OTHER
OBLIGATIONS UNDER THE LOAN DOCUMENTS.
THE NET PROCEEDS SHALL BE DISBURSED BY
LENDER TO, OR AS DIRECTED BY, BORROWER OR MORTGAGE BORROWER FROM TIME TO TIME
DURING THE COURSE OF THE RESTORATION, UPON RECEIPT OF EVIDENCE SATISFACTORY TO
LENDER THAT (A) ALL THE CONDITIONS PRECEDENT TO SUCH ADVANCE, INCLUDING THOSE
SET FORTH IN SECTION 8.4(B)(I), HAVE BEEN SATISFIED, (B) ALL MATERIALS INSTALLED
AND WORK AND LABOR PERFORMED (EXCEPT TO THE EXTENT THAT THEY ARE TO BE PAID FOR
OUT OF THE REQUESTED DISBURSEMENT) IN CONNECTION WITH THE RELATED RESTORATION
ITEM HAVE BEEN PAID FOR IN FULL, AND (C) THERE EXIST NO NOTICES OF PENDENCY,
STOP ORDERS, MECHANIC'S
77
OR MATERIALMAN'S LIENS OR NOTICES OF INTENTION TO FILE SAME, OR ANY OTHER LIENS
OR ENCUMBRANCES OF ANY NATURE WHATSOEVER ON THE AFFECTED PROPERTY WHICH HAVE NOT
EITHER BEEN FULLY BONDED TO THE SATISFACTION OF LENDER AND DISCHARGED OF RECORD
OR IN THE ALTERNATIVE FULLY INSURED TO THE SATISFACTION OF LENDER BY THE TITLE
COMPANY ISSUING THE TITLE INSURANCE POLICY.
NOTWITHSTANDING THE FOREGOING,
INSURANCE PROCEEDS FROM THE POLICIES REQUIRED TO BE MAINTAINED BY BORROWER OR
MORTGAGE BORROWER PURSUANT TO SECTION 8.1(A)(III) SHALL BE CONTROLLED BY LENDER
AT ALL TIMES, SHALL NOT BE SUBJECT TO THE PROVISIONS OF THIS SECTION 8.4 AND
SHALL BE USED SOLELY FOR THE PAYMENT OF THE OBLIGATIONS UNDER THE LOAN DOCUMENTS
AND OPERATING EXPENSES.
(III)
ALL PLANS AND SPECIFICATIONS REQUIRED IN CONNECTION WITH THE
RESTORATION SHALL BE SUBJECT TO PRIOR REVIEW AND ACCEPTANCE IN ALL RESPECTS BY
LENDER AND BY AN INDEPENDENT CONSULTING ENGINEER SELECTED BY LENDER (THE
"RESTORATION CONSULTANT").
LENDER SHALL HAVE THE USE OF THE PLANS AND
SPECIFICATIONS AND ALL PERMITS, LICENSES AND APPROVALS REQUIRED OR OBTAINED IN
CONNECTION WITH THE RESTORATION.
THE IDENTITY OF THE CONTRACTORS,
SUBCONTRACTORS AND MATERIALMEN ENGAGED IN THE RESTORATION, AS WELL AS THE
CONTRACTS IN EXCESS OF $100,000 UNDER WHICH THEY HAVE BEEN ENGAGED, SHALL BE
SUBJECT TO PRIOR REVIEW AND ACCEPTANCE BY LENDER AND THE RESTORATION
CONSULTANT.
ALL COSTS AND EXPENSES INCURRED BY LENDER IN CONNECTION WITH MAKING
THE NET PROCEEDS AVAILABLE FOR THE RESTORATION, INCLUDING, WITHOUT LIMITATION,
REASONABLE COUNSEL FEES AND DISBURSEMENTS AND THE RESTORATION CONSULTANT'S FEES,
SHALL BE PAID BY BORROWER OR MORTGAGE BORROWER.
(IV)
IN NO EVENT SHALL LENDER BE OBLIGATED TO MAKE DISBURSEMENTS OF THE
NET PROCEEDS IN EXCESS OF AN AMOUNT EQUAL TO THE COSTS ACTUALLY INCURRED FROM
TIME TO TIME FOR WORK IN PLACE AS PART OF THE RESTORATION, AS CERTIFIED BY THE
RESTORATION CONSULTANT, MINUS THE RESTORATION RETAINAGE.
THE TERM "RESTORATION
RETAINAGE" SHALL MEAN AN AMOUNT EQUAL TO TEN PERCENT (10%) OF THE COSTS ACTUALLY
INCURRED FOR WORK IN PLACE AS PART OF THE RESTORATION, AS CERTIFIED BY THE
RESTORATION CONSULTANT, UNTIL THE RESTORATION HAS BEEN COMPLETED.
THE
RESTORATION RETAINAGE SHALL BE REDUCED TO FIVE PERCENT (5%) OF THE COSTS
INCURRED UPON RECEIPT BY LENDER OF SATISFACTORY EVIDENCE THAT FIFTY PERCENT
(50%) OF THE RESTORATION HAS BEEN COMPLETED.
THE RESTORATION RETAINAGE SHALL IN
NO EVENT, AND NOTWITHSTANDING ANYTHING TO THE CONTRARY