Freddie Mac Loan Number 940972379

 

**MUILTIFAMILY NOTE**

**MULTISTATE - FIXED TO FLOAT**

**(REVISION DATE 03-30-2006)**

 

| US $2,540,000.00 | Effective Date: as of October 4, 2006 |
|------------------|---------------------------------------|

 

FOR VALUE RECEIVED, the undersigned (together with such party’s or parties’ successors and assigns, “Borrower”), jointly and severally (if more than one) promises to pay to the order of NorthMarq Capital, Inc., a Minnesota corporation, the principal sum of Two Million Five Hundred Forty Thousand and No/100 Dollars (US $2,540,000.00), with interest on the unpaid principal balance, as hereinafter provided.

 

1. Defined Terms.

 

|   | (a) | As used in this Note: |
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“**Adjustable Interest Rate**” means the variable annual interest rate calculated for each Interest Adjustment Period so as to equal the Index Rate for such Interest Adjustment Period (truncated at the fifth (5th) decimal place if necessary) plus the Margin.

 

“**Amortization Period**” means a period of 360 full consecutive calendar months.

 

“**Base Recourse**” means a portion of the Indebtedness equal to Zero percent (0%) of the original principal balance of this Note.

 

“**Business Day**” means any day other than a Saturday, a Sunday or any other day on which Lender or the national banking associations are not open for business.

 

“**Default Rate**” means (i) during the Fixed Rate Period, an annual interest rate equal to four (4) percentage points above the Fixed Interest Rate; and (ii) during the Extension Period, a variable annual interest rate equal to four (4) percentage points above the Adjustable Interest Rate in effect from time to time. However, at no time will the Default Rate exceed the Maximum Interest Rate.

 

“**Extended Maturity Date**” means, if the Extension Period becomes effective pursuant to this Note, the earlier of (i) November 1, 201 7 and (ii) the date on which the unpaid principal balance of this Note becomes due and payable by acceleration or otherwise pursuant to the Loan Documents or the exercise by Lender of any right or remedy thereunder.

 

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**“Extension Period”**means the twelve (12) consecutive calendar months period commencing on the Scheduled Initial Maturity Date.

 

**“Fixed Interest Rate”**means the annual interest rate of five and seventy seven hundredths percent (5.77%).

 

**“Fixed Rate Period”**means the period beginning on the date of this Note and continuing through October 31, 2016.

 

**“Index Rate”**means, for any Interest Adjustment Period, the Reference Bill® Index Rate for such Interest Adjustment Period.

 

**“Initial Maturity Date”**means the earlier of (i) November 1, 2016 (the 

 

**“Scheduled Initial Maturity Date”),**and (ii) the date on which the unpaid principal balance of this Note becomes due and payable by acceleration or otherwise pursuant to the Loan Documents or the exercise by Lender of any right or remedy thereunder.

 

**“Installment Due Date”**means, for any monthly installment of interest only or principal and interest, the date on which such monthly installment is due and payable pursuant to Section **3**of this Note. The **“First Installment Due Date”**under this Note is December 1, 2006.

 

**“Interest Adjustment Period”**means each successive one calendar month period during the Extension Period and until the entire Indebtedness is paid in full.

 

**“Lender”**means the holder from time to time of this Note.

 

**“LIBOR Index”**means the British Bankers Association’s (BBA) one (1) month LIBOR Rate for United States Dollar deposits, as displayed on the LIBOR Index Page used to establish the LIBOR Index Rate.

 

**“LIBOR Index Rate”**means, for any Interest Adjustment Period after the first Interest Adjustment Period, the BBA’s LIBOR Rate for the LIBOR Index released by the BBA most recently preceding the first day of such Interest Adjustment Period, as such LIBOR Rate is displayed on the LIBOR Index Page. The LIBOR Index Rate for the first Interest Adjustment Period means the British Bankers Association’s (BBA) LIBOR Rate for the LIBOR Index released by the BBA most recently preceding the first day of the month in which the first Interest 

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