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<br />Loan No �0�252176 ' � ° D E Con�t nued) � � � � � � � � � Page 4
<br />Application of Proceeds. Trustor shall promptly notity Lender of any loss or demage to the Property. Lender may
<br />make proof of loss if Trustor fails to do sa w(thin fifteen (15) days of the cesualty. Whether or not Lender's
<br />security is impaired, Lender may, at Lender's election, receive end retein the proceeds of any insurence end epply
<br />the proceeds to the reduction of the Indebtedness, payment of any lien affecting the Property, or the restoration
<br />and repair of the Property. If Lender elects to apply the proceeds to restoration and repair, Trustor shall repair or
<br />replace the dameged or destroyed Improvements in a menner satisfactory to Lender. Lender shall, upon
<br />satisfactory proof of such expenditure, pay or reimburse Trustor from the proceeds for the reasonable cost of
<br />repair or restoration if Trustor is not in default under this Deed of Trust. Any proceeds wh(ch have not been
<br />disbursed within 1 SO days efter their receipt and which Lender has not committed to the repeir or restoretion of
<br />the Property shali be used first to pay any amount owing to Lender under this Deed of Trust, then to pay accrued
<br />interest, and the remainder, if any, shell be epplied to the principel balance of the Indebtedness. If Lender holds
<br />any proceeds after payment in full of the Indebtedness, such proceeds shall be peid to Trustor as Trustor's
<br />interests may appear.
<br />Trustor's Report on Insurance. Upon request of Lender, however not more than once a year, Trustor shall furnish
<br />to Lender e report on each existing policy of insurence showing: (1) the name of the insurer; (2) the risks
<br />insured; (3) the amount of the policy; (4) the property insured, the then current replacement value of such
<br />property, end the manner of determining that value; and (5) the expiration date of the policy. Trustor shall, upon
<br />request of Lender, have an independent appraiser satisfactory to Lender determine the cash value replacement cost
<br />of the Property.
<br />LENDER'S EXPENDITURES. If any action or proceeding is commenced that would materially effect Lender's interest in
<br />the Property or if Trustor tails to comply with any provision of this Deed of Trust or eny Releted Documents, including
<br />but not limited to Trustor's failure to discharge or pey when due any amounts Trustor is required to discharge or pey
<br />under this Deed of Trust or any Related Documents, Lender on Trustor's behalf may (but shall not be obligeted to) take
<br />any action that Lender deems appropriate, including but not limited to discharging or paying ell taxes, liens, security
<br />interests, encumbrances end other cleims, at any time levied or placed on the Property and paying all costs for (nsuring,
<br />maintaining and preserving the Property. All such expenditures incurred or paid by Lender for such purposes will then
<br />bear interest at the rate charged under the Note from the date incurred or paid by Lender to the date of repayment by
<br />Trustor. All such expenses will become a pert of the Indebtedness and, at Lender's opt(on, will (A) be payable on
<br />demand; (B) be added to the balance of the Note and be apportioned among and be payable with eny installment
<br />payments to become due during either (1) the term of any applicable insurance policy; or (2) the remaining term of
<br />the Note; or (C) be treated as a balloon payment which will be due and payable at the Note's maturity. The Deed of
<br />Trust also will secure payment of these amounts. Such right shall be in addition to all other rights and remedies to
<br />which Lender may be entitled upon Default.
<br />WARRANTY; DEFENSE OF TITLE. The following provisions relating to ownership of the Property are a pert of this Deed
<br />of Trust:
<br />Title. Trustor warrants that: (a) Trustor holds good and marketable title of record to the Property in fee simple,
<br />free and clear of all liens and encumbrences other then those set forth in the Real Property description or in any
<br />title insurance policy, title report, or final title opinion issued in favor of, end eccepted by, Lender in connection
<br />with this Deed of Trust, and (b) Trustor hes the full right, power, end authority to execute and deUver this Deed of
<br />Trust to Lender.
<br />Defense of Title. Subject to the exception in the paragraph above, Trustor werrants and will forever defend the
<br />title to the Property against the lawful claims of all persons. In the event any ection or proceeding is commenced
<br />that questions Trustor's title or the interest of Trustee or Lender under this Deed of Trust, Trustor shall defend the
<br />action at Trustor's expense. Trustor may be the nominal perty in such proceeding, but Lender shall be entitled to
<br />participete in the proceeding and to be represented in the proceeding by counsel of Lender's own choice, end
<br />Trustor will deliver, or cause to be delivered, to Lender such instruments as Lender may request from time to time
<br />to permit such participation.
<br />Compliance With Laws. Trustor warrants thet the Property and Trustor's use of the Property complies with all
<br />existing applicable laws, ordinances, and regulations of governmental authorities.
<br />Survival of Representations and Warrarrties. All representetions, warranties, and agreements made by Trustor in
<br />this Deed of Trust shall survive the execution and delivery of this Deed of Trust, shall be contfnuing in nature, and
<br />shall remain in full force end effect until such time es Borrower's Indebtedness shall be paid in full.
<br />CONDEMNATION. The following provisions relating to condemnation proceedings are a pert of this Deed of Trust:
<br />Proceedings. If any proceeding in condemnation is filed, Trustor shall promptly notify Lender in writing, and
<br />Trustor shall promptly take such steps as may be necessary to defend the ection end obtein the ewerd. Trustor
<br />may be the nominal party in such proceeding, but Lender shall be entitled to perticipate in the proceeding and to be
<br />represented in the proceeding by counsel of its own choice, end Trustor will deliver or cause to be delivered to
<br />Lender such instruments and documentation as may be requested by Lender from time to time to permit such
<br />participation.
<br />Applicadon of Net Proceeds. If all or any part of the Property is condemned by eminent domain proceedings or by
<br />any proceeding or purchase in lieu of condemnatfon, Lender may at its election require that all or any portion of the
<br />net proceeds of the award be applied to the Indebtedness or the repair or restoration of the Property. The net
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