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e A DEED OF TRUST el:.
<br />Loan No: 776244 2003000:9 (Conitinued) Page 3
<br />Maintenance of Insurance. Truster shall procure and maintain policies of fire insurance with standard extended coverage endorsements on
<br />a fair value basis for the full Insurable value covering all Improvements an the Real Property in an amount sufficient to avoid application of
<br />any coinsurance clause, and with a standard mortgagee clause in favor of Lender. Truster shall also procure and maintain comprehensive
<br />general liability insurance in such coverage amounts as Lender may request with Trustee and Lender being named as additional insureds in
<br />such liability insurance policies. Additionally, Truster shall maintain such other insurance, including but not limited to hazard, business
<br />interruption, and bailer insurance, as Lender may reasonably require. Policies shall be written in form, amounts, coverages and basis
<br />reasonably acceptable to Lender and issued by a company or companies reasonably acceptable to Lender. Truster, upon request of
<br />Lender, wjll deliver to Lender from time to time the policies or certificates of insurance in form satisfactory to Lender, including stipulations
<br />that coverages wilt not be cancelled or diminished without at least ten (10) days prior written notice to Lender. Each insurance policy also
<br />shall include an endorsement providing that coverage in favor of Lender will not be impaired in any way by any act, omission or default of
<br />Truster or any other person. Should the Real Property be located in an area designated by the Director of the Federal Emergency
<br />Management Agency as a special flood hazard area. Truster agrees to obtain and maintain Federal Flood Insurance, if available, within 45
<br />days after notice Is given by Lender that the Property is located in a special flood hazard area, for the full unpaid principal balance of the loan
<br />and any prior liens on the property securing the loan, up to the maximum policy limits set under the National Flood Insurance Program, or as
<br />otherwise required by Lender, and to maintain such insurance for the term of the loan.
<br />Application of Proceeds. Truster shall promptly notify Lender of any loss or damage to the Property. Lender may make proof of loss If
<br />Truster fails to do so within fifteen (15) days of the casualty. Whether or not Lender's security is impaired, Lender may. at Lender's election,
<br />receive and retain the proceeds of any insurance and apply the proceeds to the reduction of the Indebtedness, payment of any lien affecting
<br />the Property, or the restoration and repair of the Property. If Lender elects to apply the proceeds to restoration and repair, Truster shall
<br />repair or replace the damaged or destroyed Improvements in a manner satisfactory to Lender. Lender shall, upon satisfactory proof of such
<br />expenditure, pay or reimburse Truster from the proceeds for the reasonable cast of repair or restoration if Truster is not In default under this
<br />Deed of Trust. Any proceeds which have not been disbursed within 180 days after their receipt and which Lender has not committed to the
<br />repair or restoration of the Property shall 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, shalt be applied to the principal balance of the Indebtedness. If Lender holds any proceeds after payment
<br />In full of the Indebtedness, such proceeds shall be paid to Truster as Trustor's interests may appear.
<br />Trustor's Report on Insurance. Upon request of Lender, however not more than once a year, Trustor shall furnish to Lender a report on
<br />each existing policy of insurance showing: (1) the name of the Insurer; (2) the risks insured; (3) the amount of the policy; (4) the
<br />property insured, the then current replacement value of such property, and the manner of determining that value; and (5) the expiration
<br />date of the policy. Trustor shall, upon request of Lender, have an independent appraiser satisfactory to Lender determine the cash value
<br />replacement cost of the Property .
<br />LENDER'S ERPENDITURES. If any action or proceeding is commenced that would materially affect Lender's interest in the Property or if Truster
<br />fails to comply with any provision of this Deed of Trust or any Related Documents, including but not limited to Trustor's failure to discharge or pay
<br />when due any amounts Truster is required to discharge or pay under this Dead of Trust or any Related Documents, Lender on Trustor's behalf
<br />may (but shall not be obligated to) take any action that Lender deems appropriate, including but not limited to discharging or paying all taxes,
<br />liens, security interests, encumbrances and other claims, at any time levied or placed on the Property and paying all costs for insuring, maintaining
<br />and preserving the Property. All such expenditures incurred or paid by Lender for such purposes will then bear interest at the rate charged under
<br />the Note from the date incurred or paid by Lender to the date of repayment by Truster. All such expenses will become a part of the Indebtedness
<br />and, at Lender's option, wilt (A) be payable on demand; (a) be added to the balance of the Note and be apportioned among and be payable
<br />with any installment payments to become due during either (1) the term of any applicable insurance policy; or (2) the remaining term of the
<br />Note; or (C) be treated as a balloon payment which will be due and payable at the Note's maturity. The Deed of Trust also will secure payment
<br />of these amounts. Such right shall be in addition to all other rights and remedies to which Lender may be entitled upon Default.
<br />WARRANTY; DEFENSE OF TITLE. The following provisions relating to ownership of the Property are a pad of this Dead of Trust:
<br />Title. Truster warrants that: (a) Truster holds goad and marketable title of record to the Property in fee simple, free and clear of all liens and
<br />encumbrances other than those set forth in the Real Property desorption or in any title insurance policy, title report, or final title opinion
<br />issued in favor of, and accepted by, Lender In connection with this Deed of Trust, and (b) Truster has the full right, power, and authority to
<br />execute and deliver this Used of Trust to Lender.
<br />Defense of Title. Subject to the exception in the paragraph above, Truster warrants and will forever defend the title to the Property against
<br />the lawful claims of all persons. In the event any action or proceeding is commenced that questions Trustor's title or the interest of Trustee or
<br />Lender under this Deed of Trust, Truster shall defend the action at Trustor's expense. Truster may be the nominal party in such proceeding,
<br />but Lender shall be entitled to participate in the proceeding and to be represented in the proceeding by counsel of Lender's own choice. and
<br />Truster will deliver, or cause to be delivered, to Lender such instruments as Lender may request from time to time to permit such
<br />participation.
<br />Compliance With Laws. Truster warrants that the Property and Tru lofe use of the Property complies with all existing applicable laws,
<br />ordinances, and regulations of governmental authorities.
<br />Survival of Representations and Warranties. All representations, warranties, and agreements made by Truster in this Deed of Trust shall
<br />survive the execution and delivery of this Deed of Trust, shall be continuing in nature, and shall remain in full force and effect until such time
<br />as Trustor's Indebtedness shall be paid In full.
<br />CONDEMNATION. The fallowing provisions relating to condemnation proceedings are a part of this Deed of Trust:
<br />Proceedings. If any proceeding in condemnation is filed, Truster shall promptly notify Lender in writing, and Truster shall promptly lake such
<br />steps as may be necessary to defend the action and obtain the award. Truster may be the nominal party in such proceeding, but Lender
<br />shall be entitled to participate in the proceeding and to be represented in the proceeding by counsel of its own choice, and Trustor will
<br />deliver or cause to be delivered to Lender such instruments and documentation as may be requested by Lender from time to time to permit
<br />such participation.
<br />Application of Net Proceeds. If all or any part of the Property is condemned by eminent domain proceedings or by any proceeding or
<br />purchase In lieu of condemnation, Lender may at its election require that all or any portion of the net proceeds of the award be applied to the
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