SUBSTANTIALLY IN THE
CONDITION IT WAS IN IMMEDIATELY PRIOR TO THE INSURED CASUALTY AND IN COMPLIANCE
WITH ALL ZONING, BUILDING AND OTHER APPLICABLE LEGAL REQUIREMENTS (THE
"PRE-EXISTING CONDITION") NOT LESS MATERIALLY VALUABLE (INCLUDING AN ASSESSMENT
OF THE IMPACT OF THE TERMINATION OF ANY LEASES DUE TO SUCH INSURED CASUALTY) AND
NOT LESS USEFUL THAN THE SAME WAS PRIOR TO THE INSURED CASUALTY, (3) LENDER
REASONABLY DETERMINES THAT THE RENTAL INCOME OF THE MORTGAGED PROPERTY, AFTER
THE RESTORATION THEREOF TO THE PRE-EXISTING CONDITION, WILL BE SUFFICIENT TO
MEET ALL OPERATING EXPENSES, PAYMENTS FOR RESERVES AND PAYMENTS OF PRINCIPAL AND
INTEREST UNDER THE LOAN AND SATISFY THE DEBT SERVICE COVERAGE TEST, AND (4)
TENANT LEASES REQUIRING PAYMENT OF ANNUAL RENT EQUAL TO AT LEAST SEVENTY-FIVE
PERCENT (75%) OF THE GROSS REVENUES FROM THE MORTGAGED PROPERTY DURING THE
TWELVE (12) MONTH PERIOD IMMEDIATELY PRECEDING THE DATE OF SUCH FIRE OR OTHER
CASUALTY REMAIN IN FULL FORCE AND EFFECT DURING AND AFTER THE RESTORATION OF THE
PROPERTY (SUBJECT TO THE RENT ABATEMENT PROVISIONS THEREOF APPLICABLE AS A
RESULT OF THE CASUALTY, SO LONG AS SUCH ABATEMENT WILL END, AND FULL RENTAL
PAYMENTS SHALL RESUME, UPON SUBSTANTIAL COMPLETION OF THE RESTORATION), OR IF
LENDER OTHERWISE ELECTS TO ALLOW A BORROWER TO RESTORE THE MORTGAGED PROPERTY,
THEN, IF NO EVENT OF DEFAULT SHALL HAVE OCCURRED AND BE CONTINUING, THE
INSURANCE PROCEEDS (AFTER REIMBURSEMENT OF ANY REASONABLE OUT-OF-POCKET EXPENSES
INCURRED BY LENDER IN CONNECTION WITH THE COLLECTION OF ANY APPLICABLE INSURANCE
PROCEEDS) SHALL BE MADE AVAILABLE TO REIMBURSE BORROWER FOR THE COST OF
RESTORING, REPAIRING, REPLACING OR REBUILDING THE MORTGAGED PROPERTY OR PART
THEREOF SUBJECT TO THE INSURED CASUALTY, AS PROVIDED FOR BELOW.
BORROWER HEREBY
COVENANTS AND AGREES TO COMMENCE AND DILIGENTLY TO PROSECUTE SUCH RESTORATION OF
THE AFFECTED MORTGAGED PROPERTY AS NEARLY AS POSSIBLE TO THE PRE-EXISTING
CONDITION.
BORROWER SHALL PAY ALL OUT-OF-POCKET COSTS (AND IF REQUIRED BY
LENDER, BORROWER SHALL DEPOSIT THE TOTAL THEREOF WITH LENDER IN ADVANCE) OF SUCH
RESTORATION IN EXCESS OF THE INSURANCE PROCEEDS MADE AVAILABLE PURSUANT TO THE
TERMS HEREOF.
89
(C)
EXCEPT AS PROVIDED ABOVE, THE INSURANCE PROCEEDS COLLECTED UPON
ANY INSURED CASUALTY SHALL, AT THE OPTION OF LENDER IN ITS SOLE DISCRETION, BE
APPLIED TO THE PAYMENT OF THE INDEBTEDNESS OR APPLIED TO THE COST OF RESTORATION
OF THE AFFECTED MORTGAGED PROPERTY OR PART THEREOF SUBJECT TO THE INSURED
CASUALTY, IN THE MANNER SET FORTH BELOW.
(D)
REGARDLESS OF WHETHER INSURANCE PROCEEDS, IF ANY, ARE SUFFICIENT OR
ARE MADE AVAILABLE TO BORROWER FOR THE RESTORATION OF ANY PORTION OF THE
AFFECTED MORTGAGED PROPERTY, BORROWER COVENANTS TO COMPLETE SUCH RESTORATION OF
THE AFFECTED MORTGAGED PROPERTY TO BE OF AT LEAST COMPARABLE VALUE AS PRIOR TO
SUCH DAMAGE OR DESTRUCTION, ALL TO BE EFFECTED IN ACCORDANCE WITH LEGAL
REQUIREMENTS AND PLANS AND SPECIFICATIONS APPROVED IN ADVANCE BY LENDER, SUCH
APPROVAL NOT TO BE UNREASONABLY WITHHELD OR DELAYED.
(E)
IN THE EVENT BORROWER IS ENTITLED TO REIMBURSEMENT OUT OF
INSURANCE PROCEEDS, SUCH PROCEEDS SHALL BE HELD BY LENDER IN THE LOSS