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for bodily and personal injury, death or property damage occasioned by reason of the operation of its <br /> Leased Premises. Said policy or policies shall provide coverage in the minimum liability limits of <br /> $1,000,000 for personal injury or death of each person and$3,000,000 for personal injury or deaths of two <br /> or more persons in each accident or event, and in a minimum amount of $100,000 (subject to a <br /> deductible clause of not to exceed$5,000) for damage to property resulting from each accident or event. <br /> Such public liability and property damage insurance may, however, be in the form of a single limit <br /> policy in the amount of $3,000,000 covering all such risks. Such liability insurance may be maintained <br /> as part of or in conjunction with any other liability insurance coverage carried by such Member, and <br /> may be maintained in the form of insurance maintained through a joint exercise of powers authority <br /> created for such purpose or in the form of self-insurance by such Member. The Net Proceeds of such <br /> liability insurance shall be applied toward extinguishment or satisfaction of the liability with respect to <br /> which the insurance proceeds shall have been paid. <br /> Fire and Extended Coverage Insurance. Each Member shall procure and maintain, or cause to be <br /> procured and maintained, throughout the term of its Lease Agreement, insurance against loss or <br /> damage to any structures constituting part of its Leased Premises by fire and lightning, with extended <br /> coverage and vandalism and malicious mischief insurance. Said extended coverage insurance shall, as <br /> nearly as practicable, cover loss or damage by explosion, windstorm, riot, aircraft, vehicle damage, <br /> smoke and such other hazards as are normally covered by such insurance. Such insurance shall be in an <br /> amount equal to the greater of (a) one hundred percent (100%) of the replacement cost of its Leased <br /> Premises, or (b) the aggregate principal amount of the Outstanding Bonds. Such insurance may be <br /> 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 Orange County Recorder, and (b) obtain <br /> a CLTA policy of title insurance which insures such Member's leasehold estate in its Leased Premises in <br /> an amount equal to the aggregate principal amount of the Bonds. All Net Proceeds received under said <br /> policy shall be deposited with the Trustee in the Redemption Fund and shall be applied to the <br /> 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 /> Appendix A <br /> Page 21 <br />