease payments with respect to such leases shall be paid from the Reserve. (d) Tenant, or Operator at the direction of Tenant, Tenant shall prepare an estimate (the "“Reserve Estimate"”) of Reserve expenditures anticipated during the ensuing Fiscal Year (a “Reserve Estimate Year”) and shall submit such Reserve Estimate to Landlord. Tenant or Operator, as applicable, will endeavor to follow the applicable FF&E Estimate, but shall be entitled to depart therefrom, in Landlord for its reasonable discretion, provided that: approval (A) such departures from the applicable FF&E Estimate result from circumstances which could not reasonably have been foreseen at the time of the submission of such FF&E Estimate; and (B) such departures from the applicable FF&E Estimate result from circumstances which require prompt repair and/or replacement or are necessary to comply with Legal Requirements; and (C) Tenant or Operator, as applicable, has submitted to Landlord a revised FF&E Estimate setting forth and explaining such departures. (e) Tenant, or Operator at the direction of Tenant, shall from time to time make expenditures from the Reserve as it deems necessary in accordance with Section 5.1.2(a) and (c). Tenant, or Operator at Tenant's direction, shall provide to Landlord, within twenty (20) days after the end of each Accounting Period, a statement setting forth Reserve expenditures made to date during the Fiscal Year. Expenditures from the Reserve shall not be subject to Landlord's approval. (f) All funds in the Reserve, all interest earned thereon and all property purchased with funds from the Reserve shall be and remain the property of Landlord and any such property purchased with funds from the Reserve shall be part of the Leased Property and leased by Landlord to Tenant pursuant to this Agreement. Following expiration or earlier termination of this Agreement and payment in full on all contracts entered into prior to such expiration or termination for work to be done or furniture, furnishings, fixtures and equipment to be supplied in accordance with this Section 5.1.2 out of the Reserve, Tenant's rights hereunder or under the Operating Agreement relating to the Reserve shall be transferred from Tenant to Landlord, subject to the provisions of the Operating Agreement if applicable. (g) It is understood and agreed that during the term of the Pooling Agreement, the Reserve pursuant to this Agreement shall (i) also serve as the reserve, and be pooled with the Reserves, under the Other Leases in accordance with the provisions of the Pooling Agreement, and (ii) include amounts transferred to the Reserve under this Agreement and the Other Leases. (h) If Landlord wishes to grant a security interest in or create another encumbrance on the rights of Landlord with respect to the Reserve, the instrument granting such security interest or creating such other encumbrance shall expressly provide that such security interest or encumbrance is subject to the rights of Tenant with respect to the Reserve as set forth herein and the rights of the Operator pursuant to the Operating Agreement during the term of the Operating Agreement. The form and substance of such provision shall be subject to obtaining Tenant's prior written approval, which approval shall not be unreasonably withheld, delayed conditioned or conditioned.delayed). Following Tenant’s submittal of such Reserve Estimate, Tenant may submit to Landlord any changes Tenant reasonably desires to the Reserve Estimate, and Landlord agrees to not unreasonably withhold, condition or delay its consent to any change to such Reserve Estimate requested by Tenant. The Reserve Estimate budget approved by Landlord for each Reserve Estimate Year may include a separate discretionary line item equivalent to ten percent (10%) of the projected contributions by Tenant into the Reserve for such Reserve Estimate Year which Tenant shall be entitled to expend, in its discretion, for items that are appropriately to be funded with Reserve funds pursuant to this 1240817

Reserve. (a) Tenant5.2.1 On or before the Effective Date, or Operator at Tenant's direction, Tenant shall establish an a segregated interest bearing reserve account (the "“Reserve"”) in CNLBank or such other a bank designated by Tenant, or Operator at the direction of Tenant, Tenant and reasonably approved by Landlord. All interest earned on the funds in the Reserve shall be added to and remain a part of the Reserve. Except as set forth in Section 5.1.2(e), Tenant, or Operator if so required by the Operating Agreement or designated by Tenant, Both Tenant and Landlord shall be signatories on the Reserve; provided, however, that only party entitled one signature shall be required to withdraw funds and Landlord agrees that so long as there is no uncured Event of Default hereunder, Landlord shall not be required to sign on any checks and Landlord shall not withdraw any funds from such account. During the Reserveexistence of any uncured Event of Default hereunder, the Tenant signatory party shall no longer be an authorized signatory on the Reserve account. Such account shall be established in Landlord’s name and control for the benefit of Tenant and shall not include or contemplate “overdraft protection” and Tenant shall not request or attempt to draw or draft any funds which are not actually on deposit in such Reserve account. The purpose of the Reserve is to cover the cost of:of the following, to the extent carried out in accordance with this Lease (collectively, “Reserve Expenditures”): (ia) Replacements replacements (including P&E Replacements) and renewals to the Facility's FF&E; andAttractions Personal Property and P&E located at the Land or used in connection with the Business (other than food and beverages located at any restaurant operated in connection with the Business). (iib) Certain replacements and renewals, whether routine, non routine repairs and maintenance or major, to the Facility building (Leased Property and the Attractions Personal Property, including without limitation, those which are normally capitalized under GAAP) GAAP such as exterior replacements and interior repainting, resurfacing building renewals to any structures or buildings (including bearing walls, floorsfoundations, exterior facades, interior walls, roofs and parking areasceilings), any mechanical, electrical, heating, ventilating, air conditioning, plumbing and vertical transportation elements of the Leased Improvements, any rides, water slides and other attractions equipment, or any part or portion thereof, and replacing folding walls all other related equipment, improvements and facilities, and signage, storm drain system, parking lot and related facilities and all other related improvements and facilities, which expenditures Tenant and Landlord reasonably believe should be made for the like, but which are not Capital ExpendituresLeased Property for the following Fiscal Year in order to maintain the Leased Property in accordance with Theme Park System Standards to comply with Legal Requirements or Applicable Laws. (bc) maintenance and repairs to the Leased Property resulting from conditions existing as of the Effective Date; provided the same shall not apply to maintenance and repairs necessary or required to the extent exacerbated by Tenant’s use of the Leased Property. 5.2.2 Commencing with the Commencement Effective Date and continuing throughout the Term, Tenant shall transfer, or shall direct Operator to transfer (as of on the end last day of each Accounting Period of during the Term), transfer into the Reserve an amount equal to the Applicable Reserve Percentage for such Accounting Period (based upon estimates of Total Facility Revenues for if necessary, to be adjusted as soon as Tenant has had an opportunity to confirm actual Total Facility Revenues, but in no event later than seven (7) Business Days after the end of such Accounting Period. (c) Tenant, or Operator at ). At the direction of Tenant, shall (endeavoring in good faith to comply with time Tenant provides Landlord the applicable Reserve Estimate, unless there has been a change in circumstance from time to time) make such expenditures for the replacements, renewals, repairs, and maintenance Annual Operations Statement described in this Section 5.1.23.3.2, as Tenant, or Operator if Tenant shall also deliver to Landlord a statement setting forth the Operating Agreement is in effect, deems necessary, up total amount of deposits made to the balance in the Reserve in order to maintain the Retirement Community consistent with (i) industry standards if the Operating Agreement is not in effect or (ii) the standards required by the Operating Agreement if the Operating Agreement is in effect, and in conformity with Legal Requirements. No expenditures will be made in excess of said balance without the approval of Landlord. In addition, Tenant, or Operator at the direction of Tenant, shall not, without Landlord's approval, make any expenditures from the Reserve that, in for the aggregate, exceed the total aggregate amount of expenditures set forth in the then-applicable Reserve Estimate; provided, however, that Tenant, preceding Fiscal Year. 5.2.3 On or Operator at the direction of Tenant, shall be authorized to take appropriate remedial action (including making any necessary expenditures from the Reserve above the total aggregate amount set forth in the then-applicable Reserve Estimate), without receiving Landlord's prior approval, to remedy or respond to any of the Emergency Requirements (provided further that Tenant, or Operator at the direction of Tenant, shall notify Landlord of any such remedial action that requires more than a de minimus expenditure of funds from the Reserve). At the end before October 31 of each Fiscal Year, any amounts remaining in the Reserve shall be carried forward to the next Fiscal Year. Proceeds from the sale of FF&E no longer necessary to the operation of the Retirement Community shall be deposited in the Reserve, as shall any interest which accrues on amounts placed in the Reserve. Neither: (x) proceeds from the disposition of FF&E; nor (y) interest which accrues on amounts held in the Reserve, shall result in any reduction in the required Reserve payments or be included in Total Facility Revenues. Upon a sale of the Retirement Community, funds in the Reserve will not be affected, and all dispositions of such funds (both before and after such Sale of the Retirement Community) will continue to be made exclusively pursuant to the provisions of this Agreement or the Operating Agreement if applicable. Tenant, or Operator at the direction of Tenant, is authorized to lease (rather than purchase) shuttle vans, postal machines, photocopiers and other office equipment. If Tenant, or Operator at the direction of Tenant, enters into a lease described in the preceding sentence, Tenant, or Operator at the direction of Tenant, shall give Landlord Notice of such lease either prior to or promptly after entering into such lease. Lease payments with respect to such leases shall be paid from the Reserve. (d) Tenant, or Operator at the direction of Tenant, Tenant shall prepare an estimate (the "“Reserve Estimate"”) of Reserve expenditures Expenditures anticipated during the ensuing Fiscal Year and shall submit such Reserve Estimate to LandlordLandlord for its review. Such Reserve Estimate shall reflect by line item the projected budget for Reserve Expenditures for the Leased Property and assumptions on the basis of which such line items were prepared in narrative form if necessary, including separate budget items for all projected expenditures for replacements, substitutions and additions to Tenant’s Personal Property. Tenant shall provide to Landlord reasonable additional detail, information and assumptions used in the preparation of the Reserve Estimate as requested by Landlord and shall also submit to Landlord with the Reserve Estimate good faith longer range projections of planned Reserve Expenditures for an additional three (3) Fiscal Years. Tenant shall review the Reserve Estimate with Landlord, and subject to Landlord’s approval, Tenant shall implement such Reserve Estimate for the successive Fiscal Year (during which it shall, if approved by Landlord, be referred to as the “Approved Reserve Estimate”). In addition, Landlord shall have the right to reasonably disapprove any expenditures to be made pursuant to the Reserve Estimate which are not in compliance with Applicable Laws. Further, Landlord’s approval of any expenditure pursuant to the Reserve Estimate shall not be, or Operatorbe deemed to be, an assumption by Landlord of any liability in connection with the expenditures made. Pending resolution of any dispute, the specific disputed item of the Reserve Estimate shall be suspended and replaced for the Fiscal Year in question by an amount equal to the lesser of (a) that proposed by Tenant for such Fiscal Year or (b) such budget item for the Fiscal Year prior thereto. Subject to the terms of this Section 5.2.3, Tenant shall not deviate from the Approved Reserve Estimate without the prior approval of Landlord, except in the case of Emergency where immediate action is necessary to prevent imminent danger to person or property (an “Emergency”). In such circumstances, Tenant shall use good faith efforts to obtain the approval of Landlord if practicable and if such efforts would not pose a risk to the condition of the Leased Property or harm to any person, and in any event provide notice to Landlord as applicablepromptly as possible of such expenditure, will endeavor to follow the applicable FF&E amount of and the reason for the same. 5.2.4 Tenant shall, consistent with the Approved Reserve Estimate, but shall be entitled to depart therefrom, in its reasonable discretion, provided that: (A) such departures from the applicable FF&E Estimate result from circumstances which could not reasonably have been foreseen at the time of the submission of such FF&E Estimate; and (B) such departures from the applicable FF&E Estimate result from circumstances which require prompt repair and/or replacement or are necessary to comply with Legal Requirements; and (C) Tenant or Operator, as applicable, has submitted to Landlord a revised FF&E Estimate setting forth and explaining such departures. (e) Tenant, or Operator at the direction of Tenant, shall from time to time make expenditures Reserve Expenditures from the Reserve as it reasonably deems necessary in accordance with Section 5.1.2(a) 5.2.1 and (c)Section 5.2.3. Tenant, or Operator at Tenant's direction, Tenant shall provide to Landlord, within twenty thirty (2030) days after the end of each Accounting Period, a an itemized statement setting forth Reserve expenditures Expenditures made to date during the Fiscal Year. . 5.2.5 In the event Reserve Expenditures from not otherwise provided for in the Approved Reserve Estimate are required (a) as a result of Legal Requirements, a Force Majeure Event and/or are otherwise required for the continued safe and orderly operation of the Leased Property and/or Attractions Personal Property, (b) due to an emergency threatening the Leased Property and/or Attractions Personal Property, its guests, invitees or employees, or (c) because the continuation of a given condition will subject Tenant or Landlord to civil or criminal liability (“Unforeseen Reserve Expenditures”), Tenant shall give Landlord Notice thereof, which Notice shall set forth in reasonable detail the nature of the Unforeseen Reserve Expenditures and the estimated cost thereof, and Landlord agrees that it shall not unreasonably withhold, condition or delay its approval of such Unforeseen Reserve Expenditures. 5.2.6 In the event funds in the Reserve shall not be subject insufficient, or are reasonably projected by Tenant to be insufficient for necessary and permitted Reserve Expenditures, including, without limitation, Unforeseen Reserve Expenditures as set forth under Section 5.2.5 hereof (collectively, “Unfunded Reserve Expenditures”), Tenant shall give Landlord Notice thereof, which Notice shall set forth in reasonable detail the nature of the Unfunded Reserve Expenditures and the estimated cost thereof, and Landlord's approval, in Landlord’s reasonable discretion, shall approve and fund the amount necessary to pay for such Unfunded Reserve Expenditures and the amounts so funded shall constitute part of Landlord’s Additional Investment. (f) 5.2.7 All funds in the Reserve, all interest earned thereon on the Reserve shall be added to and become a part thereof, and all property P&E Replacements purchased with funds from the Reserve shall be and remain the property of Landlord and any such property purchased with shall be treated as Leased Property pursuant to Section 2.1(e). All funds from in the Reserve shall be part and remain the property of Landlord or the Leased Personal Property and leased by Landlord to Tenant pursuant to this Agreement. Following Landlord, as applicable, throughout the Term and, following the expiration or earlier termination of this Agreement Lease, and payment in full on all contracts entered into prior to such expiration or termination for work to be done or furniture, furnishings, fixtures and equipment to be supplied in accordance with this Section 5.1.2 5.2 out of the Reserve, Tenant's rights hereunder or under the Operating Agreement relating to ownership of the Reserve shall be transferred from Tenant to vested in Landlord, subject to the provisions of the Operating Agreement if applicable. (g) . It is understood and agreed that during the term of the Pooling Agreement, the Reserve pursuant to this Agreement Lease shall (i) also serve as the reserve, be maintained and be pooled used solely in connection with the ReservesLeased Property. At the end of each Accounting Period, under any amounts remaining in the Other Leases in accordance with the provisions of the Pooling Agreement, and (ii) include amounts transferred Reserve shall be carried forward to the next Accounting Period, but Tenant shall not receive a credit for such remaining amounts against the Applicable Reserve under this Agreement and the Other LeasesPercentage to be deposited by Tenant in such next Accounting Period. (h) 5.2.8 If Landlord wishes to grant a security interest in or create another encumbrance on its interest in the rights Reserve in connection with a Facility Mortgage, all or any part of Landlord with respect to the Reserveexisting or future funds therein, or any general intangible in connection therewith, the instrument granting such security interest or creating such other encumbrance shall expressly provide that such security interest or encumbrance is subject prior in right to the rights of Tenant with respect to the Reserve as set forth herein and in accordance with the Non-Disturbance Agreement; provided that a default by Landlord under any Facility Mortgage shall not restrict, impede or inhibit the rights of Tenant in and to the Operator Reserve under this Lease so long as Tenant is not in default hereunder. 5.2.9 It is understood and agreed that in lieu of the provision set forth in this Lease governing the Reserve, the Reserve shall be maintained and used as set forth in the Pooling Agreement at such times as the Pooling Agreement applies to the Leased Property and the Attractions Personal Property pursuant to the Operating Agreement during the term of the Operating Agreement. The form and substance of such provision shall be subject to obtaining Tenant's prior written approval, which approval shall not be unreasonably withheld, delayed or conditionedits terms.