RESPECT TO A SIGNIFICANT CASUALTY, BORROWER SHALL
IMMEDIATELY ENDORSE, AND CAUSE ALL SUCH THIRD PARTIES TO ENDORSE, SUCH CHECK
PAYABLE TO THE ORDER OF LENDER. BORROWER HEREBY IRREVOCABLY APPOINTS LENDER AS
ITS ATTORNEY-IN-FACT, COUPLED WITH AN INTEREST, TO ENDORSE SUCH CHECK PAYABLE TO
THE ORDER OF LENDER.
THE EXPENSES INCURRED BY LENDER IN THE SETTLEMENT,
ADJUSTMENT AND COLLECTION OF THE PROCEEDS SHALL BECOME PART OF THE DEBT AND
SHALL BE REIMBURSED BY BORROWER TO LENDER UPON DEMAND. NOTWITHSTANDING ANYTHING
TO THE CONTRARY CONTAINED HEREIN, IF IN CONNECTION WITH A CASUALTY ANY INSURANCE
CARRIER MAKES A PAYMENT UNDER A PROPERTY INSURANCE POLICY THAT BORROWER PROPOSES
BE TREATED AS BUSINESS OR RENTAL INTERRUPTION INSURANCE, THEN, NOTWITHSTANDING
ANY DESIGNATION (OR LACK OF DESIGNATION) BY THE INSURANCE CARRIER AS TO THE
PURPOSE OF SUCH PAYMENT, AS BETWEEN LENDER AND BORROWER, SUCH PAYMENT SHALL NOT
BE TREATED AS BUSINESS OR RENTAL INTERRUPTION INSURANCE PROCEEDS UNLESS BORROWER
HAS DEMONSTRATED TO LENDER'S SATISFACTION THAT THE REMAINING NET PROCEEDS THAT
WILL BE RECEIVED FROM THE PROPERTY INSURANCE CARRIERS ARE SUFFICIENT TO PAY ONE
HUNDRED PERCENT (100%) OF THE COST OF FULLY RESTORING THE IMPROVEMENTS OR, IF
SUCH NET PROCEEDS ARE TO BE APPLIED TO REPAY THE DEBT IN ACCORDANCE WITH THE
TERMS HEREOF, THAT SUCH REMAINING NET PROCEEDS WILL BE SUFFICIENT TO PAY THE
DEBT IN FULL. ALL BUSINESS OR RENTAL INTERRUPTION PROCEEDS PAID TO LENDER SHALL
BE HELD BY LENDER AND APPLIED TO THE PAYMENT OF DEBT SERVICE AND RESERVES FROM
TIME TO TIME DUE AND PAYABLE WITH RESPECT TO THE LOAN AND, TO THE EXTENT LENDER
DETERMINES THAT THE CASH FLOW FROM THE PROPERTY OR (IF APPLICABLE) AMOUNTS IN
THE OPERATING EXPENSE SUBACCOUNT ARE NOT SUFFICIENT FOR SUCH PURPOSE, PAYMENT OF
OPERATING EXPENSES APPROVED BY LENDER.
7.3
CONDEMNATION.
7.3.1
NOTICE; RESTORATION. BORROWER SHALL PROMPTLY GIVE LENDER NOTICE OF
THE ACTUAL OR THREATENED COMMENCEMENT OF ANY CONDEMNATION OR EMINENT DOMAIN
PROCEEDING AFFECTING THE PROPERTY (A "CONDEMNATION") AND SHALL DELIVER TO LENDER
COPIES OF ANY AND ALL PAPERS SERVED IN CONNECTION WITH SUCH CONDEMNATION.
FOLLOWING THE OCCURRENCE OF A CONDEMNATION, BORROWER, REGARDLESS OF WHETHER AN
AWARD IS AVAILABLE (UNLESS LENDER HAS BREACHED ITS OBLIGATION (IF ANY) TO MAKE
SUCH AWARD AVAILABLE PURSUANT TO SECTION 7.4.1), SHALL PROMPTLY PROCEED TO
RESTORE, REPAIR, REPLACE OR REBUILD THE PROPERTY IN ACCORDANCE WITH LEGAL
REQUIREMENTS TO THE EXTENT PRACTICABLE TO BE OF AT LEAST EQUAL VALUE AND OF
SUBSTANTIALLY THE SAME CHARACTER (AND TO HAVE THE SAME UTILITY) AS PRIOR TO SUCH
CONDEMNATION.
7.3.2
COLLECTION OF AWARD. IF A CONDEMNATION OCCURS WHERE THE AWARD OR
PAYMENT IN RESPECT THEREOF (AN "AWARD") DOES NOT EXCEED $2,000,000 OR WHICH
RESULTS IN THE TAKING OF FIVE PERCENT (5%) OR LESS OF THE PROPERTY, PROVIDED NO
EVENT OF DEFAULT HAS OCCURRED AND IS CONTINUING, BORROWER MAY MAKE ANY
COMPROMISE, ADJUSTMENT OR SETTLEMENT IN CONNECTION WITH SUCH CONDEMNATION WITH
THE PRIOR WRITTEN CONSENT OF LENDER, NOT TO BE UNREASONABLY WITHHELD, PROVIDED
SUCH ADJUSTMENT IS CARRIED OUT IN A COMPETENT AND TIMELY MANNER, AND BORROWER IS
HEREBY AUTHORIZED