VALUABLE PAPERS PERTAINING THERETO.
AT ANY TIME, WHETHER BEFORE OR AFTER THE
OCCURRENCE OF ANY EVENT OF DEFAULT, THE SECURED PARTY MAY (BUT NEED NOT), IN THE
SECURED PARTY'S NAME OR IN A GRANTOR'S NAME, EXECUTE AND DELIVER PROOFS OF
CLAIM, RECEIVE ALL SUCH MONIES, INDORSE CHECKS AND OTHER INSTRUMENTS
REPRESENTING PAYMENT OF SUCH MONIES, AND ADJUST, LITIGATE, COMPROMISE OR RELEASE
ANY CLAIM AGAINST THE ISSUER OF ANY SUCH POLICY.
NOTWITHSTANDING ANY OF THE
FOREGOING, SO LONG AS NO EVENT OF DEFAULT EXISTS THE GRANTORS SHALL BE ENTITLED
TO ALL INSURANCE PROCEEDS WITH RESPECT TO EQUIPMENT OR INVENTORY PROVIDED THAT
SUCH PROCEEDS ARE APPLIED TO THE COST OF REPLACEMENT EQUIPMENT OR INVENTORY.
SECTION 17.
THE SECURED PARTY'S DUTIES.
THE POWERS CONFERRED ON THE
SECURED PARTY HEREUNDER, FOR THE RATABLE BENEFIT OF THE SECURED PARTY AND THE
LENDERS, ARE SOLELY TO PROTECT THEIR INTERESTS IN THE COLLATERAL AND SHALL NOT
IMPOSE ANY DUTY UPON THEM TO EXERCISE ANY SUCH POWERS.
THE SECURED PARTY SHALL
BE DEEMED TO HAVE EXERCISED REASONABLE CARE IN THE SAFEKEEPING OF ANY COLLATERAL
IN ITS POSSESSION IF SUCH COLLATERAL IS ACCORDED TREATMENT SUBSTANTIALLY EQUAL
TO THE SAFEKEEPING WHICH THE SECURED PARTY ACCORDS ITS OWN PROPERTY OF LIKE
KIND.
EXCEPT FOR THE SAFEKEEPING OF ANY COLLATERAL IN ITS POSSESSION AND THE
ACCOUNTING FOR MONIES AND FOR OTHER PROPERTIES ACTUALLY RECEIVED BY IT
HEREUNDER, THE SECURED PARTY SHALL HAVE NO DUTY, AS TO ANY COLLATERAL, AS TO
ASCERTAINING OR TAKING ACTION WITH RESPECT TO CALLS, CONVERSIONS, EXCHANGES,
MATURITIES, TENDERS OR OTHER MATTERS RELATIVE TO ANY COLLATERAL, WHETHER OR NOT
THE SECURED PARTY HAS OR IS DEEMED TO HAVE KNOWLEDGE OF SUCH MATTERS, OR AS TO
THE TAKING OF ANY NECESSARY STEPS TO PRESERVE RIGHTS AGAINST ANY PERSONS OR ANY
OTHER RIGHTS PERTAINING TO ANY COLLATERAL.
THE SECURED PARTY WILL TAKE ACTION
IN THE NATURE OF EXCHANGES, CONVERSIONS, REDEMPTIONS, TENDERS AND THE LIKE
REQUESTED IN WRITING BY THE GRANTORS WITH RESPECT TO THE COLLATERAL IN THE
SECURED PARTY'S POSSESSION IF THE SECURED PARTY IN ITS REASONABLE JUDGMENT
DETERMINES THAT SUCH ACTION WILL NOT IMPAIR THE SECURITY INTEREST OR THE VALUE
OF THE COLLATERAL, BUT A FAILURE OF THE SECURED PARTY TO COMPLY WITH ANY SUCH
REQUEST SHALL NOT OF ITSELF BE DEEMED A FAILURE TO EXERCISE REASONABLE CARE WITH
RESPECT TO THE TAKING OF ANY NECESSARY STEPS TO PRESERVE RIGHTS AGAINST ANY
PERSONS OR ANY OTHER RIGHTS PERTAINING TO ANY COLLATERAL.
SECTION 18.
DEFAULT.
EACH OF THE FOLLOWING OCCURRENCES SHALL
CONSTITUTE AN EVENT OF DEFAULT UNDER THIS AGREEMENT:
(A) ANY GRANTOR SHALL FAIL
TO OBSERVE OR PERFORM ANY COVENANT OR AGREEMENT APPLICABLE TO THE GRANTORS UNDER
THIS AGREEMENT; OR (B) ANY REPRESENTATION OR WARRANTY MADE BY ANY GRANTOR IN
THIS AGREEMENT OR ANY SCHEDULE, EXHIBIT, SUPPLEMENT OR ATTACHMENT HERETO OR IN
ANY FINANCIAL STATEMENTS, OR REPORTS OR CERTIFICATES HERETOFORE OR AT ANY TIME
HEREAFTER SUBMITTED BY OR ON BEHALF OF THE GRANTORS TO THE SECURED PARTY OR ANY
LENDER SHALL PROVE TO HAVE BEEN FALSE OR MATERIALLY MISLEADING WHEN MADE;