PROPERTY OR ANY PART THEREOF, OR AT ANY TIME DURING ANY WORK, OR
AT ANY TIME THAT LENDER IS HOLDING OR IS ENTITLED TO RECEIVE ANY INSURANCE
PROCEEDS PURSUANT TO THIS SECURITY INSTRUMENT, A DEFAULT EXISTS AND IS
CONTINUING (WHETHER OR NOT IT CONSTITUTES AN EVENT OF DEFAULT), LENDER SHALL
THEN HAVE NO OBLIGATION TO MAKE SUCH PROCEEDS AVAILABLE FOR WORK AND LENDER
SHALL HAVE THE RIGHT AND OPTION, TO BE EXERCISED IN ITS SOLE AND ABSOLUTE
DISCRETION AND ELECTION, WITH RESPECT TO THE INSURANCE PROCEEDS, EITHER TO
RETAIN AND APPLY SUCH PROCEEDS IN REIMBURSEMENT FOR THE ACTUAL COSTS, FEES AND
EXPENSES INCURRED BY LENDER IN ACCORDANCE WITH THE TERMS HEREOF IN CONNECTION
WITH THE ADJUSTMENT OF THE LOSS AND ANY BALANCE TOWARD PAYMENT OF THE DEBT IN
SUCH PRIORITY AND PROPORTIONS AS LENDER, IN ITS SOLE DISCRETION, SHALL DEEM
PROPER, OR TOWARDS THE WORK, UPON SUCH TERMS AND CONDITIONS AS LENDER SHALL
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DETERMINE, OR TO CURE AN EVENT OF DEFAULT, OR TO ANY ONE OR MORE OF THE
FOREGOING AS LENDER, IN ITS SOLE AND ABSOLUTE DISCRETION, MAY DETERMINE.
IF
LENDER SHALL RECEIVE AND RETAIN SUCH INSURANCE PROCEEDS, THE LIEN OF THIS
SECURITY INSTRUMENT SHALL BE REDUCED ONLY BY THE AMOUNT THEREOF RECEIVED, AFTER
REIMBURSEMENT TO LENDER OF EXPENSES OF COLLECTION, AND ACTUALLY APPLIED BY
LENDER IN REDUCTION OF THE PRINCIPAL SUM PAYABLE UNDER THE NOTE IN ACCORDANCE
WITH THE NOTE.
SECTION 3.07.
APPLICATION OF PROCEEDS TO DEBT REDUCTION.
(A) NO DAMAGE TO THE
PROPERTY, OR ANY PART THEREOF, BY FIRE OR OTHER CASUALTY WHATSOEVER, WHETHER
SUCH DAMAGE BE PARTIAL OR TOTAL, SHALL RELIEVE BORROWER FROM ITS LIABILITY TO
PAY IN FULL THE DEBT AND TO PERFORM ITS OBLIGATIONS UNDER THIS SECURITY
INSTRUMENT AND THE OTHER LOAN DOCUMENTS.
(B)
IF ANY INSURANCE PROCEEDS ARE APPLIED TO REDUCE THE DEBT, LENDER
SHALL APPLY THE SAME IN ACCORDANCE WITH THE PROVISIONS OF THE NOTE.
ARTICLE IV:
IMPOSITIONS
SECTION 4.01.
PAYMENT OF IMPOSITIONS, UTILITIES AND TAXES, ETC.
(A) BORROWER
SHALL PAY OR CAUSE TO BE PAID ALL IMPOSITIONS AND REMIT OR CAUSE TO BE REMITTED
ALL SAOT EXPENDITURES AT LEAST FIVE (5) DAYS PRIOR TO THE DATE UPON WHICH ANY
FINE, PENALTY, INTEREST OR COST FOR NONPAYMENT IS IMPOSED, AND FURNISH TO
LENDER, UPON REQUEST, RECEIPTED BILLS OF THE APPROPRIATE TAXING AUTHORITY OR
OTHER DOCUMENTATION REASONABLY SATISFACTORY TO LENDER EVIDENCING THE PAYMENT
THEREOF.
IF BORROWER SHALL FAIL TO PAY ANY IMPOSITION OR REMIT ANY SAOT
EXPENDITURES IN ACCORDANCE WITH THIS SECTION AND IS NOT CONTESTING OR CAUSING A
CONTESTING OF SUCH IMPOSITION IN ACCORDANCE WITH SECTION 4.04 HEREOF, OR IF
THERE ARE INSUFFICIENT FUNDS IN THE BASIC CARRYING COSTS ESCROW ACCOUNT TO PAY
ANY IMPOSITION, LENDER SHALL HAVE THE RIGHT, BUT SHALL NOT BE OBLIGATED, TO PAY
THAT IMPOSITION OR REMIT THAT SAOT EXPENDITURE, AS APPLICABLE, AND BORROWER
SHALL REPAY TO LENDER, ON DEMAND, ANY AMOUNT PAID BY LENDER, WITH INTEREST
THEREON AT THE DEFAULT RATE FROM THE DATE OF THE ADVANCE THEREOF TO THE DATE OF
REPAYMENT, AND SUCH