AS
78
ADDITIONAL SECURITY FOR PAYMENT OF THE DEBT.
UNTIL EXPENDED OR APPLIED IN
ACCORDANCE HEREWITH, THE RESERVE FUNDS SHALL CONSTITUTE ADDITIONAL SECURITY FOR
THE DEBT.
7.5.2
UPON THE OCCURRENCE OF AN EVENT OF DEFAULT, LENDER MAY, IN ADDITION
TO ANY AND ALL OTHER RIGHTS AND REMEDIES AVAILABLE TO LENDER, APPLY ANY SUMS
THEN PRESENT IN ANY OR ALL OF THE RESERVE FUNDS TO THE PAYMENT OF THE DEBT IN
ANY ORDER IN ITS SOLE DISCRETION.
7.5.3
THE RESERVE FUNDS SHALL NOT CONSTITUTE TRUST FUNDS AND MAY BE
COMMINGLED WITH OTHER MONIES HELD BY LENDER.
7.5.4
ALL OF THE RESERVE FUNDS OTHER THAN THE TAX AND INSURANCE ESCROW
FUND SHALL BE PLACED IN INTEREST BEARING ACCOUNTS AND ANY INTEREST EARNED
THEREON, LESS A SERVICING FEE OF ONE-QUARTER OF ONE PERCENT (0.25%) PER ANNUM
(BUT IN NO EVENT MORE THAN THE INTEREST EARNED), SHALL BE ADDED TO AND BECOME A
PART OF SUCH RESERVE FUND.
BORROWER SHALL BE RESPONSIBLE FOR PAYMENT OF ANY
FEDERAL, STATE OR LOCAL INCOME OR OTHER TAX APPLICABLE TO THE INTEREST EARNED ON
SUCH RESERVE FUNDS WHICH IS CREDITED OR PAID TO BORROWER.
7.5.5
BORROWER SHALL NOT, WITHOUT OBTAINING THE PRIOR WRITTEN CONSENT OF
LENDER, FURTHER PLEDGE, ASSIGN OR GRANT ANY SECURITY INTEREST IN ANY RESERVE
FUND OR THE MONIES DEPOSITED THEREIN OR PERMIT ANY LIEN OR ENCUMBRANCE TO ATTACH
THERETO, OR ANY LEVY TO BE MADE THEREON, OR ANY UCC-1 FINANCING STATEMENTS,
EXCEPT THOSE NAMING LENDER AS THE SECURED PARTY, TO BE FILED WITH RESPECT
THERETO.
7.5.6
LENDER SHALL NOT BE LIABLE FOR ANY LOSS SUSTAINED ON THE INVESTMENT
OF ANY FUNDS CONSTITUTING THE RESERVE FUNDS UNLESS OCCASIONED BY THE GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT OF LENDER.
7.5.7
UPON PAYMENT IN FULL OF THE DEBT AND PERFORMANCE OF ALL OTHER
OBLIGATIONS UNDER THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS, LENDER SHALL
DISBURSE TO BORROWER ALL REMAINING RESERVE FUNDS.
SECTION 7.6
LETTER OF CREDIT RIGHTS.
ANY LETTER OF CREDIT DELIVERED
TO LENDER PURSUANT TO THIS AGREEMENT SHALL BE HELD BY LENDER AS ADDITIONAL
SECURITY FOR THE LOAN.
LENDER SHALL HAVE THE RIGHT TO DRAW UPON ANY LETTER OF
CREDIT IMMEDIATELY AND WITHOUT FURTHER NOTICE:
(A)
UPON THE OCCURRENCE AND DURING THE CONTINUANCE OF AN EVENT OF
DEFAULT;
(B)
IF BORROWER FAILS TO DELIVER TO LENDER, NO LESS THAN THIRTY (30)
DAYS PRIOR TO THE EXPIRATION OF ANY LETTER OF CREDIT (INCLUDING ANY RENEWAL OR
EXTENSION THEREOF), A RENEWAL OR EXTENSION OF SUCH LETTER OF CREDIT OR A
REPLACEMENT LETTER OF CREDIT; OR
(C)
IF THE INSTITUTION ISSUING THE LETTER OF CREDIT CEASES TO BE AN
ELIGIBLE INSTITUTION AND BORROWER FAILS TO DELIVER TO LENDER A REPLACEMENT
LETTER OF CREDIT FROM AN ELIGIBLE INSTITUTION WITHIN THIRTY (30) DAYS OF THE
DATE THAT SUCH INSTITUTION CEASED TO BE AN ELIGIBLE INSTITUTION.
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ARTICLE 8 - DEFAULTS
SECTION 8.1
EVENT OF DEFAULT.
(A)
EACH OF THE FOLLOWING EVENTS SHALL CONSTITUTE AN EVENT OF DEFAULT
HEREUNDER (AN "EVENT OF DEFAULT"):
(I)
IF (A) ANY PORTION OF THE PRINCIPAL OR