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<br />4.8 Taxes. All taxes and assessments due and payable with respect to the Property have been
<br />paid or are being contested in good faith by appropriate proceedings. JQH has timely filed all tax returns
<br />which it is required to file, taking into account valid extensions to file tax returns obtained by JQH.
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<br />4.9 Environmental. To JQH's actual knowledge, the Property is not, and will not, in any material
<br />respect, be in violation of any federal laws, rules or ordinances for environmental protection, regulations
<br />of the Environmental Protection Agency, any applicable local or state law, rule, regulation or rule of
<br />common law or any judicial interpretation thereof relating primarily to the environment or Hazardous
<br />Materials.
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<br />4.10 Use of Proceeds. The proceeds of the Grant and Loan will be used by JQH for the sole
<br />purpose of acquiring the Property.
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<br />ARTICLE V
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<br />AFFIRMATIVE COVENANTS
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<br />Until full payment and performance of all obligations of JQH under the Loan Documents, JQH will,
<br />unless City consents otherwise in writing (and without limiting any requirement of any other Loan
<br />Document):
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<br />5.1 Insurance. Maintain, at JQH's sole cost and expense, commercial general liability insurance
<br />on an "occurrence" basis against claims for "personal injury" liability and liability for death, bodily injury
<br />and damage to property, products and completed operations, in limits satisfactory to City, from time to
<br />time, with respect to anyone occurrence and the aggregate of all occurrences during any given mmual
<br />policy period, it being agreed that City may charge the required limits throughout the tenn of this
<br />Agreement. Such insurance shall name City as an additional insured.
<br />
<br />In addition to the foregoing, JQH shall cause any contractor performing work on the Property to provide
<br />and maintain comprehensive (commercial) general liability insurance and workers' compensation
<br />insurance for all employees of the general contractor meeting the requirements of this Section 5.1.
<br />
<br />Each policy of insurance (i) shall be issued by one or more insurance companies each of which must have
<br />an A.M. Best Company fInancial and perfonnance rating of A-IX or better and are qualified or authorized
<br />by the laws of the State of Texas to assume the risks covered by such policy, (ii) shall provide that such
<br />policy shall not be canceled or modifIed without at least thirty (30) days prior written notice to City, and
<br />(iii) shall provide that any loss otherwise payable thereunder shall be payable notwithstanding any act or
<br />negligence of JQH which might, absent such agreement, result in a forfeiture of all or a part of such
<br />insurance payment. JQH shall promptly pay all premiums when due on such insurance and, not less than
<br />fifteen (15) days prior to the expiration dates of each such policy, JQH will deliver to City acceptable
<br />evidence of insurance, such as a renewal policy or policies marked "premium paid" or other evidence
<br />satisfactory to City reflecting that all required insurance is current and in force. JQH will immediately
<br />give Notice to City of any cancellation of, or change in, any insurance policy. City shall not, because of
<br />accepting, rejecting, approving or obtaining insurance, incur any liability for (A) tlle existence,
<br />nonexistence, form or legal sufficiency thereof, (B) the solvency of any insurer, or (C) the payment of
<br />losses. JQH may satisfy any insurance requirement hereunder by providing one or more "blanket"
<br />insurance policies, subject to City's approval in each instance as to limits, coverages, forms, deductibles,
<br />inception and expiration dates, and cancellation provisions.
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<br />5.2 Existence and Compliance. Maintain its existence, good standing and qualification to do
<br />business, where required, and comply with all laws, regulations and governmental requirements
<br />
<br />CITY OF SAN MARcos-JQH LOAN AGREEMENT
<br />779097.9
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