Exhibit
10.49


 


RECORD AND RETURN TO:


 


Cassin Cassin &
Joseph LLP


711 Third Avenue,
20th Floor


New York, New York
10017


Attn:  Carol M. Joseph, Esq.


 


DEED OF
TRUST, ASSIGNMENT OF RENTS, SECURITY AGREEMENT AND FIXTURE FILING


 


 




 





 


MB SUGAR LAND
GILLINGHAM LIMITED PARTNERSHIP, an 

Illinois limited partnership, as trustor (Borrower)


 


 


to


 


WILLIAM
D. CLEVELAND, 

as trustee (“Trustee”)


 


for the benefit of


 


NOMURA CREDIT &
CAPITAL, INC. ,

as
beneficiary, and its successors and assigns (Lender)


 






 


THE COLLATERAL IS OR
INCLUDES FIXTURES


 


This
document serves as a fixture filing under the Uniform Commercial Code


 


Borrower’s Organizational Number:                             


Borrower’s Federal Identification No.:  20-4053426


 


	
  Date:

  	
  As of March 3, 2006

  
	
   

  	
   

  
	
  Location:

  	
  Thermo Process Systems
  Facility

  
	
   

  	
  1410 Gillingham Lane

  
	
   

  	
  Sugar Land, Texas 77478

  
	
   

  	
   

  
	
  County:

  	
  Fort Bend

  



 




 





 

















 


DEED OF TRUST, ASSIGNMENT OF RENTS,


SECURITY AGREEMENT AND FIXTURE FILING


 


THIS DEED OF TRUST, ASSIGNMENT OF RENTS, SECURITY
AGREEMENT AND FIXTURE FILING (this “Mortgage”)
is made as of this 3rd day of March, 2006, by MB SUGAR
LAND GILLINGHAM LIMITED PARTNERSHIP, an Illinois limited partnership, having its principal place of
business at 2901 Butterfield Road, Oak Brook, Illinois 60523, as mortgagor (“Borrower”), to WILLIAM D.
CLEVELAND, having an address at 909 Fannin Street, Suite 200,
Houston, Texas 77010, as trustee (“Trustee”),
for the benefit of NOMURA CREDIT &  CAPITAL, INC., a Delaware
corporation, its successors and assigns, having an address at 2 World Financial
Center, Bldg. B., New York, New York 10281, as beneficiary (“Lender”).


 


W I  T  N  E  S  S
E  T  H:


 


WHEREAS, this Mortgage is given to secure a loan (the “Loan”) in the principal sum of EIGHT
MILLION TWO HUNDRED ONE THOUSAND AND 00/100 DOLLARS ($8,201,000.00)
advanced 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”, and 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”), which Note provides, among
other things, for final payment of principal and interest thereunder, if not
sooner paid or payable as provided therein, to be due on March 11,
2031;


 


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


 


WHEREAS, this Mortgage is that certain “Deed of Trust”
or “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 limitations 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 Mortgage (the Loan Agreement, the Note, this
Mortgage, that certain Assignment of Leases and Rents of even date herewith
made by Borrower in favor 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 Mortgage:


 

















 


ARTICLE 1



GRANTS OF SECURITY


 


Section 1.1.                                   Property Mortgaged. Borrower does hereby irrevocably mortgage,
grant, bargain, pledge, assign, warrant, transfer and convey to Trustee and its
successors in trust for the benefit of Lender, WITH POWER OF SALE and grant a
security interest to Trustee and its successors in trust, in each case for the
benefit of Lender, in 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 Mortgage;


 


(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 Mortgage and all
proceeds and products of the above;


 


(h)                                 Leases and Rents. All leases, subleases or sub-subleases, 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, sub-subleases, or other
agreements entered into in connection with such leases, subleases,
sub-subleases, 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 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,


 


3

















 


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;


 


(l)                                     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;


 


(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;


 


4

















 


(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 Mortgage, to the extent permitted by applicable law, Borrower expressly
grants to 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 Mortgage be deemed conclusively to be real estate and
mortgaged hereby.


 


Section 1.2.                                   Assignment of Rents. Borrower hereby absolutely and unconditionally
assigns to 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 Mortgage, 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.


 


Section 1.3.                                   Security Agreement. This Mortgage is both a real property deed of
trust 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 Mortgage, Borrower hereby grants
to 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


 


5

















 


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.


 


Section 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 Mortgage, and this Mortgage, 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 Mortgage. 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 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.


 


Section 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 Mortgage or in the Loan
Agreement.


 


6

















 


CONDITIONS TO GRANT


 


TO HAVE AND TO HOLD the above granted and described
Property unto Trustee, as trustee for the benefit of Lender, and its successors
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 Mortgage;


 


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
Mortgage, shall well and truly perform the Other Obligations as set forth
in this Mortgage 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 Lender shall promptly thereafter
mark the Note “paid in full” and will, at Borrower’s sole cost and expense,
release the lien of this Mortgage (and Lender agrees to make reasonable efforts
to do so within thirty days following the satisfaction of the conditions herein
set forth and Borrower’s written request thereafter to provide such release);
provided, however, that Borrower’s obligation to indemnify and hold harmless
Lender pursuant to the provisions hereof shall survive any such payment or
release.


 


ARTICLE 2



DEBT AND OBLIGATIONS SECURED


 


Section 2.1.                                   Debt.
This Mortgage and the grants, assignments and transfers made in Article 1
are given for the purpose of securing the following, in such order of priority
as Lender may determine in its sole discretion (the “Debt”):


 


(a)                                  the payment of the indebtedness evidenced by the
Note in lawful money of the United States of America;


 


(b)                                 the payment of interest, prepayment premiums,
default interest, late charges and other sums, as provided in the Note, the
Loan Agreement, this Mortgage and the other Loan Documents;


 


(c)                                  the payment of all other moneys agreed or provided
to be paid by Borrower in the Note, the Loan Agreement, this Mortgage or the
other Loan Documents;


 


(d)                                 the payment of all sums advanced pursuant to this
Mortgage to protect and preserve the Property and the lien and the security
interest created hereby; and


 


(e)                                  the payment of all sums advanced and costs and
expenses incurred by Lender in connection with the Debt or any part thereof,
any renewal, extension, or change of or substitution for the Debt or any part thereof,
or the acquisition or perfection of the security therefor, whether made or
incurred at the request of Borrower or Lender.


 


7

















 


Section 2.2.                                   Other Obligations. This Mortgage 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.


 


Section 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 3



BORROWER COVENANTS


 


Borrower covenants
and agrees that:


 


Section 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 Mortgage.


 


Section 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
Mortgage to the same extent and with the same force as if fully set forth
herein.


 


Section 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.


 


Section 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.


 


Section 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


 


8

















 


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 Mortgage. 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.


 


Section 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 Mortgage 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.


 


Section 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.


 


Section 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


 


9

















 


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.


 


Section 3.9.                                   Title. Borrower has good and indefeasible 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 Mortgage, 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 Mortgage.


 


Section 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 Mortgage 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 Mortgage.


 


ARTICLE 4



OBLIGATIONS AND RELIANCES


 


Section 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 Mortgage 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.


 


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Section 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.


 


Section 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
Mortgage, 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.


 


Section 4.4.                                   Reliance. Borrower recognizes and acknowledges that in accepting the Loan
Agreement, the Note, this Mortgage 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 Mortgage in the absence of the
warranties and representations as set forth in Section 4.1 of the Loan
Agreement.


 


ARTICLE 5



FURTHER ASSURANCES


 


Section 5.1.                                   Recording of Mortgage, Etc. Borrower forthwith upon the execution and
delivery of this Mortgage and thereafter, from time to time, will cause this
Mortgage 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 Mortgage, 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,


 


11

















 


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 Mortgage, 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.


 


Section 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 Mortgage or for filing, registering or
recording this Mortgage, 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.


 


Section 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 Mortgage 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 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 Mortgage 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.


 


12

















 


(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 Mortgage, 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.


 


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


 


Section 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 6



DUE ON SALE/ENCUMBRANCE


 


Section 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.


 


Section 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.


 


Section 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


 


13

















 


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 sole member or general
partner of Borrower (or the stock of
any corporation directly or indirectly controlling such sole member or 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 sole member’s or 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 membership interest in Borrower or
partnership interest in Borrower’s general partner; (e) if Borrower, any sole
member or 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.


 


Section 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 Mortgage 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 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 7



RIGHTS AND REMEDIES UPON DEFAULT


 


Section 7.1.                                   Remedies. Upon the occurrence and during the continuance of any Event of Default,
Borrower agrees that Lender may take such action, without notice or
demand,


 


14

















 


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 may determine, in its sole
discretion, without impairing or otherwise affecting the other rights and
remedies of Lender:


 


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


 


(b)                                 institute proceedings, judicial or otherwise, for
the complete foreclosure of this Mortgage 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 Mortgage for the portion of the Debt then
due and payable, subject to the continuing lien and security interest of this
Mortgage 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;


 


(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 Mortgage 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


 


15

















 


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 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 Mortgage 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 Mortgage and the other Loan Documents, including without
limitation advances made by Lender pursuant to the terms of this Mortgage;


 


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


 


(l)                                     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;


 


16

















 


(m)                               under the power of sale granted hereunder or under
applicable law, Lender or Trustee shall have the discretionary right to cause
some or all of the Property, including any Personal Property, to be sold or
otherwise disposed of in any combination and in any manner permitted by
applicable law. Any such foreclosure under the power of sale which is hereby
conferred, shall be accomplished in accordance with the following provisions:


 


(i)                                     Public Sale. If  an Event of Default shall occur
and the Debt, shall, at the option of Lender, become at once due and payable,
then, without limitation to any other rights or remedies of Lender contained
herein, Trustee shall be and is hereby authorized and empowered, when requested
so to do by Lender after such default, to sell the Property covered hereby at
public auction to the highest bidder for cash during a three-hour period
designated in the notice of foreclosure between the hours of ten o’clock a.m.
and four o’clock p.m. of the first Tuesday in any month, at the location
within the courthouse or within a reasonable proximity of the courthouse, as may have
been properly designated by the County Commissioner of such county, or if none
is so designated, then at the door of the County Courthouse in the county in
which the Property or any part thereof is situated, after complying with
the statutes and procedures of the State of Texas governing such sales and
after advertising the time, place, and terms of said sale and the property to
be sold;


 


(ii)                                  Notice. Notice of said sale shall be posted for at least twenty-one (21) days
preceding the date of sale written or printed notice thereof at the courthouse
door of the county in which the sale is to be made and if the Property is
located in more than one county, one notice shall be posted at the courthouse
door of each county in the Property is located. In addition to such posting of
notice, Lender shall at least twenty-one (21) days preceding the date of sale
file a copy of such notice with the Clerk of the County in which the Property
is located and shall serve written notice of the proposed sale by U.S.
certified mail on Borrower and on each other debtor who, according to the
records of Lender or any mortgage servicer, is obligated to pay on the Debt, if
any. Lender shall disclose in any notice required hereunder that, if
applicable, a mortgage servicer is acting on behalf of Lender under a servicing
agreement, and shall include the address of the Lender or such servicer, if
acting under an agreement, and disclose the name and address of the trustee or
any substitute trustee. Service of such notice shall become complete when the
notice is deposited in the U.S. certified mail, postage prepaid, and properly
addressed to Borrower and such other debtors at their most recent address or
addresses as shown by the records of Lender in a post office or official
depository under the care and custody of the United States Postal Service. The
affidavit of any person having knowledge of the facts to the effect that such
service was completed shall be prima facie evidence of the fact of service. Borrower
agrees that no notice of any sale other than as set out in this paragraph need
be given by Trustee, Lender or any other person. Notwithstanding the foregoing
provisions of this paragraph, notice of such sale given in accordance with the
applicable laws of the State of Texas in effect at the time of such sale shall
constitute sufficient notice of such sale; and


 


(iii)                               Lender right to bid. Lender may bid and become the purchaser of
the Property at any such sale.


 


17

















 


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


 


Section 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 Mortgage 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.


 


Section 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 foreclose this Mortgage 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 Mortgage
and the other Loan Documents and shall be immediately due and payable upon
demand by Lender therefor.


 


Section 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.


 


Section 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.


 


Section 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


 


18

















 


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. The action contemplated by this Section 7.6
shall be at Lender’s sole cost and expense, unless an Event of Default shall be
continuing, in which event such action shall be at Borrower’s sole cost and
expense.


 


Section 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 Mortgage. 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 Mortgage 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 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 Mortgage 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, 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 Mortgage. The rights of Lender or Trustee under this Mortgage
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.


 


Section 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
Mortgage, 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 Mortgage shall continue as a lien
and security interest in the remaining portion of the Property.


 


19

















 


Section 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.


 


Section 7.10.                             Recourse and Choice of Remedies. Notwithstanding any other provision of this
Mortgage 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 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 Mortgage 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 Mortgage 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.


 


Section 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.


 


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


 


ARTICLE 8



ENVIRONMENTAL HAZARDS


 


Section 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


 


20

















 


(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, applicable 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
applicable 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
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, applicable 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,


 


21

















 


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.


 


Section 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 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


 


22

















 


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.


 


Section 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 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 9



INDEMNIFICATIONS


 


Section 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


 


23

















 


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 MORTGAGE, 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 MORTGAGE, 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 MORTGAGE 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 MORTGAGE, OR TO SUPPLY A COPY THEREOF IN A
TIMELY FASHION TO THE RECIPIENT OF THE PROCEEDS OF THE TRANSACTION IN
CONNECTION WITH WHICH THIS MORTGAGE 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
THE FUNDING OF THE LOAN; OR (K) ANY MISREPRESENTATION MADE BY BORROWER IN THIS
MORTGAGE 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


 


24

















 


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 MORTGAGE 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).


 


Section 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 MORTGAGE, 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.


 


25

















 


Section 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.


 


Section 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


 


26

















 


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 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 MORTGAGE, SUBJECT TO THE
PROVISIONS OF SECTION 10.5.


 


Section 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


 


27

















 


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 10



WAIVERS


 


Section 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 Mortgage,
the Loan Agreement, the Note, any of the other Loan Documents, or the
Obligations.


 


Section 10.2.                             Marshalling and Other Matters. To the fullest extent permitted by applicable
law, Borrower hereby waives 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 Mortgage 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 Mortgage and on behalf of all persons to the extent permitted
by applicable law.


 


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


 


Section 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.


 


Section 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 Mortgage, any assignment or other
transfer of all or any portion of this Mortgage or Lender’s interest in the
Property (but, in such


 


28

















 


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 Mortgage, 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 Mortgage 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 11



EXCULPATION


 


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


 


ARTICLE 12



NOTICES


 


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


 


ARTICLE 13



APPLICABLE LAW


 


Section 13.1.                             GOVERNING LAW. THIS MORTGAGE 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.


 


29

















 


Section 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.


 


Section 13.3.                             Provisions Subject to Applicable Law. All rights, powers and remedies provided in this
Mortgage 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 Mortgage
invalid, unenforceable or not entitled to be recorded, registered or filed
under the provisions of any applicable law. If any term of this Mortgage or any
application thereof shall be invalid or unenforceable, the remainder of this
Mortgage and any other application of the term shall not be affected thereby.


 


ARTICLE 14



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 Mortgage 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 Mortgage,” 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 15



MISCELLANEOUS PROVISIONS


 


Section 15.1.                             No Oral Change. This Mortgage, 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.


 


30

















 


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


 


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


 


Section 15.4.                             Headings, Etc. The headings and captions of various Sections of this Mortgage 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.


 


Section 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.


 


Section 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.


 


Section 15.7.                             Entire Agreement. The Note, the Loan Agreement, this Mortgage 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 Mortgage 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 Mortgage
and the other Loan Documents.


 


Section 15.8.                             Limitation on Lender’s Responsibility. No provision of this Mortgage 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.”


 


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ARTICLE 16



CONCERNING THE TRUSTEE


 


Section 16.1.                             No Required Action. Trustee shall not be required to take any action
toward the execution and enforcement of the trust hereby created or to
institute, appear in, or defend any action, suit, or other proceeding in
connection therewith where, in his opinion, such action would be likely to
involve him in expense or liability, unless requested so to do by a written
instrument signed by Lender and, if Lender so requests, unless Trustee is
tendered security and indemnity satisfactory to Trustee against any and all
cost, expense, and liability arising therefrom. Trustee shall not be
responsible for the execution, acknowledgment, or validity of the Loan
Documents, or for the proper authorization thereof, or for the sufficiency of
the lien and security interest purported to be created hereby, and Trustee
makes no representation in respect thereof or in respect of the rights,
remedies, and recourses of Lender.


 


Section 16.2.                             Certain Rights. With the approval of Lender, Trustee shall have the right to take any
and all of the following actions:  (i) to
select, employ, and consult with counsel (who may be, but need not be,
counsel for Lender) upon any matters arising hereunder, including the
preparation, execution, and interpretation of the Loan Documents, and shall be
fully protected in relying as to legal matters on the advice of counsel, (ii) to
execute any of the trusts and powers hereof and to perform any duty
hereunder either directly or through his agents or attorneys in accordance with
the terms of this Mortgage and applicable law, (iii) to select and employ,
in and about the execution of his duties hereunder, suitable accountants,
engineers and other experts, agents and attorneys-in-fact, either corporate or
individual, not regularly in the employ of Trustee (and Trustee shall not be
answerable for any act, default, negligence, or misconduct of any such accountant,
engineer or other expert, agent or attorney-in-fact, if selected with
reasonable care, or for any error of judgment or act done by Trustee in good
faith, or be otherwise responsible or accountable under any circumstances
whatsoever, except for Trustee’s gross negligence or bad faith), and (iv) any
and all other lawful action that Lender may instruct Trustee to take to
protect or enforce Lender’s rights hereunder. Trustee shall not be personally
liable in case of entry by Trustee, or anyone entering by virtue of the powers
herein granted to Trustee, upon the Property for debts contracted for or
liability or damages incurred in the management or operation of the Property. Trustee
shall have the right to rely on any instrument, document, or signature authorizing
or supporting any action taken or proposed to be taken by Trustee hereunder,
believed by Trustee in good faith to be genuine. Trustee shall be entitled to
reimbursement for expenses incurred by Trustee in the performance of Trustee’s
duties hereunder and to reasonable compensation for such of Trustee’s services
hereunder as shall be rendered. Borrower will, from time to time, pay the
compensation due to Trustee hereunder and reimburse Trustee for, and save
Trustee harmless against, any and all liability and expenses which may be
incurred by Trustee in the performance of Trustee’s duties.


 


Section 16.3.                             Retention of Money. All moneys received by Trustee shall, until used
or applied as herein provided, be held in trust for the purposes for which they
were received, but need not be segregated in any manner from any other moneys
(except to the extent required by applicable law), and Trustee shall be under
no liability for interest on any moneys received by Trustee hereunder.


 


32

















 


Section 16.4.                             Successor Trustees. Trustee may resign by the giving of notice
of such resignation in writing or verbally to Lender. If Trustee shall die,
resign, or become disqualified from acting in the execution of this trust, or if,
for any reason, Lender shall prefer to appoint a substitute trustee or multiple
substitute trustees, or successive substitute trustees or successive multiple
substitute trustees, to act instead of the aforenamed Trustee, Lender shall
have full power to appoint a substitute trustee (or, if preferred, multiple
substitute trustees) in succession who shall succeed (and if multiple
substitute trustees are appointed, each of such multiple substitute trustees
shall succeed) to all the estates, rights, powers, and duties of the aforenamed
Trustee. Such appointment may be executed by any authorized agent of
Lender, and if such Lender be a corporation and such appointment be executed in
its behalf by any officer of such corporation, such appointment shall be conclusively
presumed to be executed with authority and shall be valid and sufficient
without proof of any action by the board of directors or any superior officer
of the corporation. Borrower hereby ratifies and confirms any and all acts
which the aforenamed Trustee, or his successor or successors in this trust,
shall do lawfully by virtue hereof. If multiple substitute Trustees are
appointed, each of such multiple substitute Trustees shall be empowered and
authorized to act alone without the necessity of the joinder of the other
multiple substitute trustees, whenever any action or undertaking of such
substitute trustees is requested or required under or pursuant to this Mortgage
or applicable law. The Lender may appoint or authorize a mortgage servicer
to appoint a substitute trustee, such appointment or authorization to be made
by power of attorney, corporate resolution or other written instrument. A
mortgage servicer may authorize an attorney to appoint a substitute
trustee or substitute trustees on behalf of Beneficiary. The name and street
address of such trustee or substitute trustee shall be disclosed on the notice
of sale required by Section 51.002 of the Texas Property Code.


 


Section 16.5.                             Perfection of Appointment. Should any deed, conveyance, or instrument of
any nature be required from Borrower by any Trustee or substitute Trustee to
more fully and certainly vest in and confirm to the Trustee or substitute
Trustee such estates, rights, powers, and duties, then, upon request by the
Trustee or substitute Trustee, any and all such deeds, conveyances and
instruments shall be made, executed, acknowledged, and delivered and shall be
caused to be recorded and/or filed by Borrower.


 


Section 16.6.                             Succession Instruments. Any substitute Trustee appointed pursuant to any
of the provisions hereof shall, without any further act, deed, or conveyance,
become vested with all the estates, properties, rights, powers, and trusts of
its or his predecessor in the rights hereunder with like effect as if
originally named as Trustee herein; but nevertheless, upon the written request
of Lender or of the substitute Trustee, the Trustee ceasing to act shall
execute and deliver any instrument transferring to such substitute Trustee,
upon the trusts herein expressed, all the estates, properties, rights, powers,
and trusts of the Trustee so ceasing to act, and shall duly assign, transfer
and deliver any of the property and moneys held by such Trustee to the
substitute Trustee so appointed in the Trustee’s place.


 


Section 16.7.                             No Representation by Trustee. By accepting or approving anything required to
be observed, performed, or fulfilled or to be given to Trustee (on its own
behalf or on behalf of Lender) pursuant to the 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, neither Trustee nor Lender shall be deemed to have


 


33

















 


warranted, consented to, or affirmed the sufficiency, legality,
effectiveness, or legal effect of the same, or of any term, provision, or
condition thereof, and such acceptance or approval thereof shall not be or
constitute any warranty or affirmation with respect thereto by Trustee, either
on its own behalf or on behalf of Lender.


 


[Signature Page to
Follow]


 


34

















 


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


 


	
   

  	
  BORROWER:

  
	
   

  	
   

  
	
   

  	
  MB
  SUGAR LAND GILLINGHAM LIMITED

  
	
   

  	
  PARTNERSHIP, an Illinois limited partnership

  
	
   

  	
   

  
	
   

  	
  By:

  	
  MB
  SUGAR LAND GILLINGHAM GP,

  
	
   

  	
   

  	
  L.L.C., a Delaware limited liability company,

  
	
   

  	
   

  	
  Its General Partner

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  MINTO
  BUILDERS (FLORIDA), INC.,

  
	
   

  	
   

  	
   

  	
  a Florida corporation, Its Sole Member

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
    /s/ Debra A. Palmer

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Debra A. Palmer

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Assistant
  Secretary

  
							



 


 


ACKNOWLEDGMENT


 


	
  STATE OF ILLINOIS

  	
  )

  
	
   

  	
  : ss.:

  
	
  COUNTY OF DUPAGE

  	
  )

  



 


BEFORE ME, the
undersigned, a Notary Public in and for said County and State, on this day
personally appeared                                                            ,
in his/her capacity as                                               
of MINTO BUILDERS (FLORIDA), INC., a
Florida corporation, the Sole Member on behalf of MB SUGAR
LAND GILLINGHAM GP, L.L.C., a Delaware limited liability company,
the General Partner of behalf of MB SUGAR LAND GILLINGHAM
LIMITED PARTNERSHIP, an
Illinois limited partnership, known to me to be the person whose name is
subscribed to the foregoing instrument, and, being by me first duly sworn,
declared and acknowledged to me under oath that he/she executed the same for
the purposes and consideration therein expressed and in the capacity therein
stated, as the act and deed of said limited partnership on behalf of the
limited partnership.


 


GIVEN UNDER MY HAND AND SEAL OF OFFICE this              
day of March, 2006.


 


	
   

  	
   

  	
   

  
	
   

  	
  Notary Public in and for

  	
   

  	
   

  
	
   

  	
  County, State of

  	
   

  	
   

  
					



 

















 


EXHIBIT A



LEGAL DESCRIPTION