OR SHALL CAUSE MORTGAGE BORROWER TO, NOTIFY LENDER IN WRITING WITHIN THREE
BUSINESS DAYS AFTER BORROWER OR MORTGAGE BORROWER, AS APPLICABLE, FIRST RECEIVES
NOTICE OF ANY SUCH NON-COMPLIANCE.
BORROWER SHALL, OR SHALL CAUSE MORTGAGE
BORROWER TO, PROMPTLY REPAIR, REPLACE OR REBUILD ANY PART OF THE PROPERTY THAT
BECOMES DAMAGED, WORN OR DILAPIDATED AND SHALL COMPLETE AND PAY FOR ANY
IMPROVEMENTS AT ANY TIME IN THE PROCESS OF CONSTRUCTION OR REPAIR.
5.4.2
ALTERATIONS.
BORROWER MAY, OR MAY CAUSE MORTGAGE BORROWER TO,
WITHOUT LENDER'S CONSENT, PERFORM ALTERATIONS TO THE IMPROVEMENTS AND EQUIPMENT
WHICH (I) DO NOT CONSTITUTE A MATERIAL ALTERATION, (II) DO NOT ADVERSELY AFFECT
BORROWER'S OR MORTGAGE BORROWER'S FINANCIAL CONDITION OR THE VALUE OR NET
OPERATING INCOME OF THE PROPERTY AND (III) ARE IN THE ORDINARY COURSE OF
BORROWER'S OR MORTGAGE BORROWER'S BUSINESS, AS APPLICABLE.
NEITHER BORROWER NOR
MORTGAGE BORROWER SHALL PERFORM ANY MATERIAL ALTERATION WITHOUT LENDER'S PRIOR
WRITTEN CONSENT, WHICH CONSENT SHALL NOT BE UNREASONABLY WITHHELD OR DELAYED.
LENDER MAY, AS A CONDITION TO GIVING ITS CONSENT TO A MATERIAL ALTERATION,
REQUIRE THAT BORROWER DELIVER TO LENDER
44
SECURITY FOR PAYMENT OF THE COST OF SUCH MATERIAL ALTERATION IN AN AMOUNT EQUAL
TO ONE HUNDRED TWENTY-FIVE PERCENT (125%) OF THE COST OF THE MATERIAL ALTERATION
AS ESTIMATED BY LENDER AND BORROWER SHALL BE PERMITTED TO USE SUCH SECURITY TO
MAKE SUCH PAYMENT OF THE COST OF SUCH MATERIAL ALTERATION BY SATISFYING THE SAME
CONDITIONS FOR DISBURSEMENT FROM THE REPLACEMENT RESERVE SUBACCOUNT SET FORTH IN
SECTION 3.13 OF THE MORTGAGE LOAN AGREEMENT AS THOUGH A REQUEST FOR DISBURSEMENT
WERE MADE THEREUNDER.
UPON SUBSTANTIAL COMPLETION OF THE MATERIAL ALTERATION,
BORROWER SHALL, OR SHALL CAUSE MORTGAGE BORROWER TO, PROVIDE EVIDENCE
SATISFACTORY TO LENDER THAT (I) THE MATERIAL ALTERATION WAS CONSTRUCTED IN
ACCORDANCE WITH APPLICABLE LEGAL REQUIREMENTS AND SUBSTANTIALLY IN ACCORDANCE
WITH PLANS AND SPECIFICATIONS APPROVED BY LENDER (WHICH APPROVAL SHALL NOT BE
UNREASONABLY WITHHELD OR DELAYED), (II) ALL CONTRACTORS, SUBCONTRACTORS,
MATERIALMEN AND PROFESSIONALS WHO PROVIDED WORK, MATERIALS OR SERVICES IN
CONNECTION WITH THE MATERIAL ALTERATION HAVE BEEN PAID IN FULL AND HAVE
DELIVERED UNCONDITIONAL RELEASES OF LIEN AND (III) ALL MATERIAL LICENSES
NECESSARY FOR THE USE, OPERATION AND OCCUPANCY OF THE MATERIAL ALTERATION (OTHER
THAN THOSE WHICH DEPEND ON THE PERFORMANCE OF TENANT IMPROVEMENT WORK) HAVE BEEN
ISSUED.
BORROWER SHALL, OR SHALL CAUSE MORTGAGE BORROWER TO, REIMBURSE LENDER
UPON DEMAND FOR ALL OUT-OF-POCKET COSTS AND EXPENSES (INCLUDING THE REASONABLE
FEES OF ANY ARCHITECT, ENGINEER OR OTHER PROFESSIONAL ENGAGED BY
LENDER) INCURRED BY LENDER IN REVIEWING PLANS AND SPECIFICATIONS OR IN MAKING
ANY DETERMINATIONS NECESSARY TO IMPLEMENT THE PROVISIONS OF THIS SECTION 5.4.2.
NOTWITHSTANDING THE FOREGOING, BORROWER SHALL BE RELIEVED OF ITS OBLIGATION TO
DEPOSIT THE SECURITY FOR CERTAIN ALTERATIONS DESCRIBED ABOVE PROVIDED MORTGAGE
BORROWER IS REQUIRED TO AND DOES DELIVER SUCH SECURITY TO MORTGAGE LENDER IN
ACCORDANCE WITH THE MORTGAGE LOAN DOCUMENTS AND LENDER RECEIVES EVIDENCE
REASONABLY ACCEPTABLE TO LENDER OF THE DELIVERY OF SUCH SECURITY.
PROVIDED NO
DEFAULT OR EVENT OF DEFAULT SHALL HAVE OCCURRED AND IS CONTINUING, UPON DELIVERY
OF