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ESCROW AGREEMENT <br />Guaranty File No.: 67067-1 <br />Insured: Minnesota Housing Finance Agency ("MHFA") <br />Interested Party: City of Elk River ("City") <br />Borrower: Hillside Heights Limited Partnership <br />The undersigned, as Borrower, hereby agrees to employ Guaranty Commercial Title, Inc. <br />("Guaranty") to act as escrow agent in accordance with the following instructions and <br />provisions: <br />1. Borrower hereby deposits the sum of $138,929.28 with Guaranty. <br />2. The funds deposited ("Escrowed Funds") shall be held by Guaranty pending approval of <br />MHFA, City and Borrower that the Landscaping and Walking Path work as shown in <br />Exhibit A (the "Work") has been completed to their reasonable satisfaction, including <br />MHFA's receipt and approval of the as -built survey and final certificate of occupancy. <br />3. Upon receipt of confirmation of the terms set forth in paragraph 2 above, Guaranty shall <br />pay for all labor and materials and obtain final lien waivers for same. Any remaining <br />Escrow Funds will be distributed in accordance with Section 2.7 of MHFA's <br />Construction Loan Agreement executed in connection with the Hillside Heights project. <br />4. Subject to paragraphs 2 and 3, above, the City may, by providing 10 day advance written <br />notice to Borrower and Guaranty, assume responsibility for completion of the Work in <br />the event Borrower or contractor have abandoned or discontinued the Work for a period <br />of 30 consecutive days for reasons other than acts of God, fire, storm, strikes, blackouts, <br />labor difficulties, riots, inability to obtain materials, equipment or labor, governmental <br />restrictions, or any similar cause over which Borrower is unable to exercise control. The <br />City would submit a request for disbursement to Guaranty to pay the City's contractor <br />directly once MHFA has given its approval as contemplated by paragraph 2 above. <br />5. No rescission of this escrow or modification of its terms shall be effective without the <br />written consent of the undersigned and Guaranty. <br />6. City and Borrower shall hold Guaranty harmless from any claims or expenses arising out <br />of this Escrow Agreement, except for Guaranty's failure to account for payments made <br />pursuant to these instructions. <br />7. Following release of the Escrowed Funds as directed herein, Guaranty shall have no <br />further obligations or liabilities arising from or related to this Agreement. <br />[SIGNATURE PAGES TO FOLLOW] <br />Page 56 of 201 <br />