OR THE CONTENTS OF THE PREMISES ARISING FROM ANY RISK
COVERED BY CASUALTY INSURANCE CARRIED OR REQUIRED TO BE CARRIED IN THIS
ARTICLE 10, WHEN AND TO THE EXTENT, THAT SUCH LOSS OR DAMAGE IS ACTUALLY
COMPENSATED PURSUANT TO SUCH INSURANCE. LANDLORD AND TENANT ALSO AGREE THAT ANY
INSURANCE POLICIES OBTAINED BY EACH OF THEM PURSUANT TO THIS LEASE SHALL CONTAIN
ENDORSEMENTS WAIVING ANY RIGHT OF SUBROGATION WHICH THE INSURER MAY OTHERWISE
HAVE AGAINST THE NONINSURING PARTY. THE FOREGOING RELEASE AND THE FOREGOING
REQUIREMENT FOR WAIVERS OF SUBROGATION SHALL BE OPERATIVE ONLY SO LONG AS THE
SAME SHALL NEITHER PRECLUDE THE OBTAINING OF SUCH INSURANCE NOR DIMINISH, REDUCE
OR IMPAIR THE LIABILITY OF ANY INSURER.
20
ARTICLE XI - DAMAGE AND DESTRUCTION
11.1
TENANT'S RESTORATION. SUBJECT TO THE PROVISIONS
OF SECTION 11.2 BELOW, IF A LOSS BY FIRE OR OTHER CASUALTY OCCURS WHICH CAUSES
DESTRUCTION OR DAMAGE TO THE IMPROVEMENTS, THEN THE PARTIES AGREE AS FOLLOWS:
11.1.1
TENANT SHALL DILIGENTLY PURSUE THE RECONSTRUCTION,
RESTORATION AND REPAIR OF THE PREMISES (THE "RESTORATION WORK") IN COMPLIANCE
WITH ALL APPLICABLE LAWS AND SHALL CAUSE THE IMPROVEMENTS TO BE COMPLETELY
RESTORED TO THEIR CONDITION IMMEDIATELY PRIOR TO SUCH CASUALTY AS EXPEDITIOUSLY
AS POSSIBLE.
11.1.2
If no Default has occurred and is continuing, Tenant
shall have the right to adjust, and shall pay the entire cost of adjusting, such
loss with the Property Insurance provider, subject to the approval of Landlord
as to amount (such approval not to be unreasonably withheld or delayed), and
provided that the same are deposited with Landlord or title company or
disbursing agent reasonably acceptable to Landlord.
11.1.3
ALL INSURANCE PROCEEDS, TOGETHER WITH SUCH ADDITIONAL
AMOUNTS AS TENANT MAY BE REQUIRED TO CONTRIBUTE TO PAY FOR ALL RESTORATION WORK
SHALL BE DEPOSITED WITH LANDLORD OR AN ESCROW AGENT REASONABLY SATISFACTORY TO
LANDLORD (THE "ESCROW AGENT"), PURSUANT TO AN CONSTRUCTION ESCROW DISBURSING
AGREEMENT REASONABLY SATISFACTORY TO LANDLORD. TENANT SHALL PAY THE FEES AND
EXPENSES OF THE ESCROW AGENT .
11.1.4
TO THE EXTENT ANY INSURANCE PROCEEDS ARE PAID TO TENANT,
THE SAME SHALL BE HELD BY TENANT IN TRUST SOLELY FOR THE PURPOSE OF PAYING THE
COST OF THE RESTORATION WORK UNTIL SUCH TIME AS THE SAME ARE DEPOSITED INTO
ESCROW AS REQUIRED HEREIN.
11.1.5
TENANT SHALL CAUSE THE IMPROVEMENTS TO BE FULLY RESTORED
TO THAT CONDITION EXISTING IMMEDIATELY PRIOR TO SUCH CASUALTY (OR SUCH OTHER
CONDITION AS LANDLORD MAY APPROVE IN LANDLORD'S SOLE AND ABSOLUTE DISCRETION)
NOT LATER THAN ONE YEAR FOLLOWING THE DATE OF DAMAGE.
11.1.6
TENANT SHALL PAY ALL COSTS OF THE RESTORATION WORK,
REGARDLESS OF WHETHER THE AVAILABLE INSURANCE PROCEEDS ARE SUFFICIENT TO PAY
SUCH COSTS.
11.1.7
The Base Rent shall not abate, it being agreed that
Tenant shall be entitled to insure such obligation.
11.2
CASUALTY DURING LAST TWO YEARS OF LEASE TERM.
NOTWITHSTANDING THE FOREGOING, IF (A) A FIRE OR OTHER CASUALTY OCCURS, WHICH
CAUSES DESTRUCTION OR DAMAGE TO THE IMPROVEMENTS, WITHIN THE LAST TWO (2) YEARS
OF THE LEASE TERM, (B) THE DAMAGE