6.0. EDSR 06-10-2002 - Laserfiche WebLink

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Minimum Participation-No Maximum Participation The Initial Closing is conditional upon a minimum of$2,500,000 of Member Funds being deposited into the Loan • Fund by Members, pursuant to Participation Agreements. Deposits to the Loan Fund shall be refunded without interest in the event the Initial Closing does not occur on or before October 31, 2002. MCCF will continue to offer this Participation following the Initial Closing and there is no limit upon the number of Members that may be thereafter admitted to MCCF or the aggregate amount of Members' deposits to the Loan Fund. (See"Closing"). Deposits to Loan Fund Refundable upon Certain Conditions A Member shall receive a refund of their deposit balance in the Loan Fund upon 30 days' advance written notice to MCCF and the Escrow Agent specifying the amount of refund that the Member wishes to receive. This notice may be given at any time after the third anniversary date of the first deposit to the Loan Fund made by the Member. See "Membership"and"Loan Fund Escrow Agreement Summary". Offeree Participation Offerees who desire to participate may do so by executing the Participation Agreement included in this Prospectus as Exhibit E and the Loan Fund Escrow Agreement included in this Prospectus as Exhibit D. Participation by an Offeree is subject to approval by the Board of Directors of MCCF. See "Summary of Participation Agreement", "Loan Fund Escrow Agreement Summary",and"How to Participate". RISK FACTORS Risks Related to Member Funds Member Funds are deposited pursuant to the Participation Agreement directly into the Loan Fund that has been established at Wells Fargo Bank Minnesota, N.A. The Loan Fund is an escrow account and Wells Fargo Bank Minnesota, N.A. is the Escrow Agent. Member Funds deposited in the Loan Fund remain assets of the Member. io MCCF agrees with Members in the Participation Agreement that it will request the Escrow Agent for disbursement of Member Funds only for the purpose of initially funding Development Loans and then only upon the following conditions as described in the Participation Agreement: (i) All Development Loans will be sold prior to closing to a Loan Purchaser. (ii) MCCF will direct the Escrow Agent to wire transfer funds sufficient to fund a Development Loan closing to a title company or other authorized loan closer designated by MCCF for purposes of initially funding a Development Loan which has been made by MCCF. (iii) MCCF shall follow a detailed procedure set forth in the Participation Agreement with respect to the closing of the Development Loans including confirmation by MCCF that a Loan Purchaser has wire transferred to the Loan Fund an amount equal to the funds the Loan Fund previously advanced to the title company or authorized loan closer for purposes of initially funding the Development Loan. The risk of loss of Member Funds only arises if the foregoing agreements and conditions by MCCF are not followed by MCCF. Loss of Use of Funds The Member Funds deposited by a Member are unavailable to the Member for a period of three years. Investment of Loan Fund MCCF is granted by Members the authority to direct investment of the Loan Fund. Such investments shall be limited to U.S. Government Bonds,U.S. Government Agency Bonds, U.S. Government Money Market Funds, and • federally-insured Certificates of Deposit. U.S. Government Agency Bonds and U.S. Government Money Market Funds are not direct obligations of the United States of America and are not backed by the full faith and credit of the United States of America. 3