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<br />appropriate legal proceedings promptly initiated and conducted in good faith and with due
<br />diligence, provided that (i) Beneficiary is reasonably satisfied that neither the Property nor any
<br />part thereof or interest therein will be in danger of being sold, forfeited, or lost as a result of such
<br />contest, and (ii) Trustor shall have posted a bond or furnished other security as may reasonably
<br />be required from time to time by Beneficiary; and provided further that Trustor shall timely
<br />make any payment necessary to prevent a lien foreclosure, sale, forfeiture or loss ofthe Property.
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<br />Trustor shall immediately discharge or cause to be discharged any lien on the Property
<br />(other than encumbrances approved by Beneficiary as of the date hereof in writing). Trustor
<br />shall pay when due each obligation secured by or reducible to a lien, charge or encumbrance
<br />which now does or later may encumber or appear to encumber all or part of the Property or any
<br />interest in it, whether or not such lien, charge or encumbrance is or would be senior or
<br />subordinate to this Deed of Trust. Trustor shall not be required to pay any tax, levy, charge or
<br />assessment so long as its validity is being actively contested in good faith and by appropriate
<br />actions and/or proceedings.
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<br />7.7 Subrogation. Beneficiary shall be subrogated to the liens of all encumbrances,
<br />whether released of record or not, which are discharged in whole or in part by Beneficiary in
<br />accordance with this Deed of Trust.
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<br />7.8 Hazard. Liability and Workers' Compensation Insurance. At all times during the
<br />term hereof, Trustor shall at Trustor's expense, maintain insurance policies in accordance with
<br />the requirements set forth in the City Documents. Trustor shall file with Beneficiary prior to the
<br />commencement of the term hereof, certificates (or such other proof as Beneficiary may
<br />reasonably require, (including without limitation copies of the required insurance policies)
<br />evidencing each of the insurance policies and endorsements thereto as required pursuant to the
<br />City Documents, and such certificates (or policies) shall provide that at least thirty (30) days'
<br />prior written notice shall be provided to Beneficiary prior to the expiration, cancellation or
<br />change in coverage under each such policy. If any insurance policy required pursuant to the City
<br />Documents is canceled or the coverage provided thereunder is reduced, Trustor shall, within ten
<br />(10) days after receipt of written notice of such cancellation or reduction in coverage, but in no
<br />event later than the effective date of cancellation or reduction, file with Beneficiary a certificate
<br />showing that the required insurance has been reinstated or provided through another insurance
<br />company or companies. Upon failure to so file such certificate, Beneficiary may, without further
<br />notice and at its option, procure such insurance coverage at Trustor's expense, and Trustor shall
<br />promptly reimburse Beneficiary for such expense upon receipt of billing from Beneficiary.
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<br />7.9 Hazardous Materials. Trustor shall not cause or permit any Hazardous Material
<br />(as defined in Section 4.13.1 of the City Loan Agreement) to be brought upon, kept, stored or
<br />used in, on, under, or about the Land by Trustor, its agents, employees, contractors or invitees
<br />except for incidental supplies ordinarily used in the construction and operation ofthe Project in
<br />compliance with all applicable laws, and shall not cause any release of Hazardous Materials into,
<br />onto, under or through the Land. If any Hazardous Material is discharged, released, dumped, or
<br />spilled in, on, under, or about the Land and results in any contamination of the Land or adjacent
<br />property, or otherwise results in the release or discharge of Hazardous Materials in, on, under or
<br />from the Land, Trustor shall promptly take all actions at its sole expense as are necessary to
<br />comply with all Environmental Laws (as defined below).
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