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<br />200605846
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<br />purpose for which each debit to the Funds was made. The Funds are hereby pledged as additional
<br />security for the indebtedness secured by this Instrument.
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<br />If the amount of the Funds held by Lender at the time of the annual accounting thereof shall
<br />exceed the amount deemed necessary by Lender to provide for the payment of taxes, assessments,
<br />insurance premiums and Other Impositions, as they fall due, such excess may be refunded to Borrower
<br />following such audit or may be applied by Lender at its option to payments due in the future. If at any
<br />time the amount of the Funds held by Lender shall be less than the amount deemed necessary by Lender
<br />to pay taxes, assessments, insurance premiums and Other Impositions, as they fall due, Borrower shall
<br />pay to Lender any amount necessary to make up the deficiency within thirty (30) days after written notice
<br />from Lender to Borrower requesting payment thereof.
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<br />Upon (a) Borrower's breach of any covenant or agreement of Borrower in this Instrument or (b)
<br />the occurrence of an Event of Default (as such term is defined in the Revolving Loan Agreement), Lender
<br />may apply, in any amount and in any order as Lender shall determine, in Lender's sole discretion, any
<br />Funds held by Lender at the time of application (i) to pay taxes, assessments, insurance premiums and
<br />Other Impositions which then are due or (ii) as a credit against any indebtedness secured by this
<br />Instrument. Upon payment in full of all sums secured by this Instrument, Lender shall promptly refund to
<br />Borrower any unapplied Funds held by Lender.
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<br />Lender hereby agrees to waive its right to require payment of the Funds so long as Borrower does
<br />not default under the Revolving Loan Agreement, this Instrument or any other Loan Documents;
<br />provided, that Borrower provides Lender with timely evidence satisfactory to Lender that all taxes,
<br />assessments, premiums and, if requested by Lender, Other Impositions have been paid in full prior to
<br />delinquency. If such a default occurs or if Borrower does not provide such evidence, Lender may revoke
<br />its waiver at any time thereafter by giving written notice thereof to Borrower.
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<br />3. APPLICATION OF PAYMENTS. Unless applicable law requires otherwise, all
<br />payments received by Lender from Borrower under the Revolving Loan Agreement or this Instrument
<br />shall be applied by Lender in the order of priority as determined by Lender in its discretion.
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<br />4. CHARGES; LIENS. Borrower shall pay all taxes, assessments, premiums and Other
<br />Impositions attributable to the Real Property at Lender's option in the manner provided under Paragraph 2
<br />hereof or, if not paid in such manner due to a waiver by Lender, by Borrower making payment, when due,
<br />directly to the appropriate payee thereof, or in such other manner as Lender may designate in writing.
<br />Borrower shall promptly furnish to Lender all notices of amounts due under this paragraph and, in the
<br />event Borrower shall make payment directly, Borrower shall promptly furnish to Lender receipts
<br />evidencing such payments. Borrower shall promptly discharge any lien which has, or may have, priority
<br />over or equality with, the lien of this Instrument, and Borrower shall pay, when due, the claims of all
<br />persons supplying labor or materials to or in connection with the Real Property. Without Lender's prior
<br />written consent, which may be withheld in Lender's sole and absolute discretion (unless specifically
<br />provided to the contrary in this Instrument), Borrower will not permit or allow any lien inferior to this
<br />Instrument to be perfected against the Real Property.
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<br />5. HAZARD INSURANCE. Borrower shall keep the improvements now eXlstmg or
<br />hereafter erected on the Real Property insured by carriers at all times satisfactory to Lender against loss
<br />by fire, hazards included within the term "extended coverage" and such other hazards, casualties,
<br />liabilities and contingencies as Lender and, if this Instrument is on a leasehold, the ground lease shall
<br />require, including, among other things, flood, tornado or similar environmental damage, and in such
<br />amounts and for such periods as Lender shall require, but in any event not less than an amount which will
<br />comply with any coinsurance clause and not less than one hundred percent (100%) of the actual cash
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