Exhibit 10.14

Loan No.: 502856399

 

51 Imclone Drive, Branchburg, New Jersey

PROMISSORY NOTE

$4,500,000.00

 

May 9, 2006

FOR VALUE RECEIVED, the undersigned, 51 CHUBB SPE LLC, a Delaware limited
liability company (“Borrower”), having an address c/o Mack-Cali Realty, L.P. at
11 Commerce Drive, Cranford, New Jersey 07016, promises to pay to the order of
WACHOVIA BANK, NATIONAL ASSOCIATION, a national banking association (together
with its successors and assigns, “Lender”), at the office of Lender at
Commercial Real Estate Services, 8739 Research Drive URP - 4, NC 1075,
Charlotte, North Carolina 28262, or at such other place as Lender may designate
to Borrower in writing from time to time, the principal sum of FOUR MILLION FIVE
HUNDRED THOUSAND AND NO/100 DOLLARS ($4,500,000.00), together with interest on
so much thereof as is from time to time outstanding and unpaid, from the date of
the advance of the principal evidenced hereby, at the rate of six and
twenty-seven hundredths percent (6.27%) (the “Note Rate”), together with all
other amounts due hereunder or under the other Loan Documents (as defined
herein), in lawful money of the United States of America, which shall at the
time of payment be legal tender in payment of all debts and dues, public and
private.

ARTICLE I

TERMS AND CONDITIONS

SECTION 1.1             COMPUTATION OF INTEREST. INTEREST SHALL BE COMPUTED
HEREUNDER BASED ON A 360-DAY YEAR AND BASED ON THE ACTUAL NUMBER OF DAYS ELAPSED
FOR ANY PERIOD IN WHICH INTEREST IS BEING CALCULATED INCLUDING, WITHOUT
LIMITATION, THE INTEREST ONLY PERIOD (HEREINAFTER DEFINED), AS MORE PARTICULARLY
SET FORTH ON ANNEX 1 ATTACHED HERETO AND INCORPORATED BY THIS REFERENCE.
INTEREST SHALL ACCRUE FROM THE DATE ON WHICH FUNDS ARE ADVANCED HEREUNDER
(REGARDLESS OF THE TIME OF DAY) THROUGH AND INCLUDING THE DAY ON WHICH FUNDS ARE
CREDITED PURSUANT TO SECTION 1.2 HEREOF.

SECTION 1.2             PAYMENT OF PRINCIPAL AND INTEREST. PAYMENTS IN FEDERAL
FUNDS IMMEDIATELY AVAILABLE AT THE PLACE DESIGNATED FOR PAYMENT RECEIVED BY
LENDER PRIOR TO 2:00 P.M. LOCAL TIME ON A DAY ON WHICH LENDER IS OPEN FOR
BUSINESS AT SAID PLACE OF PAYMENT SHALL BE CREDITED PRIOR TO CLOSE OF BUSINESS,
WHILE OTHER PAYMENTS, AT THE OPTION OF LENDER, MAY NOT BE CREDITED UNTIL
IMMEDIATELY AVAILABLE TO LENDER IN FEDERAL FUNDS AT THE PLACE DESIGNATED FOR
PAYMENT PRIOR TO 2:00 P.M. LOCAL TIME ON THE NEXT DAY ON WHICH LENDER IS OPEN
FOR BUSINESS. SUCH PRINCIPAL AND INTEREST SHALL BE PAYABLE IN CONSECUTIVE
MONTHLY INSTALLMENTS OF $27,765.83 EACH, BEGINNING ON JUNE 11, 2006 (THE “FIRST
PAYMENT DATE”), AND CONTINUING ON THE ELEVENTH (11TH) DAY OF EACH AND EVERY
CALENDAR MONTH THEREAFTER THROUGH AND INCLUDING APRIL 11, 2016 (EACH, A “PAYMENT
DATE”). ON MAY 11, 2016 (THE “MATURITY DATE”) (PROVIDED THAT IN THE EVENT THAT
THERE IS A DEFEASANCE OF THE LOAN PURSUANT TO SECTION 1.5(D) HEREOF, THE
MATURITY DATE SHALL

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

AUTOMATICALLY BE THE LOCKOUT EXPIRATION DATE), THE ENTIRE OUTSTANDING PRINCIPAL
BALANCE HEREOF, TOGETHER WITH ALL ACCRUED BUT UNPAID INTEREST THEREON, SHALL BE
DUE AND PAYABLE IN FULL.

SECTION 1.3             APPLICATION OF PAYMENTS. SO LONG AS NO EVENT OF DEFAULT
(AS HEREINAFTER DEFINED) EXISTS HEREUNDER OR UNDER ANY OTHER LOAN DOCUMENT, EACH
SUCH MONTHLY INSTALLMENT SHALL BE APPLIED, FIRST, TO ANY AMOUNTS HEREAFTER
ADVANCED BY LENDER HEREUNDER OR UNDER ANY OTHER LOAN DOCUMENT, SECOND, TO ANY
LATE FEES AND OTHER AMOUNTS PAYABLE TO LENDER, THIRD, TO THE PAYMENT OF ACCRUED
INTEREST AND LAST TO REDUCTION OF PRINCIPAL.

SECTION 1.4             PAYMENT OF “SHORT INTEREST”. IF THE ADVANCE OF THE
PRINCIPAL AMOUNT EVIDENCED BY THIS NOTE IS MADE ON A DATE OTHER THAN A PAYMENT
DATE, BORROWER SHALL PAY TO LENDER CONTEMPORANEOUSLY WITH THE EXECUTION HEREOF
INTEREST AT THE NOTE RATE FOR A PERIOD FROM THE DATE HEREOF THROUGH AND
INCLUDING THE TENTH (10TH) DAY OF EITHER (X) THIS MONTH, IN THE EVENT THAT THE
DATE HEREOF IS ON OR PRIOR TO THE 11TH OF THE MONTH, AND (Y) THE IMMEDIATELY
SUCCEEDING MONTH, IN THE EVENT THAT THE DATE HEREOF IS AFTER THE 11TH OF THE
MONTH.

SECTION 1.5             PREPAYMENT; DEFEASANCE.

(A)           THIS NOTE MAY NOT BE PREPAID, IN WHOLE OR IN PART (EXCEPT AS
OTHERWISE SPECIFICALLY PROVIDED HEREIN), AT ANY TIME PRIOR TO THE PAYMENT DATE
OCCURRING THREE (3) PAYMENT DATES IMMEDIATELY PRIOR TO THE MATURITY DATE (THE
“LOCKOUT EXPIRATION DATE”). IN THE EVENT THAT BORROWER WISHES TO HAVE THE
PROPERTY (AS HEREINAFTER DEFINED) RELEASED FROM THE LIEN OF THE SECURITY
INSTRUMENT PRIOR TO THE LOCKOUT EXPIRATION DATE, BORROWER’S SOLE OPTION SHALL BE
A DEFEASANCE (AS HEREINAFTER DEFINED) UPON SATISFACTION OF THE TERMS AND
CONDITIONS SET FORTH IN SECTION 1.5(D) HEREOF. THIS NOTE MAY BE PREPAID IN WHOLE
BUT NOT IN PART WITHOUT PREMIUM OR PENALTY ON ANY PAYMENT DATE OCCURRING ON OR
AFTER THE LOCKOUT EXPIRATION DATE PROVIDED (I) WRITTEN NOTICE OF SUCH PREPAYMENT
IS RECEIVED BY LENDER NOT MORE THAN NINETY (90) DAYS AND NOT LESS THAN THIRTY
(30) DAYS PRIOR TO THE DATE OF SUCH PREPAYMENT, AND (II) SUCH PREPAYMENT IS
ACCOMPANIED BY ALL INTEREST ACCRUED HEREUNDER THROUGH AND INCLUDING THE DATE OF
SUCH PREPAYMENT AND ALL OTHER SUMS DUE HEREUNDER OR UNDER THE OTHER LOAN
DOCUMENTS. IF, UPON ANY SUCH PERMITTED PREPAYMENT ON ANY PAYMENT DATE OCCURRING
ON OR AFTER THE LOCKOUT EXPIRATION DATE, THE AFORESAID PRIOR WRITTEN NOTICE HAS
NOT BEEN TIMELY RECEIVED BY LENDER, THERE SHALL BE DUE A PREPAYMENT FEE EQUAL TO
THE LESSER OF (I) THIRTY (30) DAYS’ INTEREST COMPUTED AT THE NOTE RATE ON THE
OUTSTANDING PRINCIPAL BALANCE OF THIS NOTE SO PREPAID AND (II) INTEREST COMPUTED
AT THE NOTE RATE ON THE OUTSTANDING PRINCIPAL BALANCE OF THIS NOTE SO PREPAID
THAT WOULD HAVE BEEN PAYABLE FOR THE PERIOD FROM, AND INCLUDING, THE DATE OF
PREPAYMENT THROUGH THE MATURITY DATE, AS THOUGH SUCH PREPAYMENT HAD NOT
OCCURRED.

(B)           IF, PRIOR TO THE LOCKOUT EXPIRATION DATE, THE INDEBTEDNESS
EVIDENCED BY THIS NOTE SHALL HAVE BEEN DECLARED DUE AND PAYABLE BY LENDER
PURSUANT TO ARTICLE II HEREOF OR THE PROVISIONS OF ANY OTHER LOAN DOCUMENT DUE
TO A DEFAULT BY BORROWER, THEN, IN ADDITION TO THE INDEBTEDNESS EVIDENCED BY
THIS NOTE BEING IMMEDIATELY DUE AND PAYABLE, THERE SHALL ALSO THEN BE
IMMEDIATELY DUE AND PAYABLE A PREPAYMENT FEE IN AN AMOUNT EQUAL TO THE YIELD
MAINTENANCE PREMIUM (AS HEREINAFTER DEFINED) BASED ON THE ENTIRE INDEBTEDNESS ON
THE DATE OF SUCH ACCELERATION. IN ADDITION TO THE AMOUNTS DESCRIBED IN THE
PRECEDING SENTENCE, IN THE EVENT OF ANY SUCH ACCELERATION OR TENDER OF PAYMENT
OF SUCH INDEBTEDNESS OCCURS OR IS MADE ON OR PRIOR TO THE FIRST (1ST)
ANNIVERSARY OF THE DATE OF THIS NOTE, THERE SHALL ALSO THEN BE IMMEDIATELY DUE
AND

2

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

PAYABLE AN ADDITIONAL PREPAYMENT FEE OF THREE PERCENT (3%) OF THE PRINCIPAL
BALANCE OF THIS NOTE. THE TERM “YIELD MAINTENANCE PREMIUM” SHALL MEAN AN AMOUNT
EQUAL TO THE GREATER OF (A) ONE PERCENT (1%) OF THE PRINCIPAL AMOUNT BEING
PREPAID, AND (B) THE PRESENT VALUE OF A SERIES OF PAYMENTS EACH EQUAL TO THE
PAYMENT DIFFERENTIAL (AS HEREINAFTER DEFINED) AND PAYABLE ON EACH PAYMENT DATE
OVER THE REMAINING ORIGINAL TERM OF THIS NOTE AND ON THE MATURITY DATE,
DISCOUNTED AT THE REINVESTMENT YIELD (AS HEREINAFTER DEFINED) FOR THE NUMBER OF
MONTHS REMAINING AS OF THE DATE OF SUCH PREPAYMENT TO EACH SUCH PAYMENT DATE AND
THE MATURITY DATE. THE TERM “PAYMENT DIFFERENTIAL” SHALL MEAN AN AMOUNT EQUAL TO
(I) THE NOTE RATE LESS THE REINVESTMENT YIELD, DIVIDED BY (II) TWELVE (12) AND
MULTIPLIED BY (III) THE PRINCIPAL SUM OUTSTANDING UNDER THIS NOTE AFTER
APPLICATION OF THE CONSTANT MONTHLY PAYMENT DUE UNDER THIS NOTE ON THE DATE OF
SUCH PREPAYMENT, PROVIDED THAT THE PAYMENT DIFFERENTIAL SHALL IN NO EVENT BE
LESS THAN ZERO. THE TERM “REINVESTMENT YIELD” SHALL MEAN AN AMOUNT EQUAL TO THE
LESSER OF (I) THE YIELD ON THE U.S. TREASURY ISSUE (PRIMARY ISSUE) WITH A
MATURITY DATE CLOSEST TO THE MATURITY DATE, OR (II) THE YIELD ON THE U.S.
TREASURY ISSUE (PRIMARY ISSUE) WITH A TERM EQUAL TO THE REMAINING AVERAGE LIFE
OF THE INDEBTEDNESS EVIDENCED BY THIS NOTE, WITH EACH SUCH YIELD BEING BASED ON
THE BID PRICE FOR SUCH ISSUE AS PUBLISHED IN THE WALL STREET JOURNAL ON THE DATE
THAT IS FOURTEEN (14) DAYS PRIOR TO THE DATE OF SUCH PREPAYMENT (OR, IF SUCH BID
PRICE IS NOT PUBLISHED ON THAT DATE, THE NEXT PRECEDING DATE ON WHICH SUCH BID
PRICE IS SO PUBLISHED) AND CONVERTED TO A MONTHLY COMPOUNDED NOMINAL YIELD. IN
THE EVENT THAT ANY PREPAYMENT FEE IS DUE HEREUNDER, LENDER SHALL DELIVER TO
BORROWER A STATEMENT SETTING FORTH THE AMOUNT AND DETERMINATION OF THE
PREPAYMENT FEE, AND, PROVIDED THAT LENDER SHALL HAVE IN GOOD FAITH APPLIED THE
FORMULA DESCRIBED ABOVE, BORROWER SHALL NOT HAVE THE RIGHT TO CHALLENGE THE
CALCULATION OR THE METHOD OF CALCULATION SET FORTH IN ANY SUCH STATEMENT IN THE
ABSENCE OF MANIFEST ERROR, WHICH CALCULATION MAY BE MADE BY LENDER ON ANY DAY
DURING THE FIFTEEN (15) DAY PERIOD PRECEDING THE DATE OF SUCH PREPAYMENT. LENDER
SHALL NOT BE OBLIGATED OR REQUIRED TO HAVE ACTUALLY REINVESTED THE PREPAID
PRINCIPAL BALANCE AT THE REINVESTMENT YIELD OR OTHERWISE AS A CONDITION TO
RECEIVING THE PREPAYMENT FEE.

(C)           PARTIAL PREPAYMENTS OF THIS NOTE SHALL NOT BE PERMITTED, EXCEPT
FOR PARTIAL PREPAYMENTS RESULTING FROM LENDER’S ELECTION TO APPLY INSURANCE OR
CONDEMNATION PROCEEDS TO REDUCE THE OUTSTANDING PRINCIPAL BALANCE OF THIS NOTE
AS PROVIDED IN THE SECURITY INSTRUMENT, IN WHICH EVENT NO PREPAYMENT FEE OR
PREMIUM SHALL BE DUE UNLESS, AT THE TIME OF EITHER LENDER’S RECEIPT OF SUCH
PROCEEDS OR THE APPLICATION OF SUCH PROCEEDS TO THE OUTSTANDING PRINCIPAL
BALANCE OF THIS NOTE, AN EVENT OF DEFAULT, OR AN EVENT WHICH, WITH NOTICE OR THE
PASSAGE OF TIME, OR BOTH, WOULD CONSTITUTE AN EVENT OF DEFAULT, SHALL HAVE
OCCURRED, WHICH DEFAULT OR EVENT OF DEFAULT IS UNRELATED TO THE APPLICABLE
CASUALTY OR CONDEMNATION, IN WHICH EVENT THE APPLICABLE PREPAYMENT FEE OR
PREMIUM SHALL BE DUE AND PAYABLE BASED UPON THE AMOUNT OF THE PREPAYMENT. NO
NOTICE OF PREPAYMENT SHALL BE REQUIRED UNDER THE CIRCUMSTANCES SPECIFIED IN THE
PRECEDING SENTENCE. NO PRINCIPAL AMOUNT REPAID MAY BE REBORROWED. ANY SUCH
PARTIAL PREPAYMENTS OF PRINCIPAL SHALL BE APPLIED TO THE UNPAID PRINCIPAL
BALANCE EVIDENCED HEREBY BUT SUCH APPLICATION SHALL NOT REDUCE THE AMOUNT OF THE
FIXED MONTHLY INSTALLMENTS REQUIRED TO BE PAID PURSUANT TO SECTION 1.2 ABOVE.
EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN THIS SECTION, THE PREPAYMENT FEES
PROVIDED ABOVE SHALL BE DUE, TO THE EXTENT PERMITTED BY APPLICABLE LAW, UNDER
ANY AND ALL CIRCUMSTANCES WHERE ALL OR ANY PORTION OF THIS NOTE IS PAID PRIOR TO
THE MATURITY DATE, WHETHER SUCH PREPAYMENT IS VOLUNTARY OR INVOLUNTARY,
INCLUDING, WITHOUT LIMITATION, IF SUCH PREPAYMENT RESULTS FROM LENDER’S EXERCISE
OF ITS RIGHTS UPON BORROWER’S DEFAULT AND ACCELERATION OF THE MATURITY DATE OF
THIS NOTE (IRRESPECTIVE OF WHETHER FORECLOSURE PROCEEDINGS HAVE BEEN COMMENCED),
AND SHALL BE IN ADDITION TO ANY OTHER SUMS DUE HEREUNDER OR UNDER ANY OF THE
OTHER LOAN DOCUMENTS. NO TENDER OF A

3

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

PREPAYMENT OF THIS NOTE WITH RESPECT TO WHICH A PREPAYMENT FEE IS DUE SHALL BE
EFFECTIVE UNLESS SUCH PREPAYMENT IS ACCOMPANIED BY THE APPLICABLE PREPAYMENT
FEE.

(D)           (I)  ON ANY PAYMENT DATE ON OR AFTER THE EARLIER TO OCCUR OF
(X) THREE (3) YEARS FOLLOWING THE FIRST PAYMENT DATE HEREUNDER, AND (Y) THE DAY
IMMEDIATELY FOLLOWING THE DATE WHICH IS TWO (2) YEARS AFTER THE “STARTUP DAY,”
WITHIN THE MEANING OF SECTION 860G(A) (9) OF THE INTERNAL REVENUE CODE OF 1986,
AS AMENDED FROM TIME TO TIME OR ANY SUCCESSOR STATUTE (THE “CODE”), OF A “REAL
ESTATE MORTGAGE INVESTMENT CONDUIT,” WITHIN THE MEANING OF SECTION 860D OF THE
CODE (A “REMIC TRUST”), THAT HOLDS THIS NOTE, AND PROVIDED NO EVENT OF DEFAULT
HAS OCCURRED AND IS CONTINUING HEREUNDER OR UNDER ANY OF THE OTHER LOAN
DOCUMENTS, AT BORROWER’S OPTION, LENDER SHALL CAUSE THE RELEASE OF THE PROPERTY
FROM THE LIEN OF THE SECURITY INSTRUMENT AND THE OTHER LOAN DOCUMENTS (A
“DEFEASANCE”) UPON THE SATISFACTION OF THE FOLLOWING CONDITIONS:

(A)          BORROWER SHALL GIVE NOT MORE THAN NINETY (90) DAYS’ OR LESS THAN
SIXTY (60) DAYS’ PRIOR WRITTEN NOTICE TO LENDER SPECIFYING THE DATE BORROWER
INTENDS FOR THE DEFEASANCE TO BE CONSUMMATED (THE “RELEASE DATE”), WHICH DATE
SHALL BE A PAYMENT DATE.

(B)           ALL ACCRUED AND UNPAID INTEREST AND ALL OTHER SUMS DUE UNDER THIS
NOTE AND UNDER THE OTHER LOAN DOCUMENTS UP TO AND INCLUDING THE RELEASE DATE
SHALL BE PAID IN FULL ON OR PRIOR TO THE RELEASE DATE.

(C)           BORROWER SHALL DELIVER TO LENDER ON OR PRIOR TO THE RELEASE DATE:

(1)           A SUM OF MONEY IN IMMEDIATELY AVAILABLE FUNDS (THE “DEFEASANCE
DEPOSIT”) EQUAL TO THE OUTSTANDING PRINCIPAL BALANCE OF THIS NOTE PLUS AN
AMOUNT, IF ANY, WHICH TOGETHER WITH THE OUTSTANDING PRINCIPAL BALANCE OF THIS
NOTE, SHALL BE SUFFICIENT TO ENABLE LENDER TO PURCHASE, THROUGH MEANS AND
SOURCES CUSTOMARILY EMPLOYED AND AVAILABLE TO LENDER, FOR THE ACCOUNT OF
BORROWER, (X) DIRECT, NON-CALLABLE, FIXED RATE OBLIGATIONS OF THE UNITED STATES
OF AMERICA OR (Y) NON-CALLABLE, FIXED RATE OBLIGATIONS, OTHER THAN U.S. TREASURY
OBLIGATIONS, THAT ARE “GOVERNMENT SECURITIES” WITHIN THE MEANING OF
SECTION 2(A)(16) OF THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED, THAT PROVIDE
FOR PAYMENTS PRIOR, BUT AS CLOSE AS POSSIBLE, TO ALL SUCCESSIVE MONTHLY PAYMENT
DATES OCCURRING AFTER THE RELEASE DATE AND TO THE LOCKOUT EXPIRATION DATE, WITH
EACH SUCH PAYMENT BEING EQUAL TO OR GREATER THAN THE AMOUNT OF THE CORRESPONDING
INSTALLMENT OF PRINCIPAL AND/OR INTEREST REQUIRED TO BE PAID UNDER THIS NOTE
(INCLUDING, BUT NOT LIMITED TO, THE SCHEDULED OUTSTANDING PRINCIPAL BALANCE OF
THE LOAN DUE ON THE MATURITY DATE BASED UPON PAYMENTS OF PRINCIPAL AND INTEREST
THROUGH THE LOCKOUT EXPIRATION DATE) FOR THE BALANCE OF THE TERM HEREOF (THE
“DEFEASANCE COLLATERAL”), EACH OF WHICH SHALL BE DULY ENDORSED BY THE HOLDER
THEREOF AS DIRECTED BY LENDER OR ACCOMPANIED BY A WRITTEN INSTRUMENT OF TRANSFER
IN FORM AND SUBSTANCE SATISFACTORY TO LENDER IN ITS SOLE DISCRETION (INCLUDING,
WITHOUT LIMITATION, SUCH INSTRUMENTS AS MAY BE REQUIRED BY THE DEPOSITORY
INSTITUTION HOLDING SUCH SECURITIES OR THE ISSUER

4

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

THEREOF, AS THE CASE MAY BE, TO EFFECTUATE BOOK-ENTRY TRANSFERS AND PLEDGES
THROUGH THE BOOK-ENTRY FACILITIES OF SUCH INSTITUTION) IN ORDER TO PERFECT UPON
THE DELIVERY OF THE DEFEASANCE SECURITY AGREEMENT (AS HEREINAFTER DEFINED) THE
FIRST PRIORITY SECURITY INTEREST IN THE DEFEASANCE COLLATERAL IN FAVOR OF LENDER
IN CONFORMITY WITH ALL APPLICABLE STATE AND FEDERAL LAWS GOVERNING GRANTING OF
SUCH SECURITY INTERESTS.

(2)           A PLEDGE AND SECURITY AGREEMENT, IN FORM AND SUBSTANCE
SATISFACTORY TO LENDER, CREATING A FIRST PRIORITY SECURITY INTEREST IN FAVOR OF
LENDER IN THE DEFEASANCE COLLATERAL (THE “DEFEASANCE SECURITY AGREEMENT”);

(3)           A CERTIFICATE OF BORROWER CERTIFYING THAT ALL OF THE REQUIREMENTS
SET FORTH IN THIS SUBSECTION 1.5(D)(I) HAVE BEEN SATISFIED;

(4)           ONE OR MORE OPINIONS OF COUNSEL FOR BORROWER IN FORM AND SUBSTANCE
AND DELIVERED BY COUNSEL WHICH WOULD BE SATISFACTORY TO LENDER STATING, AMONG
OTHER THINGS, THAT (I) LENDER HAS A PERFECTED FIRST PRIORITY SECURITY INTEREST
IN THE DEFEASANCE COLLATERAL AND THAT THE DEFEASANCE SECURITY AGREEMENT IS
ENFORCEABLE AGAINST BORROWER IN ACCORDANCE WITH ITS TERMS, (II) IN THE EVENT OF
A BANKRUPTCY PROCEEDING OR SIMILAR OCCURRENCE WITH RESPECT TO BORROWER, NONE OF
THE DEFEASANCE COLLATERAL NOR ANY PROCEEDS THEREOF WILL BE PROPERTY OF
BORROWER’S ESTATE UNDER SECTION 541 OF THE U.S. BANKRUPTCY CODE, AS AMENDED, OR
ANY SIMILAR STATUTE AND THE GRANT OF SECURITY INTEREST THEREIN TO LENDER SHALL
NOT CONSTITUTE AN AVOIDABLE PREFERENCE UNDER SECTION 547 OF THE U.S. BANKRUPTCY
CODE, AS AMENDED, OR APPLICABLE STATE LAW, (III) THE RELEASE OF THE LIEN OF THE
SECURITY INSTRUMENT AND THE PLEDGE OF DEFEASANCE COLLATERAL WILL NOT DIRECTLY OR
INDIRECTLY RESULT IN OR CAUSE ANY REMIC TRUST THAT THEN HOLDS THIS NOTE TO FAIL
TO MAINTAIN ITS STATUS AS A REMIC TRUST AND (IV) THE DEFEASANCE WILL NOT CAUSE
ANY REMIC TRUST TO BE AN “INVESTMENT COMPANY” UNDER THE INVESTMENT COMPANY ACT
OF 1940;

(5)           EVIDENCE IN WRITING FROM ANY APPLICABLE RATING AGENCY (AS DEFINED
IN THE SECURITY INSTRUMENT) TO THE EFFECT THAT THE DEFEASANCE WILL NOT RESULT IN
A DOWNGRADING, WITHDRAWAL OR QUALIFICATION OF THE RESPECTIVE RATINGS IN EFFECT
IMMEDIATELY PRIOR TO SUCH DEFEASANCE FOR ANY SECURITIES (AS HEREINAFTER DEFINED)
ISSUED IN CONNECTION WITH THE SECURITIZATION WHICH ARE THEN OUTSTANDING;
PROVIDED, HOWEVER, NO EVIDENCE FROM A RATING AGENCY SHALL BE REQUIRED IF THIS
NOTE DOES NOT MEET THE THEN-CURRENT REVIEW REQUIREMENTS OF SUCH RATING AGENCY.

(6)           A CERTIFICATE IN FORM AND SCOPE ACCEPTABLE TO LENDER IN ITS SOLE
DISCRETION FROM AN ACCEPTABLE INDEPENDENT ACCOUNTANT CERTIFYING THAT THE
DEFEASANCE COLLATERAL WILL GENERATE AMOUNTS SUFFICIENT TO MAKE ALL PAYMENTS OF
PRINCIPAL AND INTEREST DUE UNDER THIS NOTE THROUGH THE LOCKOUT EXPIRATION DATE
AND THE OUTSTANDING PRINCIPAL BALANCE OF THE LOAN

5

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

DUE ON THE MATURITY DATE BASED UPON PAYMENTS OF PRINCIPAL AND INTEREST THROUGH
THE LOCKOUT EXPIRATION DATE;

(7)           BORROWER AND ANY GUARANTOR OR INDEMNITOR OF BORROWER’S OBLIGATIONS
UNDER THE LOAN DOCUMENTS FOR WHICH BORROWER HAS PERSONAL LIABILITY EXECUTES AND
DELIVERS TO LENDER SUCH DOCUMENTS AND AGREEMENTS AS LENDER SHALL REASONABLY
REQUIRE TO EVIDENCE AND EFFECTUATE THE RATIFICATION OF SUCH PERSONAL LIABILITY
AND GUARANTY OR INDEMNITY, RESPECTIVELY;

(8)           SUCH OTHER CERTIFICATES, DOCUMENTS OR INSTRUMENTS AS LENDER MAY
REASONABLY REQUIRE; AND

(9)           PAYMENT OF ALL FEES, COSTS, EXPENSES AND CHARGES INCURRED BY
LENDER IN CONNECTION WITH THE DEFEASANCE OF THE PROPERTY AND THE PURCHASE OF THE
DEFEASANCE COLLATERAL, INCLUDING, WITHOUT LIMITATION, ALL LEGAL FEES AND COSTS
AND EXPENSES INCURRED BY LENDER OR ITS AGENTS IN CONNECTION WITH RELEASE OF THE
PROPERTY, REVIEW OF THE PROPOSED DEFEASANCE COLLATERAL AND PREPARATION OF THE
DEFEASANCE SECURITY AGREEMENT AND RELATED DOCUMENTATION, ANY REVENUE,
DOCUMENTARY, STAMP, INTANGIBLE OR OTHER TAXES, CHARGES OR FEES DUE IN CONNECTION
WITH TRANSFER OF THE NOTE, ASSUMPTION OF THE NOTE, OR SUBSTITUTION OF COLLATERAL
FOR THE PROPERTY SHALL BE PAID ON OR BEFORE THE RELEASE DATE. WITHOUT LIMITING
BORROWER’S OBLIGATIONS WITH RESPECT THERETO, LENDER SHALL BE ENTITLED TO DEDUCT
ALL SUCH FEES, COSTS, EXPENSES AND CHARGES FROM THE DEFEASANCE DEPOSIT TO THE
EXTENT OF ANY PORTION OF THE DEFEASANCE DEPOSIT WHICH EXCEEDS THE AMOUNT
NECESSARY TO PURCHASE THE DEFEASANCE COLLATERAL.

(D)          IN CONNECTION WITH THE DEFEASANCE DEPOSIT, BORROWER HEREBY
AUTHORIZES AND DIRECTS LENDER USING THE MEANS AND SOURCES CUSTOMARILY EMPLOYED
AND AVAILABLE TO LENDER TO USE THE DEFEASANCE DEPOSIT TO PURCHASE FOR THE
ACCOUNT OF BORROWER THE DEFEASANCE COLLATERAL. FURTHERMORE, THE DEFEASANCE
COLLATERAL SHALL BE ARRANGED SUCH THAT PAYMENTS RECEIVED FROM SUCH DEFEASANCE
COLLATERAL SHALL BE PAID DIRECTLY TO LENDER TO BE APPLIED ON ACCOUNT OF THE
INDEBTEDNESS OF THIS NOTE. ANY PART OF THE DEFEASANCE DEPOSIT IN EXCESS OF THE
AMOUNT NECESSARY TO PURCHASE THE DEFEASANCE COLLATERAL AND TO PAY THE OTHER AND
RELATED COSTS BORROWER IS OBLIGATED TO PAY UNDER THIS SECTION 1.5 SHALL BE
REFUNDED TO BORROWER.

(II)      UPON COMPLIANCE WITH THE REQUIREMENTS OF SUBSECTION 1.5(D)(I), THE
PROPERTY SHALL BE RELEASED FROM THE LIEN OF THE SECURITY INSTRUMENT AND THE
OTHER LOAN DOCUMENTS, AND THE DEFEASANCE COLLATERAL SHALL CONSTITUTE COLLATERAL
WHICH SHALL SECURE THIS NOTE AND ALL OTHER OBLIGATIONS UNDER THE LOAN DOCUMENTS.
LENDER WILL, AT BORROWER’S EXPENSE, EXECUTE AND DELIVER ANY AGREEMENTS
REASONABLY REQUESTED BY BORROWER TO RELEASE THE LIEN OF THE SECURITY INSTRUMENT
FROM THE PROPERTY.

(III)     UPON THE RELEASE OF THE PROPERTY IN ACCORDANCE WITH THIS
SECTION 1.5(D), BORROWER SHALL ASSIGN ALL ITS OBLIGATIONS AND RIGHTS UNDER THIS
NOTE, TOGETHER WITH THE

6

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

PLEDGED DEFEASANCE COLLATERAL, TO A NEWLY CREATED SUCCESSOR ENTITY WHICH
COMPLIES WITH THE TERMS OF SECTION 2.29 OF THE SECURITY INSTRUMENT DESIGNATED BY
LENDER IN ITS SOLE DISCRETION. SUCH SUCCESSOR ENTITY SHALL EXECUTE AN ASSUMPTION
AGREEMENT IN FORM AND SUBSTANCE SATISFACTORY TO LENDER IN ITS SOLE DISCRETION
PURSUANT TO WHICH IT SHALL ASSUME BORROWER’S OBLIGATIONS UNDER THIS NOTE AND THE
DEFEASANCE SECURITY AGREEMENT. AS CONDITIONS TO SUCH ASSIGNMENT AND ASSUMPTION,
BORROWER SHALL (X) DELIVER TO LENDER AN OPINION OF COUNSEL IN FORM AND SUBSTANCE
SATISFACTORY TO A PRUDENT LENDER AND DELIVERED BY COUNSEL SATISFACTORY TO A
PRUDENT LENDER STATING, AMONG OTHER THINGS, THAT SUCH ASSUMPTION AGREEMENT IS
ENFORCEABLE AGAINST BORROWER AND SUCH SUCCESSOR ENTITY IN ACCORDANCE WITH ITS
TERMS AND THAT THIS NOTE AND THE DEFEASANCE SECURITY AGREEMENT AS SO ASSUMED,
ARE ENFORCEABLE AGAINST SUCH SUCCESSOR ENTITY IN ACCORDANCE WITH THEIR
RESPECTIVE TERMS, AND (Y) PAY ALL COSTS AND EXPENSES (INCLUDING, BUT NOT LIMITED
TO, LEGAL FEES) INCURRED BY LENDER OR ITS AGENTS IN CONNECTION WITH SUCH
ASSIGNMENT AND ASSUMPTION (INCLUDING, WITHOUT LIMITATION, THE REVIEW OF THE
PROPOSED TRANSFEREE AND THE PREPARATION OF THE ASSUMPTION AGREEMENT AND RELATED
DOCUMENTATION). UPON SUCH ASSUMPTION, BORROWER SHALL BE RELIEVED OF ITS
OBLIGATIONS HEREUNDER, UNDER THE OTHER LOAN DOCUMENTS OTHER THAN AS SPECIFIED IN
SECTION 1.5(D)(I)(C)(7) ABOVE AND UNDER THE DEFEASANCE SECURITY AGREEMENT (OR
OTHER DEFEASANCE DOCUMENT).

SECTION 1.6             SECURITY. THE INDEBTEDNESS EVIDENCED BY THIS NOTE AND
THE OBLIGATIONS CREATED HEREBY ARE SECURED BY, AMONG OTHER THINGS, THAT CERTAIN
MORTGAGE, DEED OF TRUST OR DEED TO SECURE DEBT, SECURITY AGREEMENT AND FIXTURE
FILING (THE “SECURITY INSTRUMENT”) FROM BORROWER FOR THE BENEFIT OF LENDER,
DATED OF EVEN DATE HEREWITH, COVERING THE PROPERTY. THE SECURITY INSTRUMENT,
TOGETHER WITH THIS NOTE AND ALL OTHER DOCUMENTS TO OR OF WHICH LENDER IS A PARTY
OR BENEFICIARY NOW OR HEREAFTER EVIDENCING, SECURING, GUARANTYING, MODIFYING OR
OTHERWISE RELATING TO THE INDEBTEDNESS EVIDENCED HEREBY, ARE HEREIN REFERRED TO
COLLECTIVELY AS THE “LOAN DOCUMENTS”. ALL OF THE TERMS AND PROVISIONS OF THE
LOAN DOCUMENTS ARE INCORPORATED HEREIN BY REFERENCE. SOME OF THE LOAN DOCUMENTS
ARE TO BE FILED FOR RECORD ON OR ABOUT THE DATE HEREOF IN THE APPROPRIATE PUBLIC
RECORDS.

ARTICLE II

DEFAULT

SECTION 2.1             EVENTS OF DEFAULT. IT IS HEREBY EXPRESSLY AGREED THAT
SHOULD ANY DEFAULT OCCUR IN THE PAYMENT OF PRINCIPAL OR INTEREST AS STIPULATED
ABOVE AND SUCH PAYMENT IS NOT MADE ON THE DATE SUCH PAYMENT IS DUE, OR SHOULD
ANY OTHER DEFAULT OCCUR UNDER ANY OTHER LOAN DOCUMENT AND NOT BE CURED WITHIN
ANY APPLICABLE GRACE OR NOTICE PERIOD (IF ANY), THEN AN EVENT OF DEFAULT (AN
“EVENT OF DEFAULT”) SHALL EXIST HEREUNDER, AND IN SUCH EVENT THE INDEBTEDNESS
EVIDENCED HEREBY, INCLUDING ALL SUMS ADVANCED OR ACCRUED HEREUNDER OR UNDER ANY
OTHER LOAN DOCUMENT, AND ALL UNPAID INTEREST ACCRUED THEREON, SHALL, AT THE
OPTION OF LENDER AND WITHOUT NOTICE TO BORROWER, AT ONCE BECOME DUE AND PAYABLE
AND MAY BE COLLECTED FORTHWITH, WHETHER OR NOT THERE HAS BEEN A PRIOR DEMAND FOR
PAYMENT AND REGARDLESS OF THE STIPULATED DATE OF MATURITY.

SECTION 2.2             LATE CHARGES. IN THE EVENT THAT ANY PAYMENT IS NOT
RECEIVED BY LENDER ON THE DATE WHEN DUE (SUBJECT TO ANY APPLICABLE GRACE
PERIOD), THEN, IN ADDITION TO ANY

7

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

DEFAULT INTEREST PAYMENTS DUE HEREUNDER, BORROWER SHALL ALSO PAY TO LENDER A
LATE CHARGE IN AN AMOUNT EQUAL TO FIVE PERCENT (5%) OF THE AMOUNT OF SUCH
OVERDUE PAYMENT.

SECTION 2.3             DEFAULT INTEREST RATE. SO LONG AS ANY EVENT OF DEFAULT
EXISTS HEREUNDER OR UNDER ANY OTHER LOAN DOCUMENT, REGARDLESS OF WHETHER OR NOT
THERE HAS BEEN AN ACCELERATION OF THE INDEBTEDNESS EVIDENCED HEREBY, AND AT ALL
TIMES AFTER MATURITY OF THE INDEBTEDNESS EVIDENCED HEREBY (WHETHER BY
ACCELERATION OR OTHERWISE), INTEREST SHALL ACCRUE ON THE OUTSTANDING PRINCIPAL
BALANCE OF THIS NOTE, FROM THE DATE DUE UNTIL THE DATE CREDITED, AT A RATE PER
ANNUM EQUAL TO FIVE PERCENT (5%) IN EXCESS OF THE NOTE RATE, OR, IF SUCH
INCREASED RATE OF INTEREST MAY NOT BE COLLECTED UNDER APPLICABLE LAW, THEN AT
THE MAXIMUM RATE OF INTEREST, IF ANY, WHICH MAY BE COLLECTED FROM BORROWER UNDER
APPLICABLE LAW (AS APPLICABLE, THE “DEFAULT INTEREST RATE”), AND SUCH DEFAULT
INTEREST SHALL BE IMMEDIATELY DUE AND PAYABLE.

SECTION 2.4             BORROWER’S AGREEMENTS. BORROWER ACKNOWLEDGES THAT IT
WOULD BE EXTREMELY DIFFICULT OR IMPRACTICABLE TO DETERMINE LENDER’S ACTUAL
DAMAGES RESULTING FROM ANY LATE PAYMENT OR DEFAULT, AND SUCH LATE CHARGES AND
DEFAULT INTEREST ARE REASONABLE ESTIMATES OF THOSE DAMAGES AND DO NOT CONSTITUTE
A PENALTY. THE REMEDIES OF LENDER IN THIS NOTE OR IN THE LOAN DOCUMENTS, OR AT
LAW OR IN EQUITY, SHALL BE CUMULATIVE AND CONCURRENT, AND MAY BE PURSUED SINGLY,
SUCCESSIVELY OR TOGETHER, IN LENDER’S DISCRETION.

SECTION 2.5             BORROWER TO PAY COSTS. IN THE EVENT THAT THIS NOTE, OR
ANY PART HEREOF, IS COLLECTED BY OR THROUGH AN ATTORNEY-AT-LAW, BORROWER AGREES
TO PAY ALL COSTS OF COLLECTION, INCLUDING, BUT NOT LIMITED TO, REASONABLE
ATTORNEYS’ FEES.

SECTION 2.6             EXCULPATION. NOTWITHSTANDING ANYTHING IN THIS NOTE OR
THE LOAN DOCUMENTS TO THE CONTRARY, BUT SUBJECT TO THE QUALIFICATIONS
HEREINBELOW SET FORTH, LENDER AGREES THAT:

(A)           BORROWER SHALL BE LIABLE UPON THE INDEBTEDNESS EVIDENCED HEREBY
AND FOR THE OTHER OBLIGATIONS ARISING UNDER THE LOAN DOCUMENTS TO THE FULL
EXTENT (BUT ONLY TO THE EXTENT) OF THE SECURITY THEREFOR, THE SAME BEING ALL
PROPERTIES (WHETHER REAL OR PERSONAL), RIGHTS, ESTATES AND INTERESTS NOW OR AT
ANY TIME HEREAFTER SECURING THE PAYMENT OF THIS NOTE AND/OR THE OTHER
OBLIGATIONS OF BORROWER UNDER THE LOAN DOCUMENTS (COLLECTIVELY, THE “PROPERTY”);

(B)           IF A DEFAULT OCCURS IN THE TIMELY AND PROPER PAYMENT OF ALL OR ANY
PART OF SUCH INDEBTEDNESS EVIDENCED HEREBY OR IN THE TIMELY AND PROPER
PERFORMANCE OF THE OTHER OBLIGATIONS OF BORROWER UNDER THE LOAN DOCUMENTS, ANY
JUDICIAL PROCEEDINGS BROUGHT BY LENDER AGAINST BORROWER SHALL BE LIMITED TO THE
PRESERVATION, ENFORCEMENT AND FORECLOSURE, OR ANY THEREOF, OF THE LIENS,
SECURITY TITLES, ESTATES, ASSIGNMENTS, RIGHTS AND SECURITY INTERESTS NOW OR AT
ANY TIME HEREAFTER SECURING THE PAYMENT OF THIS NOTE AND/OR THE OTHER
OBLIGATIONS OF BORROWER UNDER THE LOAN DOCUMENTS, AND NO ATTACHMENT, EXECUTION
OR OTHER WRIT OF PROCESS SHALL BE SOUGHT, ISSUED OR LEVIED UPON ANY ASSETS,
PROPERTIES OR FUNDS OF BORROWER OTHER THAN THE PROPERTY, EXCEPT WITH RESPECT TO
THE LIABILITY DESCRIBED BELOW IN THIS SECTION; AND

(C)           IN THE EVENT OF A FORECLOSURE OF SUCH LIENS, SECURITY TITLES,
ESTATES, ASSIGNMENTS, RIGHTS OR SECURITY INTERESTS SECURING THE PAYMENT OF THIS
NOTE AND/OR THE OTHER OBLIGATIONS OF BORROWER UNDER THE LOAN DOCUMENTS, NO
JUDGMENT FOR ANY DEFICIENCY UPON THE

8

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

INDEBTEDNESS EVIDENCED HEREBY SHALL BE SOUGHT OR OBTAINED BY LENDER AGAINST
BORROWER, EXCEPT WITH RESPECT TO THE LIABILITY DESCRIBED BELOW IN THIS SECTION;
PROVIDED, HOWEVER, THAT, NOTWITHSTANDING THE FOREGOING PROVISIONS OF THIS
SECTION, BORROWER SHALL BE FULLY AND PERSONALLY LIABLE AND SUBJECT TO LEGAL
ACTION (I) FOR PROCEEDS PAID UNDER ANY INSURANCE POLICIES (OR PAID AS A RESULT
OF ANY OTHER CLAIM OR CAUSE OF ACTION AGAINST ANY PERSON OR ENTITY) BY REASON OF
DAMAGE, LOSS OR DESTRUCTION TO ALL OR ANY PORTION OF THE PROPERTY, TO THE FULL
EXTENT OF SUCH PROCEEDS NOT PREVIOUSLY DELIVERED TO LENDER, BUT WHICH, UNDER THE
TERMS OF THE LOAN DOCUMENTS, SHOULD HAVE BEEN DELIVERED TO LENDER, (II) FOR
PROCEEDS OR AWARDS RESULTING FROM THE CONDEMNATION OR OTHER TAKING IN LIEU OF
CONDEMNATION OF ALL OR ANY PORTION OF THE PROPERTY, TO THE FULL EXTENT OF SUCH
PROCEEDS OR AWARDS NOT PREVIOUSLY DELIVERED TO LENDER, BUT WHICH, UNDER THE
TERMS OF THE LOAN DOCUMENTS, SHOULD HAVE BEEN DELIVERED TO LENDER, (III) FOR ALL
TENANT SECURITY DEPOSITS OR OTHER REFUNDABLE DEPOSITS PAID TO OR HELD BY
BORROWER OR ANY OTHER PERSON OR ENTITY IN CONNECTION WITH LEASES OF ALL OR ANY
PORTION OF THE PROPERTY WHICH ARE NOT APPLIED IN ACCORDANCE WITH THE TERMS OF
THE APPLICABLE LEASE OR OTHER AGREEMENT, EXCEPT IF LENDER RECEIVES SUCH TENANT
SECURITY DEPOSITS OR OTHER REFUNDABLE DEPOSITS AND FAILS TO REFUND SAME TO THE
APPLICABLE TENANT(S) IN ACCORDANCE WITH SUCH TENANT’S LEASE, (IV) FOR RENT AND
OTHER PAYMENTS RECEIVED FROM TENANTS UNDER LEASES OF ALL OR ANY PORTION OF THE
PROPERTY PAID MORE THAN ONE (1) MONTH IN ADVANCE, PROVIDED THAT WITH RESPECT TO
ANY TAXES AND/OR OPERATING EXPENSES PAID BY ANY TENANTS IN OTHER THAN MONTHLY
INSTALLMENTS UNDER THE APPLICABLE LEASE, SUCH PAYMENTS SHALL NOT BE PAID MORE
THAN ONE INSTALLMENT IN ADVANCE, (V) FOR RENTS, ISSUES, PROFITS AND REVENUES OF
ALL OR ANY PORTION OF THE PROPERTY RECEIVED OR APPLICABLE TO A PERIOD AFTER THE
OCCURRENCE OF ANY EVENT OF DEFAULT HEREUNDER OR UNDER THE LOAN DOCUMENTS WHICH
ARE NOT EITHER APPLIED TO THE ORDINARY AND NECESSARY EXPENSES OF OWNING AND
OPERATING THE PROPERTY OR PAID TO LENDER, (VI) FOR WASTE COMMITTED ON THE
PROPERTY, DAMAGE TO THE PROPERTY AS A RESULT OF THE INTENTIONAL MISCONDUCT OR
GROSS NEGLIGENCE OF BORROWER OR ANY OF ITS PRINCIPALS, OFFICERS, GENERAL
PARTNERS OR MEMBERS, ANY GUARANTOR, ANY INDEMNITOR, OR ANY AGENT OR EMPLOYEE OF
ANY SUCH PERSON, OR ANY REMOVAL OF  ALL OR ANY PORTION OF THE PROPERTY IN
VIOLATION OF THE TERMS OF THE LOAN DOCUMENTS, TO THE FULL EXTENT OF THE LOSSES
OR DAMAGES INCURRED BY LENDER ON ACCOUNT OF SUCH OCCURRENCE, (VII) FOR FAILURE
TO PAY ANY VALID TAXES, ASSESSMENTS, MECHANIC’S LIENS, MATERIALMEN’S LIENS OR
OTHER LIENS WHICH COULD CREATE LIENS ON ANY PORTION OF THE PROPERTY WHICH WOULD
BE SUPERIOR TO THE LIEN OR SECURITY TITLE OF THE SECURITY INSTRUMENT OR THE
OTHER LOAN DOCUMENTS, TO THE FULL EXTENT OF THE AMOUNT CLAIMED BY ANY SUCH LIEN
CLAIMANT EXCEPT, WITH RESPECT TO ANY SUCH TAXES OR ASSESSMENTS, TO THE EXTENT
THAT FUNDS HAVE BEEN DEPOSITED WITH LENDER PURSUANT TO THE TERMS OF THE SECURITY
INSTRUMENT SPECIFICALLY FOR THE APPLICABLE TAXES OR ASSESSMENTS AND NOT APPLIED
BY LENDER TO PAY SUCH TAXES AND ASSESSMENTS, (VIII) FOR ALL OBLIGATIONS AND
INDEMNITIES OF BORROWER UNDER THE LOAN DOCUMENTS RELATING TO HAZARDOUS
SUBSTANCES (AS DEFINED IN THE SECURITY INSTRUMENT) OR RADON OR COMPLIANCE WITH
ENVIRONMENTAL LAWS (AS DEFINED IN THE SECURITY INSTRUMENT) AND REGULATIONS TO
THE FULL EXTENT OF ANY LOSSES OR DAMAGES (INCLUDING THOSE RESULTING FROM
DIMINUTION IN VALUE OF ANY PROPERTY) INCURRED BY LENDER AND/OR ANY OF ITS
AFFILIATES AS A RESULT OF THE EXISTENCE OF SUCH HAZARDOUS SUBSTANCES OR RADON OR
FAILURE TO COMPLY WITH SUCH ENVIRONMENTAL LAWS OR REGULATIONS, AND (IX) FOR
FRAUD, MATERIAL MISREPRESENTATION OR FAILURE TO DISCLOSE A MATERIAL FACT, ANY
UNTRUE STATEMENT OF A MATERIAL FACT OR OMISSION TO STATE A MATERIAL FACT IN THE
WRITTEN MATERIALS AND/OR INFORMATION PROVIDED TO LENDER OR ANY OF ITS AFFILIATES
BY OR ON BEHALF OF BORROWER OR ANY OF ITS AFFILIATES, PRINCIPALS, OFFICERS,
GENERAL PARTNERS OR MEMBERS, ANY GUARANTOR, ANY INDEMNITOR OR ANY AGENT,
EMPLOYEE OR OTHER PERSON AUTHORIZED OR APPARENTLY AUTHORIZED TO MAKE STATEMENTS,
REPRESENTATIONS OR DISCLOSURES ON BEHALF OF BORROWER, ANY AFFILIATE, PRINCIPAL,
OFFICER, GENERAL

9

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

PARTNER OR MEMBER OF BORROWER, ANY GUARANTOR OR ANY INDEMNITOR, TO THE FULL
EXTENT OF ANY LOSSES, DAMAGES AND EXPENSES OF LENDER AND/OR ANY OF ITS
AFFILIATES ON ACCOUNT THEREOF. REFERENCES HEREIN TO PARTICULAR SECTIONS OF THE
LOAN DOCUMENTS SHALL BE DEEMED REFERENCES TO SUCH SECTIONS AS AFFECTED BY OTHER
PROVISIONS OF THE LOAN DOCUMENTS RELATING THERETO. NOTHING CONTAINED IN THIS
SECTION SHALL (1) BE DEEMED TO BE A RELEASE OR IMPAIRMENT OF THE INDEBTEDNESS
EVIDENCED BY THIS NOTE OR THE OTHER OBLIGATIONS OF BORROWER UNDER THE LOAN
DOCUMENTS OR THE LIEN OF THE LOAN DOCUMENTS UPON THE PROPERTY, OR (2) PRECLUDE
LENDER FROM FORECLOSING THE LOAN DOCUMENTS IN CASE OF ANY DEFAULT OR FROM
ENFORCING ANY OF THE OTHER RIGHTS OF LENDER EXCEPT AS STATED IN THIS SECTION, OR
(3) LIMIT OR IMPAIR IN ANY WAY WHATSOEVER (A) THE INDEMNITY AND GUARANTY
AGREEMENT (THE “INDEMNITY AGREEMENT”) OR (B) THE ENVIRONMENTAL INDEMNITY
AGREEMENT (THE “ENVIRONMENTAL INDEMNITY AGREEMENT”), EACH OF EVEN DATE HEREWITH
EXECUTED AND DELIVERED IN CONNECTION WITH THE INDEBTEDNESS EVIDENCED BY THIS
NOTE OR RELEASE, RELIEVE, REDUCE, WAIVE OR IMPAIR IN ANY WAY WHATSOEVER, ANY
OBLIGATION OF ANY PARTY TO THE INDEMNITY AGREEMENT OR THE ENVIRONMENTAL
INDEMNITY AGREEMENT.

Notwithstanding the foregoing, the agreement of Lender not to pursue recourse
liability as set forth in this Section 2.6 SHALL BECOME NULL AND VOID and shall
be of no further force and effect in the event of (i) a default by Borrower,
Indemnitor (as defined in the Security Instrument) or any general partner,
manager or managing member of Borrower of any of the covenants set forth in
Section 2.9 of the Security Instrument or a default by Borrower, Indemnitor or
any general partner, manager or managing member of Borrower which is a
Single-Purpose Entity (as defined in the Security Instrument) (if any) of the
covenants set forth in Section 2.29 of the Security Instrument, or (ii) if the
Property or any part thereof shall become an asset in (A) a voluntary bankruptcy
or insolvency proceeding of Borrower or Indemnitor, or (B) an involuntary
bankruptcy or insolvency proceeding of Borrower or Indemnitor in which the
Borrower or the Indemnitor colludes or any of their affiliates with creditors in
such bankruptcy or insolvency proceeding and which is not dismissed within sixty
(60) days of filing or (C) Borrower or Indemnitor or any of their affiliates
intentionally interferes in any material respect, directly or indirectly, with
Lender’s exercise and/or realization of Lender’s remedies under and as set forth
in the Loan Documents other than by the assertion of a good faith defense based
upon a failure by Lender to observe the provisions of this Section 2.6 of this
Note.

Notwithstanding anything to the contrary in this Note, the Security Instrument
or any of the other Loan Documents, Lender shall not be deemed to have waived
any right which Lender may have under Section 506(a), 506(b), 1111(b) or any
other provisions of the U.S. Bankruptcy Code to file a claim for the full amount
of the indebtedness evidenced hereby or secured by the Security Instrument or
any of the other Loan Documents or to require that all collateral shall continue
to secure all of the indebtedness owing to Lender in accordance with this Note,
the Security Instrument and the other Loan Documents.

ARTICLE III

GENERAL CONDITIONS

SECTION 3.1             NO WAIVER; AMENDMENT. NO FAILURE TO ACCELERATE THE
INDEBTEDNESS EVIDENCED HEREBY BY REASON OF DEFAULT HEREUNDER, ACCEPTANCE OF A
PARTIAL OR PAST DUE PAYMENT, OR INDULGENCES GRANTED FROM TIME TO TIME SHALL BE
CONSTRUED (I) AS A NOVATION OF THIS NOTE OR AS A

10

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

REINSTATEMENT OF THE INDEBTEDNESS EVIDENCED HEREBY OR AS A WAIVER OF SUCH RIGHT
OF ACCELERATION OR OF THE RIGHT OF LENDER THEREAFTER TO INSIST UPON STRICT
COMPLIANCE WITH THE TERMS OF THIS NOTE, OR (II) TO PREVENT THE EXERCISE OF SUCH
RIGHT OF ACCELERATION OR ANY OTHER RIGHT GRANTED HEREUNDER OR BY ANY APPLICABLE
LAWS; AND BORROWER HEREBY EXPRESSLY WAIVES THE BENEFIT OF ANY STATUTE OR RULE OF
LAW OR EQUITY NOW PROVIDED, OR WHICH MAY HEREAFTER BE PROVIDED, WHICH WOULD
PRODUCE A RESULT CONTRARY TO OR IN CONFLICT WITH THE FOREGOING. NO EXTENSION OF
THE TIME FOR THE PAYMENT OF THIS NOTE OR ANY INSTALLMENT DUE HEREUNDER MADE BY
AGREEMENT WITH ANY PERSON NOW OR HEREAFTER LIABLE FOR THE PAYMENT OF THIS NOTE
SHALL OPERATE TO RELEASE, DISCHARGE, MODIFY, CHANGE OR AFFECT THE ORIGINAL
LIABILITY OF BORROWER UNDER THIS NOTE, EITHER IN WHOLE OR IN PART, UNLESS LENDER
AGREES OTHERWISE IN WRITING. THIS NOTE MAY NOT BE CHANGED ORALLY, BUT ONLY BY AN
AGREEMENT IN WRITING SIGNED BY THE PARTY AGAINST WHOM ENFORCEMENT OF ANY WAIVER,
CHANGE, MODIFICATION OR DISCHARGE IS SOUGHT.

SECTION 3.2             WAIVERS. PRESENTMENT FOR PAYMENT, DEMAND, PROTEST AND
NOTICE OF DEMAND, PROTEST AND NONPAYMENT AND ALL OTHER NOTICES ARE HEREBY WAIVED
BY BORROWER. BORROWER HEREBY FURTHER WAIVES AND RENOUNCES, TO THE FULLEST EXTENT
PERMITTED BY LAW, ALL RIGHTS TO THE BENEFITS OF ANY MORATORIUM, REINSTATEMENT,
MARSHALING, FORBEARANCE, VALUATION, STAY, EXTENSION, REDEMPTION, APPRAISEMENT,
EXEMPTION AND HOMESTEAD NOW OR HEREAFTER PROVIDED BY THE CONSTITUTION AND LAWS
OF THE UNITED STATES OF AMERICA AND OF EACH STATE THEREOF, BOTH AS TO ITSELF AND
IN AND TO ALL OF ITS PROPERTY, REAL AND PERSONAL, AGAINST THE ENFORCEMENT AND
COLLECTION OF THE OBLIGATIONS EVIDENCED BY THIS NOTE OR THE OTHER LOAN
DOCUMENTS.

SECTION 3.3             LIMIT OF VALIDITY. THE PROVISIONS OF THIS NOTE AND OF
ALL AGREEMENTS BETWEEN BORROWER AND LENDER, WHETHER NOW EXISTING OR HEREAFTER
ARISING AND WHETHER WRITTEN OR ORAL, INCLUDING, BUT NOT LIMITED TO, THE LOAN
DOCUMENTS, ARE HEREBY EXPRESSLY LIMITED SO THAT IN NO CONTINGENCY OR EVENT
WHATSOEVER, WHETHER BY REASON OF DEMAND OR ACCELERATION OF THE MATURITY OF THIS
NOTE OR OTHERWISE, SHALL THE AMOUNT CONTRACTED FOR, CHARGED, TAKEN, RESERVED,
PAID OR AGREED TO BE PAID (“INTEREST”) TO LENDER FOR THE USE, FORBEARANCE OR
DETENTION OF THE MONEY LOANED UNDER THIS NOTE EXCEED THE MAXIMUM AMOUNT
PERMISSIBLE UNDER APPLICABLE LAW. IF, FROM ANY CIRCUMSTANCE WHATSOEVER,
PERFORMANCE OR FULFILLMENT OF ANY PROVISION HEREOF OR OF ANY AGREEMENT BETWEEN
BORROWER AND LENDER SHALL, AT THE TIME PERFORMANCE OR FULFILLMENT OF SUCH
PROVISION SHALL BE DUE, EXCEED THE LIMIT FOR INTEREST PRESCRIBED BY LAW OR
OTHERWISE TRANSCEND THE LIMIT OF VALIDITY PRESCRIBED BY APPLICABLE LAW, THEN,
IPSO FACTO, THE OBLIGATION TO BE PERFORMED OR FULFILLED SHALL BE REDUCED TO SUCH
LIMIT, AND IF, FROM ANY CIRCUMSTANCE WHATSOEVER, LENDER SHALL EVER RECEIVE
ANYTHING OF VALUE DEEMED INTEREST BY APPLICABLE LAW IN EXCESS OF THE MAXIMUM
LAWFUL AMOUNT, AN AMOUNT EQUAL TO ANY EXCESSIVE INTEREST SHALL BE APPLIED TO THE
REDUCTION OF THE PRINCIPAL BALANCE OWING UNDER THIS NOTE IN THE INVERSE ORDER OF
ITS MATURITY (WHETHER OR NOT THEN DUE) OR, AT THE OPTION OF LENDER, BE PAID OVER
TO BORROWER, AND NOT TO THE PAYMENT OF INTEREST. ALL INTEREST (INCLUDING ANY
AMOUNTS OR PAYMENTS JUDICIALLY OR OTHERWISE UNDER THE LAW DEEMED TO BE INTEREST)
CONTRACTED FOR, CHARGED, TAKEN, RESERVED, PAID OR AGREED TO BE PAID TO LENDER
SHALL, TO THE EXTENT PERMITTED BY APPLICABLE LAW, BE AMORTIZED, PRORATED,
ALLOCATED AND SPREAD THROUGHOUT THE FULL TERM OF THIS NOTE, INCLUDING ANY
EXTENSIONS AND RENEWALS HEREOF UNTIL PAYMENT IN FULL OF THE PRINCIPAL BALANCE OF
THIS NOTE SO THAT THE INTEREST THEREON FOR SUCH FULL TERM WILL NOT EXCEED AT ANY
TIME THE MAXIMUM AMOUNT PERMITTED BY APPLICABLE LAW. TO THE EXTENT UNITED STATES
FEDERAL LAW PERMITS A GREATER AMOUNT OF INTEREST THAN IS PERMITTED UNDER THE LAW
OF THE STATE IN WHICH THE PROPERTY IS LOCATED, LENDER WILL RELY ON UNITED STATES
FEDERAL LAW FOR THE PURPOSE OF DETERMINING THE MAXIMUM AMOUNT PERMITTED

11

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

BY APPLICABLE LAW. ADDITIONALLY, TO THE EXTENT PERMITTED BY APPLICABLE LAW NOW
OR HEREAFTER IN EFFECT, LENDER MAY, AT ITS OPTION AND FROM TIME TO TIME,
IMPLEMENT ANY OTHER METHOD OF COMPUTING THE MAXIMUM LAWFUL RATE UNDER THE LAW OF
THE STATE IN WHICH THE PROPERTY IS LOCATED OR UNDER OTHER APPLICABLE LAW BY
GIVING NOTICE, IF REQUIRED, TO BORROWER AS PROVIDED BY APPLICABLE LAW NOW OR
HEREAFTER IN EFFECT. THIS SECTION 3.3 WILL CONTROL ALL AGREEMENTS BETWEEN
BORROWER AND LENDER.

SECTION 3.4             USE OF FUNDS. BORROWER HEREBY WARRANTS, REPRESENTS AND
COVENANTS THAT NO FUNDS DISBURSED HEREUNDER SHALL BE USED FOR PERSONAL, FAMILY
OR HOUSEHOLD PURPOSES.

SECTION 3.5             UNCONDITIONAL PAYMENT. BORROWER IS AND SHALL BE
OBLIGATED TO PAY PRINCIPAL, INTEREST AND ANY AND ALL OTHER AMOUNTS WHICH BECOME
PAYABLE HEREUNDER OR UNDER THE OTHER LOAN DOCUMENTS ABSOLUTELY AND
UNCONDITIONALLY AND WITHOUT ANY ABATEMENT, POSTPONEMENT, DIMINUTION OR DEDUCTION
AND WITHOUT ANY REDUCTION FOR COUNTERCLAIM OR SETOFF. IN THE EVENT THAT AT ANY
TIME ANY PAYMENT RECEIVED BY LENDER HEREUNDER SHALL BE DEEMED BY A COURT OF
COMPETENT JURISDICTION TO HAVE BEEN A VOIDABLE PREFERENCE OR FRAUDULENT
CONVEYANCE UNDER ANY BANKRUPTCY, INSOLVENCY OR OTHER DEBTOR RELIEF LAW, THEN THE
OBLIGATION TO MAKE SUCH PAYMENT SHALL SURVIVE ANY CANCELLATION OR SATISFACTION
OF THIS NOTE OR RETURN THEREOF TO BORROWER AND SHALL NOT BE DISCHARGED OR
SATISFIED WITH ANY PRIOR PAYMENT THEREOF OR CANCELLATION OF THIS NOTE, BUT SHALL
REMAIN A VALID AND BINDING OBLIGATION ENFORCEABLE IN ACCORDANCE WITH THE TERMS
AND PROVISIONS HEREOF, AND SUCH PAYMENT SHALL BE IMMEDIATELY DUE AND PAYABLE
UPON DEMAND.

SECTION 3.6             GOVERNING LAW. THIS NOTE SHALL BE INTERPRETED, CONSTRUED
AND ENFORCED ACCORDING TO THE LAWS OF THE STATE IN WHICH THE PROPERTY IS
LOCATED.

SECTION 3.7             WAIVER OF JURY TRIAL. BORROWER, TO THE FULL EXTENT
PERMITTED BY LAW, HEREBY KNOWINGLY, INTENTIONALLY AND VOLUNTARILY, WITH AND UPON
THE ADVICE OF COMPETENT COUNSEL, WAIVES, RELINQUISHES AND FOREVER FORGOES THE
RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING BASED UPON, ARISING OUT OF,
OR IN ANY WAY RELATING TO THE DEBT EVIDENCED BY THIS NOTE OR ANY CONDUCT, ACT OR
OMISSION OF LENDER OR BORROWER, OR ANY OF THEIR RESPECTIVE DIRECTORS, OFFICERS,
PARTNERS, MEMBERS, EMPLOYEES, AGENTS OR ATTORNEYS, OR ANY OTHER PERSONS
AFFILIATED WITH LENDER OR BORROWER, IN EACH OF THE FOREGOING CASES, WHETHER
SOUNDING IN CONTRACT, TORT OR OTHERWISE.

ARTICLE IV

MISCELLANEOUS PROVISIONS

SECTION 4.1             SUCCESSORS AND ASSIGNS; JOINT AND SEVERAL;
INTERPRETATION. THE TERMS AND PROVISIONS HEREOF SHALL BE BINDING UPON AND INURE
TO THE BENEFIT OF BORROWER AND LENDER AND THEIR RESPECTIVE HEIRS, EXECUTORS,
LEGAL REPRESENTATIVES, SUCCESSORS, SUCCESSORS IN TITLE AND ASSIGNS, WHETHER BY
VOLUNTARY ACTION OF THE PARTIES OR BY OPERATION OF LAW. AS USED HEREIN,

12

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

THE TERMS “BORROWER” AND “LENDER” SHALL BE DEEMED TO INCLUDE THEIR RESPECTIVE
HEIRS, EXECUTORS, LEGAL REPRESENTATIVES, SUCCESSORS, SUCCESSORS IN TITLE AND
ASSIGNS, WHETHER BY VOLUNTARY ACTION OF THE PARTIES OR BY OPERATION OF LAW. IF
BORROWER CONSISTS OF MORE THAN ONE PERSON OR ENTITY, EACH SHALL BE JOINTLY AND
SEVERALLY LIABLE TO PERFORM THE OBLIGATIONS OF BORROWER UNDER THIS NOTE. ALL
PERSONAL PRONOUNS USED HEREIN, WHETHER USED IN THE MASCULINE, FEMININE OR NEUTER
GENDER, SHALL INCLUDE ALL OTHER GENDERS; THE SINGULAR SHALL INCLUDE THE PLURAL
AND VICE VERSA. TITLES OF ARTICLES AND SECTIONS ARE FOR CONVENIENCE ONLY AND IN
NO WAY DEFINE, LIMIT, AMPLIFY OR DESCRIBE THE SCOPE OR INTENT OF ANY PROVISIONS
HEREOF. TIME IS OF THE ESSENCE WITH RESPECT TO ALL PROVISIONS OF THIS NOTE. THIS
NOTE AND THE OTHER LOAN DOCUMENTS CONTAIN THE ENTIRE AGREEMENTS BETWEEN THE
PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF AND THEREOF AND ALL PRIOR
AGREEMENTS RELATIVE HERETO AND THERETO WHICH ARE NOT CONTAINED HEREIN OR THEREIN
ARE TERMINATED.

SECTION 4.2             TAXPAYER IDENTIFICATION. BORROWER’S TAX IDENTIFICATION
NUMBER IS 01-0817668.

[THE BALANCE OF THIS PAGE IS INTENTIONALLY LEFT BLANK]

13

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

IN WITNESS WHEREOF, Borrower has executed this Note as of the date first written
above.

 

 

BORROWER:

 

 

51 CHUBB SPE LLC,

 

 

a Delaware limited liability company

 

 

By:

/s/ Mitchell E. Hersh

 

 

 

 

Name: Mitchell E. Hersh

 

 

 

Title: President and Chief Executive Officer

STATE OF New Jersey

 

 

 

 

SS:

 

 

COUNTY OF Union

 

 

 

 

BE IT REMEMBERED that on the 8th day of May, 2006, Mitchell E. Hersh personally
came before me, and this person acknowledged under oath, to my satisfaction,
that he is the President and Chief Executive Officer of 51 CHUBB SPE LLC, a
Delaware limited liability company, the entity named in this document, and this
document was signed and delivered by the entity as its voluntary act duly
authorized by a proper resolution of the limited liability company.

 

/s/ Beverly E. Sturr

 

 

Beverly E. Sturr

 

Notary Public of New Jersey

 

My Commission expires on March 30, 2010

 

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