AGAINST SUCH CASUALTIES AND CONTINGENCIES AS SHALL BE IN
ACCORDANCE WITH GENERAL PRACTICES OF BUSINESSES ENGAGED IN SIMILAR ACTIVITIES IN
SIMILAR GEOGRAPHIC AREAS; PROVIDED, HOWEVER, THAT THE BORROWER SHALL AT ALL
TIMES MAINTAIN WITH FINANCIALLY SOUND AND REPUTABLE INSURERS SUCH INSURANCE IN
AMOUNTS NOT LESS THAN THE INSURANCE MAINTAINED BY THE BORROWER AS OF THE DATE
HEREOF, EXCEPT WITH THE PURCHASERS' PRIOR WRITTEN CONSENT (WHICH WILL NOT BE
UNREASONABLY WITHHELD OR DELAYED). SUCH INSURANCE SHALL BE IN SUCH MINIMUM
AMOUNTS THAT THE GRANTOR WILL NOT BE DEEMED A COINSURER UNDER APPLICABLE
INSURANCE LAWS, REGULATIONS AND POLICIES AND OTHERWISE SHALL BE IN SUCH AMOUNTS,
CONTAIN SUCH TERMS, BE IN SUCH FORMS AND BE FOR SUCH PERIODS AS MAY BE
REASONABLY SATISFACTORY TO THE PURCHASERS. IN ADDITION, ALL SUCH INSURANCE SHALL
BE PAYABLE TO THE PURCHASERS AS LOSS PAYEE. WITHOUT LIMITING THE FOREGOING, THE
GRANTORS WILL (I) KEEP ALL OF ITS PHYSICAL PROPERTY INSURED WITH CASUALTY OR
PHYSICAL HAZARD INSURANCE ON AN "ALL RISKS" BASIS, WITH BROAD FORM FLOOD AND
EARTHQUAKE COVERAGES AND ELECTRONIC DATA PROCESSING COVERAGE, (II) MAINTAIN ALL
SUCH WORKERS' COMPENSATION OR SIMILAR INSURANCE AS MAY BE REQUIRED BY LAW AND
(III) MAINTAIN, IN AMOUNTS AND WITH DEDUCTIBLES EQUAL TO THOSE GENERALLY
MAINTAINED BY BUSINESSES ENGAGED IN SIMILAR ACTIVITIES IN SIMILAR GEOGRAPHIC
AREAS, GENERAL PUBLIC LIABILITY INSURANCE AGAINST CLAIMS OF BODILY INJURY, DEATH
OR PROPERTY DAMAGE OCCURRING, ON, IN OR ABOUT THE PROPERTIES OF THE GRANTORS;
BUSINESS INTERRUPTION INSURANCE; AND PRODUCT LIABILITY INSURANCE.
11.2.
INSURANCE PROCEEDS. THE PROCEEDS OF ANY CASUALTY INSURANCE IN
RESPECT OF ANY CASUALTY LOSS OF ANY OF THE COLLATERAL SHALL, SUBJECT TO THE
RIGHTS, IF ANY, OF OTHER PARTIES WITH A PRIOR INTEREST IN THE PROPERTY COVERED
THEREBY, (I) SO LONG AS NO DEFAULT OR EVENT OF DEFAULT HAS OCCURRED AND IS
CONTINUING AND TO THE EXTENT THAT THE AMOUNT OF SUCH PROCEEDS IS LESS THAN
$150,000, BE DISBURSED TO THE GRANTOR FOR DIRECT APPLICATION BY THE GRANTOR
SOLELY TO THE REPAIR OR REPLACEMENT OF THE GRANTOR'S PROPERTY SO DAMAGED OR
DESTROYED AND (II) IN ALL OTHER CIRCUMSTANCES, BE HELD BY THE PURCHASERS AS CASH
COLLATERAL FOR THE OBLIGATIONS AND (EXCEPT TO THE EXTENT DISBURSED PURSUANT TO
THE NEXT SENTENCE) MAY BE APPLIED TO THE OBLIGATIONS. THE PURCHASERS MAY, AT
THEIR SOLE OPTION, DISBURSE FROM TIME TO TIME ALL OR ANY PART OF SUCH PROCEEDS
SO HELD AS CASH COLLATERAL (IN AN INTEREST-BEARING ACCOUNT, PROVIDED THAT THE
GRANTOR SHALL EXECUTE AND DELIVER TO THE PURCHASERS A PROPERLY COMPLETED FORM
W-9), UPON SUCH TERMS AND CONDITIONS AS THE PURCHASERS MAY REASONABLY PRESCRIBE,
FOR DIRECT APPLICATION BY THE GRANTOR SOLELY TO THE REPAIR OR REPLACEMENT OF THE
GRANTOR'S PROPERTY SO DAMAGED OR DESTROYED, OR THE PURCHASERS MAY APPLY ALL OR
ANY PART OF SUCH PROCEEDS TO THE OBLIGATIONS.
9
11.3.
NOTICE OF CANCELLATION ETC. ALL POLICIES OF INSURANCE SHALL PROVIDE
FOR AT LEAST 30 DAYS PRIOR WRITTEN CANCELLATION NOTICE TO THE PURCHASERS, UNLESS
A SHORTER PERIOD IS MANDATED UNDER APPLICABLE LAW. IN THE EVENT OF FAILURE BY