Laserfiche WebLink
10 <br />9. Secretary's Right to Use Pledged Funds for Repayment. The <br />Secretary may use funds pledged under paragraph 5(a) of this <br />Contract or funds restricted under grants pursuant to paragraph <br />8 of this Contract to make any payment required of the Borrower <br />under paragraph 2 and/or paragraph 4, if such payment has not <br />been timely made by the Borrower. <br />10. Defeasance. For purposes of this Contract, after the Conversion <br />Date the Note shall be deemed to have been paid (defeased) if <br />there shall have been deposited with the Trustee either moneys <br />or Government Obligations (as defined below), which in the sole <br />determination of the Secretary, mature and bear interest at <br />times and in amounts sufficient, together with any other moneys <br />on deposit with the Trustee for such purpose, to pay when due <br />the principal and interest to become due on the Note. The <br />Aggregate Principal Amount of the Note or any unpaid Principal <br />Amount may be so defeased, in whole or in part, as of any <br />Interest Due Date, or any other Business Day acceptable to both <br />HUD and the Borrower. In accordance with the Note and the Trust <br />Agreement, the Borrower shall give timely notice and written <br />instructions to the Secretary and the Trustee concerning any <br />principal amounts proposed to be defeased, including any <br />Optional Redemptions proposed, which instructions shall be <br />approved by the Secretary. If the unpaid Aggregate Principal <br />Amount of the Note guaranteed pursuant to this Contract shall be <br />defeased and deemed to have been paid in full, then the Borrower <br />shall be released from all agreements, covenants, and further <br />obligations under the Note. <br />"Government Obligation" means a direct obligation of, or any <br />obligation for which the full and timely payment of principal <br />and interest is guaranteed by, the United States of America, <br />including but not limited to, United States Treasury <br />Certificates of Indebtedness, Notes and Bonds - State and Local <br />Government Series or certificates of ownership of the principal <br />of or interest on direct obligations of, or obligations <br />unconditionally guaranteed by, the United States of America, <br />which obligations are held in trust by a commercial bank which <br />is a member of the Federal Reserve System and has capital and <br />surplus (exclusive of undivided profits) in excess of <br />$100,000,000. <br />11. Default. (a) A Default under the Note and this Contract <br />shall occur upon failure. by the Borrower to: <br />(i) pay when due an installment of principal or interest <br />on the Note; or (ii) punctually and properly perform, <br />observe, and comply with any covenant, agreement, or <br />condition contained in: (A) this Contract, (B) any <br />security agreement, deed of trust, mortgage, assignment, <br />guarantee, or other contract securing payment of <br />indebtedness evidenced by the Note, or (C) any future <br />