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<br /> 00263.1
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<br /> Borrower. and Lender covenant and agree as follows:
<br /> 1. PAYMENT Or PRINCIPAL AND INTEREST: Borrower shall promptly pay
<br /> when due thra principal of and interest on the indebtedness evidenced by the
<br /> Note, prepayment and late charges as provided in the Note.
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<br /> 2. FUNDS FOR TAXES AND INSURANCE: Subject to applicable law or to a
<br /> written waiver by Lender, Borrower shall pay to LerWer an the day monthly
<br /> Installments of principal and Interest are payable under the Note, until
<br /> the Note is paid in full, a sum (herein "Funds") eelual to one-twelfth of
<br /> the yearly taxes and assessments which may attain priority over this Deed
<br /> of Trust, and ground rents on the Property, if any, pies one-twelfth of
<br /> yearly premium Installments for hazard insurame, all as reasonably
<br /> estimated initially and from time to time by lender on the basis of
<br /> assessments and bills and reasonable estimates thereof.
<br /> The Fund_,, shall be held by Lender. Lender shill apply the Funds to
<br /> Pay said taxes, assessments, Insurance premiums and ground rents. The
<br /> Funds are pledged as additional security for the surns secured by this Deed
<br /> of Trust.
<br /> If the amrAint of the Funds held by Lender, together with the future
<br /> mr.nthly installments of Funds payable prior to the due dates of taxes,.
<br /> assessments, Insurance premiums and ground rents s.hali exceed the amount
<br /> required to pay said taxes, assessments, I nsuraru;e Premiums and c)rQund
<br /> rents as they fail due, such excess shall be, at Borrower's option, either
<br /> promptly repaid to Borrower or credited to Borrower on monthly installments
<br /> of Funds. If the amount of the Funds, held by Lender shall not be
<br /> sufficient to pay taxes, assessments, insurance premiums, and ground rents.
<br /> as 'they fall due, Borrower shall pay to Lender any imount necessary to make
<br /> up the deficiency within thirty (30) days from the (late notice is mealled by
<br /> Lender to Borrower requesting payment thereof.
<br /> Upon payment in full of all sums secured by this rWeed of Trust, Lender
<br /> shaiI promptly refund to Borrower any Funds held by Lender. If under
<br /> Paragraph 18 thereof the Property is sold or the Property is otherwise
<br /> acquired by Lender, Lender shall apply, no later than Immediately prior to
<br /> the sale of mhe Property or Its acqu 1 a l t i on by Lender, any Funds held by
<br /> Lender at the time of application as a credit against the sums secured by
<br /> this Deed of Trust.
<br /> 3. APPLICATION OF PAYMENTS: Unless applicable law provides
<br /> otherwise, all peym+ents received by Lender under the Note and Paragraphs 1
<br /> and 2 hereof shall be applied by Lender 1) first to interest payable on the
<br /> Nate, 2) then In payment of amounts payable to Lender by -Borrower under
<br /> Paragraph 2 hereof, and 3) then to the principal of the Note.
<br /> 4. CHAP.GESi LIENS: Borrower shall Issy all taxes, assessmemnts rand
<br /> other charges, fines and impositions attributable to the Property which may
<br /> wtt!On a priority over this Deed of Trust, and leasehold payments or ground
<br /> rents, if any, in the manner provided under Paragraph 2 hereof or, If not
<br /> paid In sv..:h manner, by Borrower mak i ray payment, v.+aen due, directly to the
<br /> payee thereof. Borrower shall promptly furnish tro. Lender all notices of
<br /> amountr, due under this paragraph, and In the event. Borrower shall maker
<br /> paymrnts directly, Borrower shall prcxrpt ly furnish to Lender receipts
<br /> evidencing such payments. Borrower shall promptly discharge any lien which
<br /> has priority over this Deed of Trusty provided, tha. Borrower shall not to
<br /> required to discharge any such lien so long as Borrower shall agree in
<br /> writing to the paymxmt of the obl lgat1w secured by such lion In a mnner
<br /> r+ccept,ahlo to Lender, or whrall In good faith contest such lion by, or
<br /> defend enforcement of such lien in, legal proceedings which operate to
<br /> prevent the enforcement of the lien or forfe 1 turr, of the Property or any
<br /> part thereof.
<br /> 5. INSVRAWE COVERAGES: Borrower shall keep the Improvements now
<br /> exia.ting or hereafter erected on the property Insured against loss by fire,
<br /> hazards Included within the term "extendod coverage", and such other
<br /> hazards as Leander my require, In the arnatxit eciur+l to the loan balance or
<br /> for not less than 80% of the full replacranent value of the improvrments,
<br /> whichever is greater, as established by a competent Insurance appraiser.
<br /> Comprehensive general public liability insurance wi l 1 also he obtained, i r,
<br /> a company acceptable to the Lander, for an amount not less tNaan 5504,000
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