"COMMON ELEMENTS" SHALL
MEAN THE COMMON ELEMENT OF THE CONDOMINIUM AS DEFINED IN THE DECLARATION OF
CONDOMINIUM, THE WORDS "CONDOMINIUM BOARD" SHALL MEAN THE ORGANIZATION MANAGING
THE CONDOMINIUM, BY VIRTUE OF THE CONDOMINIUM ACT, THE DECLARATION OF
CONDOMINIUM AND THE BY-LAWS, ON BEHALF OF ALL OF THE OWNERS OF THE UNITS
COMPRISING THE CONDOMINIUM, THE TERM "CONDOMINIUM DOCUMENTS" SHALL MEAN,
COLLECTIVELY, THE "DECLARATION OF CONDOMINIUM", "BY-LAWS", "RULES AND
REGULATIONS" AND THE RULES, REGULATIONS, RESOLUTIONS AND DECISIONS ADOPTED
PURSUANT THERETO, EACH AS AMENDED, AND
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THE WORD "CONDOMINIUM" SHALL MEAN ANY CONDOMINIUM WHICH INCLUDES THE PROPERTY AS
A PART THEREOF, WHICH WAS CREATED PURSUANT TO THE CONDOMINIUM ACT.
SECTION 3.03.
ASSIGNMENT OF POLICIES.
(A) BORROWER HEREBY ASSIGNS TO LENDER
THE PROCEEDS OF ALL INSURANCE (OTHER THAN WORKER'S COMPENSATION AND LIABILITY
INSURANCE) OBTAINED PURSUANT TO THIS SECURITY INSTRUMENT, ALL OF WHICH PROCEEDS
SHALL BE PAYABLE TO LENDER AS COLLATERAL AND FURTHER SECURITY FOR THE PAYMENT OF
THE DEBT AND THE PERFORMANCE OF BORROWER'S OBLIGATIONS HEREUNDER AND UNDER THE
OTHER LOAN DOCUMENTS, AND BORROWER HEREBY AUTHORIZES AND DIRECTS THE ISSUER OF
ANY SUCH INSURANCE TO MAKE PAYMENT OF SUCH PROCEEDS DIRECTLY TO LENDER.
EXCEPT
AS OTHERWISE EXPRESSLY PROVIDED IN SECTION 3.04 OR ELSEWHERE IN THIS ARTICLE
III, LENDER SHALL HAVE THE OPTION, IN ITS DISCRETION, AND WITHOUT REGARD TO THE
ADEQUACY OF ITS SECURITY, TO APPLY ALL OR ANY PART OF THE PROCEEDS IT MAY
RECEIVE PURSUANT TO THIS ARTICLE IN SUCH MANNER AS LENDER MAY ELECT TO ANY ONE
OR MORE OF THE FOLLOWING:
(I) THE PAYMENT OF THE DEBT, WHETHER OR NOT THEN DUE,
IN ACCORDANCE WITH THE PROVISIONS OF THE NOTE, (II) THE REPAIR OR RESTORATION OF
THE PROPERTY, (III) THE CURE OF ANY DEFAULT OR (IV) THE REIMBURSEMENT OF THE
COSTS AND EXPENSES OF LENDER INCURRED PURSUANT TO THE TERMS HEREOF IN CONNECTION
WITH THE RECOVERY OF THE INSURANCE PROCEEDS.
SUBJECT TO SECTION 15.03(A),
NOTHING HEREIN CONTAINED SHALL BE DEEMED TO EXCUSE BORROWER FROM REPAIRING OR
MAINTAINING THE PROPERTY AS PROVIDED IN THIS SECURITY INSTRUMENT OR RESTORING
ALL DAMAGE OR DESTRUCTION TO THE PROPERTY, REGARDLESS OF THE SUFFICIENCY OF THE
INSURANCE PROCEEDS, AND THE APPLICATION OR RELEASE BY LENDER OF ANY INSURANCE
PROCEEDS SHALL NOT CURE OR WAIVE ANY DEFAULT OR NOTICE OF DEFAULT.
(B)
IN THE EVENT OF THE FORECLOSURE OF THIS SECURITY INSTRUMENT OR ANY
OTHER TRANSFER OF TITLE OR ASSIGNMENT OF ALL OR ANY PART OF THE PROPERTY IN
EXTINGUISHMENT, IN WHOLE OR IN PART, OF THE DEBT, ALL RIGHT, TITLE AND INTEREST
OF BORROWER IN AND TO ALL POLICIES OF INSURANCE REQUIRED BY THIS SECURITY
INSTRUMENT SHALL INURE TO THE BENEFIT OF THE SUCCESSOR IN INTEREST TO BORROWER
OR THE PURCHASER OF THE PROPERTY (IT BEING ACKNOWLEDGED THAT THE POLICY REQUIRED
PURSUANT TO SECTION 3.01(A)(II) HEREOF SHALL NOT BE REQUIRED TO BE ASSIGNED TO
LENDER).
IF, PRIOR TO THE RECEIPT BY LENDER OF ANY PROCEEDS, THE PROPERTY OR
ANY PORTION THEREOF SHALL HAVE BEEN SOLD ON FORECLOSURE OF THIS SECURITY
INSTRUMENT OR BY DEED