05 - JOINT PH - Vista Del Rio DDA

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contractor, subcontractor or other claimant; or directly to any such claimant; or by any other means reasonably selected by City, or Agency, as applicable. 6.10 Cost Overruns. In the event that, at any time and for any reason, (a) the actual cost reasonably estimated by City, Agency, or Vista Del Rio to be required to complete all matters included in any line item by $10,000.00 in the Project Budget exceeds the amount allocated to that line item in the Project Budget, (b) Construction costs for any matters not covered by a specific line item have been or will be incurred in excess of $10,000.00, or (c) the undisbursed portion of the proceeds of the Loans is or maybe insufficient to pay all Construction costs that maybe payable under the Loan Documents or otherwise in connection with the Construction, Vista Del Rio shall, within ten (10) days after it receives written notice thereof from City or Agency of any of the foregoing matters, do one or more of the following: (a) provide satisfactory evidence to City and/or Agency that Vista Del Rio has previously paid such excess or otherwise provided for such insufficiency (collectively, the "Excess Cost") with funds from a source other than the Loans; (b) reallocate sufficient funds to pay the Excess Cost from funds allocated to "Contingency" in the Project Budget; provided, however, that the Executive Directors' reasonable consent to any such reallocation shall be required; or (c) deposit an amount equal to the Excess Cost in anon-interest bearing account (the "Ovenun Account") with the Construction Lender from which withdrawals maybe made only with the consent of the Executive Directors but which will be exhausted prior to any further disbursement for any line item, so that any resulting surplus in any line item of the Project Budget will then be reallocated to the line item(s) in which the Excess Costs are expected to be incurred. Neither Agency nor City shall have any obligation to make further disbursements until Vista Del Rio has paid or otherwise provided for the overrun as required above. Amounts deposited by Vista Del Rio in the Overrun Account for any Excess Costs shall be disbursed by the Construction Lender prior to the disbursement of any remaining proceeds of the Loans. 6.11 Cost Savings. Upon completion of and disbursement for all matters covered by any line items in the Project Budget, any remaining undisbursed amounts allocated to that line item shall be reallocated to "Contingency" and thereafter be available for disbursement in accordance with the terms of this Agreement. 6.12 Retainage. City and Agency will withhold a Retainage of 10% from each Disbursement for each of the Construction cost line items of the Project Budget until all conditions to the final disbursement of Construction costs have been satisfied. City shall not retain funds for building materials purchased by Vista Del Rio for which Vista Del Rio supplies documentation to City proving payment in full or for soft costs. 6.12.1 Holdback. The retainage otherwise available for disbursement shall be subject to a holdback of one hundred twenty-five percent (125%) of the estimated cost (as determined by the Executive Directors) for "punch-list" items. Such holdback will be released when all punch-list items have been completed to the satisfaction of City and Agency. D O C S O C/ 1475 221 v5 /200272 -0004 16