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subject to deductible clauses of not to exceed $100,000 for any one loss. Such insurance may be <br /> maintained as part of or in conjunction with any other fire and extended coverage insurance carried by <br /> such Member and may be maintained in whole or in part in the form of insurance maintained through <br /> a joint exercise of powers authority created for such purpose or in the form of self-insurance by such <br /> Member. <br /> Each Member agrees to procure and maintain, or cause to be procured and maintained, <br /> throughout the term of its Lease Agreement,insurance against earthquake loss or damage to its Leased <br /> Premises in such amounts as an independent insurance consultant shall annually determine is necessary <br /> to protect such Member for such risk. Such insurance may be subject to a deductible clause of not to <br /> exceed ten percent(10%)for any one loss. Such insurance may be maintained as part of or in conjunction <br /> with any other insurance coverage carried by such Member. If such Member cannot purchase such <br /> insurance on the open market from reputable insurers at reasonable cost, such Member agrees to self- <br /> insure for such coverage. <br /> Rental Interruption Insurance. Each Member shall procure and maintain through the term of its <br /> Lease Agreement, rental interruption or use and occupancy insurance, if commercially available, to <br /> cover loss, total or partial, of the use of any part of its Leased Premises during the term of its Lease <br /> Agreement as a result of any of the hazards covered in the insurance required by its Lease Agreement, <br /> in an amount at least equal to two times the portion of the Reserve Requirement allocable to such <br /> Member. The Net Proceeds of such insurance shall be paid to the Trustee and deposited in the Bond <br /> Fund, and shall be credited towards the payment of its Lease Payments in the order in which such <br /> Lease Payments would otherwise come due and be payable. <br /> Title Insurance. On or before the Closing Date such Member shall, at its expense, (a) cause its <br /> Lease Agreement and the Site and Facility Lease, or a memorandum thereof or thereof, and a <br /> memorandum of the assignment made pursuant to the Indenture, in each case in form and substance <br /> approved by Bond Counsel, to be recorded in the office of the San Bernardino County Recorder,and(b) <br /> obtain a CLTA policy of title insurance which insures such Member's leasehold estate in its Leased <br /> Premises in an amount equal to the aggregate principal amount of the Bonds.All Net Proceeds received <br /> under said policy shall be deposited with the Trustee in the Redemption Fund and shall be applied to <br /> the redemption of Bonds pursuant to the Indenture. <br /> Net Proceeds of Insurance; Form of Policies. Each policy of insurance required by its Lease <br /> Agreement shall provide that all proceeds thereunder shall be payable to the Trustee as and to the <br /> extent required under its Lease Agreement. All required insurance policies shall be provided by a <br /> commercial insurer rated "A+" by A.M. Best & Company or rated in one of the two highest rating <br /> categories by Moody's and S&P. Each Member shall pay or cause to be paid when due the premiums <br /> for all insurance policies required by its Lease Agreement. The Trustee shall not be responsible for the <br /> sufficiency of any insurance required in its Lease Agreement,including any forms of self-insurance and <br /> shall be fully protected in accepting payment on account of such insurance or any adjustment, <br /> compromise or settlement of any loss. Each Member shall cause to be delivered annually on or before <br /> each June 1 to the Trustee a certification, signed by a County Representative, stating compliance with <br /> the provisions of its Lease Agreement.The Trustee shall be entitled to rely on such certification without <br /> independent investigation. Each Member shall have the adequacy of any insurance reserves <br /> maintained by such Member or by a joint exercise of powers authority,if applicable, for purposes of the <br /> insurance required by its Lease Agreement reviewed at least annually, on or before each June 1, by an <br /> independent insurance consultant and shall maintain reserves in accordance with the recommendations <br /> of such consultant to the extent moneys are available for such purpose and not otherwise appropriated. <br /> Tax Covenants <br /> Federal Guarantee Prohibition. Each Member agrees that it shall not take any action or permit or <br /> suffer any action to be taken if the result of the same would be to cause any of the Bonds to be <br /> "federally guaranteed" within the meaning of section 149(b)of the Code. <br /> Appendix A <br /> Page 21 <br />