This excerpt taken from the GIS 10-Q filed Jan 6, 2005.
13.11 Mark-to-Market Methodology.
(a) For purposes of determining the amount of any adjustment to the Gross Asset Values of the Companys Property pursuant to paragraphs (ii) or (iii) of the definition of Gross Asset Value in Section 1.10, the values of each of the Companys Permitted Assets must be determined (such value being the Mark-to-Market Value, and any calculation of such Mark-to-Market Value, the Mark-to-Market Valuation). The Gross Asset Value and Mark-to-Market Value of the Companys Permitted Assets shall be determined in accordance with the Valuation Methodology described on Schedule D hereto.
(b) In the event that it is necessary to determine the Mark-to-Market Value of the Companys Permitted Assets pursuant to this Section 13.11, such Mark-to-Market Valuation shall be performed by any nationally recognized independent accounting firm or other appraiser of national standing selected by the Managing Member and, if RBDB retains any of its Class A Limited Membership Interests, approved by RBDB; provided that any appraiser appointed hereunder shall be disinterested and qualified to appraise property similar to the Permitted Assets being appraised; and provided, further, that, solely for purposes of determining compliance with the Portfolio Requirements, the Mark-to-Market Valuation of all Permitted Loans that are obligations of any GMI Entity may be performed by the Managing Member. In the event the parties cannot agree on one appraiser, then the Managing Member shall select an appraiser (Appraiser 1) and the Required Class A Limited Members shall jointly select an appraiser (Appraiser 2) and the two appraisers shall jointly select a third appraiser (Appraiser 3). The value arrived at by appraisal shall be determined by Appraiser 1 and Appraiser 2 submitting their separate appraisals to Appraiser 3. Appraiser 3 shall independently review the appraisals and
shall select one appraisal between the two appraisals submitted as the appraisal that, in the opinion of Appraisal 3, best represents the value of the Permitted Assets. Where the appraisal process provided by this Section 13.11 is invoked, the parties and the appraisers shall all act promptly and diligently so as to determine the value of the Permitted Assets in a commercially reasonable period. The cost of all appraisals shall be borne by the Company.
(c) The Gross Asset Value and Mark-to-Market Value of all Permitted Loans that are obligations of any GMI Entity shall be equal to their stated principal amount; provided that, solely for the purposes of determining compliance with the Portfolio Requirements, if there has occurred and is continuing any GMI Event, the Gross Asset Value and Mark-to-Market Value of such Permitted Loans shall be equal to zero.
(d) The Gross Asset Value and Mark-to-Market Value of any Cash Equivalents shall be determined by reference to their face value, less unamortized discount, if any, and plus unamortized premium, if any.
(e) Except as provided above, the Gross Asset Value and Mark-to-Market Value of any A-Rated Securities shall be determined by reference to their average of the bid-side, market prices quoted by three investment or commercial banks of recognized standing.