Unassociated Document


    
      
        

          Exhibit
            10.89

          PROMISSORY
            NOTE

          (AL
            Expansion)

           

          
            	
                    $11,424,000.00

                  	
                    Dallas,
                      Texas

                  	
                    December
                      ____, 2005

                  


          

           

          FOR
            VALUE
            RECEIVED, the undersigned, ARC BRANDYWINE, L.P., a Delaware limited partnership
            (“Borrower”),
            hereby
            promises to pay to the order of GUARANTY BANK, a federal savings bank
            (“Lender”
which
            shall also include each successor or assign who becomes the holder of
            this
            Note), the principal sum of Eleven Million Four Hundred Twenty Four Thousand
            and
            No/100 Dollars ($11,424,000.00), with interest on the unpaid balance
            thereof
            from date of advancement until maturity at the rate or rates hereinafter
            provided, both principal and interest payable as hereinafter provided
            in lawful
            money of the United States of America at the offices of Guaranty Bank,
            8333
            Douglas Avenue, Dallas, Texas 75225, or at such other place within Dallas
            County, Texas as from time to time may be designated by Lender.

           

          1.  Defined
            Terms

           

          :
            As used
            in this Note, the following terms shall have the meanings indicated opposite
            them:

           

          “Additional
            Costs”
-
            Any
            costs, losses or expenses incurred by Lender which it determines are
            attributable to its making or maintaining the Loan, or its obligation
            to make
            any Loan advances, or any reduction in any amount receivable by Lender
            under the
            Loan or this Note.

           

          “Applicable
            Rate”
-
            The
            Fixed Rate or the Commercial Based Rate, as the case may be.

           

          “Bloomberg”
-
            The
            Bloomberg Professional Service (a date service), or if such service is
            not
            available, such other comparable publicly available service as may be
            selected
            from time to time by Lender and determined to be comparable to the
            Bloomberg.

           

          “Business
            Day”
-
            A day,
            other than a Saturday or Sunday, on which commercial banks are open for
            business
            with the public in Dallas, Texas.

           

          “Commercial
            Based Rate”
-
            The
            base rate announced or published from time to time by Lender, which rate
            may not
            be the lowest rate charged by Lender, plus 1.0%; it being understood
            and agreed
            that the Commercial Based Rate shall increase or decrease, as the case
            may be,
            from time to time as of the effective date of each change in the base
            rate.

           

          “Debt
            Coverage Ratio”
-
            A
            ratio, as reasonably determined by Lender, the first number of which
            is the Net
            Operating Income for the period in question and the second of which is
            Debt
            Service for such period.

           

          “Debt
            Service”
-
            The
            product of (i) the constant monthly payment amount (i.e., payment including
            both
            principal and interest) sufficient to fully amortize (using mortgage
            amortization) the Loan at the time of determination in equal installments
            over a
            25 year period using an interest rate equal to the greater of (a) the
            Commercial
            Based Rate, (b) the Fixed Rate, (c) the Treasury Note Rate plus 2.25%,
            or (d)
            7.5%, multiplied by (ii) the number of months in the period in
            question.

           

          
            
              1

            

            
              
              

              
                

              

            

            
              
              

            

          

          “Default
            Rate”
-
            The
            rate per annum which is 5% above the Commercial Based Rate, but in no
            event
            greater than the Maximum Rate.

           

          “Event
            of Default”
-
            As
            defined in the Security Instrument.

           

          “Extension
            Fee”
-
            $28,560. 

           

          “Extension
            Period”
-
            The
            First Extension Period or the Second Extension Period, as the case may
            be.


           

          “First
            Extension Period”
-
            A
            period of 12 months, commencing on the first day after the Maturity
            Date.

           

          “Fixed
            Rate”
-The
            rate per annum (expressed as a percentage) determined by Lender to be
            equal to
            the sum of (a) the quotient of the LIBOR Rate for the Fixed Rate Amount
            and
            Interest Period in question divided by (1 minus the Reserve Requirement),
            rounded up to the nearest 1/100 of 1%, and (b) the Spread. 

           

          “Fixed
            Rate Amount”
-
            Each
            portion of the Principal Amount bearing interest at an applicable Fixed
            Rate
            pursuant to a Fixed Rate Request. Notwithstanding any provision contained
            herein
            to the contrary, no Fixed Rate Request may request less than the entire
            Principal Amount bear interest at the same Fixed Rate.

           

          “Fixed
            Rate Business Day”
—
A
            day,
            other than a Saturday or Sunday, on which commercial banks are open for
            domestic
            and international business (including dealings in U.S. Dollar deposits)
            in New
            York, New York and Dallas, Texas.

           

          “Fixed
            Rate Request”
—
            Borrower’s telephonic notice (to be promptly confirmed in writing which must be
            received by Lender before such Fixed Rate Request will be put into effect
            by
            Lender), to be received by Lender by 12 o’clock Noon (Central Standard
            Time) 3 Fixed Rate Business Days prior to the Fixed Rate Business Day
            specified
            in the Fixed Rate Request for the commencement of the Interest Period,
            of the
            Fixed Rate and Interest Period desired by Borrower in respect to a Fixed
            Rate
            Request Amount.

           

          “Fixed
            Rate Request Amount”
—
The
            amount, to be specified by Borrower in each Fixed Rate Request, which
            Borrower
            desires to bear interest at the Fixed Rate and which shall in no event
            be less
            than $500,000 and which, at Lender’s option, shall be an integral multiple of
            $100,000.

           

          
            
              2

            

            
              
              

              
                

              

            

            
              
              

            

          

          “Funding
            Date”
-
            The
            date of funding of the Loan.

           

          “Interest
            Period”
-
            A
            period computed as follows: 

           

          (a) The
            period
            during which interest at the Fixed Rate shall be applicable to the Fixed
            Rate
            Amount in question, provided, however, that each such period shall be
            a one (1)
            month period commencing on the first day of each calendar month.

           

          (b) An
            Interest Period shall be measured from the date specified by Borrower
            in each
            Fixed Rate Request for the commencement of the computation of interest
            at the
            Fixed Rate, to the numerically corresponding day in the calendar month
            in which
            such period terminates (or, if there be no numerical correspondent in
            such
            month, or if the date selected by Borrower for such commencement is the
            last
            Fixed Rate Business Day of a calendar month, then the last Fixed Rate
            Business
            Day of the calendar month in which such period terminates, or if the
            numerically
            corresponding day is not a Fixed Rate Business Day then the next succeeding
            Fixed Rate Business Day, unless such next succeeding Fixed Rate Business
            Day
            enters a new calendar month, in which case such period shall end on the
            next
            preceding Fixed Rate Business Day) and in no event shall any such period
            be
            elected which extends beyond the Maturity Date.

           

          “LIBOR
            Rate”
—
The
            rate determined by Lender (rounded upward, if necessary, to the nearest
            1/100th
            of 1%)
            equal to the offered rate (and not the bid rate) for deposits in U.S.
            Dollars of
            amounts comparable to the Fixed Rate Request Amount for the same period
            of time
            as the Interest Period selected by Borrower in the Fixed Rate Request,
            as set
            forth on the LIBOR Reference Source at approximately 10:00 a.m. (Central
            Standard Time) on the first day of the applicable Interest Period.

           

          “LIBOR
            Reference Source”
—
The
            display for London inter-bank offered rates appearing on the Bloomberg,
            as the
            British Bankers Association London inter-bank offered rates for deposits
            in U.S.
            Dollars. 

           

          “Loan”
-
            The
            $11,424,000 loan to be made to Borrower by Lender evidenced by this
            Note.

           

          “Loan
            Agreement”
-
            The
            Loan Agreement of even date herewith between Borrower and Lender relating
            to the
            Loan.

           

          “Loan
            Documents”
-
            This
            Note, the Security Instrument, the Loan Agreement, the Assignment of
            Leases and
            Rents and all other documents evidencing, securing, or relating to the
            Loan.

           

          
            
              3

            

            
              
              

              
                

              

            

            
              
              

            

          

           

          “Make-Whole
            Breakage Amount”
-
            As
            defined in Section 5.

           

          “Make-Whole
            Calculation Rate”
-
            As
            defined in Section 5.

           

          “Maturity
            Date”
-
            December ____, 2008, being the date this Note becomes due and payable
            in its
            entirety, unless extended as provided herein.

           

          “Maximum
            Rate”
-
            The
            maximum interest rate permitted under applicable law.

           

          “Monthly
            Principal Installment Amount”
-
            $9,670.51 during the First Extension Period and $10,369.59 during the
            Second
            Extension Period.

           

          “Net
            Operating Income”
-
            The
            gross income received by Borrower from the operation of the Property
            for the
            period in question, less expenses incurred and/or paid by Borrower in
            connection
            with the operation and maintenance of the Property that are allocable
            to such
            period, computed on an accrual basis without regard to depreciation or
            debt
            service on the Loan, but otherwise in accordance with generally accepted
            accounting principles consistently applied. Included within the expenses
            shall
            be a management fee equal to the greater of (i) the actual management
            fee or
            (ii) an assumed management fee of 5%, and annual capital expenditures
            equal to
            $300 per unit. Documentation of Net Operating Income shall be certified
            by an
            officer of Borrower with detail satisfactory to Lender and shall be subject
            to
            the approval of Lender.

           

          “Principal
            Amount”
-
            That
            portion of the Loan evidenced hereby as is from time to time
            outstanding.

           

          “Property”
-
            The
            real property, together with all improvements, fixtures and other property
            thereon and interest therein described on Exhibit A of the Security Instrument
            as Tract 3. 

           

          “Regulation”
-
            With
            respect to the charging and collecting of interest at the Fixed Rate,
            any United
            States federal, state or foreign laws, treaties, rules or regulations
            whether
            now in effect or hereafter enacted or promulgated (including Regulation
            D) or
            any interpretations, directives or requests applying to a class of depository
            institutions including Lender under any United States federal, state
            or foreign
            laws or regulations (whether or not having the force of law) by any court
            or
            governmental or monetary authority charged with the interpretation or
            administration thereof.

           

          “Regulation
            D”
-
            Regulation D of the Board of Governors of the Federal Reserve System,
            as from
            time to time amended or supplemented.

           

          “Reserve
            Requirement”
-
            The
            average maximum rate at which reserves (including any marginal, supplemental
            or
            emergency reserves) are required to be maintained under Regulation D
            by member
            banks of the Federal Reserve System in New York City with deposits exceeding
            one
            billion U.S. Dollars against “Eurocurrency
            Liabilities”,
            as such
            quoted term is used in Regulation D. Without limiting the effect of the
            foregoing, the Reserve Requirement shall reflect any reserves required
            to be
            maintained by such member banks by reason of any Regulation against (a)
            any
            category of liabilities which includes deposits by reference to which
            the Fixed
            Rate is to be determined as provided in this Note, or (b) any category
            of
            extensions of credit or other assets which includes loans the interest
            rate on
            which is determined on the basis of rates referred to in the definition
            of
“LIBOR Rate”. 

           

          
            
              4

            

            
              
              

              
                

              

            

            
              
              

            

          

           

          “Second
            Extension Period”
-
            A
            period of 12 months, commencing on the first day after the expiration
            of the
            First Extension Period

           

          “Security
            Instrument”
-
            The
            Open-End Mortgage, Security Agreement and Fixture Filing of even date
            herewith
            more particularly described herein. 

           

          “Spread”
-
            2.75%.

           

          “Treasury
            Note Rate”
-
            The
            latest Treasury Constant Maturity Series yields reported, for the latest
            day for
            which such yields shall have been so reported as of the applicable Fixed
            Rate
            Business Day, in Federal Reserve Statistical Release H.15 (519) (or any
            comparable successor publication) for actively traded U.S. Treasury securities
            having a constant maturity equal to 10 years. Such implied yield shall
            be
            determined, if necessary, by (i) converting U.S. Treasury bill quotations
            to
            bond-equivalent yields in accordance with accepted financial practice,
            and (ii)
            interpolating linearly between reported yields. 

           

          2.  Interest

           

          (a)  Borrower
            shall have the option of paying interest on the Principal Amount at the
            Commercial Based Rate or the Fixed Rate (as elected in the manner specified
            in
            this Note). Notwithstanding the foregoing, if at any time the Applicable
            Rate
            exceeds the Maximum Rate, the rate of interest payable under this Note
            shall be
            limited to the Maximum Rate, but any subsequent reductions in the Applicable
            Rate, as the case may be, shall not reduce the Applicable Rate below
            the Maximum
            Rate until the total amount of interest accrued on this Note equals the
            total
            amount of interest which would have accrued at the Applicable Rate if
            the
            Applicable Rate had at all times been in effect. 

           

          (b)  The
            Principal Amount shall bear interest from the date hereof through the
            first day
            of the first month hereafter at the Commercial Based Rate. Thereafter,
            the
            Principal Amount shall bear interest at the Fixed Rate (subject to Lender’s
            right to convert the rate of interest payable hereunder from the Fixed
            Rate to
            the Commercial Based Rate as provided herein) until such time as Borrower
            notifies Lender that it desires application of the Commercial Based Rate
            upon
            expiration of the then current Interest Period. This subsection constitutes
            a
            Fixed Rate Request. It will not be necessary for Borrower to submit further
            Fixed Rate Requests, except after electing application of the Commercial
            Based
            Rate.

           

          
            
              5

            

            
              
              

              
                

              

            

            
              
              

            

          

          (c)  Borrower
            shall pay to Lender, promptly upon demand, such amounts as are necessary
            to
            compensate Lender for Additional Costs resulting from any Regulation
            which (i)
            subjects Lender to any tax, duty or other charge with respect to the
            Loan or
            this Note, or changes the basis of taxation of any amounts payable to
            Lender
            under the Loan or this Note (other than taxes imposed on the overall
            net income
            of Lender or of its applicable lending office by the jurisdiction in
            which
            Lender’s principal office or such applicable lending office is located), (ii)
            imposes, modifies or deems applicable any reserve, special deposit or
            similar
            requirements relating to any extensions of credit or other assets of,
            or any
            deposits with or other liabilities of, Lender, or (iii) imposes on Lender
            or on
            the interbank LIBOR market any other condition affecting the Loan or
            this Note,
            or any of such extensions of credit or liabilities. Lender will notify
            Borrower
            of any event which would entitle Lender to compensation pursuant to this
            Section
            as promptly as practicable after Lender obtains knowledge thereof and
            determines
            to request such compensation. For purposes of this Section 2 and the
            definition
            of “Additional Costs”, the term “Lender” shall, at Lender’s option, be deemed to
            include Lender’s present and future participants in the Loan.

           

          (d)  Without
            limiting the effect of the immediately preceding subsection, in the event
            that,
            by reason of any Regulation, (i) Lender incurs Additional Costs based
            on or
            measured by the amount of (1) a category of deposits or other liabilities
            of
            Lender which includes deposits by reference to which the Fixed Rate is
            determined as provided in this Note and/or (2) a category of extensions
            of
            credit or other assets of Lender which includes loans the interest on
            which is
            determined on the basis of rates referred to in the definition of “LIBOR Rate”,
            (ii) Lender becomes subject to restrictions on the amount of such a
            category of liabilities or assets which it may hold, or (iii) it shall
            be
            unlawful or impractical for Lender to make or maintain the Loan (or any
            portion
            thereof) at the Fixed Rate, then Lender’s obligation to make or maintain the
            Loan (or portions thereof) at the Fixed Rate (and Borrower’s right to request
            the same) shall be suspended and Lender shall give notice thereof to
            Borrower
            and, upon the giving of such notice, interest payable hereunder at the
            Fixed
            Rate shall be converted to the Commercial Based Rate, unless Lender may
            lawfully
            continue to maintain the Loan (or any portion thereof) then bearing interest
            at
            the Fixed Rate to the end of the current Interest Period(s), at which
            time the
            interest rate shall convert to the Commercial Based Rate. If subsequently
            Lender
            determines that such Regulation has ceased to be in effect, Lender will
            so
            advise Borrower and Borrower may convert the rate of interest payable
            hereunder
            with respect to those portions of the Principal Amount bearing interest
            at the
            Commercial Based Rate to a Fixed Rate by submitting a Fixed Rate Request
            in
            respect thereof and otherwise complying with the provisions of this Note
            with
            respect thereto.

           

          (e)  Determinations
            by Lender of the existence or effect of any Regulation on its costs of
            making or
            maintaining the Loan, or portions thereof, at the Fixed Rate, or on amounts
            receivable by it in respect thereof, and of the additional amounts required
            to
            compensate Lender in respect of Additional Costs, shall be conclusive,
            absent
            manifest error, provided that such determinations are made on a reasonable
            basis.

           

          
            
              6

            

            
              
              

              
                

              

            

            
              
              

            

          

          (f)  Anything
            herein to the contrary notwithstanding, if, at the time of or prior to
            the
            determination of the Fixed Rate in respect of any Fixed Rate Request
            as herein
            provided, Lender determines (which determination shall be conclusive,
            absent
            manifest error, provided that such determination is made on a reasonable
            basis)
            that (i) by reason of circumstances affecting the interbank LIBOR market
            generally, adequate and fair means do not or will not exist for determining
            the
            Fixed Rate applicable to an Interest Period, or (ii) the Fixed Rate,
            as
            determined by Lender, will not accurately reflect the cost to Lender
            of making
            or maintaining the Loan (or any portion thereof) at the Fixed Rate, then
            Lender
            shall give Borrower prompt notice thereof, and the Fixed Rate Amount
            in question
            shall bear interest, or continue to bear interest, as the case may be,
            at the
            Commercial Based Rate. If at any time subsequent to the giving of such
            notice,
            Lender determines that because of a change in circumstances the Fixed
            Rate is
            again available to Borrower hereunder, Lender will so advise Borrower
            and
            Borrower may convert the rate of interest payable hereunder from the
            Commercial
            Based Rate to a Fixed Rate by submitting a Fixed Rate Request to Lender
            and
            otherwise complying with the provisions of this Note with respect
            thereto.

           

          (g)  Borrower
            shall pay to Lender, immediately upon request and notwithstanding contrary
            provisions contained in the Loan Documents, such amounts as shall, in
            the
            conclusive judgment of Lender reasonably exercised, compensate Lender
            for any
            loss, cost or expense incurred by it as a result of (i) the conversion, for
            any reason whatsoever, of the rate of interest payable hereunder from
            the Fixed
            Rate to the Commercial Based Rate with respect to any portion of the
            Principal
            Amount then bearing interest at the Fixed Rate on a date other than the
            last day
            of an applicable Interest Period, (ii) the failure of all or a portion of
            an advance which was to have borne interest at the Fixed Rate pursuant
            to a
            Fixed Rate Request to be made under this Note, or (iii) the failure of
            Borrower to borrow in accordance with a Fixed Rate Request submitted
            by it to
            Lender, which amounts shall include, without limitation, lost
            profits.

           

          (h)  Any
            portion of the Principal Amount to which the Fixed Rate is not or cannot
            pursuant to the terms hereof be applicable shall bear interest at the
            Commercial
            Based Rate.

           

          3.  Default
            Rate

           

          (a)  Notwithstanding
            anything to the contrary contained in this Note, at the option of Lender,
            at any
            time after the occurrence and during the continuance of an Event of Default,
            the
            unpaid principal of this Note from time to time outstanding and all past
            due
            installments of interest shall, to the extent permitted by applicable
            law, bear
            interest at the Default Rate.

           

          (b)  If
            an
            Event of Default shall occur, interest on the Principal Amount shall,
            at the
            option of Lender, immediately and without notice to Borrower, be converted
            to
            the Commercial Based Rate during the continuance of the Event of Default.
            The
            foregoing provision shall not be construed as a waiver by Lender of its
            right to
            pursue any other remedies available to it under the Loan Documents, nor
            shall it
            be construed to limit in any way the application of the Default Rate.
            

           

          
            
              7

            

            
              
              

              
                

              

            

            
              
              

            

          

          4.  Payment
            of Principal and Interest.

           

          (a)  Interest
            on the Principal Amount shall be payable monthly in arrears as it accrues
            on the
            first day of the first month following the Funding Date and on the first
            day of
            each month thereafter until the earlier of the date this Note is repaid
            in full
            or the Maturity Date. Commencing on the first day of the first month
            of the
            First Extension Period and on the first day of each month thereafter
            until the
            earlier of the date this Note is repaid in full or the Maturity Date,
            Borrower
            shall pay the Monthly Principal Installment Amount, which Monthly Principal
            Installment Amount is in addition to accrued interest due on each such
            date. The
            Principal Amount and all unpaid interest accrued thereon shall be due
            and
            payable on the Maturity Date. 

           

          (b)  Until
            such
            time as an Event of Default has occurred and after such time as such
            Event of
            Default has been cured, all payments received under this Note shall be
            applied
            in the following order: (i) to any unpaid costs of collection; (ii) to
            any Make-Whole Breakage Amount due; (iii) to accrued but unpaid interest on
            the Principal Amount; and (iv) the Principal Amount. After the occurrence
            and during the continuance of an Event of Default, all payments shall
            be applied
            in any order determined by Lender in its sole discretion.

           

          (c)  All
            interest accruing under this Note shall be calculated on the basis of
            a 360-day
            year applied to the actual number of days in each month. Borrower shall
            make
            each payment which it owes hereunder not later than twelve o’clock, noon
            (Central Standard Time), on the date such payment becomes due and payable
            (or
            the date any voluntary prepayment is made), in immediately available
            funds. Any
            payment received by Lender after such time will be deemed to have been
            made on
            the next following Business Day.

           

          5.  Prepayment.

           

          (a)  Borrower
            shall have the right to prepay the Loan, in whole or in part (except
            as
            otherwise specifically provided herein) provided:

           

          (i)  written
            notice thereof is given to Lender by prepaid registered or certified
            mail at
            least 30 but not more than 60 days prior to the date to be fixed therein
            for
            prepayment, which notice once given shall be irrevocable; and

           

          (ii)  such
            prepayment is accompanied by the Make-Whole Breakage Amount (if the principal
            being repaid is a Fixed Rate Amount and is repaid prior to the expiration
            of the
            related Interest Period), all accrued interest on the amount prepaid,
            including
            interest which has accrued at the Default Rate, and other sums that may
            be
            payable hereunder to the date so fixed.

           

          
            
              8

            

            
              
              

              
                

              

            

            
              
              

            

          

          In
            the
            event that any Make-Whole Breakage Amount is due, Lender shall deliver
            to
            Borrower a statement setting forth the amount and determination of the
            Make-Whole Breakage Amount, and, provided that Lender shall have in good
            faith
            applied the formula described herein, Borrower shall not have the right
            to
            challenge the calculation or the method of calculation set forth in any
            such
            statement in the absence of manifest error. Borrower agrees that (i)
            Lender
            shall not be obligated to actually reinvest the amount prepaid, and (ii)
            the
            Make-Whole Breakage Amount is directly related to the damages that Lender
            will
            suffer as a result of the prepayment. In addition to the Make-Whole Breakage
            Amount and without waiving any prepayment condition, if, upon any such
            prepayment, the aforesaid prior written notice has not been timely received
            by
            Lender, and the prepayment is accepted by Lender, the Make-Whole Breakage
            Amount
            shall be increased by an amount equal to the lesser of (i) 30 days' unearned
            interest computed at the Commercial Based Rate on the amount prepaid,
            or (ii)
            unearned interest computed on the amount prepaid for the period from,
            and
            including, the date of prepayment through the applicable Interest
            Period.

           

          (b)  No
            principal amount repaid may be readvanced.

           

          (c)  In
            the
            event the Make-Whole Breakage Amount is construed to be interest under
            the laws
            of the State of Texas in any circumstance, the payment thereof shall
            not be
            required to the extent that the amount thereof, together with other interest
            payable under the Loan Documents, exceeds the Maximum Rate, and if such
            payment
            has been made at the time it is determined that such excess exists, Lender
            shall, at its option, either return such excess to Borrower or credit
            such
            excess against the principal balance of the Note then outstanding, in
            which
            event any and all penalties of any kind under applicable law as a result
            such
            excess interest shall be inapplicable.

           

          (d)  The
            Make-Whole Breakage Amount shall be due, to the extent permitted by applicable
            law, under any and all circumstances where all or any portion of the
            Loan is
            paid prior to the expiration of an Interest Period, whether such prepayment
            is
            voluntary or involuntary, even if such prepayment results from Lender's
            exercise
            of its rights upon Borrower's default and acceleration of the Maturity
            Date
            (irrespective of whether foreclosure proceedings have been commenced),
            and shall
            be in addition to any other sums due under the Loan Documents.

           

          (e)  As
            used
            herein, the term “Make-Whole
            Breakage Amount”
shall
            mean an amount calculated as follows:

           

          (i)  If
            the
            Make Whole Calculation Rate is equal to or greater than the Fixed Rate
            then in
            effect with respect to the Fixed Rate Amount and related Interest Period
            in
            question, the Make-Whole Breakage Amount shall be zero with respect to
            such
            Fixed Rate Amount.

           

          (ii)  If
            the
            Make Whole Calculation Rate is less than the Fixed Rate then in effect
            concerning the Fixed Rate Amount and related Interest Period in question,
            the
            Make-Whole Breakage Amount concerning the Fixed Rate Amount to be repaid
            shall
            be calculated based upon the present value of the remaining scheduled
            debt
            service (i.e., scheduled principal and/or interest payments allocable
            to the
            Fixed Rate Amount to be repaid) discounted at the Make Whole Calculation
            Rate
            (assuming monthly compounding) for the Interest Period in question minus
            the
            Fixed Rate Amount being repaid.

           

          
            
              9

            

            
              
              

              
                

              

            

            
              
              

            

          

          (f)  As
            used
            herein, the term “Make
            Whole Calculation Rate”
means
            the latest Treasury Constant Maturity Series yields reported, for the
            latest day
            for which such yields shall have been so reported as of the applicable
            Fixed
            Rate Business Day, in Federal Reserve Statistical Release H.15 (519)
            (or any
            comparable successor publication) for actively traded U.S. Treasury securities
            having a constant maturity which most closely matches the period from
            prepayment
            to the maturity of the applicable Interest Period of the principal being
            repaid.
            Such implied yield shall be determined, if necessary, by (i) converting
            U.S.
            Treasury bill quotations to bond-equivalent yields in accordance with
            accepted
            financial practice, and (ii) interpolating linearly between reported
            yields.

           

          6.  Extension
            of Maturity Date.
            Borrower
            shall have the right and option to extend the Maturity Date (a) to a
            date ending
            upon the expiration of the First Extension Period, and (b) upon expiration
            of
            the First Extension Period, to a date ending upon the expiration of the
            Second
            Extension Period, subject to the conditions that:

           

          (a)  Borrower
            shall have notified Lender in writing of its exercise of each such extension
            at
            least 60 days prior to the Maturity Date;

           

          (b)  on
            the
            date of such written notice and on the date of commencement of the Extension
            Period, there shall exist no event of default and no event shall have
            occurred
            which with the passage of time or the giving of notice or both would
            constitute
            an event of default;

           

          (c)  contemporaneously
            with the commencement of each Extension Period, Lender shall have received
            the
            Extension Fee;

           

          (d)  at
            or
            before the commencement of each Extension Period, Lender shall have received
            evidence satisfactory to Lender that the Property has achieved a Debt
            Coverage
            Ratio of at least 1.50:1 for the 3 calendar month period immediately
            preceding
            the commencement of the Extension Period; 

           

          (e)  the
            Principal Amount must not be greater than 50% of the appraised value
            of the
            Property as determined by Lender, for which determination Lender, at
            its option,
            may obtain an updated FIRREA appraisal at Borrower's expense; and

           

          (f)  upon
            each
            such extension, Borrower and any guarantor shall have executed such documents
            as
            Lender deems reasonably appropriate to evidence such extensions and shall
            have
            delivered to Lender an endorsement to the mortgagee policy of title insurance
            insuring the lien of the Security Instrument pursuant to the applicable
            title
            insurance regulations, stating that the coverage of such policy has not
            been
            reduced or terminated by virtue of such extension.

           

          
            
              10

            

            
              
              

              
                

              

            

            
              
              

            

          

          7.  Security.
            This
            Note is secured, inter alia, by the Security Instrument evidencing a
            lien on
            certain real property more particularly described therein, and evidencing
            a
            security interest in certain personal property described therein, to
            which
            Security Instrument reference is here made for a description of the property
            covered thereby and the nature and extent of the security and the rights
            and
            powers of Lender in respect of such security. In addition, Borrower has
            made an
            Assignment of Leases and Rents (herein so called) covering certain leases
            and
            rents described therein to provide a source of future payment of this
            Note,
            reference to which Assignment of Leases and Rents is here made for a
            description
            of the leases and rents covered thereby and the rights and powers of
            Lender with
            respect thereto. Upon the occurrence of an Event of Default, Lender shall
            have
            the option of declaring the Principal Amount hereof and the interest
            accrued
            hereon to be immediately due and payable.

           

          8.  Usury
            Savings.
            It is
            the intent of Lender and Borrower in the execution of this Note and all
            other
            instruments now or hereafter securing this Note to contract in strict
            compliance
            with applicable usury law. In furtherance thereof, Lender and Borrower
            stipulate
            and agree that none of the terms and provisions contained in this Note,
            or in
            any other instrument executed in connection herewith, shall ever be construed
            to
            create a contract to pay for the use, forbearance or detention of money,
            interest at a rate in excess of the Maximum Rate; neither Borrower nor
            any
            guarantors, endorsers or other parties now or hereafter becoming liable
            for
            payment of this Note shall ever be obligated or required to pay interest
            on this
            Note at a rate in excess of the Maximum Rate that may be lawfully charged
            under
            applicable law, and the provisions of this Section shall control over
            all other
            provisions of this Note and any other instruments now or hereafter executed
            in
            connection herewith which may be in apparent conflict herewith. Lender
            expressly
            disavows any intention to charge or collect excessive unearned interest
            or
            finance charges in the event the maturity of this Note is accelerated.
            If the
            maturity of this Note shall be accelerated for any reason or if the principal
            of
            this Note is paid prior to the end of the term of this Note, and as a
            result
            thereof the interest received for the actual period of existence of the
            Loan
            exceeds the amount of interest that would have accrued at the Maximum
            Rate,
            Lender shall, at its option, either refund to Borrower the amount of
            such excess
            or credit the amount of such excess against the Principal Amount and
            thereby
            shall render inapplicable any and all penalties of any kind provided
            by
            applicable law as a result of such excess interest. In the event that
            Lender
            shall contract for, charge or receive any amounts and/or any other thing
            of
            value which are determined to constitute interest which would increase
            the
            effective interest rate on this Note to a rate in excess of that permitted
            to be
            charged by applicable law, all such sums determined to constitute interest
            in
            excess of the amount of interest at the lawful rate shall, upon such
            determination, at the option of Lender, be either immediately returned
            to
            Borrower or credited against the Principal Amount, in which event any
            and all
            penalties of any kind under applicable law as a result of such excess
            interest
            shall be inapplicable. By execution of this Note Borrower acknowledges
            that it
            believes the Loan to be non-usurious and agrees that if, at any time,
            Borrower
            should have reason to believe that the Loan is in fact usurious, it will
            give
            Lender notice of such condition and Borrower agrees that Lender shall
            have 90
            days in which to make appropriate refund or other adjustment in order
            to correct
            such condition if in fact such exists. The term “applicable
            law”
as
            used
            in this Note shall mean the laws of the State of Texas or the laws of
            the United
            States, whichever laws allow the greater rate of interest, as such laws
            now
            exist or may be changed or amended or come into effect in the
            future.

           

          
            
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          9.  Collection
            Fees.
            Should
            the indebtedness represented by this Note or any part thereof be collected
            at
            law or in equity or through any bankruptcy, receivership, probate or
            other court
            proceedings or if this Note is placed in the hands of attorneys for collection
            after an Event of Default, Borrower and all endorsers, guarantors and
            sureties
            of this Note jointly and severally agree to pay to Lender in addition
            to the
            principal and interest due and payable hereon reasonable attorneys’ and
            collection fees.

           

          10.  Waiver
            of Certain Notices.
            Borrower
            and all endorsers, guarantors and sureties of this Note and all other
            persons
            liable or to become liable on this Note severally waive presentment for
            payment,
            demand, notice of demand and of dishonor and nonpayment of this Note,
            notice of
            intention to accelerate the maturity of this Note, protest and notice
            of
            protest, diligence in collecting, and the bringing of suit against any
            other
            party, and agree to all renewals, extensions, modifications, partial
            payments,
            releases or substitutions of security, in whole or in part, with or without
            notice, before or after maturity.

           

          11.  CHOICE
            OF LAW.
            THIS
            NOTE AND THE OTHER LOAN DOCUMENTS AND THE RIGHTS AND OBLIGATIONS OF THE
            PARTIES
            HEREUNDER AND THEREUNDER SHALL IN ALL RESPECTS BE GOVERNED BY, AND CONSTRUED
            AND
            ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF TEXAS (WITHOUT
            GIVING
            EFFECT TO TEXAS' PRINCIPLES OF CONFLICTS OF LAW), EXCEPT TO THE EXTENT
            (A) OF
            PROCEDURAL AND SUBSTANTIVE MATTERS RELATING ONLY TO THE CREATION, PERFECTION,
            FORECLOSURE AND ENFORCEMENT OF RIGHTS AND REMEDIES AGAINST THE PROPERTY,
            WHICH
            MATTERS SHALL BE GOVERNED BY THE LAWS OF THE STATE WHERE THE PROPERTY
            IS
            LOCATED, AND (B) THE LAWS OF THE UNITED STATES OF AMERICA AND ANY RULES,
            REGULATIONS OR ORDERS ISSUED OR PROMULGATED THEREUNDER, APPLICABLE TO
            THE
            AFFAIRS AND TRANSACTIONS ENTERED INTO BY LENDER, OTHERWISE PREEMPT THE
            LAWS OF
            THE STATE WHERE THE PROPERTY IS LOCATED OR TEXAS LAW; IN WHICH EVENT
            FEDERAL LAW
            SHALL CONTROL.

           

          13.  FORUM
            SELECTION.
            BORROWER HEREBY IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION
            OF ANY
            STATE OR FEDERAL COURT SITTING IN DALLAS, TEXAS (OR ANY COURT OF COMPETENT
            JURISDICTION WHERE ANY PORTION OF THE PROPERTY IS LOCATED) OVER ANY SUIT,
            ACTION
            OR PROCEEDING ARISING OUT OF OR RELATING TO THIS NOTE OR ANY OF THE LOAN
            DOCUMENTS, AND BORROWER HEREBY AGREES AND CONSENTS THAT, IN ADDITION
            TO ANY
            METHODS OF SERVICE OF PROCESS PROVIDED FOR UNDER APPLICABLE LAW, ALL
            SERVICE OF
            PROCESS IN ANY SUCH SUIT, ACTION OR PROCEEDING IN ANY STATE OR FEDERAL
            COURT
            SITTING IN DALLAS, TEXAS (OR ANY COURT OF COMPETENT JURISDICTION WHERE
            ANY
            PORTION OF THE PROPERTY IS LOCATED) MAY BE MADE BY CERTIFIED OR REGISTERED
            MAIL,
            RETURN RECEIPT REQUESTED, DIRECTED TO BORROWER AT THE ADDRESS OF BORROWER
            FOR
            THE GIVING OF NOTICES UNDER THE SECURITY INSTRUMENT, AND SERVICE SO MADE
            SHALL
            BE COMPLETE 5 DAYS AFTER THE SAME SHALL HAVE BEEN SO
            MAILED.

           

          
            
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          14.  WAIVER
            OF TRIAL BY JURY AND CERTAIN OTHER RIGHTS

           

          .
            BORROWER
            AND LENDER HEREBY KNOWINGLY, INTENTIONALLY AND VOLUNTARILY, WITH AND
            UPON THE
            ADVICE OF COMPETENT COUNSEL, EXPRESSLY AND UNCONDITIONALLY WAIVE, IN
            CONNECTION
            WITH ANY SUIT, ACTION OR PROCEEDING IN CONNECTION WITH ANY OF THE LOAN
            DOCUMENTS, ANY AND EVERY RIGHT THEY MAY HAVE TO A TRIAL BY JURY. MAKER
            ACKNOWLEDGES THAT THE FOREGOING WAIVER IS KNOWING AND
            VOLUNTARY.

           

          15.  Time
            of the Essence.

           

          Time
            is of
            the essence of each obligation of Borrower hereunder.

           

          


           

          REMAINDER
            OF PAGE INTENTIONALLY BLANK

           

          SIGNATURE
            PAGE FOLLOWS

           

          


          
            
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          SIGNATURE
            PAGE OF BORROWER TO

           

          PROMISSORY
            NOTE

           

           

          Borrower’s
            Federal Tax I.D. No.

           

          38-3659381   

          ARC
            BRANDYWINE, L.P., a Delaware limited partnership

           

          
            	 	
                    By:

                  	
                    ARC
                      Brandywine GP, LLC, a Tennessee 
limited liability company, its general
                      partner

                  


          

           

            

           

          
            	 	By:	                                                       


            	 	
                    Name:

                  	                                                       
                    


            	 	Title: