Exhibit 10.14

 

TIAA Authorization ID # AAA- 7440

TIAA Inv. ID # 0007003

Windsor Green at Andover

 

MORTGAGE, ASSIGNMENT OF LEASES AND RENTS,

SECURITY AGREEMENT AND FIXTURE FILING

 

by

 

HAMILTON GREEN APARTMENTS, LLC,

as Borrower

 

for the benefit of

 

TEACHERS INSURANCE AND ANNUITY ASSOCIATION

OF AMERICA,

having an address at:

 730 Third Avenue, New York, New York l0017,

as Lender,

 

Property Known As

 

Windsor Green at Andover

311 Lowell Street

Andover, MA 01810

 

Authorization #:AAA-7440

Investment ID#: 0007003

 

This Mortgage Was Prepared By

After Recordation This Mortgage Should Be Returned To:

 

Robert E. Grady, Esquire

c/o Logan Grady LLC

1233 Silas Deane Highway

Wethersfield, CT 06109

 

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MORTGAGE, ASSIGNMENT OF LEASES AND RENTS,

SECURITY AGREEMENT AND FIXTURE FILING

 

THIS MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE
FILING made this 20th day of December, 2013, by HAMILTON GREEN APARTMENTS, LLC,
a Delaware limited liability company (“Borrower”), having its principal place of
business at 39 Brighton Avenue, Boston, Massachusetts 02134, for the benefit of
TEACHERS INSURANCE AND ANNUITY ASSOCIATION OF AMERICA (“Lender”), a New York
corporation, having an address at 730 Third Avenue, New York, New York l0017.

 

RECITALS:

 

A.  Lender agreed to make and Borrower agreed to accept a loan (the “Loan”) in
the maximum principal amount of $38,500,000.00.

 

B.  To evidence the Loan, Borrower executed and delivered to Lender a promissory
note (the “Note”), dated the date of this Mortgage, in the principal amount of
Thirty-Eight Million Five Hundred Thousand and NO/100 Dollars ($38,500,000.00)
(that amount or so much as is outstanding from time to time is referred to as
the “Principal”), promising to pay the Principal with interest thereon to the
order of Lender as set forth in the Note and with the balance, if any, of the
Debt being due and payable on January 1, 2029 (the “Maturity Date”).

 

C.  To secure the Note, this Mortgage encumbers, among other things, Borrower’s
fee interest in the real property located in the Town of Andover, County of
Essex, Commonwealth of Massachusetts, more particularly described in Exhibit A
(the “Land”).

 

ARTICLE I

DEFINITIONS AND RULES OF CONSTRUCTION

 

Section 1.1.                                 Definitions.  Capitalized terms
used in this Mortgage are defined in Exhibit B or in the text with a
cross-reference in Exhibit B.

 

Section 1.2.                                 Rules of Construction.  This
Mortgage will be interpreted in accordance with the rules of construction set
forth in Exhibit C.

 

ARTICLE II

GRANTING CLAUSES

 

Section 2.1.  Encumbered Property.  Borrower irrevocably GRANTS, BARGAINS,
SELLS, MORTGAGES, WARRANTS, CONVEYS, ASSIGNS, PLEDGES and CONVEYS with MORTGAGE
COVENANTS to Lender, TO HAVE AND HOLD IN TRUST, upon the STATUTORY CONDITION and
with the STATUTORY POWER OF SALE, the following property, rights, interests and
estates now or in the future owned or held by Borrower (the “Property”) for the
uses and purposes set forth in this Mortgage forever (capitalized terms used in

 

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this Section 2.1 and 2.3 and not defined in this Mortgage have the meanings
ascribed to them in the Uniform Commercial Code):

 

(i)                                     the Land;

 

(ii)                                  all buildings and improvements located on
the Land (the “Improvements”);

 

(iii)                               all easements; rights of way or use,
including any rights of ingress and egress; streets, roads, ways, sidewalks,
alleys and passages; strips and gores; sewer rights; water, water rights, water
courses, riparian rights and drainage rights; air rights and development rights;
oil and mineral rights; and tenements, hereditaments and appurtenances, in each
instance adjoining or otherwise appurtenant to or benefiting the Land or the
Improvements;

 

(iv)                              all General Intangibles (including Software)
and Goods, related to, attached to, contained in or used in connection with the
Land or the Improvements (excluding personal property owned by tenants);

 

(v)                                 all agreements, ground leases, grants of
easements or rights-of-way, permits, declarations of covenants, conditions and
restrictions, disposition and development agreements, planned unit development
agreements, cooperative, condominium or similar ownership or conversion plans,
management, leasing, brokerage or parking agreements or other material documents
affecting Borrower or the Property, including the documents described on
Exhibit D but expressly excluding the Leases (the “Property Documents”);

 

(vi)                              all Inventory held for sale, lease or resale
or furnished or to be furnished under contracts of service, or used or consumed
in the ownership, use or operation of the Property and all Documents evidencing
any part of any of the foregoing;

 

(vii)                           all Accounts, Documents, Goods, Instruments,
money, Deposit Accounts, Chattel Paper, Letter-of-Credit Rights, Investment
Property, General Intangibles and Supporting Obligations relating to the
Property, including all deposits held from time to time by the Accumulations
Depositary to provide reserves for Taxes and Assessments together with interest
credited thereon (the “Accumulations”) and all deposits for reserves held from
time to time in accordance with the Section entitled “Reserves” and all accounts
established to maintain the deposits together with investments thereof and any
interest credited thereon;

 

(viii)                        all awards and other compensation paid after the
date of this Mortgage for any Condemnation (the “Condemnation Awards”);

 

(ix)                              all proceeds of and all unearned premiums on
the Policies (the “Insurance Proceeds”);

 

(x)                                 all licenses, certificates of occupancy,
contracts, management agreements, operating agreements, operating covenants,
franchise agreements, permits and variances relating to the Property;

 

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(xi)                              all books, records and other information,
wherever located, which are in Borrower’s possession, custody or control or to
which Borrower is entitled at law or in equity and which are related to the
Property, including all computer hardware and software or other equipment used
to record, store, manage, manipulate or access the information; and

 

(xii)                           all after-acquired title to or remainder or
reversion in any of the property described in this Section; all proceeds
(excluding, however, sales or other dispositions of Inventory in the ordinary
course of the business of operating the Land or the Improvements), replacements,
substitutions, products, accessions and increases of or for the Property; all
additions, accessions and extensions to, improvements of or for the Property;
and all additional lands, estates, interests, rights or other property acquired
by Borrower after the date of this Mortgage for use in connection with the Land
or the Improvements, all without the need for any additional mortgage,
assignment, pledge or conveyance to Lender but Borrower will execute and deliver
to Lender, upon Lender’s request, any documents reasonably requested by Lender
to further evidence the foregoing.

 

Section 2.2.                                 Habendum Clause.  The Property is
conveyed to Lender to have and to hold forever in fee simple.

 

Section 2.3.                                 Security Agreement.

 

(a)                                 The Property includes both real and personal
property and this Mortgage is a real property mortgage and also a “security
agreement” and a “financing statement” within the meaning of the Uniform
Commercial Code.  By executing and delivering this Mortgage, Borrower grants to
Lender, as security for the Obligations, a security interest in the Property to
the full extent that any of the Property may be subject to the Uniform
Commercial Code.

 

(b)                                 This Mortgage constitutes a fixture filing
under the Laws of the state or commonwealth in which the Property is located and
for such purpose, Borrower represents, as of the date hereof, that the following
information set forth in clauses (i), (v) and (vi), is true and correct:

 

(i)                                     The exact legal name and address of
Debtor is:

 

Hamilton Green Apartments, LLC

39 Brighton Avenue

Boston, Massachusetts 02134

 

(ii)                                  Name and address of Secured Party:

 

Teachers Insurance and Annuity Association of America

730 Third Avenue

New York, New York 10017

 

(iii)                               Description of the types (or items) of
property covered by this Financing Statement: all of the property described in
section ii-xii of the Section entitled

 

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“Encumbered Property” described or referred to herein and included as part of
the Property.

 

(iv)                              Description of real estate to which collateral
is attached or upon which it is located:  Described in Exhibit A.

 

(v)                                 Debtor’s Organizational Identification
Number: 5420481.

 

(vi)                              Debtor’s chief executive office is located in
the State or Commonwealth of Massachusetts, and Debtor’s state or commonwealth
of formation is the State or Commonwealth of Delaware.

 

Lender 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 is sufficient
as a financing statement.

 

Section 2.4.  Conditions to Grant.  This Mortgage is made on the express
condition that if Borrower pays and performs the Obligations in full in
accordance with the Loan Documents, then, unless expressly provided otherwise in
the Loan Documents, the Loan Documents will be released at Borrower’s expense.

 

ARTICLE III

OBLIGATIONS SECURED

 

Section 3.1.  The Obligations.  This Mortgage secures the Principal, the
Interest, the Late Charges, the Prepayment Premiums, the Expenses, any
additional advances made by Lender in connection with the Property or the Loan
and all other amounts payable under the Loan Documents (the “Debt”) and also
secures both the timely payment of the Debt as and when required and the timely
performance of all other obligations and covenants to be performed under the
Loan Documents (the “Obligations”).

 

ARTICLE IV

TITLE AND AUTHORITY

 

Section 4.1.  Title to the Property.

 

(a)                                 Borrower has and will continue to have good
and marketable title in fee simple absolute to the Land and the Improvements and
good and marketable title to the Fixtures and Personal Property, all free and
clear of liens, encumbrances and charges except the Permitted Exceptions.  To
Borrower’s knowledge, there are no facts or circumstances that might give rise
to a lien, encumbrance or charge on the Property that may have an adverse effect
on the use or value of the Property or the priority of the lien of this
Mortgage.

 

(b)                                 Borrower owns and will continue to own all
of the other Property free and clear of all liens, encumbrances and charges
except the Permitted Exceptions.

 

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(c)                                  This Mortgage is and will remain a valid
and enforceable first lien on and security interest in the Property, subject
only to the Permitted Exceptions.

 

Section 4.2.  Authority.

 

(a)                                 Borrower is and will continue to be (i) duly
organized, validly existing and in good standing under the Laws of the state or
commonwealth in which it was formed, organized or incorporated as set forth in
Section 2.3 and (ii) duly qualified to conduct business, in good standing, in
the state or commonwealth where the Property is located.

 

(b)                                 Borrower has and will continue to have all
approvals required by Law or otherwise and full right, power and authority to
(i) own and operate the Property and carry on Borrower’s business as now
conducted or as proposed to be conducted; (ii) execute and deliver the Loan
Documents; (iii) grant, mortgage, warrant the title to, convey, assign and
pledge the Property to Lender pursuant to the provisions of this Mortgage; and
(iv) perform the Obligations.

 

(c)                                  The execution and delivery of the Loan
Documents and the performance of the Obligations do not and will not conflict
with or result in a default under any Laws or any Leases or Property Documents
and do not and will not conflict with or result in a default under any agreement
binding upon any party to the Loan Documents.

 

(d)                                 The Loan Documents constitute and will
continue to constitute legal, valid and binding obligations of all parties to
the Loan Documents enforceable in accordance with their respective terms.

 

(e)                                  Borrower has not changed its legal name or
its state or commonwealth of formation, as set forth in Section 2.3, in the four
months prior to the date hereof, except as Borrower has disclosed any such
change to Lender in writing and delivered to Lender appropriate Uniform
Commercial Code search reports in connection therewith (it being acknowledged
and agreed that Borrower has disclosed the Permitted Merger to Lender in writing
and delivered appropriate Uniform Commercial Code search reports in connection
therewith).  As used herein, the “Permitted Merger” means the merger of Hamilton
Green Apartments, LLC, a Massachusetts limited liability company with and into
Borrower, with Borrower being the surviving entity of such merger.

 

(f)                                   Borrower has not (i) merged with or into
any other entity or otherwise been involved in any reorganization or
(ii) acquired substantially all of the assets of any other entity where Borrower
became subject to the obligations of such entity, for a period of one year
ending on the date hereof, except as Borrower has disclosed any such change,
merger, reorganization or acquisition to Lender in writing and delivered to
Lender appropriate Uniform Commercial Code search reports in connection
therewith (it being acknowledged and agreed that Borrower has disclosed the
Permitted Merger to Lender in writing and delivered appropriate Uniform
Commercial Code search reports in connection therewith).

 

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(g) The Independent Manager has been engaged, appointed and is now an
independent manager under the terms of Borrower’s partnership certificate,
partnership agreement, articles of incorporation, by-laws, operating agreement,
articles of organization, or any other organizational filing or document
governing the affairs of Borrower.

 

Section 4.3.  No Foreign Person.  Borrower is not a “foreign person” within the
meaning of Section 1445(f)(3) of the Code.

 

Section 4.4.  Litigation.  There are no Proceedings or, to Borrower’s knowledge,
investigations against or affecting Borrower or the Property and, to Borrower’s
knowledge, there are no facts or circumstances that might give rise to a
Proceeding or an investigation against or affecting Borrower or the Property.
 Borrower will give Lender prompt notice of the commencement of any Proceeding
or investigation against or affecting the Property or Borrower which could have
a material adverse effect on the Property or on Lender’s interests in the
Property or under the Loan Documents and, at Borrower’s expense, will appear in
and defend any such Proceeding or investigation.  Borrower also will deliver to
Lender such additional information relating to the Proceeding or investigation
as Lender may request from time to time.

 

ARTICLE V

PROPERTY STATUS, MAINTENANCE AND LEASES

 

Section 5.1.  Status of the Property.

 

(a)  Borrower has obtained and will maintain in full force and effect all
certificates, licenses, permits and approvals that are issued or required by Law
or by any entity having jurisdiction over the Property or over Borrower or that
are necessary for the Permitted Use, for occupancy and operation of the
Property, for the granting of this Mortgage or for the conduct of Borrower’s
business on the Property in accordance with the Permitted Use.  Without limiting
any of the foregoing, Borrower is in compliance with the Comprehensive Permit
and the Regulatory Agreement.

 

(b)  The Property is and will continue to be serviced by all public utilities
required for the Permitted Use of the Property.

 

(c)  All roads and streets necessary for service of and access to the Property
for the current or contemplated use of the Property have been completed and are
and will continue to be serviceable, physically open and dedicated to and
accepted by the Government for use by the public.

 

(d)  The Property is free from damage caused by a Casualty.

 

(e)  All costs and expenses of labor, materials, supplies and equipment used in
the construction of the Improvements have been paid in full.

 

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Section 5.2.  Maintenance of the Property.  Borrower will maintain the Property
in thorough repair and good and safe condition, suitable for the Permitted Use,
including, to the extent necessary, replacing the Fixtures and Personal Property
with property at least equal in quality and condition to that being replaced and
free of liens.  Borrower will not erect any new buildings, building additions or
other structures on the Land or otherwise materially alter the Improvements
without Lender’s prior consent which may be withheld in Lender’s sole
discretion.  The Property will be managed by a property manager satisfactory to
Lender pursuant to a management agreement satisfactory to Lender and terminable
by Borrower without charge or penalty upon 30 days notice to the property
manager.

 

Section 5.3.  Change in Use.  Borrower will use and permit the use of the
Property for the Permitted Use and for no other purpose.

 

Section 5.4.  Waste.  Borrower will not commit or permit any waste (including
economic and non-physical waste), impairment or deterioration of the Property or
any alteration, demolition or removal of any of the Property without Lender’s
prior consent which may be withheld in Lender’s sole discretion (notwithstanding
the foregoing provisions of this Section 5.4 to the contrary, Borrower shall be
permitted to alter any improvements comprising the Property and/or remove any of
the Personal Property or Fixtures absent Lender consent, provided that any such
alteration or removal is performed in the ordinary course of Borrower’s business
and in a manner necessary to maintain the Property in accordance with the
provisions of Section 5.2 hereof).

 

Section 5.5.  Inspection of the Property.  Subject to the rights of tenants
under the Leases, Lender, or its agent or independent expert, has the right to
enter and inspect the Property on reasonable prior notice, except during the
existence of an Event of Default, when no prior notice is necessary.  Lender has
the right to engage an independent expert to review and report on Borrower’s
compliance with Borrower’s obligations under this Mortgage to maintain the
Property, comply with Law and refrain from waste, impairment or deterioration of
the Property and the alteration, demolition or removal of any of the Property
except as may be permitted by the provisions of this Mortgage.  If the
independent expert’s report discloses material failure to comply with such
obligations or if Lender engages the independent expert after the occurrence of
an Event of Default, then the independent expert’s review and report will be at
Borrower’s expense, payable on demand (otherwise the cost of such independent
expert’s review and report shall be at Lender’s or its designated agent’s
expense).

 

Section 5.6.  Leases and Rents.

 

(a)  Borrower assigns the Leases and the Rents to Lender absolutely and
unconditionally and not merely as additional collateral or security for the
payment and performance of the Obligations, but subject to a license back to
Borrower of the right to collect the Rents unless and until an Event of Default
occurs at which time the license will terminate automatically, all as more
particularly set forth in the Assignment, the provisions of which are
incorporated in this Mortgage by reference.

 

(b)  Borrower appoints Lender as Borrower’s attorney-in-fact to execute
unilaterally and record, at Lender’s election, a document subordinating this
Mortgage to the Leases, provided that the subordination will not affect (i) the
priority of Lender’s entitlement to Insurance Proceeds or

 

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Condemnation Awards or (ii) the priority of this Mortgage over intervening liens
or liens arising under or with respect to the Leases.

 

Section 5.7.                                 Parking.  Borrower will provide,
maintain, police and light parking areas within the Property, including any
sidewalks, aisles, streets, driveways, sidewalk cuts and rights-of-way to and
from the adjacent public streets, in a manner consistent with the Permitted Use
and sufficient to accommodate the greatest of: (i) the number of parking spaces
required by Law; (ii) the number of parking spaces required by the Leases and
the Property Documents; or (iii) not less than 375 parking spaces.  The parking
areas will be reserved and used exclusively for ingress, egress and parking for
Borrower and the tenants under the Leases and their respective employees,
customers and invitees and in accordance with the Leases and the Property
Documents.

 

Section 5.8.                                 Separate Tax Lot.  The Property is
and will remain assessed for real estate tax purposes as one or more wholly
independent tax lots, separate from any property that is not part of the
Property.

 

Section 5.9.                                 Changes in Zoning or Restrictive
Covenants.  Borrower will not (i) initiate, join in or consent to any change in
any Laws pertaining to zoning, any restrictive covenant or other restriction
which would restrict the Permitted Uses for the Property; (ii) permit the
Property to be used to fulfill any requirements of Law for the construction or
maintenance of any improvements on property that is not part of the Property;
(iii) permit the Property to be used for any purpose not included in the
Permitted Use; or (iv) impair the integrity of the Property as a single, legally
subdivided zoning lot separate from all other property.

 

Section 5.10.                          Lender’s Right to Appear.  Lender has the
right to appear in and defend any Proceeding brought regarding the Property and
to bring any Proceeding, in the name and on behalf of Borrower or in Lender’s
name, which Lender, in its sole discretion, determines should be brought to
protect Lender’s interest in the Property.

 

ARTICLE VI

IMPOSITIONS AND ACCUMULATIONS

 

Section 6.1.  Impositions.

 

(a)  Borrower will pay each Imposition at least 15 days before the date (the
“Imposition Penalty Date”) that is the earlier of (i) the date on which the
Imposition becomes delinquent and (ii) the date on which any penalty, interest
or charge for non-payment of the Imposition accrues.  Notwithstanding the
foregoing, Lender will cause the Accumulations Depositary (i.e. the pledge
agent), if any, under the Tax Pledge to pay all Real Estate Taxes (i.e. all
“Taxes” as defined in the Tax Pledge) on or prior to the earlier of the dates
set forth in clauses (i) and (ii) of the preceding sentence, provided that
(A) without limiting any other provisions set forth herein, Borrower has timely
paid to said pledge agent for deposit in the account established under the Tax
Pledge sufficient funds for the payment of such Real Estate Taxes (and any other
Real Estate Taxes then due and owing any other “Tax Authority”, as defined in
the Tax Pledge) and all fees and other amounts that may then be due under the
Tax Pledge (it being acknowledged and agreed that the reference set forth in
this clause (A) to “timely paid” shall mean that Borrower has made such

 

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payments to said pledge agent for deposit in such account at least 15 days
before the Imposition Penalty Date), (B) in accordance with the terms of the Tax
Pledge, Lender or said pledge agent has received a bill or other evidence of
such Real Estate Taxes not less than 15 Business Days before the Imposition
Penalty Date and (C) no Event of Default has occurred and is then continuing
(the conditions set forth in clauses (A)-(C), collectively, the “Payment
Conditions Precedent”).  In the event each of the Payment Conditions Precedent
has been satisfied in a timely manner and the pledge agent fails to pay the
applicable Real Estate Taxes on or prior to the Imposition Penalty Date, Lender
(without waiving any rights Lender may have against such pledge agent) shall
cause such Real Estate Taxes to be paid and shall hold Borrower harmless from
any penalties that may accrue as a result of any such non-payment or late
payment (provided that Borrower shall promptly advise Lender in writing of any
notice of non-payment or late payment that Borrower may receive from the
applicable Tax Authority).

 

(b)  At least 10 days before each Imposition Penalty Date, Borrower will deliver
(or cause to be delivered) to Lender or its designated agent a receipted bill or
other evidence of payment (provided that Borrower shall be deemed to have
satisfied such requirement in the event and to the extent the applicable
governmental authority shall have delivered such receipted bill or other
evidence of payment to Lender or such designated agent).

 

(c)  Borrower, at its own expense, may contest any Taxes or Assessments,
provided that the following conditions are met:

 

(i)                                     not less than 30 days prior to the
Imposition Penalty Date, Borrower delivers to Lender notice of the proposed
contest;

 

(ii)                                  the contest is by a Proceeding promptly
initiated and conducted diligently and in good faith;

 

(iii)                               there is no Event of Default;

 

(iv)                              the Proceeding suspends the collection of the
contested Taxes or Assessments;

 

(v)                                 the Proceeding is permitted under and is
conducted in accordance with the Leases and the Property Documents;

 

(vi)                              the Proceeding precludes imposition of
criminal or civil penalties and sale or forfeiture of the Property and Lender
will not be subject to any civil suit; and

 

(vii)                           Borrower either deposits with the Accumulations
Depositary reserves or furnishes a bond or other security satisfactory to
Lender, in either case in an amount sufficient to pay the contested Taxes or
Assessments, together with all interest and penalties or Borrower pays all of
the contested Taxes or Assessments under protest.

 

(d)  Installment Payments.  If any Assessment is payable in installments,
Borrower will nevertheless pay the Assessment in its entirety on the day the
first installment becomes due and

 

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payable or a lien, unless Lender, in its sole discretion, approves payment of
the Assessment in installments.  Borrower has advised Lender that as of the date
hereof real estate taxes with respect to the Property are payable in quarterly
installments.  Absent the occurrence and continuance of an Event of Default,
Lender hereby consents to the payment of such real estate taxes in such
quarterly installments provided that each such installment is paid on or prior
to the date on which the same would otherwise become past due or result in a
lien.

 

Section 6.2.  Accumulations.

 

(a)  In accordance with the Tax Pledge, Borrower made an initial deposit with
either Lender or a mortgage servicer or financial institution designated or
approved by Lender from time to time, acting on behalf of Lender as Lender’s
agent or otherwise such that Lender is the “customer”, as defined in the Uniform
Commercial Code, of the depository bank with respect to the deposit account into
which the Accumulations are deposited, to receive, hold and disburse the
Accumulations in accordance with the Tax Pledge (the “Accumulations
Depositary”).  On the first day of each calendar month during the Term, Borrower
will deposit with the Accumulations Depositary an amount equal to 1/12th of the
annual Real Estate Taxes as determined by Lender or its agent. Except as
otherwise required by the Tax Pledge, at least 30 days before each Imposition
Penalty Date, Borrower will deliver to the Accumulations Depositary any bills
and other documents that are necessary to pay the Real Estate Taxes.

 

(b)  The Accumulations will be applied to the payment of the Real Estate Taxes. 
Any excess Accumulations after payment of the Real Estate Taxes will be returned
to Borrower or credited against future payments of the Accumulations, at
Lender’s election or as required by Law.  If the Accumulations are not
sufficient to pay the Real Estate Taxes, except as otherwise required by the Tax
Pledge, Borrower shall promptly pay the deficiency to the Accumulations
Depositary (any in any event, not less than 10 Business Days prior to the
Imposition Penalty Date).

 

(c)  The Accumulations Depositary will hold the Accumulations as security for
the Obligations until applied in accordance with the provisions of this Mortgage
and the Tax Pledge.  If Lender is not the Accumulations Depositary, the
Accumulations Depositary will deliver the Accumulations to Lender upon Lender’s
demand at any time after an Event of Default.

 

(d)  If the Property is sold or conveyed other than by foreclosure or transfer
in lieu of foreclosure, all right, title and interest of Borrower to the
Accumulations will automatically, and without necessity of further assignment,
be held for the account of the new owner, subject to the provisions of this
Section and Borrower will have no further interest in the Accumulations.

 

(e) The Accumulations Depositary has deposited the initial deposit and will
deposit the monthly deposits into an account with a financial institution
selected by Lender, which funds may be held in either a separate or commingled
account, all in accordance with the Tax Pledge. If Lender is the Accumulations
Depositary, Lender shall have no obligation to pay interest on such
Accumulations.

 

(f)  Lender has the right to pay, or to direct the Accumulations Depositary to
pay, any Real Estate Taxes unless Borrower is contesting such Real Estate Taxes
in accordance with the

 

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provisions of this Mortgage, in which event any payment of the contested Real
Estate Taxes will be made under protest in the manner prescribed by Law or, at
Lender’s election, will be withheld.

 

(g)  If Lender assigns this Mortgage, Lender will pay, or cause the
Accumulations Depositary to pay, the unapplied balance of the Accumulations to
or at the direction of the assignee.  Simultaneously with the payment, Lender
and the Accumulations Depositary will be released from all liability with
respect to the Accumulations and Borrower will look solely to the assignee with
respect to the Accumulations.  When the Obligations have been fully satisfied,
any unapplied balance of the Accumulations will be returned to Borrower.  At any
time after an Event of Default occurs, Lender may apply the Accumulations as a
credit against any portion of the Debt selected by Lender in its sole
discretion.

 

Section 6.3.                                 Changes in Tax Laws.  If a Law
requires the deduction of the Debt from the value of the Property for the
purpose of taxation or imposes a tax, either directly or indirectly, on the
Debt, any Loan Document or Lender’s interest in the Property, Borrower will pay
the tax with interest and penalties, if any.  If Lender determines that
Borrower’s payment of the tax may be unlawful, unenforceable, usurious or
taxable to Lender, the Debt will become immediately due and payable on 60 days’
prior notice unless the tax must be paid within the 60-day period, in which
case, the Debt will be due and payable within the lesser period.

 

Section 6.4.                                 Reserves.  Commencing on January 1,
2020, Borrower will make monthly deposits into an account established as
security for the payment and performance of the Obligations, to be held and
disbursed in accordance with a Reserve and Security Agreement dated the date of
this Mortgage among Borrower, Lender and Lender’s pledge agent.

 

ARTICLE VII

INSURANCE, CASUALTY, CONDEMNATION

AND RESTORATION

 

Section 7.1.  Insurance Coverages.

 

(a)  Borrower will maintain such insurance coverages and endorsements in form
and substance as Lender may require in its sole discretion from time to time. 
The insurance will be in an amount equal to 100% of the full replacement cost of
the Improvements and Personal Property (without deduction for depreciation) and
will include fire, extended coverage, vandalism, malicious mischief, sprinkler
leakage, boiler and machinery, terrorism coverage, windstorm, earthquake and
flood insurance (if located in an area identified as an earthquake or flood
zone), day care facility general liability and umbrella coverage (if any portion
of the Property is used as a day care or childcare services facility), and a
minimum of 12 months of rent loss insurance.  The insurance will also include
commercial general liability coverage in substance and amount satisfactory to
Lender naming Lender as an additional insured. Until Lender notifies Borrower of
changes in Lender’s requirements, Borrower will maintain not less than the
insurance coverages and endorsements Lender required for closing of the Loan.

 

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(b)  The insurance, including renewals, required under this Section will be
issued on valid and enforceable policies and endorsements satisfactory to Lender
(the “Policies”).  Each Policy will contain a standard waiver of subrogation and
a replacement cost endorsement and will provide that Lender will receive not
less than 30 days’ prior written notice of any cancellation, termination or
non-renewal of a Policy or any material change other than an increase in
coverage and that Lender will be named under a standard mortgagee endorsement on
the property insurance as mortgagee and loss payee.

 

(c)  The insurance companies issuing the Policies (the “Insurers”) must be
authorized to do business in the State or Commonwealth where the Property is
located, must have been in business for at least 5 years, must carry an A.M.
Best Company, Inc. policy holder rating of A- or better and an A.M. Best
Company, Inc. financial category rating of Class X or better and must be
otherwise satisfactory to Lender.  Lender may select an alternative credit
rating agency and may impose different credit rating standards for the
Insurers.  Notwithstanding Lender’s right to approve the Insurers and to
establish credit rating standards for the Insurers, Lender will not be
responsible for the solvency of any Insurer.

 

(d)  Notwithstanding Lender’s rights under this Article, Lender will not be
liable for any loss, damage or injury resulting from the inadequacy or lack of
any insurance coverage.

 

(e)  Borrower will comply with the provisions of the Policies and with the
requirements, notices and demands imposed by the Insurers and applicable to
Borrower or the Property.

 

(f)  Borrower will pay the insurance premiums for each Policy and provide Lender
with evidence of such payment within 15 days of the expiration date of the
Policy being replaced or renewed and Borrower will deliver to Lender a certified
copy of each Policy marked “Paid” not less than 15 days prior to the expiration
date of the Policy being replaced or renewed. In the event Borrower is unable to
deliver a certified copy 15 days prior to the expiration date, Borrower will
provide evidence of the renewed coverage by delivering to Lender an Acord 27
(2004/04 or 1993/03) or Acord 28 (2003/10) or the current industry equivalent
until a certified copy is available and delivered to Lender.

 

(g)  Borrower will not carry separate insurance concurrent in kind or form or
contributing in the event of loss with any other insurance carried by Borrower.

 

(h) If Borrower elects to carry any of the insurance required under this
Section on a blanket or umbrella policy, Borrower will deliver to Lender a
certified copy of the blanket policy which will allocate to the Property the
amount of coverage required under this Section and otherwise will provide the
same coverage and protection as would a separate policy insuring only the
Property.

 

(i)  Borrower will give the Insurers and Lender prompt notice of any change in
ownership or occupancy of the Property that may result in a change in the
insurance requirements for the Property.  This subsection does not abrogate the
prohibitions on transfers set forth in this Mortgage.

 

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(j)  If the Property is sold at a foreclosure sale or otherwise is transferred
so as to extinguish the Obligations, all of Borrower’s right, title and interest
in and to the Policies then in force will be transferred automatically to the
purchaser or transferee.

 

Section 7.2.  Casualty and Condemnation.

 

(a)  Borrower will give Lender notice of any Casualty immediately after it
occurs and will give Lender notice of any Condemnation Proceeding immediately
after Borrower receives notice of commencement or notice that such a
Condemnation Proceeding will be commencing.  Borrower immediately will deliver
to Lender copies of all documents Borrower delivers or receives relating to the
Casualty or the Condemnation Proceeding, as the case may be.

 

(b)  Borrower authorizes Lender, at Lender’s option, to act on Borrower’s behalf
to collect, adjust and compromise any claims for loss, damage or destruction
under the Policies on such terms as Lender determines in Lender’s sole
discretion.  Borrower authorizes Lender to act, at Lender’s option, on
Borrower’s behalf in connection with any Condemnation Proceeding.  Borrower will
execute and deliver to Lender all documents requested by Lender and all
documents as may be required by Law to confirm such authorizations.  Nothing in
this Section will be construed to limit or prevent Lender from joining with
Borrower either as a co-defendant or as a co-plaintiff in any Condemnation
Proceeding.

 

(c)  If Lender elects not to act on Borrower’s behalf as provided in this
Section, then Borrower promptly will file and prosecute all claims (including
Lender’s claims) relating to the Casualty and will prosecute or defend
(including defense of Lender’s interest) any Condemnation Proceeding.  Borrower
will have the authority to settle or compromise the claims or Condemnation
Proceeding, as the case may be, provided that Lender has approved in Lender’s
sole discretion any compromise or settlement that exceeds $500,000.00.  Any
check for Insurance Proceeds or Condemnation Awards, as the case may be (the
“Proceeds”) will be made payable to Lender and Borrower.  Borrower will endorse
the check to Lender immediately upon Lender presenting the check to Borrower for
endorsement or if Borrower receives the check first, will endorse the check
immediately upon receipt and forward it to Lender.  If any Proceeds are paid to
Borrower, Borrower immediately will deposit the Proceeds with Lender, to be
applied or disbursed in accordance with the provisions of this Mortgage.  Lender
will be responsible for only the Proceeds actually received by Lender.

 

Section 7.3.  Application of Proceeds.  After deducting the costs incurred by
Lender in collecting the Proceeds, Lender may, in its sole discretion, (i) apply
the Proceeds as a credit against any portion of the Debt selected by Lender in
its sole discretion; (ii) apply the Proceeds to restore the Improvements,
provided that Lender will not be obligated to see to the proper application of
the Proceeds and provided further that any amounts released for Restoration will
not be deemed a payment on the Debt; or (iii) deliver the Proceeds to Borrower.

 

Section 7.4.  Conditions to Availability of Proceeds for Restoration. 
Notwithstanding the preceding Section, after a Casualty or a Condemnation (a
“Destruction Event”), Lender will make the Proceeds (less any costs incurred by
Lender in collecting the Proceeds) available for Restoration

 

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in accordance with the conditions for disbursements set forth in the
Section entitled “Restoration”, provided that the following conditions are met:

 

(i)                                     Hamilton Green Apartments, LLC or the
transferee under a Permitted Transfer, if any, continues to be Borrower at the
time of the Destruction Event and at all times thereafter until the Proceeds
have been fully disbursed;

 

(ii)                                  no default under the Loan Documents exists
at the time of the Destruction Event and no Event of Default has occurred during
the 12 months prior to the Destruction Event;

 

(iii)                               all Property Documents in effect immediately
prior to the Destruction Event continue in full force and effect notwithstanding
the Destruction Event, except as otherwise approved by Lender;

 

(iv)                              if the Destruction Event is a Condemnation,
Borrower delivers to Lender evidence satisfactory to Lender that the
Improvements can be restored to an economically and architecturally viable unit;

 

(v)                                 Borrower delivers to Lender evidence
satisfactory to Lender that the Proceeds are sufficient to complete Restoration
or if the Proceeds are insufficient to complete Restoration, Borrower first
deposits with Lender funds (“Additional Funds”) that when added to the Proceeds
will be sufficient to complete Restoration;

 

(vi)                              if the Destruction Event is a Casualty,
Borrower delivers to Lender evidence satisfactory to Lender that the Insurer
under each affected Policy has not denied liability under the Policy as to
Borrower or the insured under the Policy;

 

(vii)                           Lender is satisfied that the proceeds of any
rent loss insurance in effect together with other available gross revenues from
the Property are sufficient to pay Debt Service Payments after paying Operating
Expenses and capital expenditures until Restoration is complete;

 

(viii)                        Lender is satisfied that Restoration will be
completed on or before the date (the “Restoration Completion Date”) that is the
earliest of:  (A) 12 months prior to the Maturity Date; (B) 12 months after the
Destruction Event; (C) the earliest date required for completion of Restoration
under any Property Document; or (D) any date required by Law; and

 

(ix)                              for the 12 month period immediately preceding
the Destruction Event, the annual Debt Service Coverage was at least 1.25 and
Lender determines, based on projections satisfactory to Lender, that the
Property will be relet within 12 months after Restoration at a projected Net
Operating Income that will provide Debt Service Coverage for the annual Debt
Service Payments of not less than 1.15, provided that, if the projected rents
will not provide such Debt Service Coverage, then Borrower expressly authorizes
and directs Lender (at Lender’s sole discretion) to apply an amount from the
Proceeds to

 

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reduction of Principal in order to reduce the annual Debt Service Payments
sufficiently for such Debt Service Coverage to be achieved.  The reduced debt
service payments will be calculated using interest at the Fixed Interest Rate
and an amortization schedule that will achieve the same proportionate
amortization of the reduced Principal over the then remaining Term as would have
been achieved had the Principal and Debt Service Payments not been reduced. 
Borrower will execute any instruments that Lender deems reasonably necessary to
evidence the reduced Principal and debt service payments.

 

Section 7.5.                                 Restoration.

 

(a)                                 If the total Proceeds for any Destruction
Event are $500,000.00 or less and Lender elects or is obligated by Law or under
this Article to make the Proceeds available for Restoration, Lender will
disburse to Borrower the entire amount received by Lender and Borrower will
commence Restoration promptly after the Destruction Event and complete
Restoration not later than the Restoration Completion Date.

 

(b)                                 If the Proceeds for any Destruction Event
exceed $500,000.00 and Lender elects or is obligated by Law or under this
Article to make the Proceeds available for Restoration, Lender will disburse the
Proceeds and any Additional Funds (the “Restoration Funds”) upon Borrower’s
request as Restoration progresses, generally in accordance with normal
construction lending practices for disbursing funds for construction costs,
provided that the following conditions are met:

 

(i)                                     Borrower commences Restoration promptly
after the Destruction Event and completes Restoration on or before the
Restoration Completion Date;

 

(ii)                                  if Lender requests, Borrower delivers to
Lender prior to commencing Restoration, for Lender’s approval, plans and
specifications and a detailed budget for the Restoration;

 

(iii)                               Borrower delivers to Lender satisfactory
evidence of the costs of Restoration incurred prior to the date of the request,
and such other documents as Lender may request including mechanics’ lien waivers
and title insurance endorsements;

 

(iv)                              Borrower pays all costs of Restoration whether
or not the Restoration Funds are sufficient and, if at any time during
Restoration, Lender determines that the undisbursed balance of the Restoration
Funds is insufficient to complete Restoration, Borrower deposits with Lender, as
part of the Restoration Funds, an amount equal to the deficiency within 30 days
of receiving notice of the deficiency from Lender; and

 

(v)                                 there is no default under the Loan Documents
at the time Borrower requests funds or at the time Lender disburses funds.

 

(c)                                  If an Event of Default occurs at any time
after the Destruction Event, then Lender will have no further obligation to make
any remaining Proceeds available for Restoration and may apply any remaining
Proceeds as a credit against any portion of the Debt selected by Lender in its
sole discretion.

 

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(d)                                 Lender may elect at any time prior to
commencement of Restoration or while work is in progress to retain, at
Borrower’s expense, an independent engineer or other consultant to review the
plans and specifications, to inspect the work as it progresses and to provide
reports.  If any matter included in a report by the engineer or consultant is
unsatisfactory to Lender, Lender may suspend disbursement of the Restoration
Funds until the unsatisfactory matters contained in the report are resolved to
Lender’s satisfaction.

 

(e)                                  If Borrower fails to commence and complete
Restoration in accordance with the terms of this Article, then in addition to
the Remedies, Lender may elect to restore the Improvements on Borrower’s behalf
and reimburse itself out of the Restoration Funds for costs and expenses
incurred by Lender in restoring the Improvements, or Lender may apply the
Restoration Funds as a credit against any portion of the Debt selected by Lender
in its sole discretion.

 

(f)                                   Lender may commingle the Restoration Funds
with its general assets and will not be liable to pay any interest or other
return on the Restoration Funds unless otherwise required by Law.  Lender will
not hold any Restoration Funds in trust.  Lender may elect to deposit the
Restoration Funds with a depositary satisfactory to Lender under a disbursement
and security agreement satisfactory to Lender.

 

(g)                                  Borrower will pay all of Lender’s expenses
incurred in connection with a Destruction Event or Restoration.  If Borrower
fails to do so, then in addition to the Remedies, Lender may from time to time
reimburse itself out of the Restoration Funds.

 

(h)                                 If any excess Proceeds remain after
Restoration, Lender may elect, in its sole discretion either to apply the excess
as a credit against any portion of the Debt as selected by Lender in its sole
discretion or to deliver the excess to Borrower.

 

ARTICLE VIII

COMPLIANCE WITH LAW AND AGREEMENTS

 

Borrower hereby confirms that, as of the date hereof, the representations and
warranties contained in this Article VIII are true, correct and complete and
covenants that until the Debt has been repaid in full, it shall take the actions
or refrain from taking the actions as required by this Article VIII and shall
cause any representations and warranties that are expressly prospective in
nature to be true, correct and complete on every day that the Debt is
outstanding:

 

Section 8.1.                                 Compliance with Law.  Borrower, the
Property and the use of the Property comply and will continue to comply with Law
and with all agreements and conditions necessary to preserve and extend all
rights, licenses, permits, privileges, franchises and concessions (including
zoning variances, special exceptions and non-conforming uses) relating to the
Property or Borrower (including, without limitation, the Comprehensive Permit
and the Regulatory Agreement).  Borrower will notify Lender of the commencement
of any investigation or Proceeding relating to a possible violation of Law
and/or the Comprehensive Permit and/or the Regulatory Agreement immediately
after Borrower receives notice thereof and will deliver promptly to Lender
copies of all documents Borrower receives or delivers in connection with the
investigation or Proceeding.

 

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Borrower will not alter the Property in any manner that would increase
Borrower’s responsibilities for compliance with Law (including, without
limitation, the Comprehensive Permit and the Regulatory Agreement).

 

Section 8.2.                                 Compliance with Agreements.  There
are no defaults, events of defaults or events which, with the passage of time or
the giving of notice, would constitute an event of default under the Property
Documents .  Borrower will pay and perform all of its obligations under the
Property Documents as and when required by the Property Documents.  Borrower
will cause all other parties to the Property Documents to pay and perform their
obligations under the Property Documents as and when required by the Property
Documents.  Borrower will not amend or waive any provisions of the Property
Documents; exercise any options under the Property Documents; give any approval
required or permitted under the Property Documents that would adversely affect
the Property or Lender’s rights and interests under the Loan Documents; cancel
or surrender any of the Property Documents; or release or discharge or permit
the release or discharge of any party to or entity bound by any of the Property
Documents, without, in each instance, Lender’s prior approval (excepting
therefrom all service contracts or other agreements entered into in the normal
course of business that are cancelable upon not more than 30 days notice). 
Borrower promptly will deliver to Lender copies of any notices of default or of
termination that Borrower receives or delivers relating to any Property Document
(including, without limitation, any notices of default or termination provided
for under the Regulatory Agreement and/or the Comprehensive Permit).

 

Section 8.3.                                 ERISA Compliance.

 

(a)  Borrower is not and will not be an “employee benefit plan” as defined in
Section 3(3) of the Employee Retirement Income Security Act of 1974 (“ERISA”)
that is subject to Title I of ERISA or a “plan” as defined in
Section 4975(e)(1) of the Code that is subject to Section 4975 of the Code, and
Borrower’s assets are not and will not constitute “plan assets” of one or more
such plans for purposes of Title I of ERISA or Section 4975 of the Code.

 

(b)  Borrower is not and will continue not to be a “governmental plan” within
the meaning of Section 3(32) of ERISA and transactions by or with Borrower are
not and will not be subject to any Laws regulating investments of and fiduciary
obligations with respect to governmental plans.

 

(c)  Borrower will not engage in any transaction which would cause any
obligation or any action under the Loan Documents, including Lender’s exercise
of the Remedies, to be a non-exempt prohibited transaction under ERISA.

 

Section 8.4.                                 Anti-Terrorism.

 

(a)                                 None of Borrower, Guarantor, and/or
Indemnitor or any of their respective Affiliates is in violation of any of the
Anti-Terrorism Laws, including Executive Order No. 13224 on Terrorist Financing
(effective September 24, 2001) (the “Executive Order”), the Uniting and
Strengthening America by Providing Appropriate Tools Required to Intercept and
Obstruct Terrorism Act of 2001 (Public Law 107-56), and the Bank Secrecy Act, 31
U.S.C. §5311 et seq.  Borrower covenants that neither Borrower,
Guarantor, Indemnitor nor any of their respective

 

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Affiliates will at any time during the term of the Loan be in violation of any
of the Anti-Terrorism Laws.

 

(b)                                 None of Borrower, Guarantor, and/or
Indemnitor or any of their respective Affiliates is a Prohibited Person or is in
violation of any of the Laws relating to Prohibited Persons. A “Prohibited
Person” is (A) a person designated as a “specially designated national and
blocked person” on the most current list published by the U.S. Treasury
Department Office of Foreign Assets Control at its official website
http://www.treas.gov/ofac/t11_sdn.pdf or at any replacement website or other
replacement official publication of such list, or any person or entity owned or
controlled by or acting for or on behalf of such a person; (B) an agency of the
government of a country, or an organization controlled by a country, or a person
resident in a country that is subject to trade restrictions or a sanctions
program under any of the economic sanctions of the United States administered by
the United States Department of the Treasury’s Office of Foreign Assets Control;
or (C) a person or entity (including a country or government) with whom Lender
is prohibited from dealing or otherwise engaging in any transaction by any
Anti-Terrorism Laws.  Borrower and its Affiliates will at all times comply with
all Laws relating to Prohibited Persons.

 

(c)                                  The term “Affiliate” is defined as any
person that controls, is under common control with, or is controlled by
Borrower.  For purposes of this Section 8.4, the term “control” (and derivative
terms) is defined as the power to direct or cause the direction of the
management and policies of the applicable entity through ownership of voting
securities or beneficial interests, by contract or otherwise, and persons or
entities having control include any general partner, managing member, manager or
executive officer of the applicable entity, and any direct or indirect holder of
a ten percent (10%) or greater ownership interest in Borrower,
Guarantor, Indemnitor or such applicable entity.

 

(d)                                 The Loan proceeds will not be used for any
illegal purposes and no portion of the Property or Borrower has been acquired
with funds derived from illegal activities.

 

(e)                                  Borrower covenants and agrees to deliver to
Lender any certification or other evidence requested from time to time by Lender
in its sole discretion, confirming Borrower’s compliance with this Section 8.4.
The representations and warranties set forth in said subparagraphs shall be
deemed repeated and reaffirmed by Borrower as of each date that Borrower makes a
payment to Lender under the Loan Documents or receives any payment from Lender.

 

Section 8.5.  Section 6045(e) Filing.  Borrower will supply or cause to be
supplied to Lender either (i) a copy of a completed Form 1099-B, Statement for
Recipients of Proceeds from Real Estate, Broker and Barter Exchange Proceeds
prepared by Borrower’s attorney or other person responsible for the preparation
of the form, together with a certificate from the person who prepared the form
to the effect that the form has, to the best of the preparer’s knowledge, been
accurately prepared and that the preparer will timely file the form; or (ii) a
certification from Borrower that the Loan is a refinancing of the Property or is
otherwise not required to be reported to the Internal Revenue Service pursuant
to Section 6045(e) of the Code.  Under no circumstances will Lender or Lender’s
counsel be obligated to file the reports or returns.

 

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ARTICLE IX

ENVIRONMENTAL

 

Section 9.1.  Environmental Representations and Warranties.  Except as disclosed
in the Environmental Report and to Borrower’s knowledge as of the date of this
Mortgage:

 

(a)                                 no Environmental Activity has occurred or is
occurring on the Property other than the use, storage, and disposal of Hazardous
Materials which (i) is in the ordinary course of business consistent with the
Permitted Use; (ii) is in compliance with all Environmental Laws and (iii) has
not resulted in Material Environmental Contamination of the Property; and

 

(b)                                 no Environmental Activity has occurred or is
occurring on any property in the vicinity of the Property which has resulted in
Material Environmental Contamination of the Property.

 

Section 9.2.  Environmental Covenants.

 

(a)                                 Borrower will not cause or permit any
Material Environmental Contamination of the Property.

 

(b)                                 No Environmental Activity will occur on the
Property other than the use, storage and disposal of Hazardous Materials which
(i) is in the ordinary course of business consistent with the Permitted Use;
(ii) is in compliance with all Environmental Laws; and (iii) does not create a
risk of Material Environmental Contamination of the Property.

 

(c)                                  Borrower will notify Lender immediately
upon Borrower becoming aware of (i) any Material Environmental Contamination of
the Property or (ii) any Environmental Activity with respect to the Property
that is not in accordance with the preceding subsection (b).  Borrower promptly
will deliver to Lender copies of all documents delivered to or received by
Borrower regarding the matters set forth in this subsection, including notices
of Proceedings or investigations concerning any Material Environmental
Contamination of the Property or Environmental Activity or concerning Borrower’s
status as a potentially responsible party (as defined in the Environmental
Laws).  Borrower’s notification of Lender in accordance with the provisions of
this subsection will not be deemed to excuse any default under the Loan
Documents resulting from the violation of Environmental Laws or the Material
Environmental Contamination of the Property or Environmental Activity that is
the subject of the notice.  If Borrower receives notice of a suspected violation
of Environmental Laws in the vicinity of the Property that poses a risk of
Material Environmental Contamination of the Property, Borrower will give Lender
notice and copies of any documents received relating to such suspected
violation.

 

(d)                                 From time to time at Lender’s request,
Borrower will deliver to Lender any information known and documents available to
Borrower relating to the environmental condition of the Property.

 

(e)                                  Lender may perform or engage an independent
consultant to perform an assessment of the environmental condition of the
Property and of Borrower’s compliance with this Section on an annual basis, or
at any other time for reasonable cause, or after an Event of Default.  In

 

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connection with the assessment:  (i) Lender or consultant may enter and inspect
the Property and perform tests of the air, soil, ground water and building
materials; (ii) Borrower will cooperate and use commercially reasonable efforts
to cause tenants and other occupants of the Property to cooperate with Lender or
consultant; (iii) Borrower will receive a copy of any final report prepared
after the assessment, to be delivered to Borrower not more than 10 days after
Borrower requests a copy and executes Lender’s standard confidentiality and
waiver of liability letter; (iv) Borrower will accept custody of and arrange for
lawful disposal of any Hazardous Materials required to be disposed of as a
result of the tests; (v) Lender will not have liability to Borrower with respect
to the results of the assessment; and (vi) Lender will not be responsible for
any damage to the Property resulting from the tests described in this subsection
and Borrower will look solely to the consultants to reimburse Borrower for any
such damage.  The consultant’s assessment and reports will be at Borrower’s
expense (x) if the reports disclose any material adverse change in the
environmental condition of the Property from that disclosed in the Environmental
Report; (y) if Lender engaged the consultant when Lender had reasonable cause to
believe Borrower was not in compliance with the terms of this Article and, after
written notice from Lender, Borrower failed to provide promptly reasonable
evidence that Borrower is in compliance; or (z) if Lender engaged the consultant
after the occurrence of an Event of Default.

 

(f)                                   If Lender has reasonable cause to believe
that there is Environmental Activity at the Property, Lender may elect in its
sole discretion to release from the lien of this Mortgage any portion of the
Property affected by the Environmental Activity and Borrower will accept the
release.

 

ARTICLE X

FINANCIAL REPORTING

 

Section 10.1.  Financial Reporting.

 

(a)                                 Borrower will deliver to Lender within 90
days after the close of each Fiscal Year (together with any change to the
previously submitted Budget and, if and as applicable, Leasing Plan), an annual
financial statement (the “Annual Financial Statement”) for the Property for the
prior Fiscal Year, which will include a comparative balance sheet, an income and
expense statement on a GAAP basis, including operating and capital expenditures
and leasing costs, and if requested, all supporting schedules.  The Annual
Financial Statement will be:

 

(i)                                     certified by Borrower prior to any Event
of Default and following any Event of Default audited by a CPA and accompanied
by an opinion of the CPA that, in all material respects, the Annual Financial
Statement fairly presents the financial position of the Property; and

 

(ii)                                  separate and distinct from any
consolidated statement or report for Borrower or any other entity or any other
property.

 

(b)                                 Simultaneously with the delivery of the
Annual Financial Statement, Borrower will deliver to Lender the Certification of
Rent Roll as required by the Assignment of Leases and Rents.

 

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(c)                                  Borrower will keep full and accurate
Financial Books and Records for each Fiscal Year.  Borrower will permit Lender
or Lender’s accountants or auditors to inspect or audit the Financial Books and
Records from time to time and without notice.  Borrower will maintain the
Financial Books and Records for each Fiscal Year for not less than 3 years after
the date Borrower delivers to Lender the Annual Financial Statement and the
other financial certificates, statements and information to be delivered to
Lender for the Fiscal Year.  Financial Books and Records will be maintained at
Borrower’s address set forth in the section entitled “Notices” or at any other
location as may be approved by Lender.

 

(d)                                 Borrower will (i) provide Lender with a copy
of any “Annual Limited Dividend Financial Report” submitted in connection with
the Regulatory Agreement (with each such copy being provided to Lender
simultaneous with the submission of such report to the MHPFB), (ii) will provide
Lender with a copy of any response from the MHPFB relative to the report
referenced in the preceding item (i) (with each such copy being provided to
Lender within five (5) Business Days of Borrower’s receipt of the same from
MHPFB), (iii) provide Lender with a copy of (A) any notice of default or inquiry
regarding compliance with the Regulatory Agreement that may be issued by the
MHPFB under or in connection with the Regulatory Agreement and (B) the results
of any annual inspection performed by MHPFB under the Regulatory Agreement 
(with each such copy referenced in this item (iii), being provided to Lender
within five (5) Business Days of Borrower’s receipt of the same from MHPFB). 
Additionally, Borrower shall (1) promptly notify Lender of any re-determination
of Borrower’s Equity as defined in the Regulatory Agreement, and (2) provide
Lender with any written submission Borrower may make or intend to make in
connection with any such re-determination prior to submitting the same to
MHPFB.  Furthermore, prior to submitting the same to the MHPFB, Borrower shall
provide a copy of any revisions to the affirmative marketing plan referenced in
Section 7 of the Regulatory Agreement and copies of any written response from
the MHPFB with respect to the same (with each such copy of any such response
being provided to Lender within five (5) Business Days of Borrower’s receipt of
the same from MHPFB).

 

Section 10.2  Interim Financial Information and Rent Roll.

 

(a)                                 Upon request by Lender, Borrower will
deliver to Lender within 30 days after the end of each quarter (i) GAAP basis
income and expense statements for the Property for the immediately preceding
fiscal quarter, as well as for the year-to-date (ii) a current Rent Roll for the
Property and (iv) any changes to the Budget and, if and as applicable, Leasing
Plan, it being understood and agreed that, if so requested by Lender, each item
required to be delivered pursuant to this clause (a) shall be accompanied by a
certification from Borrower confirming that the information so delivered is
true, correct and complete in all material respects;

 

(b)                                 Upon Lender’s request, simultaneously with
the delivery of the quarterly financial information required under clause
(a) above, Borrower will deliver to Lender a certificate disclosing any
contracts with affiliates of Borrower in connection with the Property; and

 

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(c)                                  Borrower will deliver to Lender any other
information with respect to the operation and management of Borrower and
Property as Lender may request from time to time within 15 days of the request.

 

Section 10.3.                          Annual Budget.

 

(a)                                 Not less than 60 days prior to the end of
each Fiscal Year, Borrower will deliver to Lender a detailed comparative budget
(the “Budget”) for the Property for the then current and succeeding Fiscal Year
showing anticipated Rents and Operating Expenses, including projected capital
and tenant improvement costs, and any other information Lender requests; and

 

(b)                                 Following the occurrence of an Event of
Default and/or in the event the Debt Service Coverage Ratio as determined by
Lender (based on a 30 year amortization schedule) shall at any time decline
below 1.10 : 1.00 for a period of three (3) consecutive calendar months,
Borrower shall (within sixty (60) days of Lender’s notice to Borrower of such
Event of Default or such decline in the Debt Service Coverage Ratio) deliver to
Lender for Lender’s review and approval a lease rollover schedule for the
current and subsequent two Fiscal Years, a marketing plan (if applicable), and a
leasing plan (collectively, the “Leasing Plan”) for the Property, which shall
include projected market rents, a marketing plan and projections for rollover
spaces, vacancies, leasing commissions, tenant improvement costs and other
capital costs in the Property.  Additionally, from and after the date of
delivery of the initial Leasing Plan, not less than 60 days prior to the end of
each Fiscal Year, Borrower shall deliver to Lender for Lender’s review and
approval an updated Leasing Plan for the subsequent two Fiscal Years.

 

(c)                                  Without limiting the foregoing or any other
provisions set forth herein and in the other Loan Documents, (i) during any Low
DSCR Period, Borrower shall submit a monthly leasing report to Lender in form
and substance acceptable to Lender detailing all leasing activity in connection
with the Property and (ii) during an Event of Default Borrower shall deliver to
Lender a monthly update to the Leasing Report for Lender’s review and approval.

 

(d)                                 Borrower waives any defense or right of
offset to the Obligations, and any claim or counterclaim against Lender, arising
out of any discussions between Borrower and Lender regarding any Budget or
revised Budget delivered to Lender, including any defense, right of offset,
claim or counterclaim alleging in substance, that by virtue of such delivery,
discussions or resolution, Lender has interfered with, influenced or controlled
Borrower or the operations at the Property.

 

Section 10.4.  Material Non-Public Information. Prior to delivering any
information that may constitute material non-public information with respect to
a company whose shares are publicly traded, Borrower shall endeavor to notify
Lender in advance of any such proposed delivery, it being understood and agreed,
however, that any breach of this provision by Borrower shall not constitute a
default or Event of Default hereunder.

 

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ARTICLE XI

EXPENSES AND DUTY TO DEFEND

 

Section 11.1.  Payment of Expenses.

 

(a)  Borrower is obligated to pay all fees and expenses (the “Expenses”) that
are (i) incurred by Lender in respect of the Loan, any Loan Document, the
Property or Borrower; (ii) charged by Lender in consideration of processing any
request by or on behalf of Borrower for an action or consent of Lender under the
Loan Documents, which charges will be determined by Lender in its reasonable
discretion; or (iii) are otherwise payable in connection with the Loan, the
Property or Borrower, including attorneys’ fees and expenses and any fees and
expenses relating to (A) the preparation, execution, acknowledgment, delivery
and recording or filing of the Loan Documents; (B) any Proceeding or other claim
asserted against Lender or any Proceeding described in the Section entitled
“Lender’s Right to Appear”; (C) any inspection, assessment, survey and test
permitted under the Loan Documents (unless and to the extent the Loan Documents
expressly provide that the same are either not payable by Borrower or payable by
Lender); (D) any Destruction Event; (E) the preservation of Lender’s security
and the exercise of any rights or remedies available at Law, in equity or
otherwise; (F) administration of the Loan; (G) any review, consent or other
servicing matter relating to the Leases and the Property Documents; and (H) any
Proceeding in or for bankruptcy, insolvency, reorganization or other debtor
relief or similar Proceeding relating to Borrower, the Property or any person
liable under any guarantee, indemnity or other credit enhancement delivered in
connection with the Loan.

 

(b)  Borrower will pay the Expenses immediately on demand, together with any
applicable interest, premiums or penalties.  If Lender pays any of the Expenses,
Borrower will reimburse Lender the amount paid by Lender immediately upon
demand, together with interest on such amount at the Default Interest Rate from
the date Lender paid the Expenses through and including the date Borrower
reimburses Lender.  The Expenses together with any applicable interest, premiums
or penalties constitute a portion of the Debt secured by this Mortgage.

 

Section 11.2.                          Duty to Defend.  If Lender or any of its
trustees, officers, participants, employees or affiliates is a party in any
Proceeding relating to the Property, Borrower or the Loan, Borrower will
indemnify and hold harmless the party and will defend the party with attorneys
and other professionals retained by Borrower and approved by Lender (provided
that Borrower shall not be required to so indemnify, defend and hold harmless
Lender and/or such party(ies) as and to the extent the Proceeding is resultant
from Lender’s gross negligence or willful misconduct).  Lender may elect to
engage its own attorneys and other professionals, at Borrower’s expense, to
defend or to assist in the defense of the party.  In all events, case strategy
will be determined by Lender if Lender so elects and no Proceeding will be
settled without Lender’s prior approval which may be withheld in its sole
discretion.

 

ARTICLE XII

TRANSFERS, LIENS AND ENCUMBRANCES

 

Section 12.1.  Prohibitions on Transfers, Liens and Encumbrances.

 

(a)  Borrower acknowledges that in making the Loan, Lender is relying to a
material extent on the business expertise and net worth of Borrower and
Borrower’s general partners, members or

 

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principals and on the continuing interest that each of them has, directly or
indirectly, in the Property.  Accordingly, except as specifically set forth in
this Mortgage, Borrower (i) will not, and will not permit its partners, members
or principals to, effect a Transfer without Lender’s prior approval, which may
be withheld in Lender’s sole discretion and (ii) will keep the Property free
from all liens and encumbrances other than the lien of this Mortgage and the
Permitted Exceptions.  A “Transfer” is defined as any sale, grant, lease (other
than bona fide third-party space leases with tenants), conveyance, assignment or
other transfer of, or any encumbrance or pledge against, the Property, any
interest in the Property, any interest of Borrower’s partners, members or
principals in the Property, or any change in Borrower’s composition, in each
instance whether voluntary or involuntary, direct or indirect, by operation of
law or otherwise (including mergers affecting any constituent entity) and
including the grant of an option or the execution of an agreement relating to
any of the foregoing matters (provided that a Transfer shall not include any
Permitted Exception).

 

(b)  Borrower represents, warrants and covenants that:

 

(i)                                     Borrower is a Delaware limited liability
company whose manager is NewReal, Inc., a Massachusetts corporation (“Manager”),
and whose sole member is Nashoba Apartments Limited Partnership, a Massachusetts
limited partnership (the “Existing Member”);

 

(ii)                                  Manager is a Massachusetts corporation the
equity interests in which are held by Harold Brown, the owner of 75% of the
equity interests in Manager, and Ronald Brown, the owner of 25% of the equity
interests in Manager;

 

(iii)                               Existing Member is a Massachusetts limited
partnership, the equity interests in which are held by New England Realty
Associates Limited Partnership, a Massachusetts limited partnership (“NERA”),
the sole limited partner in Existing Member and the owner of 99% of the limited
partnership interests in Existing Member, and Nashoba Apartments, Inc, a
Massachusetts corporation (“Existing Member GP”), the sole general partner of
Existing Member and the owner of the remaining 1% of the limited partnership
interests in Existing Member;

 

(iv)                              Existing Member GP is a Massachusetts
corporation, with NERA being the owner of 100% of the equity interests in
Existing Member; and

 

(v)                                 NERA is a Massachusetts limited partnership,
the general partner of which is Manager holding 1% of the equity interests in
NERA, with 80% of the remaining equity interests in NERA being held by the
holders of certain Class A interests in NERA (which Class A interests are
publicly traded) and the remaining 19% of the equity interests in NERA being
held by the holders of certain Class B interests in NERA (which Class B
interests are held by Manager).

 

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Section 12.2.  Permitted Transfers.

 

(a)  Notwithstanding the prohibitions regarding Transfers, a Permitted Transfer
may occur without Lender’s prior consent, provided that the following conditions
are met:

 

(i)                                     at least 45 days prior to the proposed
Permitted Transfer, Borrower delivers to Lender a notice that is sufficiently
detailed to enable Lender to determine that the proposed Permitted Transfer
complies with the terms of this Section;

 

(ii)                                  there is no default under the Loan
Documents either when Lender receives the notice or when the proposed Permitted
Transfer occurs and all payment obligations of Borrower to Lender have been paid
through the date of the Permitted Transfer;

 

(iii)                               the proposed Permitted Transfer will not
result in a violation of any of the covenants or representations contained in
the Sections entitled “ERISA Compliance”, “Anti-Terrorism” or “Special Purpose
Entity Representations, Warranties and Covenants” and Borrower will deliver to
Lender such documentation of compliance as Lender requests in its sole
discretion;

 

(iv)                              when Lender receives the notice and when the
proposed Permitted Transfer occurs, the transferee has never been an adverse
party to Lender in any litigation to which Lender was a party; the transferee
has never defaulted on a loan from Lender or on any contract or other agreement
with Lender; and the transferee has never threatened litigation against Lender
(for purposes of this subsection, “transferee” includes the transferee’s
constituent entities at all levels and “Lender” includes Lender’s subsidiaries);

 

(v)                                 Borrower pays all of Lender’s expenses
relating to the Transfer, including Lender’s attorneys’ fees;

 

(vi)                              Lender is satisfied that the Property will
continue to be managed by a property manager satisfactory to Lender;

 

(vii)                           On the date of the proposed Permitted Transfer,
if so requested by Lender, a Uniform Commercial Code search report is delivered
to Lender relating to (A) the transferee, (B) any predecessor entity that
transferee merged with or into, and (C) any entity where transferee acquired
substantially all of its assets, in each case satisfactory to Lender and
indicating that Lender’s security interest in such portion of the Property as is
perfected by filing a financing statement is prior to all other security
interests reflected in the report; and

 

(viii)                        On the date of the proposed Permitted Transfer,
Lender receives certifications, satisfactory to Lender, that the proposed
Permitted Transfer complies with this Section.

 

(b)  Upon compliance with the conditions set forth in the preceding subsection,
the following Transfers (the “Permitted Transfers”) may occur without Lender’s
prior consent:

 

(i)                                     any Transfer of direct or indirect
ownership interests in Borrower; provided that, subsequent to the Transfer NERA
(NERA in such capacity, the “Key Principal”)

 

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retains Control of Borrower and owns not less than twenty five percent (25%) of
the economic interests in Borrower;

 

(ii)                                  any Transfer of publicly traded shares in
NERA, provided that following such Transfer, (A) Harold Brown (i.e. the Vice
President of the Manager as of the date of this Mortgage), Ronald Brown (i.e.
the President of the Manager as of the date of this Mortgage) and/or one or more
Family Members shall retain Control of NERA and (B) NERA shall retain Control of
Borrower and own not less than twenty-five percent (25%) of the economic
interests in Borrower.  As used herein, the term “Family Member” means a spouse,
child or grandchild of said Harold Brown, said Ronald Brown or any trust
established for the benefit of any one or more of the foregoing;

 

(iii)                               a one-time sale (a “One-Time Sale”) of the
Property to an unaffiliated bona fide purchaser, provided that Lender has
declined to exercise any right to purchase the Property Lender may have pursuant
to an express provision in this Mortgage and the following conditions are met:

 

(A)                               the transferee or its sponsor has a net worth
of at least $50,000,000.00;

 

(B)                               the transferee is an Institutional Investor or
a developer or manager of first-class commercial real estate comparable to the
Property, having substantial experience in owning property that is subject to
affordable housing requirements, and having a reputation in the industry at
least equivalent to that of Borrower as of the date of this Mortgage;

 

(C)                               the transferee has expressly assumed the
obligations of Borrower under the Property Documents and under the Loan
Documents; and

 

(D)                               subsequent to the One-Time Sale, the Property
is managed by a property manager satisfactory to Lender;

 

(E)                                Lender, in its sole discretion, may require
evidence satisfactory to it that immediately prior to the One-Time Sale and at
least twelve (12) months subsequent to the One-Time Sale, the Property supports
a loan to value ratio no greater than 70% and a Debt Service Coverage of not
less than 1.25 : 1.00;

 

(F)                                 Borrower pays to Lender a transfer fee of
not less than one-half of one percent (0.50%) of the outstanding Principal.

 

(G)                               Borrower delivers to Lender a substitute for
the environmental indemnity and recourse carveout guaranty delivered to Lender
in connection with the Loan, executed by a substitute indemnitor, guarantor or
surety, as the case may be, satisfactory to Lender in its sole discretion (which
substitution agreement shall provide for the release of the existing
guarantor(s) and/or indemnitor(s) from obligations thereunder as and to the
extent the same first arise after the date on which the Property is transferred
to the transferee and the same arise as a result of

 

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acts or omissions that such such guarantor(s) and/or indemnitor(s) had no
involvement with nor ability to direct or control the actions of others; in all
events upon terms and conditions acceptable to Lender); and

 

(H)                              Lender’s receipt of a non-consolidation opinion
in form and substance acceptable to Lender in Lender’s sole discretion.

 

(c )                               Notwithstanding anything to the contrary set
forth herein:  (i) upon compliance with terms set forth in the Assignment,
Borrower may enter into leases of the Property for the Permitted Use thereof and
(ii) Lender shall not unreasonably withhold its consent to the approval of any
private utility or other operational easement in the event that (A) no Event of
Default has occurred and is then continuing and (B) Lender is satisfied based on
documentation provided by Borrower that such restriction will not have an
adverse effect on the use or value of the Property or the priority of the lien
of this Mortgage.

 

Section 12.3.  Right to Contest Liens.  Borrower, at its own expense, may
contest the amount, validity or application, in whole or in part, of any
mechanic’s, materialmen’s or environmental liens in which event Lender will
refrain from exercising any of the Remedies, provided that the following
conditions are met:

 

(i)                                     Borrower delivers to Lender notice of
the proposed contest not more than 30 days after the lien is filed;

 

(ii)                                  the contest is by a Proceeding promptly
initiated and conducted in good faith and with due diligence;

 

(iii)                               there is no Event of Default other than the
Event of Default arising from the filing of the lien;

 

(iv)                              the Proceeding suspends enforcement or
collection of the lien, imposition of criminal or civil penalties and sale or
forfeiture of the Property and Lender will not be subject to any civil suit;

 

(v)                                 the Proceeding is permitted under and is
conducted in accordance with the Leases and the Property Documents;

 

(vi)                              Borrower sets aside reserves or furnishes a
bond or other security satisfactory to Lender, in either case in an amount
sufficient to pay the claim giving rise to the lien, together with all interest
and penalties, or Borrower pays the contested lien under protest; and

 

(vii)                           with respect to an environmental lien, Borrower
is using best efforts to mitigate or prevent any deterioration of the Property
resulting from the alleged violation of any Environmental Laws or the alleged
Environmental Activity.

 

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Section 12.4.  Death or Incapacity of Guarantor or Indemnitor.

 

If any Guarantor or Indemnitor is an individual, such individual’s death or
legal incapacity shall constitute an Event of Default hereunder if within
ninety(90) days of such individual’s death or incapacity, the obligations of
such individual under any guaranty or indemnity made in connection with the Loan
is not transferred to a substitute Guarantor and/or Indemnitor proposed by
Borrower and approved by Lender in its sole discretion, it being understood and
agreed that all of the conditions set forth in Section 12.2 (a) (iii), (iv),
(v), (vii) and (viii) must be satisfied with respect to such transfer, and that
any such substitute guarantor and/or indemnitor proposed by Borrower must:

 

(i)                                     have a net worth of at least
$50,000,000.00;

 

(ii)                                  have a beneficial interest in Borrower;
and

 

(iii)                               expressly assume the obligations of
Guarantor and/or Indemnitor, as applicable under any guaranty or indemnity
entered into in connection with the Loan.

 

In lieu of a substitute Indemnitor under the environmental indemnity delivered
in connection with the Loan, Lender may elect to accept environmental insurance,
in its sole discretion.

 

ARTICLE XIII

ADDITIONAL REPRESENTATIONS, WARRANTIES AND COVENANTS

 

Section 13.1.  Further Assurances.

 

(a)  Borrower will execute, acknowledge and deliver to Lender, or to any other
entity Lender designates, any additional or replacement documents and perform
any additional actions that Lender determines are reasonably necessary to
evidence, perfect or protect Lender’s first lien on and prior security interest
in the Property or to carry out the intent or facilitate the performance of the
provisions of the Loan Documents.

 

(b)  Borrower appoints Lender as Borrower’s attorney-in-fact to perform, at
Lender’s election, any actions and to execute and record any of the additional
or replacement documents referred to in this Section, in each instance only at
Lender’s election and only to the extent Borrower has failed to comply with the
terms of this Section.

 

Section 13.2.  Estoppel Certificates.

 

(a)  Within 10 days of Lender’s request, Borrower will deliver to Lender, or to
any entity Lender designates, a certificate certifying (i) the original
principal amount of the Note; (ii) the unpaid principal amount of the Note;
(iii) the Fixed Interest Rate; (iv) the amount of the then current Debt Service
Payments; (v) the Maturity Date; (vi) the date a Debt Service Payment was last
made; (vii) that, except as may be disclosed in the statement, there are no
defaults or events which, with the passage of time or the giving of notice,
would constitute an Event of Default; and (viii) there are no offsets or
defenses against any portion of the Obligations except as may be disclosed in
the statement.

 

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(b) If Lender requests, Borrower promptly will deliver to Lender or to any
entity Lender designates a certificate from each party to any Property Document,
certifying that the Property Document is in full force and effect with no
defaults or events which, with the passage of time or the giving of notice,
would constitute an event of default under the Property Document and that there
are no defenses or offsets against the performance of its obligations under the
Property Document.

 

Section 13.3.  Special Purpose Entity Representations, Warranties and Covenants.
.

 

Borrower covenants and agrees as follows:

 

(a)                                 Borrower is formed solely for the purpose of
owning and operating the Property and is not engaged and will not engage, either
directly or indirectly, in any business other than the ownership, management and
operation of the Property;

 

(b)                                 Borrower does not have and will not acquire
or use any assets other than the Property and personal property incidental to
the business of owning and operating the Property and activities incidental
thereto; without limiting the foregoing, the Property shall be operated as a
single property or project, generating substantially all of Borrower’s gross
income, it being the intent that the Property shall constitute “single asset
real estate” for purposes of Section 362(d)(3) of the Bankruptcy Code;

 

(c)                                  Borrower will not liquidate or dissolve (or
suffer any liquidation or dissolution), or enter into any transaction of merger
or consolidation, or acquire by purchase or otherwise all or substantially all
the business or assets of, or any stock or other evidence of beneficial
ownership of any entity;

 

(d)                                 Borrower will not, nor will any partner,
limited or general, member or shareholder thereof, as applicable, violate the
terms of its partnership certificate, partnership agreement, articles of
incorporation, by-laws, operating agreement, articles of organization, or other
formation agreement or document, as applicable;

 

(e)                                  Borrower will observe all limited liability
company, limited partnership or general partnership formalities that relate to
the Borrower’s separateness pursuant to its formation documents, operating
agreement, bylaws or partnership agreement (as the case may be), or any other
organizational filing or document governing the affairs of the Borrower;

 

(f)                                   Borrower has not and will not guarantee,
pledge its assets for the benefit of, or otherwise become obligated for the
obligations of any other person or hold out its credit or assets as being
available to satisfy the obligations of any other person except for obligations
for indemnification and other obligations of the Borrower pursuant to its
operating agreement, bylaws, or partnership agreement, as applicable;

 

(g)                                  Borrower has not incurred and will not
incur any debt, secured or unsecured, direct or contingent (including
guaranteeing any obligation), other than (i) the Loan and (ii) unsecured trade
debt incurred in the ordinary course of Borrower’s business in connection with
owning,

 

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operating and maintaining the Property, not evidenced by a note, and payable
within ninety (90) days of the date incurred;

 

(h)                                 Borrower will be and will at all times hold
itself out to the public as a legal entity separate and distinct from any other
entity (including, without limitation, any affiliate, limited partner, general
partner or member, as applicable, or any affiliate of any limited partner,
general partner or member of Borrower, as applicable), will correct any known
misunderstanding concerning its separate identity, and will not identify any
other entity (including, without limitation, any affiliate, limited partner,
general partner or member, or any affiliate of any limited partner, general
partner or member of Borrower, as applicable) as a division or part of Borrower;

 

(i)                                     Subject to the management of the
Property by the property manager using a single operating account and to the
commingling of reserves and other funds held by Lender as required under the
Loan Documents, Borrower will not commingle its funds or assets with those of
any other person, and will maintain and account for its assets in such a manner
that it will not be costly or difficult to segregate, ascertain or identify its
individual assets from those of any other person;

 

(j)                                    Borrower will maintain its own separate,
complete and accurate accounts, books, records and financial statements
complying with GAAP, provided that the Borrower may file or may be part of a
consolidated federal tax return to the extent required or permitted by
applicable law so long as there is an appropriate notation indicating the
separate existence of the Borrower and its assets and liabilities;

 

(k)                                 Borrower will maintain its books, records,
resolutions and agreement as official records;

 

(l)                                     Borrower will pay its obligations and
expenses from its own funds and assets (to the extent that it has funds to do
so);

 

(m)                             Borrower will not have any paid manager or
director for the entity (other than the Independent Manager) and to the extent
Borrower has any employees, Borrower will pay the salaries of its own employees
from its own funds and in the absence of such paid employees, Borrower will
obtain all necessary services through third parties or independent contractors;

 

(n)                                 Borrower will conduct and operate business
in its own name or in the name of the Property, will allocate fairly and
reasonably any overhead for shared office space and use separate stationery,
invoices and checks;

 

(o)                                 Borrower will not enter into or be a party
to any transaction with any limited partner, general partner, principal,
affiliate or member of Borrower, as applicable, or any affiliate of any limited
partner, general partner, principal or member of Borrower, except in the
ordinary course of business and upon terms and conditions that are intrinsically
fair and substantially similar to those that would be available on an
arms-length basis with third parties other than an affiliate;

 

(p)                                 Borrower will not make loans or advance
credit to any person (including affiliates) other than to tenants of the
Property in the form of tenant allowances or tenant improvements;

 

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(q)                                 Borrower will not take any action which,
under the terms of any formation document or other applicable organizational
documents, requires the unanimous consent of all directors, partners or members,
as applicable, without such required vote;

 

(r)                                    Borrower will not engage in, seek or
consent to any dissolution, winding up, liquidation, consolidation, merger,
asset sale, bankruptcy or insolvency filing, or material amendment to or
modification (including without limitation to any amendments or modifications of
Borrower’s separateness covenants) of its partnership agreement, articles of
incorporation, by-laws, operating agreement, articles of organization, or other
formation agreement or document, as applicable, without the required written
consent of Lender;

 

(s)                                   Borrower will continue to operate its
business with the goal of maintaining capital which is adequate for the normal
obligations reasonably foreseeable in a business of its size and character and
in light of its contemplated business operations to the extent funds are
available from the Property;

 

(t)                                    Borrower will have organizational
documents that provide (a) that, regardless of the solvency of the Borrower, the
Independent Manager shall owe duties to protect creditors in the enforcement of
their contractual rights, including, without limitation, all remedies, and
(b) that Lender is an intended third-party beneficiary of such organizational
documents;  and/or

 

(u)                                 Borrower will not fail at any time to have
at least one (1) Independent Manager that will vote on any Material Action (as
hereinafter defined) of the Borrower. As used herein, “Material Action” shall be
deemed to be (a) any proposed insolvency or bankruptcy proceeding of Borrower,
(b) any dissolution or liquidation of Borrower, and/or (c) any amendment or
modification of any provision of Borrower’s organizational documents relating to
company purpose or Borrower’s bankruptcy-remote status, provided that the
affirmative vote or written consent of the Independent Manager shall be required
for the Borrower to approve or take any Material Action.  No termination or
change of the Independent Manager shall be made without giving Lender at least
20 days’ prior written notice, which notice shall include a copy of a resume for
such proposed replacement Independent Manager that reflects that such individual
meets the definition of Independent Manager contained herein; provided further,
that Lender shall have the right to object to the appointment of said
replacement Independent Manager and in the event of such objection, the proposed
replacement Independent Manager shall not be admitted.  Notwithstanding the
foregoing, any current Independent Manager that receives notice of the
termination of its duties as such Independent Manager shall provide a copy of
said notice to Lender within 5 days of receipt thereof.

 

Borrower agrees to keep the Single Purpose Entity covenants set forth in this
Section 13.3 and such covenants currently are and will continue to be defined
within Borrower’s partnership certificate, partnership agreement, articles of
incorporation, by-laws, operating agreement, articles of organization, or any
other organizational filing or document governing the affairs of Borrower.

 

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ARTICLE XIV

DEFAULTS AND REMEDIES

 

Section 14.1.  Events of Default.   The term “Event of Default” means the
occurrence of any of the following events:

 

(i)                                     if Borrower fails to pay (a) the
Principal and all other amounts due under the Loan on the Maturity Date, (b) any
Debt Service Payment and/or any monthly installment payment or deposit due under
the Tax Pledge, the Replacement Reserve Pledge or any other pledge or reserve
agreement established in connection with the Loan, as and when such amounts
described under this clause (b) are required to be paid under any Loan Document,
and such failure continues for a period of 5 days or (c) any other amounts not
specifically identified in the preceding clauses (a) and (b) of this item (i),
as and when such other amounts described under this clause (c) are required to
be paid under any Loan Document, and such failure continues for a period of 5
days after written notice to Borrower thereof;

 

(ii)                                  if Borrower makes a general assignment for
the benefit of creditors or generally is not paying, or is unable to pay, or
admits in writing its inability to pay, its debts as they become due; or if
Borrower or any other party commences any Proceeding (A) relating to bankruptcy,
insolvency, reorganization, conservatorship or relief of debtors, in each
instance with respect to Borrower; (B) seeking to have an order for relief
entered with respect to Borrower; (C) seeking attachment, distraint or execution
of a judgment with respect to Borrower; (D) seeking to adjudicate Borrower as
bankrupt or insolvent; (E) seeking reorganization, arrangement, adjustment,
winding-up, liquidation, dissolution, composition or other relief with respect
to Borrower or Borrower’s debts; or (F) seeking appointment of a Receiver,
trustee, custodian, conservator or other similar official for Borrower or for
all or any substantial part of Borrower’s assets, provided that if the
Proceeding is commenced by a party other than Borrower or any of Borrower’s
general partners or members, Borrower will have 120 days to have the Proceeding
dismissed or discharged before an Event of Default occurs;

 

(iii)                               if Borrower is in default beyond any
applicable grace and cure period under any other mortgage, deed of trust, deed
to secure debt or other security agreement encumbering the Property whether
junior or senior to the lien of this mortgage;

 

(iv)                              if there is a default beyond any applicable
grace and cure period under any indemnity or guaranty in favor of Lender
delivered to Lender in connection with the Loan or in connection with any loan
cross-collateralized with the Loan;

 

(v)                                 if a Transfer occurs except in accordance
with the provisions of this Mortgage;

 

(vi)                              if Borrower abandons the Property or ceases to
conduct its business at the Property;

 

(vii)                           if there is a default in the performance of any
other provision of any Loan Document or if there is any inaccuracy or falsehood
in any representation or warranty contained in any Loan Document or any
indemnity or guaranty in favor of Lender delivered to Lender in connection with
the Loan or in connection with any loan cross-collateralized

 

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with the Loan, which is not remedied within 30 days after Borrower receives
notice thereof, provided that if the default, inaccuracy or falsehood is of a
nature that it cannot be cured within the 30-day period and during that period
Borrower commences to cure, and thereafter diligently continues to cure, the
default, inaccuracy or falsehood, then the 30-day period will be extended for a
reasonable period not to exceed 120 days after the notice to Borrower; or

 

(viii)                        if Borrower violates any covenant contained within
Section 13.3 entitled “Special Purpose Entity Representations, Warranties and
Covenants”.

 

Section 14.2.  Remedies.

 

(a)  If an Event of Default occurs, Lender may take any of the following actions
(the “Remedies”) without notice to Borrower:

 

(i)                                     declare all or any portion of the Debt
immediately due and payable (“Acceleration”);

 

(ii)                                  pay or perform any Obligation;

 

(iii)                               institute a Proceeding for the specific
performance of any Obligation;

 

(iv)                              apply for and obtain the appointment of a
Receiver to be vested with the fullest powers permitted by Law, without bond
being required, which appointment may be made ex parte, as a matter of right and
without regard to the value of the Property, the amount of the Debt or the
solvency of Borrower or any other person liable for the payment or performance
of any portion of the Obligations;

 

(v)                                 directly, by its agents or representatives
or through a Receiver appointed by a court of competent jurisdiction, enter on
the Land and Improvements, take possession of the Property, dispossess Borrower
and exercise Borrower’s rights with respect to the Property, either in
Borrower’s name or otherwise;

 

(vi)                              institute a Proceeding for the foreclosure of
this Mortgage or, if applicable, sell by power of sale, all or any portion of
the Property;

 

(vii)                           institute proceedings for the partial
foreclosure of this Mortgage for the portion of the Debt then due and payable,
subject to the continuing lien of this Mortgage for the balance of the Debt not
then due;

 

(viii)                        exercise any and all rights and remedies granted
to a secured party under the Uniform Commercial Code; and

 

(ix)                              pursue any other right or remedy available to
Lender at Law, in equity or otherwise.

 

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(b)  If an Event of Default occurs, the license granted to Borrower in the Loan
Documents to collect Rents will terminate automatically without any action
required of Lender.

 

Section 14.3.                          General Provisions Pertaining to
Remedies.

 

(a)  The Remedies are cumulative and may be pursued concurrently or otherwise,
at such time and in such order as Lender may determine in its sole discretion
and without presentment, demand, protest or further notice of any kind, all of
which are expressly waived by Borrower.

 

(b) The enumeration in the Loan Documents of specific rights or powers will not
be construed to limit any general rights or powers or impair Lender’s rights
with respect to the Remedies.

 

(c)  If Lender exercises any of the Remedies, Lender will not be deemed a
mortgagee-in-possession unless Lender has elected affirmatively to be a
mortgagee-in-possession.

 

(d)  Lender will not be liable for any act or omission of Lender in connection
with the exercise of the Remedies.

 

(e)  Lender’s right to exercise any Remedy will not be impaired by any delay in
exercising or failure to exercise the Remedy and the delay or failure will not
be construed as extending any cure period or constitute a waiver of the default
or Event of Default.

 

(f)  If an Event of Default occurs, Lender’s payment or performance or
acceptance of payment or performance will not be deemed a waiver or cure of the
Event of Default.

 

(g)  Lender’s acceptance of partial payment or receipt of Rents will not extend
or affect any grace period, constitute a waiver of a default or Event of Default
or constitute a rescission of Acceleration.

 

Section 14.4.                          General Provisions Pertaining to Receiver
and other Remedies.

 

(a)  If an Event of Default occurs, any court of competent jurisdiction will,
upon application by Lender, appoint a Receiver as designated in the application
and issue an injunction prohibiting Borrower from interfering with the Receiver,
collecting Rents, disposing of any Rents or any part of the Property, committing
waste or doing any other act that will tend to affect the preservation of the
Leases, the Rents and the Property and Borrower approves the appointment of the
designated Receiver or any other Receiver appointed by the court.  Borrower
agrees that the appointment may be made ex parte and as a matter of right to
Lender, either before or after sale of the Property, without further notice, and
without regard to the solvency or insolvency, at the time of application for the
Receiver, of the person or persons, if any, liable for the payment of any
portion of the Debt and the performance of any portion of the Obligations and
without regard to the value of the Property or whether the Property is occupied
as a homestead and without bond being required of the applicant.

 

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(b)  The Receiver will be vested with the fullest powers permitted by Law
including all powers necessary or usual in similar cases for the protection,
possession and operation of the Property and all the powers and duties of Lender
as a mortgagee-in-possession as provided in this Mortgage and may continue to
exercise all the usual powers and duties until the Receiver is discharged by the
court.

 

(c)  In addition to the Remedies and all other available rights, Lender or the
Receiver may take any of the following actions:

 

(i)                                     take exclusive possession, custody and
control of the Property and manage the Property so as to prevent waste;

 

(ii)                                  require Borrower to deliver to Lender or
the Receiver all keys, security deposits, operating accounts, prepaid Rents,
past due Rents, the Financial Books and Records and all original counterparts of
the Leases and the Property Documents;

 

(iii)                               collect, sue for and give receipts for the
Rents and, after paying all expenses of collection, including reasonable
receiver’s, broker’s and attorney’s fees, apply the net collections to any
portion of the Debt selected by Lender in its sole discretion;

 

(iv)                              enter into, modify, extend, enforce,
terminate, renew or accept surrender of Leases and evict tenants except that in
the case of a Receiver, such actions may be taken only with the written consent
of Lender as provided in this Mortgage and in the Assignment;

 

(v)                                 enter into, modify, extend, enforce,
terminate or renew Property Documents except that in the case of a Receiver,
such actions may be taken only with the written consent of Lender as provided in
this Mortgage and in the Assignment;

 

(vi)                              appear in and defend any Proceeding brought in
connection with the Property and bring any Proceeding to protect the Property as
well as Borrower’s and Lender’s respective interests in the Property (unless any
such Proceeding has been assigned previously to Lender in the Assignment, or if
so assigned, Lender has not expressly assigned such Proceeding to the Receiver
and consented to such appearance or defense by the Receiver); and

 

(vii)                           perform any act in the place of Borrower that
Lender or the Receiver deems necessary (A) to preserve the value, marketability
or rentability of the Property; (B) to increase the gross receipts from the
Property; or (C) otherwise to protect Borrower’s and Lender’s respective
interests in the Property.

 

(d)                                 Borrower appoints Lender as Borrower’s
attorney-in-fact, at Lender’s election, to perform any actions and to execute
and record any instruments necessary to effectuate the actions described in this
Section, in each instance only at Lender’s election and only to the extent
Borrower has failed to comply with the provisions of this Section.

 

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Section 14.5.  General Provisions Pertaining to Foreclosures and the Power of
Sale.  The following provisions will apply to any Proceeding to foreclose and to
any sale of the Property by power of sale or pursuant to a judgment of
foreclosure and sale:

 

(i)                                     Lender’s right to institute a Proceeding
to foreclose or to sell by power of sale will not be exhausted by a Proceeding
or a sale that is defective or not completed;

 

(ii)                                  any sale may be postponed or adjourned by
Lender by public announcement at the time and place appointed for the sale
without further notice;

 

(iii)                               with respect to any sale pursuant to a
judgment of foreclosure and sale or by power of sale, the Property may be sold
as an entirety or in parcels, at one or more sales, at the time and place, on
terms and in the order that Lender deems expedient in its sole discretion;

 

(iv)                              if a portion of the Property is sold pursuant
to this Article, the Loan Documents will remain in full force and effect with
respect to any unmatured portion of the Debt and this Mortgage will continue as
a valid and enforceable first lien on and security interest in the remaining
portion of the Property, subject only to the Permitted Exceptions, without loss
of priority and without impairment of any of Lender’s rights and remedies with
respect to the unmatured portion of the Debt;

 

(v)                                 Lender may bid for and acquire the Property
at a sale and, in lieu of paying cash, may credit the amount of Lender’s bid
against any portion of the Debt selected by Lender in its sole discretion after
deducting from the amount of Lender’s bid the expenses of the sale, costs of
enforcement and other amounts that Lender is authorized to deduct at Law, in
equity or otherwise; and

 

(vi)                              Lender’s receipt of the proceeds of a sale
will be sufficient consideration for the portion of the Property sold and Lender
will apply the proceeds as set forth in this Mortgage.

 

Section 14.6.  Application of Proceeds.   Lender may apply the proceeds of any
sale of the Property by power of sale or pursuant to a judgment of foreclosure
and sale and any other amounts collected by Lender in connection with the
exercise of the Remedies to payment of the Debt in such priority and proportions
as Lender may determine in its sole discretion or in such priority and
proportions as required by Law.

 

Section 14.7.  Power of Attorney.  Borrower appoints Lender as Borrower’s
attorney-in-fact to perform any actions necessary and incidental to exercising
the Remedies.

 

Section 14.8.  Tenant at Sufferance.  If Lender or a Receiver enters the
Property in the exercise of the Remedies and Borrower is allowed to remain in
occupancy of the Property, Borrower will pay to Lender or the Receiver, as the
case may be, in advance, a reasonable rent for the Property occupied by
Borrower.  If Borrower fails to pay the rent, Borrower may be dispossessed by
the usual Proceedings available against defaulting tenants.

 

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ARTICLE XV

LIMITATION OF LIABILITY

 

Section 15.1.  Limitation of Liability.

 

(a)  Notwithstanding any provision in the Loan Documents to the contrary, except
as set forth in subsections (b) and (c), if Lender seeks to enforce the
collection of the Debt, Lender will foreclose this Mortgage instead of
instituting suit on the Note.  If a lesser sum is realized from a foreclosure of
this Mortgage and sale of the Property than the then outstanding Debt, Lender
will not institute any Proceeding against Borrower or Borrower’s general
partners, if any, for or on account of the deficiency, except as set forth in
subsections (b) and (c).

 

(b)  The limitation of liability in subsection (a) will not affect or impair
(i) the lien of this Mortgage or Lender’s other rights and Remedies under the
Loan Documents, including Lender’s right as mortgagee or secured party to
commence an action to foreclose any lien or security interest Lender has under
the Loan Documents; (ii) the validity of the Loan Documents or the Obligations;
(iii) Lender’s rights under any Loan Document that are not expressly
non-recourse; or (iv) Lender’s right to present and collect on any letter of
credit or other credit enhancement document held by Lender in connection with
the Obligations.

 

(c)  The following are excluded and excepted from the limitation of liability in
subsection (a) and Lender may recover personally against Borrower and its
general partners, if any, for the following:

 

(i)                                     all losses suffered and liabilities and
expenses incurred by Lender relating to any fraud or intentional
misrepresentation or omission by Borrower or any of Borrower’s partners,
members, officers, directors, shareholders or principals in connection with
(A) the performance of any of the conditions to Lender making the Loan; (B) any
inducements to Lender to make the Loan; (C) the execution and delivery of the
Loan Documents; (D) any certificates, representations or warranties given in
connection with the Loan; or (E) Borrower’s performance of the Obligations;

 

(ii)                                  (A) all Rents derived from the Property
after a default under the Loan Documents which default is a basis of a
Proceeding by Lender to enforce collection of the Debt and all moneys that, on
the date such a default occurs, are on deposit in one or more accounts used by
or on behalf of Borrower relating to the operation of the Property, except to
the extent properly applied to payment of Debt Service
Payments, Impositions, Insurance Premiums and any reasonable and customary
expenses incurred by Borrower in the operation, maintenance and leasing of the
Property or delivered to Lender (directly or pursuant to the Lock-Box Agreement)
and/or (B) the application or use of any Rents by or at the direction of
Borrower or any Borrower affiliate in breach of the terms of the Lock-Box
Agreement;

 

(iii)                               the cost of remediation of any Environmental
Activity affecting the Property, any diminution in the value of the Property
arising from any Environmental Activity

 

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affecting the Property and any other losses suffered and liabilities and
expenses incurred by Lender relating to a default under the Article entitled
“Environmental”;

 

(iv)                              all security deposits collected by Borrower or
any of Borrower’s predecessors and not refunded to tenants in accordance with
their respective Leases, applied in accordance with the Leases or Law or
delivered to Lender, and all tenant letters of credit and advance rents
collected by Borrower or any of Borrower’s predecessors and not applied in
accordance with the Leases or delivered to Lender (directly or pursuant to the
Lock-Box Agreement);

 

(v)                                 any Termination Fee (as defined in the
Assignment) received by Borrower which is not paid to Lender (or an escrow agent
selected by Lender) in accordance with the terms and conditions of the
Assignment;

 

(vi)                              the replacement cost of any Fixtures or
Personal Property removed from the Property after a default occurs;

 

(vii)                           all losses suffered and liabilities and expenses
incurred by Lender relating to any acts or omissions by Borrower that result in
waste (including economic and non-physical waste) on the Property;

 

(viii)                        all protective advances and other payments made by
Lender pursuant to express provisions of the Loan Documents to protect Lender’s
security interest in the Property or to protect the assignment of the property
described in and effected by the Assignment;

 

(ix)                              all mechanics’ or similar liens relating to
work performed on or materials delivered to the Property prior to Lender
exercising its Remedies, but only to the extent Lender had advanced funds to pay
for the work or materials;

 

(x)                                 all Proceeds that are not applied in
accordance with this Mortgage or not paid to Lender as required under this
Mortgage;

 

(xi)                              all losses suffered and liabilities and
expenses incurred by Lender relating to forfeiture or threatened forfeiture of
the Property to the Government;

 

(xii)                           all losses suffered and liabilities and expenses
incurred by Lender relating to any default by Borrower under any of the
provisions of this Mortgage relating to ERISA;

 

(xiii)                        all losses suffered and liabilities and expenses
incurred by Lender relating to any default by Borrower, Indemnitor or Guarantor
under any of the provisions of this Mortgage relating to Anti-Terrorism Laws or
money laundering laws;

 

(xiv)                       all losses suffered and liabilities and expenses
incurred by Lender relating to any default by Borrower under Section 17.2 of
this Mortgage;

 

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(xv)                          all losses suffered and liabilities and expenses
incurred by Lender relating to the failure to maintain, or to pay the premiums
for, any insurance required to be maintained under the Loan Documents;

 

(xvi)                       all losses incurred by Lender all losses suffered
and liabilities and expenses incurred by Lender relating to any failure by
Borrower to comply with the terms of the Regulatory Agreement; and

 

(xvii)                    relating to any Borrower Party (A) directly or
indirectly interferes, disturbs, contests, obstructs or in any way hinders
(whether or not intentionally) Lender’s exercise of any of its rights or
remedies under any of the Loan Documents upon an Event of Default (provided that
Borrower is not liable hereunder for any losses incurred by Lender as and to the
extent resultant solely from a good faith dispute by Borrower regarding the
existence of an Event of Default), or (B) in any judicial or quasi-judicial
case, action or proceeding directly or indirectly contests the validity or
enforceability of the Loan Documents.

 

Notwithstanding the foregoing, the limitation of liability in Subsection
(a) above SHALL BECOME NULL AND VOID and shall be of no further force and effect
and Lender may recover personally against Borrower and its general partners, if
any, in the event of (i) a voluntary bankruptcy or insolvency proceeding of
Borrower if such proceeding is not dismissed in accordance with the terms of
this Mortgage, (ii) an involuntary bankruptcy or insolvency proceeding of
Borrower, in which Borrower, any of its principals, officers, general partners
or members, or its related Guarantor colludes with creditors in such bankruptcy
or insolvency proceeding if such proceeding is not dismissed in accordance with
the terms of this Mortgage, (iii) a default by Borrower or any general partner,
manager or managing member of Borrower of any of the covenants or requirements
contained in this Mortgage entitled “Special Purpose Entity Representations,
Warranties and Covenants” Section 13.3; provided that liability under this
clause (iii) shall be limited to any losses suffered by Lender unless such
breach is the basis in whole or in part for the substantive consolidation of
Borrower; or (iv) a Transfer that is not permitted under the Section entitled
“Permitted Transfers” Section 12.2, including the prohibition on any Transfer
that results in a violation of ERISA or any anti-terrorism or money laundering
laws.

 

(d) Nothing under subparagraph (a) above will be deemed to be a waiver of any
right which Lender may have under Section 506(a), 506(b), 1111(b) or any other
provisions of the Bankruptcy Code or under any other Law relating to bankruptcy
or insolvency to file a claim for the full amount of the Debt or to require that
all collateral will continue to secure all of the Obligations in accordance with
the Loan Documents.

 

ARTICLE XVI

WAIVERS

 

SECTION 16.1.  WAIVER OF STATUTE OF LIMITATIONS.  BORROWER WAIVES THE RIGHT TO
CLAIM ANY STATUTE OF LIMITATIONS AS A DEFENSE TO BORROWER’S PAYMENT AND
PERFORMANCE OF THE OBLIGATIONS.

 

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SECTION 16.2.  WAIVER OF NOTICE.  BORROWER WAIVES THE RIGHT TO RECEIVE ANY
NOTICE FROM LENDER WITH RESPECT TO THE LOAN DOCUMENTS EXCEPT FOR THOSE NOTICES
THAT LENDER IS EXPRESSLY REQUIRED TO DELIVER PURSUANT TO THE LOAN DOCUMENTS.

 

SECTION 16.3.  WAIVER OF MARSHALLING AND OTHER MATTERS.  BORROWER WAIVES THE
BENEFIT OF ANY RIGHTS OF MARSHALLING OR ANY OTHER RIGHT TO DIRECT THE ORDER IN
WHICH ANY OF THE PROPERTY WILL BE (i) SOLD; OR (ii) MADE AVAILABLE TO ANY ENTITY
IF THE PROPERTY IS SOLD BY POWER OF SALE OR PURSUANT TO A JUDGMENT OF
FORECLOSURE AND SALE.  BORROWER ALSO WAIVES THE BENEFIT OF ANY LAWS RELATING TO
APPRAISEMENT, VALUATION, STAY, EXTENSION, REINSTATEMENT, MORATORIUM, HOMESTEAD
AND EXEMPTION RIGHTS OR A SALE IN INVERSE ORDER OF ALIENATION.

 

SECTION 16.4.  WAIVER OF TRIAL BY JURY.  BORROWER WAIVES TRIAL BY JURY IN ANY
PROCEEDING BROUGHT BY OR AGAINST, OR COUNTERCLAIM OR CROSS-COMPLAINT ASSERTED BY
OR AGAINST, LENDER RELATING TO THE LOAN, THE PROPERTY DOCUMENTS OR THE LEASES.

 

SECTION 16.5.  WAIVER OF COUNTERCLAIM.  BORROWER WAIVES THE RIGHT TO ASSERT A
COUNTERCLAIM OR CROSS-COMPLAINT, OTHER THAN COMPULSORY OR MANDATORY
COUNTERCLAIMS OR CROSS-COMPLAINTS, IN ANY PROCEEDING LENDER BRINGS AGAINST
BORROWER RELATING TO THE LOAN, INCLUDING ANY PROCEEDING TO ENFORCE REMEDIES.

 

SECTION 16.6.  WAIVER OF JUDICIAL NOTICE AND HEARING.  BORROWER WAIVES ANY RIGHT
BORROWER MAY HAVE UNDER LAW TO NOTICE OR TO A JUDICIAL HEARING PRIOR TO THE
EXERCISE OF ANY RIGHT OR REMEDY PROVIDED BY THE LOAN DOCUMENTS TO LENDER AND
BORROWER WAIVES THE RIGHTS, IF ANY, TO SET ASIDE OR INVALIDATE ANY SALE DULY
CONSUMMATED IN ACCORDANCE WITH THE PROVISIONS OF THE LOAN DOCUMENTS ON THE
GROUND (IF SUCH BE THE CASE) THAT THE SALE WAS CONSUMMATED WITHOUT A PRIOR
JUDICIAL HEARING.

 

SECTION 16.7.  WAIVER OF SUBROGATION.  BORROWER WAIVES ALL RIGHTS OF SUBROGATION
TO LENDER’S RIGHTS OR CLAIMS RELATED TO OR AFFECTING THE PROPERTY OR ANY OTHER
SECURITY FOR THE LOAN UNTIL THE LOAN IS PAID IN FULL AND ALL FUNDING OBLIGATIONS
UNDER THE LOAN DOCUMENTS HAVE BEEN TERMINATED.

 

SECTION 16.8.  GENERAL WAIVER.  BORROWER ACKNOWLEDGES THAT (A) BORROWER AND
BORROWER’S PARTNERS, MEMBERS OR PRINCIPALS, AS THE CASE MAY BE, ARE
KNOWLEDGEABLE BORROWERS OF COMMERCIAL FUNDS AND EXPERIENCED REAL ESTATE
DEVELOPERS OR INVESTORS WHO UNDERSTAND FULLY THE EFFECT OF THE ABOVE PROVISIONS;
(B) LENDER

 

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WOULD NOT MAKE THE LOAN WITHOUT THE PROVISIONS OF THIS ARTICLE; (C) THE LOAN IS
A COMMERCIAL OR BUSINESS LOAN UNDER THE LAWS OF THE STATE OR COMMONWEALTH WHERE
THE PROPERTY IS LOCATED, NEGOTIATED BY LENDER AND BORROWER AND THEIR RESPECTIVE
ATTORNEYS AT ARMS LENGTH; AND (D) ALL WAIVERS BY BORROWER IN THIS ARTICLE HAVE
BEEN MADE VOLUNTARILY, INTELLIGENTLY AND KNOWINGLY, AFTER BORROWER FIRST HAS
BEEN INFORMED BY COUNSEL OF BORROWER’S OWN CHOOSING AS TO POSSIBLE ALTERNATIVE
RIGHTS, AND HAVE BEEN MADE AS AN INTENTIONAL RELINQUISHMENT AND ABANDONMENT OF A
KNOWN RIGHT AND PRIVILEGE. THE FOREGOING ACKNOWLEDGMENT IS MADE WITH THE INTENT
THAT LENDER AND ANY SUBSEQUENT HOLDER OF THE NOTE WILL RELY ON THE
ACKNOWLEDGMENT.

 

ARTICLE XVII

NOTICES

 

Section 17.1.  Notices.  All acceptances, approvals, consents, demands, notices,
requests, waivers and other communications (the “Notices”) required or permitted
to be given under the Loan Documents must be in writing and (a) delivered
personally by a process server providing a sworn declaration evidencing the date
of service, the individual served, and the address where the service was made;
(b) sent by certified mail, return receipt requested; or (c) delivered by
nationally recognized overnight delivery service that provides evidence of the
date of delivery (for next morning delivery if sent by overnight delivery
service), in all cases with charges prepaid, addressed to the appropriate party
at its address listed below:

 

If to Lender:

Teachers Insurance and Annuity

 

Association of America

 

730 Third Avenue

 

New York, New York 10017

 

 

Attention: Director

 

 

Global Real Estate/

 

 

Fixed Income

 

 

TIAA Authorization #AAA-7440

 

 

Investment ID #0007003

 

 

 

with a

 

 

copy to:

Teachers Insurance and Annuity

 

Association of America

 

730 Third Avenue

 

New York, New York 10017

 

 

Attention: Associate General Counsel, Director

 

 

Asset Management Law

 

 

TIAA Authorization #AAA-7440

 

 

Investment ID #0007003

 

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And

Commercial Loan Services

 

929 Gessner, Suite 1740

 

Houston, TX 77024

 

Attention: Chief Legal Officer

 

 

 

If to Borrower:

Hamilton Green Apartments, LLC

 

39 Brighton Avenue

 

Boston, Massachusetts 02134

 

Attn:

Carl Valeri

with a

 

 

copy to:

Saul Ewing LLP

 

131 Dartmouth Street, Suite 501

 

Boston, Massachusetts 02116

 

Attention: Sally Michael, Esq.

 

Lender and Borrower each may change from time to time the address to which
Notices must be sent, by notice given in accordance with the provisions of this
Section.  All Notices given in accordance with the provisions of this
Section will be deemed to have been received on the earliest of (i) actual
receipt; (ii) Borrower’s rejection of delivery; or (iii) 3 Business Days after
having been deposited in any mail depository regularly maintained by the United
States postal service, if sent by certified mail, or 1 Business Day after having
been deposited with a nationally recognized overnight delivery service, if sent
by overnight delivery or on the date of personal service, if served by a process
server.

 

Section 17.2.                          Change in Borrower’s Legal Name, Place of
Business or State of Formation.  Borrower will notify Lender in writing prior to
any change in Borrower’s legal name, place of business or state or commonwealth
of formation, including as a result of, or in connection with, any Transfer,
including any Permitted Transfer.

 

ARTICLE XVIII

MISCELLANEOUS

 

Section 18.1.                          Applicable Law.  The Loan Documents are
governed by and will be construed in accordance with the Laws of the state or
commonwealth in which the Property is located without regard to conflict of law
provisions, except to the extent that the Uniform Commercial Code requires
otherwise.

 

Section 18.2.                          Usury Limitations.  Borrower and Lender
intend to comply with all Laws with respect to the charging and receiving of
interest.  Any amounts charged or received by Lender for the use or forbearance
of the Principal to the extent permitted by Law, will be amortized and spread
throughout the Term until payment in full so that the rate or amount of interest
charged or received by Lender on account of the Principal does not exceed the
Maximum Interest Rate.  If any amount charged or received under the Loan
Documents that is deemed to be interest is determined to be in excess of the
amount permitted to be charged or received at the Maximum Interest Rate, the
excess will be deemed to be a prepayment of Principal when paid, without
premium, and any

 

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portion of the excess not capable of being so applied will be refunded to
Borrower.  If during the Term the Maximum Interest Rate, if any, is eliminated,
then for the purposes of the Loan, there will be no Maximum Interest Rate.

 

Section 18.3.                          Lender’s Discretion.  Wherever under the
Loan Documents any matter is required to be satisfactory to Lender, Lender has
the right to approve or determine any matter or Lender has an election, Lender’s
approval, determination or election will be made in Lender’s reasonable
discretion unless expressly provided to the contrary.

 

Section 18.4.                          Unenforceable Provisions.  If any
provision in the Loan Documents is found to be illegal or unenforceable or would
operate to invalidate any of the Loan Documents, then the provision will be
deemed expunged and the Loan Documents will be construed as though the provision
was not contained in the Loan Documents and the remainder of the Loan Documents
will remain in full force and effect.

 

Section 18.5.                          Survival of Borrower’s Obligations. 
Borrower’s representations, warranties and covenants contained in the Loan
Documents will continue in full force and effect and survive (i) satisfaction of
the Obligations; (ii) release of the lien of this Mortgage; (iii) assignment or
other transfer of all or any portion of Lender’s interest in the Loan Documents
or the Property; (iv) Lender’s exercise of any of the Remedies or any of
Lender’s other rights under the Loan Documents; (v) a Transfer; (vi) amendments
to the Loan Documents; and (vii) any other act or omission that might otherwise
be construed as a release or discharge of Borrower.

 

Section 18.6.                          Relationship Between Borrower and Lender;
No Third Party Beneficiaries.

 

(a)  Lender is not a partner of or joint venturer with Borrower or any other
entity as a result of the Loan or Lender’s rights under the Loan Documents; the
relationship between Lender and Borrower is strictly that of creditor and
debtor.  Each Loan Document is an agreement between the parties to that Loan
Document for the mutual benefit of the parties and no entities other than the
parties to that Loan Document will be a third party beneficiary or will have any
claim against Lender or Borrower by virtue of the Loan Document.  As between
Lender and Borrower, any actions taken by Lender under the Loan Documents will
be taken for Lender’s protection only, and Lender has not and will not be deemed
to have assumed any responsibility to Borrower or to any other entity by virtue
of Lender’s actions.

 

(b)  All conditions to Lender’s performance of its obligations under the Loan
Documents are imposed solely for the benefit of Lender.  No entity other than
Lender will have standing to require satisfaction of the conditions in
accordance with their provisions or will be entitled to assume that Lender will
refuse to perform its obligations in the absence of strict compliance with any
of the conditions.

 

Section 18.7.                          Partial Releases; Extensions; Waivers. 
Lender may: (i) release any part of the Property or any entity obligated for any
of the Obligations; (ii) extend the time for payment or performance of any of
the Obligations or otherwise amend the provisions for payment or performance by
agreement with any entity that is obligated for the Obligations or that has an
interest in the Property; (iii) accept additional security for the payment and
performance of the

 

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Obligations; and (iv) waive any entity’s performance of an Obligation, release
any entity or individual now or in the future liable for the performance of the
Obligation or waive the exercise of any Remedy or option.  Lender may exercise
any of the foregoing rights without notice, without regard to the amount of any
consideration given, without affecting the priority of the Loan Documents,
without releasing any entity not specifically released from its obligations
under the Loan Documents, without releasing any guarantor(s) or surety(ies) of
any of the Obligations, without effecting a novation of the Loan Documents and,
with respect to a waiver, without waiving future performance of the Obligation
or exercise of the Remedy waived.

 

Section 18.8.                          Service of Process.  Borrower irrevocably
consents to service of process by registered or certified mail, postage prepaid,
return receipt requested, to Borrower at its address set forth in the
Article entitled “Notices”.

 

Section 18.9.                          Entire Agreement.  Oral agreements or
commitments between Borrower and Lender to lend money, to extend credit or to
forbear from enforcing repayment of a debt, including promises to extend or
renew the debt, are not enforceable.  Any agreements between Borrower and Lender
relating to the Loan are contained in the Loan Documents, which contain the
complete and exclusive statement of the agreements between Borrower and Lender,
except as Borrower and Lender may later agree in writing to amend the Loan
Documents.  The language of each Loan Document will be construed as a whole
according to its fair meaning and will not be construed against the party by or
for whom it was drafted.

 

Section 18.10.                   No Oral Amendment.  The Loan Documents may not
be amended, waived or terminated orally or by any act or omission made
individually by Borrower or Lender but may be amended, waived or terminated only
by a written document signed by the party against which enforcement of the
amendment, waiver or termination is sought.

 

Section 18.11.                   Lost or Destroyed Note.  If the Note is lost,
mutilated, destroyed or stolen, Borrower will deliver to Lender a new,
substitute note containing the same provisions as the Note, provided that
Borrower is furnished with reasonably satisfactory evidence of the loss,
mutilation, destruction or theft of the Note.

 

Section 18.12.                   Covenants Run with the Land.  Subject to the
restrictions on transfer contained in the Article entitled “TRANSFERS, LIENS AND
ENCUMBRANCES”, all of the covenants of this Mortgage and the Assignment run with
the Land, will bind all parties hereto and all tenants and subtenants of the
Land or the Improvements and their respective heirs, executors, administrators,
successors and assigns, and all occupants and subsequent owners of the Property,
and will inure to the benefit of Lender and all subsequent holders of the Note
and this Mortgage.

 

Section 18.13.                   Time of the Essence.  Time is of the essence
with respect to Borrower’s payment and performance of the Obligations.

 

Section 18.14.                   Subrogation.  If the Principal or any other
amount advanced by Lender is used directly or indirectly to pay off, discharge
or satisfy all or any part of an encumbrance affecting the Property, then Lender
is subrogated to the encumbrance and to any security held by

 

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the holder of the encumbrance, all of which will continue in full force and
effect in favor of Lender as additional security for the Obligations.

 

Section 18.15.                   Joint and Several Liability.  If Borrower
consists of more than one person or entity, the obligations and liabilities of
each such person or entity under this Mortgage are joint and several.

 

Section 18.16.                   Successors and Assigns.  The Loan Documents
bind the parties to the Loan Documents and their respective successors, assigns,
heirs, administrators, executors, agents and representatives and inure to the
benefit of Lender and its successors, assigns, heirs, administrators, executors,
agents and representatives.

 

Section 18.17.                   Duplicates and Counterparts.  Duplicate
counterparts of any of the Loan Documents, other than the Note, may be executed
and together will constitute a single original document.

 

ARTICLE XIX

ADDITIONAL PROVISIONS PERTAINING TO STATE LAWS

 

Section 19.1.                          The provisions set forth below shall
govern and control in the event of any conflict between the terms thereof and
the terms of the balance of this Mortgage:

 

(a)                                 Residential Lease Security Deposits. 
Notwithstanding any provision herein or in any of the Loan Documents to the
contrary, nothing herein shall be construed to assign to Lender or to create a
security interest in favor of Lender in violation of the provisions of
Massachusetts General Laws Chapter 186, Section 15B in any security deposits
made by tenants under any residential Lease of the Property or any portion
thereof, or in any accounts of Borrower in which such residential security
deposits are held, which residential security deposits shall be held and
released by Borrower in accordance with the provisions of Massachusetts General
Laws Chapter 186, Section 15B.  Without limiting the generality of the
foregoing, as required by said Chapter 186, Section 15B, upon the foreclosure of
this Mortgage, or the delivery by Borrower of a deed in lieu of foreclosure to
Lender  or its designee, Borrower shall turn over all such residential security
deposits and any interest accrued thereon to Borrower’s successor in title to
the Property.

 

(b)                                 Mortgage Covenants.  This Mortgage and all
of the grants herein are made with mortgage covenants within the meaning of
Massachusetts General Laws Chapter 183 Section 19.

 

(c )                               Statutory Condition.  This Mortgage is given
on the “Statutory Condition” within the meaning of Massachusetts General Law
Chapter 183 Section 20.

 

(d )                              Power of Sale.  The “Statutory Power of Sale”
referenced in Massachusetts General Law Chapter 183 Section 21 is incorporated
herein by reference.

 

REMAINDER OF PAGE LEFT INTENTIONALLY BLANK

 

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IN WITNESS WHEREOF, Borrower has executed and delivered this Mortgage as of the
date first set forth above.

 

 

 

BORROWER:

 

 

 

 

 

HAMILTON GREEN APARTMENTS, LLC, a Delaware limited liability company

 

 

 

 

 

 

 

By:

NewReal, Inc., a Massachusetts corporation, its manager

 

 

 

 

By:

 

 

 

Ronald Brown, President

 

 

COMMONWEALTH OF MASSACHUSETTS

 

, ss:

 

On this            day of               , 2013, before me, the undersigned
notary public, personally appeared Ronald Brown, the president of NewReal Inc.,
a Massachusetts corporation, the manager of Hamilton Green Apartments, LLC,
proved to me through satisfactory evidence of identification, which was
                                                  , to be the person whose name
is signed on the preceding or attached document and acknowledged to me that s/he
signed it voluntarily for its stated purpose.

 

 

 

 

 

Notary Public

My commission expires:

 

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Exhibit A

 

LEGAL DESCRIPTION

 

Real property in the Town of Andover, County of Essex, Commonwealth of
Massachusetts, described as follows:

 

Parcel 1(311 Lowell Street)

 

A certain Parcel of land with the buildings and improvements thereon in Andover,
Essex County, Massachusetts, and being shown as Lot 2 on a plan entitled “Plan
of Land-307-311 Lowell Street- Andover, Mass.”, prepared for Lowell Street
Associates Limited Partnership by Otte & Dwyer, Inc. Land Surveyors dated
June 21, 2004, recorded with the Essex North Registry of Deeds (“Registry”) as
Plan No. 14808 on June 30, 2004, described as follows:

 

Beginning at a point on the northwesterly sideline of said Lowell Street, said
point being the Southwesterly most corner of said Lot 2; thence running

 

N 33-29-14 W one hundred eighteen and 00/100 (118.00) feet to a corner; thence
turning and running

 

S 52-05-47 W two hundred forty and 72/100 (240.72) feet to a corner; thence
turning and running

 

N 33-29-14 W one hundred ninety and 00/100 (190.00) feet to a corner; thence
turning and running

 

S 62-29-44 W two hundred forty-nine and 86/100 (249.86) feet to a point; thence

 

S 66-05-13 W thirty-eight and 95/100 (38.95) feet to a point; thence

 

S 60-14-01 W fifteen and 62/100 (15.62) feet to a corner; thence turning and
running

 

Northwesterly by a curved line to the right having a radius of 320.00 feet, a
distance of seven and 04/100 (7.04) feet; thence

 

N 27-21-52 W four hundred thirty-four and 86/100 (434.86) feet to a point;
thence

 

N 18-50-48 W one hundred ten and 67/100 (110.67) feet to a corner; thence
turning and running

 

N 64-33-42 E six hundred sixty-five and 69/100 feet (665.69) feet to a corner;
thence turning and running

 

S 26-18-33 E one hundred forty-six and 76/100 (146.76) feet to a point; thence

 

Southeasterly by a curved line to the left having a radius of 50.00 feet, a
distance of seventy- eight and 54/100 (78.54) feet; thence

 

N 63-41-27 E thirty-six and 78/100 (36.78) feet to a corner; thence turning and
running

 

S 34-36-07 E one hundred seventy-six and 83/100 (176.83) feet to a corner;
thence turning and running

 

N 54-37-39 E sixty and 54/100 (60.54) feet to a corner; thence turning and
running

 

S 34-34-40 E forty-five and 00/100 (45.00) feet to a corner; thence turning and
running

 

S 20-40-48 W sixty-two and 81/100 (62.81) feet to a point; thence

 

Southwesterly by a curved line to the right having a radius of 50.00 feet, a
distance of forty-four and 95/100 (44.95) feet; thence

 

--------------------------------------------------------------------------------

 

Southeasterly by a curved line to the left having a radius of 35.00 feet, a
distance of seventy-four and 60/ 100 (74.60) feet; thence

 

Southeasterly again, by a curved line to the left having a radius of 122.00
feet, a distance of ninety-seven and 40/100 feet (97.40) feet to a corner;
thence turning and running

 

S 50-15-40 E three and 05/100 (3.05) feet to a corner; thence turning and
running

 

N 39-44-20 E twenty-seven and 00/100 (27.00) feet to a corner; thence turning
and running

 

S  50-15-40  E thirty and 00/100 feet (30.00) feet to a corner; thence turning
and running

 

N 39-44-20 E eleven and 21/100 (11.21) feet to a point; thence

 

Southeasterly by a curved line to the right having a radius of 25.00 feet, a
distance of forty-one and 79/100 (41.79) feet to a point; thence

 

S 44-29-27 E forty-seven and 73/100 (47.73) feet, to a point on the
northwesterly sideline of said Lowell Street; thence turning and running by said
sideline on three courses as follows:

 

S 37-46-23 W two hundred six and 73/100 (206.73) feet to a corner; thence
turning and running

 

N 52-13-37 W five and 00/100 (5.00) feet to a corner; thence turning and running

 

Southwesterly by a curved line to the right having a radius 1047.44 feet, a
distance of one hundred forty-two and 24/100 (142.24) feet to the point of
beginning.

 

Together with the benefit of certain rights as provided in the following
documents:

 

1.              Declaration and Grant of Easements between Harry Axelrod and
Lowell Street Associates Limited Partnership dated May 22, 1991 recorded with
the Registry in Book 3274, Page 96 (“1991 Easement Agreement”)

 

2.              Rights and easement granted in Reciprocal Easement Agreement
between Andover Real Estate Corporation and Rolling Green Motor Inn Corporation
dated September 22, 1982, and recorded with the Registry in Book 1617, Page 187,
as affected by Easement Relocation Agreement dated April 28, 2005, and recorded
with the Registry in Book 9483, Page 73.

 

3.              Rights and easements granted in a certain Declaration and Grant
of Easement, Rights and Restrictions dated June 17, 2003 and recorded with the
Registry in Book 7920, Page 113, as affected by Restatement of Declaration and
Grant of Easements, Rights and Restrictions dated April 28, 2005 recorded with
the Registry in Book 9483, Page 11.

 

Parcel 2 (319 Lowell Street)

 

The land with the buildings thereon situated on Lowell Street in Andover,
No. Essex County, Massachusetts and being shown as Lot 3 on a plan of land
entitled “Plan of Land in Andover, Mass. as surveyed for John Bolten” drawn by
McCracken Bros. Engineers, Methuen, Mass., Scale 1”=20’ dated January 7, 1947
and recorded in No. Essex County Registry of Deeds as Plan #1692 to which plan
reference is made for a more particular description of Lot 3, as affected by
Taking by the Commonwealth of Massachusetts for the relocation of Lowell Street
dated December 4, 1956 and recorded in the Registry in Book 856, Page 100, as
affected by an entry dated June 25, 1957 and recorded in the Registry in Book
858, Page 84, and being more particularly described as follows:

 

--------------------------------------------------------------------------------

 

Beginning at a point on the northwesterly sideline of said Lowell Street said
point being the southwesterly most corner of Lot 2; thence running

 

N 33-29-14 W one hundred eighteen and 00/100 (118.00) feet to a corner; thence
turning and running

 

S 52-05-47 W eighty and 24/100 (80.24) feet to a corner; thence turning and
running

 

S 33-31-35 E one hundred twenty-six and 06/100 (126.06) feet to a corner; thence
turning and running

 

Northeasterly by the sideline of Lowell Street by a curved line to the left
having a radius of 1047.44 feet, eighty-one and 19/100 (81.19) feet to the point
of beginning.

 

The above described premises is also described as follows:

 

PARCEL 1 (311 Lowell Street)

 

A certain Parcel of land with the buildings and improvements thereon in Andover,
Essex County, Massachusetts, and being shown as Lot 2 on a plan entitled “Plan
of Land-307- 311 Lowell Street-Andover, Mass.”, prepared for Lowell Street
Associates Limited Partnership-by Otte & Dwyer, Inc.-Land Surveyors dated
June 21, 2004, recorded with the Essex North Registry of Deeds (“Registry”) as
Plan No. 14808 on June 30, 2004, as modified by a plan entitled “Plan of
Land-325 Lowell Street-Andover, Mass.”, prepared for Criterion Development
Partners-by Otte & Dwyer, Inc.-Land Surveyors dated December 12, 2005, recorded
with said Registry as Plan No. 15311 on February 7, 2006, and as further
modified by an actual field survey and property line determination by Hayes
Engineering, Inc. in December, 2006, described as follows:

 

Beginning at a point on the northwesterly sideline of said Lowell Street, said
point being the Southwesterly most corner of said Lot 2; thence running

 

N33°14’39”W a distance of 118.40 feet; thence turning and running

 

S52°20’21”W a distance of 80.24 feet; thence running

 

S52°20’21”W a distance of 160.48 feet; thence turning and running

 

N33°09’55”W a distance of 190.83 feet; thence turning and running

 

S62°26’51”W a distance of 250.04 feet; thence turning and running

 

S65°59’57”W a distance of 38.70 feet; thence turning and running

 

S60°10’38”W a distance of 16.95 feet to a point on the easterly location line of
Interstate Route 93; thence turning and running

 

Northwesterly along said sideline with a curve turning to the right having an
arc length of 5.00 feet on a radius of 320.00 feet; thence running

 

N27°21’52”W along said sideline a distance of 434.86 feet; thence turning and
running

 

N18°50’48”W along said sideline a distance of 109.60 feet; thence turning and
running

 

N64°35’16”E a distance of 665.43 feet; thence turning and running

 

S26°18’15”E a distance of 145.49 feet; thence turning and running

 

Southeasterly with a curve turning to the left having an arc length of 78.54
feet on a radius of 50.00 feet; thence running;

 

N63°41’45”E a distance of 36.78 feet; thence turning and running

 

S34°35’49”E a distance of 176.83 feet; thence turning and running

 

N54°37’57”E a distance of 60.54 feet; thence turning and running

 

S34°34’22”E a distance of 45.00 feet; thence turning and running

 

S20°41’06”W a distance of 62.81 feet; thence turning and running

 

Southwesterly with a curve turning to the right having an arc length of 44.95
feet on a radius of 50.00 feet; thence running;

 

Southeasterly with a curve turning to the left having an arc length of 74.60
feet on a radius of 35.00 feet; thence running;

 

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Southeasterly again with a curve turning to the left having an arc length of
97.40 feet on a radius of 122.00 feet; thence turning and running;

 

S50°15’22”E a distance of 3.05 feet; thence turning and running

 

N39°44’38”E a distance of 27.00 feet; thence turning and running

 

S50°15’22”E a distance of 30.00 feet; thence turning and running

 

N39°44’38”E a distance of 11.21 feet; thence running

 

Southeasterly with a curve turning to the right having an arc length of 41.79
feet on a radius of 25.00 feet; thence running;

 

S44°29’09”E a distance of 47.73 feet to a point on the northerly sideline of
Lowell Street; thence turning and running

 

S37°46’41”W along said sideline a distance of 206.52 feet; thence turning and
running

 

N52°13’19”W along said sideline a distance of 5.00 feet; thence turning and
running

 

Southwesterly along said sideline with a curve turning to the right having an
arc length of 142.27 feet on a radius of 1047.44 feet to the point of beginning.

 

Containing an area of 499,461 Square Feet, or 11.466 Acres.

 

Together with the benefit of certain rights as provided in the following
documents:

 

1. Declaration and Grant of Easements between Harry Axelrod and Lowell Street
Associates Limited Partnership dated May 22, 1991 recorded with the Registry in
Book 3274, Page 96 (“1991 Easement Agreement”)

 

2. Rights and easement granted in Reciprocal Easement Agreement between Andover
Real Estate Corporation and Rolling Green Motor Inn Corporation dated
September 22, 1982, and recorded with the Registry in Book 1617, Page 187, as
affected by Easement Relocation Agreement dated April 28, 2005, 2005 and
recorded with the Registry in Book 9483, Page 73.

 

3. The following rights granted in a certain Declaration and Grant of Easement,
Rights and Restrictions dated June 17, 2003 and recorded with the Registry in
Book 7920, Page 113, as affected by Restatement of Declaration and Grant of
Easements, Rights and Restrictions dated April 28, 2005 recorded with the
Registry in Book 9483, Page 11.

 

PARCEL 2  (319 Lowell Street)

 

The land with the buildings thereon situated on Lowell Street in Andover,
No. Essex County, Massachusetts and being shown as Lot 3 on a plan of land
entitled “Plan of Land in Andover, Mass. as surveyed for John Bolten” drawn by
McCracken Bros. Engineers, Methuen, Mass., Scale 1”=20’ dated January 7, 1947
and recorded in North Essex County Registry of Deeds as Plan # 1692 to which
plan reference is made for a more particular description of Lot 3, as affected
by Takings by the Commonwealth of Massachusetts for the relocation of Lowell
Street dated May 28, 1957 and recorded in the Registry in Book 856, Page 100 as
affected by an entry dated June 25, 1957 and recorded in the Registry in Book
858, Page 84, and dated November 26, 1969 and recorded in the Registry in Book
1145, Page 150, and as further modified by an actual field survey and property
line determination by Hayes Engineering, Inc. in December, 2006, being more
particularly described as follows:

 

Beginning at a point on the northerly sideline of said Lowell Street, said point
being the southwesterly most corner of Lot 2; thence running:

 

Southwesterly along said sideline with a curve turning to the right having an
arc length of 81.34 feet on a radius of 1047.44 feet; thence turning and
running;

 

N33°14’39”W a distance of 126.82 feet; thence turning and running

 

N52°20’21”E a distance of 80.24 feet; thence turning and running

 

S33°14’39”E a distance of 118.40 feet to the point of beginning.

 

Containing an area of 9,851 Square Feet, or 0.226 Acres.

 

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Exhibit B

 

DEFINITIONS

 

“Acceleration” is defined in Section 14.2(a)(i).

 

“Accumulations” is defined in Section 2.1(vii).

 

“Accumulations Depositary” is defined in Section 6.2(a).

 

“Additional Funds” is defined in Section 7.4(v).

 

“Affiliate” is defined in Section 8.4(c).

 

“Annual Financial Statement” is defined in Section 10.1(a).

 

“Anti-Terrorism Laws” is defined as all Laws relating to terrorist acts, acts of
war and money laundering.

 

“Assessments” is defined as all assessments now or hereafter levied, assessed or
imposed against the Property.

 

“Assignment” is defined as the Assignment of Leases and Rents dated of even date
with this Mortgage made by Borrower for the benefit of Lender.

 

“Bankruptcy Code” means Title 11 of the United States Code.

 

“Borrower” is defined in the introductory paragraph.

 

“Budget” is defined in Section 10.3.

 

“Business Days” is defined as any day on which commercial banks are not
authorized or required by Law to close in New York, New York.

 

“Casualty” is defined as damage to or destruction of the Property by fire or
other casualty.

 

“CERCLA” is defined as the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended by the Superfund Amendments and
Reauthorization Act of 1986 and by the Small Business Liability Relief and
Brownfields Revitalization Act and by the Asset Conservation, Lender Liability
and Deposit Insurance Protection Act of 1996, and as further amended from time
to time.

 

“Code” is defined as the Internal Revenue Code of 1986 and the regulations
promulgated thereunder.

 

--------------------------------------------------------------------------------

 

“Comprehensive Permit” means that certain permit issued by the Town of Andover
pursuant to Massachusetts General Laws Chapter 40B, Section 20-23 and
regulations promulgated thereunder and recorded with the Essex Registry of Deeds
Northern District (the “Land Records”) in Book 8447, Page 238, as affected by
Certification of No Appeal recorded in the Land Records in Book 8447, Page 248,
as affected by Decision Consenting to Proposed Transfer of Comprehensive Permit
Decision No. 3312, dated August 16, 2004 and recorded in the Land Records in
Book 9082, Page 177; by Finding of Insubstantial Charge dated February 15, 2005,
and recorded in the Land Records in Book 9417, Page 39; by Decision to Extend
and Determination of Insubstantial Changes dated August 16, 2004, and recorded
in the Land Records in Book 9474, Page 141; by a Stipulation of Dismissal with
Prejudice recorded in the Land Records in Book 9483, Page 1; as affected by
Finding of Insubstantial Change by the Municipality, Comprehensive Permit 43312,
issued to AND Development, LLC, dated April 25, 2005, recorded in the Land
Records in Book 9554, Page 98 and Decision recorded in the Land Records in Book
9696, Page 75 and as may be further amended or affected.

 

“Condemnation” is defined as the permanent or temporary taking of all or any
portion of the Property, or any interest therein or right accruing thereto, by
the exercise of the right of eminent domain (including any transfer in lieu of
or in anticipation of the exercise of the right), inverse condemnation or any
similar injury or damage to or decrease in the value of the Property, including
severance and change in the grade of any streets and a Condemnation will be
deemed to have occurred on the date title to the Property taken passes or if the
Condemnation is temporary, on the date Borrower no longer has use of the
affected property.

 

“Condemnation Awards” is defined in Section 2.1(viii).

 

“Condemnation Proceeding” is defined as a Proceeding that could result in a
Condemnation.

 

“Control” when used with respect to any specified Person, and unless expressly
defined otherwise with respect to such specified Person, means the possession,
directly or indirectly, of the sole and exclusive power to direct the
management, policies, business and affairs of such Person (including the
exclusive right at all times to appoint and remove the managers, directors,
general partners (if applicable), officers or other representatives of such
Person), by reason of the ownership, directly or indirectly, of ownership
interests in such Person, by contract or otherwise, and the terms “controlling”
and “controlled” have meanings correlative to the foregoing.

 

“CPA” is defined as an independent certified public accountant satisfactory to
Lender.

 

“Debt” is defined in Section 3.1.

 

“Debt Service Coverage” is defined as Net Operating Income of the Property for
any given period divided by the amount of scheduled Debt Service Payments over
such period, as determined by Lender. If no period is specified, then Debt
Service Coverage will be determined over a twelve (12) month period.

 

“Debt Service Payments” is defined as the monthly installments of principal
and/or interest payable by Borrower to Lender as set forth in the Note.

 

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“Default Interest Rate” is defined as the lower of nine and sixty-seven
hundredths percent (9.67%) per annum or the Maximum Interest Rate, if any.

 

“Destruction Event” is defined in Section 7.4.

 

“Environmental Activity” is defined as any actual, suspected or threatened
abatement, cleanup, disposal, generation, handling, manufacture, possession,
release, remediation, removal, storage, transportation, treatment or use of any
Hazardous Material.  The actual, suspected or threatened presence of any
Hazardous Material or the actual, suspected or threatened noncompliance with any
Environmental Laws, will be deemed Environmental Activity.

 

“Environmental Laws” is defined as all Laws pertaining to health, safety,
protection of the environment, natural resources, conservation, wildlife, waste
management, Hazardous Materials and pollution, including CERCLA.

 

“Environmental Report” is defined as the report prepared by AECOM, dated
October 28, 2013, as amended.

 

“ERISA” is defined in Section 8.3(a).

 

“Event of Default” is defined in Section 14.1.

 

“Executive Order” is defined in Section 8.4.

 

“Existing Member” is defined in Section 12.1(b).

 

“Existing Member GP” is defined in Section 12.1(b).

 

“Expenses” is defined in Section 11.1(a).

 

“Financial Books and Records” is defined as detailed accounts of the income and
expenses of the Property and of Borrower and all other data, records and
information that either are specifically referred to in the Article entitled
“FINANCIAL REPORTING” or are necessary to the preparation of any of the
statements, reports or certificates required under such Article and includes all
supporting schedules prepared or used by the CPA in auditing the Annual
Financial Statement or in issuing its opinion.

 

“Fiscal Year” is defined as any calendar year or partial calendar year during
the Term.

 

“Fixed Interest Rate” is defined as four and sixty-seven hundredths percent
(4.67%) per annum.

 

“Fixtures” is defined as all of the Property that constitutes “fixtures”‘ as
defined on the Uniform Commercial Code.

 

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“Government” is defined as any federal, state or municipal governmental or
quasi-governmental authority including any executive, legislative or judicial
branch and any division, subdivision or agency of any of them and any entity to
which any of them has delegated authority.

 

“Hazardous Materials” is defined as (i) any by-product, chemical, compound,
contaminant, pollutant, product, substance, waste or other material that is
hazardous or toxic, (ii) any by-product, chemical, compound, contaminant,
pollutant, product, substance, waste or other material, the abatement, cleanup,
discharge, disposal, emission, exposure to, generation, handling, manufacture,
possession, presence, release, removal, remediation, storage, transportation,
treatment or use of which is controlled, prohibited or regulated by any
Environmental Laws, including asbestos, petroleum, petroleum products and
polychlorinated biphenyls and (iii) mold, mildew, fungi, bacteria, viruses and
other microbial matter.

 

“Imposition Penalty Date” is defined in Section 6.1(a).

 

“Impositions” is defined as all Taxes, Assessments, ground rent, if any, water
and sewer rents, fees and charges, levies, permit, inspection and license fees
and other dues, charges or impositions, including all charges and license fees
for the use of vaults, chutes and similar areas adjoining the Land, maintenance
and similar charges and charges for utility services, in each instance whether
now or in the future, directly or indirectly, levied, assessed or imposed on the
Property or Borrower and whether levied, assessed or imposed as excise,
privilege or property taxes.

 

“Improvements” is defined in Section 2.1(ii).

 

“Indemnitor” is defined in the environmental indemnity dated of even date with
this Mortgage made by Indemnitor for the benefit of Lender.

 

“Independent Manager” shall mean a duly appointed member of the board of
directors or board of managers who is provided by a nationally-recognized
company that provides professional independent directors/managers who shall not
have been at the time of initial appointment or at any time while serving as an
Independent Manager, and may not have been at any time during the preceding five
years (i) a stockholder, director, officer, employee, partner, attorney or
counsel of such Borrower or any affiliate of any of them, (ii) a customer,
supplier or other person who derives any of its purchases or revenues from its
activities with such Borrower or any affiliate of any of them, (iii) a person or
other entity controlling or under common control with any such stockholder,
partner, customer, supplier or other person, or (iv) a member of the immediate
family of any such stockholder, director, officer, employee, partner, customer,
supplier or other person.  As used in this definition, the term “control” means
the possession, directly or indirectly, of the power to direct or cause the
direction of the management, policies or activities of a person, whether through
ownership of voting securities, by contract or otherwise.  As used herein, the
term “affiliate” shall mean:  (1)  any person or entity directly or indirectly
owning, controlling or holding with power to vote ten percent (10%) or more of
the outstanding voting securities or interests of such other person or entity;
(2) any person or entity ten percent (10%) or more of whose outstanding voting
securities are directly or indirectly owned, controlled or held with power to
vote by such other person or entity; (3) any person or entity directly or
indirectly controlling, controlled by or under common

 

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control with such other person or entity; (4) any officer, director or partner
of such other person or entity; (5) if such other person or entity is an
officer, director or partner, any company for which such person or entity acts
in any such capacity; and (6) any close relative or spouse of the specified
person.

 

“Institutional Investor” is defined as any bank, savings institution, charitable
foundation, insurance company, real estate investment trust, pension fund or
investment advisor registered under the Investment Advisors Act of 1940, as
amended, and acting as trustee or agent.

 

“Insurance Premiums” is defined as all present and future premiums and other
charges due and payable on policies of fire, rental value and other insurance
covering the Property and required pursuant to the provisions of this Mortgage.

 

“Insurance Proceeds” is defined in Section 2.1(ix).

 

“Insurers” is defined in Section 7.1(c).

 

“Interest” is defined as the fixed interest payable under the Note at the Fixed
Interest Rate and any other sums which are deemed to be interest under Law.

 

“Key Principal” is defined in Section 12.2(b)(i).

 

“Land” is defined in the Recitals.

 

“Late Charge” is defined in the Note.

 

“Law” is defined as all present and future codes, constitutions, cases,
opinions, rules, manuals, regulations, determinations, laws, orders, ordinances,
requirements and statutes, as amended, of any Government that affect or that may
be interpreted to affect the Property, Borrower or the Loan, including
amendments and all guidance documents and publications promulgated thereunder.

 

“Leases” is defined as all present and future leases, subleases, licenses and
other agreements for the use and occupancy of the Land and Improvements, any
related guarantees and any use and occupancy arrangements created pursuant to
Section 365(h) of the Bankruptcy Code or otherwise in connection with the
commencement or continuation of any bankruptcy, reorganization, arrangement,
insolvency, dissolution, receivership or similar Proceedings, or any assignment
for the benefit of creditors, in respect of any tenant or other occupant of the
Land and Improvements.

 

“Leasing Plan” is defined in Section 10.3(b).

 

“Lender” is defined in the introductory paragraph.

 

“Loan” is defined in the Recitals.

 

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“Loan Documents” is defined as the Note, this Mortgage, the Assignment and all
documents now or hereafter executed by Borrower or held by Lender relating to
the Loan, including all amendments but excluding any indemnities or guaranties
delivered in connection with the Loan.

 

“Lock-Box Agreement” means, collectively (a) that certain Deposit Account
Control Agreement by and between Borrower and Lender, and Bank of America, N.A.,
dated as of the date hereof and (b) that certain Cash Management Agreement by
and between Borrower and Lender dated as of the date hereof.

 

“Low DSCR Period” shall mean any period commencing on the date on which the Debt
Service Coverage Ratio as determined by Lender (based on a 30 year amortization
schedule) declines below 1.10 : 1.00 for a period of three (3) consecutive
calendar months and ending on the date on which the Debt Service Coverage Ratio
as determined by Lender (based on a 30 year amortization schedule) increases to
over 1.25 : 1.00 for a period of three (3) consecutive calendar months.

 

“Manager” is defined in Section 12.1(b).

 

“Material Environmental Contamination” is defined as contamination of the
Property with Hazardous Materials (i) that constitutes a violation of one or
more Environmental Laws; (ii) for which there is a significant possibility that
remediation will be required under Environmental Laws; (iii) that results in a
material risk of liability or expense to Lender; or (iv) that diminishes the
value of the Property.

 

“Maturity Date” is defined in the Recitals.

 

“Maximum Interest Rate” is defined as the maximum rate of interest, if any,
permitted by Law as of the date of this Mortgage to be charged with respect to
the Loan.

 

“MHPFB” is defined as the Massachusetts Housing Partnership Fund Board, a
Massachusetts body politic and corporate, together with any successor or assign
thereof under the Regulatory Agreement.

 

“Mortgage” is defined as this Mortgage, Assignment of Leases and Rents, Security
Agreement and Fixture Filing Statement.

 

“NERA” is defined in Section 12.1(b).

 

“Net Operating Income” is defined as Rents (on a cash basis) over any period
less Operating Expenses determined on a cash basis for such period.

 

“Note” is defined in the Recitals.

 

“Note Payments” is defined in the Note.

 

“Notices” is defined in Section 17.1.

 

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“Obligations” is defined in Section 3.1.

 

“One-Time Sale” is defined in Section 12.2(b)(ii).

 

“Operating Expenses” is defined as the reasonable, customary and actual
out-of-pocket payments paid in cash by Borrower in the ordinary course of
business to unaffiliated third parties (or if affiliated, equivalent to arm’s
length third-party transactions for comparable services) in connection with the
management, operation, maintenance or leasing of the Property, including without
limitation, Impositions, Insurance Premiums and operating expenses for the
Property, ground rent (if any), management fees, landscaping, utilities,
cleaning, administration, repairs, and any recurring cost which is a capital
expenditure in accordance with GAAP and is associated with the maintenance of
the Improvements existing on the date hereof, but shall exclude (i) loan
placement fees and Debt Service Payments, (ii) non-cash items such as
depreciation or amortization and (iii) extraordinary non-recurring capital
expenditures incurred in connection with the ownership, operation and
maintenance of the Property.

 

“Payment Conditions Precedent” is defined in Section 6.1(a).

 

“Permitted Exceptions” is defined as (a) the matters shown in Schedule B, Part 1
and 2 of the title insurance policy insuring the lien of this Mortgage, (b) real
estate taxes and municipal charges not yet due and payable, and (c) any
encumbrances created in compliance with the terms of this Mortgage.

 

“Permitted Merger” is defined in Section 4.2(e).

 

“Permitted Transfers” is defined in Section 12.2(b).

 

“Permitted Use” is defined as use as a first-class residential apartment complex
(with affordable housing requirements as set forth in the Comprehensive Permit
and the Regulatory Agreement) and uses incidentally and directly related to such
use (which incidental uses include an existing single family home that is rented
in connection with and as a part of the residential apartment complex and an
existing on the date hereof telecommunications tower and related facility).

 

“Person” shall mean any individual, corporation, partnership, joint venture,
limited liability company, estate, trust, unincorporated association, any
federal, state, county or municipal government or any bureau, department or
agency thereof and any fiduciary acting in such capacity on behalf of any of the
foregoing.

 

“Personal Property” is defined as the Property, other than Fixtures, the Land or
the Improvements.

 

“Policies” is defined in Section 7.1(b).

 

“Prepayment Premium” is defined in the Note.

 

“Principal” is defined in the Recitals.

 

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“Proceeding” is defined as a pending or threatened action, claim or litigation
before a legal, equitable or administrative tribunal having proper jurisdiction.

 

“Proceeds” is defined in Section 7.2(c).

 

“Prohibited Person” is defined in Section 8.4.

 

“Property” is defined in Section 2.1.

 

“Property Documents” is defined in Section 2.1(v).

 

“Receiver” is defined as a receiver, custodian, trustee, liquidator or
conservator of the Property.

 

“Regulatory Agreement” is defined as the Chapter 40B Regulatory and Affordable
Housing Agreement for Limited Dividend Organizations dated as of February 15,
2008 by and between Windsor Green at Andover, LLC, a Delaware limited liability
company, and the Massachusetts Housing Partnership Funding Board, and recorded
in the Land Records at Book 11067, Page 29. as the same may be amended or
modified.

 

“Remedies” is defined in Section 14.2(a).

 

“Rent Roll” is defined in the Assignment.

 

“Rents” is defined as all present and future rents, prepaid rents, percentage,
participation or contingent rents, issues, profits, proceeds, parking fees,
revenues and other consideration accruing under or in connection with the Leases
or otherwise derived from the use and occupancy of the Land or the Improvements,
including tenant contributions to expenses, security deposits (if and when
forfeited) and royalties, if any, all other fees or payments paid to or for the
benefit of Borrower, including liquidated damages after a default under a Lease,
any termination, cancellation, modification or other fee or premium payable by a
tenant for any reason, the proceeds of any rental insurance and any payments
received pursuant to Sections 502(b) or 365 of the Bankruptcy Code or otherwise
in connection with the commencement or continuance of any bankruptcy,
reorganization, arrangement, insolvency, dissolution, receivership or similar
proceedings, or any assignment for the benefit of creditors, in respect of any
tenant or other occupant of the Land or the Improvements and all claims as a
creditor in connection with any of the foregoing.

 

“Replacement Reserve Pledge” is defined as the Replacement Reserve Pledge and
Security Agreement or the Replacement Reserve Agreement relating to the payment
of certain costs associated with the maintenance and repair of the Property as
in effect from time to time.

 

“Restoration” is defined as the restoration of the Property after a Destruction
Event as nearly as possible to its condition immediately prior to the
Destruction Event, in accordance with the plans and specifications, in a
first-class workmanlike manner using materials substantially equivalent in
quality and character to those used for the original improvements, in accordance
with Law and free and clear of all liens, encumbrances or other charges other
than this Mortgage and the Permitted Exceptions.

 

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“Restoration Completion Date” is defined in Section 7.4(viii).

 

“Restoration Funds” is defined in Section 7.5(b).

 

“Taxes” is defined as all present and future real estate taxes or personal
property taxes, if any, levied, assessed or imposed against the Property.

 

“Tax Pledge” is defined as the Real Estate Tax Pledge and Security Agreement or
the Real Estate Tax Reserve Agreement relating to the payment of Taxes at the
Property as in effect from time to time.

 

“Term” is defined as the scheduled term of this Mortgage commencing on the date
Lender makes the first disbursement of the Loan and terminating on the Maturity
Date.

 

“Transfer” is defined in Section 12.1(a).

 

“Uniform Commercial Code” is defined as the Uniform Commercial Code as in effect
from time to time in the jurisdiction where the Land is located or, to the
extent required by the Uniform Commercial Code, where the Borrower is located,
as applicable.

 

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Exhibit C

 

RULES OF CONSTRUCTION

 

(a)  References in any Loan Document to numbered Articles or Sections are
references to the Articles and Sections of that Loan Document.  References in
any Loan Document to any numbered or lettered Exhibits or Schedules are
references to the Exhibits or Schedules attached to that Loan Document, all of
which are incorporated in and constitute a part of that Loan Document.  Article,
Section, Exhibit and Schedule captions used in any Loan Document are for
reference only and do not describe or limit the substance, scope or intent of
that Loan Document or the individual Articles, Sections, Exhibits or Schedules
of that Loan Document.

 

(b)  The terms “include”, “including” and similar terms are construed as if
followed by the phrase “without limitation”.

 

(c)  The terms “Land”, “Improvements”, “Fixtures”, “Personal Property”,
“Condemnation Awards”, “Insurance Proceeds” and “Property” are construed as if
followed by the phrase “or any part thereof”.

 

(d)  Any agreement by or duty imposed on Borrower in any Loan Document to
perform any obligation or to refrain from any act or omission constitutes a
covenant running with the ownership or occupancy of the Land and the
Improvements, which will bind all parties hereto and their respective successors
and assigns, and all lessees, subtenants and assigns of same, and all occupants
and subsequent owners of the Property, and will inure to the benefit of Lender
and all subsequent holders of the Note and this Mortgage and includes a covenant
by Borrower to cause its partners, members, principals, agents, representatives
and employees to perform the obligation or to refrain from the act or omission
in accordance with the Loan Documents.  Any statement or disclosure contained in
any Loan Document about facts or circumstances relating to the Property,
Borrower or the Loan constitutes a representation and warranty by Borrower made
as of the date of the Loan Document in which the statement or disclosure is
contained.

 

(e)  The term “to Borrower’s knowledge” is construed as meaning to the best of
Borrower’s knowledge after diligent inquiry.

 

(f)  The singular of any word includes the plural and the plural includes the
singular.  The use of any gender includes all genders.

 

(g)  The terms “person”, “party” and “entity” include natural persons, firms,
partnerships, limited liability companies and partnerships, corporations and any
other public or private legal entity.

 

(h)  The term “provisions” includes terms, covenants, conditions, agreements and
requirements.

 

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(i)  The term “amend” includes modify, supplement, renew, extend, replace or
substitute and the term “amendment” includes modification, supplement, renewal,
extension, replacement and substitution.

 

(j)  Reference to any specific Law or to any document or agreement, including
the Note, this Mortgage, any of the other Loan Documents, the Leases, and the
Property Documents, includes any future amendments to the Law, document or
agreement, as the case may be.

 

(k)  No inference in favor of or against a party with respect to any provision
in any Loan Document may be drawn from the fact that the party drafted the Loan
Document.

 

(l)  The term “certificate” means the sworn, notarized statement of the entity
giving the certificate, made by a duly authorized person satisfactory to Lender
affirming the truth and accuracy of every statement in the certificate.  Any
document that is “certified” means the document has been appended to a
certificate of the entity certifying the document that affirms the truth and
accuracy of everything in the document being certified.  In all instances the
entity issuing a certificate must be satisfactory to Lender.

 

(m)  Any appointment of Lender as Borrower’s attorney-in-fact is irrevocable and
coupled with an interest.  Lender may appoint a substitute attorney-in-fact. 
Borrower ratifies all actions taken by the attorney-in-fact but, nevertheless,
if Lender requests, Borrower will specifically ratify any action taken by the
attorney-in-fact by executing and delivering to the attorney-in-fact or to any
entity designated by the attorney-in-fact all documents necessary to effect the
ratification.

 

(n)  Any document, instrument or agreement to be delivered by Borrower will be
in form and content satisfactory to Lender.

 

(o)  All obligations, rights, remedies and waivers contained in the Loan
Documents will be construed as being limited only to the extent required to be
enforceable under the Law.

 

(p)  The unmodified word “days” means calendar days.

 

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Exhibit D

 

PROPERTY DOCUMENTS

 

The Comprehensive Permit

 

The Regulatory Agreement

 

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