Project Insurance. (a) The Borrower covenants that it will carry and maintain or cause to be carried and maintained, and pay, or cause to be paid, the premiums for at least the following insurance with respect to the Project and such other insurance as the Significant Bondholder and the Financial Monitor may reasonably request covering risks as are customarily insured against in connection with the operation of facilities comparable in size and scope of services to the Project at the time plus law and ordinance insurance in an amount of at least $250,000 (or property insurance covering increased cost due to law and ordinance): (i) Insurance against loss or damage from fire, lightning, windstorm, hurricane, hail, seismic event, explosion (but not including “Act of War”), terrorism, riot, riot attending a strike, civil commotion, aircraft, vehicles, smoke, vandalism and malicious mischief insurance in an amount not less than the full replacement cost of the Project; (ii) Insurance coverage of boilers, pressure vessels, auxiliary piping and selected machinery objects (pumps and compressors), in an amount not less than the replacement value of such property; (iii) Commercial general liability insurance, in the minimum amounts of $1,000,000 for each occurrence with a general aggregate limit of $2,000,000; (iv) Comprehensive automobile liability insurance in the minimum amount of $1,000,000 for each accident for bodily injury and property damage combined if the Borrower shall own or operate any automobiles or other vehicles; (v) Workers’ compensation coverage and any other similar type of insurance required by the laws of the State; (vi) Fidelity bonds in a minimum amount of $100,000 (or crime and employee dishonesty coverage in the amount of $100,000) on the Manager and all officers, employees, agents and contractors of the Manager who have access to or custody of revenues, receipts or income from the Project or any funds of the Borrower; (vii) Business income including extra expense insurance, covering loss of revenues by reason of the total or partial suspension of, or interruption in, the operation of the Project caused by the damage to or destruction of any part of the Project, with such exceptions as are customarily imposed by insurers covering a period of suspension or interruption and in such amount as will provide revenues equal to the Maximum Annual Debt Service for the Bonds together with the amount required to pay necessary Operating Expenses for the ensuing 12 months; (viii) Commercial umbrella liability insurance with minimum annual limits of $10,000,000; and (ix) Flood insurance, for the applicable portion of the Project if the Borrower shall not have provided a certification that each portion of the Project is not located in a 100-year flood plain. Such insurance shall at a minimum comply with Federal Emergency Management Agency coverage requirements and provide coverage in an amount equal to the lesser of the outstanding Loan amount or the maximum coverage available under the National Flood Insurance Program (“NFIP”). Although none of the Project may not now be included in a special flood hazard area or the governing municipality may not participate in the NFIP, Borrower acknowledges and agrees that it will provide such insurance within 45 days following notice from the Servicer that any portion of the Project has been included in a special flood hazard area or the governing municipality does then participate in the NFIP. The Servicer may obtain flood insurance and the Borrower acknowledges that such insurance will be much more expensive than that obtainable by the Borrower and may not provide certain protections for the Borrower, such as contents or liability coverages. (b) All insurance policies (other than flood insurance) issued or renewed after the initial issuance and delivery of the Bonds shall be taken out and maintained with companies that have a financial strength rating of “A-” or higher from A.M. Best. If the financial strength rating of any insurance provider falls below “A-,” the Borrower shall promptly obtain a replacement policy with a provider meeting the rating requirements herein contained. All policies of insurance required by the terms of this Agreement shall contain an endorsement or agreement by the insurer that any loss shall be payable in accordance with the terms of such policy notwithstanding any act or negligence of the Borrower, which might otherwise result in forfeiture of said insurance and the further agreement of the insurer waiving all rights of setoff, counterclaim or deductions against the Borrower. All such policies (other than workers’ compensation) shall name the Issuer, the Trustee and the Significant Bondholder (initially America First Multifamily Investors, L.P.) as additional insureds, as their respective interests may appear, and shall have attached thereto a lender’s loss payable endorsement for the benefit of the Trustee, which endorsement indicates that all insurance proceeds are payable directly to the Trustee. (c) The Borrower shall furnish the Trustee and the Servicer with certifications of all policies of required insurance. The Borrower shall file with the Trustee annually on or about the anniversary date of such policy or policies, a certificate of the Borrower to the effect that all insurance coverages required to be maintained hereunder are in effect and of full force and effect. The Trustee shall be entitled to rely upon said Borrower certificate as to the Borrower’s compliance with the insurance requirements without further inquiry. The Trustee makes no representation as to and shall have no responsibility for the sufficiency or adequacy of the insurance or the issuing insurer. All policies shall require at least 30 days’ prior written notification to the Borrower and the Trustee of modification, cancellation or termination in coverage and shall provide that no property claims shall be paid thereunder without at least 10 days’ prior written notice to the Trustee. Within 30 days prior to the expiration or cancellation of any policy, the Borrower will furnish or cause to be furnished to the Servicer satisfactory evidence of the continuance or replacement of such coverage under the requirements of this Agreement. The Borrower shall immediately give written notice to the Trustee and the Servicer and the Financial Monitor of any notice received by the Borrower of any expiration, cancellation or modification of, or material reduction of coverage under, any such policy. (d) The Borrower may take out separate insurance concurrent in form or contributing in the event of loss with that required in this Section; provided that the Borrower shall immediately notify the Trustee whenever any such separate insurance is taken out. No such separate or additional policies of insurance shall reduce the insurance coverage required hereunder to be maintained. (e) In the event the Borrower fails to take out or maintain the full insurance coverage required under this Section, the Trustee, after first notifying the Borrower, may (but shall not be obligated to) take out the required policies of insurance and pay the premiums on the same and the costs thereof so advanced shall be paid promptly by the Borrower from any available moneys upon the Trustee’s presentation to the Borrower of statements or invoices evidencing same, together with interest thereon to the date of payment as provided herein. (f) The risk of loss or of decrease in the enjoyment and beneficial use of the Project in consequence of the damage or destruction thereof by fire, the elements, casualties, thefts, terrorism, riots, civil strife, war, nuclear explosion, or otherwise, or in consequence of foreclosures, attachments, levies or executions, is expressly assumed by the Borrower, and the Borrower agrees that the Issuer and the Trustee shall in no event be answerable, accountable or liable therefor, nor shall any of the foregoing events entitle the Borrower to any abatement or diminution of its obligations hereunder.
Appears in 12 contracts
Samples: Loan Agreement, Loan Agreement, Loan Agreement
Project Insurance.
(a) The Borrower covenants that it will carry and maintain or cause to be carried and maintained, and pay, or cause to be paid, the premiums for at least the following insurance with respect to the Project and such other insurance as the Significant Bondholder and the Financial Monitor may reasonably request covering risks as are customarily insured against in connection with the operation of facilities comparable in size and scope of services to the Project at the time plus law and ordinance insurance in an amount of at least $250,000 (or property insurance covering increased cost due to law and ordinance):
(i) Insurance against loss or damage from fire, lightning, windstorm, hurricane, hail, seismic event, explosion (but not including “Act of War”), terrorism, riot, riot attending a strike, civil commotion, aircraft, vehicles, smoke, vandalism and malicious mischief insurance in an amount not less than the full replacement cost of the Project;
(ii) Insurance coverage of boilers, pressure vessels, auxiliary piping and selected machinery objects (pumps and compressors), in an amount not less than the replacement value of such property;
(iii) Commercial general liability insurance, in the minimum amounts of $1,000,000 for each occurrence with a general aggregate limit of $2,000,000;
(iv) Comprehensive automobile liability insurance in the minimum amount of $1,000,000 for each accident for bodily injury and property damage combined if the Borrower shall own or operate any automobiles or other vehicles;
(v) Workers’ compensation coverage and any other similar type of insurance required by the laws of the State;
(vi) Fidelity bonds in a minimum amount of $100,000 (or crime and employee dishonesty coverage in the amount of $100,000) on the Project Manager and all officers, employees, agents officers and contractors employees of the Borrower and the Project Manager who have access to or custody of revenues, receipts or income from the Project or any funds of the Borrower;
(vii) Business income including extra expense insurance, covering loss of revenues by reason of the total or partial suspension of, or interruption in, the operation of the Project caused by the damage to or destruction of any part of the Project, with such exceptions as are customarily imposed by insurers covering a period of suspension or interruption and in such amount as will provide revenues equal to the Maximum Annual Debt Service for the Bonds together with the amount required to pay necessary Operating Expenses for the ensuing 12 months;
(viii) Commercial umbrella liability insurance with minimum annual limits of $10,000,000; and
(ix) Flood insurance, for the applicable portion of the Project if the Borrower shall not have provided a certification that each portion of the Project is not located in a 100-year flood plain. Such insurance shall at a minimum comply with Federal Emergency Management Agency coverage requirements and provide coverage in an amount equal to the lesser of the outstanding Loan amount or the maximum coverage available under the National Flood Insurance Program (“NFIP”). Although none of the Project may not now be included in a special flood hazard area or the governing municipality may not participate in the NFIP, Borrower acknowledges and agrees that it will provide such insurance within 45 days following notice from the Servicer that any portion of the Project has been included in a special flood hazard area or the governing municipality does then participate in the NFIP. The Servicer may obtain flood insurance and the Borrower acknowledges that such insurance will be much more expensive than that obtainable by the Borrower and may not provide certain protections for the Borrower, such as contents or liability coverages.
(b) All insurance policies (other than flood insurance) issued or renewed after the initial issuance and delivery of the Bonds shall be taken out and maintained with companies that have a financial strength rating of “A-” or higher from A.M. Best. If the financial strength rating of any insurance provider falls below “A-,” the Borrower shall promptly obtain a replacement policy with a provider meeting the rating requirements herein contained. All policies of insurance required by the terms of this Agreement shall contain an endorsement or agreement by the insurer that any loss shall be payable in accordance with the terms of such policy notwithstanding any act or negligence of the Borrower, which might otherwise result in forfeiture of said insurance and the further agreement of the insurer waiving all rights of setoff, counterclaim or deductions against the Borrower. All such policies (other than workers’ compensation) shall name the Issuer, the Trustee and the Significant Bondholder (initially America First Multifamily Investors, L.P.) as additional insureds, as their respective interests may appear, and shall have attached thereto a lender’s loss payable endorsement for the benefit of the Trustee, which endorsement indicates that all insurance proceeds are payable directly to the Trustee.
(c) The Borrower shall furnish the Trustee and the Servicer with certifications of all policies of required insurance. The Borrower shall file with the Trustee annually on or about the anniversary date of such policy or policies, a certificate of the Borrower to the effect that all insurance coverages required to be maintained hereunder are in effect and of full force and effect. The Trustee shall be entitled to rely upon said Borrower certificate as to the Borrower’s compliance with the insurance requirements without further inquiry. The Trustee makes no representation as to and shall have no responsibility for the sufficiency or adequacy of the insurance or the issuing insurer. All policies shall require at least 30 days’ prior written notification to the Borrower and the Trustee of modification, cancellation or termination in coverage and shall provide that no property claims shall be paid thereunder without at least 10 days’ prior written notice to the Trustee. Within 30 days prior to the expiration or cancellation of any policy, the Borrower will furnish or cause to be furnished to the Servicer satisfactory evidence of the continuance or replacement of such coverage under the requirements of this Agreement. The Borrower shall immediately give written notice to the Trustee and the Servicer and the Financial Monitor of any notice received by the Borrower of any expiration, cancellation or modification of, or material reduction of coverage under, any such policy.
(d) The Borrower may take out separate insurance concurrent in form or contributing in the event of loss with that required in this Section; provided that the Borrower shall immediately notify the Trustee whenever any such separate insurance is taken out. No such separate or additional policies of insurance shall reduce the insurance coverage required hereunder to be maintained.
(e) In the event the Borrower fails to take out or maintain the full insurance coverage required under this Section, the Trustee, after first notifying the Borrower, may (but shall not be obligated to) take out the required policies of insurance and pay the premiums on the same and the costs thereof so advanced shall be paid promptly by the Borrower from any available moneys upon the Trustee’s presentation to the Borrower of statements or invoices evidencing same, together with interest thereon to the date of payment as provided herein.
(f) The risk of loss or of decrease in the enjoyment and beneficial use of the Project in consequence of the damage or destruction thereof by fire, the elements, casualties, thefts, terrorism, riots, civil strife, war, nuclear explosion, or otherwise, or in consequence of foreclosures, attachments, levies or executions, is expressly assumed by the Borrower, and the Borrower agrees that the Issuer and the Trustee shall in no event be answerable, accountable or liable therefor, nor shall any of the foregoing events entitle the Borrower to any abatement or diminution of its obligations hereunder.
(g) The Borrower agrees to furnish to the Trustee or Servicer, on January 1 of each year commencing 1, 20 , reports on each existing insurance policy showing such information as the Trustee, the Financial Monitor, or the Servicer may reasonably request, including, without limitation, the following: (i) the name of the insurer, (ii) the risks insured, (iii) the amount of the policy, (iv) the properties insured,
Appears in 1 contract
Samples: Loan Agreement
Project Insurance. (a) The Borrower covenants that it will carry and maintain or cause to be carried and maintained, and pay, or cause to be paid, the premiums for at least the following insurance with respect to the Project and such other insurance as the Significant Bondholder and the Financial Monitor may reasonably request covering risks as are customarily insured against in connection with the operation of facilities comparable in size and scope of services to the Project at the time plus law and ordinance insurance in an amount of at least $250,000 (or property insurance covering increased cost due to law and ordinance):
(i) Insurance against loss or damage from fire, lightning, windstorm, hurricane, hail, seismic event, explosion (but not including “Act of War”), terrorism, riot, riot attending a strike, civil commotion, aircraft, vehicles, smoke, vandalism and malicious mischief insurance in an amount not less than the full replacement cost of the Project;
(ii) Insurance coverage of boilers, pressure vessels, auxiliary piping and selected machinery objects (pumps and compressors), in an amount not less than the replacement value of such property;
(iii) Commercial general liability insurance, in the minimum amounts of $1,000,000 for each occurrence with a general aggregate limit of $2,000,000;
(iv) Comprehensive automobile liability insurance in the minimum amount of $1,000,000 for each accident for bodily injury and property damage combined if the Borrower shall own or operate any automobiles or other vehicles;
(v) Workers’ compensation coverage and any other similar type of insurance required by the laws of the State;
(vi) Fidelity bonds in a minimum amount of $100,000 (or crime and employee dishonesty coverage in the amount of $100,000) on the Project Manager and all officers, employees, agents officers and contractors employees of the Borrower and the Project Manager who have access to or custody of revenues, receipts or income from the Project or any funds of the Borrower;
(vii) Business income including extra expense insurance, covering loss of revenues by reason of the total or partial suspension of, or interruption in, the operation of the Project caused by the damage to or destruction of any part of the Project, with such exceptions as are customarily imposed by insurers covering a period of suspension or interruption and in such amount as will provide revenues equal to the Maximum Annual Debt Service for the Bonds together with the amount required to pay necessary Operating Expenses for the ensuing 12 months;
(viii) Commercial umbrella liability insurance with minimum annual limits of $10,000,000; and
(ix) Flood insurance, for the applicable portion of the Project if the Borrower shall not have provided a certification that each portion of the Project is not located in a 100-year flood plain. Such insurance shall at a minimum comply with Federal Emergency Management Agency coverage requirements and provide coverage in an amount equal to the lesser of the outstanding Loan amount or the maximum coverage available under the National Flood Insurance Program (“NFIP”). Although none of the Project may not now be included in a special flood hazard area or the governing municipality may not participate in the NFIP, Borrower acknowledges and agrees that it will provide such insurance within 45 days following notice from the Servicer that any portion of the Project has been included in a special flood hazard area or the governing municipality does then participate in the NFIP. The Servicer may obtain flood insurance and the Borrower acknowledges that such insurance will be much more expensive than that obtainable by the Borrower and may not provide certain protections for the Borrower, such as contents or liability coverages.
(b) All insurance policies (other than flood insurance) issued or renewed after the initial issuance and delivery of the Bonds shall be taken out and maintained with companies that have a financial strength rating of “A-” or higher from A.M. Best. If the financial strength rating of any insurance provider falls below “A-,” the Borrower shall promptly obtain a replacement policy with a provider meeting the rating requirements herein contained. All policies of insurance required by the terms of this Agreement shall contain an endorsement or agreement by the insurer that any loss shall be payable in accordance with the terms of such policy notwithstanding any act or negligence of the Borrower, which might otherwise result in forfeiture of said insurance and the further agreement of the insurer waiving all rights of setoff, counterclaim or deductions against the Borrower. All such policies (other than workers’ compensation) shall name the Issuer, the Trustee and the Significant Bondholder (initially America First Multifamily Investors, L.P.) as additional insureds, as their respective interests may appear, and shall have attached thereto a lender’s loss payable endorsement for the benefit of the Trustee, which endorsement indicates that all insurance proceeds are payable directly to the Trustee.
(c) The Borrower shall furnish the Trustee and the Servicer with certifications of all policies of required insurance. The Borrower shall file with the Trustee annually on or about the anniversary date of such policy or policies, a certificate of the Borrower to the effect that all insurance coverages required to be maintained hereunder are in effect and of full force and effect. The Trustee shall be entitled to rely upon said Borrower certificate as to the Borrower’s compliance with the insurance requirements without further inquiry. The Trustee makes no representation as to and shall have no responsibility for the sufficiency or adequacy of the insurance or the issuing insurer. All policies shall require at least 30 days’ prior written notification to the Borrower and the Trustee of modification, cancellation or termination in coverage and shall provide that no property claims shall be paid thereunder without at least 10 days’ prior written notice to the Trustee. Within 30 days prior to the expiration or cancellation of any policy, the Borrower will furnish or cause to be furnished to the Servicer satisfactory evidence of the continuance or replacement of such coverage under the requirements of this Agreement. The Borrower shall immediately give written notice to the Trustee and the Servicer and the Financial Monitor of any notice received by the Borrower of any expiration, cancellation or modification of, or material reduction of coverage under, any such policy.
(d) The Borrower may take out separate insurance concurrent in form or contributing in the event of loss with that required in this Section; provided that the Borrower shall immediately notify the Trustee whenever any such separate insurance is taken out. No such separate or additional policies of insurance shall reduce the insurance coverage required hereunder to be maintained.
(e) In the event the Borrower fails to take out or maintain the full insurance coverage required under this Section, the Trustee, after first notifying the Borrower, may (but shall not be obligated to) take out the required policies of insurance and pay the premiums on the same and the costs thereof so advanced shall be paid promptly by the Borrower from any available moneys upon the Trustee’s presentation to the Borrower of statements or invoices evidencing same, together with interest thereon to the date of payment as provided herein.
(f) The risk of loss or of decrease in the enjoyment and beneficial use of the Project in consequence of the damage or destruction thereof by fire, the elements, casualties, thefts, terrorism, riots, civil strife, war, nuclear explosion, or otherwise, or in consequence of foreclosures, attachments, levies or executions, is expressly assumed by the Borrower, and the Borrower agrees that the Issuer and the Trustee shall in no event be answerable, accountable or liable therefor, nor shall any of the foregoing events entitle the Borrower to any abatement or diminution of its obligations hereunder.
(g) The Borrower agrees to furnish to the Trustee or Servicer, on January 1 of each year commencing 1, 20 , reports on each existing insurance policy showing such information as the Trustee, the Financial Monitor, or the Servicer may reasonably request, including, without limitation, the following: (i) the name of the insurer, (ii) the risks insured, (iii) the amount of the policy, (iv) the properties insured,
Appears in 1 contract
Samples: Loan Agreement
Project Insurance.
(a) The Borrower covenants that it will carry and maintain or cause to be carried and maintained, and pay, or cause to be paid, the premiums for at least the following insurance with respect to the Project and such other insurance as the Significant Bondholder and the Financial Monitor may reasonably request covering risks as are customarily insured against in connection with the operation of facilities comparable in size and scope of services to the Project at the time plus law and ordinance insurance in an amount of at least $250,000 (or property insurance covering increased cost due to law and ordinance):
(i) Insurance against loss or damage from fire, lightning, windstorm, hurricane, hail, seismic event, explosion (but not including “Act of War”), terrorism, riot, riot attending a strike, civil commotion, aircraft, vehicles, smoke, vandalism and malicious mischief insurance in an amount not less than the full replacement cost of the Project;
(ii) Insurance coverage of boilers, pressure vessels, auxiliary piping and selected machinery objects (pumps and compressors), in an amount not less than the replacement value of such property;
(iii) Commercial general liability insurance, in the minimum amounts of $1,000,000 for each occurrence with a general aggregate limit of $2,000,000;
(iv) Comprehensive automobile liability insurance in the minimum amount of $1,000,000 for each accident for bodily injury and property damage combined if the Borrower shall own or operate any automobiles or other vehicles;
(v) Workers’ compensation coverage and any other similar type of insurance required by the laws of the State;
(vi) Fidelity bonds in a minimum amount of $100,000 (or crime and employee dishonesty coverage in the amount of $100,000) on the Manager and all officers, employees, agents and contractors of the Manager who have access to or custody of revenues, receipts or income from the Project or any funds of the Borrower;
(vii) Business income including extra expense insurance, covering loss of revenues by reason of the total or partial suspension of, or interruption in, the operation of the Project caused by the damage to or destruction of any part of the Project, with such exceptions as are customarily imposed by insurers covering a period of suspension or interruption and in such amount as will provide revenues equal to the Maximum Annual Debt Service for the Bonds together with the amount required to pay necessary Operating Expenses for the ensuing 12 months;
(viii) Commercial umbrella liability insurance with minimum annual limits of $10,000,000; and
(ix) Flood insurance, for the applicable portion of the Project if the Borrower shall not have provided a certification that each portion of the Project is not located in a 100-year flood plain. Such insurance shall at a minimum comply with Federal Emergency Management Agency coverage requirements and provide coverage in an amount equal to the lesser of the outstanding Loan amount or the maximum coverage available under the National Flood Insurance Program (“NFIP”). Although none of the Project may not now be included in a special flood hazard area or the governing municipality may not participate in the NFIP, Borrower acknowledges and agrees that it will provide such insurance within 45 days following notice from the Servicer that any portion of the Project has been included in a special flood hazard area or the governing municipality does then participate in the NFIP. The Servicer may obtain flood insurance and the Borrower acknowledges that such insurance will be much more expensive than that obtainable by the Borrower and may not provide certain protections for the Borrower, such as contents or liability coverages.
(b) All insurance policies (other than flood insurance) issued or renewed after the initial issuance and delivery of the Bonds shall be taken out and maintained with companies that have a financial strength rating of “A-” or higher from A.M. Best. If the financial strength rating of any insurance provider falls below “A-,” the Borrower shall promptly obtain a replacement policy with a provider meeting the rating requirements herein contained. All policies of insurance required by the terms of this Agreement shall contain an endorsement or agreement by the insurer that any loss shall be payable in accordance with the terms of such policy notwithstanding any act or negligence of the Borrower, which might otherwise result in forfeiture of said insurance and the further agreement of the insurer waiving all rights of setoff, counterclaim or deductions against the Borrower. All such policies (other than workers’ compensation) shall name the Issuer, the Trustee and the Significant Bondholder (initially America First Multifamily Investors, L.P.) as additional insureds, as their respective interests may appear, and shall have attached thereto a lender’s loss payable endorsement for the benefit of the Trustee, which endorsement indicates that all insurance proceeds are payable directly to the Trustee.
(c) The Borrower shall furnish the Trustee and the Servicer with certifications of all policies of required insurance. The Borrower shall file with the Trustee annually on or about the anniversary date of such policy or policies, a certificate of the Borrower to the effect that all insurance coverages required to be maintained hereunder are in effect and of full force and effect. The Trustee shall be entitled to rely upon said Borrower certificate as to the Borrower’s compliance with the insurance requirements without further inquiry. The Trustee makes no representation as to and shall have no responsibility for the sufficiency or adequacy of the insurance or the issuing insurer. All policies shall require at least 30 days’ prior written notification to the Borrower and the Trustee of modification, cancellation or termination in coverage and shall provide that no property claims shall be paid thereunder without at least 10 days’ prior written notice to the Trustee. Within 30 days prior to the expiration or cancellation of any policy, the Borrower will furnish or cause to be furnished to the Servicer satisfactory evidence of the continuance or replacement of such coverage under the requirements of this Agreement. The Borrower shall immediately give written notice to the Trustee and the Servicer and the Financial Monitor of any notice received by the Borrower of any expiration, cancellation or modification of, or material reduction of coverage under, any such policy.
(d) The Borrower may take out separate insurance concurrent in form or contributing in the event of loss with that required in this Section; provided that the Borrower shall immediately notify the Trustee whenever any such separate insurance is taken out. No such separate or additional policies of insurance shall reduce the insurance coverage required hereunder to be maintained.
(e) In the event the Borrower fails to take out or maintain the full insurance coverage required under this Section, the Trustee, after first notifying the Borrower, may (but shall not be obligated to) take out the required policies of insurance and pay the premiums on the same and the costs thereof so advanced shall be paid promptly by the Borrower from any available moneys upon the Trustee’s presentation to the Borrower of statements or invoices evidencing same, together with interest thereon to the date of payment as provided herein.
(f) The risk of loss or of decrease in the enjoyment and beneficial use of the Project in consequence of the damage or destruction thereof by fire, the elements, casualties, thefts, terrorism, riots, civil strife, war, nuclear explosion, or otherwise, or in consequence of foreclosures, attachments, levies or executions, is expressly assumed by the Borrower, and the Borrower agrees that the Issuer and the Trustee shall in no event be answerable, accountable or liable therefor, nor shall any of the foregoing events entitle the Borrower to any abatement or diminution of its obligations hereunder.
Appears in 1 contract
Samples: Loan Agreement
Project Insurance. (a) The Borrower covenants that it will carry and maintain or cause to be carried and maintained, and pay, or cause to be paid, the premiums for at least the following insurance with respect to the Project and such other insurance as the Significant Bondholder and the Financial Monitor may reasonably request covering risks as are customarily insured against in connection with the operation of facilities comparable in size and scope of services to the Project at the time plus law and ordinance insurance in an amount of at least $250,000 (or property insurance covering increased cost due to law and ordinance):
(i) Insurance against loss or damage from fire, lightning, windstorm, hurricane, hail, seismic event, explosion (but not including “Act of War”), terrorism, riot, riot attending a strike, civil commotion, aircraft, vehicles, smoke, vandalism and malicious mischief insurance in an amount not less than the full replacement cost of the Project;
(ii) Insurance coverage of boilers, pressure vessels, auxiliary piping and selected machinery objects (pumps and compressors), in an amount not less than the replacement value of such property;
(iii) Commercial general liability insurance, in the minimum amounts of $1,000,000 for each occurrence with a general aggregate limit of $2,000,000;
(iv) Comprehensive automobile liability insurance in the minimum amount of $1,000,000 for each accident for bodily injury and property damage combined if the Borrower shall own or operate any automobiles or other vehicles;
(v) Workers’ compensation coverage and any other similar type of insurance required by the laws of the State;
(vi) Fidelity bonds in a minimum amount of $100,000 (or crime and employee dishonesty coverage in the amount of $100,000) on the Project Manager and all officers, employees, agents officers and contractors employees of the Borrower and the Project Manager who have access to or custody of revenues, receipts or income from the Project or any funds of the Borrower;
(vii) Business income including extra expense insurance, covering loss of revenues by reason of the total or partial suspension of, or interruption in, the operation of the Project caused by the damage to or destruction of any part of the Project, with such exceptions as are customarily imposed by insurers covering a period of suspension or interruption and in such amount as will provide revenues equal to the Maximum Annual Debt Service for the Bonds together with the amount required to pay necessary Operating Expenses for the ensuing 12 months;
(viii) Commercial umbrella liability insurance with minimum annual limits of $10,000,000; and
(ix) Flood insurance, for the applicable portion of the Project if the Borrower shall not have provided a certification that each portion of the Project is not located in a 100-year flood plain. Such insurance shall at a minimum comply with Federal Emergency Management Agency coverage requirements and provide coverage in an amount equal to the lesser of the outstanding Loan amount or the maximum coverage available under the National Flood Insurance Program (“NFIP”). Although none of the Project may not now be included in a special flood hazard area or the governing municipality may not participate in the NFIP, Borrower acknowledges and agrees that it will provide such insurance within 45 days following notice from the Servicer that any portion of the Project has been included in a special flood hazard area or the governing municipality does then participate in the NFIP. The Servicer may obtain flood insurance and the Borrower acknowledges that such insurance will be much more expensive than that obtainable by the Borrower and may not provide certain protections for the Borrower, such as contents or liability coverages.
(b) All insurance policies (other than flood insurance) issued or renewed after the initial issuance and delivery of the Bonds shall be taken out and maintained with companies that have a financial strength rating of “A-” or higher from A.M. Best. If the financial strength rating of any insurance provider falls below “A-,” the Borrower shall promptly obtain a replacement policy with a provider meeting the rating requirements herein contained. All policies of insurance required by the terms of this Agreement shall contain an endorsement or agreement by the insurer that any loss shall be payable in accordance with the terms of such policy notwithstanding any act or negligence of the Borrower, which might otherwise result in forfeiture of said insurance and the further agreement of the insurer waiving all rights of setoff, counterclaim or deductions against the Borrower. All such policies (other than workers’ compensation) shall name the Issuer, the Trustee and the Significant Bondholder (initially America First Multifamily Investors, L.P.) as additional insureds, as their respective interests may appear, and shall have attached thereto a lender’s loss payable endorsement for the benefit of the Trustee, which endorsement indicates that all insurance proceeds are payable directly to the Trustee.
(c) The Borrower shall furnish the Trustee and the Servicer with certifications of all policies of required insurance. The Borrower shall file with the Trustee annually on or about the anniversary date of such policy or policies, a certificate of the Borrower to the effect that all insurance coverages required to be maintained hereunder are in effect and of full force and effect. The Trustee shall be entitled to rely upon said Borrower certificate as to the Borrower’s compliance with the insurance requirements without further inquiry. The Trustee makes no representation as to and shall have no responsibility for the sufficiency or adequacy of the insurance or the issuing insurer. All policies shall require at least 30 days’ prior written notification to the Borrower and the Trustee of modification, cancellation or termination in coverage and shall provide that no property claims shall be paid thereunder without at least 10 days’ prior written notice to the Trustee. Within 30 days prior to the expiration or cancellation of any policy, the Borrower will furnish or cause to be furnished to the Servicer satisfactory evidence of the continuance or replacement of such coverage under the requirements of this Agreement. The Borrower shall immediately give written notice to the Trustee and the Servicer and the Financial Monitor of any notice received by the Borrower of any expiration, cancellation or modification of, or material reduction of coverage under, any such policy.
(d) The Borrower may take out separate insurance concurrent in form or contributing in the event of loss with that required in this Section; provided that the Borrower shall immediately notify the Trustee whenever any such separate insurance is taken out. No such separate or additional policies of insurance shall reduce the insurance coverage required hereunder to be maintained.
(e) In the event the Borrower fails to take out or maintain the full insurance coverage required under this Section, the Trustee, after first notifying the Borrower, may (but shall not be obligated to) take out the required policies of insurance and pay the premiums on the same and the costs thereof so advanced shall be paid promptly by the Borrower from any available moneys upon the Trustee’s presentation to the Borrower of statements or invoices evidencing same, together with interest thereon to the date of payment as provided herein.
(f) The risk of loss or of decrease in the enjoyment and beneficial use of the Project in consequence of the damage or destruction thereof by fire, the elements, casualties, thefts, terrorism, riots, civil strife, war, nuclear explosion, or otherwise, or in consequence of foreclosures, attachments, levies or executions, is expressly assumed by the Borrower, and the Borrower agrees that the Issuer and the Trustee shall in no event be answerable, accountable or liable therefor, nor shall any of the foregoing events entitle the Borrower to any abatement or diminution of its obligations hereunder.
(g) The Borrower agrees to furnish to the Trustee or Servicer, on January 1 of each year commencing January 1, 2016, reports on each existing insurance policy showing such information as the Trustee, the Financial Monitor, or the Servicer may reasonably request, including, without limitation, the following: (i) the name of the insurer, (ii) the risks insured, (iii) the amount of the policy, (iv) the properties insured,
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Samples: Loan Agreement
