Common use of Mandatory Borrowing Clause in Contracts

Mandatory Borrowing. Subject to Section 10.14, notwithstanding anything to the contrary contained herein, and provided that the Lender has not commenced exercise of its cumulative rights and remedies following an Event of Default, the Borrower must borrow the Twelve Million and 00/100 Dollars ($12,000,000.00) on or before the last day of the Interest Only Period (defined in the Construction Note). In the event that the Borrower completes construction for less than the Project Budget, it is still required to draw down the unused portion of the Loan which shall be held in an interest bearing cash collateral account with the Lender (the “Reserve Account”). The Borrower, provided no Event of Default has occurred, may use the Reserve Account following the first anniversary of the date hereof, to pay its monthly principal obligations to the Lender under the Construction Note.