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encumbrance is or would be senior or subordinate to this Deed of Trust;provided however,Trustor
<br /> will not be required to discharge the lien of the deed of trust securing the First Mortgage Note(the
<br /> "First Mortgage Deed of Trust"), and Trustor will not be required to pay any tax, charge, lien or
<br /> assessment described in this Section so long as Trustor is actively contesting its validity in good
<br /> faith and by appropriate legal proceedings that will operate to prevent the enforcement of the lien
<br /> or forfeiture of the Property or any part thereof. Trustor shall post security for the payment of such
<br /> contested claims as may be requested by the City.
<br /> 4. Protection of SecuE ty. If Trustor fails to perform any of the covenants and
<br /> agreements set forth in this Deed of Trust, or if any action or proceeding is commenced that
<br /> materially affects City's interest in the Property, including, but not limited to, default under any
<br /> senior lienholder document, eminent domain, insolvency, code enforcement, arrangements or
<br /> proceedings involving a bankrupt or decedent, foreclosure of any mortgage secured by the
<br /> Property or sale of the Property under a power of sale of any instrument secured by the Property,
<br /> City, at its option,without releasing Trustor from any obligation hereunder, may upon notice to
<br /> Trustor, make such appearance, disburse such sums and take such action as is necessary to protect,
<br /> City's interest,including,but not limited to,the purchase of insurance, disbursement of reasonable
<br /> attorneys' fees and entry upon the Property to make repairs. Any amounts disbursed by City
<br /> pursuant to this Section., with interest thereon, shall become additional indebtedness of Trustor
<br /> secured by this Deed of Trust. Unless Trustor and City agree to other terms of payment, such
<br /> amounts shall be payable upon notice from City to Trustor requesting payment thereof, and shall
<br /> bear interest from the date of disbursement at the highest rate permissible under applicable law.
<br /> Nothing contained in this Section shall require City to incur any expense or take any action
<br /> hereunder.
<br /> 5. Inspection. The City may make, or cause to be made, reasonable entries upon the
<br /> Property and inspections of the Security; provided that the City will give Trustor reasonable notice
<br /> of inspection.
<br /> 6. Title Insurance. At Trustor's expense, Trustor shall purchase a CLTA lender's
<br /> policy of title insurance for the benefit of City, insuring this Deed of Trust as a secondary lien on
<br /> the Property, with no delinquent taxes or assessment liens appearing as exceptions to title.
<br /> 7. Hazard Insurance. Trustor shall keep the Property insured by a standard all-risk
<br /> property insurance policy with endorsements for vandalism, malicious mischief, and special
<br /> extended perils, in the full replacement value of the improvements, and with endorsements for
<br /> increases in costs due to changes in code and inflation, with loss payable to City and any superior
<br /> trust deed holder, as their interests may appear, and any other insurance required by the City.
<br /> The insurance carrier providing such insurance shall be licensed to do business in the State
<br /> of California and may be chosen by Trustor, subject to approval by City. All insurance policies
<br /> and renewals thereof shall be in a form acceptable to the City, and shall include a standard
<br /> mortgagee clause with standard lender's endorsement in favor of the holder of any senior lien and
<br /> the City as their interests may appear and in a form acceptable to the City. Trustor shall provide
<br /> City with copies of all policies and renewals thereof, certificates of insurance, all renewal notices
<br /> and all receipts of paid premiums. In the event of loss, Trustor shall give prompt notice to the
<br /> insurance carrier and the City or its designated agent. The City, or its designated agent, may make
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<br /> Exhibit D
<br /> 55 394,00101\43423340.1
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