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On the Closing Date, Seller shall pay to
Purchaser a sum equal to the total estimated
rent for three (3) months, as shown on Exhibit
A for each of the Properties (the "Reserve").
At such time as all of the Properties have been
rented at least once, or upon the expiration of
seven (7) months from the Closing Date,
whichever shall first occur, Purchaser shall
refund the Reserve to Seller, less the product
of the rent, as shown in Exhibit A, times the
period of vacancy for each Property since the
Closing Date. For seven (7) full months after
the Closing Date, Purchaser shall furnish Seller
written monthly reports detailing occupancy and
rents.
In this opinion, we refer to the payment required under the
above provision as the rent advance.
The agreement further obligated U.S. Home to pay to
the purchaser "a sum equal to the amount as set forth on
Exhibit 'A' hereof of the purchase price of each Property
as a contribution towards rental deficits (rental deficit
contribution)." We refer to this amount as the rental
deficit contribution. Finally, the rental purchase
agreement conditioned the purchaser's obligation under the
agreement on the acquisition of "an appraisal of each of
the Properties by a FNMA/FHLMC qualified appraiser on a
standard FNMA/FHLMC form which shall reflect the value of
each Property equal to or greater than the purchase price
applicable to that Property".
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