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DEED OF TRUST ' 200�00 574
<br />Loan No: 776324 (Continued) Page 3
<br />in form satisfactory to Lender, including stipulations that coverages will not be cancelled or diminished without at least tan 110) days
<br />prior written notice to Lender. Each insurance policy also shall Include an endorsement providing that coverage in favor of Lender will
<br />not be impaired in any way by any act, omission or default of Truster or any other person. Should the Real Property be located in an
<br />area designated by the Director of the Federal Emergency Management Agency as.a special flood hazard area, Truster agrees to
<br />obtain and maintain Federal Flood Insurance, if available, within 45 days after notice is given by Lender that the Property is located in
<br />a special flood hazard area, tar the full unpaid principal balance of the loan and any prior liens on the property securing the loan, up to
<br />the maximum policy limits set under the National Flood Insurance Program, or as otherwise required by Leni and to maintain such
<br />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
<br />it 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
<br />election, receive and retain the proceeds of any insurance and apply the proceeds to the reduction of the Indebtedness, payment of
<br />any lien affecting the Property, or the restoration and repair of the Property. If Lender elects to apply the proceeds to restoration and
<br />repair, Truster shall repair or replace the damaged or destroyed Improvements in a manner satisfactory to Lender. Lender shall, upon
<br />satisfactory proof of such expenditure, pay or reimburse Truster from the proceeds for the reasonable cost of repair or restoration if
<br />Truster is not in default under this Deed of Trust. Any proceeds which have not been disbursed within 180 days after their receipt
<br />and which Lender has not committed to the repair or restoration of the Property shall be used first to pay any amount owing to Lender
<br />under this Deed of Trust, then to pay accrued interest, and the remainder, if any, shall be applied to the principal balance of the
<br />Indebtedness. It Lender holds any proceeds after payment in full of the Indebtedness, such proceeds shall be paid to Truster as
<br />Turner interests may appear.
<br />Trustor's Report on Insurance. Upon request of Lender, however not more than once a year, Truster shall furnish to Lender a report
<br />on each existing policy of insurance showing: (11 the name of the insurer; 12) the risks insured, (3) the amount of the policy; (4)
<br />the property insured, the then current replacement value of such property, and the manner of determining that value; and (5) the
<br />expiration date of the thicy. Truster shall, upon request of Lender, have an independent appraiser satisfactory to Lender determine
<br />the cash value replacement cost of the Property.
<br />LENDER'S EXPENDITURES. If any action or proceeding is commenced that would materially affect Lender's interest in the Property or If
<br />Truster falls to comply with any provision of this Deed of Trust or any Related Documents, including but not limited to Trustor'a failure to
<br />discharge or pay when due any amounts Truster is required to discharge or pay under this Deed of Trust or any Related Documents. Lender
<br />on Trustor's behalf may (but shall not be obligated tol take any action that Lender deems appropriate, including but not limited to
<br />discharging or paying all taxes, liens, security interests, encumbrances and other claims, at any time levied or placed on the Property and
<br />paying all costs for insuring, maintaining and preserving the Property. All such expenditures incurred or paid by Lender for such purposes
<br />will then bear interest at the rate charged under the Note from the date incurred or paid by Lender to the date of repayment by Truster. All
<br />such expenses will became a part of the Indebtedness and, at Lender's option, will (A) be payable on demand; IBI be added to the
<br />balance of the Note and be apportioned among and be payable with any Installment payments to become due during either 11) the term of
<br />any applicable insurance policy; or (2) the remaining term of the Note; or (C) be treated as a balloon payment which will be due and
<br />payable at the Note's maturity. The Deed of Trust also will secure payment of these amounts. Such right shall be in addition to all other
<br />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 part of this Deed of Trust:
<br />Title. Truster warrants that: lal Truster holds good and marketable title of record to the Property in fee simple, free and clear of all
<br />liens and encumbrances other than those set forth in the Real Property description or in any title insurance policy, title report, or final
<br />title opinion issued in favor of, and accepted by, Lender in connection with this Deed of Trust, and lb) Truster has the full right,
<br />power, and authority to execute and deliver this Deed of Trust to Lender.
<br />Defense of Tile. Subject to the exception in the paragraph above, Truster warrants and will forever defend the title to the Property
<br />against the lawful claims of all persons. In the event any action or proceeding Is commenced that questions Trustor's title or the
<br />interest of Trustee or Lender under this Deed of Trust, Truster shall defend the action at Truster re expense. Truster may be the
<br />nominal party in such proceeding, but Lender shall be entitled to participate in the proceeding and to be represented In the proceeding
<br />by counsel of Lender's own choice, and Trustor will deliver, or cause to be delivered, to Lender such instruments as Lender may
<br />request from time to time to permit such participation.
<br />Compliance With Laws. Truster warrants that the Property and Trustor's use of the Property complies with all existing applicable
<br />laws, 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
<br />shall survive the execution and delivery of this Deed of Trust, shall be continuing in nature, and shall remain In full force and effect
<br />until such time as Trustor's Indebtedness shall be paid In full.
<br />CONDEMNATION. The following provisions relating to condemnation proceedings are a part of this Deed of Trust:
<br />Proceedings. It any proceeding in condemnation is filed, Truster shall promptly notify Lender in writing, and Truster shall promptly
<br />take such steps as may be necessary to defend the action and obtain the award. Truster may be the nominal party in such
<br />proceeding, but Lender shall be entitled to participate in the prooseding and to be represented in the proceeding by counsel of its awn
<br />choice, and Truster will deliver or cause to be delivered to Lender such Instruments and documentation as may be requested by
<br />Lender from time to time to permit such participation.
<br />Application of Net Proceeds. If all or any pan 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
<br />to the Indebtedness or the repair or restoration of the Property. The net proceeds of the award shall mean the award after payment of
<br />all reasonable costs, expenses, and attorneys fees Incurred by Trustee or Lender in connection with the condemnation.
<br />IMPOSITION OF TAXES. FEES AND CHARGES BY GOVERNMENTAL AUTHORITIES. The following provisions relating to governmental
<br />taxes, fees and charges are a part of this Deed of Trust.
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