ex107104multifamilynotewoods.htm


    


    MULTIFAMILY
NOTE

    MULTISTATE – FIXED TO
FLOAT

    (REVISION
DATE 2-15-2008)

    


    


    
      	
              US
      $8,097,000.00

            	
              Effective
      Date: June 30, 2008

            


    

    


    


    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 KEYCORP REAL ESTATE
CAPITAL MARKETS, INC., an Ohio corporation, the principal sum of Eight Million
Ninety-Seven Thousand and No/100 Dollars (US $8,097,000.00), with interest
on the unpaid principal balance, as hereinafter provided.

    


    1.           Defined Terms.

    


    (a)           As
used in this Note:

    


    "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.

    



    
      
         


      

      
        PAGE
- 1

        
          

        

      

      
         


        
          Freddie
Mac Loan Number 504111949

          Woods
at Eddy Pond

          


          


        

      

    


    "Extended Maturity Date" means,
if the Extension Period becomes effective pursuant to this Note, the earlier of
(i) July 1, 2019, 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.

    


    "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 six and sixty-five hundredths percent
(6.65%).

    


    "Fixed Rate Period" means the
period beginning on the date of this Note and
continuing through June 30, 2018.

    


    "Index Rate" means, for any
Interest Adjustment Period, the Reference Billâ  Index Rate for
such Interest Adjustment Period.

    


    "Initial Maturity Date"
means the earlier
of (i) July 1, 2018
(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 August 1, 2008.

    


    "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


    
      
         


      

      
        PAGE
- 2

        
          

        

      

      
         


        
          Freddie
Mac Loan Number 504111949

          Woods
at Eddy Pond

          


          


        

      

    


    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
Adjustment Period begins, as such LIBOR Rate is displayed on the LIBOR Index
Page.  "LIBOR Index
Page" is the Bloomberg L.P., page "BBAM", or such other page for the
LIBOR Index as may replace page BBAM on that service, or at the option of Lender
(i) the applicable page for the LIBOR Index on another service which
electronically transmits or displays BBA LIBOR Rates, or (ii) any publication of
LIBOR rates available from the BBA.  In the event the BBA ceases to
set or publish a LIBOR rate/interest settlement rate for the LIBOR Index, Lender
will designate an alternative index, and such alternative index shall constitute
the LIBOR Index Page.

    


    "Loan" means the loan evidenced
by this Note.

    


    
      	
               
      

            	
              "Margin" means two and
      one-half (2.5) percentage points (250 basis
  points).

            


    

    


    "Maturity Date" means the
Extended Maturity Date unless pursuant to Section 3(e) of this Note the
Extension Period does not or cannot become effective, in which case the Maturity
Date means the Initial Maturity Date.

    


    "Maximum Interest Rate" means
the rate of interest that results in the maximum amount of interest allowed by
applicable law.

    


    "Prepayment Premium Period"
means the period during which, if a prepayment of principal occurs, a prepayment
premium will be payable by Borrower to Lender.  The Prepayment Premium
Period is the period from and including the date of this Note until but not
including the first day of the Window Period.  For this Note, the
Prepayment Premium Period equals the Yield Maintenance Period.

    


    "Reference Billsâ" means
the unsecured general obligations of the Federal Home Loan Mortgage Corporation
("Freddie Mac")
designated by Freddie Mac as "Reference BillsâSecurities" and having
original durations to maturity most comparable to the term of the Reference Bill
Index, and issued by Freddie Mac at regularly scheduled auctions.  In
the event Freddie Mac shall at any time cease to designate any unsecured general
obligations of Freddie Mac as "Reference Bills Securities", then at the option
of Lender (i) Lender may select from time to time


    
      
         


      

      
        PAGE
- 3

        
          

        

      

      
         


        
          Freddie
Mac Loan Number 504111949

          Woods
at Eddy Pond

          


          


        

      

    


    another
unsecured general obligation of Freddie Mac having original durations to
maturity most comparable to the term of the Reference Bill Index and issued by
Freddie Mac at regularly scheduled auctions, and the term "Reference Bills" as
used in this Note shall mean such other unsecured general obligations as
selected by Lender; or (ii) for any one or more Interest Adjustment Periods,
Lender may use the applicable LIBOR Index Rate as the Index Rate for such
Interest Adjustment Period(s).

    


    "Reference Bill Index" means
the one-month Reference Bills.  One-month reference bills have
original durations to maturity of approximately 30 days.

    


    "Reference Bill Index Rate"
means, for any Interest Adjustment Period after the first Interest Adjustment
Period, the Money Market Yield for the Reference Bills as established by the
Reference Bill auction conducted by Freddie Mac most recently preceding the
first day of such Interest Adjustment Period, as displayed on the Reference Bill
Index Page.  The Reference Bill Index Rate for the first Interest
Adjustment Period means the Money Market Yield for the Reference Bills as
established by the Reference Bill auction conducted by Freddie Mac most recently
preceding the first day of the month in which the first Interest Adjustment
Period begins, as displayed on the Reference Bill Index Page.  The
"Reference Bill Index
Page" is the Freddie Mac Debt Securities Web Page (accessed via the
Freddie Mac internet site at www.freddiemac.com), or at the option of Lender,
any publication of Reference Bills auction results available from Freddie Mac.
However, if Freddie Mac has not conducted a Reference Bill auction within the
60-calendar day period prior to the first day of an Interest Adjustment Period,
the Reference Bill Index Rate for such Interest Adjustment Period will be the
LIBOR Index Rate for such Interest Adjustment Period.

    


    "Remaining Amortization Period"
means, at any point in time, the number of consecutive calendar months equal to
the number of months in the Amortization Period minus the number of scheduled
monthly installments of principal and
interest that have elapsed since the date of this Note.

    


    "Security Instrument" means the
multifamily mortgage, deed to secure debt or deed of trust effective as of the
effective date of this Note, from Borrower to or for the benefit of Lender and
securing this Note.

    


    
      	
               
      

            	
              "Treasury Security" means
      the 9.00% U.S. Treasury Security due November 15,
  2018.

            


    


    
      
         


      

      
        PAGE
- 4

        
          

        

      

      
         


        
          Freddie
Mac Loan Number 504111949

          Woods
at Eddy Pond

          


          


        

      

    


    


    "Window Period" means the
Extension Period.

    


    "Yield Maintenance Period"
means the period from and including the date of this Note until but not
including the Scheduled Initial Maturity Date.

    


    (b)           Other
capitalized terms used but not defined in this Note shall have the meanings
given to such terms in the Security Instrument.

    


    2.           Address for
Payment.  All payments due under this Note shall be payable at
127 Public Square, Cleveland, Ohio 44114, or such other place as may be
designated by Notice to Borrower from or on behalf of Lender.

    


    3.           Payments.

    


    (a)           During
the Fixed Rate Period, interest will accrue on the outstanding principal balance
of this Note at the Fixed Interest Rate, subject to the provisions of Section 8
of this Note. During the Extension Period, interest will accrue on the
outstanding principal balance of this Note at the Adjustable Interest Rate,
subject to the provisions of Section 8 of this Note.

    


    (b)           Interest
under this Note shall be computed, payable and allocated on the basis of an
actual/360 interest calculation schedule (interest is payable for the actual
number of days in each month, and each month's interest is calculated by
multiplying the unpaid principal amount of this Note as of the first day of the
month for which interest is being calculated by the Fixed Interest Rate (during
the Fixed Rate Period) or the applicable Adjustable Interest Rate (during the
Extension Period), dividing the product by 360, and multiplying the quotient by
the number of days in the month for which interest is being
calculated).  For convenience in determining the amount of a monthly
installment of principal and interest under this Note, Lender will use a 30/360
interest calculation payment schedule (each year is treated as consisting of
twelve 30-day months).  However, as provided above, the portion of the
monthly installment actually payable as and allocated to interest will be based
upon an actual/360 interest calculation schedule, and the amount of each
installment attributable to principal and the amount attributable to interest
will vary based upon the number of days in the month for which such installment
is paid.  Each monthly payment of principal and interest will first be
applied to pay in full interest due, and the balance of the monthly payment paid
by Borrower will be credited to principal.

    


    (c)           Unless
disbursement of principal is made by Lender to Borrower on the first day of a
calendar month, interest for the period beginning on the date of disbursement
and ending on and including the last day of such calendar month shall be payable
by Borrower simultaneously


    
      
         


      

      
        PAGE
- 5

        
          

        

      

      
         


        
          Freddie
Mac Loan Number 504111949

          Woods
at Eddy Pond

          


          


        

      

    


    with the
execution of this Note.  If disbursement of principal is made by
Lender to Borrower on the first day of a calendar month, then no payment will be
due from Borrower at the time of the execution of this Note.  The
Installment Due Date for the first monthly installment payment under Section
3(d) of interest only or principal and interest, as applicable, will be the
First Installment Due Date set forth in Section 1(a) of this
Note.  Except as provided in this Section 3(c) and in Section 10,
accrued interest will be payable in arrears.

    


    
      	
               
      

            	
               (d)

            	
              (i)

            	
              Beginning
      on the First Installment Due Date, and continuing until and including the
      monthly installment due on July 1, 2009 accrued interest only shall be
      payable by Borrower in consecutive monthly installments due and payable on
      the first day of each calendar month. The amount of each monthly
      installment of interest only payable pursuant to this Subsection 3(d)(i)
      on an Installment Due Date shall vary, and shall equal $1,495.69600
      multiplied by the number of days in the month prior to the Installment Due
      Date.

            


    

    


    
      	
               
      

            	
              (ii)

            	
              Beginning
      on August 1, 2009, and continuing until and including the monthly
      installment due on the Initial Maturity Date, principal and accrued
      interest shall be payable by Borrower in consecutive monthly installments
      due and payable on the first day of each calendar month. The amount of the
      monthly installment of principal and interest payable pursuant to this
      Subsection 3(d)(ii) on an Installment Due Date shall be Fifty-One Thousand
      Nine Hundred Seventy-Nine and 90/100 Dollars
  ($51,979.90).

            


    

    


    (e)           Except
as otherwise provided in this Section 3(e), all remaining Indebtedness,
including all principal and interest, shall be due and payable by Borrower on
the Initial Maturity Date.  However, so long as (i) the Initial
Maturity Date has not occurred prior to the Scheduled Initial Maturity Date, and
(ii) no Event of Default or event or circumstance which, with the giving of
notice or passage of time or both, could constitute an Event of Default exists
on the Scheduled Initial Maturity Date, then the Extension Period automatically
will become effective and the date for full payment of the Indebtedness
automatically shall be extended until the Extended Maturity Date.  If
the Extension Period becomes effective, monthly installments of principal and
interest or interest only will be payable during the Extension Period as
provided in Section 3(f).  Anything in Section 21 of the Security
Instrument to the contrary notwithstanding, during the Extension Period,
Borrower will not request that Lender consent to, and Lender will not consent
to, a Transfer that, absent such consent, would constitute an Event of
Default.

    


    (f)           If
the Extension Period becomes effective, beginning on August 1, 2018, and
continuing until and including the monthly installment due on the Extended
Maturity Date,


    
      
         


      

      
        PAGE
- 6

        
          

        

      

      
         


        
          Freddie
Mac Loan Number 504111949

          Woods
at Eddy Pond

          


          


        

      

    


    principal
and accrued interest shall be payable by Borrower in consecutive monthly
installments due and payable on the first day of each calendar
month.  The amount of the monthly installment of principal and
interest payable pursuant to this Section 3(f) on an Installment Due Date shall
be calculated so as to equal the monthly payment amount which would be payable
on the Installment Due Date as if the unpaid principal balance of this Note as
of the first day of the Interest Adjustment Period immediately preceding the
Installment Due Date was to be fully amortized, together with interest thereon
at the Adjustable Interest Rate in effect for such Interest Adjustment Period,
in equal consecutive monthly payments paid on the first day of each calendar
month over the Remaining Amortization Period.

    


    (g)           During
the Extension Period, Lender shall provide Borrower with Notice, given in the
manner specified in the Security Instrument, of the amount of each monthly
installment due under this Note.  However, if Lender has not provided
Borrower with prior notice of the monthly payment due on any Installment Due
Date, then Borrower shall pay on that Installment Due Date an amount equal to
the monthly installment payment for which Borrower last received
notice.  If Lender at any time determines that Borrower has paid one
or more monthly installments in an incorrect amount because of the operation of
the preceding sentence, or because Lender has miscalculated the Adjustable
Interest Rate or has otherwise miscalculated the amount of any monthly
installment, then Lender shall give notice to Borrower of such
determination.  If such determination discloses that Borrower has paid
less than the full amount due for the period for which the determination was
made, Borrower, within 30 calendar days after receipt of the notice from Lender,
shall pay to Lender the full amount of the deficiency.  If such
determination discloses that Borrower has paid more than the full amount due for
the period for which the determination was made, then the amount of the
overpayment shall be credited to the next installment(s) of interest only or
principal and interest, as applicable, due under this Note (or, if an Event of
Default has occurred and is continuing, such overpayment shall be credited
against any amount owing by Borrower to Lender).

    


    (h)           All
payments under this Note shall be made in immediately available U.S.
funds.

    


    (i)           Any
regularly scheduled monthly installment of interest only or principal and
interest payable pursuant to this Section 3 that is received by Lender
before the date it is due shall be deemed to have been received on the due date
for the purpose of calculating interest due.

    


    (j)           Any
accrued interest remaining past due for 30 days or more, at Lender's discretion,
may be added to and become part of the unpaid principal balance of this Note and
any reference to "accrued interest" shall refer to accrued interest which has
not become part of the unpaid principal balance.  Any amount added to
principal pursuant to the Loan Documents shall bear interest at the applicable
rate or rates specified in this Note and shall be payable with
such


    
      
         


      

      
        PAGE
- 7

        
          

        

      

      
         


        
          Freddie
Mac Loan Number 504111949

          Woods
at Eddy Pond

          


          


        

      

    


    interest
upon demand by Lender and absent such demand, as provided in this Note for the
payment of principal and interest.

    


    (k)           In
accordance with Section 14, interest charged under this Note cannot exceed the
Maximum Interest Rate.   If the Adjustable Interest Rate at any
time exceeds the Maximum Interest Rate, resulting in the charging of interest
hereunder to be limited to the Maximum Interest Rate, then any subsequent
reduction in the Adjustable Interest Rate shall not reduce the rate at which
interest under this Note accrues below the Maximum Interest Rate until the total
amount of interest accrued hereunder equals the amount of interest which would
have accrued had the Adjustable Interest Rate at all times been in
effect.

    


    4.           Application of
Payments.  If at any time Lender receives, from Borrower or
otherwise, any amount applicable to the Indebtedness which is less than all
amounts due and payable at such time, Lender may apply the amount received to
amounts then due and payable in any manner and in any order determined by
Lender, in Lender's discretion.  Borrower agrees that neither Lender's
acceptance of a payment from Borrower in an amount that is less than all amounts
then due and payable nor Lender's application of such payment shall constitute
or be deemed to constitute either a waiver of the unpaid amounts or an accord
and satisfaction.

    


    5.           Security.  The
Indebtedness is secured by, among other things, the Security Instrument, and
reference is made to the Security Instrument for other rights of Lender as to
collateral for the Indebtedness.

    


    6.           Acceleration.  If an
Event of Default has occurred and is continuing, the entire unpaid principal
balance, any accrued interest, any prepayment premium payable under
Section 10, and all other amounts payable under this Note and any other
Loan Document, shall at once become due and payable, at the option of Lender,
without any prior notice to Borrower (except if notice is required by applicable
law, then after such notice).  Lender may exercise this option to
accelerate regardless of any prior forbearance.  For purposes of
exercising such option, Lender shall calculate the prepayment premium as if
prepayment occurred on the date of acceleration.  If prepayment occurs
thereafter, Lender shall recalculate the prepayment premium as of the actual
prepayment date.

    


    7.           Late
Charge.

    


    (a)           If
any monthly installment of interest or principal and interest or other amount
payable under this Note or under the Security Instrument or any other Loan
Document is not received in full by Lender (i) during the Fixed Rate Period,
within ten (10) days after the installment or other amount is due, or (ii)
during the Extension Period, within five (5) days after


    
      
         


      

      
        PAGE
- 8

        
          

        

      

      
         


        
          Freddie
Mac Loan Number 504111949

          Woods
at Eddy Pond

          


          


        

      

    


    the
installment or other amount is due, counting from and including the date such
installment or other amount is due (unless applicable law requires a longer
period of time before a late charge may be imposed, in which event such longer
period shall be substituted), Borrower shall pay to Lender, immediately and
without demand by Lender, a late charge equal to five percent (5%) of such
installment or other amount due (unless applicable law requires a lesser amount
be charged, in which event such lesser amount shall be
substituted).

    


    (b)           Borrower
acknowledges that its failure to make timely payments will cause Lender to incur
additional expenses in servicing and processing the Loan and that it is
extremely difficult and impractical to determine those additional
expenses.  Borrower agrees that the late charge payable pursuant to
this Section represents a fair and reasonable estimate, taking into account
all circumstances existing on the date of this Note, of the additional expenses
Lender will incur by reason of such late payment.  The late charge is
payable in addition to, and not in lieu of, any interest payable at the Default
Rate pursuant to Section 8.

    


    8.           Default
Rate.

    


    (a)           So
long as (i) any monthly installment under this Note remains past due for
thirty (30) days or more or (ii) any other Event of Default has occurred
and is continuing, then notwithstanding anything in Section 3 of this Note to
the contrary, interest under this Note shall accrue on the unpaid principal
balance from the Installment Due Date of the first such unpaid monthly
installment or the occurrence of such other Event of Default, as applicable, at
the Default Rate.

    


    (b)           From
and after the Maturity Date, the unpaid principal balance shall continue to bear
interest at the Default Rate until and including the date on which the entire
principal balance is paid in full.

    


    (c)           Borrower
acknowledges that (i) its failure to make timely payments will cause Lender
to incur additional expenses in servicing and processing the Loan,
(ii) during the time that any monthly installment under this Note is
delinquent for thirty (30) days or more, Lender will incur additional costs and
expenses arising from its loss of the use of the money due and from the adverse
impact on Lender's ability to meet its other obligations and to take advantage
of other investment opportunities; and (iii)  it is extremely difficult and
impractical to determine those additional costs and
expenses.  Borrower also acknowledges that, during the time that any
monthly installment under this Note is delinquent for thirty (30) days or more
or any other Event of Default has occurred and is continuing, Lender's risk of
nonpayment of this Note will be materially increased and Lender is entitled to
be compensated for such increased risk.  Borrower agrees that the
increase in the rate of interest payable under this Note to the Default
Rate


    
      
         


      

      
        PAGE
- 9

        
          

        

      

      
         


        
          Freddie
Mac Loan Number 504111949

          Woods
at Eddy Pond

          


          


        

      

    


    represents
a fair and reasonable estimate, taking into account all circumstances existing
on the date of this Note, of the additional costs and expenses Lender will incur
by reason of the Borrower's delinquent payment and the additional compensation
Lender is entitled to receive for the increased risks of nonpayment associated
with a delinquent loan.

    


    9.           Limits on Personal
Liability.

    


    (a)           Except
as otherwise provided in this Section 9, Borrower shall have no personal
liability under this Note, the Security Instrument or any other Loan Document
for the repayment of the Indebtedness or for the performance of any other
obligations of Borrower under the Loan Documents and Lender's only recourse for
the satisfaction of the Indebtedness and the performance of such obligations
shall be Lender's exercise of its rights and remedies with respect to the
Mortgaged Property and to any other collateral held by Lender as security for
the Indebtedness.  This limitation on Borrower's liability shall not
limit or impair Lender's enforcement of its rights against any guarantor of the
Indebtedness or any guarantor of any other obligations of Borrower.

    


    (b)           Borrower
shall be personally liable to Lender for the amount of the Base Recourse, plus
any other amounts for which Borrower has personal liability under this
Section 9.

    


    (c)           In
addition to the Base Recourse, Borrower shall be personally liable to Lender for
the repayment of a further portion of the Indebtedness equal to any loss or
damage suffered by Lender as a result of the occurrence of any of the following
events:

    


    
      	
               
      

            	
              (i)

            	
              Borrower
      fails to pay to Lender upon demand after an Event of Default all Rents to
      which Lender is entitled under Section 3(a) of the Security
      Instrument and the amount of all security deposits collected by Borrower
      from tenants then in residence.  However, Borrower will not be
      personally liable for any failure described in this subsection (i) if
      Borrower is unable to pay to Lender all Rents and security deposits as
      required by the Security Instrument because of a valid order issued in a
      bankruptcy, receivership, or similar judicial
  proceeding.

            


    

    


    
      	
               
      

            	
              (ii)

            	
              Borrower
      fails to apply all insurance proceeds and condemnation proceeds as
      required by the Security Instrument.  However, Borrower will not
      be personally liable for any failure described in this
      subsection (ii) if Borrower is unable to apply insurance or
      condemnation proceeds as required by the Security Instrument because of a
      valid order issued in a bankruptcy, receivership, or similar judicial
      proceeding.

            


    


    
      
         


      

      
        PAGE
- 10

        
          

        

      

      
         


        
          Freddie
Mac Loan Number 504111949

          Woods
at Eddy Pond

          


          


        

      

    


    


    
      	
               
      

            	
              (iii)

            	
              Borrower
      fails to comply with Section 14(g) or (h) of the Security Instrument
      relating to the delivery of books and records, statements, schedules and
      reports.

            


    

    


    
      	
               
      

            	
              (iv)

            	
              Borrower
      fails to pay when due in accordance with the terms of the Security
      Instrument the amount of any item below marked
      "Deferred"; provided however, that if no item is marked "Deferred", this
      Section 9(c)(iv) shall be of no force or
      effect.  

            


    

    
      	
               
      

            	 	
              [Deferred]

            	
              Hazard
      Insurance premiums or other insurance
premiums,

            


    

    [Collect]                      Taxes,

    
      	
               
      

            	
              [Deferred]

            	
              water
      and sewer charges (that could become a lien on the Mortgaged
      Property),

            


    

    [N/A]                                ground
rents,

    
      	
               
      

            	
              [Deferred]

            	
              assessments
      or other charges (that could become a lien on the Mortgaged
      Property)

            


    

    


    (d)           In
addition to the Base Recourse, Borrower shall be personally liable to Lender
for:

    


    
      	
               
      

            	
              (i)

            	
              the
      performance of all of Borrower's obligations under Section 18 of the
      Security Instrument (relating to environmental
  matters);

            


    

    


    
      	
               
      

            	
              (ii)

            	
              the
      costs of any audit under Section 14(g) of the Security Instrument;
      and

            


    

    


    
      	
               
      

            	
              (iii)

            	
              any
      costs and expenses incurred by Lender in connection with the collection of
      any amount for which Borrower is personally liable under this
      Section 9, including Attorneys' Fees and Costs and the costs of
      conducting any independent audit of Borrower's books and records to
      determine the amount for which Borrower has personal
      liability.

            


    

    


    (e)           
All payments made by Borrower with respect to the Indebtedness and all amounts
received by Lender from the enforcement of its rights under the Security
Instrument and the other Loan Documents shall be applied first to the portion of
the Indebtedness for which Borrower has no personal liability.

    


    (f)           Notwithstanding
the Base Recourse, Borrower shall become personally liable to Lender for the
repayment of all of the Indebtedness upon the occurrence of any of the following
Events of Default:

    



    
      
         


      

      
        PAGE
- 11

        
          

        

      

      
         


        
          Freddie
Mac Loan Number 504111949

          Woods
at Eddy Pond

          


          


        

      

    


    
      	
               
      

            	
              (i)

            	
              Borrower's
      ownership of any property or operation of any business not permitted by
      Section 33 of the Security
Instrument;

            


    

    


    
      	
               
      

            	
              (ii)

            	
              a
      Transfer (including, but not limited to, a lien or encumbrance) that is an
      Event of Default under Section 21 of the Security Instrument, other
      than a Transfer consisting solely of the involuntary removal or
      involuntary withdrawal of a general partner in a limited partnership or a
      manager in a limited liability company;
or

            


    

    


    
      	
               
      

            	
              (iii)

            	
              fraud
      or written material misrepresentation by Borrower or any officer,
      director, partner, member or employee of Borrower in connection with the
      application for or creation of the Indebtedness or any request for any
      action or consent by Lender.

            


    

    


    (g)           To
the extent that Borrower has personal liability under this Section 9,
Lender may exercise its rights against Borrower personally without regard to
whether Lender has exercised any rights against the Mortgaged Property or any
other security, or pursued any rights against any guarantor, or pursued any
other rights available to Lender under this Note, the Security Instrument, any
other Loan Document or applicable law. To the
fullest extent permitted by applicable law, in any action to enforce Borrower's
personal liability under this Section 9, Borrower waives any right to set
off the value of the Mortgaged Property against such personal
liability.

    


    10.           Voluntary
and Involuntary Prepayments.

    


    (a)           Any
receipt by Lender of principal due under this Note prior to the Maturity Date,
other than principal required to be paid in monthly installments pursuant to
Section 3, constitutes a prepayment of principal under this
Note.  Without limiting the foregoing, any application by Lender,
prior to the Maturity Date, of any proceeds of collateral or other security to
the repayment of any portion of the unpaid principal balance of this Note
constitutes a prepayment under this Note.

    
 

    (b)           Borrower
may voluntarily prepay all of the unpaid principal balance of this Note on an Installment Due Date
so long as
Borrower designates the date for such prepayment in a Notice from
Borrower to Lender given at least 30 days prior to the date of such
prepayment.  If an Installment Due Date (as defined in Section 1(a))
falls on a day which is not a Business Day, then with respect to payments
made under this Section 10 only, the term "Installment Due Date" shall mean the
Business Day immediately preceding the scheduled Installment Due
Date.

    



    
      
         


      

      
        PAGE
- 12

        
          

        

      

      
         


        
          Freddie
Mac Loan Number 504111949

          Woods
at Eddy Pond

          


          


        

      

    


    (c)           Notwithstanding
subsection (b) above, Borrower may voluntarily prepay all of the unpaid
principal balance of this Note on a Business Day other than an Installment Due
Date if Borrower provides Lender with the Notice set forth in subsection (b) and
meets the other requirements set forth in this subsection.  Borrower
acknowledges that Lender has agreed that Borrower may prepay principal on a
Business Day other than an Installment Due Date only because Lender shall deem
any prepayment received by Lender on any day other than an Installment Due Date
to have been received on the Installment Due Date immediately following such
prepayment and Borrower shall be responsible for all interest that would have
been due if the prepayment had actually been made on the Installment Due Date
immediately following such prepayment.

    


    (d)           Unless
otherwise expressly provided in the Loan Documents, Borrower may not voluntarily
prepay less than all of the unpaid principal balance of this Note.  In
order to voluntarily prepay all or any part of the principal of this Note,
Borrower must also pay to Lender, together with the amount of principal
being prepaid, (i) all accrued and unpaid interest due under this Note,
plus (ii) all other sums due to Lender at the time of such prepayment, plus
(iii) any prepayment premium calculated pursuant to
Section 10(e).

    


    (e)           Except
as provided in Section 10(f), a prepayment premium shall be due and payable by
Borrower in connection with any prepayment of principal under this Note during
the Prepayment Premium Period.  The prepayment premium shall be
whichever is the greater of subsections (A) and (B) below:

    


    
      	
               
      

            	
              (A)

            	
              1.0%
      of the amount of principal being prepaid;
or

            


    

    


    (B)           the
product obtained by multiplying:

    


    (1)           the
amount of principal being prepaid or accelerated,

    by

    
      	
               
      

            	
              (2)

            	
              the
      excess (if any) of the Monthly Note Rate over the Assumed Reinvestment
      Rate,

            


    

    by

    (3)           the
Present Value Factor.

    


    For purposes of subsection (B),
the following definitions shall apply:

    


    
      	
               
      

            	
              Monthly Note Rate:
      one-twelfth (1/12) of the Fixed Interest Rate, expressed as a decimal
      calculated to five digits.

            


    

    



    
      
         


      

      
        PAGE
- 13

        
          

        

      

      
         


        
          Freddie
Mac Loan Number 504111949

          Woods
at Eddy Pond

          


          


        

      

    


    
      	
               
      

            	
              Prepayment
      Date:  in the case of a voluntary prepayment, the date on
      which the prepayment is made; in the case of the application by Lender of
      collateral or security to a portion of the principal balance, the date of
      such application.

            


    

    


    
      	
               
      

            	
              Assumed Reinvestment
      Rate:  one-twelfth (1/12) of the yield rate, as of the
      close of the trading session which is 5 Business Days before the
      Prepayment Date, on the Treasury Security, as reported in The Wall Street
      Journal, expressed as a decimal calculated to five
      digits.  In the event that no yield is published on the
      applicable date for the Treasury Security, Lender, in its discretion,
      shall select the non-callable Treasury Security maturing in the same year
      as the Treasury Security with the lowest yield published in The Wall Street Journal
      as of the applicable date.  If the publication of such yield
      rates in The Wall Street
      Journal is discontinued for any reason, Lender shall select a
      security with a comparable rate and term to the Treasury
      Security.  The selection of an alternate security pursuant to
      this Section shall be made in Lender’s
  discretion.

            


    

    


    
      	
               
      

            	
              Present Value
      Factor:  the factor that discounts to present value the
      costs resulting to Lender from the difference in interest rates during the
      months remaining in the Yield Maintenance Period, using the Assumed
      Reinvestment Rate as the discount rate, with monthly compounding,
      expressed numerically as follows:

            


    

    


     

    


    
      	
               
      

            	
              n = the number of months
      remaining in Yield Maintenance Period; provided, however, if a prepayment
      occurs on an Installment Due Date, then the number of months remaining in
      the Yield Maintenance Period shall be
      calculated beginning with the month in which such prepayment occurs and if
      such prepayment occurs on a Business Day other than an Installment Due
      Date, then the number of months remaining in the Yield Maintenance Period
      shall be calculated beginning with the month immediately following the
      date of such prepayment.

            


    

    



    
      
         


      

      
        PAGE
- 14

        
          

        

      

      
         


        
          Freddie
Mac Loan Number 504111949

          Woods
at Eddy Pond

          


          


        

      

    


    ARR = Assumed Reinvestment
Rate

    


    (f)           Notwithstanding
any other provision of this Section 10, no prepayment premium shall be
payable with respect to (i) any prepayment made during the Window Period,
or (ii) any prepayment occurring as a result of the application of any
insurance proceeds or condemnation award under the Security
Instrument.

    


    (g)           Unless
Lender agrees otherwise in writing, a permitted or required prepayment of less
than the unpaid principal balance of this Note shall not extend or postpone the
due date of any subsequent monthly installments or change the amount of such
installments.

    


    (h)           Borrower
recognizes that any prepayment of any of the unpaid principal balance of this
Note, whether voluntary or involuntary or resulting from an Event of Default by
Borrower, will result in Lender's incurring loss, including reinvestment loss,
additional expense and frustration or impairment of Lender's ability to meet its
commitments to third parties.  Borrower agrees to pay to Lender upon
demand damages for the detriment caused by any prepayment, and agrees that it is
extremely difficult and impractical to ascertain the extent of such
damages.  Borrower therefore acknowledges and agrees that the formula
for calculating prepayment premiums set forth in this Note represents a
reasonable estimate of the damages Lender will incur because of a
prepayment.  Borrower further acknowledges that any lockout and
prepayment premium provisions of this Note are a material part of the
consideration for the Loan, and that the terms of this Note are in other
respects more favorable to Borrower as a result of the Borrower's voluntary
agreement to the lockout and prepayment premium provisions.

    


    11.           Costs and
Expenses.  To the fullest extent allowed by applicable law,
Borrower shall pay all expenses and costs, including Attorneys' Fees and Costs
incurred by Lender as a result of any default under this Note or in connection
with efforts to collect any amount due under this Note, or to enforce the
provisions of any of the other Loan Documents, including those incurred in
post-judgment collection efforts and in any bankruptcy proceeding (including any
action for relief from the automatic stay of any bankruptcy proceeding) or
judicial or non-judicial foreclosure proceeding.

    


    12.           Forbearance.  Any
forbearance by Lender in exercising any right or remedy under this Note, the
Security Instrument, or any other Loan Document or otherwise afforded by
applicable law, shall not be a waiver of or preclude the exercise of that or any
other right or remedy.  The acceptance by Lender of any payment after
the due date of such payment, or in an amount which is less than the required
payment, shall not be a waiver of Lender's right to require prompt payment when
due of all other payments or to exercise any right or remedy with respect to any
failure to make prompt payment.  Enforcement by Lender of any security
for Borrower's


    
      
         


      

      
        PAGE
- 15

        
          

        

      

      
         


        
          Freddie
Mac Loan Number 504111949

          Woods
at Eddy Pond

          


          


        

      

    


    obligations
under this Note shall not constitute an election by Lender of remedies so as to
preclude the exercise of any other right or remedy available to
Lender.

    


    13.           Waivers.  Borrower
and all endorsers and guarantors of this Note and all other third party obligors
waive presentment, demand, notice of dishonor, protest, notice of acceleration,
notice of intent to demand or accelerate payment or maturity, presentment for
payment, notice of nonpayment, grace, and diligence in collecting the
Indebtedness.

    


               14.           Loan
Charges.  Neither this Note nor any of the other Loan Documents
shall be construed to create a contract for the use, forbearance or detention of
money requiring payment of interest at a rate greater than the Maximum Interest
Rate.  If any applicable law limiting the amount of interest or other
charges permitted to be collected from Borrower in connection with the Loan is
interpreted so that any interest or other charge provided for in any Loan
Document, whether considered separately or together with other charges provided
for in any other Loan Document, violates that law, and Borrower is entitled to
the benefit of that law, that interest or charge is hereby reduced to the extent
necessary to eliminate that violation.  The amounts, if any,
previously paid to Lender in excess of the permitted amounts shall be applied by
Lender to reduce the unpaid principal balance of this Note. For the purpose of
determining whether any applicable law limiting the amount of interest or other
charges permitted to be collected from Borrower has been violated, all
Indebtedness that constitutes interest, as well as all other charges made in
connection with the Indebtedness that constitute interest, shall be deemed to be
allocated and spread ratably over the stated term of this
Note.  Unless otherwise required by applicable law, such allocation
and spreading shall be effected in such a manner that the rate of interest so
computed is uniform throughout the stated term of this Note.

    


    15.           Commercial
Purpose.  Borrower represents that Borrower is incurring the
Indebtedness solely for the purpose of carrying on a business or commercial
enterprise, and not for personal, family, household, or agricultural
purposes.

    


    16.           Counting of
Days.  Except where otherwise specifically provided, any
reference in this Note to a period of "days" means calendar days, not Business
Days.

    


    17.           Governing Law.  This
Note shall be governed by the law of the Property Jurisdiction.

    


    18.           Captions.  The
captions of the Sections of this Note are for convenience only and shall be
disregarded in construing this Note.

    


    19.           Notices; Written Modifications.



    
      
         


      

      
        PAGE
- 16

        
          

        

      

      
         


        
          Freddie
Mac Loan Number 504111949

          Woods
at Eddy Pond

          


          


        

      

    


    


    (a)           All
Notices, demands and other communications required or permitted to be given
pursuant to this Note shall be given in accordance with Section 31 of the
Security Instrument.

    


    (b)           Any
modification or amendment to this Note shall be ineffective unless in writing
signed by the party sought to be charged with such modification or amendment;
provided, however, that in the event of a Transfer under the terms of the
Security Instrument that requires Lender's consent, any or some or all of the
Modifications to Multifamily Note set forth in Exhibit A to this Note may
be modified or rendered void by Lender at Lender's option, by Notice to Borrower
and the transferee, as a condition of Lender's consent.

    


    20.           Consent to Jurisdiction and
Venue.  Borrower agrees that any controversy arising under or
in relation to this Note may be litigated in the Property
Jurisdiction.  The state and federal courts and authorities with
jurisdiction in the Property Jurisdiction shall have jurisdiction over all
controversies that shall arise under or in relation to this
Note.  Borrower irrevocably consents to service, jurisdiction, and
venue of such courts for any such litigation and waives any other venue to which
it might be entitled by virtue of domicile, habitual residence or
otherwise.  However, nothing in this Note is intended to limit any
right that Lender may have to bring any suit, action or proceeding relating to
matters arising under this Note in any court of any other
jurisdiction.

    


    21.           WAIVER
OF TRIAL BY JURY.  BORROWER AND LENDER EACH (A) AGREES NOT TO
ELECT A TRIAL BY JURY WITH RESPECT TO ANY ISSUE ARISING OUT OF THIS NOTE OR THE
RELATIONSHIP BETWEEN THE PARTIES AS LENDER AND BORROWER THAT IS TRIABLE OF RIGHT
BY A JURY AND (B) WAIVES ANY RIGHT TO TRIAL BY JURY WITH RESPECT TO SUCH
ISSUE TO THE EXTENT THAT ANY SUCH RIGHT EXISTS NOW OR IN THE
FUTURE.  THIS WAIVER OF RIGHT TO TRIAL BY JURY IS SEPARATELY GIVEN BY
EACH PARTY, KNOWINGLY AND VOLUNTARILY WITH THE BENEFIT OF COMPETENT LEGAL
COUNSEL.

    
      


    

    
      


    

    
      22.                 State-Specific
Provisions.  N/A.

    

    


    ATTACHED
EXHIBIT.    The Exhibit noted below, if marked with an "X"
in the space provided, is attached to this Note:

    


    [X]             Exhibit
A                                Modifications
to Multifamily Note

    



    
      
         


      

      
        PAGE
- 17

        
          

        

      

      
         


        
          Freddie
Mac Loan Number 504111949

          Woods
at Eddy Pond

          


          


        

      

    


    


    IN WITNESS WHEREOF, and in
consideration of the Lender's agreement to lend Borrower the principal amount
set forth above, Borrower has signed and delivered this Note under seal or has
caused this Note to be signed and delivered under seal by its duly authorized
representative. Borrower intends that this Note shall be deemed to be signed and
delivered as a sealed instrument.


    
      
         


      

      
        PAGE
- 18

        
          

        

      

      
         


        
          Freddie
Mac Loan Number 504111949

          Woods
at Eddy Pond

          


          


        

      

    


    


    EMERITOL
WOODS AT EDDY POND LLC, a Delaware limited liability company

    


    
      	
               
      

            	
              By:

            	
              Summerville
      Senior Living, Inc., a Delaware
corporation

            


    

    


    
      	
               
      

            	
              Its:

            	
              Sole
      Member

            


    

    


    


    


    By:/s/ Eric
Mendelsohn
_

    Name:                      Eric
Mendelsohn

    
      	
               
      

            	
              Title:

            	
              Senior
      Vice President Corporate
Development

            


    

    


    


     


    
      
         


      

      
        PAGE
- 19

        
          

        

      

      
         


        
          Freddie
Mac Loan Number 504111949

          Woods
at Eddy Pond

          


          


        

      

    


    PAY TO
THE ORDER OF FEDERAL HOME LOAN MORTGAGE CORPORATION

    WITHOUT
RECOURSE.

    


    


    KEYCORP
REAL ESTATE CAPITAL MARKETS, INC., an Ohio corporation

    


    


    


    By:/s/ Robin M.
Mullenix

    Name:  Robin
M. Mullenix

    Title:    Vice
President

    


    Date:                      June
30, 2008

    



    
      
         


      

      
        PAGE
- 20

        
          

        

      

      
         


        
          Freddie
Mac Loan Number 504111949

          Woods
at Eddy Pond

          


          


        

      

    


    EXHIBIT
A

    


    MODIFICATIONS
TO MULTIFAMILY NOTE

    


    The
following modifications are made to the text of the Note that precedes this
Exhibit.

    


    
      	
              1.  

            	
              The
      definition of “Margin” in Section 1 is modified to read as
      follows:

            


    

    


    “means two and three-quarters (2.75)
percentage points (275 basis points)”.

    


    
      	
              2.  

            	
              Section
      7(a) is amended by adding the following phrase after “Loan Document” in
      the second line, “other than the payment of the entire outstanding
      principal balance due and payable on the Maturity
  Date,”.

            


    

     

    
      	
              3.  

            	
              Section
      9(c) is amended by adding the following phrase in both subsection (i) and
      subsection (ii), in each case after the word “in” and before the phrase “a
      bankruptcy, receivership, or similar judicial
  proceeding”:

            


    

    


    “or ‘automatic stay’ applicable because
of”.

    


    
      	
              4.  

            	
              Section
      9(d) is amended by adding the following new
  subsection:

            


    

    


    
      	
              OPPENHEIMER:
      2585849 v03 06/26/2008

            


    

    
      	
               
      

            	
              “(iv)

            	
              any
      costs, fees, and expenses incurred by Lender as a result of an insurance
      claim not being covered by Borrower’s captive insurer, which claim would
      or should have been covered by the insurance required under Section 19 of
      the Security Instrument, in Lender’s reasonable
      determination.”

            


    


    
      
         


      

      
        PAGE
A-1