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Grantor shall deliver or cause to be delivered to Beneficiary such instruments as may be requested by Beneficiary from
<br /> time to time to permit Beneficiary to take any such actions.
<br /> 6.6.4 Application of Proceeds. All proceeds of the Claims that Grantor may
<br /> receive or be entitled to receive shall be paid to Beneficiary. Beneficiary shall apply any proceeds received by it
<br /> hereunder first to the payment of the reasonable costs and expenses incurred in the collection of the proceeds.
<br /> Beneficiary shall then apply the remaining balance of such proceeds (the "Net Claims Proceeds"), in its absolute
<br /> discretion and without regard to the adequacy of its security: (i)to the Secured Obligation, notwithstanding the fact that
<br /> the Secured Obligation may not be due according to the terms thereof; (ii)to reimburse Grantor for the costs of
<br /> reconstructing the Improvements or otherwise repairing or restoring the Collateral; or (iii)to Grantor; provided,
<br /> however, that if there are no outstanding Events of Default under the Development Agreement or Amendment and
<br /> Grantor establishes, to Beneficiary's reasonable satisfaction,that Grantor has sufficient funds, including the Net Claims
<br /> Proceeds, to fully rebuild or repair the Collateral within the remaining term of the Loan and without delaying the
<br /> completion date of the Project, Beneficiary shall make disbursements of the Net Claims Proceeds for purposes of
<br /> repair or restoration of the Collateral.
<br /> 6.6.5 Restoration. If the Net Claims Proceeds are used to reimburse Grantor for the
<br /> cost of reconstruction, restoration, or repair of the Collateral, the Collateral shall be promptly and diligently restored by
<br /> Grantor to the equivalent of its condition immediately prior to the casualty or condemnation in accordance with the
<br /> Plans or to such other condition as Beneficiary may approve in writing, and disbursements of such Net Claims
<br /> Proceeds shall be in accordance with disbursement procedures acceptable to Beneficiary. If, after applying the Net
<br /> Claims Proceeds to the Secured Obligation, Beneficiary reasonably determines the remaining security to be
<br /> inadequate to secure the remaining amount due under the Secured Obligation, Grantor shall, upon written demand
<br /> from Beneficiary, repay an amount that will reduce the remaining Secured Obligation to a balance for which adequate
<br /> security is present.
<br /> 6.7 Reserves for Taxes and Insurance. If required by Beneficiary after an Event of Default
<br /> has occurred, Grantor shall deposit with Beneficiary, in monthly installments, an amount equal to one-twelfth of the
<br /> estimated aggregate annual Impositions and insurance premiums for the Project. In such event, Grantor shall cause
<br /> all bills, statements, or other documents relating to the Impositions and insurance premiums to be sent or mailed
<br /> directly to Beneficiary. Upon receipt of such bills,statements,or other documents,and provided Grantor has deposited
<br /> sufficient funds with Beneficiary pursuant to this Section, Beneficiary shall pay such amounts as may be due
<br /> thereunder out of the funds so deposited with Beneficiary. If at any time and for any reason the funds deposited with
<br /> Beneficiary are or will be insufficient to pay such amounts as may then or subsequently be due, Beneficiary shall notify
<br /> Grantor and Grantor shall immediately deposit an amount equal to such deficiency with Beneficiary. Notwithstanding
<br /> the foregoing, nothing contained herein shall cause Beneficiary to be deemed a trustee of said funds or to be obligated
<br /> to pay any amounts in excess of the amount of funds deposited with Beneficiary pursuant to this Section. Beneficiary
<br /> may commingle said reserve with its own funds and Grantor shall be entitled to no interest thereon.
<br /> 6.8 Maintenance and Preservation of the Collateral. Grantor covenants: (i)to maintain
<br /> and preserve the Collateral in good condition and repair and in a prudent businesslike manner; (ii)not to remove,
<br /> demolish or structurally alter the Collateral or any part thereof, or alter, restore or add to the Collateral, or initiate or
<br /> allow any change in any zoning or other land use classification that affects the Collateral or any part of it, except with
<br /> Beneficiary's express prior written consent, and except such alterations as may be required by laws,ordinances, rules,
<br /> regulations, or orders of governmental authorities or by the terms hereof; (iii)to comply with and not suffer violations of
<br /> any existing and future subdivision laws, building codes, zoning laws and regulations, and other laws, regulations,
<br /> ordinances, rules, codes, orders, directives, guidelines, building restrictions and requirements of, and all agreements
<br /> with and commitments to, all federal, state, county or municipal governmental,judicial or legal authorities or agencies
<br /> having jurisdiction over the Grantor or the Project, including those pertaining to the construction, sale, lease, or
<br /> financing of the Improvements, and all recorded covenants and restrictions affecting the Project(the"Requirements");
<br /> (iv)not to commit or permit any waste to or deterioration of the Collateral; (v)to perform all other acts that from the
<br /> Everett Deed of Trust—Lot 1 Page 9
<br /> ND:19652.017 4822-1832-5829v1
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