ANTICIPATED COST AND TIME REQUIRED FOR SUCH RESTORATION,
WHEREUPON BORROWER SHALL PROMPTLY NOTIFY LENDER OF SUCH GOOD FAITH ESTIMATE)
AND, PROVIDED THAT RESTORATION DOES NOT VIOLATE ANY LEGAL REQUIREMENTS, BORROWER
SHALL PROMPTLY COMMENCE AND DILIGENTLY PROSECUTE TO COMPLETION THE REPAIR,
RESTORATION OR REBUILDING OF THE PROPERTY SO DAMAGED OR DESTROYED TO A CONDITION
SUCH THAT THE PROPERTY SHALL BE AT LEAST EQUAL IN VALUE TO THAT IMMEDIATELY
PRIOR TO THE DAMAGE TO THE EXTENT PRACTICABLE, IN FULL COMPLIANCE WITH ALL LEGAL
REQUIREMENTS AND THE PROVISIONS OF ALL LEASES, AND IN ACCORDANCE WITH SECTION
3.04(B) BELOW.
SUCH REPAIR, RESTORATION OR REBUILDING OF THE PROPERTY
INCLUDING, WITHOUT LIMITATION, PREPARATION OF PLANS AND SPECIFICATIONS IN
CONNECTION THEREWITH, AND ALSO INCLUDING THE REPAIR AND REPLACEMENT OF
FURNITURE, FIXTURES AND EQUIPMENT, ARE SOMETIMES HEREINAFTER COLLECTIVELY
REFERRED TO AS THE "WORK".
(II)
BORROWER SHALL NOT ADJUST, COMPROMISE OR SETTLE ANY CLAIM FOR
INSURANCE PROCEEDS WITHOUT THE PRIOR WRITTEN CONSENT OF LENDER, WHICH SHALL NOT
BE UNREASONABLY WITHHELD OR DELAYED AND LENDER SHALL HAVE THE RIGHT, AT
BORROWER'S SOLE COST AND EXPENSE, TO PARTICIPATE IN ANY SETTLEMENT OR ADJUSTMENT
OF INSURANCE PROCEEDS; PROVIDED, HOWEVER, THAT, EXCEPT DURING THE CONTINUANCE OF
AN EVENT OF DEFAULT, LENDER'S CONSENT SHALL NOT BE REQUIRED WITH RESPECT TO THE
ADJUSTMENT, COMPROMISING OR SETTLEMENT OF ANY CLAIM FOR INSURANCE PROCEEDS IN AN
AMOUNT LESS THAN $250,000.
(III)
SUBJECT TO SECTION 3.04(A)(IV), LENDER SHALL APPLY ANY INSURANCE
PROCEEDS WHICH IT MAY RECEIVE TOWARDS THE WORK IN ACCORDANCE WITH SECTION
3.04(B) AND THE OTHER APPLICABLE SECTIONS OF THIS ARTICLE III.
(IV)
IF (A) AN EVENT OF DEFAULT SHALL HAVE OCCURRED AND BE CONTINUING,
(B) LENDER IS NOT REASONABLY SATISFIED THAT THE DEBT SERVICE COVERAGE, AFTER
SUBSTANTIAL COMPLETION OF
55
THE WORK, WILL BE AT LEAST EQUAL TO THE REQUIRED DEBT SERVICE COVERAGE, (C) MORE
THAN THIRTY PERCENT (30%) OF THE REASONABLY ESTIMATED FAIR MARKET VALUE OF THE
PROPERTY IS DAMAGED OR DESTROYED, (D) LENDER IS NOT REASONABLY SATISFIED THAT
THE WORK CAN BE COMPLETED SIX (6) MONTHS PRIOR TO MATURITY OR (E) LENDER IS NOT
REASONABLY SATISFIED THAT THE WORK CAN BE COMPLETED WITHIN TWELVE (12) MONTHS OF
THE DAMAGE TO OR DESTRUCTION OF THE PROPERTY (EACH, A "SUBSTANTIAL CASUALTY"),
LENDER SHALL HAVE THE OPTION, IN ITS SOLE DISCRETION TO APPLY ANY INSURANCE
PROCEEDS IT MAY RECEIVE PURSUANT TO THIS SECURITY INSTRUMENT (LESS ANY COST TO
LENDER OF RECOVERING AND PAYING OUT SUCH PROCEEDS INCURRED PURSUANT TO THE TERMS
HEREOF AND NOT OTHERWISE REIMBURSED TO LENDER, INCLUDING, WITHOUT LIMITATION,
REASONABLE ATTORNEYS' FEES AND EXPENSES) TO THE PAYMENT OF THE DEBT, WITHOUT ANY
PREPAYMENT FEE OR CHARGE OF ANY KIND, OR TO ALLOW SUCH PROCEEDS TO BE USED FOR
THE WORK PURSUANT TO THE TERMS AND SUBJECT TO THE CONDITIONS OF SECTION 3.04(B)
HEREOF AND THE OTHER APPLICABLE SECTIONS OF THIS ARTICLE III.
(V)
IN THE EVENT THAT LENDER ELECTS OR IS OBLIGATED HEREUNDER TO ALLOW
INSURANCE PROCEEDS TO BE USED FOR THE WORK, ANY EXCESS PROCEEDS REMAINING AFTER
COMPLETION OF SUCH WORK SHALL BE