POLICIES OR CERTIFICATES OF INSURANCE REQUIRED BY THIS AGREEMENT, LENDER MAY, AT
ITS OPTION, PROCURE SUCH INSURANCE, AND BORROWER SHALL PAY, OR AS THE CASE MAY
BE, REIMBURSE LENDER FOR, ALL PREMIUMS THEREON PROMPTLY, UPON DEMAND BY LENDER,
WITH INTEREST THEREON AT THE DEFAULT RATE FROM THE DATE PAID BY LENDER TO THE
DATE OF REPAYMENT AND SUCH SUM SHALL CONSTITUTE A PART OF THE DEBT.
(C)
BORROWER SHALL DELIVER, OR SHALL CAUSE OWNER TO DELIVER, TO LENDER
SUCH OTHER
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INSURANCE AS MAY FROM TIME TO TIME BE REQUIRED BY LENDER AND WHICH IS THEN
CUSTOMARILY REQUIRED BY INSTITUTIONAL LENDERS FOR SIMILAR PROPERTIES SIMILARLY
SITUATED, AGAINST OTHER INSURABLE HAZARDS, INCLUDING, BUT NOT LIMITED TO,
MALICIOUS MISCHIEF, VANDALISM, ACTS OF TERRORISM, WINDSTORM AND/OR EARTHQUAKE,
DUE REGARD TO BE GIVEN TO THE SIZE AND TYPE OF THE PREMISES, IMPROVEMENTS,
FIXTURES AND EQUIPMENT AND THEIR LOCATION, CONSTRUCTION AND USE.
SECTION 2.31.
CASUALTY.
BORROWER SHALL GIVE LENDER PROMPT NOTICE OF ANY LOSS
OR DAMAGE TO THE PREMISES AND, SUBJECT TO THE RIGHTS OF THE MORTGAGE LENDER
UNDER THE MORTGAGE LOAN DOCUMENTS (WHICH SHALL IN ALL RESPECTS SUPERSEDE THE
RIGHTS OF LENDER UNDER THIS SECTION 2.31);
(A)
AFTER THE MORTGAGE LOAN HAS BEEN PAID IN FULL, IN THE EVENT OF ANY
LOSS OR DAMAGE COVERED BY ANY INSURANCE, LENDER IS HEREBY AUTHORIZED (I) IF AN
EVENT OF DEFAULT SHALL HAVE OCCURRED OR, IF NO EVENT OF DEFAULT SHALL HAVE
OCCURRED BUT BORROWER OR OWNER FAILS TO SETTLE AND ADJUST ANY CLAIM WITHIN
NINETY (90) BUSINESS DAYS AFTER SUCH CASUALTY HAS OCCURRED, TO SETTLE AND ADJUST
ANY CLAIM UNDER SUCH INSURANCE WITHOUT THE CONSENT OF BORROWER OR OWNER, OR (II)
IF NO EVENT OF DEFAULT HAS OCCURRED, TO ALLOW BORROWER OR OWNER WITHIN NINETY
(90) BUSINESS DAYS AFTER SUCH CASUALTY TO SETTLE AND ADJUST SUCH CLAIM WITH, IF
ANY SETTLEMENT MAY REASONABLY BE ANTICIPATED TO RESULT IN PROCEEDS IN EXCESS OF
$250,000.00, THE CONSENT OF LENDER, NOT TO BE UNREASONABLY WITHHELD; PROVIDED,
HOWEVER, THAT IN EITHER CASE LENDER SHALL, AND IS HEREBY AUTHORIZED TO, COLLECT
AND RECEIVE ANY SUCH INSURANCE PROCEEDS, SUBJECT, HOWEVER, TO THE RIGHTS OF
MORTGAGE LENDER UNDER THE MORTGAGE LOAN DOCUMENTS.
THE EXPENSES INCURRED BY
LENDER IN THE ADJUSTMENT AND COLLECTION OF SUCH PROCEEDS OF INSURANCE SHALL BE
ADDITIONAL DEBT OF BORROWER, AND SHALL BE REIMBURSED TO LENDER UPON DEMAND OR,
AT LENDER'S OPTION, IN THE EVENT AND TO THE EXTENT SUFFICIENT PROCEEDS ARE
AVAILABLE, DEDUCTED BY LENDER FROM SUCH PROCEEDS OF INSURANCE PRIOR TO ANY OTHER
APPLICATION THEREOF.
IF THE MORTGAGE LOAN HAS BEEN PAID IN FULL, EACH INSURANCE
COMPANY WHICH HAS ISSUED INSURANCE IS HEREBY AUTHORIZED AND DIRECTED TO MAKE
PAYMENT FOR ALL LOSSES COVERED BY SUCH INSURANCE TO LENDER ALONE, AND NOT TO
LENDER AND BORROWER OR OWNER JOINTLY.
BORROWER AGREES TO EXECUTE AND CAUSE
OWNER TO EXECUTE ALL DOCUMENTS AND MAKE ALL DELIVERIES REQUIRED IN ORDER TO
PERMIT ADJUSTMENT AND PAYMENT OF INSURANCE PROCEEDS AS PROVIDED ABOVE.
(B)
BORROWER HEREBY ASSIGNS TO LENDER THE PROCEEDS OF ALL