exv10w72






Exhibit 10.72




STATE OF VIRGINIA




CITY OF WAYNESBORO



This instrument was prepared by:




Monique Olivier, Esq.

Pepler Mastromonaco LLP

100 First Street, 25th Floor

San Francisco, CA 94105




Recording requested by

and when recorded return to:




WELLS FARGO BANK, N.A.

Commercial Mortgage Origination

5938 Priestly Drive, Suite 200

Carlsbad, California 92008




	 	 	 	 	 	 	 
	Attention:

	 	CMO Loan Admin.
	 	 
	Loan No.:

	 	02-62113748	 	 
	Unit No.:

	 	568	 	 	 
	Tax Parcel No.:

	 	50-(3)-2	 	 






 


DEED OF TRUST,

ABSOLUTE ASSIGNMENT OF RENTS AND LEASES

AND

SECURITY AGREEMENT

(AND FIXTURE FILING)



This DEED OF TRUST, ABSOLUTE ASSIGNMENT OF RENTS AND LEASES AND SECURITY AGREEMENT (AND FIXTURE
FILING) (this “Deed of Trust”), dated as of August 31, 2009 (the “Effective Date”),
is executed by COLE CB WAYNESBORO VA, LLC, a Delaware limited liability company
(“Grantor”), with an office at c/o Cole REIT III Operating Partnership, LP, 2555 E.
Camelback Road, Suite 400, Phoenix, Arizona 85016, grantor for indexing purposes, in favor of
ALEXANDER TITLE AGENCY, INCORPORATED, a Virginia corporation, as Trustee (“Trustee”),
grantee for indexing purposes ,whose mailing address is 5875 Trinity Parkway Suite 210,
Centreville, Virginia 20120, for the benefit of WELLS FARGO BANK, NATIONAL ASSOCIATION
(“Lender”), with a mailing address of 5938 Priestly Drive, Suite 200, Carlsbad, California
92008.




DEED OF TRUST (VIRGINIA)

Wells Fargo/Cole Properties/Cracker Barrel

Loan No. 02-62113748/Store No. 568




 









 





RECITALS:





	A.	 	Grantor, as Borrower, proposes to borrow from Lender, and Lender proposes to lend to Grantor,
the total principal sum of ONE MILLION FOUR HUNDRED TWENTY THOUSAND AND 00/100THS DOLLARS
($1,420,000.00) (the “Loan”). The Loan is evidenced by that certain Secured
Promissory Note of even date herewith, in the principal amount of the Loan, executed by
Grantor to Lender (the “Note”).






	B.	 	The loan documents include this Deed of Trust, the Note and the other documents described in
the Note as Loan Documents (“Loan Documents”).





ARTICLE 1 DEED OF TRUST





	1.1.	 	GRANT. For the purposes of and upon the terms and conditions of this Deed of Trust,
Grantor hereby has bargained, sold, given, granted and conveyed and does by these presents
bargain, sell, give, grant and convey to Trustee, his heirs, successors and assigns, in trust,
WITH POWER OF SALE for the benefit of Lender, with all privileges and appurtenances thereto
belonging, to Lender, his heirs, successors and assigns, forever upon the trusts, terms and
conditions and for the uses hereinafter set forth, all estate, right, title and interest which
Grantor now has or may hereafter acquire in, to, under, or derived from any or all of the
following: (a) that real property (“Land”) located in county of Augusta, Virginia, and
more particularly described on Exhibit A attached hereto and incorporated herein by
this reference; (b) all buildings, improvements and fixtures now or hereafter located on the
Land; and (c) all additions, accretions, rents, issues, profits, royalties, appurtenances,
easements, water, water rights, water stock, minerals, oil rights, gas rights, air rights and
other rights now or hereafter appurtenant or related to the Land. All of the foregoing
property is hereinafter collectively defined as the “Property.” The listing of
specific rights or property shall not be interpreted as a limitation of general terms.
	 
	 	 	TO HAVE AND TO HOLD the Property and all the estate, right, title and interest in law and in
equity, of Grantor in and to the Property, unto Trustee, its successors and assigns in fee
simple forever, upon the trusts, terms and conditions, and for the uses hereinafter set
forth.





ARTICLE 2 OBLIGATIONS SECURED





	2.1.	 	OBLIGATIONS SECURED. Grantor makes the foregoing grant and assignment and those set
forth in Articles 3 and 4 hereof and elsewhere herein for the purpose of securing the
following obligations (“Secured Obligations”):






	 	a.	 	Full and punctual payment to Lender of all sums at any time owing under the
Note;
	 
	 	b.	 	Payment and performance of all covenants and obligations of Grantor under this
Deed of Trust including, without limitation, indemnification obligations and advances
made to protect the Property;
	 
	 	c.	 	Payment and performance of all additional covenants and obligations of Grantor
under the Loan Documents;





DEED OF TRUST (VIRGINIA)

Wells Fargo/Cole Properties/Cracker Barrel

Loan No. 02-62113748/Store No. 568




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	 	d.	 	Payment and performance of all future advances and other obligations that the
then record owner of all or part of the Property may agree to pay and/or perform
(whether as principal, surety or guarantor) for the benefit of Lender, when the
obligation is evidenced by a writing which recites that it is secured by this Deed of
Trust;
	 
	 	e.	 	Payment and performance under any swap, derivative, foreign exchange or hedge
transaction or arrangement or similar transaction or arrangement howsoever described or
defined at any time entered into between Grantor and Lender in connection with the Note
(“Swap Agreement”);
	 
	 	f.	 	All interest and charges on all obligations secured hereby including, without
limitation, prepayment charges, late charges and loan fees;
	 
	 	g.	 	All modifications, extensions and renewals of any of the obligations secured
hereby, however evidenced, including, without limitation: (i) modifications of the
required principal payment dates or interest payment dates or both, as the case may be,
deferring or accelerating payment dates wholly or partly; and (ii) modifications,
extensions or renewals at a different rate of interest whether or not any such
modification, extension or renewal is evidenced by a new or additional promissory note
or notes; and
	 
	 	h.	 	Payment and performance of any other obligations which are defined as
“Secured Obligations” in the Note. The rate of interest on one or more Secured
Obligations may vary from time to time.






	2.2.	 	OBLIGATIONS. The term “obligations” is used herein in its broadest and most
comprehensive sense and shall be deemed to include, without limitation, all interest and
charges, prepayment charges, late charges and loan fees at any time accruing or assessed on
any of the Secured Obligations pursuant to the terms of the Loan Documents.
	 
	2.3.	 	INCORPORATION. All terms and conditions of the documents which evidence any of the
Secured Obligations are incorporated herein by this reference. All persons who may have or
acquire an interest in the Property shall be deemed to have notice of the terms of the Secured
Obligations and to have notice that the rate of interest on one or more Secured Obligation may
vary from time to time.
	 
	2.4.	 	PROTECTIVE ADVANCES. During the continuance of a Default, Lender shall have the
right, but not the obligation, to make protective advances with respect to the Property for
the payment of taxes, assessments, insurance premiums or costs incurred for the protection of
the Property, and such protective advances, together with interest thereon at the Default Rate
from the date of each such advance until it is repaid in full, shall be secured by this Deed
of Trust to the fullest extent and with the highest priority contemplated by applicable law.
	 
	2.5.	 	MATURITY DATE. The Maturity Date of the Note is August 29, 2012.
	 
	2.6.	 	FIXTURE FILING. As to all of the above-described personal property which is or which
hereafter becomes a “fixture” under applicable law, this Deed of Trust constitutes a fixture
filing under the Commonwealth of Virginia Uniform Commercial Code, as amended or recodified
from





DEED OF TRUST (VIRGINIA)

Wells Fargo/Cole Properties/Cracker Barrel

Loan No. 02-62113748/Store No. 568




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	 	 	time to time (the “UCC”). This Deed of Trust shall also be
effective as a financing statement covering minerals or the like
(including oil and gas) and accounts subject to Subsection (5)
of Section 8.9-103 of the UCC, and similar provisions (if any)
of the Uniform Commercial Code as enacted in any other state
where the Property is situated which will be financed at the
wellhead or minehead of the wells or mines located on the
Property and is to be filed for record in the real estate
records of each county where any part of the Property is
situated. This Deed of Trust shall also be effective as a
financing statement covering any other property and may be filed
in any other appropriate filing or recording office. A carbon,
photographic or other reproduction of this Deed of Trust or of
any financing statement relating to this Deed of Trust shall be
sufficient as a financing statement for any of the purposes
referred to in this Section 2.6.





ARTICLE 3 ABSOLUTE ASSIGNMENT OF RENTS AND LEASES





	3.1.	 	ASSIGNMENT. Grantor absolutely and irrevocably assigns to Lender all of Grantor’s
right, title and interest in, to and under: (a) all present and future leases of the Property
or any portion thereof (including without limitation all usufructs and estates in land), all
licenses and agreements relating to the management, leasing or operation of the Property or
any portion thereof, and all other agreements of any kind relating to the use or occupancy of
the Property or any portion thereof, whether such leases, licenses and agreements are now
existing or entered into after the date hereof, including, without limitation, that certain
Lease Agreement dated as of June 30, 2009, between Grantor, as landlord and CBOCS, INC., a
Tennessee corporation, as tenant (the “Existing Tenant”) covering the Property (as
amended, the “Existing Lease”); all such leases, licenses and agreements to which
Grantor is a party, including, without limitation, the Existing Lease, as same have been or
may be amended from time to time, are hereinafter collectively referred to as the
“Leases” and, individually, as a “Lease”) and (b) all rents, issues, deposits
and profits of the Property, including, without limitation, all amounts payable and all rights
and benefits accruing to Grantor under the Leases (“Payments”). The term
“Leases” shall also include all guarantees of and security for the Tenants’
performance thereunder, and all amendments, extensions, renewals or modifications thereto
which are permitted hereunder. The terms “Tenant” and “Tenants” shall refer
to any and all current and future tenants, including, without limitation, the Existing Tenant,
under any and all Leases affecting the Property. This is a present and absolute assignment,
not an assignment for security purposes only, and Lender’s right to the Leases and Payments is
not contingent upon, and may be exercised without possession of, the Property.






	3.2.	 	GRANT OF LICENSE. Lender confers upon Grantor a revocable license
(“License”) to collect and retain the Payments as they become due and payable, until
the occurrence of a Default (as hereinafter defined). Upon a Default, the License shall be
automatically revoked and Lender may collect and apply the Payments pursuant to the terms
hereof without notice and without taking possession of the Property. All Payments thereafter
collected by Grantor shall be held by Grantor as trustee under a constructive trust for the
benefit of Lender. Grantor hereby irrevocably authorizes and directs the Tenants under the
Leases to rely upon and comply with any notice or demand by Lender for the payment to Lender
of any rental or other sums which may at any time become due under the Leases, or for the
performance of any of the Tenants’ undertakings under the Leases, and the Tenants shall have
no right or duty to inquire as to whether any Default has actually occurred or is then
existing. Grantor hereby relieves the Tenants from any liability to





DEED OF TRUST (VIRGINIA)

Wells Fargo/Cole Properties/Cracker Barrel

Loan No. 02-62113748/Store No. 568




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	 	 	Grantor by reason of relying upon and complying with any such notice or demand by Lender.
Lender may apply, in its sole discretion, any Payments so collected by Lender against any
Secured Obligation or any other obligation of Grantor or any other person or entity, under
any document or instrument related to or executed in connection with the Loan Documents,
whether existing on the date hereof or hereafter arising. Collection of any Payments by
Lender shall not cure or waive any Default or notice of Default or invalidate any acts done
pursuant to such notice. If and when no Default exists, the License shall be deemed to be
re-conferred upon Grantor by Lender, without any further act or deed, until the occurrence
of another Default.






	3.3.	 	EFFECT OF ASSIGNMENT. The foregoing irrevocable assignment shall not cause Lender to
be: (a) a mortgagee in possession; (b) responsible or liable for the control, care, management
or repair of the Property or for performing any of the terms, agreements, undertakings,
obligations, representations, warranties, covenants and conditions of the Leases; (c)
responsible or liable for any waste committed on the Property by the tenants under any of the
Leases or by any other parties; for any dangerous or defective condition of the Property; or
for any negligence in the management, upkeep, repair or control of the Property resulting in
loss or injury or death to any tenant, licensee, employee, invitee or other person; or (d)
responsible for or impose upon Lender any duty to produce rents or profits. Lender shall not
directly or indirectly be liable to Grantor or any other person as a consequence of: (i) the
exercise or failure to exercise any of the rights, remedies or powers granted to Lender
hereunder; or (ii) the failure or refusal of Lender to perform or discharge any obligation,
duty or liability of Grantor arising under the Leases.






	3.4.	 	COVENANTS — LEASES.






	 	a.	 	Affirmative Covenants. Grantor shall, at Grantor’s sole cost and
expense:






	 	(i)	 	perform all obligations of the landlord under the Leases and
use reasonable efforts to enforce performance by the Tenants of all obligations
of the Tenants under the Leases;
	 
	 	(ii)	 	use reasonable efforts to keep the Property leased at all times
to Tenants which Grantor reasonably and in good faith believes are creditworthy
at rents not less than the fair market rental value (including, but not limited
to, free or discounted rents to the extent the market so requires);
	 
	 	(iii)	 	promptly upon Lender’s request, deliver to Lender a copy of
each requested Lease and all amendments thereto and waivers thereof; and
	 
	 	(iv)	 	promptly upon Lender’s request, execute and record any
additional assignments of landlord’s interest under any Lease to Lender and
specific subordinations of any Lease to this Deed of Trust, in form and
substance satisfactory to Lender.






	 	b.	 	Negative Covenants. Unless consented to in writing by Lender (in its
sole and absolute discretion) or otherwise permitted under any other provision of the
Loan Documents or under any Lease, Grantor shall not:





DEED OF TRUST (VIRGINIA)

Wells Fargo/Cole Properties/Cracker Barrel

Loan No. 02-62113748/Store No. 568




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	 	(i)	 	enter into any Lease which (aa) is not on commercially
reasonable terms and conditions similar to those found in similarly situated
commercial or retail properties, as applicable; (bb) does not contain
subordination, attornment and other grantee protective provisions, including a
provision requiring the Tenant to execute and deliver to the landlord an
estoppel certificate in form and substance reasonably satisfactory to the
landlord promptly upon the landlord’s request; (cc) does not contain
environmental compliance and reporting provisions reasonably satisfactory to
Lender and its counsel; or (dd) allows the Tenant to assign or sublet the
premises, except in accordance with and subject to the terms set forth in such
Lease;
	 
	 	(ii)	 	grant any Tenant under any of the Leases any option, right of
first refusal or other right to purchase all or any portion of the Property
under any circumstances;
	 
	 	(iii)	 	grant any Tenant under any of the Leases any right to prepay
rent more than one (1) month in advance;
	 
	 	(iv)	 	except upon Lender’s request, execute any assignment of
landlord’s interest in any of the Leases; or
	 
	 	(v)	 	collect rent or other sums due under any of the Leases in
advance, other than to collect rent one (1) month in advance of the time when
it becomes due.
	 
	 	(vi)	 	reduce any rent or other sums due from the Tenant under any
Lease;
	 
	 	(vii)	 	terminate or modify or amend any Lease or any guaranty
executed by any guarantor in connection therewith;
	 
	 	(viii)	 	allow the Tenant to assign or sublet its Lease, except in accordance with and
subject to the terms of its Lease;
	 
	 	(ix)	 	release or discharge the Tenant or any guarantor under any
Lease from any material obligation thereunder; or
	 
	 	(x)	 	subordinate or agree to subordinate any Lease to any other deed
of trust, deed to secure debt or mortgage (other than this Deed of Trust) and
any other Deed of Trust (as such term is defined in the Loan Documents).






	 	 	 	Any such attempted action in violation of the provisions of this Section shall be
null and void.






	 	c.	 	Lease Default. Grantor shall, at Grantor’s sole cost and expense, give
Lender prompt written notice of any Lease Default (defined below). The term “Lease
Default” shall mean there shall exist (i) any “Event of Default” as defined in any
Lease, or (ii) any default under a Lease by Grantor after the expiration of any
applicable notice or cure period, in respect of a covenant, misrepresentation,
violation or other occurrence that





DEED OF TRUST (VIRGINIA)

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Loan No. 02-62113748/Store No. 568




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	 	 	 	Lender, in its reasonable discretion, determines to be a material covenant,
misrepresentation, violation or occurrence under such Lease.
	 
	 	d.	 	Approval of Existing Lease. It is understood that Grantor’s
execution and delivery of this Deed of Trust, together with Lender’s disbursement of
the proceeds of the Loan, shall constitute Lender’s written consent to the terms of the
Existing Lease, approval of the Tenant and an acknowledgment that the Existing Lease
complies with the provisions of this Section and the other provisions of this Deed of
Trust. As of the date of this Deed of Trust, the Property is subject to the Existing
Lease which has been approved by Lender and is the only Lease affecting the Property.






	3.5.	 	ESTOPPEL CERTIFICATES. Within thirty (30) days after request by Lender, but not more
than two (2) times in any twelve (12) month period, Grantor shall deliver to Lender and to any
party designated by Lender, estoppel certificates relating to the Leases executed by Grantor
and by Tenant, in form and substance as executed by Existing Tenant on or about the date of
this Deed of Trust; provided, however, if Tenant shall fail or refuse to so execute and
deliver any such estoppel certificate upon request, Grantor shall use reasonable efforts to
cause such Tenant to execute and deliver such estoppel certificate, but such Tenant’s
continued failure or refusal to do so, despite Grantor’s reasonable efforts, shall not
constitute a default by Grantor under this Section.
	 
	3.6.	 	RIGHT OF SUBORDINATION. Lender may at any time and from time to time by specific
written instrument intended for the purpose unilaterally subordinate the lien of this Deed of
Trust to any Lease, without joinder or consent of, or notice to, Grantor, any Tenant or any
other person. Notice is hereby given to each Tenant under a Lease of such right to
subordinate. No subordination referred to in this Section shall constitute a subordination to
any lien or other encumbrance, whenever arising, or improve the right of any junior
lienholder. Nothing herein shall be construed as subordinating this Deed of Trust to any
Lease.





ARTICLE 4 SECURITY AGREEMENT





	4.1.	 	SECURITY INTEREST. Grantor grants and assigns to Lender a security interest to
secure payment and performance of all of the Secured Obligations, in Grantor’s right, title
and interest in and to all of the following described personal property in which Grantor now
or at any time hereafter has any interest (“Collateral”):
	 
	 	 	All goods, building and other materials, supplies, work in process, equipment, machinery,
fixtures, furniture, furnishings, signs and other personal property, wherever situated,
which are or are to be incorporated into, used in connection with or appropriated for use on
the Property; all rents, issues, deposits and profits of the Property (to the extent, if
any, they are not subject to the Absolute Assignment of Rents and Leases); all inventory,
accounts, cash receipts, deposit accounts, impounds, accounts receivable, contract rights,
general intangibles, software, chattel paper, instruments, documents, promissory notes,
drafts, letters of credit, letter of credit rights, supporting obligations, insurance
policies, insurance and condemnation awards and proceeds, any other rights to the payment of
money, trade names, trademarks and service marks arising from or related to the Property or
any business now or hereafter conducted thereon by Grantor; all permits, consents,
approvals, licenses, authorizations and other rights granted by, given by or





DEED OF TRUST (VIRGINIA)

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Loan No. 02-62113748/Store No. 568




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	 	 	obtained from, any governmental entity with respect to the ownership and use of the
Property; all deposits or other security now or hereafter made with or given to utility
companies by Grantor with respect to the Property; all advance payments of insurance
premiums made by Grantor with respect to the Property; all plans, drawings and
specifications relating to the Property; all loan funds held by Lender, whether or not
disbursed; all funds deposited with Lender pursuant to any Loan Document, all reserves,
deferred payments, deposits, accounts, refunds, cost savings and payments of any kind
related to the Property or any portion thereof, including, without limitation, all
“Impounds” as defined herein; together with all replacements and proceeds of, and additions
and accessions to, any of the foregoing, and all books, records and files relating to any of
the foregoing.
	 
	 	 	As to all of the above-described personal property, this Deed of Trust is acknowledged and
agreed to be a security agreement under the Virginia Uniform Commercial Code, as amended or
recodified from time to time (the “UCC”). For purposes of the foregoing (i) Grantor
is the “debtor” and its address is as set forth on Page 1 of this Deed of Trust,
(ii) the Lender is the “secured party” and its address is as set forth on Page 1 of
this Deed of Trust and (iii) the name of the record owner of the Property is Grantor.






	4.2.	 	COVENANTS. Grantor agrees: (a) to execute and deliver such documents as Lender deems
necessary to create, perfect and continue the security interests contemplated hereby; (b) not
to change its name, and as applicable, its chief executive offices, its principal residence or
the jurisdiction in which it is organized without giving Lender at least thirty (30) days’
prior written notice thereof; and (c) to cooperate with Lender in perfecting all security
interests granted herein and in obtaining such agreements from third parties as Lender deems
reasonably necessary, proper or convenient in connection with the preservation, perfection or
enforcement of any of Lender’s rights hereunder.
	 
	4.3.	 	RIGHTS OF GRANTEE. In addition to Lender’s rights as a “Secured Party” under the
UCC, Lender may, but shall not be obligated to, at any time without notice and at the expense
of Grantor: (a) give notice to any person of Lender’s rights hereunder and enforce such rights
at law or in equity; (b) insure, protect, defend and preserve the Collateral or any rights or
interests of Lender therein; and (c) inspect the Collateral (and during the term of any Lease,
subject to any specific restrictions or prohibitions under such Lease). Notwithstanding the
above, in no event shall Lender be deemed to have accepted any property other than cash in
satisfaction of any obligation of Grantor to Lender unless Lender shall make an express
written election of said remedy under the UCC or other applicable law.
	 
	4.4.	 	RIGHTS OF LENDER UPON DEFAULT. Upon the occurrence and continuation of a Default,
then in addition to all of Lender’s rights as a “Secured Party” under the UCC or otherwise at
law:






	 	a.	 	Disposition of Collateral. Lender may: (i) upon written notice,
require Grantor to assemble the Collateral and make it available to Lender at a place
designated by Lender; (ii) without prior notice, enter upon the Property (and during
the term of any Lease affecting the Property, subject to any specific restrictions or
prohibitions under any such lease) or other place where any of the Collateral may be
located and take possession of, collect, sell, lease, license and otherwise dispose of
the Collateral, and store the same at





DEED OF TRUST (VIRGINIA)

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	 	 	 	locations acceptable to Lender at Grantor’s expense; or (iii) sell, assign and
deliver the Collateral at any place or in any lawful manner and bid and become
purchaser at any such sales; and






	 	b.	 	Other Rights. Lender may, for the account of Grantor and at Grantor’s
expense: (i) operate, use, consume, sell, lease, license or otherwise dispose of the
Collateral as Lender deems appropriate for the purpose of performing any or all of the
Secured Obligations; (ii) enter into any agreement, compromise or settlement including
insurance claims, which Lender may deem desirable or proper with respect to the
Collateral; and (iii) endorse and deliver evidences of title for, and receive, enforce
and collect by legal action or otherwise, all indebtedness and obligations now or
hereafter owing to Grantor in connection with or on account of the Collateral.






	 	 	Grantor acknowledges and agrees that a disposition of the Collateral in accordance with
Lender’s rights and remedies as heretofore provided is a disposition thereof in a
commercially reasonable manner and that ten (10) days’ prior notice of such disposition is
commercially reasonable notice. Lender shall have no obligation to process or prepare the
Collateral for sale or other disposition. In disposing of the Collateral, Lender may
disclaim all warranties of title, possession, quiet enjoyment and the like. Any proceeds of
any sale or other disposition of the Collateral may be applied by Lender first to the
reasonable expenses incurred by Lender in connection therewith, including, without
limitations, reasonable attorneys’ fees and disbursements, and then to the payment of the
Secured Obligations, in such order of application as Lender may from time to time elect.
	 
	4.5.	 	POWER OF ATTORNEY. Grantor hereby irrevocably appoints Lender as Grantor’s
attorney-in-fact (such agency being coupled with an interest), and as such attorney-in-fact,
Lender may, without the obligation to do so, in Lender’s name or in the name of Grantor,
prepare, execute, file and record financing statements, continuation statements, applications
for registration and like papers necessary to create, perfect or preserve any of Lender’s
security interests and rights in or to the Collateral, and take any other action required of
Grantor; provided, however, that Lender as such attorney-in-fact shall be accountable only for
such funds as are actually received by Lender.





ARTICLE 5 REPRESENTATIONS AND WARRANTIES





	5.1.	 	REPRESENTATIONS AND WARRANTIES. Grantor represents and warrants to Lender that, to
Grantor’s current actual knowledge, the following statements are true and correct as of the
Effective Date:






	 	a.	 	Legal Status. Grantor is duly formed and validly existing and in good
standing under the laws of the state(s) in which Grantor is organized. Grantor is
qualified or licensed to do business in all jurisdictions in which such qualification
or licensing is required.
	 
	 	b.	 	Permits. Grantor possesses all permits, franchises and licenses and
all rights to all trademarks, trade names, patents and fictitious names, if any,
necessary to enable Grantor to conduct the business(es) in which Grantor is now engaged
in compliance with applicable law.





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	 	c.	 	Authorization and Validity. The execution and delivery of the Loan
Documents have been duly authorized and the Loan Documents constitute valid and binding
obligations of Grantor, enforceable in accordance with their respective terms, except
as such enforcement may be limited by bankruptcy, insolvency, moratorium or other laws
affecting the enforcement of creditors’ rights, or by the application of rules of
equity.
	 
	 	d.	 	Violations. The execution, delivery and performance by Grantor of each
of the Loan Documents does not violate any provision of any law or regulation, or
result in any breach or default under any contract, obligation, indenture or other
instrument to which Grantor is a party or by which Grantor is bound.
	 
	 	e.	 	Litigation. Except as otherwise disclosed in that certain Disclosure
Agreement Regarding Representations, Covenants and Warranties of even date herewith,
executed by Grantor for the benefit of Lender (the “Disclosure Agreement”),
there are no pending or threatened actions, claims, investigations, suits or
proceedings before any governmental authority, court or administrative agency which may
adversely affect the financial condition or operations of Grantor.
	 
	 	f.	 	Financial Statements. The Financial Statements (as such term is
defined in that certain Borrower’s Certification of even date herewith, executed by
Grantor in favor of Lender) of the sole member of Grantor and guarantor, Cole REIT III
Operating Partnership, LP, a Delaware limited partnership (“Guarantor”),
previously delivered by Grantor to Lender: (i) are materially complete and correct;
(ii) present fairly the financial condition of such party; and (iii) have been prepared
in accordance with generally accepted accounting principles (“GAAP”). Since
the date of such Financial Statements, there has been no material adverse change in
such financial condition, nor have any assets or properties reflected on such financial
statements been sold, transferred, assigned, mortgaged, pledged or encumbered, except
as disclosed in the Disclosure Agreement.
	 
	 	g.	 	Reports. All reports, documents, instruments and information delivered
by Grantor to Lender or otherwise prepared by, for or at the direction of Grantor and
delivered to Lender in connection with the Loan: (i) are correct and sufficiently
complete to give Lender accurate knowledge of their subject matter; and (ii) do not
contain any misrepresentation of a material fact or omission of a material fact which
omission makes the provided information misleading.
	 
	 	h.	 	Income Taxes. There are no pending assessments or adjustments of
Grantor’s income tax payable with respect to any year.
	 
	 	i.	 	Subordination. There is no agreement or instrument to which Grantor is
a party or by which Grantor is bound that would require the subordination in right of
payment of any of Grantor’s obligations under the Note to an obligation owed to another
party.
	 
	 	j.	 	Title. Grantor lawfully holds and possesses fee simple title to the
Property, without limitation on the right to encumber same. This Deed of Trust is a
first conveyance of title to the Property as security prior and superior to all other
liens and encumbrances on the Property except: (i) liens for real estate taxes and
assessments that are either not yet due





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	 	 	 	and payable or due, but not yet delinquent; (ii) senior exceptions previously
approved by Lender and shown in the title insurance policy insuring the lien of this
Deed of Trust upon the Property; and (iii) other matters, if any, as disclosed in
the Disclosure Agreement.
	 
	 	k.	 	Mechanics’ Liens. Except as disclosed in the Disclosure Agreement,
there are no mechanics’ or similar liens or claims which have been filed for work,
labor or material affecting the Property which are or may be prior to or equal to the
lien of this Deed of Trust upon the Property. Except as disclosed in the Disclosure
Agreement, there are no rights outstanding that under law could give rise to any liens
affecting the Property which are or may be prior to or equal to the lien of this Deed
of Trust upon the Property.
	 
	 	l.	 	 Encroachments. Except as shown in the survey for the Property issued
in connection with the closing of the Loan and previously delivered to Lender, none of
the buildings or other improvements which were included for the purpose of determining
the appraised value of the Property lies outside of the boundaries or building
restriction lines of the Property and no buildings or other improvements located on
adjoining properties encroach upon the Property.
	 
	 	m. 	 	Leases. The Existing Lease is in full force and effect and is
enforceable in accordance with its terms. No material breach or default by any party,
or event which would constitute a material breach or default by any party after notice
or the passage of time, or both, exists under the Existing Lease. None of the
landlord’s interests under any of the Leases, including, but not limited to, rents,
additional rents, charges, issues or profits, has been transferred or assigned other
than to Lender. No rent or other payment under the Existing Lease has been paid by the
Existing Tenant for more than one (1) month in advance.
	 
	 	n.	 	 Collateral. Grantor has good title to the existing Collateral, if any,
free and clear of all liens and encumbrances, except those, if any, disclosed in the
Disclosure Agreement. Grantor’s chief executive office (or principal residence, if
applicable) is located at the address shown on Page 1 of this Deed of Trust. Grantor
is an organization organized solely under the laws of the State of Delaware. All
organizational documents of Grantor delivered to Lender are complete and accurate in
every respect. Grantor’s legal name is exactly as shown on Page 1 of this Deed of
Trust.
	 
	 	o.	 	Condition of Property. Except as set forth in the Environmental
Reports (as such term is defined in the Disclosure Agreement), or the Property
Condition Reports (as such term is defined in the (Disclosure Agreement), or as
otherwise set forth in the Disclosure Agreement, the Property is in good condition and
repair and is free from any damage that would materially and adversely affect the value
of the Property as security for the Loan or the intended use of the Property.
	 
	 	p.	 	Hazardous Materials. Except as shown in the Environmental Reports, or
as otherwise set forth in the Disclosure Agreement, or as otherwise permitted in
Section 6.2.a. below, the Property is not and has not been a site for the use,
generation, manufacture, storage,





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	 	 	 	treatment, release, threatened release, discharge, disposal, transportation or
presence of Hazardous Materials (as hereinafter defined).
	 
	 	q.	 	Hazardous Materials Laws. Except as shown in the Environmental
Reports, the Property complies with all Hazardous Materials Laws (as hereinafter
defined), except for any noncompliance that would not materially and adversely affect
the value of the Property as security for the Loan or the intended use of the Property.
	 
	 	r.	 	Hazardous Materials Claims. Except as shown in the Environmental
Reports, there are no pending or threatened Hazardous Materials Claims (as hereinafter
defined) that would materially and adversely affect the value of the Property as
security for the Loan or the intended use of the Property.
	 
	 	s.	 	Wetlands. Except as shown in the Environmental Reports or on any
survey of the Property issued in connection with the closing of the Loan that has been
delivered to Lender, no part of the Property consists of or is classified as wetlands,
tidelands or swamp and overflow lands.
	 
	 	t.	 	Compliance With Laws. Except as reflected in the Environmental
Reports, or as otherwise set forth in the Disclosure Agreement, all federal, state and
local laws, rules and regulations applicable to the Property, including, without
limitation, all zoning and building requirements and all requirements of the Americans
With Disabilities Act of 1990, as amended from time to time (42 U.S.C. Section 12101 et
seq.) have been satisfied or complied with in all material respects and any non
compliance will not materially and adversely affect the value of the Property as
security for the Loan or the intended use of the Property.
	 
	 	u.	 	Property Taxes and Other Liabilities. All taxes, governmental
assessments, insurance premiums, water, sewer and municipal charges, and ground rents,
if any, which previously became due and owing in respect of the Property have been paid
or arrangements, acceptable to Lender, have been made for their payment
contemporaneously with the execution of this Deed of Trust.
	 
	 	v.	 	 Condemnation. There is no proceeding pending or overtly threatened for
the total or partial condemnation of the Property.
	 
	 	w.	 	Homestead. There is no homestead or other exemption available to
Grantor which would materially interfere with the right to sell the Property or the
right to foreclose this Deed of Trust.
	 
	 	x.	 	Solvency. None of the transactions contemplated by the Loan will be or
have been made with an actual intent to hinder, delay or defraud any present or future
creditors of Grantor, and Grantor, on the Effective Date, will have received fair and
reasonably equivalent value in good faith for the grant of the liens or security
interests effected by the Loan Documents. On the Effective Date, Grantor will be
solvent and will not be rendered insolvent by the transactions contemplated by the Loan
Documents. Grantor is able to pay its debts as they become due.





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	 	y.	 	Separate Tax Parcel(s). Except as may be set forth in the title
insurance policy issued to Lender with respect to the Property, and/or any endorsements
issued in connection therewith, the Property is assessed for real estate tax purposes
as one or more wholly independent tax parcels, separate from any other real property,
and no other real property is assessed and taxed together with the Property or any
portion thereof.
	 
	 	z.	 	Utilities; Water; Sewer. The Property is served by public or private
utilities (including water and sewer systems) required and adequate for the current or
contemplated use thereof.
	 
	 	aa.	 	ERISA Matters. Grantor is not an employee benefit plan as defined in
Section 3.(3) of the Employee Retirement Income Security Act of 1974, as amended
(“ERISA”), which is subject to Title I of ERISA, nor a plan as defined in
Section 4975(e)(1) of the Internal Revenue Code of 1986, as amended (each of the
foregoing hereinafter referred to individually and collectively as a “Plan”).
Grantor’s assets do not constitute “plan assets” of any plan within the meaning of
Department of Labor Regulation Section 2510.3-101. Grantor will not transfer or convey
the Property to a Plan or to a person or entity whose assets constitute such “plan
assets”, and Grantor will not be reconstituted as a Plan or as an entity whose assets
constitute “plan assets”. No Lease is with a Plan or an entity whose assets constitute
such “plan assets,” and Grantor will not enter into any Lease with a Plan or an entity
whose assets constitute such “plan assets.” With respect to the Loan, Grantor is
acting on Grantor’s own behalf and not on account of or for the benefit of any Plan.
	 
	 	bb.	 	Purpose of Borrowings; Margin Regulations; Investment Company Act.






	 	(i)	 	Grantor does not intend to use all or any portion of the
proceeds of the Loan to purchase or carry any securities, including, without
limitation, margin stock. None of the proceeds of the Loan will be used,
directly or indirectly, for the purposes of reducing or retiring any
indebtedness which was originally incurred to purchase or carry any margin
stock or other security or for any other purpose which might cause any
borrowing to be considered a “purpose credit” within the meaning of Regulations
U, T or X of the Board of Governors of the Federal Reserve System, as amended.
Grantor intends to and agrees to use the proceeds of the Loan solely for the
lawful, proper business or commercial purposes set forth in its application for
the Loan and any disbursement direction letter furnished by Grantor to Lender
in connection with the Loan.
	 
	 	(ii)	 	Grantor is not engaged, principally or as one of its important
activities, in the business of purchasing or carrying margin stock, or
extending credit for the purpose of purchasing or carrying margin stock.
	 
	 	(iii)	 	Neither Grantor nor any entity controlling Grantor is or is
required to be registered as an “investment company” under the Investment
Company Act of 1940.





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	 	bb.	 	Disclosure. Grantor has disclosed to Lender all agreements,
instruments and corporate or other restrictions to which it is subject, and all other
matters known to it, that, individually or in the aggregate, could reasonably be
expected to result in a material adverse effect on Grantor’s ability to perform its
obligations under the Loan Documents. No report, financial statement, certificate or
other information furnished (whether in writing or orally) by or on behalf of Grantor
to Lender in connection with the transactions contemplated hereby and the negotiation
of this Deed of Trust or delivered hereunder (as modified or supplemented by other
information so furnished) contains any material misstatement of fact or omits to state
any material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided that, with
respect to projected financial information, Grantor represents only that such
information was prepared in good faith based upon assumptions believed to be reasonable
at the time.
	 
	 	cc.	 	No Further Disposition. Other than with respect to the lien granted
herein to Lender and, to the extent of the encumbrances on the Property that have been
permitted by Lender, Grantor has not entered into any agreement or understanding or
taken, permitted or suffered to exist any action (including the filing of a financing
statement, agreement, pledge, deed to secure debt, deed of trust or mortgage, notice or
registration) or event (whether by operation of law or otherwise) for the purpose of,
or that may have the effect of, directly or indirectly, granting or permitting any lien
on or disposing of any Collateral, any interest therein or rights pertaining thereto.
	 
	 	dd.	 	Brokers and Financial Advisors. Except as previously disclosed to
Lender in writing, no brokers or finders were used in connection with the financing
contemplated hereby and Grantor hereby agrees to indemnify and hold Lender harmless
from and against any and all liabilities, costs and expenses (including reasonable
attorney’s fees and court costs) suffered or incurred by Lender as a result of or
arising out of any of the transactions contemplated hereby. The provisions of this
section shall survive the expiration and termination of this Deed of Trust and the
payment of the Secured Obligations.
	 
	 	ee.	 	Compliance with OFAC Rules and Regulations. Neither Grantor nor, to
Grantor’s knowledge, any Affiliate of any Grantor (i) is a Sanctioned Person, (ii) has
any assets in Sanctioned Countries, or (iii) derives any operating income from
investments in, or transactions with Sanctioned Persons or Sanctioned Countries. No
part of the proceeds of any borrowing hereunder will be used directly or indirectly to
fund any operations in, finance any investments or activities in or make any payments
to, a Sanctioned Person or a Sanctioned Country.
	 
	 	 	 	For purposes of this Section 5.1(ee) only, “Affiliate” of any entity means any other
entity directly or indirectly controlling, controlled by or under common control
with such entity. An entity shall be deemed to control another entity if the
controlling entity is the “beneficial owner” (as defined in Rule 13d-3 under the
Securities Exchange Act of 1934) of 10% or more of any class of voting securities
(or other ownership interests) of the controlled entity or possesses, directly or
indirectly, the power to direct or cause the direction of the management or policies
of the controlled entity, whether through





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	 	 	 	ownership of voting securities, by contract or otherwise. For all other provisions
of this Deed of Trust, “Affiliate” shall have the meaning given to such term in the
Note.
	 
	 	 	 	For purposes of this Deed of Trust, “Sanctioned Country” shall mean a country
subject to a sanctions program identified on the list maintained by U.S. Department
of the Treasury’s Office of Foreign Assets Control (“OFAC”) and available at
http://www.treas.gov/offices/enforcement/ofac/programs/index.shtml, or as
otherwise published from time to time.
	 
	 	 	 	For purposes of this Deed of Trust, “Sanctioned Person” shall mean (i) a person
named on the list of “Specially Designated Nationals and Blocked Persons” maintained
by OFAC available at
http://www.treas.gov/offices/enforcement/ofac/sdn/index.shtml, or as
otherwise published from time to time, or (ii) (A) an agency of the government of a
Sanctioned Country, (B) an organization controlled by a Sanctioned Country, or (C) a
person resident in a Sanctioned Country, to the extent subject to a sanctions
program administered by OFAC.
	 
	 	ff.	 	Foreign Assets Control Regulations, Etc. Grantor is not an “enemy” or
an “ally of the enemy” within the meaning of Section 2 of the Trading with the Enemy
Act of the United States of America (50 U.S.C. App. §§ 1 et seq.), as amended. Grantor
is not is in violation of (a) the Trading with the Enemy Act, as amended, (b) any of
the foreign assets control regulations of the United States Treasury Department (31
CFR, Subtitle B, Chapter V, as amended) or any enabling legislation or executive order
relating thereto or (c) the USA Patriot Act of 2001, Pub. L. No. 107-56 (the
“Patriot Act”). Grantor (i) is not a blocked person described in Section 1 of
the Anti-Terrorism Order or (ii) to the best of its knowledge, does not engage in any
dealings or transactions, and is not otherwise associated, with any such blocked
person.






	 	 	 	As used in this Section 5.1, to “Grantor’s current actual knowledge” shall mean
to the current actual knowledge of Todd J. Weiss and Raymond
Silliere.






	5.2.	 	REPRESENTATIONS, WARRANTIES AND COVENANTS REGARDING ENTITY STATUS.
	 
	 	 	In connection with the Loan, Grantor hereby represents, warrants and covenants to Lender as
follows with respect to Grantor:






	 	a.	 	such entity was organized solely for the purpose of (i) owning and holding the
Property or any property subsequently substituted therefor in compliance with the Loan
Documents; acting as landlord, lessor, or similar designation; and executing and
performing any documents executed or to be executed by such entity as required by
Lender in connection with the Loan and (ii) engaging in any lawful act or activity and
exercising any powers permitted to limited liability companies organized under the laws
of the State of Delaware that are related or incidental to and necessary, convenient or
advisable for the accomplishment of (i) above;





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	 	b.	 	such entity has not engaged in, and will not engage in, any business other than
the actions required or permitted to be performed under this Section or the other Loan
Documents;
	 
	 	c.	 	such entity has not had, and will not have, any assets other than the Property
(and personal property incidental to the ownership and operation of the Property);
	 
	 	d.	 	such entity, to the fullest extent permitted by law, has not engaged in, and
will not engage in, seek or consent to any dissolution, winding up, liquidation,
consolidation, merger, asset sale, or other transfer of ownership interest other than
such activities as are expressly permitted pursuant to any provisions of the Loan
Documents;
	 
	 	e.	 	such entity, to the fullest extent permitted by law, has not engaged in, and
will not engage in, seek or consent to any dissolution or liquidation or consolidation
or merging of itself with or into any other entity, or conveying or transferring of its
properties and assets substantially as an entirety or transferring of any of its
beneficial interests to any entity other than as expressly permitted by the Loan
Documents, or voluntarily commencing of a case with respect to itself, as debtor, under
the Federal Bankruptcy Code or any similar federal or state statute without the
unanimous consent of its Member;
	 
	 	f.	 	except as permitted under the Loan Documents or unless required by Applicable
Law, such entity shall not make any material amendment to Sections 4, 8, 10, 14, 17 or
27 of its Limited Liability Company Agreement or its Certificate of Formation without
first obtaining approval of the grantee holding the Loan Documents encumbering any
portion of the Property;
	 
	 	g.	 	such entity shall not incur, create or assume any indebtedness other than as
expressly permitted under the Loan Documents;
	 
	 	h.	 	such entity has not failed to correct, and will not fail to correct, any known
misunderstanding regarding the separate identity of such entity;
	 
	 	i.	 	such entity has maintained, and will maintain, its bank accounts, books and
records separate from any other person or entity;
	 
	 	j.	 	such entity has not commingled, and will not commingle, its assets with those
of any other entity, except as permitted by the Loan Documents;
	 
	 	k.	 	such entity has conducted and will continue to conduct its business in its own
name and strictly comply with all organizational formalities to maintain its separate
existence;
	 
	 	l.	 	such entity has maintained, and will maintain, separate financial statements;
	 
	 	m.	 	such entity has maintained, and will maintain, its assets in such a manner that
it is not costly or difficult to segregate, identify or ascertain such assets;





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	 	n.	 	such entity has prepared, and will prepare, separate tax returns from those of
any person to the extent required by applicable law and pay any taxes required to be
paid by applicable law;
	 
	 	o.	 	 such entity has paid, and will pay, its own liabilities and expenses out of and
to the extent of its own funds;
	 
	 	p.	 	such entity as of the date of this Deed of Trust has not guaranteed, and will
not guarantee any obligation of any person, including any Affiliate of such entity or
hold out its credit or assets as being available to satisfy the obligations of any
other entity, other than as permitted by the Loan Documents;
	 
	 	q.	 	such entity has not acquired, and will not acquire, any securities of its
members;
	 
	 	r.	 	such entity has allocated, and will allocate fairly and reasonably, any common
employee or overhead shared with Affiliates and each such entity has used, and will
use, separate invoices and checks;
	 
	 	s.	 	such entity has identified and will identify itself in all communications, and
has caused and will cause its agents to indicate such capacity when acting on behalf of
such entity;
	 
	 	t.	 	such entity has not pledged, and will not pledge, its assets for the benefit of
any other person or entity, except as permitted by the Loan Documents;
	 
	 	u.	 	such entity has held itself, and will hold itself, out to creditors, the public
and all other persons, as a legal entity separate from its members and any other
person;
	 
	 	v.	 	such entity has not made, and will not make or permit to remain outstanding any
loan or advance to, or own or acquire any stock or securities of, any person, except
that such entity may invest in those investments permitted under the Loan Documents and
may make any advance required or expressly permitted to be made pursuant to any
provisions of such entity’s organizational documents and permit the same to remain
outstanding in accordance with such provisions;
	 
	 	w.	 	such entity has maintained, and will maintain, an arm’s-length relationship
with its Affiliates;
	 
	 	x.	 	such entity has paid, and will pay, the salaries of its own employees, if any,
out of its own funds and has maintained and will maintain a sufficient number of
employees in light of its contemplated business purpose;
	 
	 	y.	 	such entity has maintained, and will maintain, adequate capital in light of its
contemplated business purpose, transactions and liabilities;
	 
	 	z.	 	such entity has not and will not form, acquire or hold any subsidiary (whether
corporate, partnership, limited liability company or other);





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	 	aa.	 	such entity has not and will not permit any Affiliate to guarantee or pay its
obligations (other than limited guarantees and indemnities set forth in the Loan
Documents);
	 
	 	bb.	 	if such entity is a limited liability company, its operating agreement contains
the provisions set forth in this Section 5.2 and such entity shall conduct its
business and operations in strict compliance with the terms contained therein.





ARTICLE 6 RIGHTS AND DUTIES OF THE PARTIES





	6.1.	 	MAINTENANCE AND PRESERVATION OF THE PROPERTY. Grantor shall (or shall cause a
Tenant, in accordance with the Lease to): (a) keep the Property in good condition and repair;
(b) complete or restore promptly and in workmanlike manner the Property or any part thereof
which may be damaged or destroyed; (c) comply or cause the Property to comply with, (i) all
laws, ordinances, regulations and standards, (ii) all covenants, conditions, restrictions and
equitable servitudes, whether public or private, of every kind and character and (iii) all
requirements of insurance companies and any bureau or agency which establishes standards of
insurability, in each case to avoid a Material Adverse Effect (as defined in Section
6.3 below), which laws, covenants or requirements affect the Property and pertain to acts
committed or conditions existing thereon, including, without limitation, any work of
alteration, improvement or demolition as such laws, covenants or requirements mandate; (d)
operate and manage the Property at all times in a professional manner and do all other acts
which from the character or use of the Property may be reasonably necessary to maintain and
preserve its value; (e) promptly after execution, deliver to Lender a copy of any management
agreement concerning the Property and all amendments thereto and waivers thereof; and (f)
execute and acknowledge all further documents, instruments and other papers as Lender deems
reasonably necessary or appropriate to preserve, continue, perfect and enjoy the benefits of
this Deed of Trust and perform Grantor’s obligations, including, without limitation,
statements of the amount secured hereby then owing and statements of no offset. In addition,
Grantor shall not (except as may be permitted under any Lease): (A) remove or demolish all or
any material part of the Property, except in connection with any remedial or other action
required to comply with applicable Hazardous Materials Laws, provided that any Property
removed shall be removed in accordance with any applicable laws and such Property be replaced
with property of equal or greater value; (B) alter either (i) the exterior of the Property in
a manner which materially and adversely affects the value of the Property or (ii) the roof or
other structural elements of the Property in a manner which requires a building permit, except
for tenant improvements required or permitted under the Leases; (C) initiate or acquiesce in
any change in any zoning or other land classification which affects the Property; (D)
materially alter the type of occupancy or use of all or any part of the Property; or (E)
commit or permit waste of the Property.
	 
	6.2.	 	HAZARDOUS MATERIALS. Without limiting any other provision of this Deed of Trust,
Grantor agrees as follows:






	 	a.	 	Prohibited Activities. Grantor shall not cause or permit the Property
to be used as a site for the use, generation, manufacture, storage, treatment, release,
discharge, disposal, transportation or presence of any of the following (collectively,
“Hazardous Materials”) which are either in violation of Hazardous Materials
Laws (defined below) or which exist in quantities in excess of what is permitted under
Hazardous Materials Laws: oil or other





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	 	 	 	petroleum products; flammable explosives; asbestos; urea formaldehyde insulation;
radioactive materials; hazardous wastes; fungus, mold, mildew, spores or other
biological or microbial agents the presence of which may affect human health, impair
occupancy or materially affect the value or utility of the Property; toxic or
contaminated substances or similar materials, including, without limitation, any
substances which are “hazardous substances,” “hazardous wastes,” “hazardous
materials” or “toxic substances” under the Hazardous Materials Laws (defined below)
and/or other applicable environmental laws, ordinances or regulations.
	 
	 	 	 	Notwithstanding the foregoing, (i) Grantor may store, maintain and use on the
Property janitorial and maintenance supplies, paint and other Hazardous Materials of
a type and in a quantity readily available for purchase by the general public and
normally stored, maintained and used by owners and managers of properties of a type
similar to the Property; (ii) Tenants of the Property may store, maintain and use on
the Property (and, if any Tenant is a retail business, hold in inventory and sell in
the ordinary course of such Tenant’s business) Hazardous Materials of a type and
quantity readily available for purchase by the general public and normally stored,
maintained and used (and, if Tenant is a retail business, sold) by tenants in
similar lines of business on properties similar to the Property; and (iii) any
person undertaking an investigation or remediation of Hazardous Materials in, on at
or under the Property may temporarily maintain, store and/or handle such Hazardous
Materials at the Property, provided, such person is fully authorized by applicable
law to handle such materials, such Hazardous Materials are reasonably necessary to
the investigation or remediation, and such Hazardous Materials are brought upon the
Property and are upon completion of such investigation or remediation promptly
removed, in accordance with applicable Hazardous Materials Laws.
	 
	 	b.	 	Hazardous Materials Laws. Grantor shall comply and cause the Property
to comply with all federal, state and local laws, ordinances and regulations relating
to Hazardous Materials (“Hazardous Materials Laws”), including, without
limitation: the Clean Air Act, as amended, 42 U.S.C. Section 7401 et seq.; the Federal
Water Pollution Control Act, as amended, 33 U.S.C. Section 1251 et seq.; the Resource
Conservation and Recovery Act of 1976, as amended, 42 U.S.C. Section 6901 et seq.; the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, as
amended (including the Superfund Amendments and Reauthorization Act of 1986,
“CERCLA”), 42 U.S.C. Section 9601 et seq.; the Toxic Substances Control Act, as
amended, 15 U.S.C. Section 2601 et seq.; the Occupational Safety and Health Act, as
amended, 29 U.S.C. Section 651; the Emergency Planning and Community Right-to-Know Act
of 1986, 42 U.S.C. Section 11001 et seq.; the Mine Safety and Health Act of 1977, as
amended, 30 U.S.C. Section 801 et seq.; the Safe Drinking Water Act, 42 U.S.C. Section
300f et seq.; and all comparable state and local laws, laws of other jurisdictions or
orders and regulations.
	 
	 	c.	 	Notices. Except as set forth in the Environmental Reports, Grantor
shall promptly notify Lender in writing of: (i) its acquiring actual knowledge of any
Hazardous Materials on, under or about the Property (other than Hazardous Materials
permitted under Section 6.2.a); (ii) any knowledge by Grantor that the Property
does not comply with any





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	 	 	 	Hazardous Materials Laws; (iii) any claims or actions (“Hazardous Materials
Claims”) pending or threatened against Grantor, or, to Grantor’s knowledge, the
Property by any governmental entity or agency or any other person or entity relating
to Hazardous Materials or pursuant to the Hazardous Materials Laws; and (iv) its
acquiring actual knowledge of any occurrence or condition on any real property
adjoining or in the vicinity of the Property that could cause the Property or any
part thereof to become contaminated by or with Hazardous Materials; provided that
said discovery, non-compliance or claim would materially and adversely affect the
value of the Property as security for the Loan or the intended use of the Property.
	 
	 	d.	 	Remedial Action. In response to the presence of any Hazardous
Materials on, under or about the Property, Grantor shall, in accordance with Hazardous
Materials Laws, take or cause to be taken, at Grantor’s sole expense, all remedial
action required by any Hazardous Materials Laws or any judgment, consent decree,
settlement or compromise in respect to any Hazardous Materials Claims.
	 
	 	e.	 	Inspection By Lender. Upon reasonable prior notice to Grantor (and
with respect to any Lease, subject to any restrictions or prohibitions set forth in
such Lease), Lender, its employees and agents, may from time to time (whether before or
after the commencement of a non-judicial or judicial foreclosure proceeding), enter and
inspect the Property for the purpose of determining the existence, location, nature and
magnitude of any past or present release or threatened release of any Hazardous
Materials into, onto, beneath or from the Property.
	 
	 	f.	 	Monitoring. Upon notice to Grantor or Grantor’s acquiring actual
knowledge that the Property has violated Hazardous Materials Laws, Grantor shall comply
or cause any Tenant to comply with the terms and conditions regarding remediation and
monitoring as set forth in the Environmental Liabilities Agreement of even date
herewith, executed by Grantor in favor of Lender.
	 
	 	g.	 	Underground Storage Tanks. Grantor shall not install or permit to be
installed any asbestos-containing materials at the Property. Grantor shall remedy or
cause the remedy of all violations of Hazardous Materials Laws with respect to any
asbestos or any existing underground or above ground storage tanks (“Storage
Tanks”) including, but not limited to, removal of Storage Tanks in the manner and
as required by applicable Hazardous Materials Laws. If required by applicable
Hazardous Materials Laws, to Grantor’s actual knowledge, Grantor or its predecessor in
interest has registered all Storage Tanks which are now located on the Property and has
paid all fees assessed by the applicable authority in connection with such tanks (and
Grantor will so register and pay said fees, or cause any Tenant to so register and pay
said fees, with respect to any Storage Tanks hereafter located on the Property), as
required by Hazardous Materials Laws. To the extent any such Storage Tanks have not
been registered, Grantor will hereafter promptly register such Storage Tanks and pay
any fees assessed by the applicable authority in connection therewith, as required by
Hazardous Materials Laws or cause any Tenant to so register and pay said fees. Grantor
will comply, or cause compliance, with the above mentioned laws, the Federal Solid
Waste Disposal Act, and





DEED OF TRUST (VIRGINIA)

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Loan No. 02-62113748/Store No. 568




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40 C.F.R. Part 280, as supplemented and amended, including without limitation,
requirements for financial assurance, tank replacement and monitoring.




	6.3.	 	COMPLIANCE WITH LAWS. Grantor shall comply, or cause compliance (in each case to
avoid a Material Adverse Effect), with all federal, state and local laws, rules and
regulations applicable to the Property, including, without limitation, all zoning and building
requirements and all requirements of the Americans With Disabilities Act of 1990 (42 U.S.C.
Section 12101 et seq.), as amended from time to time. Grantor shall possess and maintain or
cause Grantor’s Tenant to possess and maintain in full force and effect at all times, in each
case to avoid a Material Adverse Effect: (a) all certificates of occupancy and other
licenses, permits and authorizations required by applicable law for the existing use of the
Property and (b) all permits, franchises and licenses and all rights to all trademarks, trade
names, patents and fictitious names, if any, required by applicable law for Grantor to conduct
the business(es) in which Grantor is now engaged. The term “Material Adverse Effect”
means (a) a material and adverse effect on (i) the value of the Property as security for the
Loan or (ii) the intended use of the Property, (b) resulting in fines in excess of $5,000.00,
(c) resulting in penalties or sanctions that could impair the business, operations,
properties, assets or condition (financial or otherwise) of Grantor’s Tenant when considered
with respect to the Property, (d) material impairment of the ability of Grantor’s Tenant to
perform its obligations under its Lease, (e) material impairment of the landlord’s rights
under any Lease, or (f) imposition of liens upon the Property. In determining whether any
individual event would result in a Material Adverse Effect, notwithstanding that such event
does not of itself have such effect, a Material Adverse Effect shall be deemed to have
occurred if the cumulative effect of such event and all other then occurring events and
existing conditions would result in a Material Adverse Effect.
	 
	6.4.	 	LITIGATION. Grantor shall promptly notify Lender in writing of any litigation
pending or threatened against Grantor claiming damages in excess of $250,000.00 and of all
pending or threatened litigation against Grantor if the aggregate damage claims against
Grantor exceed $500,000.00.
	 
	6.5.	 	MERGER, CONSOLIDATION, TRANSFER OF ASSETS. Grantor shall not: (a) merge or
consolidate with any other entity; (b) make any substantial change in the nature of Grantor’s
business or structure; (c) acquire all or substantially all of the assets of any other entity;
or (d) sell, lease, assign, transfer or otherwise dispose of a material part of Grantor’s
assets, except in the ordinary course of Grantor’s business or in accordance with the
terms of the Note.
	 
	6.6.	 	ACCOUNTING RECORDS. Grantor shall maintain adequate books and records in accordance
with the same accounting standard used by Grantor to prepare the financial statements
delivered to and approved by Lender in connection with the making of the Loan or other
accounting standards approved by Lender. Grantor shall permit any representative of Lender,
at any reasonable time and from time to time, to inspect, audit and examine such books and
records and make copies of same. Unless a Default exists, any such inspection beyond one (1)
time a year shall be at Lender’s expense.
	 
	6.7.	 	COSTS, EXPENSES AND ATTORNEYS’ FEES. Grantor shall pay to Lender the full amount of
all costs and expenses, including, without limitation, reasonable attorneys’ fees and
expenses, incurred by Lender in connection with: (a) appraisals and inspections of the
Property or Collateral





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	 	 	required by Lender as a result of (i) a Transfer or proposed Transfer (as defined below), or
(ii) a Default; (b) appraisals and inspections of the Property or Collateral required by
applicable law, including, without limitation, federal or state regulatory reporting
requirements; and (c) any acts performed by Lender at Grantor’s request or wholly or
partially for the benefit of Grantor (including, without limitation, the preparation or
review of amendments, assumptions, waivers, releases, reconveyances, estoppel certificates
or statements of amounts owing under any Secured Obligation). In connection with appraisals
and inspections, Grantor specifically (but not by way of limitation) acknowledges that:
(aa) a formal written appraisal of the Property by a state certified or licensed appraiser
may be required by federal regulatory reporting requirements on an annual or more frequent
basis; and (bb) Lender may require inspection of the Property by an independent supervising
architect, a cost engineering specialist, or both. Grantor shall pay all indebtedness
arising under this Section immediately upon demand by Lender together with late charges
thereon as set forth in the Note if not paid by Grantor on or before the fourth (4th) day
after the demand for payment is made by Lender.
	 
	6.8.	 	LIENS, ENCUMBRANCES AND CHARGES. Grantor shall promptly discharge (or cause to be
discharged) by bonding or otherwise any lien, charge or other encumbrance which attaches to
the Property in violation of Section 6.15. Subject to Grantor’s right to contest such
matters under this Deed of Trust or Tenant’s right to contest such matters under any Lease or
as expressly permitted in the Loan Documents, Grantor shall pay when due or cause to be paid
when due all obligations secured by or reducible to liens and encumbrances which shall now or
hereafter encumber or appear to encumber all or any part of the Property or any interest
therein, whether senior or subordinate hereto, including, without limitation, all claims for
work or labor performed, or materials or supplies furnished, in connection with any work of
demolition, alteration, repair, improvement or construction of or upon the Property, except
such as Grantor may in good faith contest or as to which a bona fide dispute may arise
(provided provision is made to the satisfaction of Lender for eventual payment thereof in the
event that Grantor is obligated to make such payment and that any recorded claim of lien,
charge or other encumbrance against the Property is promptly discharged by bonding or
otherwise). So long as it complies with the provisions of this Section 6.8 and any
other relevant provisions of a Lease, a Tenant under a Lease shall have the right to perform
Grantor’s obligations under this Section 6.8.
	 
	6.9.	 	TAXES AND OTHER LIABILITIES. Subject to Grantor’s rights to contest such taxes and
assessments under Section 8.3 of this Deed of Trust or Tenant’s right to contest such
matters under any Lease or as expressly permitted in the other Loan Documents, Grantor shall
pay and discharge or cause to be paid and discharged when due any and all indebtedness,
obligations, assessments and taxes, both real and personal and including federal and state
income taxes and state and local property taxes and assessments. Upon request of Lender,
Grantor shall promptly provide to Lender copies of all tax and assessment notices pertaining
to the Property. Grantor hereby authorizes Lender to obtain, at Grantor’s expense, a tax
service contract which shall provide tax information on the Property to Lender for the term of
the Loan and any extensions or renewals of the Loan.
	 
	6.10.	 	INSURANCE COVERAGE. Grantor shall comply with the terms and provisions of that
certain Agreement Regarding Required Insurance dated as of the date hereof by and between
Grantor and Lender.





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Loan No. 02-62113748/Store No. 568




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	6.11.	 	CONDEMNATION AND INSURANCE PROCEEDS.






	 	a.	 	Assignment of Claims. Grantor absolutely and irrevocably assigns to
Lender all of the following rights, claims and amounts (collectively,
“Claims”), all of which shall be paid to Lender except as otherwise provided in
any Lease: (i) all awards of damages and all other compensation to which Grantor is
entitled directly or indirectly by reason of a condemnation or proposed condemnation
for public or private use affecting all or any part of, or any interest in, the
Property; (ii) all other claims and awards to which Grantor is entitled for damages to
or decrease in value of all or any part of, or any interest in, the Property; (iii) all
proceeds of any insurance policies payable to Grantor by reason of loss sustained to
all or any part of the Property; and (iv) all interest which may accrue on any of the
foregoing; any such awards, proceeds, interest and other sums of the Claims herein
collectively called, “Proceeds.” Grantor shall give Lender prompt written
notice upon learning of the occurrence of any casualty affecting, or the institution of
any proceedings for eminent domain or for the condemnation of, the Property or any
portion thereof. So long as no Default has occurred and is continuing at the time; (i)
Grantor shall have the right to adjust, compromise and settle any Claim or group of
related Claims of $100,000.00 or less without the participation or consent of Lender
and (ii) Lender shall have the right to participate in and consent to any adjustment,
compromise or settlement of any Claim or group of related Claims exceeding $100,000.00.
If a Default has occurred and is continuing at the time, Grantor hereby irrevocably
empowers Lender, in the name of Grantor, as Grantor’s true and lawful attorney in fact,
to commence, appear in, defend, prosecute, adjust, compromise and settle all Claims;
provided, however, Lender shall not be responsible for any failure to undertake any or
all of such actions regardless of the cause of the failure. All Proceeds shall, in all
cases, be payable to Lender, except as otherwise provided in any Lease.
	 
	 	b.	 	Application of Proceeds; No Default. So long as no Default has
occurred and is continuing at the time of Lender’s receipt of the Proceeds and no
Default occurs thereafter, the following provisions shall apply (subject to the rights
of Tenant under any Lease):






	 	(i)	 	Condemnation. If the Proceeds are the result of Claims
described in clauses 6.11.a.(i) or (ii) above, or interest accrued thereon,
Lender shall apply the Proceeds in the following order of priority: First, to
Lender’s expenses in settling, prosecuting or defending the Claims; Second, to
the repair or restoration of the portion of the Property, if any, not
condemned or proposed for condemnation and not otherwise the subject of a claim
or award; and Third, to the Secured Obligations in any order without
suspending, extending or reducing any obligation of Grantor to make installment
payments.
	 
	 	(ii)	 	Casualty and Other Insurance. If the Proceeds are the
result of Claims described in clause 6.11.a.(iii) above or interest accrued
thereon, Lender shall apply the Proceeds in the following order of priority:
First, to Lender ‘s expenses in settling, prosecuting or defending the Claims;
Second, to the repair or restoration of the Property; and Third, (aa) if the
repair or restoration of the Property has been completed and all costs incurred
in connection with the repair





DEED OF TRUST (VIRGINIA)

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Loan No. 02-62113748/Store No. 568




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or restoration have been paid in full, to Grantor or (bb) in all other
circumstances, to the Secured Obligations in any order without suspending,
extending or reducing any obligation of Grantor to make installment
payments.




	 	(iii)	 	Restoration. Notwithstanding the foregoing
Sections 6.11.b.(i) and (ii), but subject to the rights of Tenant under
any Lease, Lender shall have no obligation to make any Proceeds available for
the repair or restoration of all or any portion of the Property unless and
until all the following conditions have been satisfied: (aa) delivery to Lender
of the Proceeds plus any additional amount which is needed to pay all costs of
the repair or restoration (including, without limitation, taxes, financing
charges, insurance and rent during the repair period); (bb) establishment of an
arrangement for lien releases and disbursement of funds acceptable to Lender;
(cc) delivery to Lender in form and content acceptable to Lender of all of the
following: (1) plans and specifications for the work; (2) a contract for the
work, signed by a contractor acceptable to Lender; (3) a cost breakdown for the
work; (4) if reasonably required by Lender, a payment and performance bond for
the work; (5) evidence of the continuation of all Leases unless consented to in
writing by Lender; (6) evidence that, upon completion of the work, the size,
capacity, value, and income coverage ratios for the Property will be at least
as great as those which existed immediately before the damage or condemnation
occurred; (7) evidence that the work can reasonably be completed on or before
that date which is six (6) months prior to the Maturity Date; and (8) evidence
of the satisfaction of any additional conditions that Lender may reasonably
establish to protect Lender’s security. Grantor acknowledges that the specific
conditions described above are reasonable.






	 	c.	 	Application of Proceeds; Default. If a Default has occurred and is
continuing at the time of Lender’s receipt of the Proceeds or if a Default occurs at
any time thereafter, Lender may, at Lender’s absolute discretion and regardless of any
impairment of security or lack of impairment of security, but subject to applicable law
governing use of the Proceeds, if any, and the rights of Tenant under any Lease, apply
all or any of the Proceeds to Lender’s expenses in settling, prosecuting or defending
the Claims and then apply the balance to the Secured Obligations in any order without
suspending, extending or reducing any obligation of Grantor to make installment
payments, and may release all or any part of the Proceeds to Grantor upon any
conditions Lender chooses.






	6.12.	 	IMPOUNDS. Any impounds payable by Grantor under the Loan Documents
(“Impounds”) shall be deposited into one or more segregated or commingled accounts
maintained by Lender or its servicing agent. Except as otherwise provided in the Loan
Documents, such account(s) shall not bear interest. Lender shall not be a trustee, special
depository or other fiduciary for Grantor with respect to such account. If no Default exists,
Lender shall apply all Impounds in accordance with the Loan Documents. If a Default exists,
Lender may apply any or all Impounds to any Secured Obligation or to cure such Default,
whereupon Grantor shall promptly restore all Impounds so applied and cure all Defaults not
cured by such application. The obligations of Grantor hereunder shall not be diminished by
Grantor’s deposits of Impounds, except to the extent that such obligations are actually
satisfied by Lender’s application of such Impounds. Upon any assignment of this Deed of
Trust, Lender may assign all Impounds in its possession to





DEED OF TRUST (VIRGINIA)

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Loan No. 02-62113748/Store No. 568




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	 	 	Lender’s assignee, whereupon Lender shall be released from all liability with respect to
such Impounds. Within sixty (60) days following full repayment of the Secured Obligations
(other than as a consequence of foreclosure or conveyance in lieu of foreclosure) or at such
earlier time as Lender may elect, Lender shall pay to Grantor all Impounds in its
possession, and no other party shall have any right or claim thereto. Grantor shall deliver
to Lender, promptly upon receipt, all bills for taxes and insurance for which Lender has
required Impounds.
	 
	6.13.	 	DEFENSE AND NOTICE OF LOSSES, CLAIMS AND ACTIONS. Grantor shall protect, preserve
and defend the Property and title to and right of possession of the Property, the security of
this Deed of Trust and the rights and powers of Lender hereunder at Grantor’s sole expense
against all adverse claims, whether the claim: (a) is against a possessory or non-possessory
interest; (b) arose prior or subsequent to the Effective Date; or (c) is senior or junior to
Grantor’s or Lender’s rights. Grantor shall give Lender prompt notice in writing upon
learning of the assertion of any claim, of the filing of any action or proceeding, of the
occurrence of any damage to the Property and of any condemnation offer or action.
	 
	6.14.	 	RIGHT OF INSPECTION. Subject to any restrictions or prohibitions set forth in any
Lease, Lender and its independent contractors, agents and employees may enter the Property
from time to time at any reasonable time and upon five (5) Business Days’ prior notice for the
purpose of inspecting the Property and ascertaining Grantor’s compliance with the terms of
this Deed of Trust. Lender shall use reasonable efforts to assure that Lender’s entry upon
and inspection of the Property shall not materially and unreasonably interfere with the
business or operations of Grantor or Grantor’s Tenants on the Property.
	 
	6.15.	 	DUE ON SALE/ENCUMBRANCE.






	 	a.	 	Definitions. The following terms shall have the meanings indicated:
	 
	 	 	 	“Restricted Party” shall mean each of (i) Grantor, (ii) any entity obligated
under any guaranty or indemnity made in favor of Lender in connection with the Loan
and (iii) any shareholder, partner, member or any direct owner of Grantor or any
entity obligated under item (ii) hereinabove.
	 
	 	 	 	“Transfer” shall mean any sale, installment sale, exchange, mortgage,
pledge, hypothecation, assignment, encumbrance or other transfer, conveyance or
disposition, whether voluntarily, involuntarily or by operation of law or otherwise.
	 
	 	b.	 	Property Transfers.






	 	(i)	 	Prohibited Property Transfers. Without the prior
written consent of Lender, Grantor shall not cause or permit any Transfer of
all or any part of the Property or the Collateral (collectively, a
“Prohibited Property Transfer”), including, without limitation, the
Transfer of all or any part of Grantor’s right, title and interest in and to
the Property, any Leases or any Payments.
	 
	 	(ii)	 	Permitted Property Transfers. Notwithstanding the
foregoing, none of the following Transfers shall be deemed to be a Prohibited
Property Transfer: (A) a





DEED OF TRUST (VIRGINIA)

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Loan No. 02-62113748/Store No. 568




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	 	 	 	Transfer which is expressly permitted under the Note; (B) a Lease which is
permitted under Article 3; and (C) the sale of inventory in the
ordinary course of the business at the Property.






	 	c.	 	Equity Transfers.






	 	(i)	 	Prohibited Equity Transfers. Without the prior written
consent of Lender, Grantor shall not cause or permit any Transfer of any
interest in a Restricted Party (collectively, a “Prohibited Equity
Transfer”), including without limitation, (A) if a Restricted Party is a
corporation (other than Cole Credit Property Trust III, Inc.), any merger,
consolidation or other Transfer of more than 10% of such corporation’s stock or
the creation or issuance of new stock in one or a series of transactions
resulting in total capital stock then issued and outstanding which is more than
110% of the total immediately prior to such issuance; (B) if a Restricted Party
is a limited partnership, limited liability partnership, general partnership or
joint venture, any merger or consolidation or the change, removal, resignation
or addition of a general partner or the Transfer of the partnership interest of
any general partner or any profits or proceeds relating to such partnership
interests; (C) if a Restricted Party is a limited liability company, any merger
or consolidation or the change, removal, resignation or addition of a managing
member (or if no managing member, any member) or any profits or proceeds
relating to such limited liability company interest, or the Transfer of a
non-managing limited liability company interest or the creation or issuance of
new non-managing limited liability company interests; or (D) if a Restricted
Party is a trust, any merger, consolidation or other Transfer of any legal or
beneficial interest in such Restricted Party or the creation or issuance of new
legal or beneficial interests. Notwithstanding the foregoing, in no event
shall a Transfer or proposed Transfer of any direct or indirect legal or
beneficial interest in Grantor (whether by a Restricted Party or a non
Restricted Party) be done in a manner that would violate the Patriot Act.
Notwithstanding the foregoing, with respect to the direct and indirect
interests in Cole Credit Property Trust III, Inc., Grantor shall be permitted
to rely exclusively on the implementation by its U.S. broker-dealer network of
the normal and customary investor screening practices mandated by applicable
law and NASD regulations in satisfaction of the covenant set forth in the
preceding sentence.
	 
	 	(ii)	 	Permitted Equity Transfers. Notwithstanding the
foregoing, however, (i) limited partnership interests in Grantor or in any
general partner or member of Grantor shall be freely transferable without the
consent of Lender, (ii) any involuntary transfer caused by the death of Grantor
or any general partner, shareholder, joint venturer, manager, member or
beneficial owner of a trust shall not be a Default under this Deed of Trust so
long as Grantor is reconstituted, if required, following such death and so long
as those persons responsible for the management of the Property and Grantor
remain unchanged as a result of such death or any replacement management is
approved by Lender, (iii) gifts for estate planning purposes of any
individual’s interests in Grantor or in any of Grantor’s general partners,
managing members or joint venturers to the spouse or any lineal





DEED OF TRUST (VIRGINIA)

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Loan No. 02-62113748/Store No. 568




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	 	 	 	descendant of such individual, or to a trust for the benefit of any one or
more of such individual, spouse, or lineal descendant, shall not be a
Default under this Deed of Trust so long as Grantor is reconstituted, if
required, following such gift and so long as those persons responsible for
the management of the Property and Grantor remain unchanged following such
gift or any replacement management is approved by Lender and (iv) membership
interests in Grantor and interests in any member of Grantor or in any
partner of any member of Grantor may be transferred without the consent of
Lender so long as, after any such transfer, Christopher H. Cole or Cole
Credit Property Trust III, Inc., or any of their wholly owned affiliates or
subsidiaries, “controls” the affairs of Grantor, where the term “control”
means the power to direct the management and policies of Grantor, provided,
that in all of the foregoing cases such transfer shall be done in a manner
that would not violate the Patriot Act, subject to the provisions of the
last sentence of Section 6.15.c.(i). In the event of a transfer by
Cole REIT III Operating Partnership, LP of its interests in Grantor pursuant
to the terms hereof, Grantor agrees to contemporaneously furnish to Lender a
new limited guaranty of the Loan (in form and substance as executed at
closing of the Loan) by a new guarantor satisfactory to Lender in Lender’s
sole and absolute discretion. Grantor shall provide Lender with copies of
the applicable transfer documents or governing instruments in each of the
foregoing instances in the preceding sentence within fifteen (15) days of
the effective date of any such transfer or change.
	 
	 	(iii)	 	Entity Status. Nothing contained in this Section
6.15.c. shall be construed to permit any Transfer which would result in a
breach of any representation, warranty or covenant of Grantor under Section
5.2 above.






	 	d.	 	Certificates of Ownership. Grantor shall deliver to Lender, at any
time and from time to time, not more than five (5) days after Lender’s written request
therefor, a certificate, in form acceptable to Lender, signed and dated by Grantor,
listing the names of all persons and entities holding direct or indirect legal or
beneficial interests in the Property or any Restricted Party and the type and amount of
each such interest, except for the ownership of Cole Credit Property Trust III, Inc., a
Maryland corporation, for which a certificate shall not be required.






	6.16.	 	EXCULPATION. Lender shall not directly or indirectly be liable to Grantor or any
other person as a consequence of: (a) the exercise of the rights, remedies or powers granted
to Lender in this Deed of Trust; (b) the failure or refusal of Lender to perform or discharge
any obligation or liability of Grantor under any agreement related to the Property or under
this Deed of Trust; or (c) any loss sustained by Grantor or any third party resulting from
Lender’s failure to lease the Property after a Default (hereafter defined) or from any other
act or omission of Lender in managing the Property after a Default unless the loss is caused
by the willful misconduct, bad faith or gross negligence of Lender and no such liability shall
be asserted or enforced against Lender, all such liability being expressly waived and released
by Grantor.
	 
	6.17.	 	ACCEPTANCE OF TRUST; POWERS AND DUTIES OF TRUSTEE. Trustee accepts this trust when
this Deed of Trust is recorded. From time to time upon written request of Lender and





DEED OF TRUST (VIRGINIA)

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Loan No. 02-62113748/Store No. 568




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	 	 	presentation of this Deed of Trust, or a certified copy thereof, for endorsement, and
without affecting the personal liability of any person for payment of any indebtedness or
performance of any Secured Obligation, Trustee may, without liability therefor and without
notice: (a) reconvey all or any part of the Property; (b) consent to the making of any map
or plat of the Property; (c) join in granting any easement on the Property; (d) join in any
declaration of covenants and restrictions; or (e) join in any extension agreement or any
agreement subordinating the lien or charge of this Deed of Trust. Nothing contained in the
immediately preceding sentence shall be construed to limit, impair or otherwise affect the
rights of Grantor in any respect. Except as may otherwise be required by applicable law,
Trustee or Lender may from time to time apply to any court of competent jurisdiction for aid
and direction in the execution of the trusts hereunder and the enforcement of the rights and
remedies available hereunder, and Trustee or Lender may obtain orders or decrees directing
or confirming or approving acts in the execution of said trusts and the enforcement of said
remedies. Trustee has no obligation to notify any party of any pending sale or any action
or proceeding (including, without limitation, actions in which Grantor, Lender or Trustee
shall be a party) unless held or commenced and maintained by Trustee under this Deed of
Trust. Trustee shall not be obligated to perform any act required of it hereunder unless
the performance of the act is requested in writing and Trustee is reasonably indemnified and
held harmless against loss, cost, liability and expense.
	 
	6.18.	 	COMPENSATION OF TRUSTEE. Grantor shall pay to Trustee reasonable compensation and
reimbursement for services and expenses in the administration of this trust, including,
without limitation, reasonable attorneys’ fees. Grantor shall pay all indebtedness arising
under this Section immediately upon demand by Trustee or Lender together with interest thereon
from the date the indebtedness arises at the rate of interest then applicable to the principal
balance of the Note as specified therein.
	 
	6.19.	 	INDEMNITY. Without in any way limiting any other indemnity contained in this Deed
of Trust, Grantor agrees to defend, indemnify and hold harmless the Lender Group (hereinafter
defined) from and against any claim, loss, damage, cost, expense or liability directly or
indirectly arising out of: (a) the making of the Loan, except for violations of banking laws
or regulations by the Lender Group; (b) this Deed of Trust, including, without limitation, all
recording costs, taxes, documentary stamp taxes, intangible taxes, and costs of title
insurance endorsements; (c) the execution of this Deed of Trust or the performance of any act
required or permitted hereunder or by law; (d) any failure of Grantor to perform Grantor’s
obligations under this Deed of Trust or the other Loan Documents; (e) any alleged obligation
or under-taking on the Lender Group’s part to perform or discharge any of the representations,
warranties, conditions, covenants or other obligations contained in any other document related
to the Property; (f) any act or omission by Grantor or any contractor, agent, employee or
representative of Grantor with respect to the Property; or (g) any claim, loss, damage, cost,
expense or liability directly or indirectly arising out of: (i) the use, generation,
manufacture, storage, treatment, release, threatened release, discharge, disposal,
transportation or presence of any Hazardous Materials which are found in, on, under or about
the Property (including, without limitation, underground contamination); or (ii) the breach of
any covenant, representation or warranty of Grantor under Sections 5.1.p., 5.1.q., 5.1.r.,
or 6.2 above. This indemnity shall include, without limitation: (aa) all actual damages
(including, without limitation, any third party tort claims or governmental claims, fines or
penalties against the Lender Group); (bb) all court costs and reasonable attorneys’ fees
(including, without limitation, expert witness fees) paid or incurred by the Lender Group; and
(cc)





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	 	 	the costs, whether foreseeable or unforeseeable, of any investigation, repair, cleanup or
detoxification of the Property which is required by any governmental entity or is otherwise
necessary to render the Property in compliance with all laws and regulations pertaining to
Hazardous Materials. The foregoing to the contrary notwithstanding, this indemnity shall
not include any claim, loss, damage, cost, expense or liability directly or indirectly
arising out of the gross negligence or willful misconduct of any member of the Lender Group,
or any claim, loss, damage, cost, expense or liability incurred by the Lender Group arising
from any act or incident on the Property occurring after the full reconveyance and release
of the lien of this Deed of Trust upon the Property, or with respect to the matters set
forth in clause (g), any claim, loss, damage, cost, expense or liability incurred by the
Lender Group resulting from the introduction and initial release of Hazardous Materials on
the Property occurring after the transfer of title to the Property at a foreclosure sale
under this Deed of Trust, either pursuant to judicial decree or the power of sale, or by
deed in lieu of such foreclosure, or after any Member of the Lender Group takes actual
possession of the Property prior to such transfer of title to the Property (and not, for
example, through the appointment of a receiver). “Lender Group,” as used herein,
shall mean (1) Lender (including, without limitation, any participant in the Loan and any of
their respective successors or assigns, whether by sale, a secondary market transaction, or
otherwise), (2) any entity controlling, controlled by or under common control with Lender,
(3) the directors, officers, employees and agents of Lender and such other entities, and (4)
the successors, heirs and assigns of the entities and persons described in foregoing clauses
(1) through (3). Grantor shall pay immediately upon Lender’s demand any amounts owing under
this indemnity together with interest from the date the indebtedness arises until paid at
the rate of interest applicable to the principal balance of the Note as specified therein.
Grantor agrees to use legal counsel reasonably acceptable to the Lender Group in any action
or proceeding arising under this indemnity. THE PROVISIONS OF THIS SECTION SHALL SURVIVE
THE SATISFACTION AND RELEASE OF THIS DEED OF TRUST, BUT GRANTOR’S LIABILITY UNDER THIS
INDEMNITY SHALL BE SUBJECT TO THE PROVISIONS OF THE SECTION IN THE NOTE ENTITLED “BORROWER’S
LIABILITY.” GRANTOR HEREBY AGREES THAT, IN THE EVENT THAT IT IS DETERMINED THAT ADDITIONAL
DOCUMENTARY STAMP TAX OR INTANGIBLE TAX IS DUE HEREON OR ANY MORTGAGE OR DEED TO SECURE DEBT
OR PROMISSORY NOTE EXECUTED IN CONNECTION HEREWITH (INCLUDING, WITHOUT LIMITATION, THE
NOTE), GRANTOR SHALL INDEMNIFY AND HOLD HARMLESS GRANTEE FOR ALL SUCH DOCUMENTARY STAMP TAX
AND/OR INTANGIBLE TAX, INCLUDING ALL PENALTIES AND INTEREST ASSESSED OR CHARGED IN
CONNECTION THEREWITH. GRANTOR SHALL PAY SAME WITHIN TEN (10) DAYS AFTER DEMAND OF PAYMENT
FROM GRANTEE AND THE PAYMENT OF SUCH SUMS SHALL BE SECURED BY THIS DEED OF TRUST AND SUCH
SUMS, IF NOT PAID WITHIN SUCH TEN (10) DAY PERIOD, SHALL BEAR INTEREST AT THE DEFAULT RATE
(AS DEFINED IN THE NOTE) UNTIL PAID IN FULL.
	 
	6.20.	 	RELEASES, EXTENSIONS, MODIFICATIONS AND ADDITIONAL SECURITY. Without notice to or
the consent, approval or agreement of any persons or entities having any interest at any time
in the Property or in any manner obligated under the Secured Obligations (“Interested
Parties”), Lender may, from time to time: (a) fully or partially release any person or
entity from liability for the payment or performance of any Secured Obligation; (b) agree with
Grantor to extend the maturity of any Secured Obligation; (c) make any agreement with Grantor
increasing the amount or otherwise altering the terms of any Secured Obligation; (d) accept





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	 	 	additional security for any Secured Obligation; or (e) release all or any portion of the
Property, Collateral and other security for any Secured Obligation. Except as expressly set
forth in any documents relating to the foregoing actions, none of the foregoing actions
shall release or reduce the personal liability of any of said Interested Parties, or release
or impair the priority of the lien of this Deed of Trust upon the Property.
	 
	6.21.	 	SALE OR PARTICIPATION OF LOAN. Lender may at any time sell, assign, participate or
securitize all or any portion of Lender’s rights and obligations under the Loan Documents, and
any such sale, assignment, participation or securitization may be to one or more financial
institutions or other entities, to private investors, or into the public securities market, in
Lender’s sole discretion. Grantor further agrees that Lender may disseminate to any such
actual or potential purchaser(s), assignee(s) or participant(s) (and to any investment banking
firms, rating agencies, accounting firms, law firms and other third party advisory firms and
investors involved with the Loan and the Loan Documents or the applicable sale, assignment,
participation or securitization) all documents and financial and other information heretofore
or hereafter provided to or known to Lender with respect to: (a) the Property and its
operation; (b) any party connected with the Loan (including, without limitation, Grantor, any
partner or member of Grantor, any constituent partner or member of Grantor, any guarantor and
any non-borrower). In the event of any such sale, assignment, participation or
securitization, Lender and the other parties to the same shall share in the rights and
obligations of Lender set forth in the Loan Documents as and to the extent they shall agree
among themselves. In connection with any such sale, assignment, participation or
securitization, Grantor further agrees that the Loan Documents shall be sufficient evidence of
the obligations of Grantor to each purchaser, assignee or participant, and Grantor shall,
within fifteen (15) days after request by Lender; (c) deliver to Lender such information and
documents relating to Grantor, the Property and its operation and any party connected with the
Loan as Lender or any rating agency may request; (d) deliver to Lender an estoppel certificate
for the benefit of Lender and any other party designated by Lender verifying the status and
terms of the Loan, in form and content satisfactory to Lender; (e) enter into such amendments
to the Loan Documents as may be reasonably requested (including, without limitation, to
restructure all or any part of the Loan into two or more promissory notes in whatever
proportion Lender determines) in order to facilitate any such sale, assignment, participation
or securitization without impairing Grantor’s rights or increasing Grantor’s obligations (and
without requiring a secondary borrower or grantor); (f) if, as a condition to the closing of
the Loan, Grantor was required to be a special-purpose bankruptcy-remote entity, enter into
such amendments to the organizational documents of Grantor as any rating agency may request to
preserve or enhance Grantor’s special-purpose bankruptcy-remote status; and (g) if, as a
condition to the closing of the Loan, Grantor was required to provide Lender with any
nonconsolidation opinions, provide Lender with such amendments and restatements of such
opinions as any rating agency may request. The preparation and delivery of the foregoing
items shall be at Grantor’s sole cost and expense, except for items that are not prepared
and/or provided regularly pursuant to the terms of the Loan Documents, and provided further
that Grantor obtains Lender’s consent to the cost of any extraordinary item to be paid by
Lender prior to incurring such expense. The indemnity obligations of Grantor under the Loan
Documents shall also apply with respect to any purchaser, assignee or participant.
	 
	6.22.	 	RECONVEYANCE. Upon payment in full of the Secured Obligations (including, without
limitation, repayment in full of all principal, interest and other amounts owing under the
Note),





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	 	 	and all obligations, if any, of Lender for future advances have been terminated, then, and
in that event only, Trustee, at the direction of Lender, shall release, without warranty,
this Deed of Trust by reconveying title to the Property or that portion thereof then held
hereunder to Grantor. The recitals of any facts in any release shall be conclusively deemed
true. To the extent permitted by law, the release may describe the grantee as “the person
or persons legally entitled thereto.” Lender shall have no duty to determine the rights of
persons claiming to be rightful grantees of any release. When the Property has been fully
released, the last such release shall operate as a reassignment of all future rents, issues
and profits of the Property to the person or persons legally entitled thereto.
Notwithstanding anything to the contrary contained in this Section 6.22, the release
of the Property shall not affect (i) any other Secured Obligations under the Loan Documents,
(ii) the Environmental Liabilities Agreement executed by Grantor of even date herewith, or
(iii) any guaranty now or hereafter executed with respect to the Loan (collectively or
severally as the context thereof may suggest or require).
	 
	6.23.	 	SUBROGATION. Lender shall be subrogated to the lien of all encumbrances, whether
released of record or not, paid in whole or in part by Lender pursuant to this Deed of Trust
or by the proceeds of any loan secured by this Deed of Trust.





ARTICLE 7 DEFAULT





	7.1.	 	DEFAULT. For all purposes hereof, “Default” shall mean either an
“Optional Default” (as defined below) or an “Automatic Default” (as defined
below).






	 	a.	 	Optional Default. An “Optional Default” shall occur, at
Lender’s option, upon the occurrence of any of the following events:






	 	(i)	 	Monetary. Grantor shall fail to (aa) pay when due any
sums which by their express terms require payment upon the expiration of a
specified notice and cure period or sums which are payable on the Maturity
Date, or (bb) pay any other sums payable under the Note, this Deed of Trust or
any of the other Loan Documents which failure remains uncured for five (5) days
after written notice thereof shall have been given to Grantor by Lender,
excluding with respect to (aa) or (bb) any monthly payment of principal or
interest due under the Note which is an Automatic Default as set forth in
Section 7.1.b.(i) of this Deed of Trust.
	 
	 	(ii)	 	Failure to Perform. Grantor shall fail to observe,
perform or discharge any of Grantor’s obligations, covenants, conditions or
agreements, other than Grantor’s payment obligations, under the Note, this Deed
of Trust or any of the other Loan Documents (including, without limitation, any
of the other mortgages and deeds of trust executed as part of the Loan
Documents and securing the Note), and (aa) such failure shall remain uncured
for thirty (30) days after written notice thereof shall have been given to
Grantor by Lender or (bb) if such failure is of such a nature that it cannot be
cured within such thirty (30) day period, Grantor shall fail to commence to
cure such failure within such thirty (30) day period or shall fail to
diligently prosecute such curative action thereafter.





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	 	(iii)	 	Representations and Warranties. Any representation,
warranty, certificate or other statement (financial or otherwise) made or
furnished by or on behalf of Grantor, or a guarantor, if any, to Lender or in
connection with any of the Loan Documents, or as an inducement to Lender to
make the Loan, shall be false, incorrect, incomplete or misleading in any
material respect when made or furnished.
	 
	 	(iv)	 	Seizure; Attachment. The seizure of any material
portion (as reasonably determined by Lender) of the Property; or the
sequestration or attachment of, or levy or execution upon any of the Property,
the Collateral or any other collateral provided by Grantor under any of the
Loan Documents, or any material portion of the other assets of Grantor, other
than a condemnation, which sequestration, attachment, levy or execution is not
released or dismissed within sixty (60) days after its occurrence; or the sale
of any assets effected pursuant to any of the foregoing (other than pursuant to
a condemnation).
	 
	 	(v)	 	Uninsured Casualty. The occurrence of an uninsured
casualty with respect to any material portion (as reasonably determined by
Lender) of the Property unless: (aa) no other Default has occurred and is
continuing at the time of such casualty or occurs thereafter; (bb) Grantor
promptly notifies Lender of the occurrence of such casualty; (cc) Tenant is
restoring the Property pursuant to the terms of the Lease or is consummating a
substitution pursuant to the terms of the Lease; and (dd) if Tenant is not
restoring the Property pursuant to the terms of the Lease and an Event of
Default exists under the Lease by virtue of such failure to restore, Grantor
shall within forty-five (45) days thereafter, deliver to Lender immediately
available funds in an amount sufficient, in Lender’s reasonable opinion, to pay
all costs of the repair or restoration (including, without limitation, taxes,
financing charges, insurance and rent during the repair period). So long as no
Default has occurred and is continuing at the time of Lender’s receipt of such
funds and no Default occurs thereafter, but subject to the rights of Tenant
under any Lease, Lender shall make such funds available for the repair or
restoration of the Property. Notwithstanding the foregoing, but subject to the
rights of Tenant under any Lease, Lender shall have no obligation to make funds
available for repair or restoration of the Property unless and until all the
conditions set forth in clauses (bb) and (cc) of Section 6.11.b.(iii)
of this Deed of Trust have been satisfied. Grantor acknowledges that the
specific conditions described above are reasonable.
	 
	 	(vi)	 	Lease. With respect to a Lease, Grantor defaults under
Section 3.4.b. of this Deed of Trust or a Lease Default occurs under
any Lease, and such default or Lease Default remains uncured for thirty (30)
days after written notice thereof shall have been given by Lender to Grantor.






	 	b.	 	Automatic Default. An “Automatic Default” shall occur
automatically upon the occurrence of any of the following events:





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	 	(i)	 	Monetary. Grantor shall fail to pay when due any
monthly payment of principal and interest due under the Note and no funds are
in the Restricted Account (as defined in the Cash Management Agreement) to make
such payment when due; provided, that, no Automatic Default shall be deemed to
have occurred if Grantor’s failure to pay results solely from Lender’s failure
to timely initiate an ACH debit.
	 
	 	(ii)	 	Voluntary Bankruptcy, Insolvency, Dissolution. (aa)
Grantor’s filing a petition for relief under the Bankruptcy Reform Act of 1978,
as amended or recodified (“Bankruptcy Code”), or under any other
present or future state or federal law regarding bankruptcy, reorganization or
other relief to debtors (collectively, “Debtor Relief Law”); or (bb)
Grantor’s filing any pleading in any involuntary proceeding under the
Bankruptcy Code or other Debtor Relief Law which admits to the petition’s
material allegations regarding Grantor’s insolvency; or (cc) Grantor’s making a
general assignment for the benefit of creditors; or (dd) Grantor’s applying
for, or the appointment of, a receiver, trustee, custodian or liquidator of
Grantor or any of its property; or (ee) the filing by or on behalf of Grantor
of a voluntary petition seeking the liquidation or dissolution of Grantor or
the commencement of any other procedure by or on behalf of Grantor to liquidate
or dissolve Grantor.
	 
	 	(iii)	 	Involuntary Bankruptcy. Grantor’s failure to effect a
full dismissal of any involuntary petition under the Bankruptcy Code or other
Debtor Relief Law, or any other procedure to liquidate or dissolve Grantor,
that is filed against Grantor or in any way restrains or limits Grantor or
Lender regarding the Loan or the Property, prior to the earlier of the entry of
any order granting relief sought in the involuntary petition or ninety (90)
days after the date of filing of the petition.
	 
	 	(iv)	 	Partners, Guarantors. The occurrence of an event
specified in Sections (ii) or (iii) as to Grantor, any general partner or any
member of Grantor, as applicable, or any guarantor obligated to Lender under
the Loan Documents.






	7.2.	 	ACCELERATION. Upon the occurrence of an Optional Default, Lender may, at its option,
declare all sums owing to Lender under the Note and the other Loan Documents immediately due
and payable. Upon the occurrence of an Automatic Default, all sums owing to Lender under the
Note and the other Loan Documents shall automatically become immediately due and payable.
	 
	7.3.	 	RIGHTS AND REMEDIES. In addition to the rights and remedies in Section 7.2
above, at any time after a Default, Lender shall have all of the following rights and
remedies:






	 	a.	 	Entry on Property. Subject to the rights of Tenant under any Lease,
Lender shall have the right to enter upon the Property from time to time, with or
without notice, and without releasing Grantor from any Secured Obligation, and without
becoming a grantee in possession, and do such other acts and things as Lender deems
necessary or desirable in order to inspect, investigate, assess and protect the
security hereof or to cure any Default;





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	 	b.	 	Appointment of Receiver. Lender shall have the right to apply to a
court of competent jurisdiction for and obtain appointment of a receiver, trustee,
liquidator or conservator of the Property, with or without notice of hearing, for any
purpose, including, without limitation, to enforce Lender’s rights to collect Payments
and to enter on and inspect the Property for Hazardous Materials, as a matter of strict
right and without regard to: (i) the adequacy of the security for the repayment of the
Secured Obligations; (ii) the existence of a declaration that the Secured Obligations
are immediately due and payable; (iii) the filing of a notice of default; or (iv) the
solvency of Grantor, or any guarantor or other person or entity in any manner obligated
to Lender under the Loan Documents;
	 
	 	c.	 	Foreclosure.






	 	(i)	 	Trustee may take possession of and sell the Property, or any
part thereof requested by Lender to be sold, and in connection therewith
Grantor hereby (A) assents to the passage of a decree for the sale of the
Property by the equity court having jurisdiction, and (B) authorizes and
empowers Trustee to take possession of and sell (or in case of the default of
any purchaser to resell) the Property, or any part thereof, all in accordance
with the laws or rules of court of the Commonwealth of Virginia relating to
deeds of trust, including any amendments thereof, or additions thereto, which
do not materially change or impair the remedy. In connection with any
foreclosure, Lender and/or Trustee may (y) procure such title reports, surveys,
tax histories and appraisals as they deem necessary, and (z) make such repairs
and additions to the Property as they deem advisable, all of which shall
constitute “Expenses” (hereinafter defined). In the case of any sale
under this Deed of Trust, by virtue of judicial proceedings or otherwise, the
Property may be sold as an entirety or in parcels, by one (1) sale or by
several sales, and any fixtures or Collateral encumbered by this Deed of Trust
may be sold at the same sale as the Property or in one (1) or more sales, as
may be deemed by Trustee to be appropriate and without regard to any right of
Grantor or any other person to the marshalling of assets, for cash, on credit
or for other property, for immediate or future delivery, and for such price or
prices and on such terms having first given such notice prior to the sale of
such time, place and terms by publication in at least one (1) newspaper
published or having general circulation in the county or counties in which the
Property is located or at such time or times as may be required by the laws of
the Commonwealth of Virginia or rule of court of the Commonwealth of Virginia,
and such other times and by such other methods, if any, as Trustee, in its sole
discretion, shall deem advantageous and proper. “Expenses” means all
costs and expenses of any nature whatsoever incurred at any time and from time
to time (whether before or after a Default) by Lender or Trustee in exercising
or enforcing any rights, powers and remedies provided in this Deed of Trust or
any of the other Loan Documents, including, without limitation, reasonable
attorney’s fees, court costs, receiver’s fees, management fees and costs
incurred in the repair, maintenance and operation of, or taking possession of,
or selling, the Property.
	 
	 	(ii)	 	Any sale hereunder may be made at public auction, at such time
or times, at such place or places, and upon such terms and conditions and after
such previous





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	 	 	 	public notice as Trustee shall deem appropriate and advantageous and as
required by the laws of the Commonwealth of Virginia.
	 
	 	(iii)	 	Upon the terms of such sale being complied with, Trustee shall
convey to, and at the cost of, the purchaser or purchasers the interest of
Grantor in the Property so sold, free and discharged of and from all estate,
title or interest of Grantor, at law or in equity, such purchaser or purchasers
being hereby discharged from all liability to see to the application of the
purchase money.
	 
	 	(iv)	 	Lender and any affiliate thereof may be a purchaser of the
Property or of any part thereof or of any interest therein at any public sale
thereof, whether pursuant to foreclosure or power of sale or otherwise
hereunder, without forfeiting its right to collect any deficiency from Grantor;
and Lender may apply upon the purchase price the Secured Obligations secured
hereby owing to Lender. Lender, upon any such purchase, shall acquire good
title to the properties so purchased, free of the lien of this Deed of Trust
and free of all rights of redemption in Grantor and free of all liens and
encumbrances subordinate to this Deed of Trust.






	 	d.	 	Statutory Provisions. This Deed of Trust is made under and pursuant to
the provisions of the Code of Virginia, Sections 55-58.1, 55-58.2, 55-59, 55-59.1
through 55-59.4 and 55-60, as amended, and shall be construed to impose and confer upon
the parties hereto and Lender all the rights, duties, and obligations prescribed by
said Sections 55-58.1, 55-58.2, 55-59, 55-59.1 through 55-59.4 and 55-60, as amended,
except as herein otherwise restricted, expanded or changed, including without
limitation the following rights, duties and obligations described in short form:






	 	(i)	 	All exemptions are hereby waived.
	 
	 	(ii)	 	Subject to call on default.
	 
	 	(iii)	 	Renewal, extension, or reinstatement permitted.
	 
	 	(iv)	 	Substitution of Trustees collectively or of any of them
individually by the Lender is permitted for any reason whatsoever, and any
number of times without exhaustion of the right to do so.
	 
	 	(v)	 	Advertisement required, once a week for two successive weeks in
any newspaper of general circulation in the County or City in which the
Property is situate.
	 
	 	(vi)	 	Any Trustee may act.
	 
	 	(vii)	 	The Trustee may require a deposit in the amount of two percent
(2%) of the unpaid principal indebtedness then secured hereby or Fifty Thousand
Dollars ($50,000.00), whichever is greater, to accompany each bid at
foreclosure sale or sale in lieu thereof.





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	 	e.	 	Multiple Foreclosures. To resort to and realize upon the security
hereunder and any other security now or later held by Lender concurrently or
successively and in one or several consolidated or independent judicial actions or
lawfully taken non-judicial proceedings, or both, and to apply the proceeds received
upon the Secured Obligations all in such order and manner as Trustee and Lender or
either of them determine in their sole discretion;
	 
	 	f.	 	Rights to Collateral. To exercise all rights Trustee or Lender may
have with respect to the Collateral under this Deed of Trust, the UCC or otherwise at
law; and
	 
	 	g.	 	Other Rights. To exercise such other rights as Lender may have at law
or in equity or pursuant to the terms and conditions of this Deed of Trust or any of
the other Loan Documents.
	 
	 	h.	 	Uniform Commercial Code. Without limitation of Lender’s rights of
enforcement with respect to the Collateral or any part thereof in accordance with the
procedures for foreclosure of real estate, Lender may exercise its rights of
enforcement with respect to the Collateral or any part thereof under the UCC (or under
the Uniform Commercial Code in force in any other state to the extent the same is
applicable law) and in conjunction with, in addition to or in substitution for those
rights and remedies: (1) Lender may enter upon Grantor’s premises to take possession
of, assemble and collect the Collateral or, to the extent and for those items of the
Collateral permitted under applicable law, to render it unusable; (2) Lender may
require Grantor to assemble the Collateral and make it available at a place Lender
designates which is mutually convenient to allow Lender to take possession or dispose
of the Collateral; (3) written notice mailed to Grantor as provided herein at least ten
(10) days prior to the date of public sale of the Collateral or prior to the date after
which private sale of the Collateral will be made shall constitute reasonable notice;
(4) any sale made pursuant to the provisions of this paragraph shall be deemed to have
been a public sale conducted in a commercially reasonable manner if held
contemporaneously with and upon the same notice as required for the sale of the
Property under power of sale as provided in Section 7.3c hereinabove; (5) in
the event of a foreclosure sale, whether made by Trustee under the terms hereof, or
under judgment of a court, the Collateral and the other Property may, at the option of
Lender, be sold as a whole; (6) it shall not be necessary that Lender take possession
of the Collateral or any part thereof prior to the time that any sale pursuant to the
provisions of this Section is conducted and it shall not be necessary that the
Collateral or any part thereof be present at the location of such sale; (7) with
respect to application of proceeds from disposition of the Collateral under Section
7.3c hereinabove, the costs and expenses incident to disposition shall include the
reasonable expenses of retaking, holding, preparing for sale or lease, selling, leasing
and the like and the reasonable attorneys’ fees and legal expenses incurred by Lender;
(8) any and all statements of fact or other recitals made in any bill of sale or
assignment or other instrument evidencing any foreclosure sale hereunder as to
nonpayment of the Secured Obligations or as to the occurrence of any default, or as to
Lender having declared all of such indebtedness to be due and payable, or as to notice
of time, place and terms of sale and of the properties to be sold having been duly
given, or as to any other act or thing having been duly done by Lender, shall be taken
as prima facie evidence of the truth of the facts so stated and





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	 	 	 	recited; and (9) Lender may appoint or delegate any one or more persons as agent to
perform any act or acts necessary or incident to any sale held by Lender, including
the sending of notices and the conduct of the sale, but in the name and on behalf of
Lender.






	 	 	In connection with any sale or sales hereunder, Lender may elect to treat any of the
Property which consists of a right in action or which is property that can be severed from
the Property (including, without limitation, any improvements forming a part thereof)
without causing structural damage thereto as if the same were personal property or a
fixture, as the case may be, and dispose of the same in accordance with applicable law,
separate and apart from the sale of the Property.
	 
	7.4.	 	APPLICATION OF FORECLOSURE SALE PROCEEDS. The proceeds of such sale or sales under
this Deed of Trust, whether under the assent to a decree, the power of sale, or by equitable
foreclosure, shall be held by Trustee and applied as follows: FIRST, to pay (A) all Expenses
incurred in connection with such sale or in preparing the Property for such sale and of
obtaining possession including, among other things, reasonable counsel fees shall be allowed
and paid out of the proceeds of such sale or sales as the court having jurisdiction may deem
proper, (B) a reasonable commission and expenses to the Trustee, and (C) all taxes, levies,
assessments or other charges relating to the Property which have or in the opinion of Trustee
may have, priority over the lien of this Deed of Trust, including the pro rata portion thereof
applicable to the taxable period during which any payment is made pursuant to this subsection;
SECOND, to pay all of the Secured Obligations and all interest then due and accrued thereon,
which shall include interest through the date of ratification of the auditor’s account; THIRD,
to pay the amount of any liens of record inferior to this Deed of Trust, together with lawful
interest, and lawful claims of third parties against the proceeds of any sale; and LASTLY, to
pay the surplus, if any, to Grantor or any person or entity entitled thereto unless otherwise
required by law or directed by a court of competent jurisdiction. In the event that the
proceeds of any such sale or sales, together with all other monies at the time held by Trustee
under this Deed of Trust, are insufficient to pay the foregoing costs and expenses, Lender
may, at its sole option, advance such sums as Lender in its sole and absolute discretion shall
determine for the purpose of paying all or any part of such costs and expenses, and all such
sums so advanced shall be (A) a lien against the Property, (B) added to the amount due under
the Note and secured by this Deed of Trust, and (C) payable on demand with interest at the
rate of interest applicable to the principal balance of the Note, from and including the date
each such advance is made. In any event, Grantor shall be liable to Lender for any deficiency
if the proceeds of any such sale or sales are insufficient to pay, in full, all amounts to be
distributed pursuant to the clauses FIRST through SECOND above.
	 
	7.5.	 	WAIVER OF MARSHALING RIGHTS. Grantor, for itself and for all parties claiming
through or under Grantor, and for all parties who may acquire a lien on or interest in the
Property or the Collateral, hereby waives all rights to a sale in inverse order of alienation
or to have the Property and/or any other property, including, without limitation, the
Collateral, which is now or later may be security for any Secured Obligation, marshaled upon
any foreclosure of this Deed of Trust or on a foreclosure of any other security for any of the
Secured Obligations.
	 
	7.6.	 	NO CURE OR WAIVER. Neither Lender’s nor Trustee’s nor any receiver’s entry upon and
taking possession of all or any part of the Property, nor any collection of rents, issues,
profits, insurance proceeds, condemnation proceeds or damages, other security or proceeds of
other security, or other sums, nor the application of any collected sum to any Secured
Obligation, nor the





DEED OF TRUST (VIRGINIA)

Wells Fargo/Cole Properties/Cracker Barrel

Loan No. 02-62113748/Store No. 568




37









 






	 	 	exercise of any other right or remedy by Lender or Trustee or any receiver shall cure or
waive any Default or notice of default under this Deed of Trust, or nullify the effect of
any notice of default or sale (unless all Secured Obligations then due have been paid or
performed and Grantor has cured all other Defaults hereunder), or impair the status of the
security, or prejudice Lender or Trustee in the exercise of any right or remedy, or be
construed as an affirmation by Lender of any tenancy, lease or option or a subordination of
the lien of this Deed of Trust.
	 
	7.7.	 	PAYMENT OF COSTS, EXPENSES AND ATTORNEYS’ FEES. Grantor agrees to pay to Lender
immediately and upon demand all costs and expenses incurred by Trustee and Lender in the
enforcement of the terms and conditions of this Deed of Trust (including, without limitation,
statutory trustee’s fees, court costs and reasonable attorneys’ fees, whether incurred in
litigation or not) with interest from the date of expenditure until said sums have been paid
at the rate of interest applicable to the principal balance of the Note as specified therein.
	 
	7.8.	 	POWER TO FILE NOTICES AND CURE DEFAULTS. Grantor hereby irrevocably appoints Lender
and its successors and assigns, as its attorney-in-fact, which agency is coupled with an
interest, to perform any obligation of Grantor hereunder upon the occurrence of an event, act
or omission which, with notice or passage of time or both, would constitute a Default,
provided, however, that: (a) Lender as such attorney-in-fact shall only be
accountable for such funds as are actually received by Lender; and (b) Lender shall not be
liable to Grantor or any other person or entity for any failure to act under this Section.
	 
	7.9.	 	REMEDIES CUMULATIVE. All rights and remedies of Lender and Trustee under this Deed
of Trust and the other Loan Documents are cumulative and are in addition to all rights and
remedies provided by applicable law (including specifically that of foreclosure of this Deed
of Trust as though it were a mortgage). Lender may enforce any one or more remedies or rights
under the Loan Documents either successively or concurrently.





ARTICLE 8 MISCELLANEOUS PROVISIONS





	8.1.	 	CONSENTS AND APPROVAL. Wherever Lender’s consent, approval, acceptance or
satisfaction is required under any provision of this Deed of Trust or any of the other Loan
Documents, such consent, approval, acceptance or satisfaction shall not be unreasonably
withheld, conditioned or delayed by Lender unless such provision expressly provides otherwise.
	 
	8.2.	 	ATTORNEYS’ FEES. If any legal action, suit or proceeding is commenced between Grantor
and Lender regarding their respective rights and obligations under any Loan Document, the
prevailing party shall be entitled to recover, in addition to damages or other relief, costs
and expenses, reasonable attorneys’ fees and court costs (including, without limitation,
expert witness fees).
	 
	8.3.	 	PERMITTED CONTESTS. After prior written notice to Lender, Grantor may contest, by
appropriate legal or other proceedings conducted in good faith and with due diligence, the
amount, validity or application, in whole or in part, of any lien, levy, tax or assessment, or
any lien of any laborer, mechanic, materialman, supplier or vendor, or the application to
Grantor or the Property of any law or the validity thereof (each a “Contested
Matter”), the assertion or imposition of which, or the failure to pay when due, would
constitute a Default; provided that (a) Grantor pursues the contest diligently, in a manner
which Lender determines is not prejudicial to





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	 	 	Lender, and does not impair the lien of this Deed of Trust upon the Property; (b) the
Property, or any part hereof or estate or interest therein, shall not be in any danger of
being sold, forfeited or lost by reason of such proceedings; (c) in the case of the contest
of any law or other legal requirement, Lender shall not be in any danger of any civil or
criminal liability; and (d) if required by Lender, Grantor deposits with Lender any funds or
other forms of assurance (including a bond or letter of credit) satisfactory to Lender to
protect Lender from the consequences of the contest being unsuccessful. Grantor’s right to
contest pursuant to the terms of this provision shall in no way relieve Grantor of its
obligations under the Loan or to make payments to Lender as and when due. The Tenant under
any Lease shall also have the right to contest any Contested Matter in accordance with the
terms of such Lease.
	 
	8.4.	 	GRANTOR AND GRANTEE DEFINED. The term “Grantor” includes both the original Grantor
and any subsequent owner or owners of any of the Property, and the term “Lender” includes the
original Lender and any future owner or holder, including assignees, pledges and participants,
of the Note or any interest therein.
	 
	8.5.	 	DISCLAIMERS.






	 	a.	 	Relationship. The relationship of Grantor and Lender under this Deed
of Trust and the other Loan Documents is, and shall at all times remain, solely that of
borrower and lender, and Lender neither undertakes nor assumes any responsibility or
duty to Grantor or to any third party with respect to the Property. Notwithstanding
any other provisions of this Deed of Trust and the other Loan Documents: (i) Lender is
not, and shall not be construed to be, a partner, joint venturer, member, alter ego,
manager, controlling person or other business associate or participant of any kind of
Grantor, and Lender does not intend to ever assume such status; and (ii) Lender shall
not be deemed responsible for or a participant in any acts, omissions or decisions of
Grantor.
	 
	 	b.	 	No Liability. Lender shall not be directly or indirectly liable or
responsible for any loss, claim, cause of action, liability, indebtedness, damage or
injury of any kind or character to any person or property arising from any construction
on, or occupancy or use of, the Property, whether caused by or arising from: (i) any
defect in any building, structure, grading, fill, landscaping or other improvements
thereon or in any on-site or off-site improvement or other facility therein or thereon;
(ii) any act or omission of Grantor or any of Grantor’s agents, employees, independent
contractors, licensees or invitees; (iii) any accident in or on the Property or any
fire, flood or other casualty or hazard thereon; (iv) the failure of Grantor or any of
Grantor’s licensees, employees, invitees, agents, independent contractors or other
representatives to maintain the Property in a safe condition; or (v) any nuisance made
or suffered on any part of the Property.





DEED OF TRUST (VIRGINIA)

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	8.6.	 	SEVERABILITY. If any term of any Loan Document, or the application thereof to any
person or circumstances, shall, to any extent, be invalid or unenforceable, the remainder of
the Loan Document, or the application of such term to persons or circumstances other than
those as to which it is invalid or unenforceable, shall not be affected thereby, and each term
of the Loan Document shall be valid and enforceable to the fullest extent permitted by law.
	 
	8.7.	 	JOINT AND SEVERAL LIABILITY. If more than one person has executed this Deed of Trust
as “Grantor,” the obligations of all such persons hereunder shall be joint and several.
	 
	8.8.	 	SEPARATE AND COMMUNITY PROPERTY. Any married person who executes this Deed of Trust
as a “Grantor” agrees that any money judgment which Lender obtains pursuant to the terms of
this Deed of Trust or any other obligation of that married person secured by this Deed of
Trust may be collected by execution upon any separate property or community property of that
person.
	 
	8.9.	 	INTEGRATION; INTERPRETATION. The Loan Documents contain or expressly incorporate by
reference the entire agreement of the parties with respect to the matters contemplated therein
and supersede all prior negotiations or agreements, written or oral. The Loan Documents shall
not be modified, except by written instrument executed by all parties. Any reference in any
of the Loan Documents to the Property or Collateral shall include all or any part of the
Property or Collateral. Any reference to the Loan Documents includes any amendments, renewals
or extensions now or hereafter approved by Lender in writing. When the identity of the
parties or other circumstances make it appropriate, the masculine gender includes the feminine
and/or neuter, and the singular number includes the plural.
	 
	8.10.	 	CAPITALIZED TERMS. Capitalized terms not otherwise defined herein shall have the
meanings set forth in the Note.
	 
	8.11.	 	SUCCESSORS IN INTEREST. The terms, covenants, and conditions contained herein and
in the other Loan Documents shall be binding upon and inure to the benefit of the heirs,
successors and assigns of the parties. The foregoing sentence shall not be construed to
permit Grantor to assign the Loan, except as otherwise permitted under the Note or the other
Loan Documents.
	 
	8.12.	 	GOVERNING LAW. This Deed of Trust was accepted by Lender in the state of New York,
which state the parties agree has a substantial relationship to the parties to the underlying
transaction embodied hereby. Accordingly, in all respects, including, without limiting the
generality of the foregoing, matters of construction, validity, enforceability and
performance, this Deed of Trust, the Note and the other Loan Documents and the obligations
arising hereunder and thereunder shall be governed by, and construed in accordance with, the
laws of the state of New York applicable to contracts made and performed in such state and any
applicable law of the United States of America, except that at all times the provisions for
enforcement of all remedies granted hereunder and the creation, perfection and enforcement of
the liens and security interests created pursuant hereto and to the other Loan Documents in
any Collateral which is located in the state where the Property is located shall be governed
by and construed, according to the law of the state where the Property is located except to
the extent that under the UCC perfection may be governed by the laws of a different
jurisdiction. Except as provided in the immediately preceding sentence, Grantor hereby
unconditionally and irrevocably waives, to the fullest extent permitted





DEED OF TRUST (VIRGINIA)

Wells Fargo/Cole Properties/Cracker Barrel

Loan No. 02-62113748/Store No. 568




40









 






	 	 	by law, any claim to assert that the law of any jurisdiction other than New York governs
this Deed of Trust, the Note and other Loan Documents.
	 
	8.13.	 	CONSENT TO JURISDICTION. Grantor irrevocably submits to the jurisdiction of: (a)
any state or federal court sitting in the state of New York over any suit, action, or
proceeding, brought by Grantor against Lender, arising out of or relating to this Deed of
Trust, the Note or the Loan; (b) any state or federal court sitting in the state where the
Property is located or the state in which Grantor’s principal place of business is located
over any suit, action or proceeding, brought by Lender against Grantor, arising out of or
relating to this Deed of Trust, the Note or the Loan; and (c) any state court sitting in the
county of the state where the Property is located over any suit, action, or proceeding,
brought by Lender to enforce its rights with respect to the Collateral. Grantor irrevocably
waives, to the fullest extent permitted by law, any objection that Grantor may now or
hereafter have to the laying of venue of any such suit, action, or proceeding brought in any
such court and any claim that any such suit, action, or proceeding brought in any such court
has been brought in an inconvenient forum.
	 
	8.14.	 	EXHIBITS. Exhibit A is incorporated into this Deed of Trust by this
reference as if fully set forth herein.
	 
	8.15.	 	ADDRESSES; REQUEST FOR NOTICE. All notices and other communications that are
required or permitted to be given to a party under this Deed of Trust or the other Loan
Documents shall be in writing, refer to the Loan number, and shall be sent to such party,
either by personal delivery, by overnight delivery service, by certified first class mail,
return receipt requested, or by facsimile transmission to the addressee or facsimile number
below. All such notices and communications shall be effective upon receipt of such delivery
or facsimile transmission. The addresses of the parties are set forth on Page 1 of this Deed
of Trust and the facsimile numbers for the parties are as follows:
	 
	 	 	Lender:
	 
	 	 	WELLS FARGO BANK, NATIONAL ASSOCIATION

FAX No.: (760) 918-2727
	 
	 	 	Grantor:
	 
	 	 	COLE CB WAYNESBORO VA, LLC

FAX No.: (602) 778-8780
	 
	 	 	Grantor’s principal place of business is at the address set forth on Page 1 of this Deed of
Trust.
	 
	 	 	Any Grantor whose address is set forth on Page 1 of this Deed of Trust hereby requests that
a copy of notice of default and notice of sale be delivered to it at that address. Failure
to insert an address shall constitute a designation of Grantor’s last known address as the
address for such notice. Any party shall have the right to change its address for notice
hereunder to any other location within the continental United States by giving thirty (30)
days notice to the other parties in the manner set forth above.





DEED OF TRUST (VIRGINIA)

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Loan No. 02-62113748/Store No. 568




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	8.16.	 	COUNTERPARTS. This Deed of Trust may be executed in any number of counterparts,
each of which, when executed and delivered, will be deemed an original and all of which taken
together, will be deemed to be one and the same instrument.
	 
	8.17.	 	WAIVER OF JURY TRIAL. GRANTEE AND GRANTOR HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION
BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS DEED OF TRUST OR ANY OTHER
LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR
WRITTEN) OR ACTIONS OF GRANTEE OR GRANTOR. THIS PROVISION IS A MATERIAL INDUCEMENT FOR
GRANTEE TO ENTER INTO THIS DEED OF TRUST.
	 
	8.18.	 	NON-WAIVER. By accepting payment of any amount secured hereby after its due date or
late performance of any other Secured Obligation, Lender shall not waive its right against any
person obligated directly or indirectly hereunder or on any Secured Obligation, either to
require prompt payment or performance when due of all other sums and obligations so secured or
to declare default for failure to make such prompt payment or performance. No exercise of any
right or remedy by Lender hereunder shall constitute a waiver of any other right or remedy
herein contained or provided by law. No failure by Lender to exercise any right or remedy
hereunder arising upon any Default shall be construed to prejudice Lender’s rights or remedies
upon the occurrence of any other or subsequent Default. No delay by Lender in exercising any
such right or remedy shall be construed to preclude Lender from the exercise thereof at any
time while that Default is continuing. No notice to nor demand on Grantor shall of itself
entitle Grantor to any other or further notice or demand in similar or other circumstances.
	 
	8.19.	 	FURTHER ASSURANCES. Grantor shall, upon demand by Lender, execute, acknowledge (if
appropriate) and deliver any and all documents and instruments and do or cause to be done all
further acts reasonably necessary or appropriate to effectuate the purposes of the Loan
Documents and to perfect any assignments contained therein.
	 
	8.20.	 	RELATIONSHIP OF ARTICLES. The rights, remedies and interests of Lender under this
Deed of Trust established by Article 1 and the security agreement established by
Article 4 are independent and cumulative, and there shall be no merger of any lien
created by this Deed of Trust with any security interest created by the security agreement.
Lender may elect to exercise or enforce any of its rights, remedies or interests under either
or both this Deed of Trust or the security agreement as Lender may from time to time deem
appropriate. The absolute assignment of rents and leases established by Article 3 is
similarly independent of and separate from this Deed of Trust and the security agreement.
	 
	8.21.	 	MERGER. No merger shall occur as a result of Lender’s acquiring any other estate
in, or any other lien on, the Property unless Lender consents to a merger in writing.
	 
	8.22.	 	CROSS-DEFAULT; CROSS-COLLATERALIZATION. The Note is secured by, among other things,
this Deed of Trust and those certain other Mortgages, Deeds of Trust, and/or Deeds to Secure
Debt of even date herewith, executed by the mortgagor, trustor or grantor, as the case may be,
in favor of Lender and covering certain real property and improvements and personal





DEED OF TRUST (VIRGINIA)

Wells Fargo/Cole Properties/Cracker Barrel

Loan No. 02-62113748/Store No. 568




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	 	 	property thereon as described therein and located as described on Schedule I hereof
(the “Other Mortgages”). The existence of a Default under this Deed of Trust (after
the expiration of any applicable notice and cure periods) shall be deemed and shall
constitute an Automatic Default under the Other Mortgages (without any further notice and
cure by Lender to Grantor which is hereby specifically waived by Grantor for all purposes),
and a Default under any of the Other Mortgages (after the expiration of any applicable
notice and cure periods), shall be deemed and shall constitute an Automatic Default under
this Deed of Trust and the remaining Other Mortgages (without any further notice and cure by
Lender to Grantor which is hereby specifically waived by Grantor for all purposes).
	 
	8.23.	 	USA PATRIOT ACT NOTIFICATION. Lender hereby notifies Grantor that, pursuant to the
requirements of the Patriot Act, it is required to obtain, verify and record information that
identifies Grantor, which information includes the name and address of Grantor and other
information that will allow Lender to identify Grantor in accordance with the Patriot Act.





[The remainder of this page intentionally left blank.]




DEED OF TRUST (VIRGINIA)

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     EXECUTED as of the date first written above with the intent that this be deemed an instrument
executed under seal.



	 	 	 	 	 	 	 
	 	 	 GRANTOR: 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	COLE CB WAYNESBORO VA, LLC,	 	 
	 	 	a Delaware limited liability company	 	 
	 
	 	 	 	 	 	 
	 	 	By: Cole REIT Advisors III, LLC,

a Delaware limited liability company,

its manager	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Todd J. Weiss
 

	 	 
	 

	 	 	 	Name: Todd J. Weiss	 	 
	 

	 	 	 	Title: Vice President	 	 






	 	 	 
	STATE OF

	 	ARIZONA
	COUNTY OF

	 	MARICOPA





The foregoing instrument was acknowledged before me on August 28, 2009, by TODD J. WEISS,
the Vice President of Cole REIT Advisors III, LLC, a Delaware limited liability company,
the manager of Cole CB WAYNESBORO VA, LLC, a Delaware limited liability company, on behalf
of said limited liability company.




	 	 	 	 	 
	 [Notary
Seal]

	 	/s/ Mary D. Bates
 

Notary Public, State of ARIZONA
	 	 
	 

	 	Printed Name: Mary D. Bates	 	 
	 

	 	My Commission Expires: September 3, 2012	 	 






DEED OF TRUST (VIRGINIA)

Wells Fargo/Cole Properties/Cracker Barrel

Loan No. 02-62113748/Store No. 568




 









 





Loan No. 02-62113748




EXHIBIT A




DESCRIPTION OF LAND




Unit No.: 568




Property Address: 101 Appletree Lane, Waynesboro, Virginia



Description of Land. The Land referred to in this Assignment is situated in the City of
Waynesboro, State of Virginia and is described as follows:





	 	 	 	Situated, lying and being all that certain piece or parcel of land located in the City of
Waynesboro, Virginia, said parcel being New Lot 2 as shown on a survey by Timmons Group dated May
27, 2004 and entitled Simple Subdivision being a Resubdivision of Lots 2 and 3, Orchard Road Plaza,
of record in the Clerk’s Office of the Circuit Court of the City of Waynesboro, Virginia in Plat
Book 7, page 66; more particularly described as follows:
	 
	 	 	 	Commencing at a set rod lying at the intersection of the Western right of way line of Apple Tree
Lane and the Southern right of way line of Red Top Orchard Road, said point being the true point
and place of beginning; thence along the said right of way line of Apple Tree Lane with a curve to
the left having a radius of 205.00 feet, an arc length of 75.16 feet, an interior angle of
21°00’24”, a chord bearing of South
08°20’10” West and a chord distance of 74.74 feet to a set rod;
thence South 02°10’02” East a distance of 247.11 feet to a set rod; thence along a curve to the
right having a radius of 145.00 feet, an arc length of 233.66 feet,
an interior angle of 88°22’45”,
a chord bearing of South 42°01’20” West and a chord distance of 202.14 feet to a set rod; thence
along a curve to the right having a radius of 1312.69 feet, an arc length of 66.74 feet, an
interior angle of 02°54’47”, a chord bearing of South
87°40’06” West and a chord distance of 66.73
feet to a set rod; thence South 89°07’29” West a
distance of 74.31 feet to a set rod; thence
leaving said right of way North 02°10’02” West a distance of 405.95 feet to a set rod; thence North
59°10’44” East a distance of 272.47 feet to a found concrete monument, said concrete monument lying
on the Southern right of way line of Red Top Orchard Road; thence along said right of way line with
a curve to the left having a radius of 435.14 feet, an arc length of
92.09 feet, an interior angle
of 12°07’32”, a chord bearing of South 40°02’50” East and a chord distance of 91.92 feet to a set
rod, said rod being the true point and place of beginning.
	 
	 	 	 	Containing 130,671.179 square feet; 3.000 acres, more or less
	 
	 	 	 	Tax Map No. 50-(3)-2
	 
	 	 	 	Being the same property conveyed to Cole CB Waynesboro VA, LLC, a Delaware limited liability
company from CBOCS, Inc., formerly known as Cracker Barrel Old Country Store, Inc. by deed dated
June 30, 2009 and recorded July 6, 2009 in the Clerk’s Office, Circuit Court, City of Waynesboro,
Virginia as Instrument No. 090001670.





DEED OF TRUST (VIRGINIA)

Wells Fargo/Cole Properties/Cracker Barrel

Loan No. 02-62113748/Store No. 568




 









 





SCHEDULE I




LIST OF OTHER MORTGAGES AND CROSS-COLLATERALIZED PROPERTIES





	1.	 	That certain Deed to Secure Debt and Absolute Assignment of Rents and Leases and Security
Agreement made by COLE CB Braselton GA, LLC, a Delaware limited liability company, as
borrower, in favor of Wells Fargo Bank, National Association, as lender, encumbering property
located at 301 Exchange Way, Braselton, Georgia.
	 
	2.	 	That certain Deed to Secure Debt and Absolute Assignment of Rents and Leases and Security
Agreement made by COLE CB Bremen GA, LLC, a Delaware limited liability company, as borrower,
in favor of Wells Fargo Bank, National Association, as lender, encumbering property located at
106 Price Creek Road, Bremen, Georgia.
	 
	3.	 	That certain Deed to Secure Debt and Absolute Assignment of Rents and Leases and Security
Agreement made by COLE CB Columbus GA, LLC, a Delaware limited liability company, as borrower,
in favor of Wells Fargo Bank, National Association, as lender, encumbering property located at
1500 Bradley Park Drive, Columbus, Georgia.
	 
	4.	 	That certain Deed of Trust and Absolute Assignment of Rents and Leases and Security Agreement
(and Fixture Filing) made by COLE CB Greensboro NC, LLC, a Delaware limited liability company,
as borrower, in favor of Wells Fargo Bank, National Association, as lender, encumbering
property located at 3701 Elmsley Court, Greensboro, North Carolina.
	 
	5.	 	That certain Deed of Trust and Absolute Assignment of Rents and Leases and Security Agreement
(and Fixture Filing) made by COLE CB Mebane NC, LLC, a Delaware limited liability company, as
borrower, in favor of Wells Fargo Bank, National Association, as lender, encumbering property
located at 135 Spring Forrest Drive, Mebane, North Carolina.
	 
	6.	 	That certain Deed of Trust and Absolute Assignment of Rents and Leases and Security Agreement
(and Fixture Filing) made by COLE CB Rocky Mount, LLC, a Delaware limited liability company,
as borrower, in favor of Wells Fargo Bank, National Association, as lender, encumbering
property located at 238 Enterprise Drive, Rocky Mount, North Carolina.
	 
	7.	 	That certain Mortgage and Absolute Assignment of Rents and Leases and Security Agreement (and
Fixture Filing) made by COLE CB Fort Mill SC, LLC, a Delaware limited liability company, as
borrower, in favor of Wells Fargo Bank, National Association, as lender, encumbering property
located at 295 Carowinds Boulevard, Fort Mill, South Carolina.
	 
	8.	 	That certain Mortgage and Absolute Assignment of Rents and Leases and Security Agreement (and
Fixture Filing) made by COLE CB Piedmont SC, LLC, a Delaware limited liability company, as
borrower, in favor of Wells Fargo Bank, National Association, as lender, encumbering property
located at 591 Highway 183, Piedmont, South Carolina.
	 
	9.	 	That certain Deed of Trust and Absolute Assignment of Rents and Leases and Security Agreement
(and Fixture Filing) made by COLE CB Abilene TX, LLC, a Delaware limited





DEED OF TRUST (VIRGINIA)

Wells Fargo/Cole Properties/Cracker Barrel

Loan No. 02-62113748/Store No. 568




 









 






	 	 	liability company, as borrower, in favor of Wells Fargo Bank, National Association, as
lender, encumbering property located at 1602 Highway 351, Abilene, Texas.
	 
	10.	 	That certain Deed of Trust and Absolute Assignment of Rents and Leases and Security Agreement
(and Fixture Filing) made by COLE CB San Antonio TX, LLC, a Delaware limited liability
company, as borrower, in favor of Wells Fargo Bank, National Association, as lender,
encumbering property located at 123 SW Loop 410, San Antonio, Texas.
	 
	11.	 	That certain Deed of Trust and Absolute Assignment of Rents and Leases and Security Agreement
(and Fixture Filing) made by COLE CB Sherman TX, LLC, a Delaware limited liability company, as
borrower, in favor of Wells Fargo Bank, National Association, as lender, encumbering property
located at 3501 N US Highway 75, Sherman, Texas.
	 
	12.	 	That certain Deed of Trust, Absolute Assignment of Rents and Leases and Security Agreement
(and Fixture Filing) made by COLE CB Bristol VA, LLC, a Delaware limited liability company, as
borrower, in favor of Wells Fargo Bank, National Association, as lender, encumbering property
located at 125 Village Circle, Bristol, Virginia.
	 
	13.	 	That certain Deed of Trust, Absolute Assignment of Rents and Leases and Security Agreement
(and Fixture Filing) made by COLE CB Emporia VA, LLC, a Delaware limited liability company, as
borrower, in favor of Wells Fargo Bank, National Association, as lender, encumbering property
located at 103 Sader Lane, Emporia, Virginia.
	 
	14.	 	That certain Deed of Trust, Absolute Assignment of Rents and Leases and Security Agreement
(and Fixture Filing) made by COLE CB Waynesboro VA, LLC, a Delaware limited liability company,
as borrower, in favor of Wells Fargo Bank, National Association, as lender, encumbering
property located at 101 Appletree Lane, Waynesboro, Virginia.
	 
	15.	 	That certain Deed of Trust, Absolute Assignment of Rents and Leases and Security Agreement
(and Fixture Filing) made by COLE CB Woodstock VA, LLC, a Delaware limited liability company,
as borrower, in favor of Wells Fargo Bank, National Association, as lender, encumbering
property located at 451 West Reservoir Road, Woodstock, Virginia.





Deed of Trust (Virginia)

Wells Fargo/DBAPPLEF — Applebee’s

Loan Nos.                      / Unit No. 568




2









 





DEED OF TRUST (VIRGINIA)

Wells Fargo/Cole Properties/Cracker Barrel

Loan No. 02-62113706/Store No. 614