TO BORROWER, TO TAKE SUCH
ACTION AS LENDER DEEMS NECESSARY TO PROTECT ITS INTEREST IN THE PROPERTY,
INCLUDING, WITHOUT LIMITATION, THE OBTAINING OF SUCH INSURANCE COVERAGE AS
LENDER IN ITS REASONABLE DISCRETION DEEMS APPROPRIATE.
ALL PREMIUMS INCURRED BY
LENDER IN CONNECTION WITH SUCH ACTION OR IN OBTAINING SUCH INSURANCE AND KEEPING
IT IN EFFECT SHALL BE PAID
65
BY BORROWER TO LENDER UPON DEMAND AND, UNTIL PAID, SHALL BE SECURED BY THE
MORTGAGE AND SHALL BEAR INTEREST AT THE DEFAULT RATE.
IF BORROWER FAILS IN SO
INSURING THE PROPERTY OR IN SO ASSIGNING AND DELIVERING THE POLICIES, LENDER
MAY, AT ITS OPTION, OBTAIN SUCH INSURANCE USING SUCH CARRIERS AND AGENCIES AS
LENDER SHALL ELECT FROM YEAR TO YEAR AND PAY THE PREMIUMS THEREFOR, AND BORROWER
WILL REIMBURSE LENDER FOR ANY PREMIUM SO PAID, WITH INTEREST THEREON AS STATED
IN THE NOTE FROM THE TIME OF PAYMENT, ON DEMAND, AND THE AMOUNT SO OWNING TO
LENDER SHALL BE SECURED BY THE MORTGAGE.
THE INSURANCE OBTAINED BY LENDER MAY,
BUT NEED NOT, PROTECT BORROWER'S INTEREST AND THE COVERAGE THAT LENDER PURCHASES
MAY NOT PAY ANY CLAIM THAT BORROWER MAKES OR ANY CLAIM THAT IS MADE AGAINST
BORROWER IN CONNECTION WITH THE PROPERTY.
SECTION 6.2
CASUALTY.
IF THE PROPERTY SHALL BE DAMAGED OR
DESTROYED, IN WHOLE OR IN PART, BY FIRE OR OTHER CASUALTY (A "CASUALTY"),
BORROWER (A) SHALL GIVE TO LENDER PROMPT NOTICE OF SUCH DAMAGE REASONABLY
ESTIMATED BY BORROWER TO COST MORE THAN FIVE HUNDRED THOUSAND DOLLARS
($500,000.00) TO REPAIR, AND (B) SHALL PROMPTLY COMMENCE AND DILIGENTLY
PROSECUTE THE COMPLETION OF THE REPAIR AND RESTORATION OF THE PROPERTY AS NEARLY
AS POSSIBLE TO THE CONDITION THE PROPERTY WAS IN IMMEDIATELY PRIOR TO SUCH FIRE
OR OTHER CASUALTY, WITH SUCH ALTERATIONS AS MAY BE REASONABLY APPROVED BY
LENDER, (A "RESTORATION") AND OTHERWISE IN ACCORDANCE WITH SECTION 6.4. BORROWER
SHALL PAY, OR CAUSE TO BE PAID, ALL COSTS OF SUCH RESTORATION WHETHER OR NOT
SUCH COSTS ARE COVERED BY INSURANCE. LENDER MAY, BUT SHALL NOT BE OBLIGATED TO
MAKE PROOF OF LOSS IF NOT MADE PROMPTLY BY BORROWER.
SECTION 6.3
CONDEMNATION.
BORROWER SHALL PROMPTLY GIVE LENDER
NOTICE OF THE ACTUAL OR THREATENED COMMENCEMENT OF ANY PROCEEDING FOR THE
CONDEMNATION OF THE PROPERTY UPON OBTAINING INFORMATION OF SUCH PROCEEDING AND
SHALL DELIVER TO LENDER COPIES OF ANY AND ALL PAPERS SERVED IN CONNECTION WITH
SUCH PROCEEDINGS.
LENDER MAY PARTICIPATE IN ANY SUCH PROCEEDINGS IF AN EVENT OF
DEFAULT EXISTS OR IF THE AMOUNT OF THE AWARD EXCEEDS THREE PERCENT (3%) OF THE
OUTSTANDING PRINCIPAL AMOUNT OF THE LOAN, AND BORROWER SHALL FROM TIME TO TIME
DELIVER TO LENDER ALL INSTRUMENTS REQUESTED BY IT TO PERMIT SUCH PARTICIPATION.
BORROWER SHALL, AT ITS EXPENSE, DILIGENTLY PROSECUTE ANY SUCH PROCEEDINGS, AND
SHALL CONSULT WITH LENDER, ITS ATTORNEYS AND EXPERTS, AND COOPERATE WITH THEM IN
THE CARRYING ON OR DEFENSE OF ANY SUCH PROCEEDINGS.
NOTWITHSTANDING ANY TAKING
BY ANY PUBLIC OR QUASI-PUBLIC AUTHORITY THROUGH CONDEMNATION OR OTHERWISE
(INCLUDING BUT NOT LIMITED TO ANY TRANSFER MADE IN LIEU