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DEED OF TRUST (Continued) 200209907 Page to pay, se long as Lenders interest in Me Property is not jeupardized. If a lien arises or is filed as a result of nonpayment, Truster shall within fifteen (15) days after the lien arises or, if a lien is filed, witllin fifteen (15) days after Truster has notice of the filing, secure the discharge of the lien, or if requested by Lender, deposit with Lender cash or a sufficient corporate surety bond or other security satisfactory to Lender in an amount sufficient to discharge the lien plus any costs and attorneys' fees, or other charges that could accrue as a result of a foreclosure or sale under Me lien. In any contest, Truster shall defend itself and Lender and shall satisfy any adverse judgment before enforcement against Me Property. Truster shall name Lender as an additional obligee under any surety bond fumish xJ in the contest proceedings. Evidence of Payment Trustor shall upon demand furnish to Lender satisfactory evidence of payment of the taxes or assessments and shall authorize the appropriate governmental official to deliver to Lender at any time a written statement of Me taxes and assessments against the Property. Notice of Construction. Trustor shall notify Lender at least fifteen (15) days before any work is commenced, any services are furnished, or any materials are supplied to the Property, M any mechanic's lien, materialmen's lien, or other lien could be asserted on account of the work, services, or materials. Trustor will upon request of Leader furnish to Lender advance assurances satisfactory to Lender that Truster can and will pay the cost of such improvements. PROPERTY DAMAGE INSURANCE. The following provisions relating to insuring the Property are a part of this Deed of Trust. Maintenance of Insurance. Trustor shall procure and maintain policies of fire insurance with standard extended coverage endorsements on a replacement basis for the full insurable value covering all Improvements on the Real Property in an amount sufficient to avoid application of any coinsurance clause, and with a standard mortgagee clause in favor of Lender, together with such other hazard and liability insurance as Lender may reasonably require. Policies shall be written in form, amounts, coverages and basis reasonably acceptable to Lender and issued by a company or companies reasonably acceptable to Lender. Trustor, upon request of Lender, will deliver to Lender from time to time the policies or certificates of insurance in forth satisfactory to Lender, including stipulations Mat coverages will not be cancelled or diminished without at least ten (10) days prior written notice to Leader. Each insurance policy also shall include an endorsement providing Mat coverage in favor of Lender will not be impaired in any way by any act, omission or default of Trustor or any other person. Should the Real Property be located in an area designated by the Director of the Federal Emergency Management Agency as a special flood hazard area, Trustor agrees to obtain and maintain Federal Flood Insurance, I available, within 4 days after notice is given by Lender Mat the Property is located in a special flood hazard area for the full unpaid principal balance of the lean 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 otherwise required by Lender, and to maintain such insurance for the term of the lean. Application of Proceeds. Trustor shall promptly notiy Lender of any loss or damage to the Property. Lender may make proof of loss if Trustor fails to do so within fifteen (15) days of the casualty. Whether or not Lenders security is impaired, Lender may, at Lender's election, receive and retain Me proceeds of any insurance and apply the proceeds to the reduction of the Indebtedness, payment of any lien affecting the Property, or the restoration and repair of the Property. If Lender elects to apply Me proceeds to restoration and repair, Truster shall repair or replace the damaged or destroyed Improvements in a manner satisfactory to Lender. Leader shall, upon satisfactory proof of such expenditure, pay or reimburse Trustor from the proceeds for the reasonable cast of repair or restoration if Trustor is not in default under this Deed of Trust. Any proceeds which have not been disburse l within 180 days after their receipt and which Lender has not committed to Me repair or restoration of the Property shall nd used first to pay any amount owing to Lender under this Deed of Trust, then to pay accrued interest, and the remainder, tl any, shall be applied to the principal balance of Me Indebtedness. If Lender holds any proceeds after payment in full of the Indebtedness, such proceeds shall be paid to Trustor as Truster's interests may appear. Compliance with Existing Indebtedness. During the period in which any Existing Indebtedness described below is in effect, compliance with Me insurance provisions contained in Me instrument evidencing such Existlng Indebtedness shall constitute compliance with the insurance provisions under this Deed of Trust, to the extent compliance with Me terms of this Deed of Trust would constitute a duplication of insurance requirement. If any proceeds from Me insurance become payable on loss, the provisions in this Deed of Trust for division of proceeds shall apply only M that portion of Me proceeds net payable to Me holder of the Existing Indebtedness. LENDER'S EXPENDITURES. If Truster fails (A) to keep Me Property free of all taxes, liens, security interests, encumbrances, and other claims, (B) to provide any required insurance on the Property, (C) to make repairs to Me Property, or to comply with any obligation to maintain Existing Indebtedness in good standing as required below, then Lender may do so. If any action or proceeding is commenced that would materially affect Lender's interests in the Property, Men Leader on Truster's behalf may, but is not required td, take any action that Lender believes to be appropriate to protect Lenders interests. All expenses incurred or paid by Lender for such purposes will then bear interest at the rate charged under the Credit Agreement from the date incurred or paid by Lender to the date of repayment by Trustor. All such expenses will become a part of the Indebtedness and, at Lender's option, will (A) be payable on demand; (B) he added to Me balance of Me Coal Agreement and be apportioned among and be payable with any installment payments to became due during either (1) Me term of any applicable insurance policy; or (2) Me remaining term of the Credit Agreement; or (C) he treated as a balloon payment which will be due and payable at Me Credit Agreement's maturity. The Dead of Trust also will secure payment of these amounts. The rights provided for in this paragraph shall be in addition to any other rights or any remedies to which Lender may be, entitled on account of any default. Any such action by Lender shall not be construed as curing Me default so as to bar Lender from any remedy that it otherwise would have had. WARRANTY; DEFENSE OF TITLE. The following provisions relating to ownership of Me Property are a part of this Dead of Trust: Title. Truster warrants that: (a) Truster holds good and marketable title of record to the Property in fee simple, free and clear of all liens and encumbrances other than these set form in the Real Property description or in the Existing Indebtedness section below or in any title insurance policy, title report, or final title opinion issued in favor of, and accepted by, Lender in connection with this Deed of Trust, and (b) Trustor has the full right, power, and authority to execute and deliver this Deed of Trust to Lender. Defense of Title. Subject to Me exception in Me paragraph above, Trustor warrants and will forever defend the title to Me Property against the lawful claims of all persons. In the event any action or proceeding is commenced that questions Truster's tPoe or the interest of Trustee or Lender under this Dead of Trust, Trustor shall defend the action at Truster's expense. Trustor may be the nominal parry in such proceeding, but Lender shall be Settled to participate in Me proceeding and to be represented in the proceeding by counsel of Lender's own choice, and Truster will deliver, or cause to be delivered, M Lender such instruments as Lender may request from time to time to permit such participation.