Exhibit 10.4

Prepared by, and after recording

return to:

James J. Schwert, Esquire

Oppenheimer Wolff & Donnelly LLP

Campbell Mithun Tower – Suite 2000

222 South Ninth Street

Minneapolis, MN 55402-3338

MULTIFAMILY TRUST INDENTURE,

ASSIGNMENT OF LEASES AND RENTS,

SECURITY AGREEMENT

AND FIXTURE FILING

(MONTANA)

 

CHT BILLINGS MT SENIOR LIVING, LLC, as Grantor

 

KEYCORP REAL ESTATE CAPITAL MARKETS, INC., as Beneficiary

 

CHICAGO TITLE OF MONTANA, LLC, as Trustee

 

Fannie Mae Multifamily Security Instrument   Form 6025.MT   Montana   01-11   ©
2011 Fannie Mae

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TABLE OF CONTENTS

 

         PAGE  

1.

  DEFINED TERMS.      2   

2.

  SECURITY AGREEMENT; FIXTURE FILING.      7   

3.

  ASSIGNMENT OF LEASES AND RENTS; APPOINTMENT OF RECEIVER; LENDER IN POSSESSION.
     8   

4.

  PROTECTION OF BENEFICIARY’S SECURITY.      11   

5.

  NO OTHER INDEBTEDNESS AND MEZZANINE FINANCING.      11   

6.

  DEFAULT; ACCELERATION; REMEDIES.      12   

7.

  WAIVER OF STATUTE OF LIMITATIONS AND MARSHALING.      14   

8.

  WAIVER OF RIGHTS; RIGHTS OF TENANTS.      14   

9.

  NOTICE.      15   

10.

  MORTGAGEE-IN-POSSESSION.      15   

11.

  RELEASE.      15   

12.

  SUBSTITUTE TRUSTEE.      16   

13.

  MONTANA STATE SPECIFIC PROVISIONS.      16   

14.

  GOVERNING LAW; CONSENT TO JURISDICTION AND VENUE.      16   

15.

  MISCELLANEOUS PROVISIONS.      16   

16.

  TIME IS OF THE ESSENCE.      18   

17.

  WAIVER OF TRIAL BY JURY.      18   

 

Fannie Mae Multifamily Security Instrument    Form 6025.MT    Page i Montana   
01-11    © 2011 Fannie Mae

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MULTIFAMILY TRUST INDENTURE,

ASSIGNMENT OF LEASES AND RENTS,

SECURITY AGREEMENT

AND FIXTURE FILING

This MULTIFAMILY TRUST INDENTURE, 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
August 31, 2012, is executed by CHT BILLINGS MT SENIOR LIVING, LLC, a limited
liability company, organized and existing under the laws of Delaware, as grantor
(“Grantor”), to CHICAGO TITLE OF MONTANA, LLC, a Montana limited liability
company, as trustee (“Trustee”), for the benefit of KEYCORP REAL ESTATE CAPITAL
MARKETS, INC., a corporation, organized and existing under the laws of Ohio, as
beneficiary (“Beneficiary”).

Grantor, in consideration of (i) the loan in the original principal amount of
Eleven Million Thirty-One Thousand and No/100 Dollars ($11,031,000.00) (the
“Mortgage Loan”) evidenced by that certain Multifamily Note dated as of the date
of this Security Instrument, executed by Grantor and made payable to the order
of Beneficiary maturing on September 1, 2022 (as amended, restated, replaced,
supplemented, or otherwise modified from time to time, the “Note”), (ii) that
certain Multifamily Loan and Security Agreement dated as of the date of this
Security Instrument, executed by and between Grantor and Beneficiary (as
amended, restated, replaced, supplemented or otherwise modified from time to
time, the “Loan Agreement”), and (iii) the trust created by this Security
Instrument, and to secure to Beneficiary 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
Grantor 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, warrants,
conveys, bargains, sells, and assigns to Trustee, in trust, for benefit of
Beneficiary, with power of sale and right of entry and possession, the Mortgaged
Property (as defined in this Security Instrument), including the real property
located in Yellowstone County, State of Montana, 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 Trustee and Trustee’s
successors and assigns, forever; Grantor 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. This Security
Instrument is and shall be construed to be, among other things, a trust
indenture under the Small Tract Financing Act of Montana, Title 71, Chapter 1,
Part 3, Montana Code Annotated.

Grantor represents and warrants that Grantor is lawfully seized of the Mortgaged
Property and has the right, power and authority to mortgage, grant, warrant,
convey, bargain, sell, and assign 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). Grantor covenants that Grantor will warrant and defend the title to
the Mortgaged Property against all claims and demands other than Permitted
Encumbrances.

 

Fannie Mae Multifamily Security Instrument   Form 6025.MT   Page 1 Montana  
01-11   © 2011 Fannie Mae

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Notwithstanding anything to the contrary herein, this Security Instrument
secures all future advances now contemplated and made pursuant to and/or in
connection with the Loan Agreement and the other Loan Documents, even though a
portion thereof may not yet be advanced. Any such future advances are so secured
hereby as if made on the date hereof; provided, however, that nothing in this
Security Instrument shall constitute a commitment or obligation to make such
future advances, the terms of which are governed solely by the applicable Loan
Documents. The total indebtedness, including future advances, that may be
outstanding at any given time and be subject to this Security Instrument and
secured hereby is the sum of $11,031,000.00.

Grantor, and by their acceptance hereof, each of Trustee and Beneficiary
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 Beneficiary 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 Grantor
to and for the benefit of Beneficiary, 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.

 

Fannie Mae Multifamily Security Instrument   Form 6025.MT   Page 2 Montana  
01-11   © 2011 Fannie Mae

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“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; 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
Beneficiary 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 Beneficiary may require under
the Loan Agreement;

(c) Taxes; and

(d) amounts for other charges and expenses which Beneficiary 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
Beneficiary’s interests, all as reasonably determined from time to time by
Beneficiary.

“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.

 

Fannie Mae Multifamily Security Instrument   Form 6025.MT   Page 3 Montana  
01-11   © 2011 Fannie Mae

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“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 Grantor or to protect
the Mortgaged Property or the security of this Security Instrument, all other
monetary obligations of Grantor 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.

“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
Grantor 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 Grantor’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 Grantor obtained the insurance pursuant to Beneficiary’s
requirements;

 

Fannie Mae Multifamily Security Instrument   Form 6025.MT   Page 4 Montana  
01-11   © 2011 Fannie Mae

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(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 Grantor now or in the future, including cash or securities
deposited to secure performance by parties of their obligations;

(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 Grantor 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;

(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.

 

Fannie Mae Multifamily Security Instrument   Form 6025.MT   Page 5 Montana  
01-11   © 2011 Fannie Mae

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“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.

“Permitted Equipment Financing” means, with respect to the Mortgaged Property,
equipment lease or other purchase money financing incurred in the ordinary
course of business for acquisition of additional or replacement equipment or
other personal property or to refinance Permitted Equipment Financing, in an
amount not to exceed two percent (2%) of the Loan Amount, less normal
outstanding account payable balances.

“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
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.

 

Fannie Mae Multifamily Security Instrument   Form 6025.MT   Page 6 Montana  
01-11   © 2011 Fannie Mae

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“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 Beneficiary, the repayment of the Indebtedness, and all
renewals, extensions and modifications thereof, and the performance of the
covenants and agreements of Grantor contained in the Loan Documents, Grantor
hereby pledges, assigns, and grants to Beneficiary 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. A description of the real property to which the collateral is related
is shown on the attached Exhibit A. Grantor hereby authorizes Beneficiary or
Trustee to file financing statements, continuation statements and financing
statement amendments in such form as Beneficiary may require to perfect or
continue the perfection of this security interest without the signature of
Grantor. From and after the occurrence of an Event of Default, Beneficiary 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. Beneficiary
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 Beneficiary’s other remedies. For purposes of the UCC, the debtor is
Grantor and the secured party is Beneficiary. The name and address of the debtor
and secured party are set forth after Grantor’s signature below which are the
addresses from which information on the security interest may be obtained.

(b) Grantor represents and warrants that: (1) Grantor maintains its chief
executive office at the location set forth after Grantor’s signature below, and
Grantor will notify Beneficiary in writing of any change in its chief executive
office within five (5) days of such change; (2) Grantor is the record owner of
the Mortgaged Property; (3) Grantor’s state of incorporation, organization, or
formation, if applicable, is as set forth on Page 1 of this Security Instrument;
(4) Grantor’s exact legal name is as set forth on Page 1 of this Security
Instrument; (5) Grantor’s organizational identification number, if applicable,
is as set forth after Grantor’s signature below; (6) Grantor is the owner of the
UCC Collateral subject to no liens, charges or encumbrances other than the lien
hereof and Permitted Equipment Financing; (7) the UCC Collateral will not be
removed from the Mortgaged Property without the consent of Beneficiary, except
for replacement in the ordinary course of business; 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.

 

Fannie Mae Multifamily Security Instrument   Form 6025.MT   Page 7 Montana  
01-11   © 2011 Fannie Mae

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(c) All property of every kind acquired by Grantor 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 Grantor and without further conveyance or
assignment become subject to the lien and security interest created by this
Security Instrument. Nevertheless, Grantor 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 Beneficiary 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, Grantor absolutely and
unconditionally assigns and transfers to Beneficiary all Leases and Rents. It is
the intention of Grantor to establish present, absolute and irrevocable
transfers and assignments to Beneficiary of all Leases and Rents and to
authorize and empower Beneficiary to collect and receive all Rents without the
necessity of further action on the part of Grantor. Grantor and Beneficiary
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 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 the Grantor, in such circumstance, that this Security
Instrument create and perfect a lien on each of the Leases and Rents in favor of
Beneficiary, 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, Grantor shall have a revocable license to
exercise all rights, power and authority granted to Grantor 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 Beneficiary, 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 Grantor free and clear of, and
released from, Beneficiary’s rights with respect to Rents under this Security
Instrument.

(c) From and after the occurrence of an Event of Default, without the necessity
of Beneficiary 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
Grantor pursuant to Section 3(b) shall automatically terminate, and Beneficiary
shall immediately have all rights, powers and authority granted to Grantor 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,
Beneficiary 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, Grantor authorizes Beneficiary to collect, sue for and compromise
Rents and directs each tenant of the Mortgaged Property to pay all Rents to, or
as directed by, Beneficiary, and Grantor shall, upon Grantor’s receipt of any
Rents from any sources, pay the total amount of such receipts to Beneficiary.
Although the foregoing rights of Beneficiary are self-effecting, at any time
from and after the occurrence of an Event of Default, Beneficiary may make
demand for all Rents, and Beneficiary may give, and Grantor hereby irrevocably
authorizes Beneficiary to give, notice to all tenants of the Mortgaged Property
instructing them to pay all Rents to Beneficiary. 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 Grantor any amounts that are actually
paid to Beneficiary in response to such a notice. Any such notice by Beneficiary
shall be delivered to each tenant personally, by mail or by delivering such
demand to each rental unit.

 

Fannie Mae Multifamily Security Instrument   Form 6025.MT   Page 8 Montana  
01-11   © 2011 Fannie Mae

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(d) From and after the occurrence of an Event of Default, Beneficiary may,
regardless of the adequacy of Beneficiary’s security or the solvency of Grantor,
and even in the absence of waste, enter upon, take and maintain full control of
the Mortgaged Property, and may exclude Grantor and its agents and employees
therefrom, in order to perform all acts that Beneficiary, 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
Beneficiary’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
Beneficiary in its discretion may deem necessary or desirable.

(e) Notwithstanding any other right provided Beneficiary under this Security
Instrument or any other Loan Document, if an Event of Default has occurred, and
regardless of the adequacy of Beneficiary’s security or Grantor’s solvency, and
without the necessity of giving prior notice (oral or written) to Grantor,
Beneficiary 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 Beneficiary elects to seek the appointment of a receiver for
the Mortgaged Property at any time after an Event of Default has occurred,
Grantor, 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. Grantor consents to shortened time consideration
of a motion to appoint a receiver. Beneficiary 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 Beneficiary’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 Beneficiary or the receiver, as applicable. If Beneficiary takes
possession and control of the Mortgaged Property, Beneficiary may exclude
Grantor and its representatives from the Mortgaged Property.

 

Fannie Mae Multifamily Security Instrument   Form 6025.MT   Page 9 Montana  
01-11   © 2011 Fannie Mae

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(f) The acceptance by Beneficiary of the assignments of the Leases and Rents
pursuant to this Section 3 shall not at any time or in any event obligate
Beneficiary to take any action under any Loan Document or to expend any money or
to incur any expense. Beneficiary 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 Beneficiary’s actual entry upon and taking
possession and control of the Land and Improvements, Beneficiary 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);

(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 Grantor, prior to such actual
entry and taking possession and control by Beneficiary of the Land and
Improvements.

(g) Beneficiary shall be liable to account only to Grantor and only for Rents
actually received by Beneficiary. Beneficiary shall not be liable to Grantor,
anyone claiming under or through Grantor or anyone having an interest in the
Mortgaged Property by reason of any act or omission of Beneficiary under this
Section 3, and Grantor hereby releases and discharges Beneficiary 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 Beneficiary 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 Beneficiary 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
Beneficiary under applicable law or provided for in this Security Instrument or
any Loan Document.

 

Fannie Mae Multifamily Security Instrument   Form 6025.MT   Page 10 Montana  
01-11   © 2011 Fannie Mae

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4. Protection of Beneficiary’s Security.

If Grantor 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, Beneficiary’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), Beneficiary 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 Beneficiary reasonably deems necessary to perform
such obligations of Grantor and to protect the Mortgaged Property or
Beneficiary’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;

(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 Grantor has
failed to pay.

Any amounts so disbursed or paid by Beneficiary 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 Beneficiary to incur any expense or take any action.

 

5. No Other Indebtedness and Mezzanine Financing.

Other than the Mortgage Loan and Permitted Equipment Financing, Grantor 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
Grantor nor any owner of Grantor 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 Grantor or by a pledge of the cash flows of Grantor 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 Grantor
or any owner of Key Principal or Guarantor that is secured by a pledge of the
cash flows of Grantor to the extent the Transfer of the underlying ownership
interests is otherwise prohibited by the Loan Agreement.

 

Fannie Mae Multifamily Security Instrument   Form 6025.MT   Page 11 Montana  
01-11   © 2011 Fannie Mae

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6. Default; Acceleration; Remedies.

(a) From and after the occurrence of an Event of Default, Beneficiary, 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 by advertisement and the power of sale granted herein; (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. Grantor has the right to bring an action to assert the nonexistence
of an Event of Default or any other defense of Grantor to acceleration and sale.

(b) Grantor acknowledges that the right to foreclose by advertisement and sale
granted in this Security Instrument may be exercised or directed by Beneficiary
without prior judicial hearing. In the event Beneficiary invokes the power of
sale:

(1) Beneficiary or Trustee shall record a notice of sale in each county in which
the Mortgaged Property is located, and Trustee shall mail copies of such notice
to Grantor and to such other persons as the laws of Montana prescribe. After
posting on the Mortgaged Property and publishing of such notice, Trustee shall
sell the Mortgaged Property according to the laws of Montana;

(2) Trustee shall have the authority to determine the terms of the sale. In
connection with any such sale, 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. Beneficiary shall have the right to become the purchaser at any
such sale. Trustee shall be entitled to receive fees and expenses from such sale
not to exceed the amount permitted by applicable law;

(3) within a reasonable time after the sale, Trustee shall deliver to the
purchaser of the Mortgaged Property a deed or such other appropriate conveyance
document conveying the Mortgaged Property so sold without any express or implied
covenant or warranty. The recitals in such deed or document shall be prima facie
evidence of the truth of the statements made in those recitals; and

(4) 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.
Grantor waives all rights, claims, and defenses with respect to Beneficiary’s
ability to obtain a deficiency judgment.

 

Fannie Mae Multifamily Security Instrument   Form 6025.MT   Page 12 Montana  
01-11   © 2011 Fannie Mae

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(c) Grantor acknowledges and agrees that the proceeds of any sale shall be
applied as determined by Beneficiary unless otherwise required by applicable
law.

(d) In connection with the exercise of Beneficiary’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 Beneficiary 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 Beneficiary
incurred in preparation for, contemplation of or in connection with the exercise
of Beneficiary’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 Beneficiary’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
Beneficiary 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 Beneficiary’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 Beneficiary
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 Grantor, with interest thereon at the
Default Rate until paid.

(e) Any action taken by Trustee or Beneficiary 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 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 Beneficiary
(including Beneficiary acting as a mortgagee-in-possession), Trustee 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.

 

Fannie Mae Multifamily Security Instrument   Form 6025.MT   Page 13 Montana  
01-11   © 2011 Fannie Mae

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7. Waiver of Statute of Limitations and Marshaling.

Grantor 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 Beneficiary or by any other
party, Beneficiary 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.
Beneficiary 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. Grantor, 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 Rights; Rights of Tenants.

(a) Grantor 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) Grantor for itself and all Persons who may claim by, through, or under
Grantor, hereby expressly waives any so-called “Moratorium Law,” it being the
intent hereof that any and all such “Moratorium Laws” are and shall be deemed to
be hereby waived to the fullest extent permitted by applicable law;

(2) Grantor 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 Beneficiary 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 Grantor is a trust, Grantor represents that the provisions of this
Section 8 were made at the express direction of Grantor’s beneficiaries and the
persons having the power of direction over Grantor, and are made on behalf of
the trust estate of Grantor and all beneficiaries of Grantor, as well as all
other persons mentioned above.

(b) Beneficiary 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 Beneficiary. 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 Grantor 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.

 

Fannie Mae Multifamily Security Instrument   Form 6025.MT   Page 14 Montana  
01-11   © 2011 Fannie Mae

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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.

(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.

 

10. Mortgagee-in-Possession.

Grantor acknowledges and agrees that the exercise by Beneficiary of any of the
rights conferred in this Security Instrument shall not be construed to make
Beneficiary a mortgagee-in-possession of the Mortgaged Property so long as
Beneficiary has not itself entered into actual possession of the Land and
Improvements.

 

11. Release.

Upon payment in full of the Indebtedness, Beneficiary shall cause the release of
this Security Instrument and Grantor shall pay Beneficiary’s costs incurred in
connection with such release.

 

Fannie Mae Multifamily Security Instrument   Form 6025.MT   Page 15 Montana  
01-11   © 2011 Fannie Mae

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12. Substitute Trustee.

Beneficiary, at Beneficiary’s option, may from time to time remove Trustee and
appoint a successor trustee in accordance with the laws of the Property
Jurisdiction. Without conveyance of the Mortgaged Property, the successor
trustee shall succeed to all the title, power and duties conferred upon Trustee
in this Security Instrument and by applicable law.

 

13. Montana State Specific Provisions.

(a) The area of the Mortgaged Property is not more than forty (40) acres.

(b) This Security Instrument shall not be deemed or interpreted to be a
“purchase money mortgage” under Montana Code Annotated, Section 71-1-232.

(c) Notwithstanding any provision to the contrary herein or in the other Loan
Documents, no sums payable under the Environmental Indemnity Agreement shall be
deemed to be secured by this Security Instrument.

 

14. 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. Grantor
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. Grantor 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.

 

15. Miscellaneous Provisions.

(a) This Security Instrument shall bind, and the rights granted by this Security
Instrument shall benefit, the successors and assigns of Beneficiary. This
Security Instrument shall bind, and the obligations granted by this Security
Instrument shall inure to, any permitted successors and assigns of Grantor under
the Loan Agreement. If more than one (1) person or entity signs this Security
Instrument as Grantor, the obligations of such persons and entities shall be
joint and several. The relationship between Beneficiary and Grantor shall be
solely that of creditor and debtor, respectively, and nothing contained in this
Security Instrument shall create any other relationship between Beneficiary and
Grantor. 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.

 

Fannie Mae Multifamily Security Instrument   Form 6025.MT   Page 16 Montana  
01-11   © 2011 Fannie Mae

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(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 Beneficiary.

(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 Grantor’s knowledge is implicated in this Security Instrument or
the phrase “to Grantor’s knowledge” or a similar phrase is used in this Security
Instrument, Grantor’s knowledge or such phrase(s) shall be interpreted to mean
to the best of Grantor’s knowledge after reasonable and diligent inquiry and
investigation.

(7) Unless otherwise provided in this Security Instrument, if Beneficiary’s
approval is required for any matter hereunder, such approval may be granted or
withheld in Beneficiary’s sole and absolute discretion.

(8) Unless otherwise provided in this Security Instrument, if Beneficiary’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 Beneficiary’s sole and absolute
discretion.

 

Fannie Mae Multifamily Security Instrument   Form 6025.MT   Page 17 Montana  
01-11   © 2011 Fannie Mae

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(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) “Beneficiary may” shall mean at Beneficiary’s discretion, but shall not be
an obligation.

 

16. Time is of the Essence.

Grantor 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.

 

17. WAIVER OF TRIAL BY JURY.

TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, EACH OF GRANTOR AND
BENEFICIARY (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 GRANTOR AND BENEFICIARY 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
GRANTOR AND BENEFICIARY, KNOWINGLY AND VOLUNTARILY WITH THE BENEFIT OF COMPETENT
LEGAL COUNSEL.

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

 

x    Exhibit A    Description of the Land (required) x    Exhibit B   
Modifications to Security Instrument (Seniors Housing x    Exhibit C   
Modifications to Security Instrument (Cross-Default and Cross-Collateralization:
Multi-Note) x    Exhibit D    Borrower Projects

[Remainder of Page Intentionally Blank]

 

Fannie Mae Multifamily Security Instrument   Form 6025.MT   Page 18 Montana  
01-11   © 2011 Fannie Mae

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IN WITNESS WHEREOF, Grantor 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, Grantor intends that this
Security Instrument shall be deemed to be signed and delivered as a sealed
instrument.

 

GRANTOR: CHT BILLINGS MT SENIOR LIVING, LLC, a Delaware limited liability
company By:  

/s/ Joshua J. Taube

Name:   Joshua J. Taube Title:   Vice President The name, chief executive office
and organizational identification number of Grantor (as Debtor under any
applicable Uniform Commercial Code) are: Debtor Name/Record Owner: CHT Billings
MT Senior Living, LLC Debtor Chief Executive Office Address: c/o Healthcare
Trust, Inc. CNL Center at City Commons 450 South Orange Avenue, Suite 1200
Orlando, Florida 32801 Debtor Organizational ID Number: 5092163 The name and
chief executive office of Beneficiary (as Secured Party) are: Secured Party
Name: KeyCorp Real Estate Capital Markets, Inc. Secured Party Chief Executive
Office Address: 11501 Outlook Street, Suite #300 Overland Park, Kansas 66211
Mailcode: KS-01-11-0501 Chicago Title of Montana, LLC 1575 Shiloh Road, Suite J
Billings, Montana 59106

 

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

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STATE OF      FL             

COUNTY OF      Orange             

This instrument was acknowledged before me on August 24, 2012, by Joshua J.
Taube, Vice President of CHT BILLINGS MT SENIOR LIVING, LLC, a Delaware limited
liability company.

 

/s/ Cathleen A. Coffey

Notary Public

 

Printed Name:  

Cathleen A. Coffey

 

My Commission Expires:

9/24/13

 

Fannie Mae Multifamily Security Instrument   Form 6025.MT   Page S-2 Montana  
01-11   © 2011 Fannie Mae

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EXHIBIT A

DESCRIPTION OF THE LAND

Lot 4, of Summer Ridge Subdivision, in the City of Billings, Yellowstone County,
Montana, according to the official plat on file in the office of the Clerk and
Recorder of said County, under Document No. 3283451.

 

Fannie Mae Multifamily Security Instrument   Form 6025.MT   Page A-1 Montana  
01-11   © 2011 Fannie Mae

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EXHIBIT B

MODIFICATIONS TO SECURITY INSTRUMENT

(Seniors Housing)

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 definition:

“Accounts” means all money, funds, investment property, accounts, general
intangibles, deposit accounts, chattel paper, documents, instruments, judgments,
claims, settlements of claims, causes of action, refunds, rebates,
reimbursements, reserves, deposits, subsidies, proceeds, products, rents and
profits, now or hereafter arising, received or receivable, from or on account of
Borrower’s management and operation of the Mortgaged Property as a Seniors
Housing Facility.

3. Section 1 of the Security Instrument (Defined Terms) is hereby amended by
deleting and restating in their entirety the definitions of “Goods,” “Leases,”
“Mortgaged Property,” “Personalty” and “Rents” to read as follows:

“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; 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); all kitchen or
restaurant supplies and facilities; dining room supplies and facilities; medical
supplies and facilities; leasehold improvements or related furniture and
equipment; including all present and future parts, additions, accessories,
replacements, attachments, accessions, replacement parts and substitutions of
the foregoing, and the proceeds thereof (cash and non-cash, including insurance
proceeds) and any other equipment, supplies or furniture owned by Borrower and
leased to any third party service provider or any operator or manager of the
Land or the Improvements; 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.

 

Modifications to Security Instrument (Seniors Housing)   Form 6310.SRS   Page 2
Fannie Mae   04-11   © 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), any residency, occupancy,
admission and care agreements pertaining to residents of the Mortgaged Property
and any Seniors Housing Facility Lease, and all modifications, extensions or
renewals thereof.

“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;

 

Modifications to Security Instrument (Seniors Housing)   Form 6310.SRS   Page 3
Fannie Mae   04-11   © 2011 Fannie Mae

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(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;

(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) resident and tenant security deposits, entrance fees, application fees,
processing fees, community fees and any other amounts or fees deposited by any
resident or tenant upon execution of a Lease which have not been forfeited by
the resident or tenant;

(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;

(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;

(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;

 

Modifications to Security Instrument (Seniors Housing)   Form 6310.SRS   Page 4
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(q) all payments due, or received, from residents, second party charges added to
base rental income, base or additional meal sales, commercial operations located
on the Mortgaged Property or provided as a service to the residents of the
Mortgaged Property, rental from guest suites, seasonal lease charges, furniture
leases, and laundry services, and any and all other services provided to
residents in connection with the Mortgaged Property, and any and all other
personal property on the Mortgaged Property, excluding personal property owned
by residents of the Mortgaged Property (other than Personalty owned by
Borrower);

(r) subject to applicable law and regulations, all Licenses and Contracts
relating to the operation and authority to operate the Mortgaged Property as a
Seniors Housing Facility;

(s) all Third Party Payments arising from the operation of the Mortgaged
Property as a Seniors Housing Facility;

(t) all of Borrower’s Accounts and Contracts; and

(u) all Facility Operating Agreements.

“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
operation of, or used in connection with, the Land or the Improvements,
including all governmental permits relating to any activities on the Land, all
personal property currently owned or hereafter acquired by Borrower used in
connection with the ownership and operation of the Mortgaged Property as a
Seniors Housing Facility, all kitchen or restaurant supplies and facilities,
dining room supplies and facilities, medical supplies and facilities, leasehold
improvements, or related furniture and equipment, together with all present and
future parts, additions, accessories, replacements, attachments, accessions,
replacement parts and substitutions therefor, and the proceeds thereof (cash and
non-cash including insurance proceeds) and any other equipment, supplies or
furniture owned by Borrower and leased to any third party service provider or
any Property Operator, including replacements and additions to any of the
foregoing.

“Rents” means all rents (whether from residential or non-residential space),
revenues and other income from the Land or the Improvements, including rent paid
under any Facility Operating Agreement, 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, entrance fees (if any), application fees,
processing fees, community fees and any other amounts or fees forfeited by any
resident or tenant, together with and including all proceeds from any private
insurance for residents to cover rental charges and charges for services at or
in connection with the Mortgaged Property, and the right to Third Party Payments
(other than Medicaid payments from governmental entities) due for the rents or
services of residents at the Mortgaged Property.

 

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Fannie Mae   04-11   © 2011 Fannie Mae

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4. Section 3(c) (Assignment of Leases and Rents; Appointment of Receiver; Lender
in Possession) of the Security Instrument is hereby amended by adding the
following to the end thereof:

After the occurrence of an Event of Default, at Lender’s option, Lender is
further authorized to give notice to all Third Party Payment payors (other than
Medicaid payments from governmental entities), instructing them to pay all Third
Party Payments to Lender which would be otherwise paid to Borrower, to the
extent permitted by law. In the case of Third Party Payments for Medicaid,
Lender and Borrower have executed a depositary agreement dated as of the
Effective Date which establishes special procedures for the receipt and
disposition of the Third Party Payments.

5. A new subsection 4(e) is hereby added to Section 4 (Protection of Lender’s
Security) of the Security Instrument as follows:

(e) paying for any required licensing fees, permits, or other expenses related
to the operation of the Mortgaged Property as a Seniors Housing Facility by or
on behalf of Lender, any fines or penalties that may be assessed against the
Mortgaged Property, paying any costs incurred to bring the Mortgaged Property
into full compliance with applicable codes and regulatory requirements, and
paying any fees or costs related to Lender’s employment of any Property Operator
or service provider for the Mortgaged Property.

6. A new Section 18 is hereby added to the Security Instrument as follows:

 

  18. Subordination of Seniors Housing Facility Lease.

Any Seniors Housing Facility Lease is and shall be subject and subordinate in
all respects to the liens, terms, covenants and conditions of this Security
Instrument and the other Loan Documents, and to all renewals, modifications,
consolidations, replacements and extensions thereof, and to all advances
heretofore made or which may hereafter be made pursuant to this Security
Instrument (including all sums advanced for the purposes of (a) protecting or
further securing the lien of this Security Instrument, curing defaults by
Borrower under the Loan Documents or for any other purposes expressly permitted
by this Security Instrument or (b) constructing, renovating, repairing,
furnishing, fixturing or equipping the Mortgaged Property).

 

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Fannie Mae   04-11   © 2011 Fannie Mae

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Initial Page to Exhibit B Modifications to Security Instrument (Seniors Housing)

 

/s/ JJT

Borrower Initials

 

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Fannie Mae   04-11   © 2011 Fannie Mae

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EXHIBIT C

MODIFICATIONS TO SECURITY INSTRUMENT

(Cross-Default and Cross-Collateralization: Multi-Note)

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:

“Borrower Projects” means all of the properties owned by Borrower or Borrower
affiliate described on Exhibit D, attached hereto, together with the Mortgaged
Property.

“Other Loan” means, individually and collectively, each additional loan extended
from Lender to Borrower or Borrower affiliate.

“Other Loan Documents” means the Other Security Instrument and any other loan
documents, including any Multifamily Loan and Security Agreement evidencing any
Other Loan.

“Other Security Instrument” means, individually and collectively, each
multifamily mortgage, deed of trust or deed to secure debt encumbering each of
the Borrower Projects (other than the Mortgaged Property) securing each Other
Loan.

3. The following section is hereby added to the Security Instrument as
Section 19 (Cross-Default and Cross-Collateralization):

 

  19. Cross-Default and Cross-Collateralization.

 

  (a) Cross-Collateralization.

Borrower hereby agrees and consents that the Mortgage Loan is and shall be
collateralized and secured by each of the Borrower Projects. Borrower has
executed this Security Instrument and the Other Security Instrument and consents
to the recording of this Security Instrument and the Other Security Instruments
against the Borrower Projects. The Mortgaged Property (as defined in each Other
Security Instrument) for each of the Borrower Projects shall be considered part
of the “Mortgaged Property” under this Security Instrument, and shall be
collateral under this Security Instrument and the Loan Documents.

 

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Multi-Note)   Form 6305   Page 1 Fannie Mae   01-11   © 2011 Fannie Mae

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  (b) Cross-Default.

Borrower hereby agrees and consents that upon the occurrence of an Event of
Default under this Security Instrument, any Other Loan Document, any other Other
Loan Document, or the Other Security Instrument, Lender shall have the right, in
its sole and absolute discretion, to exercise and perfect any and all rights in
and under any of the Loan Documents or Other Loan Documents (including, without
limitation, under this Security Instrument and/or any Other Security Instrument)
with regard to any or all of the Borrower Projects, including, but not limited
to, an acceleration of one (1) or all of the Notes and the sale of one (1) or
more (or all) of the Borrower Projects in accordance with the terms of the Loan
Agreement, this Security Instrument or any Other Security Instrument. No notice
shall be required to be given to Borrower in connection with such Event of
Default. No notice, except as may be expressly required by the Loan Documents,
shall be required to be given to Borrower in connection with Lender’s exercise
of any and all of its rights after an Event of Default has occurred.

 

  (c) Borrower Projects.

Exhibit D is hereby attached to and made part of this Security Instrument.

 

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Multi-Note)   Form 6305   Page 2 Fannie Mae   01-11   © 2011 Fannie Mae

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Initial Page to Exhibit C Modifications to Security Instrument (Cross-Default
and Cross-Collateralization: Multi-Note)

 

/s/ JJT

Borrower Initials

 

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Multi-Note)   Form 6305   Page 3 Fannie Mae   01-11   © 2011 Fannie Mae

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EXHIBIT D

TO

MODIFICATIONS TO SECURITY INSTRUMENT

(Cross-Default and Cross-Collateralization: Multi-Note)

Borrower Projects

 

Project

  

Property Address

   Loan Amount     

Property Owner (Borrower or Borrower
Affiliate)

Primrose Retirement Community of Grand Island

  

3990 West Capital Avenue

Grand Island, Nebraska 68803

   $ 9,000,000.00      

CHT Grand Island NE Senior Living, LLC, a Delaware limited liability company

Primrose Retirement Community of Mansfield

  

1301 Millsboro Road

Mansfield, Ohio 44906

   $ 12,245,000.00      

CHT Mansfield OH Senior Living, LLC, a Delaware limited liability company

Primrose Retirement Community of Marion

  

1550 Wellness Drive

Marion, Ohio 43302

   $ 10,157,000.00      

CHT Marion OH Senior Living, LLC, a Delaware limited liability company

Primrose Retirement Community of Casper

  

1865 South Beverly Street

Casper, Wyoming 82609

   $ 12,758,000.00      

CHT Casper WY Senior Living, LLC, a Delaware limited liability company

 

Modifications to Security Instrument (Cross-Default and Cross-Collateralization:
Multi-Note)   Form 6305   Page D-1 Fannie Mae   01-11   © 2011 Fannie Mae

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Initial Page to Exhibit D to Security Instrument

 

/s/ JJT

Borrower’s Initials