EXHIBIT 10.17

PROMISSORY NOTE

LOAN TERMS TABLE

Lender: KeyBank National Association, a national banking association, its
successors and assigns

Loan No.: 10061253

Lender’s Address: 11501 Outlook, Suite 300, Overland Park, Kansas 66211

Lender’s Facsimile No.: 877-379-1625

Borrower: TNP SRT PORTFOLIO II HOLDINGS, LLC, a Delaware limited liability
company

Borrower’s Address: 1900 Main Street, Suite 700, Irvine, California 92614

Borrower’s Facsimile No.: (949) 252-0212

Closing Date: June 13, 2012

Original Principal Amount: $2,000,000.00

Maturity Date: July 1, 2019

Interest Rate: (i) from and after the date hereof through and including
January 1, 2013 (the “Anticipated Repayment Date”), a rate of ten percent
(10%) per annum; and (ii) after the Anticipated Repayment Date, a rate of
fifteen percent (15%) per annum.

Initial Interest Payment Per Diem: $555.56

Monthly Debt Service Payment Amount: an amount sufficient to pay interest at the
Interest Rate on the OPB (as defined below) in arrears for the Accrual Period,
calculated in accordance with Section 1 below.

Payment Date: August 1, 2012 and on the first day of each successive month
thereafter

1. Loan Amount and Rate. FOR VALUE RECEIVED, Borrower promises to pay to the
order of Lender, the Original Principal Amount (or so much thereof as is
outstanding from time to time, which is referred to herein as the “Outstanding
Principal Balance” or “OPB”), with interest on the unpaid OPB from the date of
disbursement of the Loan (as hereinafter defined) evidenced by this Promissory
Note (“Note”) at the Interest Rate. Interest on the outstanding principal
balance of the Loan shall be calculated by multiplying (a) the actual number of
days elapsed in the relevant Accrual Period (hereinafter defined) by (b) a daily
rate based on the Interest Rate and a three hundred sixty (360) day year by
(c) the outstanding principal balance of the Loan. Borrower acknowledges that
the calculation method for interest described herein results in a higher
effective interest rate than the numeric Interest Rate and Borrower hereby
agrees to this calculation method. The loan evidenced by this Note will
sometimes hereinafter be called the “Loan.” The above Loan Terms Table
(hereinafter referred to as the “Table”) is hereby incorporated into and a part
of the Note and all terms used in this Note that are defined in the Table shall
have the meanings set forth therein. “Accrual Period” means the period
commencing on and including the first (1st) day of each calendar month during
the term of the Loan and ending on and including the final calendar date of such
calendar month; however, the initial Accrual Period shall commence on and
include the Closing Date and shall end on and include the final calendar date of
the calendar month in which the Closing Date occurs.

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2. Payments. Payments of principal and interest shall be made as follows:

(a) On the date of disbursement of the Loan proceeds, an interest payment
calculated by multiplying (i) the Initial Interest Payment Per Diem by (ii) the
number of days from (and including) the date of the disbursement of the Loan
proceeds through the last day of the calendar month in which the disbursement
was made;

(b) On each Payment Date until the Maturity Date, a monthly payment equal to the
Monthly Debt Service Payment Amount to be applied to the payment of interest;

(c) If not sooner paid, the Outstanding Principal Balance, all unpaid interest
thereon, and all other amounts owed to Lender pursuant to this Note or any other
Loan Document (as hereinafter defined) or otherwise in connection with the Loan
or the security for the Loan shall be due and payable on the Maturity Date.

3. Security for Note. This Note is secured by a Pledge and Security Agreement
(which is herein called the “Pledge Agreement”) encumbering the Collateral (as
defined therein). This Note, the Pledge Agreement, that certain Mezzanine Loan
Agreement between Borrower and Lender of even date herewith (the “Loan
Agreement”) and all other documents and instruments existing now or after the
date hereof that evidence, secure or otherwise relate to the Loan, including any
financing statements, guaranties, indemnity agreements (including environmental
indemnity agreements), letters of credit, or escrow/holdback or similar
agreements or arrangements, together with all amendments, modifications,
substitutions or replacements thereof, are sometimes herein collectively
referred to as the “Loan Documents” or individually as a “Loan Document.” All
amounts that are now or in the future become due and payable under this Note,
the Pledge Agreement, or any other Loan Document, including any prepayment
consideration and all applicable expenses, costs, charges, and fees, will be
referred to herein as the “Debt.” The remedies of Lender as provided in this
Note, any other Loan Document, or under applicable law shall be cumulative and
concurrent, may be pursued singularly, successively, or together at the
discretion of Lender, and may be exercised as often as the occurrence of an
occasion for which Lender is entitled to a remedy under the Loan Documents or
applicable law. The failure to exercise any right or remedy shall not be
construed as a waiver or release of the right or remedy respecting the same or
any subsequent default. All capitalized terms not otherwise defined herein shall
bear the definition set forth in the Loan Agreement.

4. Payments. All amounts payable hereunder shall be payable in lawful money of
the United States of America to Lender at Lender’s Address or such other place
as the holder hereof may designate in writing, which may include at Lender’s
option, a requirement that payment be made by wire transfer of immediately
available funds in accordance with wire transfer instructions provided by
Lender. Each payment made hereunder shall be made in immediately available funds
and must state the Borrower’s Loan Number. If any payment of principal or
interest on this Note is due on a day other than a Business Day (as hereinafter
defined), such payment shall be made on the next succeeding Business Day. Any
payment on

 

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this Note received after 2:00 o’clock p.m. local time at the place then
designated as the place for receipt of payments hereunder shall be deemed to
have been made on the next succeeding Business Day. All amounts due under this
Note shall be payable without set off, counterclaim, or any other deduction
whatsoever. All payments from Borrower to Lender following the occurrence of an
Event of Default shall be applied in such order and manner as Lender elects in
reduction of costs, expenses, charges, disbursements and fees payable by
Borrower hereunder or under any other Loan Document, in reduction of interest
due on the Outstanding Principal Balance, or in reduction of the Outstanding
Principal Balance. Lender may, without notice to Borrower or any other person,
accept one or more partial payments of any sums due or past due hereunder from
time to time while an Event of Default exists hereunder, after Lender
accelerates the indebtedness evidenced hereby, and/or after Lender commences
enforcement of its remedies under any Loan Document or applicable law, without
thereby waiving any Event of Default, rescinding any acceleration, or waiving,
delaying, or forbearing in the pursuit of any remedies under the Loan Documents.
Lender may endorse and deposit any check or other instrument tendered in
connection with such a partial payment without thereby giving effect to or being
bound by any language purporting to make acceptance of such instrument an accord
and satisfaction of the indebtedness evidenced hereby. As used herein, the term
“Business Day” shall mean a day upon which commercial banks are not authorized
or required by law to close in the city designated from time to time as the
place for receipt of payments hereunder.

5. Late Charge. If any sum payable under this Note or any other Loan Document is
not received by Lender by close of business on the fifth (5th) day after the
date on which it was due, Borrower shall pay to Lender an amount (the “Late
Charge”) equal to the lesser of (a) five percent (5%) of the full amount of such
sum or (b) the maximum amount permitted by applicable law in order to help
defray the expenses incurred by Lender in handling and processing such
delinquent payment and to compensate Lender for the loss of the use of such
delinquent payment. Any such Late Charge shall be secured by the Pledge
Agreement and other Loan Documents. The collection of any Late Charge shall be
in addition to, and shall not constitute a waiver of or limitation of, a default
or Event of Default hereunder or a waiver of or limitation of any other rights
or remedies that Lender may be entitled to under any Loan Document or applicable
law.

6. Default Rate. Upon the occurrence of an Event of Default (including the
failure of Borrower to make full payment on the Maturity Date), Lender shall be
entitled to receive and Borrower shall pay interest on the Outstanding Principal
Balance at the rate of five percent (5%) per annum above the Interest Rate
(“Default Rate”) but in no event greater than the maximum rate permitted by
applicable law. Interest shall accrue and be payable at the Default Rate from
the occurrence of an Event of Default until all Events of Default have been
waived in writing by Lender in its discretion. Such accrued interest shall be
added to the Outstanding Principal Balance, and interest shall accrue thereon at
the Default Rate until fully paid. Such accrued interest shall be secured by the
Pledge Agreement and other Loan Documents. Borrower agrees that Lender’s right
to collect interest at the Default Rate is given for the purpose of compensating
Lender at reasonable amounts for Lender’s added costs and expenses that occur as
a result of Borrower’s default and that are difficult to predict in amount, such
as increased general overhead, concentration of management resources on problem
loans, and increased cost of funds. Lender and Borrower agree that Lender’s
collection of interest at the Default Rate is not a fine or penalty, but is
intended to be and shall be deemed to be reasonable compensation to Lender for

 

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increased costs and expenses that Lender will incur if there occurs an Event of
Default hereunder. Collection of interest at the Default Rate shall not be
construed as an agreement or privilege to extend the Maturity Date or to limit
or impair any rights and remedies of Lender under any Loan Documents. If
judgment is entered on this Note, interest shall continue to accrue
post-judgment at the greater of (a) the Default Rate or (b) the applicable
statutory judgment rate.

7. Origination, Administration, Enforcement, and Defense Expenses. Borrower
shall pay Lender, on demand, all Administration and Enforcement Expenses (as
hereinafter defined) now or hereafter incurred by Lender, together with interest
thereon at the Default Rate, from the date paid or incurred by Lender until such
fees and expenses are paid by Borrower, whether or not an Event of Default or
Default then exists. Provided no Event of Default has occurred, fees and
expenses related solely to origination and administration of the Loan shall be
limited to reasonable fees and expenses, but charges of rating agencies,
governmental entities or other third parties that are outside of the control of
Lender shall not be subject to the reasonableness standard. For the purpose of
this Note, “Administration and Enforcement Expenses” shall mean all fees and
expenses incurred at any time or from time to time by Lender, including legal
(whether for the purpose of advice, negotiation, documentation, defense,
enforcement or otherwise), accounting, financial advisory, auditing, rating
agency, appraisal, valuation, title or title insurance, UCC insurance,
engineering, environmental, collection agency, or other expert or consulting or
similar services, in connection with: (a) the origination of the Loan, including
the negotiation and preparation of the Loan Documents and any amendments or
modifications of the Loan or the Loan Documents, whether or not consummated;
(b) the administration, servicing or enforcement of the Loan or the Loan
Documents, including any request for interpretation or modification of the Loan
Documents or any matter related to the Loan or the servicing thereof (which
shall include the consideration of any requests for consents, waivers,
modifications, approvals, lease reviews or similar matters and any proposed
transfer of the Collateral or any interest therein), (c) any litigation,
contest, dispute, suit, arbitration, mediation, proceeding or action (whether
instituted by or against Lender, including actions brought by or on behalf of
Borrower or Borrower’s bankruptcy estate or any indemnitor or guarantor of the
Loan or any other person) in any way relating to the Loan or the Loan Documents
including in connection with any bankruptcy, reorganization, insolvency, or
receivership proceeding; (d) any attempt to enforce any rights of Lender against
Borrower or any other person that may be obligated to Lender by virtue of any
Loan Document or otherwise whether or not litigation is commenced in pursuance
of such rights; and (e) protection, enforcement against, or liquidation of the
Collateral or any other collateral for the Loan, including any attempt to
inspect, verify, preserve, restore, collect, sell, liquidate or otherwise
dispose of or realize upon the Loan, the Collateral or any other collateral for
the Loan. All Administration and Enforcement Expenses shall be additional Debt
hereunder secured by the Pledge Agreement and the liens granted thereunder
relating to the Collateral, and may be funded, if Lender so elects, by Lender
paying the same to the appropriate persons and thus making an advance on
Borrower’s behalf.

8. Liquidation Events.

(a) Upon the occurrence of (i) any Casualty to all or any portion of an
Individual Property, (ii) any Condemnation of all or any portion of an
Individual Property, (iii) a Transfer of an Individual Property in connection
with realization thereon following a Mortgage Loan

 

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Default, including a foreclosure sale, (iv) any refinancing of the Property or
the Mortgage Loan, or (v) a release of any Individual Property in accordance
with the provisions of the Mortgage Loan Agreement (each, a “Liquidation
Event”), Borrower shall cause the related Net Liquidation Proceeds After Debt
Service to be deposited directly into the Mezzanine Collection Account. On each
date on which Lender actually receives a distribution of Net Liquidation
Proceeds After Debt Service, Borrower shall prepay the outstanding principal
balance of this Note in an amount equal to one hundred percent (100%) of such
Net Liquidation Proceeds After Debt Service, together with interest that would
have accrued on such amount through the next Payment Date. Any amounts of Net
Liquidation Proceeds After Debt Service in excess of the Debt shall be paid to
Borrower. Any prepayment received by Lender pursuant to this Section 8 on a date
other than a Payment Date shall be held by Lender as collateral security for the
Loan in an interest bearing account, with such interest accruing to the benefit
of Borrower, and shall be applied by Lender on the next Payment Date against the
OPB (without being subject to the Yield Maintenance Amount, as defined below).

(b) Borrower shall immediately notify Lender of any Liquidation Event once
Borrower has knowledge of such event. Borrower shall be deemed to have knowledge
of (i) a sale (other than a foreclosure sale) of an Individual Property on the
date on which a contract of sale for such sale is entered into, and a
foreclosure sale, on the date notice of such foreclosure sale is given, and
(ii) a refinancing of the Property, on the date on which a commitment for such
refinancing has been entered into. The provisions of this Section 8 shall not be
construed to contravene in any manner the restrictions and other provisions
regarding refinancing of the Mortgage Loan or Transfer of the Property set forth
in the Loan Agreement, the other Loan Documents and the Mortgage Loan Documents.

9. Prepayment.

(a) Voluntary Prepayments

(i) Except as otherwise expressly provided in Section 8 and this Section 9,
Borrower shall not have the right to prepay the Loan in whole or in part prior
to the Maturity Date.

(ii) Notwithstanding Section 9(a)(i) to the contrary, prior to the Anticipated
Repayment Date, provided no Event of Default has occurred and is continuing,
Borrower may prepay the Loan in whole or in part on any Business Day (such date
of prepayment, the “Prepayment Date”) so long as (i) Borrower provides notice to
Lender no less than ten (10) Business Days prior to the Prepayment Date, (ii) if
the Prepayment Date does not occur on a Payment Date, Borrower’s actual payment
to Lender includes interest for the full Accrual Period during which the
prepayment occurs, (iii) Borrower delivers to Lender payment for Lender’s actual
fees and costs (including reasonable attorney’s fees) incurred in connection
with such prepayment, and (iv) if a partial prepayment, such prepayment shall
result in, as of the Anticipated Repayment Date, either (A) the Loan being paid
in full, including payment of all amounts due under this Note and each other
Loan Document, or (B) the OPB to equal or exceed $500,000.00, it being the
intent that if the Loan is not paid in full on or before the Anticipated

 

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Repayment Date, the OPB of the Loan as of the Anticipated Repayment Date is at
least in the amount of $500,000.00. Any prepayment made in accordance with the
immediately preceding sentence may be made without payment of the Yield
Maintenance Amount.

(iii) Notwithstanding Section 9(a)(i) to the contrary, after the Anticipated
Repayment Date, provided no Event of Default has occurred and is continuing,
Borrower may prepay the Loan in whole (but not in part) on any Business Day
prior to the Maturity Date so long as (i) Borrower provides notice to Lender of
the anticipated prepayment no less than thirty (30) days and no more than sixty
(60) days prior to the Prepayment Date, (ii) if the Prepayment Date does not
occur on a Payment Date, Borrower’s actual payment to Lender includes interest
for the full Accrual Period during which the prepayment occurs, (iii) Borrower
delivers to Lender payment for Lender’s actual fees and costs (including
reasonable attorney’s fees) incurred in connection with such prepayment, and
(iv) Borrower delivers to Lender the Yield Maintenance Amount and payment of all
other sums then due under this Note, the Pledge Agreement and the other Loan
Documents.

(b) Mandatory Prepayments. To the extent that Lender receives any Net Proceeds
in accordance with the Loan Agreement and the Net Proceeds are applied against
the Outstanding Principal Balance of the Loan in accordance with the Loan
Agreement, Borrower authorizes Lender, at Lender’s option, to apply Net Proceeds
as a prepayment of all or a portion of the outstanding principal balance of the
Loan together with accrued interest and any other sums due hereunder in an
amount equal to one hundred percent (100%) of such Net Proceeds; provided,
however, if an Event of Default has occurred and is continuing, Lender may apply
such Net Proceeds to the Debt (until paid in full) in any order or priority in
its discretion. Other than following an Event of Default, no Yield Maintenance
Amount shall be due in connection with any prepayment made pursuant to this
Section 9(b).

(c) Prepayments. If (i) after the occurrence and during the continuance of an
Event of Default, payment of all or any part of the Debt is tendered by Borrower
or otherwise recovered by Lender under any circumstances (including through
application of any Reserve Funds, as defined in the Loan Agreement), or (ii) any
partial prepayment of the Debt occurs after the Anticipated Repayment Date, in
either such event, such tender or recovery shall be deemed (a) to have been made
on the next occurring Payment Date together with the Monthly Debt Service
Payment Amount, and (b) to be a voluntary prepayment by Borrower in violation of
the prohibition against prepayment set forth herein, and Borrower shall pay, in
addition to the Debt, an amount equal to the Yield Maintenance Amount, which can
be applied by Lender in such order and priority as Lender shall determine in its
discretion. The Yield Maintenance Amount shall be secured by all security and
collateral for the Loan and shall, after it becomes due and payable, be treated
as if it were added to the Debt for all purposes including accrual of interest,
judgment on the Note, foreclosure, and bankruptcy (including pursuant to
Section 506 of the United States Bankruptcy Code or any successor provision);
without limiting the generality of the foregoing, it is understood and agreed
that the Yield Maintenance Amount may be added to Lender’s bid at any
foreclosure. If a Yield Maintenance Amount is due hereunder, Lender shall
deliver to Borrower a statement setting forth the amount and determination of
the Yield Maintenance Amount, and, provided that Lender shall have in good faith
applied the formula

 

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described in the definition of “Yield Maintenance Amount”, Borrower shall not
have the right to challenge the calculation or the method of calculation set
forth in any such statement in the absence of manifest error, which calculation
may be made by Lender on any day during the thirty (30) day period preceding the
date of such prepayment. Exchange of the Note for a different instrument or
modification of the terms of the Note, including classification and treatment of
Lender’s claim (other than non-impairment under Section 1124 of the United
States Bankruptcy Code or any successor provision) pursuant to a plan of
reorganization in bankruptcy shall also be deemed to be a prepayment following
an Event of Default hereunder.

(e) “Yield Maintenance Amount” means the present value, as of the Prepayment
Date, of the remaining scheduled payments of principal and interest from the
Prepayment Date through the Maturity Date (including any balloon payment)
determined by discounting such payments at the Discount Rate (hereinafter
defined), less the amount of principal being prepaid. The term “Discount Rate”
shall mean the rate that, when compounded monthly, is equivalent to the Treasury
Rate (hereinafter defined) when compounded semi-annually. The term “Treasury
Rate” shall mean the yield calculated by the linear interpolation of the yields,
as reported in Federal Reserve Statistical Release H.15-Selected Interest Rates
under the heading U.S. Government Securities/Treasury Constant Maturities for
the week ending prior to the Prepayment Date, of U.S. Treasury constant
maturities with maturity dates (one longer and one shorter) most nearly
approximating the Maturity Date. (If Release H.15 is no longer published, Lender
shall select a comparable publication to determine the Treasury Rate.)

(f) General.

(i) Borrower acknowledges that: (A) Lender has made the Loan to Borrower in
reliance on, and the Loan has been originated for the purpose of selling the
Loan in the secondary market to investors who will purchase the Loan or direct
or indirect interests therein in reliance on, the actual receipt over time of
the stream of payments of principal and interest agreed to by Borrower herein;
and (B) Lender or any subsequent investor in the Loan will incur substantial
additional costs and expenses in the event of a prepayment of the Loan; and
(C) the Yield Maintenance Amount is reasonable and is a bargained for
consideration and not a penalty and the terms of the Loan are in various
respects more favorable to Borrower than they would have been absent Borrower’s
agreement to pay the Yield Maintenance Amount as provided herein. Borrower
agrees that Lender shall not, as a condition to receiving the Yield Maintenance
Amount, be obligated to actually reinvest the amount prepaid in any treasury
obligation or in any other manner whatsoever. Nothing contained herein shall be
deemed to be a waiver by Lender of any right it may have to require specific
performance of any obligation of Borrower hereunder.

(ii) In addition to the Yield Maintenance Amount, Borrower shall pay all hedging
and breakage costs of any kind and in any amount incurred by Lender due to any
prepayment (including a prepayment following an Event of Default).

10. Maximum Rate Permitted by Law. All agreements in this Note and all other
Loan Documents are expressly limited so that in no contingency or event
whatsoever, whether by reason of acceleration of maturity of the indebtedness
evidenced hereby or otherwise, shall the amount agreed to be paid hereunder for
the use, forbearance, or detention of money exceed

 

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the highest lawful rate permitted under applicable usury laws. If, from any
circumstance whatsoever, fulfillment of any provision of this Note or any other
Loan Document at the time performance of such provision shall be due shall
involve exceeding any usury limit prescribed by law that a court of competent
jurisdiction may deem applicable hereto, then, ipso facto, the obligations to be
fulfilled shall be reduced to allow compliance with such limit, and if, from any
circumstance whatsoever, Lender shall ever receive as interest an amount that
would exceed the highest lawful rate, the receipt of such excess shall be deemed
a mistake and shall be canceled automatically or, if theretofore paid, such
excess shall be credited against the principal amount of the indebtedness
evidenced hereby to which the same may lawfully be credited, and any portion of
such excess not capable of being so credited shall be refunded immediately to
Borrower.

11. Events of Default; Acceleration of Amount Due. Lender may in its discretion,
without notice to Borrower, declare the entire Debt, including the Outstanding
Principal Balance, all accrued interest, all costs, expenses, charges and fees
payable under any Loan Document, and prepayment consideration immediately due
and payable, and Lender shall have all remedies available to it at law or equity
for collection of the amounts due, if any of the following (the “Events of
Default”) occurs:

(a) Borrower fails to pay any portion of the Debt when due; or

(b) an “Event of Default” (as defined in the Loan Agreement or in any other Loan
Document) occurs under the Loan Agreement or any other Loan Document that has
continued beyond any applicable cure period therefor.

12. Time of Essence. Time is of the essence with regard to each provision
contained in this Note.

13. Transfer and Assignment. This Note may be freely transferred and assigned by
Lender. Borrower’s right to transfer its rights and obligations with respect to
the Debt, and to be released from liability under this Note, shall be governed
by the Loan Agreement.

14. Authority of Persons Executing Note. Borrower warrants and represents that
the persons or officers who are executing this Note and the other Loan Documents
on behalf of Borrower have full right, power and authority to do so, and that
this Note and the other Loan Documents constitute valid and binding documents,
enforceable against Borrower in accordance with their terms, and that no other
person, entity, or party is required to sign, approve, or consent to, this Note.

15. Severability. The terms of this Note are severable, and should any provision
be declared by a court of competent jurisdiction to be invalid or unenforceable,
the remaining provisions shall, at the option of Lender, remain in full force
and effect and shall in no way be impaired.

16. Borrower’s Waivers. Borrower and all others liable hereon hereby waive
presentation for payment, demand, notice of dishonor, protest, and notice of
protest, notice of intent to accelerate, and notice of acceleration, stay of
execution and all other suretyship defenses to payment generally. No release of
any security held for the payment of this Note, or extension of any time periods
for any payments due hereunder, or release of collateral that may be granted

 

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by Lender from time to time, and no alteration, amendment or waiver of any
provision of this Note or of any of the other Loan Documents, shall modify,
waive, extend, change, discharge, terminate or affect the liability of Borrower
and any others that may at any time be liable for the payment of this Note or
the performance of any covenants contained in any of the Loan Documents.

17. Governing Law. This Note shall be governed and construed generally according
to the laws of the State of New York, without regard to the conflicts of law
provisions thereof (“Governing State”).

18. JURISDICTION AND VENUE. BORROWER HEREBY CONSENTS TO PERSONAL JURISDICTION IN
THE GOVERNING STATE. VENUE OF ANY ACTION BROUGHT TO ENFORCE THIS NOTE OR ANY
OTHER LOAN DOCUMENT OR ANY ACTION RELATING TO THE LOAN OR THE DEBT OR THE
RELATIONSHIPS CREATED BY OR UNDER THE LOAN DOCUMENTS (“ACTION”) SHALL, AT THE
ELECTION OF LENDER, BE IN (AND IF ANY ACTION IS ORIGINALLY BROUGHT IN ANOTHER
VENUE, THE ACTION SHALL AT THE ELECTION OF LENDER BE TRANSFERRED TO) A STATE OR
FEDERAL COURT OF APPROPRIATE JURISDICTION LOCATED IN THE GOVERNING STATE.
BORROWER HEREBY CONSENTS AND SUBMITS TO THE PERSONAL JURISDICTION OF THE STATE
COURTS OF THE GOVERNING STATE AND OF FEDERAL COURTS LOCATED IN THE GOVERNING
STATE IN CONNECTION WITH ANY ACTION AND HEREBY WAIVES ANY AND ALL PERSONAL
RIGHTS UNDER THE LAWS OF ANY OTHER STATE TO OBJECT TO JURISDICTION WITHIN SUCH
STATE FOR PURPOSES OF ANY ACTION. Borrower hereby waives and agrees not to
assert, as a defense to any Action or a motion to transfer venue of any Action,
(i) any claim that it is not subject to such jurisdiction, (ii) any claim that
any Action may not be brought against it or is not maintainable in those courts
or that this Note or any of the other Loan Documents may not be enforced in or
by those courts, or that it is exempt or immune from execution, (iii) that the
Action is brought in an inconvenient forum, or (iv) that the venue for the
Action is in any way improper.

19. Notices. All notices, consents, approvals and requests required or permitted
hereunder or under any other Loan Document shall be given in writing and shall
be effective for all purposes if hand delivered or sent by (a) certified or
registered United States mail, postage prepaid, return receipt requested or
(b) expedited prepaid delivery service, either commercial or United States
Postal Service, with proof of attempted delivery, or (c) by telecopier (with
answer back acknowledged), and with a second copy to be sent to the intended
recipient by an other means permitted under this Section, addressed as follows
(or at such other address and Person as shall be designated from time to time by
any party hereto, as the case may be, in a written notice to the other parties
hereto in the manner provided for in this Section):

 

If to Lender:    KeyBank National Association    11501 Outlook, Suite 300   
Overland Park, Kansas 66211    Facsimile No.: 877-379-1625    Attention: Loan
Servicing

 

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with a copy to:    Daniel Flanigan, Esq.    Polsinelli Shughart PC    700 W.
47th Street, Suite 1000    Kansas City, Missouri 64112    Facsimile No.: (816)
753-1536 If to Borrower:    c/o Thompson National Properties, LLC    1900 Main
Street, Suite 700    Irvine, California 92614    Attention: Ido Dotan   
Facsimile No.: (949) 271-4915 With a copy to:    Kaplan Voekler Cunningham &
Frank PLC    7 East 2nd Street    Richmond, Virginia 23218-2470    Attention:
Thomas Voekler    Facsimile No.: (804) 525-1794

A notice shall be deemed to have been given: in the case of hand delivery, at
the time of delivery; in the case of registered or certified mail, when
delivered or the first attempted delivery on a Business Day; or in the case of
expedited prepaid delivery, upon the first attempted delivery on a Business Day;
or in the case of telecopy, upon sender’s receipt of a machine-generated
confirmation of successful transmission after advice by telephone to recipient
that a telecopy notice is forthcoming.

20. Avoidance of Debt Payments. To the extent that any payment to Lender and/or
any payment or proceeds of any collateral received by Lender in reduction of the
Debt is subsequently invalidated, declared to be fraudulent or preferential, set
aside and/or required to be repaid to a trustee, to Borrower (or Borrower’s
successor) as a debtor in possession, or to a receiver, creditor, or any other
party under any bankruptcy law, state or federal law, common law or equitable
cause, then the portion of the Debt intended to have been satisfied by such
payment or proceeds shall remain due and payable hereunder, be evidenced by this
Note, and shall continue in full force and effect as if such payment or proceeds
had never been received by Lender whether or not this Note has been marked
“paid” or otherwise cancelled or satisfied and/or has been delivered to
Borrower, and in such event Borrower shall be immediately obligated to return
the original Note to Lender and any marking of “paid” or other similar marking
shall be of no force and effect.

21. Intentionally Omitted.

22. Miscellaneous. Neither this Note nor any of the terms hereof, including the
provisions of this Section, may be terminated, amended, supplemented, waived or
modified orally, but only by an instrument in writing executed by the party
against which enforcement of the termination, amendment, supplement, waiver or
modification is sought, and the parties hereby: (a) expressly agree that it
shall not be reasonable for any of them to rely on any alleged, non-written
amendment to this Note; (b) irrevocably waive any and all right to enforce any
alleged, non-written amendment to this Note; and (c) expressly agree that it
shall be beyond the

 

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scope of authority (apparent or otherwise) for any of their respective agents to
agree to any non-written modification of this Note. This Note may be executed in
several counterparts, each of which counterpart shall be deemed an original
instrument and all of which together shall constitute a single Note. The failure
of any party hereto to execute this Note, or any counterpart hereof, shall not
relieve the other signatories from their obligations hereunder. If Borrower
consists of more than one person or entity, then the obligations and liabilities
of each person or entity shall be joint and several and in such case, the term
“Borrower” shall mean individually and collectively, jointly and severally, each
Borrower. As used in this Note, (i) the terms “include,” “including” and similar
terms shall be construed as if followed by the phrase “without being limited
to,” (ii) any pronoun used herein shall be deemed to cover all genders, and
words importing the singular number shall mean and include the plural number,
and vice versa, (iii) all captions to the Sections hereof are used for
convenience and reference only and in no way define, limit or describe the scope
or intent of, or in any way affect, this Note, (iv) no inference in favor of, or
against, Lender or Borrower shall be drawn from the fact that such party has
drafted any portion hereof or any other Loan Document, (v) the words “Lender”
and “Borrower” shall include their respective successors (including, in the case
of Borrower, any subsequent owner or owners of the Collateral or any part
thereof or any interest therein and Borrower in its capacity as
debtor-in-possession after the commencement of any bankruptcy proceeding),
assigns, heirs, personal representatives, executors and administrators, (vi) the
term “or” has, except where otherwise indicated, the inclusive meaning
represented by the phrase “and/or,” (vii) the words “hereof,” “herein,”
“hereby,” “hereunder,” and similar terms in this Note refer to this Note as a
whole and not to any particular provision or section of this Note, (viii) an
Event of Default shall “continue” or be “continuing” until such Event of Default
has been waived in writing by Lender, (ix) in the computation of periods of time
from a specified date to a later date, the word “from and including” and the
words “to” and “until” each means “to but excluding”. Wherever Lender’s
judgment, consent, approval or discretion is required under this Note or Lender
shall have an option, election, or right of determination or any other power to
decide any other matter relating to the terms of this Note, including any right
to determine that something is satisfactory or not (“Decision Power”), such
Decision Power shall be exercised in the sole and absolute discretion of Lender
except as may be otherwise expressly and specifically provided herein. Such
Decision Power and each other power granted to Lender upon this Note or any
other Loan Document may be exercised by Lender or by any authorized agent of
Lender (including any servicer and/or attorney-in-fact), and Borrower hereby
expressly agrees to recognize the exercise of such Decision Power by such
authorized agent. In the event of a conflict between or among the terms,
covenants, conditions or provisions of the Loan Documents, the term(s),
covenant(s), condition(s) and/or provision(s) that Lender may elect to enforce
from time to time so as to enlarge the interest of Lender in its security,
afford Lender the maximum financial benefits or security for the Debt, and/or
provide Lender the maximum assurance of payment of the Debt in full shall
control. BORROWER ACKNOWLEDGES AND AGREES THAT IT HAS BEEN PROVIDED WITH
SUFFICIENT AND NECESSARY TIME AND OPPORTUNITY TO REVIEW THE TERMS OF THIS NOTE,
THE LOAN AGREEMENT, THE PLEDGE AGREEMENT, AND EACH OF THE LOAN DOCUMENTS, WITH
ANY AND ALL COUNSEL IT DEEMS APPROPRIATE, AND THAT NO INFERENCE IN FAVOR OF, OR
AGAINST, LENDER OR BORROWER SHALL BE DRAWN FROM THE FACT THAT EITHER SUCH PARTY
HAS DRAFTED ANY PORTION HEREOF, OR ANY OF THE LOAN DOCUMENTS.

 

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23. Waiver of Counterclaim and Jury Trial. BORROWER HEREBY KNOWINGLY WAIVES THE
RIGHT TO ASSERT ANY COUNTERCLAIM, OTHER THAN A COMPULSORY COUNTERCLAIM, IN ANY
ACTION OR PROCEEDING BROUGHT AGAINST BORROWER BY LENDER OR ITS AGENTS.
ADDITIONALLY, TO THE EXTENT NOW OR HEREAFTER PERMITTED BY APPLICABLE LAW,
BORROWER AND LENDER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY
RIGHT THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED ON THE
LOAN OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH THE LOAN, THIS NOTE OR ANY
OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENT
(WHETHER VERBAL OR WRITTEN), OR ACTION OF BORROWER OR LENDER. THIS PROVISION IS
A MATERIAL INDUCEMENT FOR LENDER’S MAKING OF THE LOAN.

24. Local Law Provisions. In the event of any inconsistencies between the terms
and conditions of this Section and any other terms and conditions of this Note
(other than the terms and conditions of Section 25), the terms and conditions of
this Section shall be binding.

NONE.

25. Additional Provisions. In the event of any inconsistencies between the terms
and conditions of this Section and any other terms and conditions of this Note,
the terms and conditions of this Section shall be binding.

NONE

 

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Intending to be fully bound, Borrower has executed this Note effective as of the
day and year first above written.

 

Borrower:     TNP SRT PORTFOLIO II HOLDINGS, LLC,     a Delaware limited
liability company     By:   TNP Strategic Retail Operating Partnership, LP, a
Delaware limited partnership, its sole member       By:   TNP Strategic Retail
Trust, Inc., a Maryland corporation, its general partner         By:  

/s/ Anthony W. Thompson

        Name:   Anthony W. Thompson         Title:   CEO

 

SIGNATURE PAGE TO PROMISSORY NOTE (MEZZANINE)