Exhibit 10.146


MERS MIN: 8000101-0000004464-3


MB ST. LOUIS CHESTNUT, L.L.C.,

a
Delaware limited liability company, as Borrower


(Borrower)


to


DANIEL S. HUFFENUS, as trustee (Trustee) 

for the benefit of


MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC., a Delaware corporation, 

as nominee of Lender, as
beneficiary (Beneficiary)






DEED OF TRUST, SECURITY AGREEMENT AND FIXTURE FILING


This document serves as
a Fixture Filing under the Uniform Commercial Code.






	
  

  	
  Dated:

  	
  As of December 21, 2006

  
	
   

  	
  Location:

  	
  St. Louis, Missouri

  
	
   

  	
  County:

  	
  St. Louis

  
	
   

  	
  Borrower’s Federal Tax I.D. No.:

  	
   

  	
   

  
	
   

  	
  Borrower’s Organizational No.:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  PREPARED BY AND UPON

  RECORDATION RETURN TO:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Katten Muchin Rosenman LLP

  401 South Tryon Street, Suite 2600 

  Charlotte, North Carolina 28202 

  Attention: Daniel S. Huffenus,
  Esq.

  	
   

  
						



 















 


DEED OF
TRUST, SECURITY AGREEMENT AND FIXTURE FILING


THIS DEED
OF TRUST, SECURITY AGREEMENT AND FIXTURE FILING (this “Security
Instrument”) is made as of this 21 day of December, 2006 by MB ST. LOUIS CHESTNUT, L.L.C., a Delaware
limited liability company, having its principal place of business at 2901
Butterfield Road, Oak Brook, Illinois 60523, as mortgagor (“Borrower”), to DANIEL S. HUFFENUS, having an address at 401 South
Tryon Street, Suite 2600, Charlotte, North Carolina 28202, as trustee (“Trustee”)
for the benefit of MORTGAGE ELECTRONIC
REGISTRATION SYSTEMS, INC., a Delaware stock corporation, having an
address at 1595 Spring Hill Road, Vienna, Virginia 22182 (“MERS”),
as nominee of BEAR STEARNS COMMERCIAL
MORTGAGE, INC., a New York corporation, having an address at 383
Madison Avenue, New York, New York 10179, as beneficiary (together with its
successors and assigns, “Lender”).


W I  T
N  E  S  S  E  T  H:


WHEREAS, pursuant to that
certain Loan Agreement dated as of the date hereof between Borrower and Lender
(as the same may be amended, restated, replaced, supplemented or otherwise
modified from time to time, the “Loan
Agreement”), Borrower
has agreed to borrow from Lender the sum of ONE HUNDRED TWELVE MILLION SIX
HUNDRED NINETY FIVE THOUSAND AND NO/100 DOLLARS ($112,695,000.00) (the “Loan”) as evidenced by that certain Promissory Note dated the date
hereof made by Borrower to Lender (such Note, together with all extensions,
renewals, replacements, restatements or modifications thereof being hereinafter
referred to as the “Note”). The final payment of the Note is
due on January 1, 2037;


WHEREAS, Borrower desires to
secure the payment of the Debt (as defined hereinafter) and the performance of
all of its obligations under the Note, the Loan Agreement and the other Loan
Documents; and


WHEREAS, this Security
Instrument is that certain “Mortgage” as defined in the Loan Agreement, and
payment, fulfillment, and performance by Borrower of its obligations thereunder
and under the other Loan Documents are, subject to the limits set forth herein,
secured hereby, and each and every term and provision of the Loan Agreement and
the Note, including the rights, remedies, obligations, covenants, conditions,
agreements, indemnities, representations and warranties of the parties therein,
are hereby incorporated by reference herein as though set forth in full and
shall be considered a part of this Security Instrument (the Loan Agreement, the
Note, this Security Instrument, that certain Assignment of Leases and Rents of
even date herewith made by Borrower in favor of MERS, as nominee of Lender (the
“Assignment of Leases”) and all other documents evidencing
or securing the Debt are hereinafter referred to collectively as the “Loan Documents”).


NOW THEREFORE, in
consideration of the making of the Loan by Lender and the covenants,
agreements, representations and warranties set forth in this Security
Instrument:









 



ARTICLE I 


GRANTS OF
SECURITY


1.1           Property
Mortgaged. Borrower does hereby irrevocably mortgage, grant, bargain,
pledge, assign, warrant, transfer and convey to MERS, as nominee of Lender and
its successors and assigns the following property, rights, interests and
estates now owned, or hereafter acquired by Borrower (collectively, the “Property”):


(a)   Land. The real
property described in Exhibit A attached hereto and made a part hereof (the “Land”);


(b)  Additional Land. All
additional lands, estates and development rights hereafter acquired by Borrower
for use in connection with the Land and the development of the Land and all
additional lands and estates therein which may, from time to time, by
supplemental mortgage or otherwise be expressly made subject to the lien of
this Security Instrument;


(c)   Improvements. The
buildings, structures, fixtures, additions, enlargements, extensions,
modifications, repairs, replacements and improvements now or hereafter erected
or located on the Land (collectively, the “Improvements”);


(d)  Easements. All easements, rights-of-way or use, rights,
strips and gores of land, streets, ways, alleys, passages, sewer rights, water,
water courses, water rights and powers, air rights and development rights, and
all estates, rights, titles, interests, privileges, liberties, servitudes,
tenements, hereditaments and appurtenances of any nature whatsoever, in any way
now or hereafter belonging, relating or pertaining to the Land and the
Improvements and the reversion and reversions, remainder and remainders, and
all land lying in the bed of any street, road or avenue, opened or proposed, in
front of or adjoining the Land, to the center line thereof and all the estates,
rights, titles, interests, dower and rights of dower, curtesy and rights of
curtesy, property, possession, claim and demand whatsoever, both at law and in
equity, of Borrower of, in and to the Land and the Improvements and every part
and parcel thereof, with the appurtenances thereto;


(e)   Equipment. All “equipment,”
as such term is defined in Article 9 of the Uniform Commercial Code, now owned
or hereafter acquired by Borrower, which is used at or in connection with the
Improvements or the Land or is located thereon or therein (including, but not
limited to, all machinery, equipment, furnishings, and electronic
data-processing and other office equipment now owned or hereafter acquired by
Borrower and any and all additions, substitutions and replacements of any of
the foregoing), together with all attachments, components, parts, equipment and
accessories installed thereon or affixed thereto (collectively, the “Equipment”). Notwithstanding the foregoing, Equipment shall not include any
property belonging to tenants under leases except to the extent that Borrower
shall have any right or interest therein;



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(f)   Fixtures. All
Equipment now owned, or the ownership of which is hereafter acquired, by
Borrower which is so related to the Land and Improvements forming part of the
Property that it is deemed fixtures or real property under the law of the
particular state in which the Equipment is located, including, without
limitation, all building or construction materials intended for construction,
reconstruction, alteration or repair of or installation on the Property,
construction equipment, appliances, machinery, plant equipment, fittings,
apparatuses, fixtures and other items now or hereafter attached to, installed in
or used in connection with (temporarily or permanently) any of the Improvements
or the Land, including, but not limited to, engines, devices for the operation
of pumps, pipes, plumbing, cleaning, call and sprinkler systems, fire
extinguishing apparatuses and equipment, heating, ventilating, plumbing,
laundry, incinerating, electrical, air conditioning and air cooling equipment
and systems, gas and electric machinery, appurtenances and equipment, pollution
control equipment, security systems, disposals, dishwashers, refrigerators and
ranges, recreational equipment and facilities of all kinds, and water, gas,
electrical, storm and sanitary sewer facilities, utility lines and equipment
(whether owned individually or jointly with others, and, if owned jointly, to
the extent of Borrower’s interest therein) and all other utilities whether or
not situated in easements, all water tanks, water supply, water power sites,
fuel stations, fuel tanks, fuel supply, and all other structures, together with
all accessions, appurtenances, additions, replacements, betterments and
substitutions for any of the foregoing and the proceeds thereof (collectively,
the “Fixtures”). Notwithstanding the foregoing, “Fixtures”
shall not include any property which tenants are entitled to remove pursuant to
leases except to the extent that Borrower shall have any right or interest
therein;


(g)  Personal Property.
All furniture, furnishings, objects of art, machinery, goods, tools, supplies,
appliances, general intangibles, contract rights, accounts, accounts
receivable, franchises, licenses, certificates and permits, and all other
personal property of any kind or character whatsoever (as defined in and
subject to the provisions of the Uniform Commercial Code as hereinafter
defined), other than Fixtures, which are now or hereafter owned by Borrower and
which are located within or about the Land and the Improvements, together with
all accessories, replacements and substitutions thereto or therefor and the
proceeds thereof (collectively, the “Personal
Property”), and
the right, title and interest of Borrower in and to any of the Personal
Property which may be subject to any security interests, as defined in the
Uniform Commercial Code, as adopted and enacted by the state or states where
any of the Property is located (the “Uniform
Commercial Code”), superior
in lien to the lien of this Security Instrument and all proceeds and products
of the above;


(h)  Leases and Rents. All leases, subleases or subsubleases,
lettings, licenses, concessions or other agreements (whether written or oral)
pursuant to which any Person is granted a possessory interest in, or right to
use or occupy all or any portion of the Land and the Improvements, and every
modification, amendment or other agreement relating to such leases, subleases,
subsubleases, or other agreements entered into in connection with such leases,
subleases, subsubleases, or other agreements and every guarantee, of the
performance and observance of the covenants, conditions and agreements to be
performed and observed by the other party thereto, heretofore or hereafter
entered into, whether before or after the filing by or against Borrower of any
petition for relief under 11 U.S.C. §101 et seq., as the same may be



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amended from time to time (the “Bankruptcy Code”) (collectively, the “Leases”) and all right, title and interest of Borrower, its successors
and assigns therein and thereunder, including, without limitation, cash or
securities deposited thereunder to secure the performance by the lessees of
their obligations thereunder and all rents, additional rents, revenues, issues
and profits (including all oil and gas or other mineral royalties and bonuses)
from the Land and the Improvements whether paid or accruing before or after the
filing by or against Borrower of any petition for relief under the Bankruptcy
Code (collectively, the “Rents”) and
all proceeds from the sale or other disposition of the Leases and the right to
receive and apply the Rents to the payment of the Debt;


(i)   Condemnation Awards. All awards or payments, including
interest thereon, which may heretofore and hereafter be made with respect to
the Property, whether from the exercise of the right of eminent domain
(including but not limited to any transfer made in lieu of or in anticipation of
the exercise of the right), or for a change of grade, or for any other injury
to or decrease in the value of the Property subject to the terms, provisions
and conditions of the Loan Agreement;


(j)   Insurance Proceeds. All proceeds in respect of the Property
under any insurance policies covering the Property, including, without
limitation, the right to receive and apply the proceeds of any insurance,
judgments, or settlements made in lieu thereof, for damage to the Property
subject to the terms, provisions and conditions of the Loan Agreement;


(k)  Tax Certiorari. All refunds, rebates or credits in
connection with reduction in real estate taxes and assessments charged against
the Property as a result of tax certiorari or any applications or proceedings
for reduction;


(1)  Conversion. All proceeds of the conversion, voluntary or
involuntary, of any of the foregoing including, without limitation, proceeds of
insurance and condemnation awards, into cash or liquidation claims;


(m) Rights. Subject to the terms, provisions and conditions of
the Loan Agreement, the right, in the name and on behalf of Borrower, to appear
in and defend any action or proceeding brought with respect to the Property and
to commence any action or proceeding to protect the interest of Lender in the
Property;


(n)  Agreements. All agreements, contracts, certificates,
instruments, franchises, permits, licenses, plans, specifications and other
documents, now or hereafter entered into, and all rights therein and thereto,
respecting or pertaining to the use, occupation, construction, management or
operation of the Land and any part thereof and any Improvements or respecting
any business or activity conducted on the Land and any part thereof and all
right, title and interest of Borrower therein and thereunder, including,
without limitation, the right, upon the happening of any default hereunder, to
receive and collect any sums payable to Borrower thereunder, in each case, to
the extent assignable;



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(o) Trademarks. All
tradenames, trademarks, servicemarks, logos, copyrights, goodwill, books and
records and all other general intangibles relating to or used in connection
with the operation of the Property (excluding, however, the name “Inland” and
any mark registered to The Inland Group, Inc., or any of its affiliates), in
each case, to the extent assignable;


(p)  Accounts. All reserves, escrows and deposit accounts
maintained by Borrower with respect to the Property, including without
limitation, all securities, investments, property and financial assets held therein
from time to time and all proceeds, products, distributions or dividends or
substitutions thereon and thereof;


(q)  Letter of Credit. All letter-of-credit rights (whether or
not the letter of credit is evidenced by a writing) Borrower now has or hereafter
acquires relating to the properties, rights, titles and interests referred to
in this Section 1.1;


(r)   Tort Claims. All commercial tort claims Borrower now has or
hereafter acquires relating to the properties, rights, titles and interests
referred to in this Section 1.1; and


(s)  Other Rights. Any and all other rights of Borrower in and to
the items set forth in Subsections (a) through (r) above.


AND without limiting any of
the other provisions of this Security Instrument, to the extent permitted by applicable
law, Borrower expressly grants to MERS, as nominee of Lender, as secured party,
a security interest in the portion of the Property which is or may be subject
to the provisions of the Uniform Commercial Code which are applicable to
secured transactions; it being understood and agreed that the Improvements and
Fixtures are part and parcel of the Land (the Land, the Improvements and the
Fixtures collectively referred to as the “Real
Property”) appropriated
to the use thereof and, whether affixed or annexed to the Real Property or not,
shall for the purposes of this Security Instrument be deemed conclusively to be
real estate and mortgaged hereby.


1.2                 Assignment of Rents. Borrower hereby absolutely and
unconditionally assigns to MERS, as nominee of Lender, all of Borrower’s right,
title and interest in and to all current and future Leases and Rents; it being
intended by Borrower that this assignment constitutes a present, absolute
assignment and not an assignment for additional security only. Nevertheless,
subject to the terms of the Assignment of Leases and Section 7.1(h) of this
Security Instrument, Lender grants to Borrower a revocable license to collect,
receive, use and enjoy the Rents. Borrower shall hold the Rents, or a portion
thereof sufficient to discharge all current sums due on the Debt, for use in
the payment of such sums.


1.3                 Security Agreement. This Security Instrument is both a real
property mortgage and a “security agreement” within the meaning of the Uniform
Commercial Code. The Property includes both real and personal property and all
other rights and interests, whether tangible or intangible in nature, of
Borrower in the Property. By executing and delivering this



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Security Instrument, Borrower hereby grants to MERS,
as nominee of Lender, as security for the Obligations (hereinafter defined), a
security interest in the Fixtures, the Equipment and the Personal Property and
other property constituting the Property, whether now owned or hereafter
acquired, to the full extent that the Fixtures, the Equipment and the Personal
Property may be subject to the Uniform Commercial Code (said portion of the
Property so subject to the Uniform Commercial Code being called the “Collateral”). THE COLLATERAL IS OR INCLUDES FIXTURES. If an Event of Default shall
occur and be continuing, Lender, in addition to any other rights and remedies
which it may have, shall have and may exercise immediately and without demand,
any and all rights and remedies granted to a secured party upon default under
the Uniform Commercial Code, including, without limiting the generality of the
foregoing, the right to take possession of the Collateral or any part thereof,
and to take such other measures as Lender may deem necessary for the care,
protection and preservation of the Collateral. Upon request or demand of Lender
after the occurrence and during the continuance of an Event of Default,
Borrower shall, at its expense, assemble the Collateral and make it available
to Lender at a convenient place (at the Land if tangible property) reasonably
acceptable to Lender. Borrower shall pay to Lender on demand any and all
expenses, including reasonable legal expenses and attorneys’ fees, incurred or
paid by Lender in protecting its interest in the Collateral and in enforcing
its rights hereunder with respect to the Collateral after the occurrence and
during the continuance of an Event of Default. Any notice of sale, disposition
or other intended action by Lender with respect to the Collateral sent to
Borrower in accordance with the provisions hereof at least ten (10) business
days prior to such action, shall, except as otherwise provided by applicable
law, constitute commercially reasonable notice to Borrower. The proceeds of any
disposition of the Collateral, or any part thereof, may, except as otherwise
required by applicable law, be applied by Lender to the payment of the Debt in
such priority and proportions as Lender in its discretion shall deem proper.
Borrower’s (Debtor’s) principal place of business is as set forth on page one
hereof and the address of Lender (Secured Party) is as set forth on page one
hereof.


1.4           Fixture Filing. Certain of the Property is or will
become “fixtures” (as that term is defined in the Uniform Commercial Code) on
the Land, described or referred to in this Security Instrument, and this
Security Instrument, upon being filed for record in the real estate records of
the city or county wherein such fixtures are situated, shall operate also as a
financing statement filed as a fixture filing in accordance with the applicable
provisions of said Uniform Commercial Code upon such of the Property that is or
may become fixtures.


The Borrower hereby
authorizes the Lender at any time and from time to time to file any initial
financing statements, amendments thereto and continuation statements with or
without the signature of the Borrower as authorized by applicable law, as
applicable to all or part of the fixtures or Personal Property. For purposes of
such filings, the Borrower agrees to furnish any information requested by the
Lender promptly upon request by the Lender. The Borrower also ratifies its
authorization for the Lender to have filed any like initial financing
statements, amendments thereto and continuation statements, if filed prior to
the date of this Security Instrument. The Borrower hereby irrevocably
constitutes and appoints the Lender and any officer or agent of the Lender,
with full power of substitution, as its true and lawful attorneys- in-fact 



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with
full irrevocable power and authority in the place and stead of the Borrower or
in the Borrower’s own name to execute in the Borrower’s name any documents and
otherwise to carry out the purposes of this Section 1.4, to the extent that the
Borrower’s authorization above is not sufficient. To the extent permitted by
law, the Borrower hereby ratifies all acts said attorneys-in-fact have lawfully
done in the past or shall lawfully do or cause to be done in the future by
virtue hereof. This power of attorney is coupled with an interest and shall be
irrevocable.


1.5                Pledges of Monies Held. Borrower hereby pledges to Lender any and
all monies now or hereafter held by Lender or on behalf of Lender, including,
without limitation, any sums deposited in the Lockbox Account (if any), the
Reserve Funds and Net Proceeds, as additional security for the Obligations
until expended or applied as provided in this Security Instrument or in the
Loan Agreement.


1.6                Grants to MERS. This Security Instrument and the benefit of
the grants, assignments and transfers made to Trustee in this Article I shall
inure to MERS solely in its capacity as Lender’s nominee.


CONDITIONS TO GRANT


TO HAVE AND TO HOLD the
above granted and described Property unto Trustee, as trustee for the benefit
of MERS, as nominee of Lender, and to its successors in trust and assigns,
forever;


IN TRUST, WITH THE POWER OF
SALE, to secure payment to Lender of the Debt at the time and in the manner
provided for in the Note, the Loan Agreement, and this Security Instrument;


PROVIDED, HOWEVER, these
presents are upon the express condition that, if Borrower shall well and truly
pay to Lender the Debt at the time and in the manner provided in the Note, the
Loan Agreement and this Security Instrument, shall well and truly perform the
Other Obligations as set forth in this Security Instrument and shall well and
truly abide by and comply with each and every covenant and condition set forth
herein and in the Note, the Loan Agreement and the other Loan Documents, these
presents and the estate hereby granted shall cease, terminate and be void, and
Trustee shall reconvey the estate hereby granted pursuant to Section 15.10
hereof.


ARTICLE II


DEBT AND
OBLIGATIONS SECURED


2.1           Debt. This Security Instrument and the grants,
assignments and transfers made in Article 1 are given for the purpose of
securing the debt evidenced by the Note (the “Debt”).



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2.2          Other Obligations. This Security Instrument and the
grants, assignments and transfers made in Article 1 are also given for the
purpose of securing the following (the “Other
Obligations”):


(a)   the performance of all other obligations of Borrower contained herein;


(b)  the performance of each obligation of Borrower contained in the Loan
Agreement and any other Loan Document; and


(c)   the performance of each obligation of Borrower contained in any renewal,
extension, amendment, modification, consolidation, change of, or substitution
or replacement for, all or any part of the Note, the Loan Agreement or any
other Loan Document.


2.3          Debt
and Other Obligations. Borrower’s obligations for the payment of the Debt
and the performance of the Other Obligations shall be referred to collectively
herein as the “Obligations.”


ARTICLE III



BORROWER
COVENANTS


Borrower covenants and agrees that:


3.1                Payment of Debt. Borrower will pay the Debt at the time and
in the manner provided in the Loan Agreement, the Note and this Security
Instrument.


3.2          Incorporation by Reference. All the covenants, conditions and
agreements contained in (a) the Loan Agreement, (b) the Note and (c) all and
any of the other Loan Documents, are hereby made a part of this Security
Instrument to the same extent and with the same force as if fully set forth
herein, and in the event of a conflict between the terms hereof and the terms
of the Loan Agreement, the terms of the Loan Agreement shall control.


3.3          Insurance. Borrower shall obtain and maintain, or cause to be maintained, in
full force and effect at all times insurance with respect to Borrower and the
Property as required pursuant to the Loan Agreement.


3.4          Maintenance of Property. Borrower shall cause the Property to be
maintained in a good and safe condition and repair. The Improvements, the
Fixtures, the Equipment and the Personal Property shall not be removed,
demolished or materially altered except as provided for in the Loan Agreement
(except for normal replacement of the Fixtures, the Equipment or the Personal
Property, tenant finish and refurbishment of the Improvements) without the
consent of Lender as provided for in the Loan Agreement. Borrower shall
promptly repair, replace or rebuild any part of the Property which may be
destroyed by any casualty, or become damaged, worn or dilapidated and shall
complete and pay for any structure at any time in the process of construction
or repair on the Land except as set forth in the Loan Agreement.



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3.5          Waste. Borrower shall not commit or suffer any waste of the Property or make
any change in the use of the Property which will in any way materially increase
the risk of fire or other hazard arising out of the operation of the Property,
or take any action that might invalidate or allow the cancellation of any
Policy, or do or permit to be done thereon anything that may in any way
materially impair the value of the Property or the security of this Security
Instrument. Borrower will not, without the prior written consent of Lender,
permit any drilling or exploration for or extraction, removal, or production of
any minerals from the surface or the subsurface of the Land, regardless of the
depth thereof or the method of mining or extraction thereof.


3.6          Payment for Labor and Materials. (a) Subject to the terms, provisions and
conditions of the Loan Agreement, Borrower will promptly pay or cause to be
paid when due all bills and costs for labor, materials, and specifically
fabricated materials (“Labor and Material Costs”) incurred
in connection with the Property and never permit to exist beyond the due date
thereof in respect of the Property or any part thereof any lien or security
interest, even though inferior to the liens and the security interests hereof,
and in any event never permit to be created or exist in respect of the Property
or any part thereof any other or additional lien or security interest other
than the liens or security interests hereof except for the Permitted
Encumbrances.


(b)  Subject to the terms, provisions and conditions of the Loan
Agreement, after prior written notice to Lender, Borrower, or any tenant of the
Property pursuant to the terms of such tenant’s lease, at its own expense, may
contest by appropriate legal proceeding, promptly initiated and conducted in
good faith and with due diligence, the amount or validity or application in
whole or in part of any of the Labor and Material Costs, provided that (i) no
Event of Default has occurred and is continuing under the Loan Agreement, the
Note, this Security Instrument or any of the other Loan Documents, (ii)
Borrower is permitted to do so under the provisions of any other mortgage, deed
of trust or deed to secure debt affecting the Property, (iii) such proceeding
shall suspend the collection of the Labor and Material Costs from Borrower and
from the Property or Borrower shall have paid all of the Labor and Material
Costs under protest, (iv) such proceeding shall be permitted under and be
conducted in accordance with the provisions of any other instrument to which
Borrower is subject and shall not constitute a default thereunder, (v) neither
the Property nor any part thereof or interest therein will be in danger of
being sold, forfeited, terminated, canceled or lost, and (vi) Borrower shall
have furnished the security as may be required in the proceeding, or as may be
reasonably requested by Lender to insure the payment of any contested Labor and
Material Costs, together with all interest and penalties thereon.


3.7          Performance
of Other Agreements. Borrower shall observe and perform each and every
term, covenant and provision to be observed or performed by Borrower pursuant to
the Loan Agreement, any other Loan Document and any other agreement or recorded
instrument affecting or pertaining to the Property and any amendments,
modifications or changes thereto.



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3.8                Change of Name,
Identity or Structure. Except as set forth in the Loan Agreement, Borrower
shall not change Borrower’s name, identity (including its trade name or names) or, if not an
individual, Borrower’s corporate, partnership or other structure without notifying Lender of
such change in writing at least thirty (30) days prior to the effective date of
such change
and, in the case of a change in Borrower’s structure, without first obtaining
the prior written consent of
Lender which consent will not be unreasonably withheld, delayed or conditioned provided that such action is
otherwise in compliance with the Loan Agreement. Borrower shall execute and
deliver to Lender, prior to or contemporaneously with the effective date of any such change, any financing statement
or financing statement change reasonably required by Lender to establish or maintain the validity, perfection
and priority of the security interest
granted herein. At the request of Lender, Borrower shall execute a certificate
in form reasonably satisfactory to Lender listing the trade names under
which Borrower intends to operate the
Property, and representing and warranting that Borrower does business under no other
trade name with respect to the Property.


3.9                Title. Borrower has good,
marketable and insurable fee simple title to the real property comprising part of the Property and
good title to the balance of such Property, free and clear of all Liens (as
defined in the Loan Agreement) whatsoever except the Permitted Encumbrances (as
defined in the Loan Agreement), such other Liens as are permitted pursuant to the Loan Documents and
the Liens created by the Loan Documents. To Borrower’s actual knowledge, the Permitted
Encumbrances in the aggregate do not materially adversely affect the value, operation or use
of the Property of Borrower’s ability to repay the Loan. This Security Instrument, when
properly recorded in the appropriate records, together with any Uniform
Commercial Code financing statements required to be filed in connection
therewith, will create (a) a valid, perfected first priority lien, security
title and security interest on the Property, to the extent such security
interests can be perfected by filing; subject only to any applicable Permitted
Encumbrances, such other Liens as are permitted pursuant to the Loan Documents
and the Liens created by the Loan Documents. There are no claims for payment
for work, labor or materials affecting the Property which are past due and are or may
become a lien prior to, or of equal priority with, the Liens created by the
Loan Documents unless such claims for payments are being contested in
accordance with the terms and conditions of this Security Instrument.


3.10              Letter of Credit Rights. If Borrower is at any
time a beneficiary under a letter of credit relating to the properties, rights,
titles and interests referenced in Section 1.1 of this Security Instrument
now or hereafter issued in favor of Borrower, Borrower shall promptly notify Lender thereof
and, at the request and option of Lender, Borrower shall, pursuant to an
agreement in form and substance satisfactory to Lender, either (i) arrange for
the issuer and any confirmer of such letter of credit to consent to an assignment
to Lender of the proceeds of any drawing
under the letter of credit or (ii) arrange for the Lender to become the
transferee beneficiary of the letter of
credit, with Lender agreeing, in each case that the proceeds of any drawing under the letter of credit are to be
applied as provided in Section 7.2 of this Security Instrument.



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ARTICLE IV


OBLIGATIONS
AND RELIANCES


4.1                Relationship of Borrower and Lender. The relationship between Borrower and
Lender is solely that of debtor and creditor, and Lender has no fiduciary or
other special relationship with Borrower, and no term or condition of any of
the Loan Agreement, the Note, this Security Instrument and the other Loan
Documents shall be construed so as to deem the relationship between Borrower
and Lender to be other than that of debtor and creditor.


4.2         No Reliance on Lender. The general partners, members, principals
and (if Borrower is a trust) beneficial owners of Borrower are experienced in
the ownership and operation of properties similar to the Property, and Borrower
and Lender are relying solely upon such expertise and business plan in
connection with the ownership and operation of the Property. Borrower is not
relying on Lender’s expertise, business acumen or advice in connection with the
Property.


4.3         No Lender Obligations. (a) Notwithstanding the provisions of
Subsections 1.1(h) and (n) or Section 1.2, Lender is not undertaking the
performance of (i) any obligations under the Leases; or (ii) any obligations
with respect to such agreements, contracts, certificates, instruments,
franchises, permits, trademarks, licenses and other documents.


(b)  By accepting or approving anything required to be observed,
performed or fulfilled or to be given to Lender pursuant to this Security
Instrument, the Loan Agreement, the Note or the other Loan Documents,
including, without limitation, any officer’s certificate, balance sheet,
statement of profit and loss or other financial statement, survey, appraisal,
or insurance policy, Lender shall not be deemed to have warranted, consented
to, or affirmed the sufficiency, the legality or effectiveness of same, and
such acceptance or approval thereof shall not constitute any warranty or
affirmation with respect thereto by Lender.


4.4         Reliance. Borrower recognizes and acknowledges that
in accepting the Loan Agreement, the Note, this Security Instrument and the
other Loan Documents, Lender is expressly and primarily relying on the truth
and accuracy of the warranties and representations set forth in Section 4.1 of
the Loan Agreement without any obligation to investigate the Property and
notwithstanding any investigation of the Property by Lender; that such reliance
existed on the part of Lender prior to the date hereof, that the warranties and
representations are a material inducement to Lender in making the Loan; and
that Lender would not be willing to make the Loan and accept this Security
Instrument in the absence of the warranties and representations as set forth in
Section 4.1 of the Loan Agreement.



 11
 






 



ARTICLE V 


FURTHER
ASSURANCES


5.1                Recording of Security Instrument, Etc. Borrower forthwith upon the execution and
delivery of this Security Instrument and thereafter, from time to time, will
cause this Security Instrument and any of the other Loan Documents creating a
lien or security interest or evidencing the lien hereof upon the Property and
each instrument of further assurance to be filed, registered or recorded in
such manner and in such places as may be required by any present or future law
in order to publish notice of and fully to protect and perfect the lien or
security interest hereof upon, and the interest of Lender in, the Property.
Borrower will pay all taxes, filing, registration or recording fees, and all
expenses incident to the preparation, execution, acknowledgment and/or
recording of the Note, this Security Instrument, the other Loan Documents, any
note, deed of trust or mortgage supplemental hereto, any security instrument
with respect to the Property and any instrument of further assurance, and any
modification or amendment of the foregoing documents, and all federal, state,
county and municipal taxes, duties, imposts, assessments and charges arising
out of or in connection with the execution and delivery of this Security
Instrument, any deed of trust or mortgage supplemental hereto, any security
instrument with respect to the Property or any instrument of further assurance,
and any modification or amendment of the foregoing documents, except where
prohibited by law so to do.


5.2         Further Acts, Etc. Borrower will, at the cost of Borrower, and
without expense to Lender, do, execute, acknowledge and deliver all and every
such further acts, deeds, conveyances, deeds of trust, mortgages, assignments,
notices of assignments, transfers and assurances as Lender shall, from time to
time, reasonably require, for the better assuring, conveying, assigning,
transferring, and confirming unto Lender the property and rights hereby
mortgaged, deeded, granted, bargained, sold, conveyed, confirmed, pledged,
assigned, warranted and transferred or intended now or hereafter so to be, or
which Borrower may be or may hereafter become bound to convey or assign to
Lender, or for carrying out the intention or facilitating the performance of
the terms of this Security Instrument or for filing, registering or recording
this Security Instrument, or for complying with all Legal Requirements.
Borrower, on demand, will execute and deliver, and in the event it shall fail
to so execute and deliver, hereby authorizes Lender to execute in the name of
Borrower or without the signature of Borrower to the extent Lender may lawfully
do so, one or more financing statements to evidence more effectively the
security interest of Lender in the Property. Borrower grants to Lender an
irrevocable power of attorney coupled with an interest for the purpose of
exercising and perfecting any and all rights and remedies available to Lender
at law and in equity following an Event of Default, including without
limitation such rights and remedies available to Lender pursuant to this
Section 5.2. Nothing contained in this Section 5.2 shall be deemed to create an
obligation on the part of Borrower to pay any costs and expenses incurred by
Lender in connection with the Securitization or other sale or transfer of the
Loan.


5.3         Changes in Tax, Debt, Credit and Documentary
Stamp Laws. (a) If any law
is enacted or adopted or amended after the date of this Security Instrument
which deducts the Debt from the value of the Property for the purpose of
taxation or which imposes a tax, either directly or indirectly, on the Debt or
Lender’s interest in the Property, Borrower will pay the tax, with interest and
penalties thereon, if any.  If Lender is
advised by counsel chosen by it that the



 12
 






 



payment of tax by Borrower would be unlawful or
taxable to Lender or unenforceable or provide the basis for a defense of usury
then Lender shall have the option by written notice of not less than one
hundred eighty (180) days to declare the Debt immediately due and payable.


(b)   Borrower will not claim or demand or be entitled to any credit or
credits on account of the Debt for any part of the Taxes or Other Charges
assessed against the Property, or any part thereof, and no deduction shall
otherwise be made or claimed from the assessed value of the Property, or any
part thereof, for real estate tax purposes by reason of this Security
Instrument or the Debt. If such claim, credit or deduction shall be required by
law, Lender shall have the option, by written notice of not less than one
hundred eighty (180) days, to declare the Debt immediately due and payable.


(c)   If at any time the United States of America, any State thereof or any
subdivision of any such State shall require revenue or other stamps to be
affixed to the Note, this Security Instrument, or any of the other Loan
Documents or impose any other tax or charge on the same, Borrower will pay for
the same, with interest and penalties thereon, if any.


5.4          Splitting of Security Instrument. The provisions of Section 9.7 of the Loan
Agreement are hereby incorporated by reference herein.


5.5          Replacement Documents. Upon receipt of an affidavit of an officer
of Lender as to the loss, theft, destruction or mutilation of the Note or any
other Loan Document which is not of public record, and, in the case of any such
mutilation, upon surrender and cancellation of such Note or other Loan
Document, Borrower will issue, in lieu thereof, a replacement Note or other
Loan Document, dated the date of such lost, stolen, destroyed or mutilated Note
or other Loan Document in the same principal amount thereof and otherwise of
like tenor.


ARTICLE VI


DUE ON
SALE/ENCUMBRANCE


6.1           Lender Reliance. Borrower acknowledges that Lender
has examined and relied on the experience of Borrower and its general partners,
members, principals and (if Borrower is a trust) beneficial owners in owning
and operating properties such as the Property in agreeing to make the Loan, and
will continue to rely on Borrower’s ownership of the Property as a means of
maintaining the value of the Property as security for repayment of the Debt and
the performance of the Other Obligations. Borrower acknowledges that Lender has
a valid interest in maintaining the value of the Property so as to ensure that,
should Borrower default in the repayment of the Debt or the performance of the
Other Obligations, Lender can recover the Debt by a sale of the Property
conducted in accordance with the terms of the Loan Documents and applicable
law.



 13
 






 



6.2          No Sale/Encumbrance. Except as set forth in Section 5.2.13 of
the Loan Agreement, Borrower agrees that Borrower shall not, without the prior
written consent of Lender, sell, convey, mortgage, grant, bargain, encumber,
pledge, assign, or otherwise transfer the Property or any part thereof,
including, but not limited to, a grant of an easement, restriction, covenant,
reservation or right of way (except as expressly permitted in Section 5.2.13 of
the Loan Agreement), or permit the Property or any part thereof to be sold,
conveyed, mortgaged, granted, bargained, encumbered, pledged, assigned, or otherwise
transferred, unless Lender shall consent thereto in accordance with Section 6.4
hereof.


6.3          Sale/Encumbrance Defined. Except as permitted pursuant to the terms
of Section 5.2.13 of the Loan Agreement, a sale, conveyance, mortgage, grant,
bargain, encumbrance, pledge, assignment, or transfer within the meaning of
this Article 6 shall be deemed to include, but not be limited to, (a) an
installment sales agreement wherein Borrower agrees to sell the Property or any
part thereof for a price to be paid in installments; (b) an agreement by
Borrower leasing all or a substantial part of the Property for other than
actual occupancy by a space tenant thereunder or a sale, assignment or other
transfer of, or the grant of a security interest in, Borrower’s right, title
and interest in and to any Leases or any Rents; (c) the voluntary or
involuntary sale, conveyance, transfer or pledge of the stock of the general
partner of Borrower (or the stock of any corporation directly or indirectly
controlling such general partner by operation of law or otherwise) or the
creation or issuance of new stock by which an aggregate of more than ten
percent (10%) of such general partner’s stock shall be vested in a party or
parties who are not now stockholders; (d) the voluntary or involuntary sale,
conveyance, transfer or pledge of any general or limited partnership interest
in Borrower; (e) if Borrower, any general partner of Borrower, any guarantor or
any indemnitor is a limited liability company, the change, removal or resignation
of a member or managing member or the transfer or pledge of the interest of any
member or managing member or any profits or proceeds relating to such interest;
or (f) any other transfer prohibited by the terms of the Loan Agreement.


6.4          Lender’s Rights. Except as set forth in the Loan Agreement,
Lender reserves the right to condition the consent required hereunder upon (a)
a modification of the terms hereof and of the Loan Agreement, the Note or the
other Loan Documents; (b) an assumption of the Loan Agreement, the Note, this
Security Instrument and the other Loan Documents as so modified by the proposed
transferee, subject to the provisions of Section 9.4 of the Loan Agreement; (c)
payment of all of Lender’s reasonable expenses incurred in connection with such
transfer including, without limitation, the cost of any third party reports,
legal fees, rating agency or required legal opinions; (d) the payment of an
assumption fee equal to one percent (1%) of the outstanding principal balance
of the Loan; (e) the confirmation in writing by the applicable Rating Agencies
that the proposed transfer will not, in and of itself, result in a downgrade,
qualification or withdrawal of the initial, or, if higher, then current ratings
assigned in connection with any Securitization; (f) intentionally deleted; (g)
the proposed transferee’s continued compliance with the representations and
covenants set forth in Section 4.1.30 and 5.2.12 of the Loan Agreement; (h) the
delivery of evidence satisfactory to Lender that the single purpose nature and
bankruptcy remoteness of Borrower following such transfers are in accordance
with the then current standards of Lender and the Rating Agencies, or (i) such
other



 14
 






 



conditions as Lender shall determine in its
reasonable discretion to be in the interest of Lender, including, without
limitation, the creditworthiness, reputation and qualifications of the
transferee with respect to the Loan and the Property. Lender shall not be
required to demonstrate any actual impairment of its security or any increased
risk of default hereunder in order to declare the Debt immediately due and
payable upon Borrower’s sale, conveyance, mortgage, grant, bargain,
encumbrance, pledge, assignment, or transfer of the Property without Lender’s
consent (to the extent such consent is required hereunder or under the Loan
Agreement). This provision shall apply to every sale, conveyance, mortgage,
grant, bargain, encumbrance, pledge, assignment, or transfer of the Property
regardless of whether voluntary or not, or whether or not Lender has consented
to any previous sale, conveyance, mortgage, grant, bargain, encumbrance,
pledge, assignment, or transfer of the Property.


ARTICLE VII


RIGHTS AND
REMEDIES UPON DEFAULT


7.1           Remedies. Upon the occurrence and during the
continuance of any Event of Default, Borrower agrees that Lender or Trustee may
take such action, without notice or demand, as it deems advisable to protect
and enforce its rights against Borrower and in and to the Property, including,
but not limited to, the following actions, each of which may be pursued
concurrently or otherwise, at such time and in such order as Lender or Trustee
may determine, in its sole discretion, without impairing or otherwise affecting
the other rights and remedies of Lender or Trustee:


(a)   declare the entire unpaid Debt to be immediately due and payable;


(b)   institute proceedings, judicial or otherwise, for the complete
foreclosure of this Security Instrument under any applicable provision of law,
in which case the Property or any interest therein may be sold for cash or upon
credit in one or more parcels or in several interests or portions and in any
order or manner;


(c)   with or without entry, to the extent permitted and pursuant to the
procedures provided by applicable law, institute proceedings for the partial
foreclosure of this Security Instrument for the portion of the Debt then due
and payable, subject to the continuing lien and security interest of this
Security Instrument for the balance of the Debt not then due, unimpaired and without
loss of priority;


(d)   sell for cash or upon credit the Property or any part thereof and all
estate, claim, demand, right, title and interest of Borrower therein and rights
of redemption thereof, pursuant to power of sale or otherwise, at one or more sales,
as an entity or in parcels, at such time and place, upon such terms and after
such notice thereof as may be required or permitted by law;



 15
 






 



(e)  institute an action, suit or proceeding in equity for the specific
performance of any covenant, condition or agreement contained herein, in the
Note, the Loan Agreement or in the other Loan Documents;


(f)   recover judgment on the Note either before, during or after any
proceedings for the enforcement of this Security Instrument or the other Loan
Documents;


(g)  apply for the appointment of a receiver, trustee, liquidator or
conservator of the Property, without notice and without regard for the adequacy
of the security for the Debt and without regard for the solvency of Borrower,
any guarantor, indemnitor with respect to the Loan or of any Person, liable for
the payment of the Debt;


(h)  the license granted to Borrower under Section 1.2 hereof shall
automatically be revoked and Lender may, to the extent permitted pursuant to
procedures provided by applicable law, enter into or upon the Property, either
personally or by its agents, nominees or attorneys and dispossess Borrower and
its agents and servants therefrom, without liability for trespass, damages or
otherwise and exclude Borrower and its agents or servants wholly therefrom, and
take possession of all books, records and accounts relating thereto and
Borrower agrees to surrender possession of the Property and of such books,
records and accounts to Lender upon demand, and thereupon Lender may (i) use,
operate, manage, control, insure, maintain, repair, restore and otherwise deal
with all and every part of the Property and conduct the business thereat; (ii)
complete any construction on the Property in such manner and form as Lender
deems advisable; (iii) make alterations, additions, renewals, replacements and
improvements to or on the Property; (iv) exercise all rights and powers of
Borrower with respect to the Property, whether in the name of Borrower or
otherwise, including, without limitation, the right to make, cancel, enforce or
modify Leases, obtain and evict tenants, and demand, sue for, collect and
receive all Rents of the Property and every part thereof; (v) require Borrower
to pay monthly in advance to Lender, or any receiver appointed to collect the
Rents, the fair and reasonable rental value for the use and occupation of such
part of the Property as may be occupied by Borrower; (vi) require Borrower to
vacate and surrender possession of the Property to Lender or to such receiver
and, in default thereof, Borrower may be evicted by summary proceedings or
otherwise; and (vii) apply the receipts from the Property to the payment of the
Debt, in such order, priority and proportions as Lender shall deem appropriate
in its sole discretion after deducting therefrom all expenses (including
reasonable attorneys’ fees) incurred in connection with the aforesaid
operations and all amounts necessary to pay the Taxes, Other Charges, insurance
and other expenses in connection with the Property, as well as just and
reasonable compensation for the services of Lender, its counsel, agents and
employees;


(i)   exercise any and all rights and remedies granted to a secured
party upon default under the Uniform Commercial Code, including, without
limiting the generality of the foregoing: (i) the right to take possession of
the Fixtures, the Equipment, the Personal Property or any part thereof, and to
take such other measures as Lender may deem necessary for the care, protection
and preservation of the Fixtures, the Equipment, the Personal Property, and
(ii) request Borrower at its expense to assemble the Fixtures, the Equipment,
the Personal Property



 16
 






 



and make it available to Lender at a convenient
place acceptable to Lender. Any notice of sale, disposition or other intended
action by Lender with respect to the Fixtures, the Equipment, the Personal
Property sent to Borrower in accordance with the provisions hereof at least
five (5) days prior to such action, shall constitute commercially reasonable
notice to Borrower;


(j)   apply any sums then deposited or held in escrow or otherwise by or
on behalf of Lender in accordance with the terms of the Loan Agreement, this
Security Instrument or any other Loan Document to the payment of the following
items in any order in its uncontrolled discretion:


(i) Taxes and Other Charges;


(ii) Insurance Premiums;


(iii) Interest on the unpaid
principal balance of the Note;


(iv) Amortization of the
unpaid principal balance of the Note;


(v) All other sums payable pursuant to the Note, the Loan Agreement,
this Security Instrument and the other Loan Documents, including without
limitation advances made by Lender pursuant to the terms of this Security
Instrument;


(k)  pursue such other remedies as Lender may have under applicable law;
or


(1)  apply the undisbursed balance of any Net Proceeds Deficiency
deposit, together with interest thereon, to the payment of the Debt in such
order, priority and proportions as Lender shall deem to be appropriate in its
discretion.


In the event of a sale, by foreclosure, power of
sale or otherwise, of less than all of Property, this Security Instrument shall
continue as a lien and security interest on the remaining portion of the
Property unimpaired and without loss of priority.


7.2          Application of Proceeds. The purchase money, proceeds and avails of
any disposition of the Property, and or any part thereof, or any other sums
collected by Lender pursuant to the Note, this Security Instrument or the other
Loan Documents, may be applied by Lender to the payment of the Debt in such
priority and proportions as Lender in its discretion shall deem proper.


7.3          Right to Cure Defaults. Upon the occurrence and during the
continuance of any Event of Default or if Borrower fails to make any payment or
to do any act as herein provided, Lender may, but without any obligation to do
so and without notice to or demand on Borrower and without releasing Borrower
from any obligation hereunder, make or do the same in such manner and to such
extent as Lender may deem necessary to protect the security hereof. Lender is
authorized to enter upon action or proceeding to the Property for such
purposes, or appear in, defend, or bring any action or proceeding to protect
its interest in the Property or to



 17
 






 



foreclose this Security Instrument or collect the
Debt, and the cost and expense thereof (including reasonable attorneys’ fees to
the extent permitted by law), with interest as provided in this Section 7.3,
shall constitute a portion of the Debt and shall be due and payable to Lender
upon demand. All such costs and expenses incurred by Lender in remedying such
Event of Default or such failed payment or act or in appearing in, defending,
or bringing any such action or proceeding shall bear interest at the Default
Rate, for the period after notice from Lender that such cost or expense was
incurred to the date of payment to Lender. All such costs and expenses incurred
by Lender together with interest thereon calculated at the Default Rate shall
be deemed to constitute a portion of the Debt and be secured by this Security
Instrument and the other Loan Documents and shall be immediately due and
payable upon demand by Lender therefor.


7.4          Actions and Proceedings. Lender has the right to appear in and
defend any action or proceeding brought with respect to the Property and to
bring any action or proceeding, in the name and on behalf of Borrower, which
Lender, in its discretion, decides should be brought to protect its interest in
the Property.


7.5          Recovery of Sums Required To be Paid. Lender shall have the right from time to
time to take action to recover any sum or sums which constitute a part of the
Debt as the same become due, without regard to whether or not the balance of
the Debt shall be due, and without prejudice to the right of Lender thereafter
to bring an action of foreclosure, or any other action, for a default or
defaults by Borrower existing at the time such earlier action was commenced.


7.6          Examination of Books and Records. At reasonable times and upon reasonable
notice, Lender, its agents, accountants and attorneys shall have the right to
examine the records, books, management and other papers of Borrower which
reflect upon their financial condition, at the Property or at any office
regularly maintained by Borrower where the books and records are located.
Lender and its agents shall have the right to make copies and extracts from the
foregoing records and other papers. In addition, at reasonable times and upon
reasonable notice, Lender, its agents, accountants and attorneys shall have the
right to examine and audit the books and records of Borrower pertaining to the
income, expenses and operation of the Property during reasonable business hours
at any office of Borrower where the books and records are located. This Section
7.6 shall apply throughout the term of the Note and without regard to whether
an Event of Default has occurred or is continuing. Unless an Event of Default
shall be continuing, in which event the action contemplated by this Section 7.6
shall be at Borrower’s sole costs and expenses hereunder.


7.7          Other Rights. Etc. (a) The failure of Lender to
insist upon strict performance of any term hereof shall not be deemed to be a
waiver of any term of this Security Instrument. Borrower shall not be relieved
of Borrower’s obligations hereunder by reason of (i) the failure of Lender to
comply with any request of Borrower or any guarantor or indemnitor with respect
to the Loan to take any action to foreclose this Security Instrument or
otherwise enforce any of the provisions hereof or of the Note or the other Loan
Documents, (ii) the release, regardless of consideration, of the whole or any
part of the Property, or of any person liable for



 18














 


the Debt or any portion
thereof, or (iii) any agreement or stipulation by Lender extending the time of
payment or otherwise modifying or supplementing the terms of the Note, this
Security Instrument or the other Loan Documents.


(b)  It is agreed that the risk of loss or damage
to the Property is on Borrower, and Lender shall have no liability whatsoever
for decline in value of the Property, for failure to maintain the Policies, or
for failure to determine whether insurance in force is adequate as to the amount
of risks insured. Possession by Lender shall not be deemed an election of
judicial relief, if any such possession is requested or obtained, with respect
to any Property or collateral not in Lender’s possession.


(c)  Lender or Trustee may resort for the payment
of the Debt to any other security held by Lender or Trustee in such order and
manner as Lender or Trustee, in its discretion, may elect. Lender or Trustee
may take action to recover the Debt, or any portion thereof, or to enforce any
covenant hereof without prejudice to the right of Lender or Trustee thereafter
to foreclose this Security Instrument. The rights of Lender or Trustee under
this Security Instrument shall be separate, distinct and cumulative and none
shall be given effect to the exclusion of the others. No act of Lender or
Trustee shall be construed as an election to proceed under any one provision
herein to the exclusion of any other provision. Lender or Trustee shall not be
limited exclusively to the rights and remedies herein stated but shall be
entitled to every right and remedy now or hereafter afforded at law or in
equity.


7.8           Right to Release Any Portion of the Property. Lender may release any portion of the
Property for such consideration as Lender may require without, as to the remainder
of the Property, in any way impairing or affecting the lien or priority of this
Security Instrument, or improving the position of any subordinate lienholder
with respect thereto, except to the extent that the obligations hereunder shall
have been reduced by the actual monetary consideration, if any, received by
Lender for such release, and may accept by assignment, pledge or otherwise any
other property in place thereof as Lender may require without being accountable
for so doing to any other lienholder. This Security Instrument shall continue
as a lien and security interest in the remaining portion of the Property.


7.9          Violation of Laws. If the Property is not in material
compliance with Legal Requirements, Lender may impose additional requirements upon
Borrower in connection herewith including, without limitation, monetary
reserves or financial equivalents.


7.10        Recourse and Choice of Remedies. Notwithstanding any other provision of this Security Instrument or
the Loan Agreement, including, without limitation, Section 9.4 of the Loan
Agreement, Lender and other Indemnified Parties (as hereinafter defined) are
entitled to enforce the obligations of Borrower, any guarantor or indemnitor
contained in Sections 9.2, 9.3 and 9.4 herein and Section 9.4 of the Loan
Agreement without first resorting to or exhausting any security or collateral
and without first having recourse to the Note or any of the Property, through
foreclosure or acceptance of a deed in lieu of foreclosure or otherwise, and in
the event Lender commences a foreclosure action against the Property, Lender is
entitled to pursue a



 19
 






 



deficiency judgment with respect to such obligations
against Borrower and any guarantor or indemnitor with respect to the Loan. The
provisions of Sections 9.2, 9.3 and 9.4 herein and Section 9.4 of the Loan
Agreement are exceptions to any non-recourse or exculpation provisions in the
Loan Agreement, the Note, this Security Instrument or the other Loan Documents,
and Borrower and any guarantor or indemnitor with respect to the Loan are fully
and personally liable for the obligations pursuant to Sections 9.2, 9.3 and 9.4
herein and Section 9.4 of the Loan Agreement. The liability of Borrower and any
guarantor or indemnitor with respect to the Loan pursuant to Sections 9.2, 9.3
and 9.4 herein and Section 9.4 of the Loan Agreement is not limited to the
original principal amount of the Note. Notwithstanding the foregoing, nothing
herein shall inhibit or prevent Lender from foreclosing or exercising any other
rights and remedies pursuant to the Loan Agreement, the Note, this Security
Instrument and the other Loan Documents, whether simultaneously with
foreclosure proceedings or in any other sequence. A separate action or actions
may be brought and prosecuted against Borrower pursuant to Sections 9.2, 9.3
and 9.4 herein and Section 9.4 of the Loan Agreement, whether or not action is
brought against any other Person or whether or not any other Person is joined
in the action or actions. In addition, Lender shall have the right but not the
obligation to join and participate in, as a party if it so elects, any
administrative or judicial proceedings or actions initiated in connection with
any matter addressed in Article 8 or Section 9.4 herein.


7.11         Right of Entry. Upon reasonable notice to Borrower, Lender
and its agents shall have the right to enter and inspect the Property at all
reasonable times.


7.12         Release. Upon payment of all sums secured by this
Security Instrument, the Lender shall release this Security Instrument. The
Borrower shall pay the Lender’s reasonable costs incurred in releasing this
Security Instrument.


7.13         References to Lender. Notwithstanding anything to the contrary
contained herein or in any of the other Loan Documents, all references herein
to “Lender” shall be deemed to collectively or individually (as the context
requires) refer to Lender or to MERS, acting on behalf of and at the sole
direction of Lender in its capacity as Lender’s nominee, as each of their
interests may appear; provided, that, unless Lender, in its sole discretion,
shall determine otherwise, only Lender (and not MERS) shall be deemed to be “Lender”
with respect to (a) any consent or similar approval right granted to Lender
hereunder or under any of the other Loan Documents (including, without limitation,
any consent or similar approval right that is deemed granted if not approved or
denied within a specified time period), (b) any items, documents or other
information required to be delivered to Lender hereunder or under any of the
other Loan Documents (other than notices expressly required to be sent to MERS)
or (c) any future funding or other obligations of Lender to Borrower or any
affiliate of Borrower hereunder or under any of the other Loan Documents, if
any.


7.14         Failure
to Act. Notwithstanding
anything to the contrary contained herein or in any of the other Loan
Documents, the failure of MERS to take any action hereunder or under any of the
other Loan Documents shall not (a) be deemed to be a waiver of any term or



 20
 






 



condition
of this Security Instrument or any of the other Loan Documents, or (b)
adversely affect any rights of Lender hereunder or under any of the other Loan
Documents.


ARTICLE VIII


ENVIRONMENTAL HAZARDS


8.1           Environmental
Representations and Warranties. To the best of Borrower’s knowledge, and
except as otherwise disclosed by that certain Environmental Site Assessment of
the Property delivered to Lender (such report is referred to below as the “Environmental Report”), Borrower hereby represents and
warrants (a) to the best of Borrower’s knowledge, based on the Environmental
Report, there are no Hazardous Substances (defined below) or underground
storage tanks in, on, or under the Property, except those that are both (i) in
compliance with Environmental Laws (defined below) and with permits issued
pursuant thereto and (ii) fully disclosed to Lender in writing pursuant the
Environmental Report; (b) there are no past, present or threatened Releases
(defined below) of Hazardous Substances in, on, under or from the Property
which has not been fully remediated in accordance with Environmental Law; (c)
there is no threat of any Release of Hazardous Substances migrating to the
Property; (d) there is no past or present non-compliance with Environmental
Laws, or with permits issued pursuant thereto, in connection with the Property
which has not been fully remediated in accordance with Environmental Law; (e)
Borrower does not know of, and has not received, any written or oral notice or
other communication from any Person (including but not limited to a
governmental entity) relating to Hazardous Substances or Remediation (defined
below) thereof, of possible liability of any Person pursuant to any
Environmental Law, other environmental conditions in connection with the
Property, or any actual or potential administrative or judicial proceedings in
connection with any of the foregoing; and (f) Borrower has truthfully and fully
provided to Lender, in writing, any and all information relating to conditions
in, on, under or from the Property that is known to Borrower and that is
contained in Borrower’s files and records, including but not limited to any
reports relating to Hazardous Substances in, on, under or from the Property
and/or to the environmental condition of the Property.


“Environmental Law” means
any present and future federal, state and local laws, statutes, ordinances,
rules, regulations and the like, as well as common law, relating to protection
of human health or the environment, relating to Hazardous Substances, relating
to liability for or costs of Remediation or prevention of Releases of Hazardous
Substances or relating to liability for or costs of other actual or threatened
danger to human health or the environment. Environmental Law includes, but is
not limited to, the following statutes, as amended, any successor thereto, and
any regulations promulgated pursuant thereto, and any state or local statutes,
ordinances, rules, regulations and the like addressing similar issues: the
Comprehensive Environmental Response, Compensation and Liability Act; the
Emergency Planning and Community Right-to-Know Act; the Hazardous Substances
Transportation Act; the Resource Conservation and Recovery Act (including but
not limited to Subtitle I relating to underground storage tanks); the Solid
Waste Disposal Act; the Clean Water Act; the Clean Air Act; the Toxic
Substances Control Act; the Safe Drinking Water Act; the Occupational Safety



 21
 






 



and
Health Act; the Federal Water Pollution Control Act; the Federal Insecticide,
Fungicide and Rodenticide Act; the Endangered Species Act; the National
Environmental Policy Act; and the River and Harbors Appropriation Act.
Environmental Law also includes, but is not limited to, any present and future
federal, state and local laws, statutes, ordinances, rules, regulations and the
like, as well as common law: conditioning transfer of property upon a negative
declaration or other approval of a governmental authority of the environmental
condition of the Property; requiring notification or disclosure of Releases of
Hazardous Substances or other environmental condition of the Property to any
governmental authority or other Person, whether or not in connection with
transfer of title to or interest in property; imposing conditions or
requirements in connection with permits or other authorization for lawful
activity; relating to nuisance, trespass or other causes of action related to
the Property; and relating to wrongful death, personal injury, or property or
other damage in connection with any physical condition or use of the Property.


“Hazardous Substances” include
but are not limited to any and all substances (whether solid, liquid or gas)
defined, listed, or otherwise classified as pollutants, hazardous wastes,
hazardous substances, hazardous materials, extremely hazardous wastes, or words
of similar meaning or regulatory effect under any present or future
Environmental Laws or that may have a negative impact on human health or the
environment, including but not limited to petroleum and petroleum products,
asbestos and asbestos-containing materials, polychlorinated biphenyls, lead,
radon, radioactive materials, flammables and explosives, but excluding
substances of kinds and in amounts ordinarily and customarily used or stored in
similar properties for the purpose of cleaning or other maintenance or
operations and otherwise in compliance with all Environmental Laws.


“Release” of
any Hazardous Substance includes but is not limited to any release, deposit,
discharge, emission, leaking, spilling, seeping, migrating, injecting, pumping,
pouring, emptying, escaping, dumping, disposing or other movement of Hazardous
Substances.


“Remediation” includes
but is not limited to any response, remedial, removal, or corrective action,
any activity to cleanup, detoxify, decontaminate, contain or otherwise
remediate any Hazardous Substance, any actions to prevent, cure or mitigate any
Release of any Hazardous Substance, any action to comply with any Environmental
Laws or with any permits issued pursuant thereto, any inspection,
investigation, study, monitoring, assessment, audit, sampling and testing,
laboratory or other analysis, or evaluation relating to any Hazardous
Substances or to anything referred to in Article 8.


8.2           Environmental
Covenants. Borrower covenants and agrees that: (a) all uses and operations
on or of the Property, whether by Borrower or any other Person, shall be in
compliance with all Environmental Laws and permits issued pursuant thereto; (b)
Borrower shall not cause or permit the Release of any Hazardous Substances in,
on, under or from the Property; (c) there shall be no Hazardous Substances in,
on, or under the Property, except those that are both (i) in compliance with
all Environmental Laws and with permits issued pursuant thereto and (ii) fully
disclosed to Lender in writing; (d) Borrower shall keep the Property free and
clear of all liens and other encumbrances imposed pursuant to any Environmental
Law, whether due to any



 22
 






 



act
or omission of Borrower or any other Person (the “Environmental Liens”); (e) Borrower shall, at its sole
cost and expense, fully and expeditiously cooperate in all activities pursuant
to Section 8.3 below, including but not limited to providing all relevant
information and making knowledgeable persons available for interviews; (f)
Borrower shall, at its sole cost and expense, perform any environmental site
assessment or other investigation of environmental conditions in connection
with the Property, pursuant to any reasonable written request of Lender made in
the event that Lender has a good faith reason to believe based upon credible
evidence or information that an environmental hazard exists on or affects the
Property (including but not limited to sampling, testing and analysis of soil,
water, air, building materials and other materials and substances whether
solid, liquid or gas), and share with Lender the reports and other results
thereof, and Lender and other Indemnified Parties shall be entitled to rely on
such reports and other results thereof; (g) Borrower shall, at its sole cost
and expense, comply with all reasonable written requests of Lender made in the
event that Lender has a good faith reason to believe based upon credible
evidence or information that an environmental hazard exists on or affects the
Property to (i) reasonably effectuate Remediation of any condition (including
but not limited to a Release of a Hazardous Substance) in, on, under or from
the Property; (ii) comply with any Environmental Law; (iii) comply with any
directive from any governmental authority; and (iv) take any other reasonable
action necessary or appropriate for protection of human health or the
environment; (h) Borrower shall not do or knowingly allow any tenant or other
user of the Property to do any act that materially increases the dangers to
human health or the environment, poses an unreasonable risk of harm to any
Person (whether on or off the Property), impairs or may impair the value of the
Property, is contrary to any requirement of any insurer, constitutes a public
or private nuisance, constitutes waste, or violates any covenant, condition,
agreement or easement applicable to the Property; and (i) Borrower shall
immediately notify Lender in writing of (A) any presence or Releases or
threatened Releases of Hazardous Substances in, on, under, from or migrating towards
the Property; (B) any non-compliance with any Environmental Laws related in any
way to the Property; (C) any actual or potential Environmental Lien; (D) any
required or proposed Remediation of environmental conditions relating to the
Property; and (E) any written or oral notice or other communication of which
Borrower becomes aware from any source whatsoever (including but not limited to
a governmental entity) relating in any way to Hazardous Substances or
Remediation thereof, possible liability of any Person pursuant to any
Environmental Law, other environmental conditions in connection with the
Property, or any actual or potential administrative or judicial proceedings in
connection with anything referred to in this Article 8.


8.3           Lender’s
Rights. In the event that Lender has a good faith reason to believe based
upon credible evidence or information that an environmental hazard exists on
the Property, upon reasonable notice from Lender, Borrower shall, at Borrower’s
expense, promptly cause an engineer or consultant satisfactory to Lender to
conduct any environmental assessment or audit (the scope of which shall be
determined in Lender’s sole and absolute discretion) and take any samples of
soil, groundwater or other water, air, or building materials or any other
invasive testing requested by Lender and promptly deliver the results of any
such assessment, audit, sampling or other testing; provided, however, if such
results are not delivered to Lender within a reasonable period, upon reasonable
notice to Borrower, Lender and any other Person



 23
 






 



designated
by Lender, including but not limited to any receiver, any representative of a
governmental entity, and any environmental consultant, shall have the right,
but not the obligation, to enter upon the Property at all reasonable times to
assess any and all aspects of the environmental condition of the Property and
its use, including but not limited to conducting any environmental assessment
or audit (the scope of which shall be determined in Lender’s sole and absolute
discretion) and taking samples of soil, groundwater or other water, air, or
building materials, and reasonably conducting other invasive testing. Borrower
shall cooperate with and provide access to Lender and any such Person
designated by Lender.


ARTICLE IX


INDEMNIFICATION


9.1           General
Indemnification. Borrower shall, at its sole cost and expense, protect,
defend, indemnify, release and hold harmless the Indemnified Parties from and
against any and all claims, suits, liabilities (including, without limitation,
strict liabilities), actions, proceedings, obligations, debts, damages, losses,
costs, expenses, diminutions in value, fines, penalties, charges, fees,
expenses, judgments, awards, amounts paid in settlement, punitive damages,
foreseeable and unforeseeable consequential damages, of whatever kind or nature
(including but not limited to reasonable attorneys’ fees and other costs of
defense) (collectively, the “Losses”)
imposed upon or incurred by or asserted against any Indemnified Parties and
directly or indirectly arising out of or in any way relating to any one or more
of the following: (a) ownership of this Security Instrument, the Property or
any interest therein or receipt of any Rents; (b) any amendment to, or
restructuring of, the Debt, and the Note, the Loan Agreement, this Security
Instrument, or any other Loan Documents; (c) any and all lawful action that may
be taken by Lender in connection with the enforcement of the provisions of this
Security Instrument or the Loan Agreement or the Note or any of the other Loan
Documents, whether or not suit is filed in connection with same, or in
connection with Borrower, any guarantor or indemnitor and/or any partner, joint
venturer or shareholder thereof becoming a party to a voluntary or involuntary federal
or state bankruptcy, insolvency or similar proceeding; (d) any accident, injury
to or death of persons or loss of or damage to property occurring in, on or
about the Property or any part thereof or on the adjoining sidewalks, curbs,
adjacent property or adjacent parking areas, streets or ways; (e) performance
of any labor or services or the furnishing of any materials or other property
in respect of the Property or any part thereof; (f) the failure of any person
to file timely with the Internal Revenue Service an accurate Form 1099-B,
Statement for Recipients of Proceeds from Real Estate, Broker and Barter
Exchange Transactions, which may be required in connection with this Security
Instrument, or to supply a copy thereof in a timely fashion to the recipient of
the proceeds of the transaction in connection with which this Security
Instrument is made; (g) any failure of the Property to be in compliance with
any Legal Requirements; (h) the enforcement by any Indemnified Party of the
provisions of this Article 9; (i) any and all claims and demands whatsoever
which may be asserted against Lender by reason of any alleged obligations or
undertakings on its part to perform or discharge any of the terms, covenants,
or agreements contained in any Lease; (j) the payment of any commission, charge
or brokerage fee to anyone claiming through Borrower which may be payable in
connection with



 24
 






 



the
funding of the Loan; or (k) any misrepresentation made by Borrower in this
Security Instrument or any other Loan Document. Notwithstanding the foregoing,
Borrower shall not be liable to the Indemnified Parties under this Section 9.1
for any Losses to which the Indemnified Parties may become subject to the
extent such Losses arise by reason of the gross negligence, illegal acts, fraud
or willful misconduct of the Indemnified Parties or Losses resulting from acts
or omissions arising after a completed foreclosure of the Property or
acceptance by Lender of a deed in lieu of foreclosure. Any amounts payable to
Lender by reason of the application of this Section 9.1 shall become
immediately due and payable and shall bear interest at the Default Rate from
the date loss or damage is sustained by Lender until paid. For purposes of this
Article 9, the term “Indemnified Parties”
means Lender and any Person who is or will have been involved in the
origination of the Loan, any Person who is or will have been involved in the
servicing of the Loan secured hereby, any Person in whose name the encumbrance
created by this Security Instrument is or will have been recorded, persons and
entities who may hold or acquire or will have held a full or partial interest
in the Loan secured hereby (including, but not limited to, investors or
prospective investors in the Securities, as well as custodians, trustees and
other fiduciaries who hold or have held a full or partial interest in the Loan
secured hereby for the benefit of third parties) as well as the respective
directors, officers, shareholders, partners, employees, agents, servants,
representatives, contractors, subcontractors, affiliates, subsidiaries,
participants, successors and assigns of any and all of the foregoing (including
but not limited to any other Person who holds or acquires or will have held a
participation or other full or partial interest in the Loan, whether during the
term of the Loan or as a part of or following a foreclosure of the Loan and
including, but not limited to, any successors by merger, consolidation or
acquisition of all or a substantial portion of Lender’s assets and business).


9.2           Mortgage
and/or Intangible Tax. Borrower shall, at its sole cost and expense,
protect, defend, indemnify, release and hold harmless the Indemnified Parties
from and against any and all Losses imposed upon or incurred by or asserted
against any Indemnified Parties and directly or indirectly arising out of or in
any way relating to any tax on the making and/or recording of this Security
Instrument, the Note or any of the other Loan Documents, but excluding any
income, franchise or other similar taxes. Borrower hereby agrees that, in the
event that it is determined that any documentary stamp taxes or intangible
personal property taxes are due hereon or on any mortgage or promissory note
executed in connection herewith (including, without limitation, the Note),
Borrower shall indemnify and hold harmless the Indemnified Parties for all such
documentary stamp and/or intangible taxes, including all penalties and interest
assessed or charged in connection therewith.


9.3           ERISA
Indemnification. Borrower shall, at its sole cost and expense, protect,
defend, indemnify, release and hold harmless the Indemnified Parties from and
against any and all Losses (including, without limitation, reasonable attorneys’
fees and costs incurred in the investigation, defense, and settlement of Losses
incurred in correcting any prohibited transaction or in the sale of a
prohibited loan, and in obtaining any individual prohibited transaction
exemption under ERISA that may be required, in Lender’s sole discretion) that
Lender may incur, directly or indirectly, as a result of a default under
Sections 4.1.9 or 5.2.12 of the Loan Agreement.



 25
 






 



9.4           Environmental
Indemnification. Borrower shall, at its sole cost and expense, protect,
defend, indemnify, release and hold harmless the Indemnified Parties from and
against any and all Losses and costs of Remediation (whether or not performed
voluntarily), engineers’ fees, environmental consultants’ fees, and costs of
investigation (including but not limited to sampling, testing, and analysis of
soil, water, air, building materials and other materials and substances whether
solid, liquid or gas) imposed upon or incurred by or asserted against any
Indemnified Parties, and directly or indirectly arising out of or in any way
relating to any one or more of the following: (a) any presence of any Hazardous
Substances in, on, above, or under the Property; (b) any past, present or
threatened Release of Hazardous Substances in, on, above, under or from the
Property; (c) any activity by Borrower, any Person affiliated with Borrower or
any tenant or other user of the Property in connection with any actual,
proposed or threatened use, treatment, storage, holding, existence, disposition
or other Release, generation, production, manufacturing, processing, refining,
control, management, abatement, removal, handling, transfer or transportation
to or from the Property of any Hazardous Substances at any time located in,
under, on or above the Property; (d) any activity by Borrower, any Person
affiliated with Borrower or any tenant or other user of the Property in
connection with any actual or proposed Remediation of any Hazardous Substances
at any time located in, under, on or above the Property, whether or not such
Remediation is voluntary or pursuant to court or administrative order,
including but not limited to any removal, remedial or corrective action; (e)
any past or present non-compliance or violations of any Environmental Laws (or
permits issued pursuant to any Environmental Law) in connection with the Property
or operations thereon, including but not limited to any failure by Borrower,
any Affiliate of Borrower or any tenant or other user of the Property to comply
with any order of any Governmental Authority in connection with any
Environmental Laws; (f) the imposition, recording or filing of any
Environmental Lien encumbering the Property; (g) any administrative processes
or proceedings or judicial proceedings in any way connected with any matter
addressed in Article 8 and this Section 9.4; (h) any past, present or
threatened injury to, destruction of or loss of natural resources in any way
connected with the Property, including but not limited to costs to investigate
and assess such injury, destruction or loss; (i) any acts of Borrower or other
users of the Property in arranging for disposal or treatment, or arranging with
a transporter for transport for disposal or treatment, of Hazardous Substances
owned or possessed by such Borrower or other users, at any facility or
incineration vessel owned or operated by another Person and containing such or
any similar Hazardous Substance; (j) any acts of Borrower or other users of the
Property, in accepting any Hazardous Substances for transport to disposal or
treatment facilities, incineration vessels or sites selected by Borrower or
such other users, from which there is a Release, or a threatened Release of any
Hazardous Substance which causes the incurrence of costs for Remediation; (k)
any personal injury, wrongful death, or property damage arising under any
statutory or common law or tort law theory, including but not limited to
damages assessed for the maintenance of a private or public nuisance or for the
conducting of an abnormally dangerous activity on or near the Property; and (1)
any misrepresentation or inaccuracy in any representation or warranty or
material breach or failure to perform any covenants or other obligations
pursuant to Article 8. Notwithstanding the foregoing, Borrower shall not be
liable under this Section 9.4 for any Losses or costs of Remediation to which
the Indemnified Parties may become subject to the extent such



 26
 






 



Losses
or costs of Remediation arise by reason of the gross negligence, illegal acts,
fraud or willful misconduct of the Indemnified Parties or Losses resulting from
acts or omissions arising after a completed foreclosure of the Property or
acceptance by Lender of a deed in lieu of foreclosure. This indemnity shall
survive any termination, satisfaction or foreclosure of this Security
Instrument, subject to the provisions of Section 10.5.


9.5           Duty
to Defend; Attorneys’ Fees and Other Fees and Expenses. Upon written
request by any Indemnified Party, Borrower shall defend such Indemnified Party
(if requested by any Indemnified Party, in the name of the Indemnified Party)
by attorneys and other professionals approved by the Indemnified Parties.
Notwithstanding the foregoing, if the defendants in any such claim or
proceeding include both Borrower and any Indemnified Party and Borrower and
such Indemnified Party shall have reasonably concluded that there are any legal
defenses available to it and/or other Indemnified Parties that are different
from or additional to those available to Borrower, such Indemnified Party shall
have the right to select separate counsel to assert such legal defenses and to
otherwise participate in the defense of such action on behalf of such
Indemnified Party, provided that no compromise or settlement shall be entered
without Borrower’s consent, which consent shall not be unreasonably withheld.
Upon demand, Borrower shall pay or, in the sole and absolute discretion of the
Indemnified Parties, reimburse, the Indemnified Parties for the payment of
reasonable fees and disbursements of attorneys, engineers, environmental
consultants, laboratories and other professionals in connection therewith.


ARTICLE X


WAIVERS


10.1         Waiver
of Counterclaim. To the extent permitted by applicable law, Borrower hereby
waives the right to assert a counterclaim, other than a mandatory or compulsory
counterclaim, in any action or proceeding brought against it by Lender arising
out of or in any way connected with this Security Instrument, the Loan
Agreement, the Note, any of the other Loan Documents, or the Obligations.


10.2         Marshalling
and Other Matters. To the extent permitted by applicable law, Borrower
hereby waives, to the extent permitted by law, the benefit of all appraisement,
valuation, stay, extension, reinstatement and redemption laws now or hereafter
in force and all rights of marshalling in the event of any sale hereunder of
the Property or any part thereof or any interest therein. Further, Borrower
hereby expressly waives any and all rights of redemption from sale under any
order or decree of foreclosure of this Security Instrument on behalf of
Borrower, and on behalf of each and every person acquiring any interest in or
title to the Property subsequent to the date of this Security Instrument and on
behalf of all persons to the extent permitted by applicable law.


10.3         Waiver
of Notice. To the extent permitted by applicable law, Borrower shall not be
entitled to any notices of any nature whatsoever from Lender or Trustee except
with



 27
 






 



respect
to matters for which this Security Instrument specifically and expressly
provides for the giving of notice by Lender or Trustee to Borrower and except
with respect to matters for which Lender or Trustee is required by applicable
law to give notice, and Borrower hereby expressly waives the right to receive
any notice from Lender or Trustee with respect to any matter for which this
Security Instrument does not specifically and expressly provide for the giving
of notice by Lender or Trustee to Borrower.


10.4         Waiver
of Statute of Limitations. To the extent permitted by applicable law,
Borrower hereby expressly waives and releases to the fullest extent permitted
by law, the pleading of any statute of limitations as a defense to payment of
the Debt or performance of its Other Obligations.


10.5         Survival.
The indemnifications made pursuant to Sections 9.3 and 9.4 herein and the
representations and warranties, covenants, and other obligations arising under
Article 8, shall continue indefinitely in full force and effect and shall
survive and shall in no way be impaired by: any satisfaction or other
termination of this Security Instrument, any assignment or other transfer of
all or any portion of this Security Instrument or Lender’s interest in the
Property (but, in such case, shall benefit both Indemnified Parties and any
assignee or transferee), any exercise of Lender’s rights and remedies pursuant
hereto including but not limited to foreclosure or acceptance of a deed in lieu
of foreclosure, any exercise of any rights and remedies pursuant to the Loan
Agreement, the Note or any of the other Loan Documents, any transfer of all or
any portion of the Property (whether by Borrower or by Lender following
foreclosure or acceptance of a deed in lieu of foreclosure or at any other
time), any amendment to this Security Instrument, the Loan Agreement, the Note
or the other Loan Documents, and any act or omission that might otherwise be
construed as a release or discharge of Borrower from the obligations pursuant
hereto. Notwithstanding anything to the contrary contained in this Security
Instrument or the other Loan Documents, Borrower shall not have any obligations
or liabilities under the indemnification under Section 9.4 herein or other
indemnifications with respect to Hazardous Substances contained in the other
Loan Documents with respect to those obligations and liabilities that Borrower
can prove arose solely from Hazardous Substances that (i) were not present on
or a threat to the Property prior to the date that Lender or its nominee
acquired title to the Property, whether by foreclosure, exercise by power of
sale, acceptance of a deed-in-lieu of foreclosure or otherwise and (ii) were
not the result of any act or negligence of Borrower or any of Borrower’s
affiliates, agents or contractors.


ARTICLE XI


EXCULPATION


The provisions of Section 9.4 of the Loan Agreement
are hereby incorporated by reference into this Security Instrument to the same
extent and with the same force as if fully set forth herein.



 28
 






 



ARTICLE XII


NOTICES


All notices or other written communications hereunder
shall be delivered in accordance with Section 10.6 of the Loan Agreement.


Notices to MERS hereunder and under any of the other
Loan Documents shall include a copy thereof to Lender (to be addressed and
delivered in accordance with this Section 10.6 of the Loan Agreement) and shall
be sent as follows:


MERS
Commercial


P.O.
Box 2300


Flint, Michigan 48501-2300


ARTICLE XIII


APPLICABLE LAW


13.1         GOVERNING LAW. THIS SECURITY INSTRUMENT SHALL BE DEEMED TO BE A CONTRACT ENTERED INTO
PURSUANT TO THE LAWS OF THE STATE WHERE THE PROPERTY IS LOCATED AND SHALL IN
ALL RESPECTS BE GOVERNED, CONSTRUED, APPLIED AND ENFORCED IN ACCORDANCE WITH
THE LAWS OF THE STATE WHERE THE PROPERTY IS LOCATED.


13.2         Usury
Laws. Notwithstanding anything to the contrary, (a) all agreements and
communications between Borrower and Lender are hereby and shall automatically
be limited so that, after taking into account all amounts deemed interest, the
interest contracted for, charged or received by Lender shall never exceed the
maximum lawful rate or amount, (b) in calculating whether any interest exceeds
the lawful maximum, all such interest shall be amortized, prorated, allocated
and spread over the full amount and term of all principal indebtedness of
Borrower to Lender, and (c) if through any contingency or event, Lender
receives or is deemed to receive interest in excess of the lawful maximum, any
such excess shall be deemed to have been applied toward payment of the
principal of any and all then outstanding indebtedness of Borrower to Lender,
or if there is no such indebtedness, shall immediately be returned to Borrower.


13.3         Provisions
Subject to Applicable Law. All rights, powers and remedies provided in this
Security Instrument may be exercised only to the extent that the exercise
thereof does not violate any applicable provisions of law and are intended to
be limited to the extent necessary so that they will not render this Security
Instrument invalid, unenforceable or not entitled to be recorded, registered or
filed under the provisions of any applicable law. If any term of this Security
Instrument or any application thereof shall be invalid or unenforceable, the



 29
 






 



remainder
of this Security Instrument and any other application of the term shall not be
affected thereby.


ARTICLE XIV


DEFINITIONS


All capitalized terms not defined herein shall the
respective meanings set forth in the Loan Agreement. Unless the context clearly
indicates a contrary intent or unless otherwise specifically provided herein,
words used in this Security Instrument may be used interchangeably in singular
or plural form and the word “Borrower”
shall mean “each Borrower and any subsequent owner or owners of the
Property or any part thereof or any interest therein,” the word “Lender” shall mean “Lender and any
subsequent holder of the Note,” the word “Note”
shall mean “the Note and any other evidence of indebtedness secured
by this Security Instrument,” the word “Property”
shall include any portion of the Property and any interest therein,
and the phrases “attorneys’ fees”, “legal
fees” and “counsel fees”
shall include any and all attorneys’, paralegal and law clerk fees
and disbursements, including, but not limited to, fees and disbursements at the
pre-trial, trial and appellate levels incurred or paid by Lender in protecting
its interest in the Property, the Leases and the Rents and enforcing its rights
hereunder.


ARTICLE XV


MISCELLANEOUS PROVISIONS


15.1         No
Oral Change. This Security Instrument, and any provisions hereof, may not
be modified, amended, waived, extended, changed, discharged or terminated
orally or by any act or failure to act on the part of Borrower or Lender, but
only by an agreement in writing signed by the party against whom enforcement of
any modification, amendment, waiver, extension, change, discharge or
termination is sought.


15.2         Successors
and Assigns. This Security Instrument shall be binding upon and inure to
the benefit of Borrower and Lender and their respective successors and assigns
forever.


15.3         Inapplicable
Provisions. If any term, covenant or condition of the Loan Agreement, the
Note or this Security Instrument is held to be invalid, illegal or unenforceable
in any respect, the Loan Agreement, the Note and this Security Instrument shall
be construed without such provision.


15.4         Headings,
Etc. The headings and captions of various Sections of this Security
Instrument are for convenience of reference only and are not to be construed as
defining or limiting, in any way, the scope or intent of the provisions hereof.



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15.5         Number
and Gender. Whenever the context may require, any pronouns used herein
shall include the corresponding masculine, feminine or neuter forms, and the
singular form of nouns and pronouns shall include the plural and vice versa.


15.6         Subrogation.
If any or all of the proceeds of the Note have been used to extinguish, extend
or renew any indebtedness heretofore existing against the Property, then, to
the extent of the funds so used, Lender shall be subrogated to all of the
rights, claims, liens, titles, and interests existing against the Property
heretofore held by, or in favor of, the holder of such indebtedness and such
former rights, claims, liens, titles, and interests, if any, are not waived but
rather are continued in full force and effect in favor of Lender and are merged
with the lien and security interest created herein as cumulative security for
the repayment of the Debt, the performance and discharge of Borrower’s
obligations hereunder, under the Loan Agreement, the Note and the other Loan
Documents and the performance and discharge of the Other Obligations.


15.7         Entire
Agreement. The Note, the Loan Agreement, this Security Instrument and the
other Loan Documents constitute the entire understanding and agreement between
Borrower and Lender with respect to the transactions arising in connection with
the Debt and supersede all prior written or oral understandings and agreements
between Borrower and Lender with respect thereto. Borrower hereby acknowledges
that, except as incorporated in writing in the Note, the Loan Agreement, this
Security Instrument and the other Loan Documents, there are not, and were not,
and no persons are or were authorized by Lender to make, any representations,
understandings, stipulations, agreements or promises, oral or written, with
respect to the transaction which is the subject of the Note, the Loan
Agreement, this Security Instrument and the other Loan Documents.


15.8         Limitation
on Lender’s Responsibility. No provision of this Security Instrument shall
operate to place any obligation or liability for the control, care, management
or repair of the Property upon Lender, nor shall it operate to make Lender responsible
or liable for any waste committed on the Property by the tenants or any other
Person, or 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 or
stranger. Nothing herein contained shall be construed as constituting Lender a “mortgagee
in possession.”


15.9         Substitution
of Trustee. Lender shall have, and is hereby granted by Borrower, the irrevocable
power to appoint one or more individuals as a substitute Trustee hereunder, to
be exercised at any time hereafter without notice and without specifying any
reason therefor, by filing for record in the office where this Mortgage is
recorded a deed of appointment or similar instrument, and said power of
appointment of one or more individuals as successor Trustee may be exercised as
often and whenever Lender deems it advisable. The exercise of said power of
appointment, no matter how often, shall not be an exhaustion thereof. Upon the
recordation of such deed of appointment or similar instrument, the individual
Trustee so appointed shall thereupon, without any further act, become fully
vested with identically the same



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title
and estate in and to the Property and with all the rights, powers, trusts and
duties of their, his, hers or its predecessor in the trust hereunder with like
effect as if originally named as Trustee. Whenever in this Security Instrument
reference is made to Trustee, it shall be construed to mean each individual
appointed as Trustee for the time being, whether original or successors or
successor in trust. All title, estate, rights, powers, trusts and duties
hereunder given or appertaining to or devolving upon Trustee shall be in each of
the individuals appointed as Trustee so that any action hereunder or purporting
to be hereunder of any one of the individuals appointed as Trustee shall for
all purposes be considered to be, and as effective as, the action of Trustee.


15.10       Reconveyance. Upon written request of the
Lender and surrender of this Security Instrument and the Note to Trustee for
cancellation or endorsement, and upon payment of its fees and charges, Trustee
shall reconvey, without warranty, all or any part of the property then subject
to this Security Instrument. Any reconveyance, whether full or partial, may be
made in terms to “the person or persons legally entitled thereto,” and the
recitals in such reconveyance of any matters or facts shall be conclusive proof
of the truthfulness thereof.


ARTICLE XVI


STATE SPECIFIC PROVISIONS


Principles of Construction. In the event of any
inconsistencies between the terms and conditions of this Article 16 and the
terms and conditions of this Security Instrument, the terms and conditions of this
Article 16 shall control and be binding.


16.1         Missouri
Provisions.


(a)           The
right of Lender to collect and receive the Rents from the Property or to take possession
of the Property or to exercise any of the rights or powers herein granted to
Lender shall, to the extent not prohibited by law, also extend to the period
from and after the filing of any suit or the taking of other actions to
foreclose the lien of this Security Instrument, including any period allowed by
law for the redemption of the Property after any foreclosure sale.


(b)           Upon
the occurrence of an Event of Default, Lender shall, at its option and without notice
or demand, be entitled to enter upon the Property to take immediate possession
of the personalty and the fixtures. Lender may sell all or any portion of the
personalty and the fixtures at public or private sale in accordance with the
Uniform Commercial Code as adopted in Missouri or in accordance with the
foreclosure advertisement and sale provisions under this Security Instrument.
Borrower agrees that a commercially reasonable manner of disposition of the
personalty and the fixtures upon a default shall include, without limitation
and at the option of Lender, the sale of personalty and the fixtures, in whole
or in part, concurrently with a foreclosure sale of the Property in accordance
with the provisions of this Security Instrument. In the further event Lender
shall dispose of any or all of the personalty and the fixtures after default, the
proceeds of disposition shall be applied in the following order:    (i) to the expenses of



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retaking,
holding, preparing for sale, selling and the like; (ii) to the reasonable
attorneys’ fees and legal expenses incurred by Lender; and (iii) to the
satisfaction of the indebtedness secured hereby. Borrower hereby waives any
right of redeeming the personalty and the fixtures whether foreclosure with
regard thereto is coterminous with or separate from foreclosure of the
Property.


(c)           If
an Event of Default shall occur and be continuing, Trustee is authorized and
empowered to proceed to sell the Property as one parcel in its entirety or any
part thereof, either in mass or in parcels, at the absolute discretion of
Trustee, at public vendue, to the highest bidder for cash at the door of the
courthouse or other location then customarily employed for that purpose in the
county (or city) where the Property is located, first giving notice of the time
and place of sale, and a description of the property to be sold, by
advertisement published and as is provided by the laws of the State of Missouri
then in effect, and upon sale shall execute and deliver a deed of conveyance of
the property sold to the purchaser or purchasers thereof, and any statement or
recital of fact in such deed, in relation to the non-payment of the money
hereby secured to be paid, existence of the indebtedness so secured, notice of
advertisement, sale and receipt of the proceeds of sale, shall be prima facie
evidence of the truth of such statements or recital, and Trustee shall receive
the proceeds of such sale out of which Trustee shall dispose of the proceeds:
FIRST, to discharge the expenses of executing this Security Instrument,
including a reasonable commission to Trustee, and all proper costs, charges and
expenses of the sale and reasonable attorney’s fees in connection with the
sale; SECOND, to discharge all taxes, levies and assessments with costs and
interest thereon from the date of advance to the date of sale at an interest
rate equal to the Default Rate, including all monies previously advanced for
taxes, levies and assessments and the due pro rata portion thereof for the
current year; THIRD, to discharge in the order of their priority, if any, the
remaining debts and obligations secured by this Security Instrument, and liens
of record inferior thereon, it being agreed that the Loan shall, upon such sale
being made before the maturity date of the Loan, be and become immediately due
and payable; less the expense, if any, of obtaining possession upon the
delivery and surrender to the purchaser of possession of the Property; and
FOURTH, the residue of the proceeds shall be paid to Borrower and its assigns,
provided, however, that as to such residue Trustee shall not be bound by any
inheritance, devise, conveyance, assignment or lien upon Borrower’s equity,
without actual notice prior to distribution. Lender may bid and become
purchaser at any sale under this Security Instrument. The power of sale
hereunder shall not be exhausted by any one or more such sales (or attempts to
sell) as to all or any portion of the Property remaining unsold, but shall
continue unimpaired until all of the Property has been sold or all indebtedness
of Borrower to Lender secured hereby shall have been paid in full.


(d)           Trustee
may sell and convey the Property under the power aforesaid, although Trustee
has been, may now be or may hereafter be attorney or agent of Lender in respect
to the loan made by Lender evidenced by the Loan Documents or this Security
Instrument or in respect to any matter of business whatsoever.


(e)           Trustee
hereby lets the Property to Borrower until a sale be had under the foregoing
provisions, upon the following terms and conditions, such letting being to-wit:
Borrower and every and all persons claiming or possessing the Property, or any
part thereof, by, through or under Borrower shall pay rent therefor during said
term at the rate of one cent per



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month,
payable monthly upon demand, and shall surrender immediate peaceable possession
of the Property, to the purchaser thereof, under such sale, without notice or
demand therefor. Should possession not be surrendered as provided for herein
the purchaser shall be entitled to institute proceedings for possession as
aforesaid.


(f)            In
the event any foreclosure advertisement is running or has run at the time of
such appointment of a successor trustee, the successor trustee may consummate
the advertised sale without the necessity of republishing such advertisement.
The making of oath or giving of bond by Trustee or any successor trustee is
expressly waived.


(g)           Statutory
Notice – Insurance. The following notice is given pursuant to Section 427.120
of the Missouri Revised Statutes; nothing contained herein shall be deemed to
limit or modify the terms of this Security Instrument.


UNLESS YOU PROVIDE EVIDENCE OF THE INSURANCE COVERAGE
REQUIRED BY THIS SECURITY INSTRUMENT, WE MAY PURCHASE INSURANCE AT YOUR EXPENSE
TO PROTECT OUR INTERESTS IN YOUR COLLATERAL. THIS INSURANCE MAY, BUT NEED NOT,
PROTECT YOUR INTERESTS. THE COVERAGE THAT WE PURCHASE MAY NOT PAY ANY CLAIM
THAT YOU MAKE OR ANY CLAIM THAT IS MADE AGAINST YOU IN CONNECTION WITH THE
COLLATERAL. YOU MAY LATER CANCEL ANY INSURANCE PURCHASED BY US, BUT ONLY AFTER
PROVIDING EVIDENCE THAT YOU HAVE OBTAINED INSURANCE AS REQUIRED BY THIS
SECURITY INSTRUMENT. IF WE PURCHASE INSURANCE FOR THE COLLATERAL, YOU WILL BE
RESPONSIBLE FOR THE COSTS OF THAT INSURANCE, INCLUDING THE INSURANCE PREMIUM,
INTEREST AND OTHER CHARGES WE MAY IMPOSE IN CONNECTION WITH THE PLACEMENT OF
THE INSURANCE, UNTIL THE EFFECTIVE DATE OF THE CANCELLATION OR EXPIRATION OF
THE INSURANCE. THE COSTS OF THE INSURANCE MAY BE ADDED TO YOUR TOTAL
OUTSTANDING BALANCE OR OBLIGATION. THE COSTS OF THE INSURANCE MAY BE MORE THAN
THE COST OF INSURANCE THAT YOU MAY BE ABLE TO OBTAIN ON YOUR OWN.


[NO FURTHER TEXT ON THIS PAGE]



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IN WITNESS WHEREOF, THIS SECURITY INSTRUMENT has been
executed by Borrower the day and year first above written.


	
  

  	
   

  	
   

  	
  BORROWER:

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  MB ST. LOUIS CHESTNUT, L.L.C.,
  a Delaware

  limited liability company

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  Minto Builders (Florida), Inc., a Florida

  corporation, its sole member

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Valerie Medina

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  Name:

  	
  Valerie Medina

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  Title:

  	
  Assistant Secretary

  
									



 



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ACKNOWLEDGMENT


STATE
OF  Illinois


COUNTY
OF  DuPage


The foregoing instrument was acknowledged before me
this 18 day of December 2006 by Valerie Medina as Asst. Secretary of MINTO
BUILDERS (FLORIDA), INC., a Florida corporation, which is the sole member of MB
ST. LOUIS CHESTNUT, L.L.C., a Delaware limited liability company, who executed
the foregoing instrument, and acknowledged the execution thereof to be her free
act and deed as such officer on behalf of said corporation in its capacity as
general partner of said limited partnership, in its capacity as sole member and
manager of said limited liability company for the use and purposes therein
mentioned, and the said instrument is the act and deed of said corporation,
limited partnership and limited liability company. She is personally known to
me or who has produced                                     as
identification.


My commission expires:


	
  

  	
   

  	
  ROSE MARIE ALLRED

  	
   

  
	
  [Notarial Seal]

  	
   

  	
  Print Name:

  
	
   

  	
   

  	
  Notary Public

  
	
   

  	
   

  	
  Serial Number:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  OFFICIAL SEAL

  
	
   

  	
  ROSE MARIE
  ALLRED

  
	
   

  	
  NOTARY PUBLIC -
  STATE OF ILLINOIS

  
	
   

  	
  MY COMMISSION
  EXPlRES:05/21/09

  
						



 



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EXHIBIT A


LEGAL DESCRIPTION


(the legal description follows on next page)