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200010985
<br />kind, now or hereafter levied against the Property or any part thereof, before delinquency, without notice
<br />or demand, and shall provide Lenders with evidence of the payment of same. Borrower shall pay all
<br />taxes and assessments which may be levied upon Lender's interest herein or upon this Deed of Trust or
<br />the debt secured hereby, without regard to any law that may be enacted imposing payment of the whole
<br />or any part thereof upon the Lenders.
<br />3. INSURANCE AND REPAIRS: Borrower shall maintain fire and extended coverage
<br />insurance insuring the improvements and buildings constituting part of the Property for an amount no
<br />less than the fair market value or replacement cost thereof (co- insurance not exceeding 80% permitted).
<br />Such insurance policy shall contain a standard mortgage clause in favor of Lenders and shall not be
<br />cancelable, terminable or modifiable without ten (10) days prior written notice to Lenders. Borrower shall
<br />promptly repair, maintain and replace the Property or any part thereof so that, except for ordinary wear
<br />and tear, the Property shall not deteriorate. In no event shall the Borrower commit waste on or to the
<br />Property.
<br />4. USE & PRESERVATION OF PROPERTY: Trustors shall use the premises for lawful
<br />residential purposes only; shall not substantially change the Property, allow the Property to deteriorate,
<br />or commit or permit waste. Trustors shall comply with all laws and regulations applicable to the use of
<br />the Property, and shall maintain the improvements thereon in good repair.
<br />5. PROTECTION OF TRUST PROPERTY: If Trustors fail to pay taxes or assessments,
<br />maintain insurance or maintain the Property as provided herein, Beneficiary may pay any such amounts
<br />or take steps to protect the value of the Property and the rights of Beneficiary in the Property. Any sums
<br />Beneficiary may advance for payment of any such taxes or assessments, maintenance and protection of
<br />the Property shall be secured by this Trust Deed, shall constitute a debt due from Trustors to
<br />Beneficiary, and shall bear interest from the date of disbursement until paid at the default rate set forth in
<br />the note.
<br />6. APPLICATION OF PAYMENTS: All payments received by Beneficiary under the Trust Deed
<br />Note and this agreement shall be applied first to reimburse advancements made by Beneficiary for
<br />protection of trust property, second to interest, and the balance to principal.
<br />7. ACTIONS AFFECTING THE PROPERTY: Borrower shall appear in and contest any action
<br />or proceeding purporting to affect the security hereof or the rights or powers of Lenders or Trustee, and
<br />shall pay all costs and expenses, including cost of evidence of title and attorney's fees, in any such
<br />action or proceeding in which Lenders or Trustee may appear. Should Borrower fail to make payment or
<br />to do any act as and in the manner provided in any of the Loan Instruments, Lenders and /or Trustee,
<br />each in its own discretion, without obligation so to do and without notice to or demand upon Borrower
<br />and without releasing Borrower from any obligation, may make or do the same in such manner and to
<br />such extent as either may deem necessary to protect the security hereof. Borrower shall, immediately
<br />upon demand therefore by Lenders, pay all costs and expenses incurred by Lenders in connection with
<br />the exercise by Lenders of the foregoing rights, including without limitation costs of evidence of title,
<br />court costs, appraisals, surveys and attorney's fees. Any such costs and expenses not paid within ten
<br />(10) day of written demand shall draw interest at the default rate provided in the Note.
<br />8. EMINENT DOMAIN: Should the Trust Estate, or any part thereof or interest therein, be taken
<br />or damaged by reason of any public "taking" or in any other manner including deed in lieu of
<br />Condemnation ( "Condemnation "), or should Borrower receive any notice or other information regarding
<br />such proceeding, Borrower shall give prompt written notice thereof to Lenders. Lenders may require
<br />that all compensation, awards and other payments or relief therefore be applied to the debt secured
<br />hereby, and shall be entitled at its option to commence, appear in and prosecute in its own name any
<br />action or proceedings. Lenders shall also be entitled to make any compromise or settlement in
<br />connection with such taking or damage. All such compensation, awards, damages, rights of action and
<br />proceeds awarded to Borrower (the "Proceeds ") are hereby assigned to Lenders and Borrower agrees to
<br />execute such further assignments of the Proceeds as Lenders or Trustee may require.
<br />9. ENVIRONMENTAL MATTERS: Borrower covenants, represents and warrants that:
<br />(a) No pollutants or other toxic or hazardous substances, whether solid, liquid or gas, including
<br />but not limited to LEAD -BASED PAINTS, PETROLEUM PRODUCTS, ASBESTOS, POLYCLORINATED
<br />BIPHENYLS ( "PCB'S "), ACIDS, ALKALIS, CHEMICALS OR ANIMAL WASTE PRODUCTS AND
<br />RUNOFF (INCLUDING MATERIALS TO BE RECYCLED, RECONDITIONED OR RECLAIMED), have
<br />been or shall be applied, discharged, dispersed, released, stored, treated, generated, incorporated into,
<br />or allowed to escape on the property, except those substances that have been identified in writing to
<br />Lenders by substance, location and date of incident;
<br />(b) No underground storage tanks, whether now in use or not, are now or have ever been
<br />located on the Trust Estate, except those tanks that have been identified in writing to Lenders by size,
<br />location, age, substance contained therein, and whether in existence, removed or filled;
<br />(c) The property and Borrowers (including his tenant's) use thereof are in compliance with all
<br />applicable federal, state and local statutes and regulations, and no governmental entity has investigated,
<br />given notice of any violation, filed any lien, or threatened action against Borrower or the property with
<br />respect to any substances above described except those identified in writing to Lenders by entity, date
<br />and description.
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