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the expiration dates of each such policy, .1QH-San Marcos will deliver to City acceptahle
<br />evidence of insurance, such as a renewal policy or policies marked "premium paid" or
<br />other evidence satisfactory to City reflecting that all required insurance is current and in
<br />force. JQH-San Marcos will immediately give Notice to City of any cancellation ot; or
<br />change in, any insurance policy. City shall not, because of accepting, rejecting,
<br />approving or obtaining insurance, incur any liability for (A) the existence, nonexistence,
<br />form ur legal sufficiency thereof, (B) the solvency of any insurer, or (C) the payment of
<br />losses. JQH-San Marcos may satisfy any insurance requirement hereunder by providing
<br />one or more =`blanket" insurance policies, subject to City's approval in each instance as to
<br />limits, coverages, forms, deductibles, inception and expiration dates, and cancellation
<br />provisions.
<br />5.2 Existence ,and Compliance. Maurtain its existence, good standing and
<br />qualification to do business, where required, and comply with all laws, regulations and
<br />governmental requirements including, without limitation, environmental laws applicable
<br />to it, the Project, and any of its property, business operations, and transactions.
<br />5.3 Costs~E~enses and Attorneys' Fees. Pay to City immediately upon
<br />demand the fiill amount of all costs and expenses, including reasonable attorneys' fees
<br />incurred by Cily in connection with all cults and reasonable attorneys' fees incurred by
<br />City for which JQH-San Marcos is obligated to reimburse City in accordance with the
<br />terms of the Loan Documents.
<br />5.4 Taxes and Other Obl~ions. Pay all of its taxes, assessments and other
<br />obligations, with respect to the Property including, but not limited to taxes, costs or other
<br />expenses arising out of this tr~rnsaction, as the same become due artd payable, except to
<br />the extent the same are being contested in good faith by appropriate proceedings in a
<br />diligent manner.
<br />5,5 Maintenance. Maintain all improvements hereafter constructed on the
<br />Property in good condition and repair and make all necessary replacements thereof, and
<br />preserve and maintain all licenses, trademarks, privileges, permits, franchises, certificates
<br />and the like necessary fur the operation of the Project.
<br />5.6 Environmental Matters. Immediately advise City in writing of (i) any
<br />and all enforcement, cleanup, remedial, removal, or other governmental or regulatory
<br />actions instituted, completed or threatened pursuant to any applicable federal, state, or
<br />local laws, ordinances or regulations relating to any Hazardous Materials affecting the
<br />Properly relating to damages, contribution, cost recovery, compensation, loss, or injury
<br />resulting tTOm aJiy Hazardous Materials. JQH-San Marcos shall immediately notify City
<br />of any remedial action taken by or on behalf of JQH-San Marcos with respect to the
<br />Property. JQH-San Marcos will not use or permit any other party to use any Hazardous
<br />:Materials at the Property except such materials as are incidental to JQH-San Marcos'
<br />normal course of business, maintenance and repairs and which are handled in compliance
<br />with all applicable environmental laws. JQH-San Marcus agrees to permit City, its
<br />agents, contractors and employees to enter and inspect the Property at any reasonable
<br />times upon three (3) days prior notice for the purposes of conducting an environmental
<br />investigation and audit (including taking physical samples) to insure that JQFI-San
<br />Marcos is complying with this covenant and JQH-San 1~'Iarcos shall reimburse City on
<br />demand for the costs of any such env ironmenlal investigation and audit. JQH-San
<br />Marcos shall provide City, its agents, contractors, employees and representatives with
<br />985897.7
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