Common use of Casualties Clause in Contracts

Casualties. Trustor shall give prompt written notice to Beneficiary upon the occurrence of casualty to or in connection with the Security or any part thereof, whether or not covered by insurance. In the event of such casualty Trustor hereby absolutely and unconditionally assigns to Beneficiary all insurance proceeds which it may be entitled to receive and such proceeds shall be delivered to and held by Beneficiary to be applied to Beneficiary’s expenses in settling, prosecuting or defending any insurance claim, and then to the restoration of any portion of the Security that has been damaged or destroyed to the same condition, character and value as existed prior to such damage or destruction so long as the following conditions are satisfied: (i) Trustor is not in default hereunder (other than any default resulting from such casualty), (ii) Beneficiary’s security is not materially impaired, (iii) all income (from the Security or otherwise) required to pay all debt service and operating expenses of the Security during such restoration and thereafter will be equal to or greater than the income which was required to pay such debt service and operating expenses prior to the casualty, (iv) Trustor evidences to the satisfaction of Beneficiary that the insurance required to be maintained hereunder will be available to the Trustor during restoration and thereafter, (v) Beneficiary shall have approved the plans and specifications for such restoration, which approval shall not be unreasonably withheld or delayed, and (vi) in the event that in Beneficiary’s sole judgment the insurance proceeds and any amounts deposited with a senior lender are not sufficient to accomplish restoration, Trustor deposits with the Beneficiary or senior lender, as required by that senior lender pursuant to the terms of the senior Debt Instrument, within five days of demand by Beneficiary, the additional amounts necessary to accomplish restoration. Proceeds disbursed for restoration will be released to Trustor in accordance with Beneficiary’s then current customary disbursement procedures. In the event any of the conditions set forth above are not satisfied or if the insurance proceeds shall not be applied to the restoration of the Security within thirty days after receipt of such proceeds by Beneficiary, Beneficiary may release such proceeds to Trustor without such release being deemed a payment of any indebtedness secured hereby, rather than apply such proceeds to the restoration of the Security. Such application or release shall not cure or waive any default or notice of default hereunder or invalidate any act done pursuant to such notice. If the Security is restored at a cost less than the available insurance proceeds, then such excess proceeds shall, if Trustor is not then in default hereunder, be paid over to Trustor. Beneficiary may commence, appear in, defend or prosecute any assigned claim or action, and may adjust, compromise, settle and collect all claims, proceeds and awards assigned to Beneficiary, but shall not be responsible for any failure to collect any claim, proceeds or award, regardless of the cause of the failure.

Casualties. (a) Trustor shall give prompt written notice will promptly notify Beneficiary in writing after any loss or damage caused by fire or other casualty to the Property, and prior to the making of any repairs. Trustor will furnish to Beneficiary upon within sixty (60) days after the occurrence loss or damage the following: (1) evidence satisfactory to Beneficiary of casualty the cost of repair or reconstruction; (2) evidence satisfactory to Beneficiary that sufficient funds are available or committed for the benefit of Beneficiary, including insurance proceeds, payment and performance bonds, or otherwise, to complete the repair or reconstruction; and (3) evidence satisfactory to Beneficiary that the repair or reconstruction may be completed in connection accordance with all applicable laws, rules, regulations, and ordinances and that all necessary permits and approvals have been or will be obtained. If Trustor does not furnish this evidence to Beneficiary within the Security sixty- day period, or any part thereofif Beneficiary in its reasonable discretion determines that repair or reconstruction is not economically feasible, whether or not covered by insurancethen within sixty (60) days after the expiration of the sixty-day period, Beneficiary will have the option ("REPAYMENT OPTION") to have all insurance proceeds applied against the Indebtedness. In If Beneficiary elects the event of such casualty Repayment Option, Trustor hereby absolutely and unconditionally assigns will immediately transfer to Beneficiary all insurance proceeds which it may be entitled received by it, if any, to receive the extent of the Indebtedness, and such Beneficiary will apply the insurance proceeds shall be delivered to and received by it, if any, against the Indebtedness. If the insurance proceeds held by Trustor and Beneficiary exceed the Indebtedness, any excess insurance proceeds will belong and be paid over to, or be retained, by Trustor. (b) If Beneficiary does not elect the Repayment Option within the specified time period, Trustor will, with all diligence, repair or otherwise reconstruct the damage to the Property, all according to the original plans and specifications for the Improvements or any modified plans and specifications conforming to the then laws and regulations as will first have been approved in writing by Beneficiary and any occupants of the Improvements having the right to approve. Beneficiary will use all insurance proceeds, if any, received by it relating to the damage or destruction to reimburse Trustor from time to time for expenditures made for repair of the damage or for the erection of any building, structure, or improvements in their place if permitted as follows: (1) At the end of each month against Trustor's architect's certificate, an amount that will be that proportion of the insurance proceeds held in trust that ninety percent (90%) of the payments to be made to the contractors or materialmen for work done, materials supplied, and services rendered during that month bears to the total contract price. (2) At the completion of the work, the balance of the proceeds required for completing the payments for the work will be paid to or for the account of Trustor, provided that at the time of the payment: (i) there are no liens (as evidenced by an endorsement satisfactory to Beneficiary issued by Trustee) against the Property by reason of the work, or proof satisfactory to Beneficiary has been submitted that all costs of the work have been paid; and (ii) Trustor's architect will certify that all required work is completed and is proper and of a quality and class of the original work required by the original plans and specifications and in accordance with the approved plans and specifications. If the insurance proceeds exceed the costs of completing the work, the excess insurance proceeds will belong and be retained by or be paid over to Beneficiary to be applied to Beneficiary’s expenses in settling, prosecuting or defending any insurance claim, and then to against the restoration of any portion of the Security that has been damaged or destroyed to the same condition, character and value as existed prior to such damage or destruction so long as the following conditions are satisfied: (i) Trustor is not in default hereunder (other than any default resulting from such casualty), (ii) Beneficiary’s security is not materially impaired, (iii) all income (from the Security or otherwise) required to pay all debt service and operating expenses of the Security during such restoration and thereafter will be equal to or greater than the income which was required to pay such debt service and operating expenses prior to the casualty, (iv) Trustor evidences to the satisfaction of Beneficiary that the insurance required to be maintained hereunder will be available to the Trustor during restoration and thereafter, (v) Beneficiary shall have approved the plans and specifications for such restoration, which approval shall not be unreasonably withheld or delayed, and (vi) in the event that in Beneficiary’s sole judgment the insurance proceeds and any amounts deposited with a senior lender are not sufficient to accomplish restoration, Trustor deposits with the Beneficiary or senior lender, as required by that senior lender pursuant to the terms of the senior Debt Instrument, within five days of demand by Beneficiary, the additional amounts necessary to accomplish restoration. Proceeds disbursed for restoration will be released to Trustor in accordance with Beneficiary’s then current customary disbursement procedures. In the event any of the conditions set forth above are not satisfied or if the insurance proceeds shall not be applied to the restoration of the Security within thirty days after receipt of such proceeds by Beneficiary, Beneficiary may release such proceeds to Trustor without such release being deemed a payment of any indebtedness secured hereby, rather than apply such proceeds to the restoration of the Security. Such application or release shall not cure or waive any default or notice of default hereunder or invalidate any act done pursuant to such noticeIndebtedness. If the Security is restored at a cost less than costs of completing the available work exceed the insurance proceeds, then such excess proceeds Trustor will, no later than ninety (90) days before commencement of the work, provide evidence satisfactory to beneficiary that Trustor has the funds to complete the work and shall, if Trustor is not then in default hereunder, be paid over to Trustor. Beneficiary may commence, appear in, defend or prosecute any assigned claim or action, and may adjust, compromise, settle and collect all claims, proceeds and awards assigned to Beneficiary, but shall not be responsible for any failure to collect any claim, proceeds or award, regardless before commencement of the cause of work, deposit with Beneficiary said funds which shall be used to reimburse Trustor in the failuresame manner as insurance proceeds.

Casualties. Trustor shall give prompt (a) If prior to the Closing Date, all or any part of the Owned Real Property or the other assets of the Company are damaged by reason of earthquake, flood, fire, windstorm, hail, explosion or other casualty, Seller will immediately deliver written notice to Beneficiary upon the occurrence of casualty to or in connection with the Security or any part thereof, whether or not covered by insurance. In the event Buyer of such casualty Trustor hereby absolutely and unconditionally assigns to Beneficiary all insurance proceeds which it may be entitled to receive and such proceeds shall be delivered to and held by Beneficiary to be applied to Beneficiary’s expenses in settling, prosecuting or defending any insurance claim, and then to the restoration of any portion of the Security that has been damaged or destroyed to the same condition, character and value as existed prior to such damage or destruction so long as the following conditions are satisfied: fact. If (i) Trustor is not in default hereunder the cost of repairing such damage (other than after being reduced or offset by any default resulting insurance proceeds to be made available to Buyer and any sums that Seller agrees to make available (such amount from such casualtySeller, the “Seller Casualty Contribution”), ) will exceed fifteen million dollars ($15,000,000) and/or (ii) Beneficiary’s security is not materially impaired, (iii) all income (from the Security or otherwise) required to pay all debt service and operating expenses Buyer reasonably expects that restoration of the Security during such restoration and thereafter will be equal Owned Real Property to or greater than substantially the income which was required to pay such debt service and operating expenses condition existing prior to the casualtyoccurrence thereof is not possible or will take longer than six (6) months (in either case, a “Material Casualty Event”), Buyer will have the option, to be exercised within thirty (iv30) Trustor evidences days of receipt of such notice from Seller (but in any event no later than the Closing Date), to terminate this Agreement upon delivery of written notice thereof to Seller, in which case the Initial Payment (including earnings thereon) and the Escrow Amount (including earnings thereon) will be returned to Buyer. If Buyer fails to elect to terminate this Agreement within such period or if the actual cost to repair the damage to the satisfaction Owned Real Property or the other assets of Beneficiary that the insurance required Company (after being reduced or offset by funds made or to be maintained hereunder made available from insurance or the Seller Casualty Contribution) will be available not exceed fifteen million dollars ($15,000,000), then Seller will make an assignment of insurance proceeds (including, without limitation, the proceeds of any business interruption insurance applicable to the Trustor during restoration and thereafter, period after Closing) effective upon the Closing (v) Beneficiary shall have approved the plans and specifications for such restoration, which approval shall not be unreasonably withheld or delayed, and (vi) in the event that in Beneficiary’s sole judgment the insurance proceeds and less any amounts deposited expended prior to Closing by Seller in addressing the damage caused by the casualty event) and provide Buyer with a senior lender are not sufficient to accomplish restoration, Trustor deposits with credit against the Beneficiary or senior lender, as required by that senior lender pursuant Purchase Price in an amount equal to the terms Seller Casualty Contribution (the “Casualty Credit”). (b) Prior to the Closing Date or termination of the senior Debt Instrument, within five days of demand by Beneficiary, the additional amounts necessary to accomplish restoration. Proceeds disbursed for restoration will be released to Trustor this Agreement in accordance with Beneficiary’s then current customary disbursement procedures. In the event any of the conditions set forth above are this Section 9.3, Seller will not satisfied or if the insurance proceeds shall not be applied to the restoration of the Security within thirty days after receipt of such proceeds by Beneficiary, Beneficiary may release such proceeds to Trustor without such release being deemed a payment of any indebtedness secured hereby, rather than apply such proceeds to the restoration of the Security. Such application or release shall not cure or waive any default or notice of default hereunder or invalidate any act done pursuant to such notice. If the Security is restored at a cost less than the available insurance proceeds, then such excess proceeds shall, if Trustor is not then in default hereunder, be paid over to Trustor. Beneficiary may commencedesignate counsel, appear in, defend or prosecute otherwise act with respect to recovery of, or settlement of any assigned claim or actionfor, and may adjust, compromise, settle and collect all claims, proceeds and awards assigned to Beneficiary, but shall not be responsible for any failure to collect any claim, proceeds or award, regardless of the cause of the failureinsurance proceedings without Buyer’s prior written consent.

Casualties. Trustor Risk of loss with respect to the Purchased Assets shall give prompt remain with Seller until the Closing, and thereafter with Purchaser. Therefore, the parties agree as follows: (a) If any damage to any of the Purchased Assets shall occur prior to the Closing Date by reason of fire, windstorm, earthquake, hail, explosion or other casualty, and if, in Purchaser's reasonable judgment, the aggregate cost of repairing such damage will equal or exceed Five Hundred Thousand Dollars ($500,000.00), Purchaser may elect to (i) terminate this Agreement by giving written notice to Beneficiary upon Seller in which event the occurrence Deposit Monies and interest thereon will be returned to Purchaser, and thereupon neither party shall have any further obligations or liability whatsoever to the other hereunder or (ii) receive an assignment of casualty all of Seller's rights to or in connection with the Security or any part thereof, whether or not covered by insurance. In the event of such casualty Trustor hereby absolutely and unconditionally assigns to Beneficiary all insurance proceeds which it may be entitled to receive and such proceeds shall be delivered to and held by Beneficiary to be applied to Beneficiary’s expenses in settling, prosecuting or defending any insurance claim, and then to the restoration of any portion of the Security that has been damaged or destroyed to the same condition, character and value as existed prior (including business interruption proceeds) relating to such damage or destruction so long as (and a credit against the following conditions are satisfied: Purchase Price for any such proceeds received by Seller) and acquire the Purchased Assets without any adjustment in the Purchase Price in connection therewith provided that, in such latter event, Seller shall pay to Purchaser the amount of any deductible under applicable insurance policies and uninsured claims. (ib) Trustor is If, in Purchaser's reasonable judgment, the cost of repairing such damage will not in default hereunder exceed Five Hundred Thousand Dollars (other than any default resulting from such casualty$500,000.00), the transactions contemplated hereby shall close without any adjustment in the Purchase Price in connection therewith, Purchaser shall receive an assignment of all of Seller's rights to any insurance proceeds (iiincluding business interruption proceeds) Beneficiary’s security is (and a credit against the Purchase Price for any such proceeds received by Seller), and Seller shall pay to Purchaser the amount of any deductible under applicable insurance policies and uninsured claims. (c) If Purchaser does not materially impairedterminate this Agreement as provided in subparagraph (a) hereof, (iii) all income (from the Security or otherwise) required to pay all debt service then any insurance proceeds covering business interruption losses shall be apportioned between Seller and operating expenses of the Security during such restoration and thereafter will be equal to or greater than the income which was required to pay such debt service and operating expenses prior Purchaser to the casualty, (iv) Trustor evidences to the satisfaction of Beneficiary that the insurance required to be maintained hereunder will be available to the Trustor during restoration and thereafter, (v) Beneficiary shall have approved the plans and specifications for such restoration, which approval shall not be unreasonably withheld or delayed, and (vi) in the event that in Beneficiary’s sole judgment the insurance proceeds and any amounts deposited with a senior lender are not sufficient to accomplish restoration, Trustor deposits with the Beneficiary or senior lender, as required by that senior lender pursuant to the terms of the senior Debt Instrument, within five days of demand by Beneficiary, the additional amounts necessary to accomplish restoration. Proceeds disbursed for restoration will be released to Trustor in accordance with Beneficiary’s then current customary disbursement procedures. In the event any of the conditions set forth above are not satisfied or if the insurance proceeds shall not be applied to the restoration of the Security within thirty days after receipt of such proceeds by Beneficiary, Beneficiary may release such proceeds to Trustor without such release being deemed a payment of any indebtedness secured hereby, rather than apply such proceeds to the restoration of the Security. Such application or release shall not cure or waive any default or notice of default hereunder or invalidate any act done pursuant to such notice. If the Security is restored at a cost less than the available insurance proceeds, then such excess proceeds shall, if Trustor is not then in default hereunder, be paid over to Trustor. Beneficiary may commence, appear in, defend or prosecute any assigned claim or action, and may adjust, compromise, settle and collect all claims, proceeds and awards assigned to Beneficiary, but shall not be responsible for any failure to collect any claim, proceeds or award, regardless of the cause of the failureClosing Date.

Casualties. Trustor (a) If any damage to the Real Property shall give prompt occur prior to the Closing Date by reason of fire, windstorm, earthquake, hail, explosion, hurricane or other casualty, and if the cost of repairing such damage will equal or exceed Two Million Eight Hundred Thousand Dollars ($2,800,000.00), Seller shall promptly notify Purchaser and Purchaser may then elect to (i) terminate this Agreement by giving written notice to Beneficiary upon Seller, whereupon Escrow Company shall immediately return the occurrence Deposit to Purchaser, the Parties shall each pay one-half of casualty the costs of the Escrow, and neither party to this Agreement shall thereafter have any further rights or liabilities under this Agreement, except for the Surviving Obligations, or (ii) receive an assignment of all of Seller’s claims in connection with the Security or therewith and any part thereof, whether or not covered by insurance. In the event of such casualty Trustor hereby absolutely and unconditionally assigns rights to Beneficiary all any insurance proceeds which it may be entitled (excluding business interruption proceeds for the period prior to receive and such proceeds shall be delivered to and held by Beneficiary to be applied to Beneficiary’s expenses in settling, prosecuting or defending any insurance claim, and then to the restoration of any portion of the Security that has been damaged or destroyed to the same condition, character and value as existed prior Closing) relating to such damage or destruction so long as and acquire the following conditions are satisfied: Property with appropriate adjustments to the Purchase Price equal to the deductible under the applicable insurance policy (i) Trustor to the extent such deductible is not in default hereunder (other than applied by Seller for repairs prior to Closing) and the reasonable costs and expenses incurred by Seller to negotiate or settle any default resulting from casualty claim with an insurer and to stabilize the Property following such casualty. (b) If the cost of repairing such damage will not exceed Two Million Eight Hundred Thousand Dollars ($2,800,000.00), the transactions contemplated hereby shall close with appropriate adjustments to the Purchase Price equal to the deductible under the applicable insurance policy (ii) Beneficiary’s security to the extent such deductible is not materially impaired, (iii) all income (from the Security or otherwise) required to pay all debt service and operating expenses of the Security during such restoration and thereafter will be equal to or greater than the income which was required to pay such debt service and operating expenses applied by Seller for repairs prior to the casualty, (ivClosing) Trustor evidences and the costs and expenses incurred by Seller to negotiate or settle any casualty claim with an insurer and to stabilize the satisfaction Property following such casualty and Purchaser shall receive an assignment of Beneficiary that the insurance required all of Seller’s rights to be maintained hereunder will be available to the Trustor during restoration and thereafter, (v) Beneficiary shall have approved the plans and specifications for such restoration, which approval shall not be unreasonably withheld or delayed, and (vi) in the event that in Beneficiary’s sole judgment the any insurance proceeds and any amounts deposited with a senior lender are not sufficient (excluding business interruption proceeds for the period prior to accomplish restoration, Trustor deposits with the Beneficiary or senior lender, as required by that senior lender pursuant to the terms of the senior Debt Instrument, within five days of demand by Beneficiary, the additional amounts necessary to accomplish restoration. Proceeds disbursed for restoration will be released to Trustor in accordance with Beneficiary’s then current customary disbursement procedures. In the event any of the conditions set forth above are not satisfied or if the insurance proceeds shall not be applied to the restoration of the Security within thirty days after receipt of such proceeds by Beneficiary, Beneficiary may release such proceeds to Trustor without such release being deemed a payment of any indebtedness secured hereby, rather than apply such proceeds to the restoration of the Security. Such application or release shall not cure or waive any default or notice of default hereunder or invalidate any act done pursuant to such notice. If the Security is restored at a cost less than the available insurance proceeds, then such excess proceeds shall, if Trustor is not then in default hereunder, be paid over to Trustor. Beneficiary may commence, appear in, defend or prosecute any assigned claim or action, and may adjust, compromise, settle and collect all claims, proceeds and awards assigned to Beneficiary, but shall not be responsible for any failure to collect any claim, proceeds or award, regardless of the cause of the failureClosing).

Casualties. Trustor shall give prompt written notice thereof to Beneficiary upon after the occurrence happening of any casualty to or in connection with the Security Property or any part thereof, whether or not covered by insuranceinsurance if the damages caused thereby exceed $25,000. In the event of such casualty casualty, the gross proceeds of the insurance relating to such Property (the "PROCEEDS"), less all expenses (including attorneys' fees) incurred in the collection of such Proceeds, shall be payable to Beneficiary, and Trustor hereby absolutely authorizes and unconditionally assigns directs any affected insurance company to Beneficiary all insurance proceeds which it may be entitled to receive and make payment of such proceeds shall be delivered to and held by Beneficiary to be applied Proceeds in such a case directly to Beneficiary’s expenses in settling, prosecuting or defending . If Trustor receives any insurance claim, and then to the restoration of any portion of the Security that has been damaged or destroyed to the same condition, character and value as existed prior to such damage or destruction so long as the following conditions are satisfied: (i) Trustor is not in default hereunder (other than any default Proceeds resulting from such casualty, Trustor shall promptly pay over such Proceeds to Beneficiary. Beneficiary is hereby authorized and empowered by Trustor, at Beneficiary's option and in Beneficiary's sole discretion, as attorney-in-fact for Trustor, with full power of substitution, to make proof of loss, to appear in and prosecute any action arising from any policy or policies of insurance, and upon the occurrence of an Event of Default (as defined in Section 8.01 below), (ii) Beneficiary’s security is to settle, adjust, or compromise any material claim for loss, damage or destruction under any policy or policies of insurance. The appointment granted herein shall be deemed to be a power coupled with an interest. Trustor shall not materially impairedsettle, (iii) all income (from the Security adjust or otherwise) required to pay all debt service and operating expenses compromise any claim for loss, damage or destruction of the Security during such restoration and thereafter will be equal to Property or greater than any part thereof under any policy or policies of insurance without the income which was required to pay such debt service and operating expenses prior to the casualty, (iv) Trustor evidences to the satisfaction written consent of Beneficiary that the insurance required to be maintained hereunder will be available to the Trustor during restoration and thereaftersuch settlement, (v) Beneficiary shall have approved the plans and specifications for such restoration, which approval shall not be unreasonably withheld adjustment or delayed, and (vi) in the event that in Beneficiary’s sole judgment the insurance proceeds and any amounts deposited with a senior lender are not sufficient to accomplish restoration, Trustor deposits with the Beneficiary or senior lender, as required by that senior lender pursuant to the terms of the senior Debt Instrument, within five days of demand by Beneficiary, the additional amounts necessary to accomplish restoration. Proceeds disbursed for restoration will be released to Trustor in accordance with Beneficiary’s then current customary disbursement procedurescompromise. In the event of any damage to or destruction of the conditions set forth above are not satisfied Property, all, or if any part, of the insurance proceeds shall not may be applied to the Secured Obligations or to the restoration and repair of the Security within thirty days after receipt Property, as Beneficiary may determine in its sole and absolute discretion; provided, however, that if Beneficiary requires Trustor to restore and repair the Property, then Beneficiary shall pay to Trustor all Proceeds up to the amount required to complete such restoration and repair. Nothing herein contained shall be deemed to excuse Trustor from repairing or maintaining the Property as provided in Section 4.02 above, or restoring all damage or destruction to the Property, regardless of whether or not there 8 SWI ARIZONA DEED OF TRUST 9 are Proceeds available to Trustor or whether any such proceeds Proceeds are sufficient in amount; provided, however, if Proceeds are applied to the restoration or repair of the Property by Beneficiary, Trustor shall not be obligated to pay for repair and restoration up to the amount of Proceeds so available, but shall be nevertheless liable for any amounts exceeding available Proceeds for the restoration and repair of the Property. Application or release by Beneficiary may release such proceeds to Trustor without such release being deemed a payment of any indebtedness secured hereby, rather than apply such proceeds to the restoration of the Security. Such application or release Proceeds shall not cure or waive any default or default, notice of default hereunder or Event of Default under this Deed of Trust or invalidate any act done pursuant to such notice. If the Security is restored at a cost less than the available insurance proceeds, then such excess proceeds shall, if Trustor is not then in default hereunder, be paid over to Trustor. Beneficiary may commence, appear in, defend or prosecute any assigned claim or action, and may adjust, compromise, settle and collect all claims, proceeds and awards assigned to Beneficiary, but shall not be responsible for any failure to collect any claim, proceeds or award, regardless notice of the cause of the failuredefault.

Casualties. (a) Trustor shall give prompt written notice will promptly notify Beneficiary in writing after any loss or damage caused by fire or other casualty to the Property in excess of $100,000, and prior to the making of any repairs. Trustor will furnish to Beneficiary upon within ninety (90) days after the occurrence loss or damage the following: (i) evidence satisfactory to Beneficiary of casualty the cost of repair or reconstruction; (ii) evidence satisfactory to Beneficiary that sufficient funds are available or committed for the benefit of Beneficiary, including insurance proceeds, payment and performance bonds, or otherwise, to complete the repair or reconstruction; and (iii) evidence satisfactory to Beneficiary that the repair or reconstruction may be completed in connection accordance with all applicable laws, rules, regulations, and ordinances and that all necessary permits and approvals have been or will be obtained. If Trustor does not furnish this evidence to Beneficiary within the Security ninety-day period, or any part thereofif Beneficiary in its sole discretion determines that repair or reconstruction is not economically feasible, whether or not covered by insurancethen within thirty (30) days after the expiration of the ninety-day period, Beneficiary will have the option (in this Deed of Trust, Repayment Option") to have all insurance proceeds applied against the Indebtedness. In If Beneficiary elects the event of such casualty Repayment Option, Trustor hereby absolutely and unconditionally assigns will immediately transfer to Beneficiary all insurance proceeds which it may be entitled received by it, if any, to receive the extent of the Indebtedness, and such Beneficiary will apply the insurance proceeds shall be delivered to and received by it, if any, against the Indebtedness. If the insurance proceeds held by Trustor and Beneficiary will exceed the Indebtedness, any excess insurance proceeds will belong and be paid over to or be retained by Trustor. (b) If Beneficiary does not elect the Repayment Option within the specified time period, Trustor will with all diligence repair or otherwise reconstruct the damage to the Property, all according to the original plans and specifications for the improvements and elevations or any modified plans and specifications conforming to the then laws and regulations as will first have been approved in writing by Beneficiary and any occupants of the Improvements having the right to approve. Beneficiary will use all insurance proceeds, if any, received by it relating to the damage or destruction to reimburse Trustor from time to time for expenditures made for repair of the damage or for the erection of any building, structure, or improvements in their place if permitted as follows: (i) At the end of each month against Trustor's architect's certificate, an amount that will be that proportion of the insurance proceeds held in trust that eighty-five percent (85%) of the payments to be made to the contractors or materialmen for work done, materials supplied, and services rendered during that month bears to the total contract price. (ii) At the completion of the work, the balance of the proceeds required for completing the payments for the work will be paid to or for the account of Trustor, provided that at the time of the payment: (1) there are no liens (as evidenced by an endorsement satisfactory to Beneficiary issued by Trustee) against the Property by reason of the work, or proof satisfactory to Beneficiary has been submitted that all costs of the work have been paid; and (2) Trustor's architect will certify that all required work is completed and is proper and of a quality and class of the original work required by the original plans and specifications and in accordance with the approved plans and specifications. If the insurance proceeds exceed the costs of completing the work, the excess insurance proceeds will belong and be retained by or be paid over to Beneficiary to be applied to Beneficiary’s expenses in settling, prosecuting or defending any insurance claim, and then to against the restoration of any portion of the Security that has been damaged or destroyed to the same condition, character and value as existed prior to such damage or destruction so long as the following conditions are satisfied: (i) Trustor is not in default hereunder (other than any default resulting from such casualty), (ii) Beneficiary’s security is not materially impaired, (iii) all income (from the Security or otherwise) required to pay all debt service and operating expenses of the Security during such restoration and thereafter will be equal to or greater than the income which was required to pay such debt service and operating expenses prior to the casualty, (iv) Trustor evidences to the satisfaction of Beneficiary that the insurance required to be maintained hereunder will be available to the Trustor during restoration and thereafter, (v) Beneficiary shall have approved the plans and specifications for such restoration, which approval shall not be unreasonably withheld or delayed, and (vi) in the event that in Beneficiary’s sole judgment the insurance proceeds and any amounts deposited with a senior lender are not sufficient to accomplish restoration, Trustor deposits with the Beneficiary or senior lender, as required by that senior lender pursuant to the terms of the senior Debt Instrument, within five days of demand by Beneficiary, the additional amounts necessary to accomplish restoration. Proceeds disbursed for restoration will be released to Trustor in accordance with Beneficiary’s then current customary disbursement procedures. In the event any of the conditions set forth above are not satisfied or if the insurance proceeds shall not be applied to the restoration of the Security within thirty days after receipt of such proceeds by Beneficiary, Beneficiary may release such proceeds to Trustor without such release being deemed a payment of any indebtedness secured hereby, rather than apply such proceeds to the restoration of the Security. Such application or release shall not cure or waive any default or notice of default hereunder or invalidate any act done pursuant to such noticeIndebtedness. If the Security is restored at a cost less than costs of completing the available work exceed the insurance proceeds, then such excess proceeds shall, if Trustor is not then in default hereunder, be paid over to Trustor. Beneficiary may commence, appear in, defend or prosecute any assigned claim or action, and may adjust, compromise, settle and collect all claims, proceeds and awards assigned to Beneficiary, but shall not be responsible for any failure to collect any claim, proceeds or award, regardless will pay the balance of the cause costs of completing the failurework within thirty (30) days after the completion.

Casualties. Trustor (a) If any damage to the Real Property shall give prompt occur prior to the Closing Date by reason of fire, windstorm, earthquake, hail, explosion, hurricane or other casualty, Seller shall promptly notify Purchaser. If the cost of repairing such damage will equal or exceed Four Million Two Hundred Fifty Thousand Dollars ($4,250,000.00), Purchaser may then elect to (i) terminate this Agreement by giving written notice to Beneficiary upon Seller, whereupon Escrow Company shall immediately return the occurrence Deposit to Purchaser, the Parties shall each pay one-half of casualty the costs of the escrow, and neither party to this Agreement shall thereafter have any further rights or liabilities under this Agreement, except for the Surviving Obligations, or (ii) receive an assignment of all of Seller’s claims in connection with the Security or therewith and any part thereof, whether or not covered by insurance. In the event of such casualty Trustor hereby absolutely and unconditionally assigns rights to Beneficiary all any insurance proceeds which it may be entitled (excluding business interruption proceeds for the period prior to receive and such proceeds shall be delivered to and held by Beneficiary to be applied to Beneficiary’s expenses in settling, prosecuting or defending any insurance claim, and then to the restoration of any portion of the Security that has been damaged or destroyed to the same condition, character and value as existed prior Closing) relating to such damage or destruction so long as and acquire the following conditions are satisfied: Property with appropriate adjustments to the Purchase Price equal to the deductible under the applicable insurance policy (i) Trustor to the extent such deductible is not in default hereunder (other than applied by Seller for repairs prior to Closing) and the reasonable costs and expenses incurred by Seller to negotiate or settle any default resulting from casualty claim with an insurer and to stabilize the Property following such casualty. (b) If the cost of repairing such damage will not exceed Four Million Two Hundred Fifty Thousand Dollars ($4,250,000.00), the transactions contemplated hereby shall close with appropriate adjustments to the Purchase Price equal to the deductible under the applicable insurance policy (ii) Beneficiary’s security to the extent such deductible is not materially impaired, (iii) all income (from the Security or otherwise) required to pay all debt service and operating expenses of the Security during such restoration and thereafter will be equal to or greater than the income which was required to pay such debt service and operating expenses applied by Seller for repairs prior to the casualty, (ivClosing) Trustor evidences and the costs and expenses incurred by Seller to negotiate or settle any casualty claim with an insurer and to stabilize the satisfaction Property following such casualty and Purchaser shall receive an assignment of Beneficiary that the insurance required ACTIVE/85506504.17 LEGAL_US_W # 85494519.11 all of Seller’s rights to be maintained hereunder will be available to the Trustor during restoration and thereafter, (v) Beneficiary shall have approved the plans and specifications for such restoration, which approval shall not be unreasonably withheld or delayed, and (vi) in the event that in Beneficiary’s sole judgment the any insurance proceeds and any amounts deposited with a senior lender are not sufficient (excluding business interruption proceeds for the period prior to accomplish restoration, Trustor deposits with the Beneficiary or senior lender, as required by that senior lender pursuant to the terms of the senior Debt Instrument, within five days of demand by Beneficiary, the additional amounts necessary to accomplish restoration. Proceeds disbursed for restoration will be released to Trustor in accordance with Beneficiary’s then current customary disbursement procedures. In the event any of the conditions set forth above are not satisfied or if the insurance proceeds shall not be applied to the restoration of the Security within thirty days after receipt of such proceeds by Beneficiary, Beneficiary may release such proceeds to Trustor without such release being deemed a payment of any indebtedness secured hereby, rather than apply such proceeds to the restoration of the Security. Such application or release shall not cure or waive any default or notice of default hereunder or invalidate any act done pursuant to such notice. If the Security is restored at a cost less than the available insurance proceeds, then such excess proceeds shall, if Trustor is not then in default hereunder, be paid over to Trustor. Beneficiary may commence, appear in, defend or prosecute any assigned claim or action, and may adjust, compromise, settle and collect all claims, proceeds and awards assigned to Beneficiary, but shall not be responsible for any failure to collect any claim, proceeds or award, regardless of the cause of the failureClosing).

Casualties. Trustor (a) If any damage to the Real Property shall give prompt occur prior to the Closing Date by reason of fire, windstorm, earthquake, hail, explosion, hurricane or other casualty, and if the cost of repairing such damage will equal or exceed Two Million Six Hundred Thousand Dollars ($2,600,000.00), Seller shall promptly notify Purchaser and Purchaser may then elect to (i) terminate this Agreement by giving written notice to Beneficiary upon Seller, whereupon Escrow Company shall immediately return the occurrence Deposit to Purchaser, the Parties shall each pay one-half of casualty the costs of the Escrow, and neither party to this Agreement shall thereafter have any further rights or liabilities under this Agreement, except for the Surviving Obligations, or (ii) receive an assignment of all of Seller’s claims in connection with the Security or therewith and any part thereof, whether or not covered by insurance. In the event of such casualty Trustor hereby absolutely and unconditionally assigns rights to Beneficiary all any insurance proceeds which it may be entitled (excluding business interruption proceeds for the period prior to receive and such proceeds shall be delivered to and held by Beneficiary to be applied to Beneficiary’s expenses in settling, prosecuting or defending any insurance claim, and then to the restoration of any portion of the Security that has been damaged or destroyed to the same condition, character and value as existed prior Closing) relating to such damage or destruction so long as and acquire the following conditions are satisfied: Property with appropriate adjustments to the Purchase Price equal to the deductible under the applicable insurance policy (i) Trustor to the extent such deductible is not in default hereunder (other than applied by Seller for repairs prior to Closing) and the reasonable costs and expenses incurred by Seller to negotiate or settle any default resulting from casualty claim with an insurer and to stabilize the Property following such casualty. (b) If the cost of repairing such damage will not exceed Two Million Six Hundred Thousand Dollars ($2,600,000.00), the transactions contemplated hereby shall close with appropriate adjustments to the Purchase Price equal to the deductible under the applicable insurance policy (ii) Beneficiary’s security to the extent such deductible is not materially impaired, (iii) all income (from the Security or otherwise) required to pay all debt service and operating expenses of the Security during such restoration and thereafter will be equal to or greater than the income which was required to pay such debt service and operating expenses applied by Seller for repairs prior to the casualty, (ivClosing) Trustor evidences and the costs and expenses incurred by Seller to negotiate or settle any casualty claim with an insurer and to stabilize the satisfaction Property following such casualty and Purchaser shall receive an assignment of Beneficiary that the insurance required all of Seller’s rights to be maintained hereunder will be available to the Trustor during restoration and thereafter, (v) Beneficiary shall have approved the plans and specifications for such restoration, which approval shall not be unreasonably withheld or delayed, and (vi) in the event that in Beneficiary’s sole judgment the any insurance proceeds and any amounts deposited with a senior lender are not sufficient (excluding business interruption proceeds for the period prior to accomplish restoration, Trustor deposits with the Beneficiary or senior lender, as required by that senior lender pursuant to the terms of the senior Debt Instrument, within five days of demand by Beneficiary, the additional amounts necessary to accomplish restoration. Proceeds disbursed for restoration will be released to Trustor in accordance with Beneficiary’s then current customary disbursement procedures. In the event any of the conditions set forth above are not satisfied or if the insurance proceeds shall not be applied to the restoration of the Security within thirty days after receipt of such proceeds by Beneficiary, Beneficiary may release such proceeds to Trustor without such release being deemed a payment of any indebtedness secured hereby, rather than apply such proceeds to the restoration of the Security. Such application or release shall not cure or waive any default or notice of default hereunder or invalidate any act done pursuant to such notice. If the Security is restored at a cost less than the available insurance proceeds, then such excess proceeds shall, if Trustor is not then in default hereunder, be paid over to Trustor. Beneficiary may commence, appear in, defend or prosecute any assigned claim or action, and may adjust, compromise, settle and collect all claims, proceeds and awards assigned to Beneficiary, but shall not be responsible for any failure to collect any claim, proceeds or award, regardless of the cause of the failureClosing).

Casualties. Trustor shall give prompt written notice to Beneficiary upon Insurance Proceeds. In the occurrence event of casualty to or in connection with the Security or any part thereofloss, whether or not covered by insurance, Trustor shall give immediate written notice to the Beneficiary and to the insurance carrier, if applicable, on an insured risk. In Trustor authorizes and empowers irrevocably, at Beneficiary's option and in Beneficiary's sole discretion as attorney-in-fact for Trustor, to make proof of loss, to adjust and compromise any claim under insurance policies, to appear in and prosecute any action arising from such insurance policies, to collect and receive insurance proceeds, and to deduct therefrom Beneficiary's expenses incurred in the event collection of such casualty proceeds, including reasonable attorneys' fees. Trustor hereby absolutely further authorizes Beneficiary, at Beneficiary's option and unconditionally assigns in Beneficiary's sole discretion, and regardless of whether there is any impairment of the security for this Deed of Trust: (a) to apply the balance of such proceeds, or any portion of them, upon any indebtedness secured by this Deed of Trust, whether or not then due, including but not limited to, principal, accrued interest and advances, and in such order or combination as Beneficiary all may determine; or (b) to hold the balance of such proceeds, or any portion of them, in a noninterest bearing liability account to be used for the cost of reconstruction, repair, or alteration of the Improvements on the property; or (c) to release the balance of such proceeds, or any portion of them, to the Trustor. If the insurance proceeds which it may be entitled to receive and such proceeds shall be delivered to and are held by Beneficiary to be applied used to Beneficiary’s expenses reimburse Trustor for the costs of restoration and repair of the Improvements, the Improvements shall be restored to the equivalent of its original condition, or such other condition as Beneficiary may approve in settling, prosecuting or defending any insurance claimwriting, and then to the restoration of any portion Beneficiary may, at Beneficiary's option, condition disbursement of the Security that has been damaged or destroyed to the same condition, character and value as existed prior to proceeds on Beneficiary's approval of such damage or destruction so long as the following conditions are satisfied: (i) Trustor is not in default hereunder (other than any default resulting from such casualty), (ii) Beneficiary’s security is not materially impaired, (iii) all income (from the Security or otherwise) required to pay all debt service and operating expenses of the Security during such restoration and thereafter will be equal to or greater than the income which was required to pay such debt service and operating expenses prior to the casualty, (iv) Trustor evidences to the satisfaction of Beneficiary that the insurance required to be maintained hereunder will be available to the Trustor during restoration and thereafter, (v) Beneficiary shall have approved the plans and specifications for such restorationprepared by an architect satisfactory to Beneficiary, which approval shall not be unreasonably withheld or delayedcontractor's cost estimates, architect's certificates, waivers of liens, sworn statements of mechanics and materialmen, and (vi) in such other evidence of costs, percentage completion of construction, application of payments, and satisfaction of liens, as Beneficiary may reasonably require. Prior to disbursement or application of the event that in proceeds, they may be utilized by Beneficiary’s sole judgment , who is entitled to all earnings on the proceeds, if any. If the insurance proceeds and any amounts deposited with a senior lender are not sufficient to accomplish restoration, Trustor deposits with the Beneficiary or senior lender, as required by that senior lender pursuant applied to the terms payment of the senior Debt Instrumentsums secured by this Deed of Trust, within five days any such application of demand by Beneficiaryproceeds to principal shall not extend or postpone the due date of the monthly installments referred to in this Deed of Trust or change the amount of such installment. In no event shall either Trustee or Beneficiary be obligated to see to, approve, or supervise the additional amounts necessary to accomplish restoration. Proceeds disbursed for restoration will be proper application of any hazard insurance proceeds released to Trustor in accordance with Beneficiary’s then current customary disbursement proceduresTrustor. In the event any The receipt, application, use, and release of the conditions set forth above are not satisfied or if the hazard insurance proceeds shall not be applied to the restoration of the Security within thirty days after receipt of such proceeds by Beneficiary, Beneficiary may release such proceeds to Trustor without such release being deemed a payment of any indebtedness secured hereby, rather than apply such proceeds to the restoration of the Security. Such application or release shall not cure or waive constitute a waiver of any default or pending notice of default hereunder or under this Deed of Trust, nor invalidate any act done pursuant to such notice. If No hazard insurance proceeds paid or released to Trustor or applied on the Security cost of repair, restoration, or alteration of the Improvements shall constitute a payment of the indebtedness secured by this Deed of Trust. It is restored at a cost less than further expressly understood and agreed between Trustor and Beneficiary that the available insurance proceedsright and option of Beneficiary, then such excess in the exercise of its sole discretion, to apply the proceeds shallor so much of them as may be necessary to pay the indebtedness secured by this Deed of Trust, if Trustor in whole or in part, is absolute, and is not then in default hereunder, be paid over to Trustor. Beneficiary may commence, appear in, defend contingent or prosecute any assigned claim conditional upon the adequacy or action, and may adjust, compromise, settle and collect all claims, proceeds and awards assigned to Beneficiary, but shall not be responsible for any failure to collect any claim, proceeds or award, regardless value of the cause remaining property to secure such unpaid indebtedness, or the nature, or extent of the failureloss or damage for which such insurance proceeds are paid.