THIRD PARTY OPEN-END MORTGAGE, SECURITY AGREEMENT AND ASSIGNMENT OF RENTS, PROFITS, INCOME AND LEASES IN THE MAXIMUM AMOUNT OF $3,250,000.00

KNOW ALL MEN BY THESE PRESENTS:

WHEREAS, the undersigned LEE’S FOOD MART’S, LLC, a Tennessee limited liability company (“Mortgagor”) is the fee owner of the real property described on Exhibit A attached hereto and incorporated herein by reference;

WHEREAS, HEARTLAND, INC., a Nevada corporation, whose address is 1005 North 19th Street, Middlesboro, Kentucky 40965 (hereinafter referred to as “Borrower”) has executed and delivered to CHOICE FINANCIAL GROUP, a North Dakota state bank, whose address for purposes hereof is 1697 South 42 ^nd Street, Grand Forks, North Dakota 58201 (hereinafter referred to as “Mortgagee” or “Lender”) that certain Promissory Note of even date herewith in the original principal sum of Three Million Two Hundred Fifty Thousand and 00/100 Dollars ($3,250,000.00) (the “Note”), payable in accordance with the terms of said Note; the entire unpaid balance of principal and interest being due and payable on or before, _________________________________________________________

___________________________________________________________________________________________ 2011, or such earlier date as is set forth in the Note. The indebtedness evidenced by the Note and/or secured hereby is herein called the “Loan.” The Note, this Third Party Open-End Mortgage, Security Agreement and Assignment of Rents, Profits, Income and Leases (this “Mortgage”), any and all guarantees executed in connection with the Note and/or the obligations evidenced thereby, a certain Loan Agreement bearing even date herewith executed by Mortgagor and Mortgagee (the “Loan Agreement”) and any and all other agreements, certificates, affidavits and documents now or hereafter executed in connection with the Note and/or the obligations evidenced thereby are collectively hereinafter referred to as the “Loan Documents”; and

WHEREAS, this Mortgage is given to secure to Mortgagee (a) the repayment of the indebtedness evidenced by the Note, with interest thereon, and all renewals, extensions and modifications thereof and any late charges imposed upon Mortgagor; (b) the repayment of future advances disbursed by Mortgagee to Mortgagor in excess of the principal of the indebtedness; (c) the payment of all other sums, with interest thereon, advanced in accordance with the terms of this Mortgage or any other Loan Document; (d) the performance of all obligations, covenants and agreements herein contained and/or contained in the Loan Documents, in accordance with the terms thereof; and (e) the payment and/or performance of any and all other obligations of Mortgagor to Mortgagee whether now existing or hereafter arising.

For good and valuable consideration to it paid by Mortgagee, the receipt and sufficiency of which are hereby acknowledged, Mortgagor does hereby MORTGAGE, GRANT, BARGAIN, SELL, TRANSFER, ASSIGN AND CONVEY unto Mortgagee, its successors and assigns, that certain real estate situated in the County of ______________________________ and State of Kentucky, and more

TOGETHER WITH all and singular the tenements, hereditaments and appurtenances thereto belonging, all present and future buildings, structures, annexations, access rights, rights of way or use, servitudes, licenses, and improvements thereon, all of the rights, privileges, licenses, easements and appurtenances belonging to such real estate, together with all of Mortgagor’s estate and right, if any, in and to lands lying in streets, alleys and roads adjoining the said real estate and all of Mortgagor’s right, title, interest, estate, claim and demand, either at law or in equity, in and to all chattels, fixtures, building materials, machinery, inventory, apparatus, equipment, articles and/or other personal property now or hereafter located on or used or useable in connection with said real estate or any business conducted thereon, whether or not the same have or would have become a part of said real estate by attachment thereto, including, without limiting the generality of the foregoing, all lighting, heating, cooling, ventilating, air-conditioning, power, incinerating, sprinkling, gas, plumbing, waste removal and refrigeration systems, engines, furnaces, boilers, pumps, tanks, heaters, generators, motors, maintenance equipment, fire prevention apparatus, dryers and laundry equipment, office equipment; and all pipes, wires, fixtures and apparatus forming a part of or used in connection therewith; elevators and motors; refrigeration plants or units; kitchen equipment; cooking appliances; cabinets; partitions; doors; windows; furniture; furnishings; living and artificial plants and planters; televisions; beds; dressers; radios; lamps; switchboards; telephones; telephone systems and equipment; computers; computer equipment and software; cabinets; signage; storm windows and doors; window and door screens; awnings and window and door shades; all drapes and curtains and related hardware and mounting devices; wall-to-wall carpeting; tables; chairs; pots, pans, plates, dishes, silver and flatware; linens; vending machines; all equipment, machinery, furnishings, fixtures and inventory situated upon or in the real estate and/or used or usable in the operation thereof as well as all additions, improvements, substitutions and replacements thereto, and proceeds thereof; with respect to any personal property which is subject to a conditional bill of sale, lease, security agreement, mortgage or other lien covering such property, all the right, title and interest of the Mortgagor in and to any and all such personal property and any and all such conditional bills of sale and/or leases, together with the benefits of any deposits or payments now or hereafter made by the Mortgagor, or the predecessors or successors in title to the Mortgagor; all of the records and books of account now or hereafter maintained by Mortgagor in connection with the real estate and/or the construction, development, operation and/or management thereof and/or in connection with the operation of Mortgagor’s business; all names as may be used in connection with the real estate and goodwill associated therewith; all rents, issues, profits and other incomes whether now existing or hereafter acquired; all proceeds or sums payable in lieu of or as compensation for the loss of or damage to any property covered hereby, or to the real estate upon which the said property covered hereby is or may be located including without limitation all buildings and improvements now or hereafter located thereon, and all rights in and to all present and future fire, hazard, builder’s risk, business interruption, rental interruption, flood and other insurance policies required to be maintained by Mortgagor; all awards made by any public body or decreed by any court of competent jurisdiction for the taking or for degradation of value in any eminent domain proceedings, or purchase in lieu thereof; all of Mortgagor’s interest and rights as lessor in and to all leases now or hereafter affecting the said real estate or any part thereof; all contract rights relating to the purchase and maintenance of any equipment and/or construction of any improvements (including, without limitation, any contracts with architects, engineers and/or contractors); all accounts and general intangibles now owned or existing or hereafter created or acquired; all plans, specifications, drawings, studies, surveys, appraisals and other similar work product related to the real estate; all agreements for the provision of property or services to or in connection with, or otherwise benefiting, the real estate, including, without limitation, all management agreements, license agreements, franchise agreements and cable television agreements; to the extent permitted by applicable law, all rights in and to any building, zoning, environmental and other permits, licenses, approvals, variances and consents which have been issued or are hereafter issued by any governmental entity and/or utility company in connection with or related to the real estate; and all bonds securing to Mortgagor the payment or performance of any obligation concerning the construction, maintenance, repair and/or use of the real estate; and all proceeds, products, offspring, rents and profits from any of the foregoing; all of which, together with said real estate, buildings and improvements, tenements, hereditaments and appurtenances and all proceeds, products, offspring, rents and profits from any of the foregoing, are hereinafter referred to as the “Property” or the “premises.”

2.1 Assignment. Mortgagor hereby absolutely and unconditionally assigns and transfers to Lender the following and all proceeds, profits and offspring therefrom (collectively, the “Assigned Interest”):

2.2 Affirmative Covenants and Representations. Mortgagor will (i) observe and perform all covenants and conditions to be observed or performed by Mortgagor under the Leases; (ii) at the sole cost and expense of Mortgagor, enforce, short of termination of any Lease, the observance and performance of every covenant and condition of the Leases to be observed

and performed by the Lessees and enforce all guarantees given in connection with any of the Leases; and (iii) appear in, settle and defend any legal action growing out of, or in any manner connected with, the Leases or the obligations or liabilities of Mortgagor as lessor thereunder, or of any of the Lessees or guarantors. MORTGAGOR WARRANTS THAT: NO LABOR OR WORK HAS BEEN PERFORMED AS TO THE PROPERTY WHICH HAS NOT BEEN PAID IN FULL, NO MATERIALS HAVE BEEN FURNISHED AS TO THE PROPERTY WHICH HAVE NOT BEEN PAID IN FULL, NO LABOR OR WORK WILL BE PERFORMED AS TO THE PROPERTY PRIOR TO THE FILING OF RECORD OF THIS MORTGAGE AND NO MATERIALS WILL BE FURNISHED AS TO THE PROPERTY PRIOR TO THE FILING FOR RECORD OF THIS MORTGAGE. Mortgagor warrants that there are no Leases or other agreements in existence which grant any right of occupancy with respect to any portion of the Property. Mortgagor warrants that: its sole executive (principal) place of business is located as follows: 1005 North 19 ^th Street, Middlesboro, Kentucky 40965; it shall not change (or attempt to change) its executive (principal) office or add another place of business without Mortgagee’s prior written approval; its legal name is a first above written; and it shall not change (or attempt to change) said name without Mortgagee’s prior written approval.

4.1 Uniform Commercial Code. In addition to being a mortgage, this Mortgage is intended to be a security agreement pursuant to the Uniform Commercial Code for any of the items specified herein as part of the “Property” and for any of the items listed on Exhibit B, attached hereto and incorporated by reference herein, which under applicable law may be subject to a security interest pursuant to the Uniform Commercial Code, and Mortgagor hereby grants Mortgagee a security interest in said items, and all substitutions, replacements, replacement parts, additions, repairs, repair parts, accessions and accessories incorporated therein or affixed thereto in which Mortgagor acquires an interest, and the proceeds thereof (sometimes referred to herein collectively as the “Collateral”). The “Collateral” shall be included in the “Property.” Mortgagor agrees that Mortgagee may file this Mortgage, or a reproduction thereof, in the real estate records or other appropriate index, as a financing statement for any of the items specified above as part of the Property. Any reproduction of this Mortgage or of any other security agreement or financing statement shall be sufficient as a financing statement. In addition, Mortgagor hereby irrevocably authorizes Mortgagee to file any financing statements, as well as extensions, renewals and amendments thereof, and reproductions of this Mortgage in such form as Mortgagee determines in its sole discretion, to perfect or protect the security interest hereby created with respect to the Collateral, or to more fully describe the Collateral. Mortgagor shall pay all costs of and expenses (including reasonable expenses of counsel and filing fees) relative to the preparation and filing of any financing statements and any extensions, renewals, amendments and releases thereof, and shall pay all reasonable costs and expenses of any record searches for financing statements Mortgagee may reasonably require.

225 South Sixth Street, Suite 3500 Minneapolis, Minnesota 55402

(A)   ALL LEASES AND/OR SUBLEASES NOW EXISTING OR HEREAFTER MADE (THE “LEASES”) OF ALL OR ANY PART OF THE PROPERTY DESCRIBED IN EXHIBIT A ATTACHED TO THIS MORTGAGE AND INCORPORATED BY REFERENCE HEREIN, AND ANY BUILDINGS, STRUCTURES OR IMPROVEMENTS NOW OR HEREAFTER LOCATED THEREON (THE “PROPERTY”), AS SUCH LEASES ARE NOW OR MAY HEREAFTER BE MODIFIED OR EXTENDED;

(B)   ALL RENTS, INCOME AND PROFITS DUE OR TO BECOME DUE UNDER THE LEASES (INCLUDING ALL PROCEEDS UNDER ANY OPTIONS CONTAINED IN THE LEASES) AND ALL COVENANTS CONTAINED IN THE LEASES RELATING TO THE COLLECTION AND ENFORCEMENT OF COLLECTION OF SUCH RENTS, INCOME OR PROFITS;

(C)   ALL GUARANTEES OF THE OBLIGATIONS OF THE LESSEES UNDER ANY OF THE LEASES;

(D)   ANY AND ALL SECURITY DEPOSITS OR OTHER SECURITY WITH RESPECT TO THE PROPERTY OR ANY PORTION THEREOF;

(E) ALL CHATTELS, FIXTURES, BUILDING MATERIALS, MACHINERY, INVENTORY, APPARATUS, EQUIPMENT, ARTICLES AND/OR OTHER PERSONAL PROPERTY NOW OR HEREAFTER LOCATED ON OR USED OR USABLE IN CONNECTION WITH THE PROPERTY OR ANY BUSINESS CONDUCTED THEREON, WHETHER OR NOT THE SAME HAVE OR WOULD BECOME A PART OF THE PROPERTY BY ATTACHMENT THERETO, INCLUDING, WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, ALL LIGHTING, HEATING, COOLING, VENTILATING, AIR CONDITIONING, POWER, INCINERATING, SPRINKLING, GAS, PLUMBING, WASTE REMOVAL AND REFRIGERATION SYSTEMS, ENGINES, FURNACES, BOILERS, PUMPS, TANKS, HEATERS, GENERATORS, MOTORS, MAINTENANCE EQUIPMENT, FIRE PREVENTION APPARATUS, DRYERS AND LAUNDRY EQUIPMENT, OFFICE EQUIPMENT; AND ALL PIPES, WIRES, FIXTURES AND APPARATUS FORMING A PART OF OR USED IN CONNECTION THEREWITH; ELEVATORS AND MOTORS; REFRIGERATION PLANTS OR UNITS; KITCHEN EQUIPMENT; COOKING APPLIANCES; CABINETS; PARTITIONS; DOORS; WINDOWS; FURNITURE; FURNISHINGS; LIVING AND ARTIFICIAL PLANTS AND PLANTERS; TELEVISIONS; TELEVISION SYSTEMS; ANTENNA AND/OR SATELLITE DISH SYSTEMS; BEDS; DRESSERS; RADIOS; LAMPS; SWITCHBOARDS; TELEPHONES; TELEPHONE SYSTEMS AND EQUIPMENT; COMPUTERS, COMPUTER EQUIPMENT AND SOFTWARE; CABINETS; SIGNAGE; STORM WINDOWS AND DOORS; WINDOW AND DOOR SCREENS; AWNINGS AND WINDOW AND DOOR SHADES; ALL DRAPES

AND CURTAINS AND RELATED HARDWARE AND MOUNTING DEVICES; WALL-TO-WALL CARPETING; TABLES; CHAIRS; POTS, PANS, PLATES, DISHES, SILVER AND FLATWARE; LINENS; VENDING MACHINES; ALL EQUIPMENT, MACHINERY, FURNISHINGS, FIXTURES AND INVENTORY SITUATED UPON OR IN THE PROPERTY AND USED OR USABLE IN THE OPERATION THEREOF; AS WELL AS ALL ADDITIONS, IMPROVEMENTS, SUBSTITUTIONS AND REPLACEMENTS THERETO, AND PROCEEDS THEREOF; WITH RESPECT TO ANY PERSONAL PROPERTY WHICH IS SUBJECT TO A CONDITIONAL BILL OF SALE, LEASE, SECURITY AGREEMENT, MORTGAGE OR OTHER LIEN COVERING SUCH PROPERTY, ALL THE RIGHT, TITLE AND INTERESTS OF MORTGAGOR IN AND TO ANY AND ALL SUCH PERSONAL PROPERTY AND ANY AND ALL SUCH CONDITIONAL BILLS OF SALE AND/OR LEASES, TOGETHER WITH THE BENEFITS OF ANY DEPOSITS OR PAYMENTS NOW OR HEREAFTER MADE BY MORTGAGOR, OR THE PREDECESSORS OR SUCCESSORS IN TITLE TO MORTGAGOR; ALL OF THE RECORDS AND BOOKS OF ACCOUNT NOW OR HEREAFTER MAINTAINED BY MORTGAGOR IN CONNECTION WITH THE PROPERTY AND/OR THE CONSTRUCTION, DEVELOPMENT, OPERATION AND/OR MANAGEMENT THEREOF AND/OR IN CONNECTION WITH THE OPERATION OF MORTGAGOR’S BUSINESS; ALL NAMES AS MAY BE USED IN CONNECTION WITH THE PROPERTY AND THE GOODWILL ASSOCIATED THEREWITH; ALL RENTS, ISSUES, PROFITS AND OTHER INCOMES WHETHER NOW EXISTING OR HEREAFTER ACQUIRED; ALL PROCEEDS OR SUMS PAYABLE IN LIEU OF OR AS COMPENSATION FOR THE LOSS OF OR DAMAGE TO ANY PROPERTY COVERED HEREBY, OR TO THE PROPERTY, INCLUDING, WITHOUT LIMITATION, ALL BUILDINGS AND IMPROVEMENTS NOW OR HEREAFTER LOCATED THEREON, AND ALL RIGHTS IN AND TO ALL PRESENT AND FUTURE FIRE, HAZARD, BUILDER’S RISK, BUSINESS INTERRUPTION, RENTAL INTERRUPTION, FLOOD AND OTHER INSURANCE POLICIES REQUIRED TO BE MAINTAINED BY MORTGAGOR; ALL AWARDS MADE BY ANY PUBLIC BODY OR DECREED BY ANY COURT OF COMPETENT JURISDICTION FOR THE TAKING OR FOR DEGRADATION OF VALUE IN ANY EMINENT DOMAIN PROCEEDINGS, OR PURCHASE IN LIEU THEREOF; ALL OF MORTGAGOR’S INTEREST AND RIGHTS AS LESSOR IN AND TO ALL LEASES NOW OR HEREAFTER AFFECTING THE PROPERTY OR ANY PART THEREOF; ALL CONTRACT RIGHTS RELATING TO THE PURCHASE, INSTALLATION AND/OR MAINTENANCE OF ANY EQUIPMENT AND/OR CONSTRUCTION OF ANY IMPROVEMENTS (INCLUDING WITHOUT LIMITATION, ANY CONTRACTS WITH ARCHITECTS, ENGINEERS AND/OR CONTRACTORS); ALL ACCOUNTS AND GENERAL INTANGIBLES NOW OWNED OR EXISTING OR HEREAFTER CREATED OR ACQUIRED RELATED TO THE PROPERTY AND/OR THE OPERATION OF ANY BUSINESS WITH RESPECT THERETO; ALL PLANS, SPECIFICATIONS, DRAWINGS, STUDIES, SURVEYS, APPRAISALS AND OTHER SIMILAR WORK PRODUCT RELATED TO THE PROPERTY; ALL AGREEMENTS FOR THE PROVISION OF PROPERTY OR SERVICES TO OR IN CONNECTION WITH, OR OTHERWISE BENEFITING, THE PROPERTY, INCLUDING, WITHOUT LIMITATION, ALL MANAGEMENT AGREEMENTS, FRANCHISE AGREEMENTS, LICENSE AGREEMENTS AND CABLE TELEVISION AGREEMENTS; TO THE EXTENT PERMITTED BY APPLICABLE LAW, ALL RIGHTS IN AND TO ANY AND ALL BUILDING, ZONING, ENVIRONMENTAL AND OTHER PERMITS, LICENSES, APPROVALS, VARIANCES AND CONSENTS WHICH HAVE BEEN ISSUED OR ARE HEREAFTER ISSUED BY ANY GOVERNMENTAL ENTITY AND/OR UTILITY COMPANY OR PROVIDED IN CONNECTION WITH OR RELATED TO THE PROPERTY; AND ALL BONDS SECURING TO MORTGAGOR THE PAYMENT OR PERFORMANCE OF ANY OBLIGATION CONCERNING THE CONSTRUCTION, MAINTENANCE, REPAIR AND/OR USE OF THE PROPERTY;

(F)   ALL DRAWINGS, PLANS, SPECIFICATIONS, SHOP DRAWINGS, RENDERINGS, DATA, STUDIES, REPORTS, APPRAISALS AND ANALYSIS NOW EXISTING OR HEREAFTER PREPARED BY MORTGAGOR, ITS AGENTS, CONTRACTORS, ARCHITECTS, ENGINEERS AND/OR EMPLOYEES IN CONNECTION WITH OR RELATED TO THE PROPERTY; AND

(G)   ALL RIGHTS IN, TO AND UNDER, ALL MONIES DUE AND TO BECOME DUE PURSUANT TO AND ALL CLAIMS, DEMANDS AND CAUSES OF ACTION THAT MORTGAGOR NOW HAS OR WHICH MAY HEREAFTER ARISE AGAINST ALL PARTIES UNDER ALL CONTRACTS AND SUBCONTRACTS RELATED TO OR PROVIDING FOR THE DESIGN AND CONSTRUCTION OF IMPROVEMENTS TO THE PROPERTY OR THE PROVISION OF LABOR, SERVICES OR MATERIALS THEREFOR, WHETHER NOW EXISTING OR HEREAFTER EXECUTED, AND ANY SUPPLEMENTS THERETO.

2.1 PAYMENTS. IF NOT TIMELY PAID BY BORROWER, TO PAY (WITHOUT CONDITION, RESTRICTION OR SET-OFF AND IN IMMEDIATELY-AVAILABLE MONEY OF THE UNITED STATES OF AMERICA) THE PRINCIPAL OF THE NOTE, INTEREST THEREON AND ANY AND ALL LATE CHARGES AND PENALTIES, AND THE PRINCIPAL OF ALL OTHER NOTES SECURED HEREBY TOGETHER WITH INTEREST THEREON AT THE TIMES AND IN THE MANNER HEREIN PROVIDED, AND IF NOT TIMELY PAID BY BORROWER, TO PAY ALL OTHER INDEBTEDNESS HEREBY SECURED AT THE TIMES AND IN THE MANNER HEREIN PROVIDED, INCLUDING ANY ADVANCES OR EXPENSES OF ANY KIND INCURRED BY MORTGAGEE PURSUANT TO THE PROVISIONS OF THE NOTE, ANY OTHER NOTES SECURED HEREBY, THIS MORTGAGE, OR ANY OF THE OTHER LOAN DOCUMENTS.

2.2 CONDITION OF PROPERTY; COMPLIANCE WITH LAWS; WASTE; USES. TO KEEP THE PROPERTY IN GOOD CONDITION AND REPAIR AND TO MAKE ALL STRUCTURAL AND NONSTRUCTURAL AND ALL ORDINARY AND EXTRAORDINARY REPAIRS AND MAINTENANCE AS AND WHEN THE SAME BECOME NECESSARY, AND TO CAUSE ALL REPAIRS AND MAINTENANCE TO BE DONE IN A GOOD AND WORKMANLIKE MANNER; TO REPAIR, REPLACE, REBUILD AND RECONSTRUCT ANY AND ALL PORTIONS OF THE PROPERTY WHICH MAY BE DAMAGED OR DESTROYED BY FIRE, WINDSTORM OR ANY OTHER CASUALTY; TO REPAIR, REPLACE, REBUILD AND RECONSTRUCT ANY PORTIONS OF THE PROPERTY WHICH MAY BE LOST, ALTERED, DAMAGED OR DESTROYED AS THE RESULT OF A “TAKING” (HEREIN DEFINED); TO COMPLY IN ALL RESPECTS WITH ALL PRESENT AND FUTURE STATUTES, LAWS, ORDINANCES, AND GOVERNMENTAL RULES, REGULATIONS AND ORDERS WHICH ARE APPLICABLE TO ALL OR ANY PORTION OF THE MORTGAGOR’S BUSINESS OR PROPERTIES; TO PERFORM OR CAUSE TO BE PERFORMED ANY AND ALL ENVIRONMENTAL STUDIES, AUDITS, AND TESTS AS MAY BE REQUIRED BY APPLICABLE LAW OR BY MORTGAGEE; NOT TO COMMIT OR PERMIT WASTE OF THE PROPERTY, OR REMOVE OR PERMIT THE REMOVAL OF ANY BUILDING, IMPROVEMENT OR FIXTURE FROM THE PROPERTY; NOT TO PERFORM OR PERMIT ANY ACT WHICH MAY IN ANY WAY IMPAIR THE VALUE OF THE PROPERTY, OR ALLOW CHANGES IN THE USE FOR WHICH THE PROPERTY WAS INTENDED AT THE TIME THIS MORTGAGE WAS EXECUTED; NOT TO REMOVE OR DEMOLISH, OR PERMIT OTHERS TO REMOVE OR DEMOLISH, ANY IMPROVEMENTS OR PORTIONS OF THE PROPERTY OR, SUBJECT TO THE PROVISIONS OF THIS SECTION 2.2, CAUSE OR PERMIT SUCH IMPROVEMENTS TO BE MATERIALLY ALTERED OR CHANGED WITHOUT THE PRIOR WRITTEN CONSENT OF MORTGAGEE, AS WELL AS MORTGAGEE’S PRIOR WRITTEN CONSENT TO THE PLANS AND SPECIFICATIONS RELATING THERETO.

AND SEWER CHARGES, AND ALL OTHER GOVERNMENTAL CHARGES WHICH MAY ACCRUE, BE LEVIED OR ASSESSED UPON THE PROPERTY OR ANY PART THEREOF AND WHICH MAY BE OR BECOME A LIEN UPON THE PROPERTY OR HAVE PRIORITY IN PAYMENT TO THE INDEBTEDNESS HEREBY SECURED WHEN AND AS THE SAME BECOME DUE, AND BEFORE ANY DELINQUENCY OCCURS OR ANY PENALTY SO ASSESSED THEREON. UPON REQUEST BY MORTGAGEE, MORTGAGOR SHALL PAY TO MORTGAGEE ON THE DAY MONTHLY INSTALLMENTS OF PRINCIPAL AND/OR INTEREST ARE PAYABLE UNDER THE NOTE (OR ON ANOTHER DAY DESIGNED IN WRITING BY MORTGAGEE), UNTIL THE NOTE IS PAID IN FULL, A SUM (HEREIN “FUNDS”) EQUAL TO ONE-TWELFTH OF (A) THE YEARLY TAXES AND ASSESSMENTS WHICH MAY BE LEVIED ON THE PROPERTY; (B) THE YEARLY GROUND RENTS, IF ANY; AND (C) THE YEARLY PREMIUM INSTALLMENTS FOR FIRE AND OTHER HAZARD INSURANCE, RENT LOSS INSURANCE AND SUCH OTHER INSURANCE AS MAY BE REQUIRED UNDER THE TERMS OF THIS MORTGAGE, ALL AS REASONABLY ESTIMATED INITIALLY AND FROM TIME TO TIME BY MORTGAGEE, ON THE BASIS OF ASSESSMENTS AND BILLS AND REASONABLE ESTIMATES THEREOF. UNLESS OTHERWISE AGREED IN WRITING BY MORTGAGEE AND MORTGAGOR, MORTGAGEE MAY REQUIRE MORTGAGOR TO PAY TO MORTGAGEE, IN ADVANCE, SUCH OTHER FUNDS FOR OTHER TAXES, CHARGES, PREMIUMS, ASSESSMENTS AND IMPOSITIONS IN CONNECTION WITH MORTGAGOR OR THE PROPERTY WHICH MORTGAGEE SHALL REASONABLY DEEM NECESSARY TO PROTECT MORTGAGEE’S INTERESTS (ALL OF WHICH SHALL BE REFERRED TO HEREIN AS “OTHER IMPOSITIONS”). UNLESS OTHERWISE PROVIDED BY APPLICABLE LAW, MORTGAGEE, AT MORTGAGEE’S OPTION, MAY REQUIRE AMOUNTS DUE UNDER THIS SECTION 2.3 TO BE PAID BY MORTGAGOR IN A LUMP SUM NOT MORE THAN THIRTY (30) DAYS PRIOR TO THE DATE DUE OR IN PERIODIC INSTALLMENTS.

THE FUNDS SHALL BE HELD IN AN ACCOUNT WITH MORTGAGEE. TO THE EXTENT THAT FUNDS HAVE BEEN DEPOSITED BY MORTGAGOR WITH MORTGAGEE FOR THE EXPRESS PURPOSE OF PAYMENT OF WATER AND SEWER RATES, TAXES, ASSESSMENTS, GROUND RENTS, INSURANCE PREMIUMS OR OTHER IMPOSITIONS AND THE AMOUNT IN ESCROW IS SUFFICIENT TO PAY ANY BILL FOR ANY SUCH CHARGE WHILE MAINTAINING IN ESCROW FUNDS SUFFICIENT TO MEET MORTGAGOR’S OTHER OBLIGATIONS UNDER THIS SECTION 2.3, UPON WRITTEN REQUEST BY MORTGAGOR, OR AT ANY TIME AS MAY BE DETERMINED BY MORTGAGEE, MORTGAGEE SHALL DISBURSE SUCH FUNDS TO APPLY TO THE PAYMENT OF SUCH BILL. MORTGAGEE SHALL APPLY THE FUNDS TO PAY SAID RATES, RENTS, TAXES, ASSESSMENTS, INSURANCE PREMIUMS AND OTHER IMPOSITIONS SO LONG AS THERE IS NOT AN EVENT OF DEFAULT. MORTGAGEE SHALL MAKE NO CHARGE FOR SO HOLDING AND APPLYING THE FUNDS, ANALYZING SAID ACCOUNT OR FOR VERIFYING AND COMPILING SAID ASSESSMENTS AND BILLS, UNLESS MORTGAGEE PAYS MORTGAGOR INTEREST, EARNINGS OR PROFITS ON THE FUNDS AND APPLICABLE LAW PERMITS MORTGAGEE TO MAKE SUCH A CHARGE. UNLESS APPLICABLE LAW REQUIRES INTEREST, EARNINGS OR PROFITS TO BE PAID, MORTGAGEE SHALL NOT BE REQUIRED TO PAY MORTGAGOR ANY INTEREST, EARNINGS OR PROFITS ON THE FUNDS. MORTGAGEE SHALL GIVE TO MORTGAGOR, WITHOUT CHARGE, AN ANNUAL ACCOUNTING OF THE FUNDS IN MORTGAGEE’S NORMAL FORMAT SHOWING CREDITS AND DEBITS TO THE FUNDS AND THE PURPOSE FOR WHICH EACH DEBIT TO THE FUNDS WAS MADE. THE FUNDS ARE PLEDGED AS ADDITIONAL SECURITY FOR THE INDEBTEDNESS SECURED BY THIS MORTGAGE.

IF THE AMOUNT OF THE FUNDS HELD BY MORTGAGEE AT THE TIME OF THE ANNUAL ACCOUNTING THEREOF SHALL EXCEED THE AMOUNT DEEMED NECESSARY BY MORTGAGEE TO PROVIDE FOR THE PAYMENT OF WATER AND SEWER RATES, TAXES, ASSESSMENTS, INSURANCE PREMIUMS, RENTS AND OTHER IMPOSITIONS, AS THEY FALL DUE, SUCH EXCESS SHALL BE CREDITED TO MORTGAGOR ON THE NEXT MONTHLY INSTALLMENT OR INSTALLMENTS OF FUNDS DUE. IF AT ANY TIME THE AMOUNT OF THE FUNDS HELD BY MORTGAGEE SHALL BE LESS THAN THE AMOUNT DEEMED NECESSARY BY MORTGAGEE TO PAY WATER AND SEWER RATES, TAXES, ASSESSMENTS, INSURANCE PREMIUMS, RENT, AND OTHER IMPOSITIONS, AS THEY FALL DUE, MORTGAGOR SHALL PAY TO MORTGAGEE ANY AMOUNT NEC