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at the Company's own expense, maintain, preserve and keep the School Facilities open as a
<br /> schoolhouse, or pursuant to the Lease cause the Charter School to maintain,preserve and keep the
<br /> School Facilities, with the appurtenances and every part and parcel thereof, open as a schoolhouse
<br /> and in good repair,working order and condition and that the Company will from time to time make
<br /> or pursuant to the Lease cause the Charter School to make all repairs, replacements and renewals
<br /> deemed proper and necessary by it. The Company agrees that it will administer, maintain, and
<br /> operate the School Facilities, or pursuant to the Lease cause the Charter School to administer,
<br /> maintain, and operate the School Facilities in a manner such that the School Facilities is open to
<br /> members of the general public,free of discrimination based upon race,creed, color,sex,or national
<br /> origin.
<br /> In addition, the Company has the privilege of remodeling the School Facilities or making
<br /> substitutions,additions,modifications and Improvements to the School Facilities from time to time
<br /> as the Company, in its discretion, may deem to be desirable for the Company's or the Charter
<br /> School's use for such purposes as shall be permitted by the Act and the Charter School Act, the
<br /> costs of which remodeling, substitutions, additions,modifications and Improvements shall be paid
<br /> by the Company, and the same shall be the property of the Company and be included under the
<br /> terms of this Loan Agreement and the Mortgage as part of the School Facilities and the Mortgaged
<br /> Property, respectively; provided, however, that all such remodeling, substitutions, additions,
<br /> modifications and Improvements shall be done in a good and workmanlike manner and in
<br /> compliance with all laws and the School Facilities, as remodeled, improved or altered, upon
<br /> completion of such remodeling, substitutions, additions, modifications and Improvements made
<br /> pursuant to this Section shall be of a value not less than the fair market value of the School
<br /> Facilities immediately prior to the remodeling or the making of substitutions, additions,
<br /> modifications and Improvements. Notwithstanding the foregoing, if such substitution,
<br /> modification, addition or Improvement shall require the expenditure of an amount greater than
<br /> [25%] [10%] of the insured value of the School Facilities (determined at the time such work
<br /> commences), the Company shall, prior to initiating such substitution, modification, addition, or
<br /> Improvement,provide the Trustee with a certificate from the Company Representative to the effect
<br /> that based upon a financial feasibility study prepared by the Company Representative, such
<br /> substitution, modification, addition or Improvement will not materially diminish the amount of
<br /> Lease Revenues from the School Facilities received by the Company or the amount of Pledged
<br /> Revenues during the next succeeding Fiscal Year from the level received in the last preceding
<br /> Fiscal Year prior to such substitution, modification, addition, or Improvement. Any property for
<br /> which a substitution or replacement is made pursuant to this Section may be disposed of by the
<br /> Company in any manner and in the sole discretion of the Company. The Company will not permit
<br /> any mechanics' or other liens to be established or remain against the School Facilities for labor or
<br /> materials furnished in connection with any remodeling, substitutions, additions, modifications,
<br /> Improvements, repairs, renewals or replacements so made by the Company, provided that if the
<br /> Company shall first notify the Trustee in writing of the Company's intention so to do, and shall
<br /> post cash or a bond in the amount of one hundred ten percent (110%) of the amount of the
<br /> mechanics' or other liens to be contested, and if no Event of Default or event which with the
<br /> passage of time would be an Event of Default then exists, the Company may in good faith,
<br /> diligently contest any mechanic's or other lien filed or established against the School Facilities,
<br /> and in such event may permit the items so contested to remain undischarged and unsatisfied during
<br /> the period of such contest and any appeal therefrom unless in the opinion of Independent Counsel
<br /> by nonpayment of any such items the lien of the Indenture as to the payments will be materially
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