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the insurance proceeds shall not be applied to the restoration of the Security within thirty days
<br />after receipt of such proceeds by Beneficiary, Beneficiary may release such proceeds to Trustor
<br />without such release being deemed a payment of any indebtedness secured hereby, rather than
<br />apply such proceeds to the restoration of the Security. Such application or release shall not cure
<br />or waive any default or notice of default hereunder or invalidate any act done pursuant to such
<br />notice. If the Security is restored at a cost less than the available insurance proceeds, then such
<br />excess proceeds shall, if Trustor is not then in default hereunder, be paid over to Trustor.
<br />Beneficiary may commence, appear in, defend or prosecute any assigned claim or action, and
<br />may adjust, compromise, settle and collect all claims, proceeds and awards assigned to
<br />Beneficiary, but shall not be responsible for any failure to collect any claim, proceeds or award,
<br />regardless of the cause of the failure.
<br />4.2. Condemnation.
<br />Promptly upon its obtaining knowledge of the institution or the threatened institution of
<br />any proceeding for the condemnation or other taking for public or quasi -public use of the
<br />Security or any part thereof, or if the same be taken or damaged by reason of any public
<br />improvement or condemnation proceeding, or in any other manner, or should Trustor receive any
<br />notice or other information regarding such proceedings, action, taking or damage, Trustor shall
<br />promptly notify Trustee and Beneficiary of such fact. Truster shall then, if requested by
<br />Beneficiary, file or defend its right thereunder and prosecute the same with due diligence to its
<br />final disposition and shall cause any award or settlement to be paid to Beneficiary in accordance
<br />with the provisions of the Loan Agreement. At Beneficiary's option, Beneficiary or Trustor may
<br />be the nominal party in such proceeding but in any event Beneficiary shall be entitled, without
<br />regard to the adequacy of its security, to participate in, appear in, prosecute and settle, jointly
<br />with Trustor to control the same and to be represented therein by counsel of its choice, and
<br />Truster will deliver, or cause to be delivered, to Beneficiary such instruments as may be
<br />requested by it from time to time to permit such participation. Truster and Beneficiary agree to
<br />act in good faith with respect to any consent, settlement, or award arising out of said prosecution.
<br />If the Security or any part thereof is taken or diminished in value, or if a consent settlement is
<br />entered, by or under threat of such proceedings, all compensation, awards, damages, rights of
<br />action proceeds and settlements payable to Truster by virtue of its interest in the security shall be
<br />and hereby are assigned, transferred and set over into Beneficiary to be held by it, in trust,
<br />subject to the lien and security interest of this Deed of Trust. All such proceeds shall be first
<br />applied to reimburse Trustee and Beneficiary, for all costs and expenses, including reasonable
<br />attorneys' fees, incurred in connection with the collection of such award or settlement, and then
<br />to the restoration of any portion of the Security that has been taken to the similar condition,
<br />character and value as existed prior to such taking so long as the following conditions are
<br />satisfied: (i) Trustor is not in default hereunder, (ii) Beneficiary's security is not materially
<br />impaired, (iii) all income (from the Security or otherwise) required to pay all debt service and
<br />operating expenses of the Security during such restoration and thereafter will be equal to or
<br />greater than the income which was required to pay such debt service and operating expenses
<br />prior to the casualty, (iv) Trustor evidences to the reasonable satisfaction of Beneficiary that the
<br />insurance required to be maintained hereunder will be available to the Truster during restoration
<br />and thereafter, (v) Beneficiary shall have approved the plans and specifications for such
<br />restoration, and (vi) in the event that in Beneficiary's reasonable judgment the insurance
<br />proceeds and any amounts deposited with a senior lender are not sufficient to accomplish
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<br />W estview House
<br />City Rental Rehabilitation Progium Deed of Trust
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