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The purchaser's obligation under the rental purchase
agreement to purchase the subject properties was subject
to the following condition:
Rental of the Properties to individual tenants
shall have been arranged, or shall be arranged,
upon execution by Purchaser of this Agreement
in accordance with the procedures set forth in
Exhibit "C," attached hereto and by this
reference made a part hereof.
According to exhibit C, in the event that EPIC had not
leased all of the properties as of the closing date, then
Babcock agreed to pay to the purchaser an amount equal to
three times the monthly fair market rent of each property
not leased as of the closing date as a nonrefundable
contribution toward the expense of listing, showing, and
leasing such property after the closing date. We refer
to this amount as the rent advance.
Under the rental purchase agreement, Babcock agreed
to pay to EPIC 6.8 percent of the purchase price of each
property on the closing date. We refer to this amount as
the builder fee. The agreement further requires as a
condition to the purchaser's obligation under the agreement
that Babcock pay to the purchaser 19.455 percent of the
purchase price of each property "as a contribution towards
rental deficits (referred to as the Rental Deficit
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