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compared to the remainder thereof and taking into consideration the extent, if any, to which <br /> Lessee's use of the remainder of the Premises shall have been impaired or interfered with by <br /> reason of such partial taking or condemnation. If Lessor and Lessee are unable to agree as to a <br /> just reduction in such Rent payments, the matter shall be submitted to arbitration as provided in <br /> Article 21. <br /> Section 12.3 Award. If a part of the Premises and improvements be taken under the <br /> power of eminent domain, or by condemnation proceedings and this Lease is terminated by <br /> reason of such partial taking, and no Work (as hereinafter defined) will have to be performed as a <br /> result thereof, then the award will be distributed to the holders of any Permitted Debt and to <br /> Lessor in accordance with Section 12.1. If a part of the Premises and improvements be taken <br /> under the power of eminent domain or by condemnation proceedings and this Lease is not <br /> terminated by reason of such partial taking, the award, including that made by reason of the <br /> taking of a portion(and the damages to the balance) of the improvements and appurtenances <br /> placed thereon by Lessee shall be payable to Lessee as follows: <br /> 12.3.1 If the balance of said award or awards (including compensation for the <br /> Regional Center or other buildings or improvements or portions thereof taken, and damages, if <br /> any, to the parts of the Regional Center and other buildings or improvements not so taken) <br /> payable to Lessee (herein sometimes referred to as "Lessee's Condemnation Proceeds") shall <br /> be in an amount of One Million Dollars ($1,000,000) or less, such Lessee's Condemnation <br /> Proceeds shall be paid to Lessee for application by Lessee to the Work, or if an amount in excess <br /> of One Million Dollars ($1,000,000) shall be paid to and deposited in a Joint Account and shall <br /> be held and disbursed in accordance with Article 6. <br /> 12.3.2 Lessee shall commence and thereafter proceed with reasonable <br /> diligence to repair, alter and restore the remaining part of the Regional Center or other buildings <br /> or improvements so as to constitute a functional Regional Center, subject to such changes or <br /> alterations as Lessee and Lessor may reasonably agree to make (the "Work"); provided, that the <br /> obligation of Lessee to so repair and restore shall be limited to Lessee's Condemnation Proceeds. <br /> Should the cost of the Work be estimated by an architect or engineer reasonably acceptable to <br /> Lessor and Lessee to be in excess of Lessee's Condemnation Proceeds and Lessee fails to <br /> commence to repair, alter and restore the remaining part of the Regional Center or other <br /> buildings or improvements within ninety(90) days after the amount of Lessee's Condemnation <br /> Proceeds is finally determined, or within ninety(90) days of the time that an earlier payment is <br /> made in an amount sufficient to commence the Work, Lessor shall have the option to terminate <br /> this Lease by giving written notice thereof to Lessee, subject, however, to the rights of the <br /> holders of any Permitted Debt as set forth in Section 11.1. Notwithstanding any provision to the <br /> contrary in this Lease, the termination option of Lessor set forth in the preceding sentence shall <br /> be the sole and exclusive recourse that Lessor may take against Lessee as a result of Lessee's <br /> failure to commence the Work as aforesaid. In the event of a termination of this Lease as a result <br /> of Lessee's failure to commence and perform the Work, this Lease shall terminate and come to <br /> an end as of the date of the taking and Lessee's Condemnation Proceeds in excess of the amount <br /> needed to discharge any Permitted Debt shall be allocated between Lessor and Lessee in the <br /> same manner as provided in Section 12.1. If Lessee performs the Work but the actual cost of the <br /> 23 <br /> GROUND LEASE COE--EPFD <br />