Common use of Tax Reserve Clause in Contracts

Tax Reserve. (a) Upon the request of Lender during the existence of any Event of Default, Borrower shall deposit with Lender a sum in an amount reasonably determined by Lender with respect to Impositions to be held by Lender in a Reserve Account (the “Tax Reserve Account”), and on each Payment Date thereafter, so long as such Event of Default is continuing, Borrower shall deliver to Lender the amount reasonably estimated by Lender to be one-twelfth (1/12th) of the annual amount of the Impositions to assure that funds are reserved in sufficient amounts to enable the payment of Impositions thirty (30) days prior to their respective due dates (provided, that Lender may re-calculate the foregoing monthly amount from time to time to assure that such funds are reserved in sufficient amounts to enable the payment of Impositions thirty (30) days prior to their respective due dates) (the “Tax Monthly Installment”). If such amounts for the then current Fiscal Year or payment period are not ascertainable by Lender at the time a monthly deposit is required to be made under this Section 4.2, the Tax Monthly Installment shall be Lender’s reasonable estimate based on one-twelfth (1/12th) of the Impositions for the prior Fiscal Year or payment period, with adjustments reasonably determined by Lender. As soon as the Impositions are fixed for the then current Fiscal Year or period, the next ensuing Tax Monthly Installment shall be adjusted to reflect any deficiency or surplus in prior Tax Monthly Installments. (b) If Lender has not elected, its sole discretion, during the continuance of an Event of Default to apply the funds in the Tax Reserve Account in payment of the Debt in such order and manner as Lender may elect, then Lender shall make payments of Impositions out of the Tax Reserve Account before the same shall be delinquent if and to the extent that there are funds available in the Tax Reserve Account. In making any payment relating to Impositions, Lender may do so according to any xxxx, statement or estimate procured from the appropriate public office (with respect to Impositions) without inquiry into the accuracy of such xxxx, statement or estimate or into the validity of any tax, assessment, sale, forfeiture, tax lien or title or claim thereof. Any funds remaining on deposit in the Tax Reserve Account when no Event of Defaults exist or after the Debt has been indefeasibly repaid in full, whichever is earlier, shall be promptly returned to Borrower.

Tax Reserve. (a) Upon Borrower shall cause Operator to establish and maintain at all times while this Agreement continues in effect a reserve (the request “Tax Reserve”) for payment of Lender during federal income Taxes and gaming Taxes arising from the existence operation of the New Card Rooms (“Federal Taxes” and “Gaming Taxes”, respectively) and for payment of real estate Taxes on the Mortgaged Properties (“Real Estate Taxes” and, together with Federal Taxes and Gaming Taxes, “Reserved Taxes”). The Tax Reserve shall be maintained in a segregated Deposit Account at the Account Bank opened in the name of Operator on or prior to the Effective Date solely for the purpose of this Section 7.1, which shall be subject to a Control Agreement. (b) Borrower shall, or shall cause Operator to, deposit in the Tax Reserve on or prior to the Effective Date twenty five percent (25%) of the average monthly Gaming Taxes and Real Estate Taxes estimated by Agent in its sole discretion prior to the Effective Date to be payable or, if not payable on a monthly basis, accrued, by Operator for that portion of the Fiscal Year beginning on the Effective Date and ending on April 30, 2011 (the “Initial Tax Reserve Deposit Amount”), for each New Card Room being purchased on the Effective Date. Prior to any Event of Defaultsubsequent Purchase Agreement Closing Date (if any), Borrower shall similarly deposit with Lender in the Tax Reserve the Initial Tax Reserve Deposit Amount for each New Card Room being purchased on that date. (c) Borrower shall, or shall cause Operator to further deposit in the Tax Reserve on a sum in monthly basis an amount reasonably determined by Lender additional amount: (i) during the first three (3) calendar months following the Effective Date or, with respect to Impositions those New Card Rooms purchased on any subsequent Purchase Agreement Closing Date (if any), following that date, an aggregate amount necessary to ensure that no later than the end of such three (3) calendar month period there is not less than one hundred percent (100%) of the average monthly Gaming Taxes and Real Estate Taxes estimated by Agent in its sole discretion prior to the Effective Date to be held payable by Lender Operator when initially due or, if not payable on a monthly basis, accrued for the immediately preceding calendar months; and (ii) for each subsequent calendar month, subject to Section 7.1(e): (A) no later than concurrently with Borrower’s delivery of monthly financial statements pursuant to Section 6.1(d) an amount necessary to reserve for one hundred percent (100%) of the Gaming Tax liabilities accrued and/or payable by Operator for the calendar month to which such financial statements relate based on the operational results for that calendar month set forth in such financial statements; and (B) the average monthly Real Estate Taxes estimated by Agent in its sole discretion prior to the Effective Date to ensure that there is not less than one hundred percent (100%) of Real Estate Taxes reserved in the Tax Reserve to pay Real Estate Taxes when initially due; provided that as soon as Borrower or Operator becomes aware of an increase in the Real Estate tax liability of Operator (whether by notice from Agent or otherwise), the Borrower or Operator shall increase the amount it pays into the Tax Reserve on a monthly basis commensurate with such increase. (d) Subject to Section 7.1(e), beginning with the first full calendar month following the Effective Date and the first full calendar month of any subsequent Fiscal Year, Borrower shall, or shall cause Operator to deposit in the Tax Reserve Account on a monthly basis no later than concurrently with Borrower’s delivery of monthly financial statements pursuant to Section 6.1(d) an amount necessary to provide for the payment when initially due of one hundred percent (100%) of Federal Income Taxes on the taxable income arising from the operations of the New Card Rooms as reflected in such monthly financial statements. In determining the monthly amounts required to be reserved under this Section 7.1(d), the Borrower will apply the then federal income tax rate applicable to the Operator to the taxable income arising from the operational results of the New Card Rooms for the applicable calendar month. (e) The aggregate required minimum balance of the Tax Reserve under this Section 7.1 (the “Tax Reserve AccountRequired Minimum Balance”)) may be (i) increased or decreased at any time, in Agent’s sole discretion, pursuant to a change in Law or in anticipation of a proposed change in Law that increases or decreases or would be reasonably likely to increase or decrease, as applicable, Operator’s liability for any Reserved Taxes and (ii) increased or decreased, in Agent’s sole discretion, not more than once every three (3) calendar months to the extent that the Agent determines that the actual operating results for any New Card Room or the New Card Rooms collectively, warrant an increase or decrease in the Tax Reserve Required Minimum Balance. To the extent that any adjusted Tax Reserve Required Minimum Balance determined by the Agent is higher than the then actual balance of the Tax Reserve, the Borrower shall cause the Operator to cure such deficiency promptly and in any event within thirty (30) days following notice to the Borrower of an adjustment made pursuant to sub-clause (i) or (ii) above. (f) Borrower shall, or shall cause Operator to, deposit in the Tax Reserve on each Interest Payment Date thereafterDate, so an aggregate amount sufficient to maintain the then effective Tax Reserve Required Minimum Balance for each of the New Card Rooms. (g) So long as such Event of no Default or Unmatured Default has occurred and is continuing, Borrower shall deliver cause Operator to Lender apply all amounts in the amount reasonably estimated Tax Reserve necessary to pay Reserved Taxes to the Governmental Authority directly (or indirectly through Parent to the extent permitted by Lender Section 6.25(b)) on or prior to the initial due date therefor. Borrower shall be one-twelfth responsible for ensuring the receipt by Agent, at least fifteen (1/12th) of the annual amount of the Impositions to assure that funds are reserved in sufficient amounts to enable the payment of Impositions thirty (3015) days prior to their respective the initial due dates (provided, that Lender may re-calculate the foregoing monthly amount from time to time to assure that such funds are reserved in sufficient amounts to enable the for payment of Impositions thirty (30) days prior to their respective due dates) (the “Tax Monthly Installment”). If such amounts Reserved Taxes, of all bills, invoices and statements for the then current Fiscal Year or payment period are not ascertainable by Lender at the time a monthly deposit is required all Reserved Taxes to be made under this Section 4.2, paid from the Tax Monthly Installment shall be Lender’s reasonable estimate based on one-twelfth (1/12th) of the Impositions for the prior Fiscal Year or payment period, with adjustments reasonably determined by Lender. As soon as the Impositions are fixed for the then current Fiscal Year or period, the next ensuing Tax Monthly Installment shall be adjusted to reflect any deficiency or surplus in prior Tax Monthly InstallmentsReserve. (bh) If Lender has not elected, its sole discretion, during the continuance of an Event of Default Any failure to apply the have sufficient funds in the Tax Reserve Account in payment of to pay all Reserved Taxes when initially due and payable shall not excuse any failure by Borrower or Operator to pay all such amounts at such time as otherwise required under this Agreement. (i) All interest and other proceeds paid on the Debt in such order and manner as Lender may elect, then Lender shall make payments of Impositions out of the Tax Reserve Account before the same shall be delinquent if and to the extent that there are funds available deposited in the Tax Reserve Account. In making any payment relating shall accrue to Impositionsthe benefit of Operator; provided, Lender may do so according however, that Borrower shall cause Operator to any xxxx, statement or estimate procured from the appropriate public office (with respect to Impositions) without inquiry into the accuracy of retain such xxxx, statement or estimate or into the validity of any tax, assessment, sale, forfeiture, tax lien or title or claim thereof. Any funds remaining on deposit amounts in the Tax Reserve Account when no Event of Defaults exist together with all other amounts from time to time in the Tax Reserve until applied to pay Reserved Taxes in accordance with this Section 7.1 or after the Debt has until all Obligations have been indefeasibly repaid Paid in full, whichever is earlier, shall be promptly returned Full or as otherwise consented to Borrowerin writing by Agent.

Tax Reserve. (a) Upon the request of Lender during the existence of any Event of Default, Borrower shall deposit (or cause to be deposited) with Lender a sum (or such agent of Lender as Lender may designate in an amount reasonably determined by Lender with respect writing to Impositions Borrower from time to be held by Lender in a Reserve Account (the “Tax Reserve Account”time), and monthly, on each Payment Date thereafterDate, so long as such Event of Default is continuing, Borrower shall deliver to Lender the amount reasonably estimated by Lender to be one-twelfth (1/12th) 1/12th of the annual amount charges (as estimated by Lender) for all Impositions relating to the Mortgaged Property. Borrower shall also deposit with Lender, simultaneously with such monthly deposits and/or on the Closing Date, a sum of the Impositions money which, together with such monthly deposits, will be sufficient to assure that funds are reserved in sufficient amounts to enable make the payment of Impositions each such charge at least thirty (30) days prior to their respective due dates (provided, that Lender may re-calculate the foregoing monthly amount from time to time to assure that date finally delinquent. Should such funds are reserved in sufficient amounts to enable the payment of Impositions thirty (30) days prior to their respective due dates) (the “Tax Monthly Installment”). If such amounts for the then current Fiscal Year or payment period are charges not be ascertainable by Lender at the time a monthly any deposit is required to be made under this Section 4.2made, the Tax Monthly Installment deposit shall be made on the basis of Lender’s reasonable estimate based on one-twelfth (1/12th) of estimate. When the Impositions for the prior Fiscal Year or payment period, with adjustments reasonably determined by Lender. As soon as the Impositions charges are fixed for the then current Fiscal Year year or period, the next ensuing Tax Monthly Installment Borrower shall be adjusted to reflect deposit any deficiency or surplus in prior Tax Monthly Installments. within fifteen (b15) If Lender has not electeddays following Lender’s demand, its sole discretionand to the extent there is any excess, during the continuance of such amount shall, upon written request, be returned to Borrower. Should an Event of Default to apply occur, the funds in the Tax Reserve Account so deposited may be applied in payment of the Debt in charges for which such order and manner funds shall have been deposited or to the payment of the Obligations or any other charges affecting the Mortgaged Property as Lender in its sole and absolute discretion may electdetermine, then but no such application shall be deemed to have been made by operation of law or otherwise until actually made by Lender as herein provided. Borrower shall make payments of Impositions out provide Lender with bills and all other documents necessary for the payment of the Tax Reserve Account before the same shall be delinquent if and foregoing charges at least ten (10) days prior to the extent that there are funds available in the Tax Reserve Accountdate on which each payment thereof shall first become delinquent. In making any payment relating to Impositions, Lender may do so according to any xxxx, statement or estimate procured from the appropriate public office So long as (with respect to Impositionsi) without inquiry into the accuracy of such xxxx, statement or estimate or into the validity of any tax, assessment, sale, forfeiture, tax lien or title or claim thereof. Any funds remaining on deposit in the Tax Reserve Account when no Event of Defaults exist Default exists, (ii) Borrower has provided Lender with the foregoing bills and other documents in a timely manner, and (iii) sufficient funds are held by Lender for the payment of such charges, as applicable, Lender shall pay said items or after the Debt has been indefeasibly repaid in full, whichever is earlier, allow such funds to be released to Borrower for it to pay said items. All refunds of Impositions shall be promptly returned to Borrowerdeposited into the tax Reserve.

Tax Reserve. In connection with the closing of the modification of the Loan contemplated by this Agreement and, as a condition precedent to the effectiveness of this Agreement, Borrower is depositing Fifty Thousand and No/100 Dollars (a$50,000.00) Upon in the request of Interest and Tax Reserve Account. Borrower will use such funds solely to pay the real estate taxes, assessments and charges against the Property as said taxes come due. Borrower will submit to Lender during an invoice evidencing the existence amount of any Event of Defaultpayment for real estate taxes, Borrower shall deposit with Lender a sum in an amount reasonably determined by Lender assessments or charges due with respect to Impositions to be held by Lender in a Reserve Account the Property and the purpose of such payment not less than ten (the “Tax Reserve Account”), and on each Payment Date thereafter, so long as such Event of Default is continuing, Borrower shall deliver to Lender the amount reasonably estimated by Lender to be one-twelfth (1/12th10) of the annual amount of the Impositions to assure that funds are reserved in sufficient amounts to enable the payment of Impositions thirty (30) business days prior to their respective due dates (provideddate such real estate taxes, that Lender assessments or charges are due. Upon Lender’s written consent, Borrower may re-calculate withdraw funds from the foregoing monthly amount from time Interest and Tax Reserve Account to time to assure that such funds are reserved in sufficient amounts to enable the be used solely for payment of Impositions thirty (30) days prior to their respective due dates) (the “Tax Monthly Installment”). If such amounts for the then current Fiscal Year or payment period are not ascertainable by Lender at the time a monthly deposit is required to be made under this Section 4.2taxes, the Tax Monthly Installment shall be Lender’s reasonable estimate based on one-twelfth (1/12th) of the Impositions for the prior Fiscal Year or payment periodassessments, with adjustments reasonably determined by Lender. As soon as the Impositions are fixed for the then current Fiscal Year or periodcharges, the next ensuing Tax Monthly Installment shall be adjusted to reflect any deficiency or surplus or, in prior Tax Monthly Installments. (b) If Lender has not elected, its sole discretion, during Lender may use funds from the continuance Interest and Tax Reserve Account to pay the applicable taxing authority directly. Borrower will pay prior to any delinquency date thereof all real estate taxes, assessments and charges against the Property regardless of an Event the timing or amount of Default to apply the funds in the Interest and Tax Reserve Account in payment of the Debt in such order Account, and manner as Lender may elect, then Lender shall make payments of Impositions out of the Tax Reserve Account before the same it is understood and agreed that Borrower shall be delinquent if obligated to pay, from its own funds, all real estate taxes, assessments and to charges against the extent Property in the event that there are funds the assessed amounts of such taxes or charges exceed the amount available in the Interest and Tax Reserve Account. In making All interest earned on the funds deposited in the Interest and Tax Reserve Account shall become part of Borrower’s deposit. Borrower agrees that it shall include all interest and earnings on any payment relating to Impositionssuch deposit as its income (and, Lender if Borrower is a partnership or other pass-through entity, the income of its partners, members or beneficiaries, as the case may do so according to any xxxxbe), statement or estimate procured from and shall be the appropriate public office (with respect to Impositions) without inquiry into the accuracy owner of such xxxx, statement or estimate or into the validity of any tax, assessment, sale, forfeiture, tax lien or title or claim thereof. Any all funds remaining on deposit in the Interest and Tax Reserve Account when for federal and applicable state and local tax purposes. Lender shall have the exclusive right to manage and control all funds in the Interest and Tax Reserve Account, and Borrower shall not have any right to withdraw funds from the Interest and Tax Reserve Account without Lender’s consent, which may be withheld in Lender’s sole and complete discretion. Lender shall have no Event fiduciary duty with respect to such funds and will not be liable to Borrower for any expense, claim, loss, damage or cost (“Damages”) arising out of Defaults exist or after relating to its holding of any funds held in the Debt Interest and Tax Reserve Account other than those Damages which result directly from its Lender’s gross negligence or willful misconduct. Any account fees and charges may be deducted from the balance, if any, in the Interest and Tax Reserve Account. Borrower has been indefeasibly repaid previously granted, and does hereby grant, to Lender a security interest in fullthe Interest and Tax Reserve Account and all such funds deposited at any time into such deposit account, whichever is earlierand any proceeds thereof, as security for the Obligations (as defined in the Security Deed). Such security interest shall be promptly returned governed by the Uniform Commercial Code of the State of Georgia, and Lender shall have available to Borrowerit all of the rights and remedies available to a secured party thereunder. The Interest and Tax Reserve Account may be established and held in such name or names as Lender shall deem appropriate, including in the name of Lender. Borrower hereby constitutes and appoints Lender and any officer or agent of Lender its true and lawful attorneys-in-fact with full power of substitution to open the Interest and Tax Reserve Account and to do any and every act that Borrower might do on its own behalf to fulfill the terms of this Section 9. Borrower hereby ratifies all that said attorneys shall lawfully do or cause to be done by virtue hereof. It is understood and agreed that this power of attorney, which shall be deemed to be a power coupled with an interest, cannot be revoked.