Exhibit 10.4
Prepared by, and after recording
return to:
PNC Bank, National Association
10731 Treena Street, Suite 101
San Diego, CA 92131
Attention: Kelli A. Tyler
PNC Loan No. 310401114
Fannie Mae No. 865151
MULTIFAMILY MORTGAGE,
ASSIGNMENT OF LEASES AND RENTS,
SECURITY AGREEMENT
AND FIXTURE FILING
(KANSAS)

          Fannie Mae Multifamily Security Instrument
Kansas   Form 6025.KS
01-11   © 2011 Fannie Mae

 

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TABLE OF CONTENTS

                          PAGE      
 
        1.    
DEFINED TERMS
    2        
 
        2.    
SECURITY AGREEMENT; FIXTURE FILING
    6        
 
        3.    
ASSIGNMENT OF LEASES AND RENTS; APPOINTMENT OF RECEIVER; LENDER IN POSSESSION
    7        
 
        4.    
PROTECTION OF LENDER’S SECURITY
    10        
 
        5.    
NO OTHER INDEBTEDNESS AND MEZZANINE FINANCING
    11        
 
        6.    
DEFAULT; ACCELERATION; REMEDIES
    11        
 
        7.    
WAIVER OF STATUTE OF LIMITATIONS AND MARSHALING
    13        
 
        8.    
WAIVER OF REDEMPTION; RIGHTS OF TENANTS
    13        
 
        9.    
NOTICE
    14        
 
        10.    
MORTGAGEE-IN-POSSESSION
    15        
 
        11.    
RELEASE
    15        
 
        12.    
GOVERNING LAW; CONSENT TO JURISDICTION AND VENUE
    15        
 
        13.    
MISCELLANEOUS PROVISIONS
    15        
 
        14.    
TIME IS OF THE ESSENCE
    17        
 
        15.    
WAIVER OF TRIAL BY JURY
    17        
 
        16.    
ACKNOWLEDGMENT OF RECEIPT
    17  

          Fannie Mae Multifamily Security Instrument
Kansas   Form 6025.KS
01-11   Page i
© 2011 Fannie Mae

 

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MULTIFAMILY MORTGAGE,
ASSIGNMENT OF LEASES AND RENTS,
SECURITY AGREEMENT
AND FIXTURE FILING
     This MULTIFAMILY MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY
AGREEMENT AND FIXTURE FILING (as amended, restated, replaced, supplemented, or
otherwise modified from time to time, the “Security Instrument”) dated as of
June 28, 2011, is executed by SIR CLARION PARK, LLC, a limited liability
company, organized and existing under the laws of Delaware, as mortgagor
(“Borrower”), to and for the benefit of PNC BANK, NATIONAL ASSOCIATION, a
national banking association, as mortgagee (“Lender”).
     Borrower, in consideration of (i) the loan in the original principal amount
of $8,972,000.00 (the “Mortgage Loan”) evidenced by that certain Multifamily
Note dated as of the date of this Security Instrument, executed by Borrower and
made payable to the order of Lender (as amended, restated, replaced,
supplemented, or otherwise modified from time to time, the “Note”), and (ii)
that certain Multifamily Loan and Security Agreement dated as of the date of
this Security Instrument, executed by and between Borrower and Lender (as
amended, restated, replaced, supplemented or otherwise modified from time to
time, the “Loan Agreement”), and to secure to Lender the repayment of the
Indebtedness (as defined in this Security Instrument), and all renewals,
extensions and modifications thereof, and the performance of the covenants and
agreements of Borrower contained in the Loan Documents (as defined in the Loan
Agreement), excluding the Environmental Indemnity Agreement (as defined in this
Security Instrument), irrevocably and unconditionally mortgages, grants,
assigns, remises, releases, warrants and conveys to and for the benefit of
Lender the Mortgaged Property (as defined in this Security Instrument),
including the real property located in the County of Johnson, State of Kansas,
and described in Exhibit A attached to this Security Instrument and incorporated
by reference (the “Land”), to have and to hold such Mortgaged Property unto
Lender and Lender’s successors and assigns, forever; Borrower hereby releasing,
relinquishing and waiving, to the fullest extent allowed by law, all rights and
benefits, if any, under and by virtue of the homestead exemption laws of the
Property Jurisdiction (as defined in this Security Instrument), if applicable.
     Borrower represents and warrants that Borrower is lawfully seized of the
Mortgaged Property and has the right, power and authority to mortgage, grant,
assign, remise, release, warrant and convey the Mortgaged Property, and that the
Mortgaged Property is not encumbered by any Lien (as defined in this Security
Instrument) other than Permitted Encumbrances (as defined in this Security
Instrument). Borrower covenants that Borrower will warrant and defend the title
to the Mortgaged Property against all claims and demands other than Permitted
Encumbrances.

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Kansas   Form 6025.KS
01-11   Page 1
© 2011 Fannie Mae

 

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     Borrower and Lender, by its acceptance hereof, each covenants and agrees as
follows:
1. Defined Terms.
     Capitalized terms used and not specifically defined herein have the
meanings given to such terms in the Loan Agreement. All terms used and not
specifically defined herein, but which are otherwise defined by the UCC, shall
have the meanings assigned to them by the UCC. The following terms, when used in
this Security Instrument, shall have the following meanings:
“Condemnation Action” means any action or proceeding, however characterized or
named, relating to any condemnation or other taking, or conveyance in lieu
thereof, of all or any part of the Mortgaged Property, whether direct or
indirect.
“Enforcement Costs” means all expenses and costs, including reasonable
attorneys’ fees and expenses, fees and out-of-pocket expenses of expert
witnesses and costs of investigation, incurred by Lender as a result of any
Event of Default under the Loan Agreement or in connection with efforts to
collect any amount due under the Loan Documents, or to enforce the provisions of
the Loan Agreement or any of the other Loan Documents, including those incurred
in post-judgment collection efforts and in any bankruptcy or insolvency
proceeding (including any action for relief from the automatic stay of any
bankruptcy proceeding or Foreclosure Event) or judicial or non-judicial
foreclosure proceeding, to the extent permitted by law.
“Environmental Indemnity Agreement” means that certain Environmental Indemnity
Agreement dated as of the date of this Security Instrument, executed by Borrower
to and for the benefit of Lender, as the same may be amended, restated,
replaced, supplemented, or otherwise modified from time to time.
“Environmental Laws” has the meaning set forth in the Environmental Indemnity
Agreement.
“Event of Default” has the meaning set forth in the Loan Agreement.
“Fixtures” means all Goods that are so attached or affixed to the Land or the
Improvements as to constitute a fixture under the laws of the Property
Jurisdiction.
“Goods” means all goods which are used now or in the future in connection with
the ownership, management, or operation of the Land or the Improvements or are
located on the Land or in the Improvements, including inventory; furniture;
furnishings; machinery, equipment, engines, boilers, incinerators, and installed
building materials; systems and equipment for the purpose of supplying or
distributing heating, cooling, electricity, gas, water, air, or light; antennas,
cable, wiring, and conduits used in connection with radio, television, security,
fire prevention, or fire detection, or otherwise used to carry electronic
signals; telephone systems and equipment; elevators and related machinery and
equipment; fire detection, prevention and extinguishing systems and apparatus;
security and access control systems and apparatus; plumbing systems;

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Kansas   Form 6025.KS
01-11   Page 2
© 2011 Fannie Mae

 

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water heaters, ranges, stoves, microwave ovens, refrigerators, dishwashers,
garbage disposers, washers, dryers, and other appliances; light fixtures,
awnings, storm windows, and storm doors; pictures, screens, blinds, shades,
curtains, and curtain rods; mirrors, cabinets, paneling, rugs, and floor and
wall coverings; fences, trees, and plants; swimming pools; exercise equipment;
supplies; tools; books and records (whether in written or electronic form);
websites, URLs, blogs, and social network pages; computer equipment (hardware
and software); and other tangible personal property which is used now or in the
future in connection with the ownership, management, or operation of the Land or
the Improvements or are located on the Land or in the Improvements.
“Imposition Deposits” means deposits in an amount sufficient to accumulate with
Lender the entire sum required to pay the Impositions when due.
“Impositions” means
     (a) any water and sewer charges which, if not paid, may result in a lien on
all or any part of the Mortgaged Property;
     (b) the premiums for fire and other casualty insurance, liability
insurance, rent loss insurance and such other insurance as Lender may require
under the Loan Agreement;
     (c) Taxes; and
     (d) amounts for other charges and expenses which Lender at any time
reasonably deems necessary to protect the Mortgaged Property, to prevent the
imposition of liens on the Mortgaged Property, or otherwise to protect Lender’s
interests, all as reasonably determined from time to time by Lender.
“Improvements” means the buildings, structures, improvements, and alterations
now constructed or at any time in the future constructed or placed upon the
Land, including any future replacements, facilities, and additions and other
construction on the Land.
“Indebtedness” means the principal of, interest on, and all other amounts due at
any time under the Note, the Loan Agreement, this Security Instrument or any
other Loan Document (other than the Environmental Indemnity Agreement and
Guaranty), including Prepayment Premiums, late charges, default interest, and
accrued interest as provided in the Loan Agreement and this Security Instrument,
advances, costs and expenses to perform the obligations of Borrower or to
protect the Mortgaged Property or the security of this Security Instrument, all
other monetary obligations of Borrower under the Loan Documents (other than the
Environmental Indemnity Agreement), including amounts due as a result of any
indemnification obligations, and any Enforcement Costs.
“Land” means the real property described in Exhibit A.

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Kansas   Form 6025.KS
01-11   Page 3
© 2011 Fannie Mae

 

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“Leases” means all present and future leases, subleases, licenses, concessions
or grants or other possessory interests now or hereafter in force, whether oral
or written, covering or affecting the Mortgaged Property, or any portion of the
Mortgaged Property (including proprietary leases or occupancy agreements if
Borrower is a cooperative housing corporation), and all modifications,
extensions or renewals thereof.
“Lien” means any claim or charge against property for payment of a debt or an
amount owed for services rendered, including any mortgage, deed of trust, deed
to secure debt, security interest, tax lien, any materialman’s or mechanic’s
lien, or any lien of a Governmental Authority, including any lien in connection
with the payment of utilities, or any other encumbrance.
“Mortgaged Property” means all of Borrower’s present and hereafter acquired
right, title and interest in and to all of the following:
     (a) the Land;
     (b) the Improvements;
     (c) the Personalty;
     (d) current and future rights, including air rights, development rights,
zoning rights and other similar rights or interests, easements, tenements,
rights-of-way, strips and gores of land, streets, alleys, roads, sewer rights,
waters, watercourses, and appurtenances related to or benefitting the Land or
the Improvements, or both, and all rights-of-way, streets, alleys and roads
which may have been or may in the future be vacated;
     (e) insurance policies relating to the Mortgaged Property (and any unearned
premiums) and all proceeds paid or to be paid by any insurer of the Land, the
Improvements, the Personalty, or any other part of the Mortgaged Property,
whether or not Borrower obtained the insurance pursuant to Lender’s
requirements;
     (f) awards, payments and other compensation made or to be made by any
municipal, state or federal authority with respect to the Land, the
Improvements, the Personalty, or any other part of the Mortgaged Property,
including any awards or settlements resulting from (1) Condemnation Actions,
(2) any damage to the Mortgaged Property caused by governmental action that does
not result in a Condemnation Action, or (3) the total or partial taking of the
Land, the Improvements, the Personalty, or any other part of the Mortgaged
Property under the power of eminent domain or otherwise and including any
conveyance in lieu thereof;
     (g) contracts, options and other agreements for the sale of the Land, the
Improvements, the Personalty, or any other part of the Mortgaged Property
entered into by Borrower now or in the future, including cash or securities
deposited to secure performance by parties of their obligations;

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Kansas   Form 6025.KS
01-11   Page 4
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     (h) Leases and Lease guaranties, letters of credit and any other supporting
obligation for any of the Leases given in connection with any of the Leases, and
all Rents;
     (i) earnings, royalties, accounts receivable, issues and profits from the
Land, the Improvements or any other part of the Mortgaged Property, and all
undisbursed proceeds of the Mortgage Loan and, if Borrower is a cooperative
housing corporation, maintenance charges or assessments payable by shareholders
or residents;
     (j) Imposition Deposits;
     (k) refunds or rebates of Impositions by any municipal, state or federal
authority or insurance company (other than refunds applicable to periods before
the real property tax year in which this Security Instrument is dated);
     (l) tenant security deposits;
     (m) names under or by which any of the above Mortgaged Property may be
operated or known, and all trademarks, trade names, and goodwill relating to any
of the Mortgaged Property, excluding therefrom the names “SIR” and “Steadfast”
(or any derivation of either such name) and/or trademark rights associated with
such names or derivation thereof;
     (n) Collateral Accounts and all Collateral Account Funds;
     (o) products, and all cash and non-cash proceeds from the conversion,
voluntary or involuntary, of any of the above into cash or liquidated claims,
and the right to collect such proceeds; and
     (p) all of Borrower’s right, title and interest in the oil, gas, minerals,
mineral interests, royalties, overriding royalties, production payments, net
profit interests and other interests and estates in, under and on the Mortgaged
Property and other oil, gas and mineral interests with which any of the
foregoing interests or estates are pooled or unitized.
“Permitted Encumbrance” means only the easements or restrictions listed in a
schedule of exceptions to coverage in the Title Policy and Taxes for the current
tax year that are not yet due and payable.
“Personalty” means all Goods, accounts, choses of action, chattel paper,
documents, general intangibles (including Software), payment intangibles,
instruments, investment property, letter of credit rights, supporting
obligations, computer information, source codes, object codes, records and data,
all telephone numbers or listings, claims (including claims for indemnity or
breach of warranty), deposit accounts and other property or assets of any kind
or nature related to the Land or the Improvements now or in the future,
including operating agreements, surveys, plans and specifications and contracts
for architectural, engineering and construction services relating to the Land or
the Improvements, and all other intangible property and rights relating to the

          Fannie Mae Multifamily Security Instrument
Kansas   Form 6025.KS
01-11   Page 5
© 2011 Fannie Mae

 

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operation of, or used in connection with, the Land or the Improvements,
including all governmental permits relating to any activities on the Land.
“Prepayment Premium” has the meaning set forth in the Loan Agreement.
“Property Jurisdiction” means the jurisdiction in which the Land is located.
“Rents” means all rents (whether from residential or non-residential space),
revenues and other income from the Land or the Improvements, including subsidy
payments received from any sources, including payments under any “Housing
Assistance Payments Contract” or other rental subsidy agreement (if any),
parking fees, laundry and vending machine income and fees and charges for food,
health care and other services provided at the Mortgaged Property, whether now
due, past due, or to become due, and tenant security deposits.
“Software” means a computer program and any supporting information provided in
connection with a transaction relating to the program. The term does not include
any computer program that is included in the definition of Goods.
“Taxes” means all taxes, assessments, vault rentals and other charges, if any,
general, special or otherwise, including assessments for schools, public
betterments and general or local improvements, which are levied, assessed or
imposed by any public authority or quasi-public authority, and which, if not
paid, may become a lien, on the Land or the Improvements or any taxes upon any
Loan Document.
“Title Policy” has the meaning set forth in the Loan Agreement.
“UCC” means the Uniform Commercial Code in effect in the Property Jurisdiction,
as amended from time to time.
“UCC Collateral” means any or all of that portion of the Mortgaged Property,
whether acquired now or in the future, in which a security interest may be
granted under the UCC.
2. Security Agreement; Fixture Filing.
     (a) To secure to Lender, the repayment of the Indebtedness, and all
renewals, extensions and modifications thereof, and the performance of the
covenants and agreements of Borrower contained in the Loan Documents, Borrower
hereby pledges, assigns, and grants to Lender a continuing security interest in
the UCC Collateral. This Security Instrument constitutes a security agreement
and a financing statement under the UCC. This Security Instrument also
constitutes a financing statement pursuant to the terms of the UCC with respect
to any part of the Mortgaged Property that is or may become a Fixture under
applicable law, and will be recorded as a “fixture filing” in accordance with
the UCC. Borrower hereby authorizes Lender to file financing statements,
continuation statements and financing statement amendments in such form as
Lender may require to perfect or continue the perfection of this security
interest without the

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Kansas   Form 6025.KS
01-11   Page 6
© 2011 Fannie Mae

 

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signature of Borrower. From and after the occurrence of an Event of Default,
Lender shall have the remedies of a secured party under the UCC, in addition to
all remedies provided by this Security Instrument existing under applicable law.
Lender may exercise any or all of its remedies against the UCC Collateral
separately or together, and in any order, without in any way affecting the
availability or validity of Lender’s other remedies. For purposes of the UCC,
the debtor is Borrower and the secured party is Lender. The name and address of
the debtor and secured party are set forth after Borrower’s signature below
which are the addresses from which information on the security interest may be
obtained.
     (b) Borrower represents and warrants that: (1) Borrower maintains its chief
executive office at the location set forth after Borrower’s signature below, and
Borrower will notify Lender in writing of any change in its chief executive
office within five (5) days of such change; (2) Borrower is the record owner of
the Mortgaged Property; (3) Borrower’s state of incorporation, organization, or
formation, if applicable, is as set forth on Page 1 of this Security Instrument;
(4) Borrower’s exact legal name is as set forth on Page 1 of this Security
Instrument; (5) Borrower’s organizational identification number, if applicable,
is as set forth after Borrower’s signature below; (6) Borrower is the owner of
the UCC Collateral subject to no liens, charges or encumbrances other than the
lien hereof; (7) except for items removed, disposed of and/or replaced in the
ordinary course of Borrower’s business, the UCC Collateral will not be removed
from the Mortgaged Property without the consent of Lender; and (8) no financing
statement covering any of the UCC Collateral or any proceeds thereof is on file
in any public office except pursuant hereto.
     (c) All property of every kind acquired by Borrower after the date of this
Security Instrument which by the terms of this Security Instrument shall be
subject to the lien and the security interest created hereby, shall immediately
upon the acquisition thereof by Borrower and without further conveyance or
assignment become subject to the lien and security interest created by this
Security Instrument. Nevertheless, Borrower shall execute, acknowledge, deliver
and record or file, as appropriate, all and every such further deeds of trust,
mortgages, deeds to secure debt, security agreements, financing statements,
assignments and assurances as Lender shall require for accomplishing the
purposes of this Security Instrument and to comply with the rerecording
requirements of the UCC.
3. Assignment of Leases and Rents; Appointment of Receiver; Lender in
Possession.
     (a) As part of the consideration for the Indebtedness, Borrower absolutely
and unconditionally assigns and transfers to Lender all Leases and Rents. It is
the intention of Borrower to establish present, absolute and irrevocable
transfers and assignments to Lender of all Leases and Rents and to authorize and
empower Lender to collect and receive all Rents without the necessity of further
action on the part of Borrower. Borrower and Lender intend the assignments of
Leases and Rents to be effective immediately and to constitute absolute present
assignments, and not assignments for additional security only. Only for purposes
of giving effect to these absolute assignments of Leases and Rents, and for no
other purpose, the Leases

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Kansas   Form 6025.KS
01-11   Page 7
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and Rents shall not be deemed to be a part of the Mortgaged Property. However,
if these present, absolute and unconditional assignments of Leases and Rents are
not enforceable by their terms under the laws of the Property Jurisdiction, then
each of the Leases and Rents shall be included as part of the Mortgaged
Property, and it is the intention of Borrower, in such circumstance, that this
Security Instrument create and perfect a lien on each of the Leases and Rents in
favor of Lender, which liens shall be effective as of the date of this Security
Instrument.
     (b) Until the occurrence of an Event of Default, but subject to the
limitations set forth in the Loan Documents, Borrower shall have a revocable
license to exercise all rights, power and authority granted to Borrower under
the Leases (including the right, power and authority to modify the terms of any
Lease or extend or terminate any Lease subject to the limitations set forth in
the Loan Documents), and to collect and receive all Rents, to hold all Rents in
trust for the benefit of Lender, and to apply all Rents to pay the Monthly Debt
Service Payments and the other amounts then due and payable under the other Loan
Documents, including Imposition Deposits, and to pay the current costs and
expenses of managing, operating and maintaining the Mortgaged Property,
including utilities and Impositions (to the extent not included in Imposition
Deposits), tenant improvements and other capital expenditures. So long as no
Event of Default has occurred, the Rents remaining after application pursuant to
the preceding sentence may be retained by Borrower free and clear of, and
released from, Lender’s rights with respect to Rents under this Security
Instrument.
     (c) From and after the occurrence of an Event of Default that has not been
cured to Lender’s satisfaction, without the necessity of Lender entering upon
and taking and maintaining control of the Mortgaged Property directly, by a
receiver, or by any other manner or proceeding permitted by the laws of the
Property Jurisdiction, the revocable license granted to Borrower pursuant to
Section 3(b) shall automatically terminate, and Lender shall immediately have
all rights, powers and authority granted to Borrower under any Lease (including
the right, power and authority to modify the terms of any such Lease, or extend
or terminate any such Lease) and, without notice, Lender shall be entitled to
all Rents as they become due and payable, including Rents then due and unpaid.
From and after the occurrence of an Event of Default that has not been cured to
Lender’s satisfaction, Borrower authorizes Lender to collect, sue for and
compromise Rents and directs each tenant of the Mortgaged Property to pay all
Rents to, or as directed by, Lender, and Borrower shall, upon (i) Borrower’s
receipt of any Rents from any sources, and (ii) such direction from Lender, pay
the total amount of such receipts to Lender. Although the foregoing rights of
Lender are self-effecting, at any time from and after the occurrence of an Event
of Default that has not been cured to Lender’s satisfaction, Lender may make
demand for all Rents, and Lender may give, and Borrower hereby irrevocably
authorizes Lender to give, notice to all tenants of the Mortgaged Property
instructing them to pay all Rents to Lender. No tenant shall be obligated to
inquire further as to the occurrence or continuance of an Event of Default, and
no tenant shall be obligated to pay to Borrower any amounts that are actually
paid to Lender in response to such a notice. Any such notice by Lender shall be
delivered to each tenant personally, by mail or by delivering such demand to
each rental unit.

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Kansas   Form 6025.KS
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     (d) From and after the occurrence of an Event of Default that has not been
cured to Lender’s satisfaction, Lender may, regardless of the adequacy of
Lender’s security or the solvency of Borrower, and even in the absence of waste,
enter upon, take and maintain full control of the Mortgaged Property, and may
exclude Borrower and its agents and employees therefrom, in order to perform all
acts that Lender, in its discretion, determines to be necessary or desirable for
the operation and maintenance of the Mortgaged Property, including the
execution, cancellation or modification of Leases, the collection of all Rents
(including through use of a lockbox, at Lender’s election), the making of
repairs to the Mortgaged Property and the execution or termination of contracts
providing for the management, operation or maintenance of the Mortgaged
Property, for the purposes of enforcing this assignment of Rents, protecting the
Mortgaged Property or the security of this Security Instrument and the Mortgage
Loan, or for such other purposes as Lender in its discretion may deem necessary
or desirable.
     (e) Notwithstanding any other right provided Lender under this Security
Instrument or any other Loan Document, if an Event of Default has occurred and
has not been cured to Lender’s satisfaction, and regardless of the adequacy of
Lender’s security or Borrower’s solvency, and without the necessity of giving
prior notice (oral or written) to Borrower, Lender may apply to any court having
jurisdiction for the appointment of a receiver for the Mortgaged Property to
take any or all of the actions set forth in Section 3. If Lender elects to seek
the appointment of a receiver for the Mortgaged Property at any time after an
Event of Default has occurred, Borrower, by its execution of this Security
Instrument, expressly consents to the appointment of such receiver, including
the appointment of a receiver ex parte, if permitted by applicable law. Borrower
consents to shortened time consideration of a motion to appoint a receiver.
Lender or the receiver, as applicable, shall be entitled to receive a reasonable
fee for managing the Mortgaged Property and such fee shall become an additional
part of the Indebtedness. Immediately upon appointment of a receiver or Lender’s
entry upon and taking possession and control of the Mortgaged Property,
possession of the Mortgaged Property and all documents, records (including
records on electronic or magnetic media), accounts, surveys, plans, and
specifications relating to the Mortgaged Property, and all security deposits and
prepaid Rents, shall be surrendered to Lender or the receiver, as applicable. If
Lender takes possession and control of the Mortgaged Property, Lender may
exclude Borrower and its representatives from the Mortgaged Property.
     (f) The acceptance by Lender of the assignments of the Leases and Rents
pursuant to this Section 3 shall not at any time or in any event obligate Lender
to take any action under any Loan Document or to expend any money or to incur
any expense. Except to the extent caused by the gross negligence or willful
misconduct of Lender, Lender shall not be liable in any way for any injury or
damage to person or property sustained by any Person in, on or about the
Mortgaged Property. Prior to Lender’s actual entry upon and taking possession
and control of the Land and Improvements, Lender shall not be:
     (1) obligated to perform any of the terms, covenants and conditions
contained in any Lease (or otherwise have any obligation with respect to any
Lease);

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     (2) obligated to appear in or defend any action or proceeding relating to
any Lease or the Mortgaged Property; or
     (3) responsible for the operation, control, care, management or repair of
the Mortgaged Property or any portion of the Mortgaged Property.
The execution of this Security Instrument shall constitute conclusive evidence
that all responsibility for the operation, control, care, management and repair
of the Mortgaged Property is and shall be that of Borrower, prior to such actual
entry and taking possession and control by Lender of the Land and Improvements.
     (g) Lender shall be liable to account only to Borrower and only for Rents
actually received by Lender. Except to the extent caused by the gross negligence
or willful misconduct of Lender, Lender shall not be liable to Borrower, anyone
claiming under or through Borrower or anyone having an interest in the Mortgaged
Property by reason of any act or omission of Lender under this Section 3, and
Borrower hereby releases and discharges Lender from any such liability to the
fullest extent permitted by law. If the Rents are not sufficient to meet the
costs of taking control of and managing the Mortgaged Property and collecting
the Rents, any funds expended by Lender for such purposes shall be added to, and
become a part of, the principal balance of the Indebtedness, be immediately due
and payable, and bear interest at the Default Rate from the date of disbursement
until fully paid. Any entering upon and taking control of the Mortgaged Property
by Lender or the receiver, and any application of Rents as provided in this
Security Instrument, shall not cure or waive any Event of Default or invalidate
any other right or remedy of Lender under applicable law or provided for in this
Security Instrument or any Loan Document.
4. Protection of Lender’s Security.
     If Borrower fails to perform any of its obligations under this Security
Instrument or any other Loan Document, or any action or proceeding is commenced
that purports to affect the Mortgaged Property, Lender’s security, rights or
interests under this Security Instrument or any Loan Document (including eminent
domain, insolvency, code enforcement, civil or criminal forfeiture, enforcement
of Environmental Laws, fraudulent conveyance or reorganizations or proceedings
involving a debtor or decedent), Lender may, at its option, make such
appearances, disburse or pay such sums and take such actions, whether before or
after an Event of Default or whether directly or to any receiver for the
Mortgaged Property, as Lender reasonably deems necessary to perform such
obligations of Borrower and to protect the Mortgaged Property or Lender’s
security, rights or interests in the Mortgaged Property or the Mortgage Loan,
including:
     (a) paying fees and out-of-pocket expenses of attorneys, accountants,
inspectors and consultants;

          Fannie Mae Multifamily Security Instrument
Kansas   Form 6025.KS
01-11   Page 10
© 2011 Fannie Mae

 

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     (b) entering upon the Mortgaged Property to make repairs or secure the
Mortgaged Property;
     (c) obtaining (or force-placing) the insurance required by the Loan
Documents; and
     (d) paying any amounts required under any of the Loan Documents that
Borrower has failed to pay.
Any amounts so disbursed or paid by Lender shall be added to, and become part
of, the principal balance of the Indebtedness, be immediately due and payable
and bear interest at the Default Rate from the date of disbursement until fully
paid. The provisions of this Section 4 shall not be deemed to obligate or
require Lender to incur any expense or take any action.
5. No Other Indebtedness and Mezzanine Financing.
     Other than the Mortgage Loan, Borrower shall not incur or be obligated at
any time with respect to any loan or other indebtedness in connection with or
secured by the Mortgaged Property. Neither Borrower nor any owner of Borrower
shall (a) incur any “mezzanine debt,” secured or unsecured, or issue any
preferred equity that is secured by a pledge of the ownership interests in
Borrower or by a pledge of the cash flows of Borrower to the extent the Transfer
of the underlying ownership interests is otherwise prohibited by the Loan
Agreement, or (b) incur any similar Indebtedness or equity with respect to the
Mortgaged Property or ownership interest in Borrower or any owner of Key
Principal or Guarantor that is secured by a pledge of the cash flows of Borrower
to the extent the Transfer of the underlying ownership interests is otherwise
prohibited by the Loan Agreement.
6. Default; Acceleration; Remedies.
     (a) From and after the occurrence of an Event of Default, Lender, at its
option, may declare the Indebtedness to be immediately due and payable without
further demand, and may either with or without entry or taking possession as
herein provided or otherwise, proceed by suit or suits at law or in equity or
any other appropriate proceeding or remedy (1) to enforce payment of the
Mortgage Loan; (2) to foreclose this Security Instrument judicially or
non-judicially; (3) to enforce or exercise any right under any Loan Document;
and (4) to pursue any one (1) or more other remedies provided in this Security
Instrument or in any other Loan Document or otherwise afforded by applicable
law. Each right and remedy provided in this Security Instrument or any other
Loan Document is distinct from all other rights or remedies under this Security
Instrument or any other Loan Document or otherwise afforded by applicable law,
and each shall be cumulative and may be exercised concurrently, independently,
or successively, in any order. Borrower has the right to bring an action to
assert the nonexistence of an Event of Default or any other defense of Borrower
to acceleration and sale.

          Fannie Mae Multifamily Security Instrument
Kansas   Form 6025.KS
01-11   Page 11
© 2011 Fannie Mae

 

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     (b) In connection with any sale made under or by virtue of this Security
Instrument, the whole of the Mortgaged Property may be sold in one (1) parcel as
an entirety or in separate lots or parcels at the same or different times, all
as Lender may determine in its sole discretion. Lender shall have the right to
become the purchaser at any such sale. In the event of any such sale, the
outstanding principal amount of the Mortgage Loan and the other Indebtedness, if
not previously due, shall be and become immediately due and payable without
demand or notice of any kind. If the Mortgaged Property is sold for an amount
less than the amount outstanding under the Indebtedness, the deficiency shall be
determined by the purchase price at the sale or sales. To the extent not
prohibited by applicable law, Borrower waives all rights, claims, and defenses
with respect to Lender’s ability to obtain a deficiency judgment.
     (c) Borrower acknowledges and agrees that the proceeds of any sale shall be
applied as determined by Lender unless otherwise required by applicable law.
     (d) In connection with the exercise of Lender’s rights and remedies under
this Security Instrument and any other Loan Document, there shall be allowed and
included as Indebtedness: (1) all expenditures and expenses authorized by
applicable law and all other expenditures and expenses which may be paid or
incurred by or on behalf of Lender for reasonable legal fees, appraisal fees,
outlays for documentary and expert evidence, stenographic charges and
publication costs; (2) all expenses of any environmental site assessments,
environmental audits, environmental remediation costs, appraisals, surveys,
engineering studies, wetlands delineations, flood plain studies, and any other
similar testing or investigation deemed necessary or advisable by Lender
incurred in preparation for, contemplation of or in connection with the exercise
of Lender’s rights and remedies under the Loan Documents; and (3) costs (which
may be reasonably estimated as to items to be expended in connection with the
exercise of Lender’s rights and remedies under the Loan Documents) of procuring
all abstracts of title, title searches and examinations, title insurance
policies, and similar data and assurance with respect to title as Lender may
deem reasonably necessary either to prosecute any suit or to evidence the true
conditions of the title to or the value of the Mortgaged Property to bidders at
any sale which may be held in connection with the exercise of Lender’s rights
and remedies under the Loan Documents. All expenditures and expenses of the
nature mentioned in this Section 6, and such other expenses and fees as may be
incurred in the protection of the Mortgaged Property and rents and income
therefrom and the maintenance of the lien of this Security Instrument, including
the fees of any attorney employed by Lender in any litigation or proceedings
affecting this Security Instrument, the Note, the other Loan Documents, or the
Mortgaged Property, including bankruptcy proceedings, any Foreclosure Event, or
in preparation of the commencement or defense of any proceedings or threatened
suit or proceeding, or otherwise in dealing specifically therewith, shall be so
much additional Indebtedness and shall be immediately due and payable by
Borrower, with interest thereon at the Default Rate until paid.
     (e) Any action taken by Lender pursuant to the provisions of this Section 6
shall comply with the laws of the Property Jurisdiction. Such applicable laws
shall take precedence over the provisions of this Section 6, but shall not
invalidate or render unenforceable any other

          Fannie Mae Multifamily Security Instrument
Kansas   Form 6025.KS
01-11   Page 12
© 2011 Fannie Mae

 

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provision of any Loan Document that can be construed in a manner consistent with
any applicable law. If any provision of this Security Instrument shall grant to
Lender (including Lender acting as a mortgagee-in-possession), or a receiver
appointed pursuant to the provisions of this Security Instrument any powers,
rights or remedies prior to, upon or following the occurrence of an Event of
Default that are more limited than the powers, rights, or remedies that would
otherwise be vested in such party under any applicable law in the absence of
said provision, such party shall be vested with the powers, rights, and remedies
granted in such applicable law to the full extent permitted by law.
7. Waiver of Statute of Limitations and Marshaling.
     Borrower hereby waives the right to assert any statute of limitations as a
bar to the enforcement of the lien of this Security Instrument or to any action
brought to enforce any Loan Document. Notwithstanding the existence of any other
security interests in the Mortgaged Property held by Lender or by any other
party, Lender shall have the right to determine the order in which any or all of
the Mortgaged Property shall be subjected to the remedies provided in this
Security Instrument and/or any other Loan Document or by applicable law. Lender
shall have the right to determine the order in which any or all portions of the
Indebtedness are satisfied from the proceeds realized upon the exercise of such
remedies. Borrower, for itself and all who may claim by, through or under it,
and any party who now or in the future acquires a security interest in the
Mortgaged Property and who has actual or constructive notice of this Security
Instrument, waives any and all right to require the marshaling of assets or to
require that any of the Mortgaged Property be sold in the inverse order of
alienation or that any of the Mortgaged Property be sold in parcels (at the same
time or different times) in connection with the exercise of any of the remedies
provided in this Security Instrument or any other Loan Document, or afforded by
applicable law.
8. Waiver of Redemption; Rights of Tenants.
     (a) Borrower hereby covenants and agrees that it will not at any time apply
for, insist upon, plead, avail itself, or in any manner claim or take any
advantage of, any appraisement, stay, exemption or extension law or any
so-called “Moratorium Law” now or at any time hereafter enacted or in force in
order to prevent or hinder the enforcement or foreclosure of this Security
Instrument. Without limiting the foregoing:
     (1) Borrower, for itself and all Persons who may claim by, through or under
Borrower, hereby expressly waives any so-called “Moratorium Law” and any and all
rights of reinstatement and redemption, if any, under any order or decree of
foreclosure of this Security Instrument, it being the intent hereof that any and
all such “Moratorium Laws”, and all rights of reinstatement and redemption of
Borrower and of all other Persons claiming by, through or under Borrower are and
shall be deemed to be hereby waived to the fullest extent permitted by the laws
of the Property Jurisdiction;

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Kansas   Form 6025.KS
01-11   Page 13
© 2011 Fannie Mae

 

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     (2) Borrower shall not invoke or utilize any such law or laws or otherwise
hinder, delay or impede the execution of any right, power remedy herein or
otherwise granted or delegated to Lender but will suffer and permit the
execution of every such right, power and remedy as though no such law or laws
had been made or enacted; and
     (3) if Borrower is a trust, Borrower represents that the provisions of this
Section 8 (including the waiver of reinstatement and redemption rights) were
made at the express direction of Borrower’s beneficiaries and the persons having
the power of direction over Borrower, and are made on behalf of the trust estate
of Borrower and all beneficiaries of Borrower, as well as all other persons
mentioned above.
     (b) Lender shall have the right to foreclose subject to the rights of any
tenant or tenants of the Mortgaged Property having an interest in the Mortgaged
Property prior to that of Lender. The failure to join any such tenant or tenants
of the Mortgaged Property as party defendant or defendants in any such civil
action or the failure of any decree of foreclosure and sale to foreclose their
rights shall not be asserted by Borrower as a defense in any civil action
instituted to collect the Indebtedness, or any part thereof or any deficiency
remaining unpaid after foreclosure and sale of the Mortgaged Property, any
statute or rule of law at any time existing to the contrary notwithstanding.
9. Notice.
     (a) All notices under this Security Instrument shall be:
     (1) in writing, and shall be (A) delivered, in person, (B) mailed, postage
prepaid, either by registered or certified delivery, return receipt requested,
or (C) sent by overnight express courier;
     (2) addressed to the intended recipient at its respective address set forth
at the end of this Security Instrument; and
     (3) deemed given on the earlier to occur of:
     (A) the date when the notice is received by the addressee; or
     (B) if the recipient refuses or rejects delivery, the date on which the
notice is so refused or rejected, as conclusively established by the records of
the United States Postal Service or such express courier service.
     (b) Any party to this Security Instrument may change the address to which
notices intended for it are to be directed by means of notice given to the other
party in accordance with this Section 9.

          Fannie Mae Multifamily Security Instrument
Kansas   Form 6025.KS
01-11   Page 14
© 2011 Fannie Mae

 

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     (c) Any required notice under this Security Instrument which does not
specify how notices are to be given shall be given in accordance with this
Section 9.
     (d) Lender shall endeavor to give Borrower’s counsel a courtesy copy of any
notice given to Borrower by Lender, at the address set forth below; provided,
however, failure to provide such courtesy copy notice shall not affect the
validity or sufficiency of any notice to Borrower, shall not affect Lender’s
rights and remedies hereunder or under any other Loan Documents, nor subject
Lender any claim by or liability to Borrower.
Garrett DeFrenza Stiepel LLP
Park Tower
695 Town Center Drive, Suite 500
Costa Mesa, California 92626-1924
Attn: Marc DeFrenza and Jim Mullen
10. Mortgagee-in-Possession.
     Borrower acknowledges and agrees that the exercise by Lender of any of the
rights conferred in this Security Instrument shall not be construed to make
Lender a mortgagee-in-possession of the Mortgaged Property so long as Lender has
not itself entered into actual possession of the Land and Improvements.
11. Release.
     Upon payment in full of the Indebtedness, Lender shall cause the release of
this Security Instrument and Borrower shall pay Lender’s costs incurred in
connection with such release.
12. Governing Law; Consent to Jurisdiction and Venue.
     This Security Instrument shall be governed by the laws of the Property
Jurisdiction without giving effect to any choice of law provisions thereof that
would result in the application of the laws of another jurisdiction. Borrower
agrees that any controversy arising under or in relation to this Security
Instrument shall be litigated exclusively in the Property Jurisdiction. The
state and federal courts and authorities with jurisdiction in the Property
Jurisdiction shall have exclusive jurisdiction over all controversies that arise
under or in relation to any security for the Indebtedness. Borrower irrevocably
consents to service, jurisdiction, and venue of such courts for any such
litigation and waives any other venue to which it might be entitled by virtue of
domicile, habitual residence or otherwise.
13. Miscellaneous Provisions.
     (a) This Security Instrument shall bind, and the rights granted by this
Security Instrument shall benefit, the successors and assigns of Lender. This
Security Instrument shall bind, and the obligations granted by this Security
Instrument shall inure to, any permitted

          Fannie Mae Multifamily Security Instrument
Kansas   Form 6025.KS
01-11   Page 15
© 2011 Fannie Mae

 

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successors and assigns of Borrower under the Loan Agreement. If more than one
(1) person or entity signs this Security Instrument as Borrower, the obligations
of such persons and entities shall be joint and several. The relationship
between Lender and Borrower shall be solely that of creditor and debtor,
respectively, and nothing contained in this Security Instrument shall create any
other relationship between Lender and Borrower. No creditor of any party to this
Security Instrument and no other person shall be a third party beneficiary of
this Security Instrument or any other Loan Document.
     (b) The invalidity or unenforceability of any provision of this Security
Instrument or any other Loan Document shall not affect the validity or
enforceability of any other provision of this Security Instrument or of any
other Loan Document, all of which shall remain in full force and effect. This
Security Instrument contains the complete and entire agreement among the parties
as to the matters covered, rights granted and the obligations assumed in this
Security Instrument. This Security Instrument may not be amended or modified
except by written agreement signed by the parties hereto.
     (c) The following rules of construction shall apply to this Security
Instrument:
     (1) The captions and headings of the sections of this Security Instrument
are for convenience only and shall be disregarded in construing this Security
Instrument.
     (2) Any reference in this Security Instrument to an “Exhibit” or “Schedule”
or a “Section” or an “Article” shall, unless otherwise explicitly provided, be
construed as referring, respectively, to an exhibit or schedule attached to this
Security Instrument or to a Section or Article of this Security Instrument.
     (3) Any reference in this Security Instrument to a statute or regulation
shall be construed as referring to that statute or regulation as amended from
time to time.
     (4) Use of the singular in this Security Instrument includes the plural and
use of the plural includes the singular.
     (5) As used in this Security Instrument, the term “including” means
“including, but not limited to” or “including, without limitation,” and is for
example only, and not a limitation.
     (6) Whenever Borrower’s knowledge is implicated in this Security Instrument
or the phrase “to Borrower’s knowledge” or a similar phrase is used in this
Security Instrument, Borrower’s knowledge or such phrase(s) shall be interpreted
to mean to the best of Borrower’s knowledge after reasonable and diligent
inquiry and investigation.
     (7) Unless otherwise provided in this Security Instrument, if Lender’s
approval is required for any matter hereunder, such approval may be granted or
withheld in Lender’s sole and absolute discretion.

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Kansas   Form 6025.KS
01-11   Page 16
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     (8) Unless otherwise provided in this Security Instrument, if Lender’s
designation, determination, selection, estimate, action or decision is required,
permitted or contemplated hereunder, such designation, determination, selection,
estimate, action or decision shall be made in Lender’s sole and absolute
discretion.
     (9) All references in this Security Instrument to a separate instrument or
agreement shall include such instrument or agreement as the same may be amended
or supplemented from time to time pursuant to the applicable provisions thereof.
     (10) “Lender may” shall mean at Lender’s discretion, but shall not be an
obligation.
14. Time is of the Essence.
     Borrower agrees that, with respect to each and every obligation and
covenant contained in this Security Instrument and the other Loan Documents,
time is of the essence.
15. WAIVER OF TRIAL BY JURY.
     TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, EACH OF BORROWER AND
LENDER (BY ITS ACCEPTANCE HEREOF) (A) COVENANTS AND AGREES NOT TO ELECT A TRIAL
BY JURY WITH RESPECT TO ANY ISSUE ARISING OUT OF THIS SECURITY INSTRUMENT OR THE
RELATIONSHIP BETWEEN THE PARTIES AS BORROWER AND LENDER THAT IS TRIABLE OF RIGHT
BY A JURY AND (B) WAIVES ANY RIGHT TO TRIAL BY JURY WITH RESPECT TO SUCH ISSUE
TO THE EXTENT THAT ANY SUCH RIGHT EXISTS NOW OR IN THE FUTURE. THIS WAIVER OF
RIGHT TO TRIAL BY JURY IS SEPARATELY GIVEN BY EACH OF BORROWER AND LENDER,
KNOWINGLY AND VOLUNTARILY WITH THE BENEFIT OF COMPETENT LEGAL COUNSEL.
16. Acknowledgment of Receipt.
     Borrower acknowledges receipt of a copy of this Security Instrument, the
Note and the other Loan Documents.

          Fannie Mae Multifamily Security Instrument
Kansas   Form 6025.KS
01-11   Page 17
© 2011 Fannie Mae

 

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     ATTACHED EXHIBITS. The following Exhibits are attached to this Security
Instrument and incorporated fully herein by reference:

         
 
  þ   Exhibit A Description of the Land (required)
 
       
 
  þ   Exhibit B Modifications to Security Instrument (Tax Credit Properties)

[Remainder of Page Intentionally Blank]

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     IN WITNESS WHEREOF, Borrower has signed and delivered this Security
Instrument under seal (where applicable) or has caused this Security Instrument
to be signed and delivered by its duly authorized representative under seal
(where applicable). Where applicable law so provides, Borrower intends that this
Security Instrument shall be deemed to be signed and delivered as a sealed
instrument.

            BORROWER:

SIR CLARION PARK, LLC,
a Delaware limited liability company
      By:   Steadfast Income Advisor, LLC,         a Delaware limited liability
company      Its:  Manager      By:   /s/ Ana Marie del Rio         Name:   Ana
Marie del Rio        Title:   Secretary     

The name, chief executive office and organizational identification number of
Borrower (as Debtor under any applicable Uniform Commercial Code) are:
Debtor Name/Record Owner: SIR CLARION PARK, LLC
Debtor Chief Executive Office Address:
18100 Von Karman Avenue, Suite 500
Irvine, Orange County, California 92612
Debtor Organizational ID Number: 4990276
The name and chief executive office of Lender (as Secured Party) are:
Secured Party Name: PNC BANK, NATIONAL ASSOCIATION
Secured Party Chief Executive Office Address:
26901 Agoura Rd., Suite 200
Calabasas Hills, California 91301

          Fannie Mae Multifamily Security Instrument   Form 6025.KS   Page S-1
Kansas   01-11   © 2011 Fannie Mae

 

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ACKNOWLEDGEMENT

             
STATE OF CALIFORNIA
    )      
 
    )     SS.
COUNTY OF ORANGE
    )      

     On June 28, 2011, before me, Mary L. Kelly, a Notary Public, personally
appeared Ana Marie del Rio, who proved to me on the basis of satisfactory
evidence to be the person whose name is subscribed to the within instrument and
acknowledged to me that she executed the same in her authorized capacity, and
that by her signature on the instrument the person, or the entity upon behalf of
which the person acted, executed the instrument.
     I certify under penalty of perjury under the laws of the State of
California that the foregoing paragraph is true and correct.
     WITNESS my hand and official seal.

                  /s/ Mary L. Kelly       Notary Public           

[Seal]

          Fannie Mae Multifamily Security Instrument   Form 6025.KS     Kansas  
01-11   © 2011 Fannie Mae

 

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EXHIBIT A
DESCRIPTION OF THE LAND
LOT 3, DELMAR GARDENS A SUBDIVISION IN THE CITY OF OLATHE, JOHNSON COUNTY,
KANSAS, EXCEPTING THEREFROM THE FOLLOWING:
ALL OF THAT PART OF LOT 3, DELMAR GARDENS, A SUBDIVISION OF LAND NOW IN THE CITY
OF OLATHE, JOHNSON COUNTY, KANSAS, MORE PARTICULARLY DESCRIBED AS FOLLOWS;
COMMENCING AT THE SOUTHEAST CORNER OF SAID LOT 3; THENCE SOUTH 89° 41’ WEST,
ALONG THE SOUTH LINE OF SAID LOT 3, A DISTANCE OF 280.78 FEET, TO THE TRUE POINT
OF BEGINNING OF SUBJECT TRACT; THENCE SOUTH 86° 49’ 15” WEST, ALONG THE SOUTH
LINE OF SAID LOT 3, A DISTANCE OF 200.25 FEET; THENCE SOUTH 89° 41’ WEST, ALONG
THE SOUTH LINE OF SAID OF LOT 3, A DISTANCE OF 500 FEET; THENCE NORTH 87° 27’
15” WEST, ALONG THE SOUTH LINE OF SAID LOT 3, A DISTANCE OF 200.25 FEET; THENCE
NORTH 89° 41’ EAST, A DISTANCE OF 900 FEET, TO THE TRUE POINT OF BEGINNING OF
SUBJECT TRACT,
AND EXCEPT ANY OTHER PART USED OR DEDICATED FOR STREETS, ROADS OR PUBLIC
RIGHTS-OF-WAY.
APN: DP16800000-0003

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EXHIBIT B
MODIFICATIONS TO SECURITY INSTRUMENT
(Tax Credit Properties)
     The foregoing Security Instrument is hereby modified as follows:
     1. Capitalized terms used and not specifically defined herein have the
meanings given to such terms in the Security Instrument.
     2. Section 1 of the Security Instrument (Defined Terms) is hereby amended
by adding the following new definitions in the appropriate alphabetical order:
“Extended Use Agreement” means any extended low income housing commitment (as
such term is defined in Section 42(h)(6)(B) of the Internal Revenue Code)
recorded against the Mortgaged Property.
     3. The following sections are hereby added to the Security Instrument as
Sections 17 and 18:
     17. Extended Low-Income Housing Commitment.
     Lender agrees that the lien of this Security Instrument shall be
subordinate to the Extended Use Agreement; provided that such Extended Use
Agreement, by its terms, must terminate upon a Foreclosure Event in accordance
with Section 42(h)(6)(E) of the Internal Revenue Code.
     18. Cross-Default.
     Borrower acknowledges and agrees that any default, event of default, or
breach (however such terms may be defined) after the expiration of any
applicable notice and/or cure periods under the Extended Use Agreement shall be
an Event of Default under this Security Instrument and the Loan Documents and
that any costs, damages or other amounts, including reasonable attorney’s fees
incurred by the Lender as a result of such an Event of Default by Borrower,
including amounts paid to cure any default or event of default, under the
Extended Use Agreement shall be an obligation of Borrower and become a part of
the Indebtedness secured by this Security Instrument and the Loan Agreement.

            ADR       Borrower Initials                        

          Fannie Mae Multifamily Security Instrument   Form 6025.KS   Page A-2
Kansas   01-11   © 2011 Fannie Mae