Common use of Debt Service Reserve Clause in Contracts

Debt Service Reserve. (a) The HoldCo Borrower agrees that all amounts deposited into the Debt Service Account from time to time shall be applied in accordance with Section 3.05 of the Security Agreement. If on the last day of any calendar quarter or upon the occurrence of any Business Interruption Period, the amount in the Debt Service Account is less than the Debt Service Reserve Amount at such time (including as a result of a Business Interruption Period), the HoldCo Borrower shall promptly cause amounts to be transferred into the Debt Service Account to the extent required so that the amount in the Debt Service Account is at least equal to the Debt Service Reserve Amount. In the event that the HoldCo Borrower fails to so deposit any such amounts, subject to Section 3.04(d) of the Security Agreement and to the terms of the NBA Consent Letter in each event, any or all amounts deposited into the Distribution Account shall be transferred into the Debt Service Account to the extent required so that the amount in the Debt Service Account is equal to at least the Debt Service Reserve Amount. At the HoldCo Borrower’s request, the Agent shall release to the HoldCo Borrower amounts from the Debt Service Account to the extent of any excess above the Debt Service Reserve Amount at such time, provided that no Event of Default is continuing. Any amounts remaining in the Debt Service Account on the earlier of the Maturity Date and the date that all of the Commitments are terminated, other than any such amounts required to be utilized for the payment of principal or interest on Loans or other amounts then due and payable hereunder by the HoldCo Borrower, shall be released to the HoldCo Borrower, provided that no Event of Default is continuing.

Debt Service Reserve. On the Closing Date, Borrower shall deposit with Lender an amount equal to Five Million Two Hundred Fifty Thousand Dollars (a$5,250,000) (said amount, hereinafter, the “Debt Service Reserve Fund,” and the account in which such amount is held, hereinafter, the “Debt Service Reserve Account”) for the purpose of funding an escrow fund for the payment of Debt Service and any other amounts due under this Agreement and the other Loan Documents. On each Payment Date occurring on and after the first (1st) anniversary of the first (1st) Payment Date, Lender shall apply the Debt Service Reserve Fund in an amount equal to the Monthly Debt Service Payment Amount, which amount shall be deposited into the Cash Management Account for disbursement in accordance therewith, provided that, as of each such Payment Date, the Debt Service Coverage Ratio for the Properties for the immediately preceding twelve (12) month period shall be equal to or greater than 1.65 to 1.0. The HoldCo insufficiency of any balance in the Debt Service Reserve Account shall not relieve Borrower agrees from its obligation to pay Debt Service and any other amounts as required under this Agreement and the other Loan Documents. In lieu of making the deposit (or any portion thereof) to the Debt Service Reserve Account required pursuant to this Section 7.5.1, Borrower may deliver to Lender an irrevocable letter of credit (payable on sight draft only) in an amount equal to the amount that all amounts is otherwise required to be deposited into the Debt Service Reserve Account from time to time issued by a domestic financial institution having a rating by S&P and Fitch of not less than “AA” and “Aa2” by Xxxxx’x if the term of such letter of credit is no longer than three (3) months or, if such term is in excess of three (3) months, issued by a financial institution having a rating that the Rating Agencies have confirmed in writing will not, in and of itself, result in a downgrade, withdrawal or qualification of the initial, or, if higher, the highest then current ratings assigned in connection with any Securitization, which letter of credit shall be applied otherwise acceptable in form and substance to Lender and Borrower shall pay to Lender all of Lender’s reasonable out-of-pocket costs and expenses in connection therewith, including any fee charged by the Rating Agencies. Prior to the return of any such letter of credit, Borrower shall deposit with Lender an amount equal to the amount that would have accumulated in the Debt Service Reserve Account and not been disbursed in accordance with this Section 3.05 7.5.1 if the letter of credit had not been delivered. Any such letter of credit shall be additional security for Borrower’s obligations under the Security AgreementLoan Documents. If Lender shall have the right to draw in full upon any letter of credit: (i) if Lender has not received at least fifteen (15) Business Days prior to the date on which the last day then outstanding letter of any calendar quarter or credit is scheduled to expire, a notice from the issuing financial institution that it has renewed the applicable letter of credit; (ii) upon receipt of notice from the issuing financial institution that the applicable letter of credit will be terminated; (iii) ten (10) days after Lender has given notice to Borrower that the financial institution issuing the applicable letter of credit ceases to meet the rating requirement set forth in this Section 7.5.1; and (iv) upon the occurrence of any Business Interruption Period, the amount in the Debt Service Account is less than the Debt Service Reserve Amount at such time (including as a result of a Business Interruption Period), the HoldCo Borrower shall promptly cause amounts to be transferred into the Debt Service Account to the extent required so that the amount in the Debt Service Account is at least equal to the Debt Service Reserve Amount. In the event that the HoldCo Borrower fails to so deposit any such amounts, subject to Section 3.04(d) of the Security Agreement and to the terms of the NBA Consent Letter in each event, any or all amounts deposited into the Distribution Account shall be transferred into the Debt Service Account to the extent required so that the amount in the Debt Service Account is equal to at least the Debt Service Reserve Amount. At the HoldCo Borrower’s request, the Agent shall release to the HoldCo Borrower amounts from the Debt Service Account to the extent of any excess above the Debt Service Reserve Amount at such time, provided that no an Event of Default is continuing. Any amounts remaining in the Debt Service Account on the earlier of the Maturity Date and the date that all of the Commitments are terminated, other than any such amounts required to be utilized for the payment of principal or interest on Loans or other amounts then due and payable hereunder by the HoldCo Borrower, shall be released to the HoldCo Borrower, provided that no Event of Default is continuingDefault.

Debt Service Reserve. On or before the Closing Date, Borrower shall establish an interest-bearing account (a) The HoldCo Borrower agrees that all amounts deposited into the Debt Service Account from time to time shall be applied in accordance with Section 3.05 of the Security Agreement. If on the last day of any calendar quarter or upon the occurrence of any Business Interruption Period, the amount in the Debt Service Account is less than the "Debt Service Reserve Amount at such time (including as a result of a Business Interruption PeriodAccount"), the HoldCo to be maintained with and controlled by Administrative Agent, into which Borrower shall promptly cause amounts deposit, no later than five (5) Business Days prior to be transferred into the Debt Service Account to the extent required so that the each Interest Payment Date, an amount in the Debt Service Account is at least equal to the interest becoming due and payable on such Interest Payment Date. Administrative Agent is hereby irrevocably authorized and directed, on each Interest Payment Date, to withdraw from the Debt Service Reserve Amount. In Account an amount equal to the event that interest then due and payable under the HoldCo Borrower fails to so deposit any such amounts, subject to Section 3.04(d) of the Security Agreement Note and to distribute to each Lender such Lender's appropriate share thereof for the terms account of the NBA Consent Letter in each eventsuch Lender's Applicable Lending Office. If, however, five (5) Business Days prior to any or all amounts deposited into the Distribution Account shall be transferred into the Debt Service Account to the extent required so that Interest Payment Date, the amount on deposit in the Debt Service Reserve Account is not sufficient to pay the interest to become due and payable on such Interest Payment Date (the amount of any such insufficiency, the "Debt Service Deficiency"), Administrative Agent shall, on such fifth (5th) Business Day prior to the Interest Payment Date, so notify Borrower and each Lender, and each Lender shall fund, on such Interest Payment Date, proceeds of its Loan in an amount equal to at least its Pro Rata Share of the Debt Service Deficiency. Such notice to Borrower and Lenders will indicate whether the making of the funding would result in a breach of Borrower's covenants under Section 7.03 and, if such breach would result, will specify the additional amount required to be hedged to avoid default under Section 7.03. Proceeds of the Loans so funded by Lenders shall effect a dollar for dollar reduction in the Debt Service Allocation. Notwithstanding anything to the contrary contained in this Agreement or the other Loan Documents, to the extent a Delinquent Lender is obligated under this Agreement to fund proceeds of its Loan in respect of interest on the Note, and fails to do so, such portion of the interest on the Delinquent Lender's Loan (i.e., the interest on the Delinquent Lender's Loan that, absent the Delinquent Lender's failure to fund, would have been paid by fundings of the Debt Service Allocation) shall accrue (without interest on such interest not funded) and payment thereof shall be deferred until the Maturity Date (whether as stated or by acceleration or otherwise), it being understood that the maximum amount of interest that may be so deferred shall be the undisbursed portion of the Delinquent Lender's portion of the Debt Service Allocation. Accordingly, failure of Borrower to pay such interest that was required to be, but was not in fact, funded on a particular Interest Payment Date shall not constitute a Default. Interest earned by Borrower on the Debt Service Reserve Amount. At the HoldCo Borrower’s request, the Agent Account shall release be remitted to the HoldCo Borrower amounts from the Debt Service Account to the extent of any excess above the Debt Service Reserve Amount at such time, provided that no Event of Default is continuing. Any amounts remaining in the Debt Service Account on the earlier of the Maturity Date and the date that all of the Commitments are terminated, other than any such amounts required to be utilized for the payment of principal or interest on Loans or other amounts then due and payable hereunder by the HoldCo Borrower, shall be released to the HoldCo Borrower, provided that no Event of Default is continuingInterest Payment Date.

Debt Service Reserve. (aOn the Closing Date, Prior Owner deposited with Lender the amount of $2,000,000.00, which amount so deposited with Lender, together with any additional deposits with Lender pursuant to Section 2.5.2(b)(vi)(A) The HoldCo Borrower agrees that all amounts deposited into the Debt Service Account from time to time hereof, shall be applied held by Lender in accordance with Section 3.05 7.5 hereof. As of the Security Agreement. If on the last day of any calendar quarter or upon the occurrence of any Business Interruption PeriodAssumption Date, the amount held in the Debt Service Reserve Fund is $1,203,091.30. Amounts so deposited shall hereinafter be referred to as Borrower’s “Debt Service Reserve Fund” and the account in which such amounts are held shall hereinafter be referred to as Borrower’s “Debt Service Reserve Account”. Provided no Event of Default exists and is continuing, in the event on any Payment Date the funds available in the Cash Management Account is less than for application on such Payment Date pursuant to Section 2.5.2(b)(ii) are not sufficient to fund the Monthly Debt Service Amount on such Payment Date in full (the amount of insufficiency being herein referred to as the “Payment Date Deficiency” for such Payment Date), then to the extent of funds available in the Debt Service Reserve Amount at Account, Lender shall authorize the transfer on such time (including as a result of a Business Interruption Period), the HoldCo Borrower shall promptly cause amounts to be transferred into Payment Date from the Debt Service Reserve Account to the Cash Management Account, for application on such Payment Date pursuant to Section 2.5.2(b)(ii) to satisfy the Payment Date Deficiency. To the extent required so that the amount sufficient amounts are available in the Debt Service Reserve Account in accordance with this Section 7.4.3 and Lender is at least equal required hereunder to so authorize a transfer on such Payment Date of funds from the Debt Service Reserve Amount. In Account to the event that Cash Management Account to satisfy the HoldCo Borrower Payment Date Deficiency but Lender fails to so deposit any authorize the same, it shall not be a default or an Event of Default if such amountsPayment Date Deficiency is not paid due to such failure by Lender and, subject to Section 3.04(d) of the Security Agreement and to the terms of the NBA Consent Letter in each eventaccordingly, any no late charges or all amounts deposited into the Distribution Account default interest shall be transferred into payable by Borrower. When the Property shall have achieved the Debt Service Account to Coverage Ratio Threshold, then provided no Event of Default exists and is continuing, the extent required so that the amount in the Debt Service Account is equal to at least balance of the Debt Service Reserve AmountFund shall be disbursed to Borrower. At the HoldCo Borrower’s request, the Agent shall release to the HoldCo Borrower amounts from the The Debt Service Account to the extent of any excess above the Debt Service Reserve Amount at such time, provided that no Event of Default is continuing. Any amounts remaining in the Debt Service Account on the earlier Coverage Ratio shall be determined as of the Maturity Date end of each calendar quarter upon receipt by Lender from Borrower of such information and documentation concerning operating results at the date that all of Property as Lender may reasonably require to determine the Commitments are terminated, other than any such amounts required to be utilized for the payment of principal or interest on Loans or other amounts then due and payable hereunder by the HoldCo Borrower, shall be released to the HoldCo Borrower, provided that no Event of Default is continuingsame.

Debt Service Reserve. (a) The HoldCo On the date hereof, Borrower agrees that all amounts deposited shall deposit $400,000.00 into the Debt Service Account from Reserve Subaccount (as hereinafter defined) for the purpose of funding a reserve to provide an additional source for the payment of shortfalls in any payments required under Section 3.10(a)(i) – (vii) above at such time as when the operating income at the Property is insufficient to make such payment. Lender will transfer the deposit into a Subaccount (the “Debt Service Reserve Subaccount”) and shall disburse such amounts for such required payments as Lender deems necessary. Notwithstanding the above, at no time shall be applied any disbursement from the Debt Service Reserve Subaccount exceed the Monthly Debt Service Payment Amount for the Payment Date in accordance with Section 3.05 of which the Security Agreementshortfall has occurred. If Amounts on the last day of any calendar quarter or upon the occurrence of any Business Interruption Period, the amount deposit in the Debt Service Account is less than Reserve Subaccount shall be additional security and collateral for the Debt. Any amounts in the Debt Service Reserve Amount at such time Subaccount exceeding $200,000 shall be disbursed to Borrower upon the satisfaction by Borrower of the following conditions: (including as a) there is no Event of Default continuing, (b) an Approved Tenant has executed a result Lease, under terms wholly acceptable to Lender, (c) an Approved Tenant has begun paying Rent under its Lease on or prior to December 31, 2005, (d) Borrower submits to Lender a written request for disbursement, which shall be accompanied by an estoppel agreement executed by Approved Tenant, and in form reasonably acceptable to Lender, certifying that (1) Approved Tenant has accepted and is in possession of a Business Interruption Period)the leased premises (2) Approved Tenant has commenced paying Rent under the Lease on or prior to December 31, the HoldCo Borrower shall promptly cause amounts 2005 and (3) there are no Rent abatements, landlord concessions, or tenant improvement work to be transferred into completed and all current obligations of the Borrower as landlord under the Lease have been completed (subsections (a)-(d) hereof collectively being known as the “Tenant Occupancy Requirements”) and (e) all amounts in the Vacant Suites Lease Reserve Subaccount (as defined in Section 3.13 hereof) have been disbursed to Borrower or applied against the Debt (subsections (a)-(e) hereof collectively referred to as the “Debt Service Release Requirements”). If the Debt Service Account Release Requirements are not satisfied on or prior to December 31, 2005, the extent required so that Interest Rate shall be increased by seven (7) basis points (0.07%) and the amount Borrower shall be given an extension until March 1,2006 to complete the Debt Service Release Requirements. If, as of March 1, 2006, the Borrower has not satisfied the Debt Service Release Requirements, and there is no Event of Default continuing, any amounts in the Debt Service Account is Reserve Subaccount exceeding $200,000 shall be disbursed to Borrower. Further, at least equal such time as Tenant Long’s Drug Stores California, Inc. (“Long’s”) has commenced its lease term, and if all amounts in the Vacant Suites Lease Reserve Subaccount have been disbursed to Borrower or applied against the Debt, Borrower shall have the right to receive a one-time disbursement of all of the funds remaining on deposit in the Debt Service Reserve Amount. In Subaccount upon the event that the HoldCo satisfaction by Borrower fails to so deposit any such amounts, subject to Section 3.04(d) of the Security Agreement and to the terms of the NBA Consent Letter in each event, any or all amounts deposited into the Distribution Account shall be transferred into the Debt Service Account to the extent required so that the amount in the Debt Service Account following conditions: ((a) there is equal to at least the Debt Service Reserve Amount. At the HoldCo Borrower’s request, the Agent shall release to the HoldCo Borrower amounts from the Debt Service Account to the extent of any excess above the Debt Service Reserve Amount at such time, provided that no Event of Default is continuing. Any amounts remaining in the Debt Service Account on the earlier of the Maturity Date , and the date that all of the Commitments are terminated(b) Borrower submits to Lender a written request for disbursement, other than any such amounts required to which shall be utilized for the payment of principal or interest on Loans or other amounts then due and payable hereunder accompanied by the HoldCo an estoppel agreement executed by Borrower, shall be released in form reasonably acceptable to Lender, stating that Long’s has accepted its space, is currently paying rent, and Borrower has completed all requirements for tenant improvements under the HoldCo Borrower, provided that no Event of Default is continuingLong’s Lease.

Debt Service Reserve. (a) The HoldCo On the date hereof, Borrower agrees that all amounts deposited into shall deposit with Lender the amount of $3,000,000 for the purpose of creating a reserve for potential shortfalls in the amount of Rents being available to meet Borrower’s obligation to pay the Monthly Debt Service Account from time Payment Amounts due hereunder. Lender shall cause such amount to time shall be applied in accordance with Section 3.05 of transferred to a Subaccount (the Security Agreement. If on the last day of any calendar quarter or upon the occurrence of any Business Interruption Period, the amount in the Debt Service Account is less than the “Debt Service Reserve Amount at such time (including as a result of a Business Interruption PeriodSubaccount”), . To the HoldCo Borrower shall promptly cause amounts extent there are insufficient Rents to be transferred into pay the Monthly Debt Service Account to the extent required so that the amount in the Debt Service Account is at least equal to the Debt Service Reserve Amount. In the event that the HoldCo Borrower fails to so deposit any such amounts, subject Payment Amount pursuant to Section 3.04(d) of the Security Agreement and to the terms of the NBA Consent Letter in each event, any or all amounts deposited into the Distribution Account shall be transferred into the Debt Service Account to the extent required so that the amount in the Debt Service Account is equal to at least the Debt Service Reserve Amount. At the HoldCo Borrower’s request, the Agent shall release to the HoldCo Borrower amounts from the Debt Service Account to the extent of any excess above the Debt Service Reserve Amount at 3.11 hereof on such timePayment Date, provided that no Event of Default is continuing. Any amounts remaining , Lender shall disburse to itself funds held in the Debt Service Reserve Subaccount to pay such Monthly Debt Service Payment Amount (or the applicable portion thereof), and such disbursement shall be credited towards Borrower’s obligation to pay the Monthly Debt Service Payment Amount (or any portion thereof) due on such Payment Date pursuant to Section 2.2.1 hereof. Any funds remaining on deposit in the Debt Service Reserve Account on the earlier of the Maturity Date and the date that all of the Commitments are terminated, other than any such amounts required to be utilized for the payment of principal not previously disbursed or interest on Loans or other amounts then due and payable hereunder by the HoldCo Borrower, applied shall be released to Borrower upon the HoldCo Borrowerdate on which Lender has determined that the Property has achieved a Debt Service Coverage Ratio of at least 1.10:1 for two (2) consecutive Calculation Dates. In calculating the Debt Service Coverage Ratio solely for purposes of determining whether or not funds may be released from the Debt Service Reserve Subaccount as contemplated by the preceding sentence, provided the Net Operating Income component of such calculation shall be computed without taking into account the rent payable under any Leases which have an expiration date of December 31, 2009 or earlier, unless the space covered under any such Lease has been re-tenanted (for a term that no Event of Default is continuinghas commenced on or before January 1, 2010 and extends to at least January 1, 2010) pursuant to a fully executed and binding Lease that has been entered into in accordance with the Loan Documents.

Debt Service Reserve. (a) The HoldCo On the date hereof, Borrower agrees that all amounts deposited into shall deposit with Lender the amount of $4,500,000 for the purpose of creating a reserve for potential shortfalls in the amount of Rents being available to meet Borrower’s obligation to pay the Monthly Debt Service Account from time Payment Amounts due hereunder. Lender shall cause such amount to time shall be applied in accordance with Section 3.05 of transferred to a Subaccount (the Security Agreement. If on the last day of any calendar quarter or upon the occurrence of any Business Interruption Period, the amount in the Debt Service Account is less than the “Debt Service Reserve Amount at such time (including as a result of a Business Interruption PeriodSubaccount”), . To the HoldCo Borrower shall promptly cause amounts extent there are insufficient Rents to be transferred into pay the Monthly Debt Service Account to the extent required so that the amount in the Debt Service Account is at least equal to the Debt Service Reserve Amount. In the event that the HoldCo Borrower fails to so deposit any such amounts, subject Payment Amount pursuant to Section 3.04(d) of the Security Agreement and to the terms of the NBA Consent Letter in each event, any or all amounts deposited into the Distribution Account shall be transferred into the Debt Service Account to the extent required so that the amount in the Debt Service Account is equal to at least the Debt Service Reserve Amount. At the HoldCo Borrower’s request, the Agent shall release to the HoldCo Borrower amounts from the Debt Service Account to the extent of any excess above the Debt Service Reserve Amount at 3.11 hereof on such timePayment Date, provided that no Event of Default is continuing. Any amounts remaining , Lender shall disburse to itself funds held in the Debt Service Reserve Subaccount to pay such Monthly Debt Service Payment Amount (or the applicable portion thereof), and such disbursement shall be credited towards Borrower’s obligation to pay the Monthly Debt Service Payment Amount (or any portion thereof) due on such Payment Date pursuant to Section 2.2.1 hereof. Any funds remaining on deposit in the Debt Service Reserve Account on the earlier of the Maturity Date and the date that all of the Commitments are terminated, other than any such amounts required to be utilized for the payment of principal not previously disbursed or interest on Loans or other amounts then due and payable hereunder by the HoldCo Borrower, applied shall be released to Borrower upon the HoldCo Borrowerdate on which Lender has determined that the Property has achieved a Debt Service Coverage Ratio of at least 1.10:1 for two (2) consecutive Calculation Dates. In calculating the Debt Service Coverage Ratio solely for purposes of determining whether or not funds may be released from the Debt Service Reserve Subaccount as contemplated by the preceding sentence, provided the Net Operating Income component of such calculation shall be computed without taking into account the rent payable under any Leases which have an expiration date of December 31, 2009 or earlier, unless the space covered under any such Lease has been re-tenanted (for a term that no Event of Default is continuinghas commenced on or before January 1, 2010 and extends to at least January 1, 2010) pursuant to a fully executed and binding Lease that has been entered into in accordance with the Loan Documents.