TYPE OF CONSTRUCTION AS MAY FROM TIME TO TIME BE REASONABLY
REQUIRED BY LENDER.
F)
ALL INSURANCE PROVIDED FOR IN SECTION 6.1.1(D) AND (E)
HEREOF SHALL BE OBTAINED UNDER VALID AND ENFORCEABLE POLICIES (SUCH POLICIES,
COLLECTIVELY, THE "BORROWER POLICIES" OR IN THE SINGULAR THE "BORROWER POLICY"
AND TOGETHER WITH THE CONDOMINIUM POLICIES, COLLECTIVELY THE "POLICIES").
PRIOR
TO THE EXPIRATION DATES OF THE BORROWER POLICIES THERETOFORE FURNISHED TO
LENDER, CERTIFICATES OF INSURANCE, ACCEPTABLE TO LENDER, EVIDENCING RENEWAL OF
THE BORROWER POLICIES AND ACCOMPANIED BY EVIDENCE SATISFACTORY TO LENDER OF
PAYMENT OF THE INSURANCE PREMIUMS DUE THEREUNDER SHALL BE DELIVERED BY BORROWER
TO LENDER. CARRIER CERTIFIED COPIES OF THE BORROWER POLICIES SHALL BE PROVIDED
TO LENDER UPON REQUEST.
1.5.2
SECTION 6.1.7 LIMITATION ON TERRORISM COVERAGES.
THE TERRORISM
POLICY SHALL BE ON TERMS CONSISTENT WITH THOSE REQUIRED UNDER SECTION
6.1.1(B)(IV) AND SECTION 6/1/1(E)(IV) ABOVE AT ALL TIMES DURING THE TERM OF THE
LOAN, SUBJECT TO THE ANNUAL LIMIT ON INSURANCE PREMIUMS THEREFORE EQUAL TO THE
TERRORISM PREMIUM LIMIT.
1.5.3
SECTION 6.1.9 CAPTIVE INSURANCE COMPANY.
(A)
NOTWITHSTANDING ANYTHING TO THE CONTRARY SET FORTH IN SECTION 6.1.1,
THE TERRORISM POLICY REQUIRED PURSUANT TO SECTION 6.1.1(C)(IV) MAY BE ISSUED BY
A CAPTIVE INSURANCE COMPANY WHOLLY-OWNED AND CONTROLLED BY AN AFFILIATE OF
BORROWER (A "CAPTIVE INSURANCE COMPANY)"; PROVIDED THAT:
<
(I)
UNLESS LENDER AGREES OTHERWISE IN WRITING, TRIA SHALL BE IN FULL FORCE
AND EFFECT;
(II)
EXCEPT WITH RESPECT TO THE DEDUCTIBLE PERMITTED HEREUNDER, THOSE
COVERED LOSSES WHICH ARE NOT REINSURED BY THE FEDERAL GOVERNMENT UNDER TRIA AND
PAYABLE DIRECTLY TO THE INSURED SHALL BE REINSURED BY AN INSURANCE COMPANY WHICH
SATISFIES THE REQUIREMENTS OF SECTION 6.1.2;
(III)
ALL RE-INSURANCE AGREEMENTS BETWEEN SUCH CAPTIVE INSURANCE
COMPANY AND ALL SUCH RE-INSURANCE COMPANIES PROVIDING THE REFERENCED
RE-INSURANCE SHALL BE REASONABLY ACCEPTABLE TO LENDER AND BORROWER SHALL USE
COMMERCIALLY REASONABLE EFFORTS TO CAUSE SUCH RE-INSURANCE AGREEMENTS TO
PROVIDE
16
FOR DIRECT ACCESS TO SUCH RE-INSURERS BY ALL NAMED INSUREDS, LOSS PAYEES AND
MORTGAGEES WHICH SUCH INSURANCE BENEFITS;
(IV)
SUCH CAPTIVE INSURANCE COMPANY SHALL NOT BE THE SUBJECT OF
BANKRUPTCY OR SIMILAR INSOLVENCY PROCEEDING;
(V)
SUCH CAPTIVE INSURANCE COMPANY SHALL BE PROHIBITED FROM
CONDUCTING ANY BUSINESS OTHER THAN THE ISSUANCE OF TERRORISM INSURANCE POLICIES
AND ANY OTHER CONTEMPLATED INSURANCE COVERAGE REASONABLY APPROVED BY LENDER FOR
PROPERTIES IN WHICH AFFILIATES OF GUARANTOR HAVE AN OWNERSHIP INTEREST EQUAL TO
OR GREATER THAN 50%.
(VI)
SUCH CAPTIVE INSURANCE COMPANY SHALL BE LICENSED IN THE STATE OF
VERMONT AND QUALIFIED TO ISSUE THE TERRORISM POLICY IN ACCORDANCE WITH ALL LEGAL
REQUIREMENTS;
(VII)
SUCH CAPTIVE INSURANCE COMPANY SHALL QUALIFY FOR THE REINSURANCE
AND OTHER BENEFITS AFFORDED INSURANCE COMPANIES UNDER TRIA AND SHALL MAINTAIN
MINIMUM REINSURANCE OF NOT LESS THAN FIFTEEN PERCENT (15%) OF THE INSURED RISK
TO THE EXTENT COMMERCIALLY AVAILABLE;
(VIII)
NO GOVERNMENTAL AUTHORITY SHALL HAVE ISSUED ANY STATEMENT, OPINION,
FINDING OR DECREE THAT ANY INSURANCE COMPANY WHICH IS SIMILAR TO SUCH CAPTIVE
INSURANCE COMPANY (I.E., AN INSURANCE OWNED AND/OR CONTROLLED BY A PERSON
INSURED UNDER AN APPLICABLE INSURANCE POLICY) DOES NOT QUALIFY FOR