THE REQUIREMENTS OF ALL INSURANCE
CARRIERS WHICH PROVIDE INSURANCE WITH RESPECT TO THE ASSETS AND PROPERTIES OF
SUCH BORROWER SO THAT SUCH INSURANCE SHALL REMAIN IN FULL FORCE AND EFFECT. EACH
BORROWER SHALL BEAR THE FULL RISK OF ANY LOSS OF ANY NATURE WHATSOEVER WITH
RESPECT TO THE COLLATERAL. AT EACH BORROWER'S OWN COST AND EXPENSE IN AMOUNTS
AND WITH CARRIERS ACCEPTABLE TO AGENT, EACH BORROWER SHALL (A) KEEP ALL ITS
INSURABLE PROPERTIES AND PROPERTIES IN WHICH SUCH BORROWER HAS AN INTEREST
INSURED AGAINST THE HAZARDS OF FIRE, FLOOD, SPRINKLER LEAKAGE, THOSE HAZARDS
COVERED BY EXTENDED COVERAGE INSURANCE AND SUCH OTHER HAZARDS, AND FOR SUCH
AMOUNTS, AS IS CUSTOMARY IN THE CASE OF COMPANIES ENGAGED IN BUSINESSES SIMILAR
TO SUCH BORROWER'S; (B) MAINTAIN PUBLIC AND, IF APPLICABLE, PRODUCT LIABILITY
INSURANCE AGAINST CLAIMS FOR PERSONAL INJURY, DEATH OR PROPERTY DAMAGE SUFFERED
BY OTHERS; (C) MAINTAIN ALL SUCH WORKER'S COMPENSATION OR SIMILAR INSURANCE AS
MAY BE REQUIRED UNDER THE LAWS OF ANY STATE OR JURISDICTION IN WHICH SUCH
BORROWER IS ENGAGED IN BUSINESS; (D) FURNISH AGENT WITH (I) COPIES OF ALL
POLICIES AND EVIDENCE OF THE MAINTENANCE OF SUCH POLICIES BY THE RENEWAL THEREOF
AT LEAST THIRTY (30) DAYS BEFORE ANY EXPIRATION DATE, AND (II) APPROPRIATE LOSS
PAYABLE ENDORSEMENTS IN FORM AND SUBSTANCE SATISFACTORY TO AGENT, NAMING AGENT
AS A CO-INSURED AND LOSS PAYEE AS ITS INTERESTS MAY APPEAR WITH RESPECT TO ALL
INSURANCE COVERAGE REFERRED TO IN CLAUSES (A) AND (C)
ABOVE, AND PROVIDING
(A) THAT ALL PROCEEDS THEREUNDER SHALL BE PAYABLE TO AGENT, (B) NO SUCH
INSURANCE SHALL BE AFFECTED BY ANY ACT OR NEGLECT OF THE INSURED OR OWNER OF THE
PROPERTY DESCRIBED IN SUCH POLICY, AND (C) THAT SUCH POLICY AND LOSS PAYABLE
CLAUSES MAY NOT BE CANCELLED, AMENDED OR TERMINATED UNLESS AT LEAST THIRTY (30)
DAYS' PRIOR WRITTEN NOTICE IS GIVEN TO AGENT. IN THE EVENT OF ANY LOSS
THEREUNDER, THE CARRIERS NAMED THEREIN HEREBY ARE DIRECTED BY AGENT AND THE
APPLICABLE BORROWER TO MAKE PAYMENT FOR SUCH LOSS TO AGENT AND NOT TO SUCH
BORROWER AND AGENT JOINTLY. IF ANY INSURANCE LOSSES ARE PAID BY CHECK, DRAFT OR
OTHER INSTRUMENT PAYABLE TO ANY BORROWER AND AGENT
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jointly, Agent may endorse such Borrower's name thereon and do such other things
as Agent may deem advisable to reduce the same to cash. Agent is hereby
authorized to adjust and compromise claims under insurance coverage referred to
in clauses (a) and (b) above. All loss recoveries received by Agent upon any
such insurance may be applied to the Obligations, in such order as Agent in its
sole discretion shall determine. Any surplus shall be paid by Agent to Borrowers
or applied as may be otherwise required by law. Any deficiency thereon shall be
paid by Borrowers to Agent, on demand.
4.12.
Failure to Pay Insurance. If any Borrower fails to obtain insurance
as hereinabove provided, or to keep the same in force, Agent, if Agent so
elects, may obtain such insurance and pay the premium therefor on