Exhibit
10.36


 


CONSTRUCTION LOAN AND
SECURITY AGREEMENT


 


This
Construction Loan and Security Agreement is made as of February 6th,
2009, by and between Tradeport Development III, LLC, a Connecticut limited
liability company, with a usual place of business at 204 West Newberry Road,
Bloomfield, Connecticut (the “Borrower”), Griffin Land & Nurseries, Inc.,
a Delaware corporation with a usual place of business at 204 West Newberry
Road, Bloomfield, Connecticut (the “Guarantor”) and Berkshire Bank, a Massachusetts
banking corporation, with a usual place of business at 31 Court Street,
Westfield, Massachusetts.


 


1.00 DEFINITIONS AND RULES OF INTERPRETATION.


 


1.01 DEFINITIONS


 


The
following terms shall have the meanings set forth in this Section 1.01 or
elsewhere in the provisions of this Agreement or other Loan Documents referred
to below:


 


“Advance”
shall mean, any disbursement of the proceeds of the Construction Loan made or
to be made by the Lender pursuant to this Agreement.


 


“Agreement”
shall mean, this Agreement, including the Schedules and Exhibits hereto, all of
which are incorporated herein by reference.


 


“Appraisal”
shall mean, an appraisal of the value of the Project, determined on an orderly
as stabilized basis, performed by a qualified independent appraiser approved by
the Lender.


 


“Architect’s
Contract” shall mean, the contract, dated January 19, 2009 between
the Borrower and Cutler Associates, Inc. (the “Borrower’s Architect”), to
provide for the design of the Improvements and the supervision of the construction
thereof.


 


“Assignment
of Leases” shall mean, the Assignment of Leases and Rents, dated or to be dated
on or prior to the Closing Date, made by the Borrower in favor of the Lender,
pursuant to which the Borrower assigns its right, title and interest as
landlord in and to the Leases and the rents, issues and profits of the Project,
such Assignment of Leases and Rents to be in form and substance satisfactory to
the Lender.


 


“Assignment
of Project Documents” shall mean, the Assignment of Project Documents, dated or
to be dated on or prior to the Closing Date, made by the Borrower in favor of
the Lender, pursuant to which the Borrower assigns and grants a security
interest in the Borrower’s right, title and interest in and to the Architect’s
Contract, the Construction Contract, the Plans and Specifications and the
Project Approvals, such Assignment of Project Documents to be in form and
substance satisfactory to the Lender.


 


“Borrower”
shall have the meaning as defined in the preamble hereto.


 


“Borrower’s
Requisition”.  See Section 3.01.


 


“Building
Consultant” shall mean Cutler Associates, Inc., having an address of 43
Harvard Street, Worcester, MA 01615.


 


“Building
Contractor shall mean Cutler Associates, Inc., having an address of 43
Harvard Street, Worcester, MA 01615.


 


“Business
Day” shall mean, any day on which the Lender is open for the transaction of
banking business in Springfield, Massachusetts.


 


“CERCLA”.    See Section 9.15(a).


 


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“Closing
Date” shall mean, the first date on which the conditions set forth in Section 12.00
have been satisfied and any Advances are to be made.


 


“Code”
shall mean, the Internal Revenue Code of 1986.


 


“Collateral”
shall mean, all of (a) the property, rights and interests of the Borrower
that are or are intended to be subject to the security interests, assignments,
and mortgage liens created by the Security Documents, including, without
limitation, that which is defined in Section 14.00 hereof.


 


“Commitment”
shall mean, the Commitment Letter for the Construction Loan issued by the
Lender to the Borrower, dated January 22, 2009.


 


“Completion
Date”  shall mean, twelve (12) months
from the Closing Date.


 


“Construction
Contract” shall mean, the contract, dated January 8, 2009 between
the Borrower and the Contractor, providing for the construction of the
Improvements on the Land, as amended from time to time, with prior approval of
the Lender.


 


“Construction
Inspector”  shall mean,  Swinerton Management and Consulting or, at the
Lender’s option, either an officer or employee of the Lender or consulting
architects, engineers or inspectors appointed by the Lender from time to time.


 


“Construction
Loan”  shall mean, the construction loan
which is the subject of this Agreement.


 


“Construction
Loan Amount” shall mean the lesser of (i)  seventy percent (70%) of total
Project Costs approved by the Lender and the Construction Inspector to
construct the Improvements; or (ii)  seventy percent (70%) of the
appraised value of the land on an as-built basis,
such sums are not to exceed Twelve Million and 00/100 Dollars ($12,000,000.00).


 


“Construction
Loan Checking Account”.  See Section 3.03.


 


“Construction
Note”  shall mean, the Promissory Note in
the principal face amount of the Construction Loan Amount dated or to be dated
on or prior to the Closing Date, made by the Borrower to the order of the
Lender, such Promissory Note to be in form and substance satisfactory to the
Lender.


 


“Construction
Schedule”  shall mean, the schedule,
broken down by trade, job and subcontractor, of the estimated dates of
commencement and completion of construction of the Improvements, prepared by
the Contractor, approved by the Lender and attached hereto as Exhibit “A”.


 


“Contingency
Reserve” shall mean, the amount(s) allocated as contingency reserve(s) in
the Project Budget, to be advanced only in accordance with the provisions of Section 2.06
hereof.


 


“Contractor”
shall collectively mean the Site Work Contractor and the Building Contractor.


 


“Contractor’s
Subordination Agreement”.  See Section 11.05.


 


“Debt”
means, as applied to any Person, as of any date of determination (without
duplication):


 


(a)                                 all obligations
of such Person for borrowed money (whether or not represented by bonds,
debentures, notes, drafts or other similar instruments) or evidenced by bonds,
debentures, notes, drafts or similar instruments;


 


(b)                                all obligations
of such Person for all, or any part of, the deferred purchase price of property
or services, or for the cost of property constructed or of improvements
thereon, other than trade accounts payable incurred, in respect of property
purchased, in the ordinary course of business, which are not overdue or which
are being contested in good 


 


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faith by appropriate proceedings and are not required to be classified
on such Person’s balance sheet, in accordance with GAAP, as debt;


 


(c)                                 all obligations
secured by any Lien on or payable out of the proceeds of production from
property owned or held by such Person even though such Person has not assumed
or become liable for the payment of such obligation;


 


(d)                                all capital
lease obligations of such Person;


 


(e)                                 all obligations
of such Person, contingent or otherwise, in respect of any letter of credit
facilities, bankers’ acceptance facilities or other similar credit facilities
other than any such obligation which relate to an underlying obligation which
otherwise constitutes Debt of such Person hereunder or a current account
payable of such Person incurred in the ordinary course of business;


 


(f)                                   all obligations
of such Person upon which interest payments are customarily made; and


 


(g)                                all Guaranties
by such Person of or with respect to obligations of the character referred to
in the foregoing clauses (a) through (f) of another Person;


 


provided, however,
that in determining the Debt of any Person, (i) all liabilities for which
such Person is jointly and severally liable with one or more other Persons
(including, without limitation, all liabilities of any partnership or joint
venture of which such Person is a general partner or co-venturer) shall be
included at the full amount thereof without regard to any right such Person may
have against any such other Persons for contribution or indemnity, and (ii) no
effect shall be given to deposits, trust arrangements or similar arrangements
which, in accordance with GAAP, extinguish Debt for which such Person remains
legally liable.


 


“Debt
Service Coverage Calculation Period” means twelve (12) calendar months
commencing on December 1st and ending on November 30th,
and it shall be conducted annually thereafter.”


 


“Debt
Service Coverage Ratio” means on each calculation date for the applicable Debt
Service Coverage Ratio Calculation Period, by calculating the ratio of (x) the
Net Operating Income from the Mortgaged Premises for the immediately preceding
Debt Service Coverage Ratio Calculation Period, to (y) the sum of the
monthly payments of principal and interest which were due and payable under the
Note for the immediately preceding Debt Service Coverage Ratio Calculation
Period.


 


“Default”
shall mean, a condition or event which would, with the giving of notice or
lapse of time or both, constitute an Event of Default.


 


“Default
Rate”  shall mean, the default rate of
interest set forth in the Construction Note.


 


“Direct
Costs” shall mean, the costs of the , the Personal Property and all labor,
materials, fixtures, machinery and equipment required to construction,
equipment and complete the Improvements in accordance with the Plans and
Specifications.


 


“Disbursement
Schedule”  shall mean, the schedule of
the amounts of Advances anticipated to be requisitioned by the Borrower each
month during the term of the construction of the Improvements (including an
itemization of Direct Costs and Indirect Costs to be included in each such
requisition), approved by the Lender and attached hereto as Exhibit “B”.


 


“Distribution”  shall mean, the declaration or payment of any
distribution of cash or cash flow to the members of the Borrower, or other
distribution on or in respect to any membership interests of the Borrower.


 


“Drawdown
Date”  shall mean, the date on which any
Advance is made or is to be made.


 


“Draw
Request”  shall mean that with respect to
each Advance, the Borrower’s Requisition for such Advance, and documents
required by this Agreement to be furnished to the Lender as a condition to such
Advance.


 


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“Employee
Benefit Plan”  shall mean, any employee
benefit plan within the meaning of Section 3(3) of ERISA maintained
or contributed to by the Borrower or any ERISA Affiliate, other than a Multi-
employer Plan.


 


Environmental
Laws.  See Section 9.15.(a).


 


“ERISA”
shall mean, the Employee Retirement Income Security Act of 1974, as amended and
in effect from time to time.


 


“ERISA
Affiliate” shall mean, any Person which is treated as a single employer with
the Borrower under Section 414 of the Code.


 


“Event
of Default”.    See Section 15.01


 


“Financing
Statements” shall mean, Uniform Commercial Code Form 1 Financing Statement(s) from
the Borrower in favor of the Lender giving notice of a security interest in the
Collateral, such financing statements to be in form and substance satisfactory
to the Lender.


 


“Fund
the Expansion” means a commitment by Lender to finance the expansion of the
Project at the Mortgaged Premises following the issuance of a final Certificate
of Occupancy.


 


“Funding
Date of Construction Loan” shall mean, the date when the proceeds of the
Construction Loan are actually advanced in accordance with this Agreement.


 


“Funding
Request Documents” .  See Section 3.01.


 


“Generally
Accepted Accounting Principles” shall mean, principles that are consistent with
the principles promulgated or adopted by the Financial Accounting Standards
Board and its predecessors, as in effect from time to time; provided that a
certified public accountant would, insofar as the use of such accounting
principles is pertinent, be in a position to deliver an unqualified opinion
(other than a qualification regarding changes in generally accepted accounting
principles) as to financial statements in which such principles have been
properly applied.


 


“Governmental
Authority” shall mean, the United States of America, the State of Connecticut,
any political subdivision thereof, the City/Town of Windsor, and any agency,
authority, department, commission, board, bureau, or instrumentality of any of
them.


 


“Gross
Revenues” means for each Loan Month, all rents, revenues and other payments
received by, or for the benefit of Borrower in cash or current funds or other
consideration from any source whatsoever in connection with its ownership,
operation and management of the Mortgaged Premises, including all payments
received by Borrower from all tenants or other occupants of the Mortgaged
Premises; provided, however, secured deposits paid to Borrower by tenants under
leases at the Mortgaged Premises and insurance proceeds following a casualty or
damage by fire or other cause at the Mortgaged Premises, shall not be included
in Gross Revenues.


 


“Guarantor”
shall mean, Griffin Land & Nurseries, Inc.


 


“Guaranty”
shall mean, the Unconditional Guaranty of Payment and Performance, dated or to
be dated on or prior to the Closing Date, made by the Guarantor in favor of the
Lender, pursuant to which the Guarantor guarantees to the Lender the payment
and performance of the Obligations (such Guaranty to be in form and substance
satisfactory to the Lender) limited to the period of time from the Closing to
the receipt of the Certificate of Occupancy and performance of the completion
of the Project.


 


“Hazardous
Materials”.    See, Section 9.15(b).


 


“Head
Office” shall mean 31 Court Street, Westfield, Massachusetts.


 


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“Impositions”  means with respect to Borrower relating to
the Mortgaged Premises, all taxes of every kind and nature, sewer rents,
charges for water, for setting or repairing meters and for all other utilities
serving the Mortgaged Premises, and assessments, levies, inspection and license
fees and all other charges imposed or assessed against the Mortgaged Premises
or any portion thereof, including the income derived from the Mortgaged
Premises and any stamp or other taxes which might be required to be paid with
respect to the Loan Documents, any of which might, if unpaid, result in a lien
on the Mortgaged Premises or any portion thereof, regardless of whom assessed.


 


“Improvements”
shall mean, a Class “A” build-to-suit industrial warehouse containing
304,200 square feet for the Primary Tenant to be constructed on the Land in
accordance with the Plans and Specifications.


 


“Incipient
Default” means any event or condition which, with the giving of notice or the
lapse of time, or both, would become an Event of Default.


 


“Indebtedness”
shall mean, all obligations, contingent and otherwise, that in accordance with
generally accepted accounting principles should be classified upon the Borrower’s
balance sheet as liabilities, or to which reference should be made by footnotes
thereto, including in any event and whether or not so classified: (a) all
debt and similar monetary obligations, whether direct or indirect; (b) all
liabilities secured by any mortgage, pledge, security interest, lien, charge,
or other encumbrance existing on property owned or acquired subject thereto,
whether or not the liability secured thereby shall have been assumed; and (c) all
guarantees, endorsements and other contingent obligations whether direct or
indirect in respect of indebtedness of others, including any obligation to
supply funds to or in any manner to invest in, directly or indirectly, the
Borrower, to purchase indebtedness, or to assure the owner of indebtedness
against loss, through an agreement to purchase goods, supplies, or services for
the purpose of enabling Borrower to make payment of the indebtedness held by
such owner or otherwise, and the obligations to reimburse the issuer in respect
of any letters of credit.


 


“Indemnity
Agreement”  shall mean, the Indemnity
Agreement Regarding Hazardous Materials, dated or to be dated on or prior to
the Closing Date, made by the Borrower and the Guarantor in favor of the
Lender, pursuant to which the Borrower and the Guarantor agree to indemnify the
Lender with respect to Hazardous Materials and Environmental Laws, such
Indemnity Agreement to be in form and substance satisfactory to the Lender.


 


“Indirect
Costs”  shall mean, Title insurance
premiums, survey charges, engineering fees, architectural fees, real estate
taxes, appraisal costs, loan fees and interest payable to the Lender under the
Construction Loan, premiums for insurance, marketing, advertising and leasing
costs, brokerage commissions, legal fees, accounting fees, overhead and
administrative costs, and all other expenses which are expenditures relating to
the Project and are not Direct Costs.


 


“Interest
Charges” for any period shall mean all interest (including the imputed interest
factor in respect of Capitalized Leases) and all amortization of debt discount
and expense on any particular Indebtedness for which such calculations are
being made. Computations of Interest Charges on a proforma basis for
indebtedness having a variable interest rate shall be calculated at the rate in
effect on the day of any determination.


 


“Interest
Expense” means for any period, the sum of the following amounts for the
Borrower: (a) the aggregate amount of all interest accrued (whether or not
actually paid) during such period in respect of Debt (including, without
limitation, imputed interest on Capital Leases), plus (b) amortization of
debt discount and expense.


 


“Investments”
shall mean, all expenditures made and all liabilities incurred (contingently or
otherwise) for the acquisition of stock or Indebtedness of, or for loans,
advances, capital contributions or transfers of property to, or in respect of
any guaranties (or other commitments as described under Indebtedness), or
obligations of, any Person. In determining the aggregate amount of Investments
outstanding at any particular time:  (a) the
amount of any Investment represented by a guaranty shall be taken at not less
than the principal amount of the obligations guaranteed and still outstanding; (b) there
shall be included as an Investment all interest accrued with respect to
Indebtedness constituting an Investment unless and until such interest is paid;
(c) there shall be deducted in respect of each such Investment any amount
received as a return of capital (but only by repurchase, redemption,
retirement, repayment, liquidating dividend or liquidating distribution); (d) there
shall not be deducted in respect of any 


 


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Investment
any amounts received as earnings on such Investment, whether as dividends,
interest or otherwise, except that accrued interest included as provided in the
foregoing clause (b) may be deducted when paid; and (e) there shall
not be deducted from the aggregate amount of Investments any decrease in the
value thereof.


 


“Land”
shall mean, the real property located at 100 International Drive, Windsor, Connecticut,
and described in Exhibit “C” to this Agreement.


 


“Lease(s)”
shall mean, leases, licenses and agreements, whether written or oral, relating
to the use or occupation of space in the Improvements or on the Land by Persons
other than the Borrower, and as of the date hereof, it shall mean that certain
Lease between the Borrower and the Primary Tenant dated January 9, 2009
concerning the Mortgaged Premises.


 


“Lender”  shall mean, Berkshire Bank, its successors
and assigns.


 


“LIBOR”
(London Interbank Offered Rate) means the rate for deposits in U.S. Dollars for
a period of the Designated Maturity, which appears on Telerate Page 3750
as of 11:00 AM. London time, on the day that is two London banking days prior
to the Reset Date.  If such rate does not
appear on Telerate Page 3750, the rate for that adjustment date will be
the arithmetic mean of the rates quoted by major banks in London, selected by
the Lender for the Designated Maturity, as of 11:00 A.M., London time, on
the day that is two London banking days prior to the Reset Date.


 


“LIBOR
Interest Rate” means, for the purpose of this Agreement, the 30-day LIBOR Rate
as announced in the Telerate from time-to-time, plus two hundred seventy-five
(275) basis points; provided, however, for the purposes of this Agreement the
30-day LIBOR Rate, plus two hundred seventy-five (275) basis points, shall have
a floor of (and shall never be lower then) 4% during the Interest Only Period
(as defined in the Note).


 


“LIBOR
Loan” means any Loan when and to the extent that the interest rate therefore is
determined by reference to the LIBOR Interest Rate.


 


“Loan
Documents” shall mean, this Agreement, the Construction Note, the Indemnity
Agreement and the Security Documents, and all other agreements, documents and
instruments now or hereafter evidencing, securing or otherwise relating to the
Construction Loan.


 


“London
Banking Day” shall mean any Banking  Day on which
commercial banks are open for international business (including dealing in U.S.
dollar ($) deposits) in London, England and Boston, Massachusetts.


 


“Maturity
Date” shall mean, the earlier of (i) the date of the termination of the
Lender’s obligation to make Advances pursuant to Section 15.02 hereof of (ii) ten
(10)  years from the Closing Date, whichever occurs first.


 


“Mortgage”  shall mean, the Open-End Construction
Mortgage, dated or to be dated on or prior to the Closing Date, made by the
Borrower in favor of the Lender, pursuant to which the Borrower grants a first
mortgage lien and first security interest in and to the Project, such Mortgage
to be in form and substance satisfactory to the Lender.


 


“Mortgaged
Premises” shall mean the Land, Improvements and other property secured by
the Mortgage.


 


“Net
Cash Flow” for each Loan Month shall mean, Net Operating Income, reduced by all
monthly payments of principal and interest under the Construction Note.


 


“Net
Operating Income”  for each Loan Month
shall be calculated by Lender based upon Lender’s review of Borrower’s
financial statements provided to Lender, together with such other financial
information as Lender may request, and shall mean the Gross Revenues for the
Loan Month less all Operating Expenses for the Loan Month.  For the purposes of testing Debt Service
Coverage Ratio for the initial test, annual Net Operating Income shall mean all
in-place Gross Revenues evidenced by a current rent roll (annualized) less
budgeted Operating


 


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Expenses
(budget subject to review and approval by Lender) for the upcoming twelve (12)
month period, adjusted for interest and non-cash expenses.


 


“Obligations”  shall mean, all indebtedness, obligations and
liabilities of the Borrower to the Lender existing on the date of this
Agreement or arising thereafter, direct or indirect, joint or several, absolute
or contingent, matured or unmatured, liquidated or unliquidated, secured or
unsecured, arising by contract, operation of law or otherwise, including,
without limitation, those arising or incurred under this Agreement or any of
the other Loan Documents, including without limitation any SWAP Agreement(s) or
in respect of any of the Advances or the Construction Note or other instruments
at any time evidencing any thereof.


 


“Outstanding”
shall mean, that with respect to the Advances or the Construction Loan, the
aggregate unpaid principal thereof, together with any unpaid and accrued
interest thereon as of any date of determination.


 


“Permitted
Liens”  shall mean, liens, security
interests and other encumbrances, permitted by Section 11.05, as well as
those encumbering the land and Improvements mortgaged to the Lender as
described in Exhibit “D”.


 


“Person”
shall mean, any individual, corporation, partnership, trust, unincorporated
association, business, or other legal entity, and any government or any
governmental agency or political subdivision thereof.


 


“Personal
Property”  shall mean, all materials,
furnishings, fixtures, furniture, machinery, equipment and all items of
tangible personal property now or hereafter owned or acquired by the Borrower,
wherever located, and either (i) to be located on or incorporated into the
Land or the Improvements, (ii) used in connection with the construction of
the Improvements or (iii) to be used in connection with the operation or
maintenance of the Land or the Improvements or both.


 


“Plans
and Specifications”  shall mean, the
plans and specifications for the Improvements prepared by the Borrower’s
Architect and more particularly identified on Exhibit “E” attached
hereto.


 


“Primary
Tenant” means The Tire Rack, Inc.


 


“Project”  shall mean, the Land, Improvements and
Personal Property.


 


“Project
Approvals”  shall mean, all approvals,
consents, waivers, orders, agreements, acknowledgments, authorizations, permits
and licenses required under applicable Requirements or under the terms of any
restriction, covenant or easement affecting the Project, or otherwise necessary
or desirable, for the ownership and acquisition of the Land and the
Improvements, the construction and equipping of the Improvements, and the use,
occupancy and operation of the Project following completion of construction of
the Improvements, whether obtained from a Governmental Authority or any other
Person.


 


“Project
Budget”  shall mean, the budget for total
estimated Project Costs, submitted by the Borrower, approved by the Lender and
the Construction Inspector, and attached hereto as Exhibit “F” (as
amended from time to time with the prior approval of the Lender), which
includes: (a) a line item cost breakdown for Direct Costs by trades, jobs
and subcontractors; (b) a line item cost break down for Indirect Costs; (c) a
construction schedule setting forth the anticipated dates of completion of
incremental portions of the various subcategories of work in the construction
and equipping of the Project; and (d) a schedule of the sources of funds
to pay Project Costs, indicating by item the portion of Project Costs to be
funded through the Construction Loan and Required Equity Funds.


 


“Project
Costs”  shall mean, the sum of all Direct
Costs and Indirect Costs that have been or will be incurred by the Borrower in
connection with the acquisition of the Land, the construction, equipping and
completion of the Improvements, the marketing and leasing of leasable space in
the Improvements, and the operation and carrying of the Project through the
Maturity Date.


 


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“Real
Estate”  shall mean, all real property at
any time owned, leased (as lessee or sublessee) or operated by the Borrower.


 


“Record”  shall mean, the grid attached to the
Construction Note, or the continuation of such grid, or any other similar
record, including computer records, maintained by the Lender with respect to
the Construction Loan.


 


“Release”.  See Section 9.16(c) (iii).


 


“Requirements”
shall mean, any law, ordinance, code, order, rule or regulation of any
Governmental Authority relating in any way to the acquisition and ownership of
the Project, the construction of the Improvements, or the use, occupancy and
operation of the Project following the completion of construction of the
Improvements, including those relating to subdivision control, zoning,
building, use and occupancy, fire prevention, health, safety, sanitation,
handicapped access, historic preservation and protection, tidelands, wetlands,
flood control, access and earth removal, and all Environmental Laws.


 


“Required
Equity Funds” shall mean, with respect to the Construction Loan, Eight Million
Nine Hundred Fifteen Thousand Eight Hundred Ninety One ($8,915,891.00) which
amount shall be infused by Borrower prior to any Advance hereunder.


 


“Retainage”.  See Section 2.03.


 


“Security
Documents” shall mean, the Mortgage,  the
Assignment of Project Documents, the Assignment of Leases, the Financing
Statements and the Guaranty, and any other agreement, document or instrument
now or hereafter securing the Obligations.


 


“Site
Work Contractor” shall mean the Simscroft Echo Farms Incorporated.


 


“Survey”  shall mean, an instrument survey of the Land
and the Improvements prepared in accordance with the Lender’s survey
requirements, such survey to be satisfactory to the Lender in form and
substance.


 


“Surveyor
Certificate”  shall mean, with respect to
any Survey, a certificate executed by the surveyor who prepares such Survey
dated as of a recent date and containing such information relating to the
Project as the Lender or the Title Insurance Company may require, such
certificate to be satisfactory to the Lender in form and substance.


 


“Swap
Agreement” means the ISDA Master Agreement (1992 multicurrency — cross border)
dated as of February 6, 2009 between Lender and Borrower, together with
the Schedule thereto and the Confirmation thereunder, each dated as of February 6,
2009.


 


“Telerate”
means, when used in connection with any designated page and any floating
rate option, the display page so designated on Bridge’s Telerate Service
(or such other page as may replace that page on that service), or
such other service as may be nominated as the information vendor, for the
purpose of displaying rates or prices comparable to that floating rate option.


 


“Taking”
shall mean, any condemnation for public use of, or damage by reason of, the
action of any Governmental Authority, or any transfer by private sale in lieu
thereof, either temporarily or permanently.


 


“Tangible
Net Worth” means as of any date of determination, the net value of the Borrower’s
Stockholder’s Equity, as defined according to GAAP less the book value as of
such date of Intangible Assets.


 


“Termination
Date”  shall mean, (i) the Maturity
Date, or (ii)  the date of the termination of the Lender’s obligations to
make Advances pursuant to Section 15.02 hereof, whichever date occurs
first.


 


“Title
Insurance Company” shall mean, First American Title Insurance Company.


 


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“Title
Policy” shall mean, an ALTA standard form title insurance policy issued by the
Title Insurance Company (with such reinsurance or co-insurance as the Lender
may require, any such reinsurance to be with direct access endorsements) in an
amount not less than Twelve Million and 00/100 Dollars ($12,000,000.00)
insuring the priority of the Mortgage and that the Borrower holds marketable
fee simple title to the Project, subject only to such exceptions as the Lender
may approve and which shall not contain exceptions for mechanics liens, persons
in occupancy or matters which would be shown by a survey, shall not insure over
any matter except to the extent that any such affirmative insurance is
acceptable to the Lender in its sole discretion, and shall contain a pending
disbursements clause or endorsement and such other endorsements and affirmative
insurance as the Lender in its sole discretion may require.


 


1.02        RULES OF
INTERPRETATION.


 


(a) A
reference to any agreement, budget, document or schedule shall include such
agreement, budget, document or schedule as revised, amended, modified or
supplemented from time to time in accordance with its terms and the terms of
this Agreement.


 


(b) The
singular includes the plural and the plural includes the singular.


 


(c) A
reference to any law includes any amendment or modification to such law.


 


(d) A
reference to any Person includes its permitted successors and permitted
assigns.


 


(e) Accounting
terms not otherwise defined herein have the meaning assigned to them by
generally accepted accounting principles applied on a consistent basis by the
accounting entity to which they refer.


 


(f) The
words “include”, “includes” and “including” are not limiting.


 


(g) The
words “approval” and “approved”, as the context so determines, means an
approval in writing given to the party seeking approval after full and fair
disclosure to the party giving approval of all material facts necessary in
order to determine whether approval should be granted.


 


(h) Reference
to a particular Section refers to that section of this Agreement unless
otherwise indicated.


 


(i) The
words “herein”, “hereof”, “hereunder” and words of like import shall refer to
this Agreement as a whole and not to any particular section or subdivision of
this Agreement.


 


2.00        AGREEMENT TO MAKE
ADVANCES; LIMITATIONS.


 


2.01        AGREEMENT TO MAKE ADVANCES.


 


Subject
to the terms and conditions of this Agreement and following the infusion of the
Required Equity Funds from the Borrower into the Project, the Lender agrees to
lend to the Borrower and the Borrower shall borrow from time to time between
the Closing Date and the Termination Date upon submission by the Borrower of a
Draw Request in accordance with Section 3.01, such amounts as are
requested by the Borrower up to a maximum aggregate principal amount equal to
the Construction Loan Amount to pay for Project Costs actually incurred by the
Borrower and reflected in the Project Budget as being funded by the
Construction Loan. Each Draw Request for an Advance hereunder shall constitute
a representation and warranty by the Borrower that the conditions set forth in Section 12.00,
in the case of the initial Advance, and Section 13.00, in the case of all
other Advances, have been satisfied on the date of such Draw Request.


 


2.02        PROJECT BUDGET.


 


The
Project Budget reflects, by category and line items, the purposes and the
amounts for which funds to be Advanced by the Lender under this Agreement are
to be used. The Lender shall not be required to disburse for any 


 


9

















 


category
or line item more than the amount specified therefore in the Project Budget,
unless reflected on a revised Project budget previously approved by Lender.


 


2.03  AMOUNT OF ADVANCES.


 


In
no event shall the Lender be obligated to Advance more than the Construction
Loan Amount, or, if less, total Project Costs actually incurred by the
Borrower, less, in either case, the Required Equity Funds. In no event shall
any Advance for Direct Costs of constructing the Improvements exceed an amount
equal to (a) the total value of the labor, materials, fixtures, machinery
and equipment completed, approved and incorporated into the Land or the
Improvements prior to the date of the Draw Request for such Advance, less (b) retainage
in an amount equal to five percent (5%) of such total value (“Retainage”), less
(c) the total amount of any Advances previously made by the Lender for
such Direct Costs. Retainage shall not be required to be Advanced by the Lender
to the Borrower.    With respect to any
other Direct Costs and all Indirect Costs, in no event shall any Advance exceed
an amount equal to the amount of such Direct Costs and Indirect Costs approved
by the Lender, incurred by the Borrower prior to the date of the Draw Request
for such Advances, and theretofore paid or to be paid with the proceeds of such
Advance, less the total amount of any Advances previously made by the Lender
for such Direct Costs and Indirect Costs.


 


2.04 QUALITY OF WORK.


 


No
Advance shall be due unless all work done at the date the Draw Request for such
Advance is submitted is done in a good and workmanlike manner and without
defects, as confirmed by the report of the Construction Inspector.


 


2.05 COST OVERRUNS AND SAVINGS.


 


If
the Borrower becomes aware of any change in Project Costs which will increase
or decrease a category or line item of Project Costs reflected on the Project
Budget (as the Project Budget is revised from time to time and approved by the
Lender), the Borrower shall immediately notify the Lender in writing and
promptly submit to the Lender for its approval a revised Project Budget. If the
revised Project Budget indicates an increase in a category or line item of
Project Costs, no further Advances need be made by the Lender unless and until (a) the
revised Project Budget so submitted by the Borrower is approved by the Lender,
and (b) the Borrower has deposited with the Lender any additional Required
Equity Funds required in accordance with this Agreement (if any). If the
revised Project Budget indicates a decrease in a category or line item of
Project Costs, no reductions in Project Costs will be made or savings
reallocated by the Borrower unless and until (a) the revised Project
Budget so submitted by the Borrower is approved by the Lender, and (b) in
the case of decreases in a category or line item of Direct Costs, the Borrower
has furnished the Lender and the Construction Inspector with evidence
satisfactory to them that the labor performed and materials supplied in
connection with such category or line item of Direct Costs have been
satisfactorily completed in accordance with the Plans and Specifications and
paid for in full.


 


2.06 CONTINGENCY RESERVE


 


The
amount allocated as Contingency Reserve in the Project Budget is not intended
to be disbursed and will only be disbursed upon the prior approval of the
Lender, which approval will not be unreasonably withheld. The disbursement of a
portion of Contingency Reserve shall in no way prejudice the Lender from
withholding disbursement of any further portion of Contingency Reserve.


 


2.07 OVER ADVANCES


 


The
making of loans, Advances or credits by the Lender in excess of the
Construction Loan Amount is for the benefit of the Borrower hereunder and shall
be at the Lender’s sole discretion. Such loans, Advances, and credits shall
constitute Advances and shall be repayable with interest as provided in the
Construction Note. The making of any such loans, Advances or credits in excess
of the Construction Loan Amount on any one occasion shall not obligate the
Lender to make any such loans, Advances or credits on any other occasion nor
permit such loans, Advances or credits to remain outstanding.


 


10
















 


2.08  MANDATORY BORROWING


 


Subject
to Section 10.14, notwithstanding anything to the contrary contained
herein, and provided that the Lender has not commenced exercise of its
cumulative rights and remedies following an Event of Default, the Borrower must
borrow the Twelve Million and 00/100 Dollars ($12,000,000.00) on or before the
last day of the Interest Only Period (defined in the Construction Note).  In the event that the Borrower completes
construction for less than the Project Budget, it is still required to draw
down the unused portion of the Loan which shall be held in an interest bearing
cash collateral account with the Lender (the “Reserve Account”).  The Borrower, provided no Event of Default
has occurred, may use the Reserve Account following the first anniversary of
the date hereof, to pay its monthly principal obligations to the Lender under
the Construction Note.


 


2.09  FUNDS DEPOSITED WITH LENDER


 


All
funds of Borrower which are deposited with Lender pursuant to this Agreement or
any other Loan Documents shall be held in an interest bearing account and all
funds which are deposited in the Reserve Account may be co-mingled with Lender’s
general funds.  Notwithstanding any
information or requirement to the contrary set forth earlier in this Agreement,
any interest which accrues on said funds shall, at Lender’s sole option, be
paid to Borrower or be held as part of the applicable funds being held by
Lender for the same purpose for which the principal sum of said funds are being
held by the Lender.  To secure all of
Borrower’s Obligations to Lender under the Loan Documents, Borrower hereby
grants to Lender a security interest in all funds now or hereafter deposited
with the Lender in the Reserve Account or otherwise in Lender’s possession,
custody or control pursuant to the provisions of this Agreement.  So long as any Event of Default exists,
Lender shall have such rights with respect to such funds and any interest
accrued thereon as are provided by applicable law and may apply such funds
toward the satisfaction of Borrower’s Obligations hereunder or under any other
Loan Documents in Lender’s sole discretion. 
Without limiting any of the foregoing provisions, at the exclusive
request of Lender, Borrower shall execute and deliver from time-to-time such
documents as may be necessary or appropriate, in Lender’s sole discretion to
assure Lender that it has a first priority perfected security interest in and
lien on, all funds deposited in the Reserve Account or otherwise with the
Lender.


 


3.00  MAKING THE ADVANCES


 


3.01 DRAW REQUEST


 


At
such time as the Borrower shall desire to obtain an Advance, the Borrower shall
complete, execute and deliver to the Lender the Borrower’s Requisition and the
Funding Request Documents in the form of Exhibit “G”  attached hereto (hereinafter referred to as “Borrower’s
Requisition”). Each Borrower’s Requisition shall be accompanied by:


 


(a) If
the Borrower’s Requisition includes payments for Direct Costs, it shall be
accompanied by a completed and itemized Direct Cost Statement in the form of Schedule
I of Exhibit “G” attached hereto, executed by the
Borrower,  together with invoices for all
items of Direct Cost covered thereby; .


 


(b) If
the Borrower’s Requisition includes amounts to be paid to the Contractor under
the Construction Contract, it shall be accompanied by: (i) a completed and
fully itemized Application and Certificate for Payment (AIA Document G702 or
similar form approved by the Lender) containing the certification of the
Contractor and the Borrower’s Architect as to the accuracy of same, and showing
all subcontractors and materialmen by name and trade or job, the total amount
of each subcontract or purchase order, the amount theretofore paid to each
subcontractor or materialman as of the date of such application, and the amount
to be paid from the proceeds of the Advance to each subcontractor and
materialman; (ii) a certificate of the Contractor in the form of Exhibit “H”
attached hereto; (iii) a certificate of the Borrower’s Architect in the
form of Exhibit “I”  attached
hereto; and (iv) copies of requisitions and invoices from subcontractors
and materialmen supporting all items of cost covered by such application;


 


11

















 


(c) If
the Borrower’s Requisition includes payments for Indirect Costs, it shall be
accompanied by a completed and itemized Indirect Cost Statement in the form of Schedule
II of Exhibit “G” attached hereto, executed by the Borrower,
together with invoices for all items of Indirect Costs covered thereby;


 


(d) written
lien waivers from the Contractor and such laborers, subcontractors and
materialmen for work done and materials supplied by them which were paid for
pursuant to the next preceding Draw Request;


 


(e) a
written request of the Borrower for any necessary changes in the Plans and
Specifications, the Project Budget, the Disbursement Schedule or the
Construction Schedule;


 


(f) copies
of all change orders and construction change directives, accompanied by a
change order summary prepared by and executed by the Borrower, copies of all
subcontracts, and, to the extent requested by the Lender, of all inspection or
test reports and other documents relating to the construction of the
Improvements, not previously delivered to the Lender;


 


(g) copy
of the Construction Inspection Report; and


 


(h) such
other information, documentation and certification as the Lender shall
reasonably request.


 


3.02 NOTICE AND FREQUENCY OF ADVANCES


 


Each
Draw Request shall be submitted to the Lender at least fourteen (14) Business
Days prior to the date of the requested Advance, and no more frequently than
once each month.


 


3.03 DEPOSIT OF FUNDS ADVANCED


 


The
Borrower shall open and maintain a non-interest bearing Construction Loan
checking account with the Lender (the “Construction Loan Checking Account”).
Except as otherwise provided for in Sections 3.04 and 3.05 hereof, the Lender
shall deposit the proceeds of each Advance into the Construction Loan Checking
Account.


 


3.04  ADVANCES TO CONTRACTOR


 


In
its sole discretion, following an Event of Default, the Lender may make any or
all Advances through the Title Insurance Company and any portion of the
Construction Loan so disbursed by the Lender shall be deemed disbursed as of
the date on which the Lender makes such disbursement.  At its option, in its sole discretion, the
Lender may make any or all Advances for Direct Costs incurred under the
Construction Contract directly to Contractor for deposit in an appropriately
designated special bank account, and the execution of this Agreement by the
Borrower shall, and hereby does, constitute an irrevocable authorization so to
advance the proceeds of the Construction Loan. No further authorization from
the Borrower shall be necessary to warrant such direct advances to the
Contractor and all such advances shall satisfy pro tanto the obligations of the
Lender hereunder and shall be secured by the Mortgage and the other Security
Documents as fully as if made directly to the Borrower.


 


3.05 ADVANCES TO TITLE INSURANCE COMPANY OR TO OTHERS


 


In
its sole discretion, following an Event of Default, the Lender may make any or
all Advances through the Title Insurance Company and any portion of the
Construction Loan so disbursed by the Lender shall be deemed disbursed as of
the date on which the Lender makes such disbursement.  At its option, the Lender may make Advances
of portions of the proceeds of the Construction Loan to any Person to whom the
Lender in good faith determines payment is due and any portion of the
Construction Loan so disbursed by the Lender shall be deemed disbursed as of
the date on which the Lender makes such disbursement.  The execution of this Agreement by the
Borrower shall, and hereby does, constitute an irrevocable authorization so to
advance the proceeds of the Construction Loan. No further authorization from
the Borrower shall be necessary to warrant such direct Advances and all such
Advances shall satisfy pro tanto the obligations of the Lender hereunder and
shall be secured by the Mortgage and the other Security Documents as fully as
if made directly to the Borrower.


 


12

















 


3.06 ADVANCES DO NOT CONSTITUTE A WAIVER


 


No
Advance made by the Lender shall constitute a waiver of any of the conditions
to the Lender’s obligation to make further Advances nor, in the event the
Borrower fails to satisfy any such condition, shall any such Advance have the
effect of precluding the Lender from thereafter declaring such failure to
satisfy a condition to be an Event of Default.


 


4.00  THE CONSTRUCTION NOTE;
INTEREST; MATURITY; SWAP AGREEMENT; PAYMENTS AND PREPAYMENT.


 


4.01  THE CONSTRUCTION NOTE


 


The
obligation of the Borrower to pay the Construction Loan Amount or, if less, the
aggregate unpaid principal amount of all Advances made by the Lender hereunder
plus accrued interest thereon, shall be evidenced by the Construction Note, a
copy of which is annexed hereto as Exhibit “J”.  In the event the Construction Note is lost,
destroyed or mutilated at any time prior to payment in full of the indebtedness
evidenced thereby, the Borrower shall execute a new note substantially in the
form of the Note. The Construction Note shall not be necessary to establish the
indebtedness of the Borrower to the Lender on account of Advances made under
this Agreement.


 


4.02  [RESERVED]


 


4.03        SWAP AGREEMENT


 


Borrower
shall enter into the Swap Agreement with Lender or its affiliates with respect
to all of the Construction Note (any such agreement or arrangement shall be in
form and substance reasonably satisfactory to Lender) in order to hedge or
minimize risk with respect to the fluctuation of interest rates.  The Swap Agreement shall be for a stipulated
term equal to the term of the Note shall, at all times, be in a notional amount
equal to Twelve Million and 00/100 Dollars ($12,000,000.00).  If the Swap Agreement shall expire and leave
any principal of the Construction Note uncovered thereby, or if for any other
reason any principal portion of the Construction Note be uncovered by the Swap
Agreement, such uncovered amount shall be immediately due and payable if the
Borrower is unable to negotiate a new Swap Agreement for such uncovered amount
with Lender within four (4) business days following notice from Lender to
Borrower.  In the event Lender no longer
offers Swap Agreements, Borrower may negotiate a new Swap Agreement with a
different lender for such uncovered amount. 
The Swap Agreement is subject to termination pursuant to certain
provisions described therein, including without limitation, any payment of
principal of the Construction Note prior to the due date of such payment.


 


4.04 THE RECORD


 


The
Borrower irrevocably authorizes the Lender to make or cause to be made, at or
about the time of the Drawdown Date of any Advance or at the time of receipt of
any payment of the principal of the Construction Note, an appropriate notation
on the Lender’s Record reflecting the making of such Advance or (as the case
may be) the receipt of such payment. The outstanding amount of the Construction
Loan set forth on the Lender’s Record shall be prima facie evidence of the
principal amount thereof owing and unpaid to the Lender, but the failure to
record, or any error in so recording, any such amount on the Lender’s Record
shall not limit or otherwise affect the obligations of the Borrower here under
or under the Note to make payments of principal or interest on the Construction
Note when due.


 


13

















 


4.05 INTEREST ON ADVANCES


 


Each
Advance shall bear interest for the period commencing on the Drawdown Date of
such Advance until paid in full at the rate or rates set forth in the
Construction Note. The Borrower promises to pay interest on each Advance in
arrears in the manner and at the time set forth in the Construction Note.


 


4.06  CALCULATION AND PAYMENT
OF INTEREST


 


Interest
on each LIBOR Loan shall be calculated on the basis of a year of 360 days for
the actual number of days elapsed for the applicable interest period.


 


Interest
on the Loans shall be paid in immediately available funds at the Principal
Office of the Lender.  Interest shall be
calculated daily and payable monthly, in arrears, in accordance with the terms
of the Construction Note.


 


4.07  PRINCIPAL PAYMENTS


 


Principal
payments shall be made in accordance with the Construction Note.   All unpaid principal and all unpaid and accrued
interest thereon shall be due and payable, in full on the Maturity Date.


 


4.08 MATURITY


 


The
Borrower promises to pay the Lender on the Maturity Date, and there shall
become absolutely due and payable on the Maturity Date, all of the unpaid
principal on the Construction Loan outstanding on such date together with any and
all accrued and unpaid interest thereon.


 


4.09  FUNDING LOSS
INDEMNIFICATION


 


The Borrower shall also pay to the Lender, upon the request of the
Lender, such amount or amounts as shall be sufficient (in the reasonable
opinion of the Lender) to compensate it for any loss, cost, or expense
(including the then present value of any lost interest earnings as a result of
any re-deployment of prepaid funds) incurred as a result of any payment of a
LIBOR Loan on a date other than a scheduled principal payment day or the last
day of the interest period for such Loan including, but not limited to,
acceleration of the Loans by the Lender pursuant to Section 15.00


 


Upon
request, Lender will provide Borrower with reasonable documentation of the
calculation of compensation requested and relating hereto.


 


4.10  PREPAYMENT PREMIUM


 


The
Borrower may prepay the Construction Note in whole or in part with accrued
interest from the date of such prepayment on the amount prepaid provided that
it pays any termination or adjustment or other breakage fees or costs pursuant
to the Swap Agreement as well as any other costs and expenses required under
this Agreement including without limitation those described in section 4.09.


 


5.00        [RESERVED]


 


6.00        LOAN FEES; PAYMENTS
AND COMPUTATIONS; CAPITAL ADEQUACY, ETC.


 


6.01        LOAN FEE


 


The
Borrower agrees to pay to the Lender on or before the Closing Date of the
Construction Loan a loan commitment fee in the amount of $60,000.


 


14

















 


6.02        FUNDS FOR PAYMENT


 


(a) All
payments of principal, interest, fees and any other amounts due under the
Construction Note or under any of the other Loan Document shall be made to the
Lender at its Head Office or at such other location that the Lender may from
time to time designate, in each case not later than 2:00 p.m. (Boston
time) on the date when due in immediately available funds in lawful money of
the United States.


 


(b) All
payments by the Borrower under the Construction Note and under any of the other
Loan Documents shall be made without setoff or counterclaim and free and clear
of and without deduction for any taxes, levies, imposts, duties, charges, fees,
deductions, withholdings, compulsory loans, restrictions or conditions of any
nature now or hereafter imposed or levied by any jurisdiction or any political
subdivision thereof or taxing or other authority therein unless the Borrower is
compelled by law to make such deduction or withholding. If any such obligation
to deduct or withhold is imposed upon the Borrower with respect to any amount
payable by it under the Construction Note or under any of the other Loan
Documents, the Borrower will pay to the Lender, on the date on which such
amount is due and payable under the Construction Note or under such other Loan
Document, such additional amount as shall be necessary to enable the Lender to
receive the same amount which the Lender would have received on such due date
had no such obligation been imposed upon the Borrower. The Borrower will
deliver promptly to the Lender certificates or other valid vouchers for all
taxes or other charges deducted from or paid with respect to payments made by
the Borrower under the Construction Note or under such other Loan Document.


 


6.03 COMPUTATIONS


 


Except
as otherwise provided in this Agreement, the Construction Note, whenever a
payment thereunder or under any of the other Loan Documents becomes due on a
day that is not a Business Day, the due date for such payment shall be extended
to the next succeeding Business Day, and interest shall accrue during such
extension. The outstanding amount of the Construction Loan as reflected on the
Record from time to time shall be considered correct and binding on the
Borrower unless within ten (10) Business Days after receipt of any notice
by the Borrower of such outstanding amount, the Borrower shall notify the
Lender to the contrary.


 


6.04 ILLEGALITY


 


Notwithstanding
any other provision in this Agreement, if the Lender determines that any
applicable law, rule, or regulation, or any change therein, or any change in
the interpretation or administration thereof by any governmental authority,
central bank, or comparable agency charged with the interpretation or
administration thereof, or compliance by the Lender (or its Lending Office)
with any request or directive (whether or not having the force of law) of any
such authority, central bank, or comparable agency shall make it unlawful or
impossible for the Lender (or its Lending Office) to (1) maintain the
Construction Loan, then upon notice to the Borrower by the Lender the
Construction Loan shall terminate; or (2) maintain or fund LIBOR Loans,
then upon notice to the Borrower by the Lender the outstanding principal amount
of the LIBOR Loans, together with interest accrued thereon, and any other
amounts payable to the Lender under this Agreement shall be repaid or converted
to a prime Loan at the option of the Borrower (a) immediately upon demand
of the Lender if such change or compliance with such request, in the judgment
of the Lender, requires immediate repayment; or (b) at the expiration of
the last Interest Period to expire before the effective date of any such change
or request.


 


6.05 DISASTER


 


Notwithstanding
anything to the contrary herein, if the Lender determines (which determination
shall be conclusive) that quotations of interest rates for the relevant
deposits referred to in the definition of LIBOR is not being provided in the relevant
amounts or for the relative maturities for purposes of determining the rate of
interest on LIBOR Loan as provided in this Agreement then the Lender shall
forthwith give notice thereof to the Borrower, whereupon (a) the
obligation of the Lender to make LIBOR Loans shall be suspended until the
Lender notifies the Borrower that the circumstances giving rise to such
suspension no longer exist; and (b) the Borrower shall repay in full, or
convert to a Loan with a comparable rate of interest, in full, the then outstanding
principal amount of the Loan, together with accrued interest thereon.


 


15

















 


6.06  ADDITIONAL PAYMENTS


 


If
after the date of this Agreement the Lender determines that (i) the
adoption of or change in any law, rule, regulation or guideline regarding
capital requirements for banks or bank holding companies, or any change in the
interpretation or application thereof by any governmental authority charged
with the administration thereof, or (ii) as a result from any change after
the date of this Agreement in United States, Federal, State, Municipal or
Foreign Laws or Regulations (whether or not having the force of law) by any
court or governmental or monetary authority charged with the interpretation or
administration thereof which changes the basis of taxation of any amounts
payable to the Lender under this Agreement, including the Construction
Loan,  (other than taxes imposed on the
overall net income of the Lender for any of such loans by the jurisdiction
where the principal office of the Lender is located), then the Lender shall
notify the Borrower thereof.  The
Borrower agrees to pay to the Lender the amount of such reduction in the return
on capital as and when such reduction is determined, upon presentation by the
Lender of a statement in the amount and setting forth the Lender’s calculation
thereof, which statement shall be deemed true and correct absent manifest
error.  In determining such amount, the
Lender may use reasonable averaging and attribution methods.


 


7.00  COLLATERAL SECURITY AND
GUARANTY


 


7.01 MORTGAGE LIEN


 


The
Obligations shall be secured by, inter  alia,  (i) a perfected first priority mortgage
lien on the Project, (ii) a perfected first absolute assignment of rentals
and leases concerning the Project, and (iii) a first perfected priority security
interest in all Collateral, whether now owned or hereafter acquired, pursuant
to the terms of Section 14.00 of this Agreement and the Security Documents
to which the Borrower is a party.  The
Obligations shall also be guaranteed pursuant to the terms of the
Guaranty.  This security interest is in
addition to, and not in substitution of, a security interest of even date
granted from Borrower to Lender, pursuant to an Open-End Construction Mortgage and
the definition of “Collateral” therein shall be incorporated herein by
reference as if originally stated herein. 
Any conflict between this Agreement and the Mortgage and Security
Agreement shall be resolved in each instance, in the sole discretion of the
Lender.


 


7.02        CONTROL


 


Borrower
will cooperate with Lender, and execute agreements required by Lender, in
obtaining control with respect to Collateral consisting of:


 


(i) deposit
accounts;


 


(ii) 
investment property;


 


(iii) 
letter of credit rights; and


 


(iv) 
electronic and chattel paper.


 


The
Borrower grants Lender a limited power of attorney to enter into a Control
Agreement on behalf of the Borrower to effectuate the forgoing.


 


Borrower
will not create any chattel paper without placing a legend on the chattel paper
acceptable to Lender, indicating that Lender has a security interest in the
chattel paper.


 


7.03  CROSS DEFAULT


 


A
default of any of the terms and conditions of any Obligation, of the Borrower
and/or Guarantor to the Lender (including, without limitation any reimbursement
obligations arising out of any Letters of Credit which the Lender may later
issue on behalf of the Borrower and/or Guarantor) or any document or instrument
evidencing such an obligation, shall constitute a default of the Construction
Note, this Agreement, and all Obligations of the Borrower and Guarantor to the
Lender whether evidenced by notes or otherwise.


 


16

















 


8.00 CERTAIN RIGHTS OF LENDER


 


8.01  RIGHT TO RETAIN THE
CONSTRUCTION INSPECTOR


 


The
Lender shall have the right to retain, at the Borrower’s cost and expense, the
Construction Inspector to perform the following services on behalf of the
Lender:


 


(a) to
review and advise the Lender whether in the opinion of the Construction
Inspector, the Project Budget accurately reflects all Project Costs;


 


(b) to
review and advise the Lender whether, in the opinion of the Construction
Inspector, the Plans and Specifications are satisfactory for the intended
purposes thereof;


 


(c) to
make periodic inspections (approximately at the date of each Draw Request) for
the purpose of assuring that construction of the Improvements to date is in
accordance with the Plans and Specifications and to approve the Borrower’s then
current Draw Request as being consistent with the Project Budget and the
Borrower’s obligations under this Agreement, and to advise the Lender of the
anticipated cost of and time for completion of construction of the Improvements
and the adequacy of any Contingency Reserve;


 


(d) to
review and advise the Lender on any proposed change orders or construction
change directives; and


 


(e) to
review the Construction Contract and subcontracts, for the purpose of providing
the Lender with an opinion as to the cost of construction to be incurred to
complete the Project, and also for the purpose of assuring that all such
subcontracts are for work required by the Plans and Specifications to be
performed.


 


The
fees of the Construction Inspector shall be paid by the Borrower forthwith upon
billing therefore and expenses incurred by the Lender on account thereof shall
be reimbursed to the Lender forthwith upon request therefore, but neither the
Lender nor the Construction Inspector shall have any liability to the Borrower
on account of (i) the services performed by the Construction Inspector, (ii) any
neglect or failure on the part of the Construction Inspector to properly
perform its services, or (iii) any approval by the Construction Inspector
of construction of the Improvements. Neither the Lender nor the Construction
Inspector assumes any obligation to the Borrower or any other Person concerning
the quality of construction of the Improvements or the absence therefrom of
defects.


 


8.02  APPRAISAL


 


At
any time during the term of the Loan, Borrower shall cooperate with Lender and
use reasonable efforts to assist Lender in obtaining an appraisal of the
Mortgaged Premises.  Such cooperation and
assistance from Borrower shall include but not be limited to the obligation to
provide Lender or Lender’s appraiser with the following: (i) reasonable
access to the Mortgaged Premises, (ii) a current certified rent roll for
the Mortgaged Premises in form and substance satisfactory to Lender, including
current asking rents and a history of change in asking rents and historical
vacancy for the past three years, (iii) current and budgeted income and
expense statements for the prior three years, (iv) a site plan and survey
of Mortgaged Premises and the Building, (v) the building plans and
specifications, including typical elevation and floor plans, (vi) a
photocopy of the transfer documents conveying the beneficial interest in the
Mortgaged Premises to Borrower, together with the legal description of the
Mortgaged Premises, (vii) the current and prior year real estate tax
bills, (viii) a detailed list of past and scheduled capital improvements
and the costs thereof, (ix) a summary of the then current ownership
entity, (x) all environmental reports and other applicable information
relating to the Mortgaged Premises and the Building, and (xi) copies of
all recent appraisals/property description information or brochures, including
descriptions of amenities and services relating to the Mortgaged Premises and
the Building.  The appraiser performing
any such appraisal shall be engaged by Lender, and Borrower shall be
responsible for any fees payable to said appraiser in connection with an
appraisal of the Mortgaged Premises; provided, however, so long as no Event of
Default exists, Borrower shall not be required to pay for more than one
appraisal during the initial thirty-six (36) months hereof.


 


17

















 


8.03 CHARGES AGAINST CONSTRUCTION LOAN CHECKING ACCOUNT


 


The
Lender shall have the right, and the Borrower hereby irrevocably authorizes the
Lender, to charge any account of the Borrower with the Lender, including the
Construction Loan Checking Account referred to in Section 3.03 hereof,
without the further approval of the Borrower, for (i) any installment of
principal or interest due under the Construction Note, (ii) after the
Borrower has been given notice thereof (provided, that no such notice need be
given if there has occurred a Default or Event of Default), any costs or
expenses incurred by the Lender which are to be paid or reimbursed by the
Borrower under the terms of this Agreement or any of the other Loan Documents
(including, without limiting the generality of the foregoing, all Construction
Inspector, Appraisal and reasonable attorney’s fees) or (iii) after the
Borrower has been given notice thereof (provided, that no such notice need be
given if there has occurred a Default or Event of Default), any other sums due
to the Lender under the Construction Note, this Agreement or any of the other
Loan Documents, all to the extent that the same are not paid by the respective
due dates thereof. The Borrower agrees that at all times, the unadvanced
portion of the Construction Loan, together with the collected balance in the
Construction Loan Checking Account shall not be less than the total remaining
Project Costs, exclusive of change orders which have been paid for by the
Primary Tenant within fifteen (15) days of the date of the Change Order, which
monies shall be deposited in the Construction Loan account and if such negative
balance exists, Borrower shall immediately deposit “good funds” into the
Construction Loan Checking Account to remedy the negative balance.


 


9.00 REPRESENTATIONS AND WARRANTIES


 


The
Borrower represents and warrants to the Lender as follows with respect to
Sections 9.01 — 9.41.  The Guarantor
represents and warrants to the Lender, Sections 9.01, 9.03 and 9.04:


 


9.01 ORGANIZATION, AUTHORITY, ETC.


 


(a) Organization;
Good Standing. The Borrower is a limited liability company duly organized
pursuant to the Articles of Organization dated October 20, 2008  and filed with the Connecticut Secretary of
State on October 20, 2008, and is validly existing and in good standing
under the laws of the State of Connecticut. The Borrower, (i) has all
requisite power to own its property and conduct its business as now conducted
and as presently contemplated, and (ii) is in good standing and is duly
authorized to do business in the jurisdiction where the Land is located and in
each other jurisdiction where such qualification is necessary.


 


The
Guarantor is a corporation duly organized pursuant to the Articles of
Organization dated March 10, 1970 and filed with the Delaware Secretary of
State on March 10, 1970 and is validly existing and in good standing under
the laws of the State of Delaware. The Guarantor, (i) has all requisite
power to own its property and conduct its business as now conducted and as
presently contemplated, and (ii) is in good standing and is duly
authorized to do business in the jurisdiction where the Land is located and in
each other jurisdiction where such qualification is necessary.


 


(b) Authorization.
The execution, delivery and performance of this Agreement and the other Loan
Documents to which the Borrower or the Guarantor is or is to become a party and
the transaction contemplated hereby and thereby (i) are within the
authority of such Person, (ii) have been duly authorized by all necessary
proceedings on the part of such Person, (iii) do not conflict with or
result in any breach or contravention of any provision of law, statute, rule or
regulation to which such Person is subject or any judgment, order, writ,
injunction, license or permit applicable to such Person, (iv) do not
conflict with any provision of any operating agreement and articles of organization,
or any agreement or other instrument binding upon, such Person, and (v) do
not require the approval or consent of, or filing with, any governmental agency
or authority other than those already obtained and the filing of the Mortgage,
the Assignment of Leases and the Financing Statements in the appropriate public
records with respect thereto.


 


(c) Enforceability.
The execution and delivery of this Agreement and the other Loan Documents to
which the Borrower or the Guarantor is or is to become a party will result in
valid and legally binding obligations of such Person enforceable against it in
accordance with the respective terms and provisions hereof and thereof, except
as enforceability is limited by bankruptcy, insolvency, reorganization,
moratorium or other laws relating to or 


 


18

















 


affecting
generally the enforcement of creditors’ rights and except to the extent that
availability of the remedy of specific performance or injunctive relief is
subject to the discretion of the court before which any proceeding therefore
may be brought.


 


9.02 TITLE TO PROJECT AND OTHER PROPERTIES


 


Excluding
the Permitted Liens:


 


(a) The
Borrower holds good clear record and marketable fee simple absolute title to
the Land and the Improvements, and owns the Personal Property, subject to no
rights of others, including any mortgages, leases, conditional sale agreements,
title retention agreements, liens or other encumbrances.


 


(b) The
Borrower owns all of the assets reflected in any financial statements provided
to Lender as at the Balance Sheet Date or acquired since that date (except
property and assets sold or otherwise disposed of in the ordinary course of
business since that date), subject to no rights of others, including any
mortgages, leases, conditional sales agreements, title retention agreements,
liens or other encumbrances except Permitted Liens.


 


9.03 FINANCIAL STATEMENTS


 


There
has been furnished to the Lender financial information of the Borrower and
Guarantor in connection with the application for the Loan (the “Financial
Information”). Such Financial Information, to the best of Borrower’s knowledge,
has been prepared in accordance with generally accepted accounting principles
and fairly present the financial condition of the Guarantor as at the close of
business on the date thereof and the results of operations for the fiscal year
then ended.


 


9.04  NO MATERIAL CHANGES, ETC.


 


Since
the date of the Financial Information, there has occurred no material adverse
change in the financial condition or business of the Guarantor other than
changes in the ordinary course of business that have not had any material
adverse effect either individually or in the aggregate on the business or
financial condition of the Guarantor.


 


9.05  INTELLECTUAL PROPERTY


 


Borrower
owns or has a valid right to use all patents, copyrights, trademarks, licenses,
trade names or franchises now being used or necessary to conduct its business,
all of which are listed on Exhibit “K”, hereto and the conduct of
its business as now operated does not conflict with valid patents, copyrights,
trademarks, licenses, trade names or franchises of others in any manner that
could materially adversely affect in any manner the business or assets or
condition, financial or otherwise, of Borrower. 
True and complete copies of each license and franchise agreement, and
evidence of all patents, copyrights, trademarks and trade names, have
previously been delivered to the Lender.


 


9.06 LITIGATION


 


There
are no actions, suits, proceedings or investigations of any kind pending or
threatened against the Borrower before any court, tribunal or administrative
agency or board that, if adversely determined, might, either in any case or in
the aggregate, adversely affect the properties, assets, financial condition or
business of such Person or materially impair the right of such Person to carry
on business substantially as now conducted by it, or result in any liability
not adequately covered by insurance, or for which adequate reserves are not
maintained on the balance sheet of such Person, or which question the validity
of this Agreement or any of the other Loan Documents, any action taken or to be
taken pursuant hereto or thereto, or any lien or security interest created or
intended to be created pursuant hereto or thereto, or which will adversely
affect the ability of the Borrower to construct, use and occupy the
Improvements or to pay and perform the Obligations in the manner contemplated
by this Agreement and the other Loan Documents.


 


19

















 


9.07 NO MATERIALLY ADVERSE CONTRACTS, ETC.


 


The
Borrower is not subject to any charter, corporate or other legal restriction,
or any judgment, decree, order, rule or regulation that has or is expected
in the future to have a materially adverse effect on the business, assets or
financial condition of the Borrower. The Borrower is not a party to any
contract or agreement that has or is expected, in the judgment of the Borrower’s
officers, to have any materially adverse effect on the business of the
Borrower.


 


9.08 COMPLIANCE WITH OTHER INSTRUMENTS


 


The
Borrower is not in violation of any provision of its Certificate of Organization
or Operating Agreement or any agreement or instrument to which it may be subject
or by which it or any of its properties may be bound or any decree, order,
judgment, statute, license, rule or regulation, in any of the foregoing
cases in a manner that could result in the imposition of penalties or
materially and adversely affect the financial condition, properties or business
of the Borrower


 


9.09 TAX STATUS


 


The
Borrower (a) has made or filed all federal and state income and all other
tax returns, reports and declarations required by any jurisdiction to which it
is subject, (b) has paid all taxes and other governmental assessments and
charges shown or determined to be due on such returns, reports and
declarations, except those being contested in good faith and by appropriate
proceedings. There are no unpaid taxes in any material amount claimed to be due
by the taxing authority of any jurisdiction, and the officers of the Borrower
knows of no basis for any such claim.


 


9.10 NO EVENT OF DEFAULT


 


No
Default or Event of Default has occurred and is continuing.


 


9.11 INVESTMENT COMPANY ACT


 


The
Borrower is not an “investment company”, or an “affiliated company” or a “principal
underwriter” of an “investment company”, as such terms are defined in the
Investment Company Act of 1940.


 


9.12 ABSENCE OF FINANCING STATEMENTS, ETC.


 


There
is no financing statement, security agreement, chattel mortgage, real estate
mortgage or other document filed or recorded with any filing records, registry,
or other public office, that purports to cover, affect or give notice of any
present or possible future lien on, or security interest in, (a) any
Collateral or (b) any other assets or property of the Borrower or any
rights relating thereto, except with respect to Permitted Liens.


 


9.13 SETOFF, ETC.


 


The
Collateral and the Lender’s rights with respect to the Collateral are not
subject to any setoff, claims, withholdings or other defenses. The Borrower is
the owner of the Collateral free from any lien, security interest, encumbrance
and any other claim or demand.


 


9.14 CERTAIN TRANSACTIONS


 


Except
as set forth on Exhibit “L” 
hereto, none of the officers, trustees, directors, partners, members or
employees of the Borrower are presently a party to any transaction with the
Borrower (other than for services as employees, officers and directors),
including any contract, agreement or other arrangement providing for the
furnishing of services to or by, providing for rental of real or personal
property to or from, or otherwise requiring payments to or from any officer,
trustee, director, partner or such employee or, to the knowledge of the
Borrower, any corporation, partnership, trust or other entity in which any
officer, trustee, director, partner, member or any such employee has a
substantial interest or is an officer, director, trustee, member or partner


 


20
















 


9.15.       EMPLOYEE BENEFIT
PLANS MULTI-EMPLOYER PLANS GUARANTEED PENSION PLANS


 


Neither
the Borrower nor any ERISA Affiliate other than the Guarantor, maintains or
contributes to any Employee Benefit Plan, Multi- employer Plan or Guaranteed
Pension Plan.


 


9.16 ENVIRONMENTAL COMPLIANCE


 


The
Borrower has taken all necessary action to investigate the past and present
condition and usage of the Real Estate and the operations conducted thereon
and, based upon such diligent investigation, makes the following representations
and warranties to its knowledge.


 


(a) None
of the Borrower, or any operator of the Real Estate, or any operations thereon,
is in violation, or alleged violation, of any judgment, decree, order, law,
license, rule or regulation pertaining to environmental matters, including
without limitation, those arising under the Resource Conservation and Recovery
Act (“RCRA”), the Comprehensive Environmental Response, Compensation and
Liability Act of 1980 as amended (“CERCLA”), the Superfund Amendments and Reauthorization
Act of 1986 (“SARA”), the Federal Clean Water Act, the Federal Clean Air Act,
the Toxic Substances Control Act or any state or local statute, regulation,
ordinance, order or decree relating to health, safety or the environment
(hereinafter “Environmental Laws”), which violation involves the Land or would
have a material adverse effect on the environment or the business, assets or
financial condition of the Borrower.


 


(b) The
Borrower has not received notice from any third party including, without
limitation any federal, state or local governmental authority, (i) that it
has been identified by the United States Environmental Protection Agency (“EPA”)
as a potentially responsible party under CERCLA with respect to a site listed
on the National Priorities List, 40 C.F.R. Part 300 Appendix B (1986); (ii) that
any hazardous waste, as defined by 42 U.S.C. § 9601(5), any hazardous
substances as defined by 42 U.S.C. § 9601(14), any pollutant or contaminant as
defined by 42 U.S.C.§ 9601(33) or any toxic substances, oil or hazardous
materials as defined by M.G.L. c. .21E, or other chemicals or substances
regulated by any Environmental Laws (“Hazardous Materials”) which it has
generated, transported or disposed of have been found at any site at which a
federal, state or local agency or other third party has conducted or has
ordered that the Borrower or the Guarantor conduct a remedial investigation,
removal or other response action pursuant to any Environmental Laws; or (iii) that
it is or shall be a named party to any claim, action, cause of action,
complaint, or legal or administrative proceeding (in each case, contingent or
otherwise) arising out of any third party’s incurrence of costs, expenses,
losses or damages of any kind whatsoever in connection with the release of
Hazardous Materials.


 


(c) Except
as set forth on Exhibit “M” attached hereto: (i) no portion of
the Real Estate has been used for the handling, processing, storage or disposal
of Hazardous Materials except in accordance with applicable Environmental Laws;
and no underground tank or other underground storage receptacle for Hazardous
Materials is located on any portion of the Real Estate; (ii) in the course
of any activities conducted by the Borrower, or the operators of their
properties, no Hazardous Materials have been generated or are being used on the
Real Estate except in accordance with applicable Environmental Laws; (iii) there
has been no past or present releasing, spilling, leaking, pumping, pouring,
emitting, emptying, discharging, injecting, escaping, disposing or dumping (a “Release”)
or threatened Release of Hazardous Materials on, upon, into or from the Real
Estate, which Release would have a material adverse effect on the value of any
of the Real Estate or adjacent properties or the environment; (iv) to the
best of the Borrower’s knowledge, there have been no Releases on, upon, from or
into any real property in the vicinity of any of the Real Estate which, through
soil or groundwater contamination, may have come to be located on, and which
would have a material adverse effect on the value of, the Real Estate; and (v) any
Hazardous Materials that have been generated on any of the Real Estate have
been transported off-site only by carriers having an identification number
issued by the EPA, treated or disposed of only by treatment or disposal
facilities maintaining valid permits as required under applicable Environmental
Laws, which transporters and facilities have 


 


21

















 


been
and are, to the best of the Borrower’s knowledge, operating in compliance with
such permits and applicable Environmental Laws.


 


(d) Except
as set forth in Exhibit M, none of the Real Estate is or shall be subject
to any applicable environmental clean-up responsibility law or environmental
restrictive transfer law or regulation, by virtue of the transactions set forth
herein and contemplated hereby.


 


9.17 MEMBERS AND MANAGERS


 


The
members and managers of the Borrower are:


 


	
  Members & Managers

  	
   

  	
  Class

  	
   

  	
  Percentage of Ownership

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Griffin Land & Nurseries, Inc.

  	
   

  	
  N/A

  	
   

  	
  100

  	
  %

  



 


In
each case, the named Member/Manager is the Manager for the Class owned.


 


9.18 AVAILABILITY OF UTILITIES


 


All
utility services necessary and sufficient for the construction, development and
operation of the Project for its intended purposes are presently (or will be
prior to the issuance of the final Certificate of Occupancy) available to the
boundaries of the Land through dedicated public rights of way or through
perpetual private easements, approved by the Lender, with respect to which the
Mortgage creates a valid and enforceable first lien, including, but not limited
to, water supply, storm and sanitary sewer, gas, electric and telephone
facilities, and drainage.


 


9.19 ACCESS


 


The
rights of way for all roads necessary for the full utilization of the
Improvements for their intended purposes have either been acquired by the
appropriate Governmental Authority or have been dedicated to public use and
accepted by such Governmental Authority, and all such roads shall have been
completed, or all necessary steps have been taken by the Borrower and such
Governmental Authority to assure the complete construction and installation
thereof prior to the date upon which access to the Project via such roads will
be necessary. All curb cuts, driveways and traffic signals shown on the Plans
and Specifications are existing or have been fully approved by the appropriate
Governmental Authority.


 


9.20 CONDITION OF PROJECT


 


Neither
the Project nor any part thereof is now damaged or injured as result of any
fire, explosion, accident, flood or other casualty or has been the subject of
any Taking, and to the knowledge of the Borrower, no Taking is pending or
contemplated.


 


9.21 COMPLIANCE WITH REQUIREMENTS


 


The
Plans and Specifications and construction of the Improvements pursuant thereto
and the use and occupancy of the Project contemplated thereby comply with all
Requirements.


 


22

















 


9.22 PROJECT APPROVALS


 


Except
as set forth on Exhibit “N” hereto, the Borrower has obtained all
Project Approvals. All Project Approvals obtained by the Borrower are listed
and described on Exhibit “O” 
hereto, have been validly issued and are in full force and effect. The
Borrower has no reason to believe that any of the Project Approvals not
heretofore obtained by the Borrower will not be obtained by the Borrower in the
ordinary course following completion of the construction of the Improvements in
accordance with the Plans and Specifications. No Project Approvals will
terminate, or become void or voidable or terminable, upon any sale, transfer or
other disposition of the Project, including any transfer pursuant to
foreclosure sale under the Mortgage.


 


9.23 CONSTRUCTION CONTRACT


 


The
Construction Contract is in full force and effect and both the Borrower and the
Contractor are in full Compliance with their respective obligations under the
Construction Contract. The work to be performed by the Contractor under the
Construction Contract is the work called for by the Plans and Specifications,
and all work required to complete the Improvements in accordance with the Plans
and Specifications is provided for under the Construction Contract.


 


9.24 ARCHITECT’S CONTRACT


 


The
Architect’s Contract is in full force and effect and both the Borrower and the
Borrower’s Architect are in full Compliance with their respective obligations
under the Architect’s Contract.


 


9.25 OTHER CONTRACTS


 


The
Borrower has made no contract or arrangement of any kind or type whatsoever
(whether oral or written, formal or informal), the performance of which by the
other party thereto could give rise to a lien or encumbrance on the Project.


 


9.26 REAL PROPERTY TAXES; SPECIAL ASSESSMENTS


 


There
are no unpaid or outstanding real estate or other taxes or assessments on or
against the Project or any part thereof which are payable by the Borrower
(except only real estate taxes not yet due and payable). The Borrower has
delivered to the Lender true and correct copies of real estate tax bills for
the Project for the past fiscal tax year. No abatement proceedings are pending
with reference to any real estate taxes assessed against the Project. There are
no betterment assessments or other special assessments presently pending with
respect to any part of the Project, and the Borrower has received no notice of
any such special assessment being contemplated.


 


9.27 VIOLATIONS


 


The
Borrower has received no notices of, or has any knowledge of, any violations of
any applicable Requirements or Project Approvals.


 


9.28 PLANS AND SPECIFICATIONS


 


The
Borrower has furnished the Lender with true and complete sets of the Plans and
Specifications. The Plans and Specifications so furnished to the Lender comply
with all Requirements, all Project Approvals, and all restrictions, covenants
and easements affecting the Project, and have been approved by the Contractor,
the Borrower’s Architect, the Primary Tenant, the Lender, and such Governmental
Authority as is required for construction of the Improvements.


 


9.29 PROJECT BUDGET


 


To
the best of Borrower’s knowledge, the Project Budget accurately reflects all
Project Costs.


 


23

















 


9.30 FEASIBILITY


 


Each
of the Construction Schedule and the Disbursement Schedule is realistic and
feasible, and is accurate to date.


 


9.31 EFFECT ON DRAW REQUEST


 


Each
Draw Request submitted to the Lender as provided in Section 3.01 hereof
shall constitute an affirmation that the representations and warranties
contained in Section 9.00 of this Agreement and in the other Loan
Documents remain true and correct as of the date thereof; and unless the Lender
is notified to the contrary, in writing, prior to the Drawdown Date of the
requested Advance or any portion thereof, shall constitute an affirmation that
the same remain true and correct on the Drawdown Date.


 


9.32 PRINCIPAL DEPOSITORY


 


The
Borrower further agrees that it shall conduct its principal (majority) banking
business with the Lender, including, without limitation, retaining the Lender
as its principal depository savings accounts, checking accounts, general demand
depository accounts, and such other accounts as are utilized by the Borrower
from time-to-time.


 


9.33  FINANCIAL STATEMENTS


 


The
balance sheet of the Guarantor and the related statements of income and
retained earnings and cash flow of the Guarantor for the fiscal year then
ended, and the accompanying footnotes, together with any interim financial
statements of the Guarantor, copies of which have been furnished to the Lender,
are complete and correct and fairly present the financial condition of the
Guarantor as at such dates and the results of the operations of the Guarantor
for the periods covered by such statements, all in accordance with GAAP
consistently applied (subject to year-end adjustments in the case of the
interim financial statements), and there has been no material adverse change in
the condition (financial or otherwise), business, or operations of the
Guarantor since the presentation to the Lender of the most recently dated financial
statements, nor are there any liabilities of the Guarantor , fixed or
contingent, which are material but are not reflected in such financial
statements or in the notes thereto, other than liabilities arising in the
ordinary course of business. No information, exhibit or report furnished by the
Guarantor to the Lender in connection with the negotiation of this Agreement
contained any material misstatement of fact or omitted to state a material fact
or any fact necessary to make the statement contained therein not materially
misleading.


 


9.34  LABOR DISPUTES AND ACTS
OF GOD


 


Neither
the business nor the properties of the Borrower are affected by any fire,
explosion, accident, strike, lockout or other labor dispute, drought, storm,
hail, earthquake, embargo, act of God or of the public enemy, or other casualty
(whether or not covered by insurance), materially and adversely affecting such
business or properties or the operation of the Borrower.


 


9.35  OTHER AGREEMENTS


 


The
Borrower is not a party to any indenture, loan or credit agreement, or to any
lease or other agreement or instrument, or subject to any charter or limited
liability company restriction which could have a material adverse effect on the
business, properties, assets, operations, or conditions, financial or
otherwise, of the Borrower, or the ability of the Borrower to carry out its
obligations under the Loan Documents to which it is a party. The Borrower is
not in default in any material respect in the performance, observance, or
fulfillment of any of the obligations, covenants, or conditions contained in
any agreement or instrument material to its business to which it is a party.


 


9.36  LITIGATION


 


There
is no pending or threatened action or proceeding against or affecting the
Borrower before any court, governmental agency, or arbitrator, which may, in
any one case or in the aggregate, materially adversely affect the 


 


24

















 


financial
condition, operations, properties, or business of the Borrower, or the ability
of the Borrower to perform their obligations under the Loan Documents to which
it is a party.


 


9.37  NO JUDGMENTS


 


The
Borrower has satisfied all judgments, and the Borrower is not in default with
respect to any judgment, writ, injunction, decree, rule or regulation of
any court, arbitrator, or Federal, state, municipal, or other governmental
authority, commission, board, bureau, agency, or instrumentality, domestic or
foreign.


 


9.38  ERISA


 


The
Borrower is to the best of its knowledge in compliance in all material respects
with all applicable provisions of ERISA. 
Neither a Reportable Event nor a Prohibited Transaction has occurred and
is continuing with respect to any Plan; no notice of intent to terminate a Plan
has been filed, nor has any Plan been terminated; no circumstances exist which
constitute grounds entitling the PBGC to institute proceedings to terminate, or
appoint a trustee to administer, a Plan, nor has the PBGC instituted any such
proceedings; the Borrower, nor any Commonly Controlled Entity has completely or
partially withdrawn from a Multiemployer Plan; the Borrower and each Commonly
Controlled Entity have met their minimum funding requirements under ERISA with
respect to all of their Plans and the present value of all vested benefits
under each Plan does not exceed the fair market value of all Plan assets
allocable to such benefits, as determined on the most recent valuation date of
the Plan and in accordance with the provisions of ERISA; and neither the
Borrower, nor any Commonly Controlled Entity has incurred any liability to the
PBGC under ERISA.


 


9.39  DEBT


 


Set
forth in the financial statements referred to in this Agreement, to the extent
required by GAAP, is a complete and correct list of all Debt in respect of
which the Borrower is in any manner directly or contingently obligated; and the
maximum principal or face amounts of the credit in question, which are
outstanding and which can be outstanding, are correctly stated, and all Liens
of any nature given or agreed to be given as security therefore are correctly
described or indicated in such financial statements.   Exhibit “P” correctly lists all
secured and unsecured Debt of the Borrower outstanding as of the date of this
Agreement, and shows, as to each item of Debt listed thereon, the obligor and
obligee, the aggregate principal amount outstanding on the date hereof.


 


9.40 EXECUTIVE AGREEMENTS


 


None
of the executive officers of the Borrower is subject to any agreement in favor
of anyone, other than Borrower, which limits or restricts that person’s right
to engage in the type of business activity conducted or proposed to be
conducted by such Borrower or to use therein any property or confidential
information or which grants to anyone other than the Borrower any rights in any
inventions or other ideas susceptible to legal protection developed or
conceived by any such officer.


 


9.41  FOREIGN ASSET CONTROL
REGULATIONS


 


Neither
the execution of this Agreement nor the use of the proceeds thereof violates
the Trading With the Enemy Act of 1917, as amended, nor any of the Foreign
Assets Control Regulations promulgated thereunder or under the International
Emergency Economic Powers Act or the U.N. Participation Act of 1945.


 


10.00   AFFIRMATIVE COVENANTS
OF THE BORROWER


 


The
Borrower covenants and agrees that, so long as the Construction Loan is
outstanding or the Lender has any obligation to make any Advances:


 


25

















 


10.01 PUNCTUAL PAYMENT


 


The
Borrower will duly and punctually pay or cause to be paid the principal and
interest on the Construction Loan and all other amounts provided for in the
Construction Note, this Agreement and the other Loan Documents to which the
Borrower is a party, all in accordance with the terms of the Construction Note,
this Agreement and such other Loan Documents.


 


10.02 COMMENCEMENT, PURSUIT AND COMPLETION OF CONSTRUCTION


 


The
Borrower will commence construction of the Improvements within ten (10) days
after the Construction Loan Closing Date, will diligently pursue construction
of the Improvements in accordance with the Construction Schedule, and will
complete construction of the Improvements prior to the Completion Date, all in
accordance with the Plans and Specifications, in full compliance with all restrictions,
covenants and easements affecting the Project, all Requirements, and all
Project Approvals, and with all terms and conditions of the Loan Documents,
without deviation from the Plans and Specifications unless the Borrower obtains
the prior approval of the Lender, and the Primary Tenant.  The Borrower will pay all sums and perform
all such acts as may be necessary or appropriate to complete such construction
of the Improvements in accordance with the Plans and Specifications and in full
Compliance with all restrictions, covenants and easements affecting the
Project, all Requirements and all Project Approvals, and with all terms and
conditions of the Loan Documents, all of which shall be accomplished on or
before the Completion Date, free from any liens, claims or assessments (actual
or contingent) asserted against the Project for any material, labor or other
items furnished in connection therewith. The Borrower will furnish evidence of
satisfactory Compliance with this Section 10.02 to the Lender on or before
the Completion Date.


 


10.03 CORRECTION OF DEFECTS


 


The
Borrower will promptly correct or cause to be corrected all defects in the
Improvements or any departure from the Plans and Specifications not previously
approved by the Lender. The Borrower agrees that any Advance made by the
Lender, whether before or after such defects or departures from the Plans and
Specifications are discovered by, or brought to the attention of, the Lender,
shall not constitute a waiver of the Lender’s right to require Compliance with
this Section 10.03.


 


10.04 MAINTENANCE OF OFFICE


 


After
the Completion Dates, the Borrower will maintain its chief executive office in
Bloomfield, Connecticut or at such other place in the United States of America
as the Borrower shall designate upon written notice to the Lender, where
notices, presentations and demands to or upon the Borrower in respect of the
Loan Documents may be given or made.


 


10.05 RECORDS AND ACCOUNTS


 


The
Borrower will (a) keep true and accurate records and books of account in
which full, true and correct entries will be made in accordance with generally
accepted accounting principles and (b) maintain adequate accounts and
reserves for all taxes (including income taxes), depreciation and amortization
of its properties, contingencies, and other reserves.


 


10.06 FINANCIAL STATEMENTS, CERTIFICATES AND INFORMATION


 


The
Borrower (as indicated), at its sole expense, will deliver to the Lender:


 


(a)  within fifteen (15) days after the filing of
its Form 10K with the Securities Exchange Commission, the Guarantor will
provide Lender with its audited financial statement;


 


(b) within one hundred twenty (120) days of fiscal
year end, the internal statement of 


 


26

















 


operations, statement of cash flow and balance sheets of
Borrower;


 


(c) within thirty (30) days after the receipt of
the Primary Tenant’s audited financial statements, the Borrower shall provide
them to Lender; and


 


(d) from time to time such other reasonable
financial data and information as the Lender may request.


 


10.07 NOTICES


 


(a) Defaults.
The Borrower will promptly notify the Lender in writing of the occurrence of
any Default or Event of Default, specifying the nature and existence of such
Default or Event of Default and what action the Borrower is taking or proposes
to take with respect thereto. If any Person shall give any notice or take any
other action in respect of a claimed default (whether or not constituting an
Event of Default) under this Agreement or under any note, evidence of
indebtedness, indenture or other obligation to which or with respect to which
the Borrower is a party or obligor, whether as principal or surety, and such
default would permit the holder of such note or obligation or other evidence of
indebtedness to accelerate the maturity thereof,  the Borrower shall forthwith give written
notice thereof to the Lender, describing the notice or action and the nature of
the claimed default.


 


(b) Environmental
Events. The Borrower will promptly give notice to the Lender (i) of any
violation of any Environmental Law that the Borrower reports in writing or is
reportable by such Person in writing (or for which any written report
supplemental to any oral report is made) to any federal, state or local
environmental agency and (ii) upon becoming aware thereof, of any inquiry,
proceeding, investigation, or other action, including a notice from any agency
of potential environmental liability, or any federal, state or local
environmental agency or board, that in either case involves the Project or has
the potential to materially affect the assets, liabilities, financial
conditions or operations of the Borrower or such general partner or the Lender’s
liens or security interests pursuant to the Security Documents.


 


(c) Notification of Claims against Collateral.  The Borrower will, immediately upon becoming
aware thereof, notify the Lender in writing of any material setoff, claims,
withholdings or other defenses to which any of the Collateral, or the Lender’s
rights with respect to the Collateral, are subject.


 


(d) Notice
of Nonpayment. The Borrower will immediately notify the Lender in writing if
the Borrower receives any notice, whether oral or written, from any laborer,
subcontractor or materialman to the effect that such laborer, subcontractor or
materialman has not been paid when due for any labor or materials furnished in
connection with the construction of the Improvements


 


(e) Notice
of Litigation and Judgments.  The
Borrower will give notice to the Lender in writing within fifteen (15) days of
becoming aware of any litigation or proceeding threatened in writing or any
pending litigation and proceedings affecting the Project or affecting the
Borrower or to which the Borrower is or is to become a party involving an uninsured
claim against the Borrower that could reasonably be expected to have a
materially adverse effect on the Borrower or any of its general partners and
stating the nature and status of such litigation or proceedings. The Borrower
will give notice to the Lender, in writing, in form and detail satisfactory to
the Lender, within ten (10) days of any judgment not covered by insurance,
final or otherwise, against the Borrower in an amount in excess of $10,000.00.


 


(f) Notice
of Occupancy by Tenants. Excluding the Primary Tenant, the Borrower will give
written notice to the Lender at least ten (10) days prior to the
commencement of, and again on the date of, occupancy of the Improvements by any
tenant under a Lease, stating the name of the tenant, the date of occupancy,
and the area so occupied.


 


10.08 EXISTENCE


 


The
Borrower will do or cause to be done all things necessary to preserve and keep
in full force and effect its existence as a Connecticut limited liability
company. The Borrower will do or cause to be done all things 


 


27

















 


necessary
to preserve and keep in full force all of its rights and franchises. The
Borrower (a) will cause all of its properties used or useful in the
conduct of its business to the maintained and kept in good condition, repair
and working order and supplied with all necessary equipment, (b) will
cause to be made all necessary repairs, renewals, replacements, betterments and
improvements thereof, all as in the judgment of the Borrower may be necessary
so that the business carried on in connection therewith may be properly and
advantageously conducted at all times, and (c) will continue to engage
primarily in the businesses now conducted by it and in related businesses.


 


10.09 INSURANCE; BONDS


 


10.09.1  CONTRACTOR AND ARCHITECT
INSURANCE


 


(a) The
Borrower will require the Contractor to obtain and maintain at all times during
the construction of the Improvements the insurance required by the Construction
Contract and such other insurance as may be required by the Lender (including,
without limitation, commercial general liability insurance, comprehensive
automobile liability insurance, all-risk contractor’s equipment floater
insurance, workmen’s compensation insurance and employer liability insurance),
all such insurance to be in such amounts and form, to include such coverage and
endorsements, and to be issued by such insurers as shall be approved by the
Lender, and to contain the written agreement of the insurer to give the Lender
thirty (30) days prior written notice of cancellation, nonrenewal, modification
or expiration. The Borrower will provide or will cause the Contractor to
provide the Lender with certificates evidencing such insurance upon the request
of the Lender.


 


(b) 
The Borrower will require the Borrower’s Architect or any other architect,
engineer or design professional providing design or engineering services in
connection with the construction of the Improvements, to obtain and maintain
professional liability insurance covering any claims asserted with respect to
the Project for a period of not less than five (5) years after the date of
completion of the Improvements, such insurance to be in such amounts and form,
to include such coverage and endorsements, and to be issued by such insurers as
shall be approved by the Lender, and to contain the written agreement of the
insurer to give the Lender thirty (30) days prior written notice of
cancellation, nonrenewal, modification or expiration.  The Borrower will provide or will cause the Borrower’s
Architect or such other design professional to provide the Lender with
certificates evidencing such insurance upon the request of the Lender.


 


10.09.2  INSURANCE.   Borrower, at its sole cost and expense,
shall, or shall cause the Primary Tenant to insure and keep insured the
Mortgaged Premises, against such perils and hazards, and in such amounts and
with such limits, as Lender may from time to time reasonably require.   Borrower shall also carry such other insurance,
and in such amounts, as Lender may from time to time reasonably require,
against insurable risks which at the time are commonly insured against in the
case of premises similarly situated, due regard being given to the availability
of insurance and to the type of construction, location, utilities, use and
occupancy of the Mortgaged Premises or any replacements or substitutions
therefor (“Additional Insurance”). Such Additional Insurance may include flood,
earthquake, , business interruption and demolition and shall be obtained within
30 days after demand by Lender. Otherwise, Borrower shall not obtain any
separate or additional insurance which is contributing in the event of loss,
unless it is properly endorsed and otherwise reasonably satisfactory to Lender
in all respects.  Except as otherwise
required under the existing Lease with the Primary Tenant, any proceeds of
insurance in excess of Two Hundred Fifty Thousand and 00/100 Dollars
($250,000.00) paid on account of any damage to or destruction of the Mortgaged
Premises or any portion thereof shall be paid over to the Lender and shall be
applied and distributed as provided for herein and in the Mortgage.


 


10.09.2(a)              EVIDENCE
OF COVERAGE.  The
insurance shall be evidenced by the original policy or a true and certified
copy of the original policy, or in the case of liability insurance, by
certificates of insurance. Certificates evidencing such insurance shall be
delivered to Lender at or prior to Closing and certified copies or original
policies shall be delivered to Lender within thirty (30) days following
Closing. On or before the stated due date, Borrower or the Primary Tenant shall
pay all premiums and fees for the insurance policies required hereunder.
Borrower shall deliver certified copies of all policies and renewals (or
certificates evidencing the same) to Lender at least thirty (30) days before
the expiration of existing policies. Each such policy shall provide that such
policy may


 


28

















 


not
be canceled or materially changed except upon 30 days prior written notice of
intention of non-renewal, cancellation or material change to Lender, and that
no act or thing done by Borrower shall invalidate the policy as against
Lender.  Lender shall be named as
Mortgagee, loss payee and addtional insured on all such policies.  Notwithstanding anything to the contrary
contained herein or in any provision of law, the proceeds of insurance policies
coming into the possession of Lender and which are not to be used for the Work
(as hereinafter defined) shall not be deemed trust funds and Lender shall be
entitled to dispose of such proceeds as hereinafter provided and as set forth
in the Mortgage. If Lender has not received satisfactory evidence of such
renewal or substitute insurance in the time frame herein specified, Lender
shall have the right, but not the obligation, to purchase such insurance for
Lender’s interest only. Any amounts so disbursed by Lender pursuant to this Section 10.09
shall be deemed to be a part of the Loan and shall bear interest at the Default
Rate. Nothing contained in this Section 10.09 shall require Lender to
incur any expense or take any action hereunder, and inaction by Lender shall
never be deemed a waiver of any rights accruing to Lender on account of this Section 10.09.


 


10.09.2(b)              SEPARATE
INSURANCE.  Borrower
shall not carry any separate insurance on the Mortgaged Premises concurrent in
kind or form with any insurance required hereunder or contributing in the event
of loss without Lender’s prior written consent, and any such policy shall have
attached a standard non-contributing mortgagee clause, with loss payable to
Lender, and shall meet all other requirements set forth herein.


 


10.09.2(c)              DAMAGE
TO OR DESTRUCTION OF MORTGAGED PREMISES.    In the event of any damage to or destruction
of the Mortgaged Premises, Borrower shall give prompt written notice to Lender
and provided that no Event of Default has occurred hereunder, Lender shall
relesae any insurance proceeds received by it to the Borrower provided that the
Borrower uses it strictly in compliance with its obligations under the Lease
with the Primary Tenant, Borrower shall promptly commence and diligently
continue to complete the repair, restoration and rebuilding of the Mortgaged
Premises so damaged or destroyed in full compliance with all legal requirements
and with the provisions of the Lease and as set forth in Section 10.9.2(d) below,
and free and clear from any and all liens and claims. Such repair, restoration
and rebuilding of the Mortgaged Premises are sometimes hereinafter collectively
referred to as the “Work.” Borrower shall not adjust, compromise or settle any
claim for insurance proceeds without the prior written consent of Lender, which
consent shall not be unreasonably withheld or delayed.


 


10.09.2(d)              RESTORATION. Borrower
warrants, covenants and represents that:


 


(i) During
the period following a casualty until the Work has been completed, Borrower
shall cause the insurance proceeds, together with any additional sums deposited
by Borrower with the Lender in respect of the applicable casualty to equal or
exceed such estimated cost of effecting such repair and restoration, or such
portion thereof as then remains to be completed and paid for;


 


(ii) Upon
completion of the Work, the monthly rents from all Leases remaining in full
force and effect shall, in Lender’s reasonable judgment, be sufficient to pay
all Operating Expenses of the Mortgaged Premises and all regularly scheduled
principal, interest and other sums due and payable under the Construction Note,
this Agreement and the other Loan Documents.


 


(iii) At
all times, there shall be in force and effect for the benefit of Borrower and
Lender rental interruption insurance sufficient to provide coverage for one
hundred percent (100%) of all rental income lost as a consequence of such
casualty for a total of at least twelve (12) months;


 


(iv) The
Work will be effected pursuant to plans and specifications reasonably approved
in writing by Lender, and by a general contractor and major subcontractors, and
pursuant to contracts, approved in writing by Lender; and


 


(v) The
Work can be effected in compliance with all applicable laws and Borrower shall
have obtained all licenses, permits, consents and approvals from all applicable
governmental authorities or private parties required to permit Borrower to
effect such restoration and repair and to use, operate and occupy the repaired
and restored premises upon completion thereof (other than those which will
issue in the ordinary course upon completion) and that the same shall be in
full force and effect.


 


29
















 


10.09.2(e)              DISTRIBUTION
OF PROCEEDS.  If any
insurance Proceeds are used for the Work, Borrower warrants, covenants and
represents:


 


(i) If
the Work is structural or if the cost of the Work is reasonably estimated by
Lender to exceed Two Hundred Fifty Thousand and 00/100 Dollars ($250,000.00),
the Work shall be conducted under the supervision of a certified and registered
architect or engineer. Before Borrower commences any Work, other than temporary
work to protect property or prevent interference with business, Lender shall
have approved in writing the plans and specifications for the Work, which
approval shall not be unreasonably withheld or delayed, it being nevertheless
understood that such plans and specifications shall provide for Work so that,
upon completion thereof, the Mortgaged Premises shall be at least equal in
value and general utility to the Mortgaged Premises prior to the damage or
destruction.


 


(ii) Borrower
shall deliver to Lender a certificate of the architect or engineer in (i) above
(or a certificate given by Borrower if no architect or engineer is so required)
stating (A) that all of the Work completed has been done in compliance
with the approved plans and specifications, if required under (i) above, (B) that
the proceeds to be distributed are justly required to reimburse the Borrower
for payments made by Borrower, or are justly due to the contractor,
subcontractors, materialmen, laborers, engineers, architects or other persons
rendering services or materials for the Work (giving a brief description of
such services and materials), and that when added to all sums previously paid
out by the Lender does not exceed the value of the Work done to the date of
such certificate, (C) if the sum to be distributed is to cover payment
relating to repair and restoration of personal property required or relating to
the Mortgaged Premises, that title to the personal property items covered by
the requested payment is vested in Borrower, and (D) that the amount of
such proceeds remaining in the hands of the Lender will be sufficient on
completion of the Work to pay for the same in full (giving in such reasonable
detail as Lender may require an estimate of the cost of such completion).
Additionally, Borrower shall deliver to Lender a statement signed by Borrower
approving both the Work done to date and the Work covered by the payment in
question.


 


(iii) Borrower
shall deliver waivers of lien satisfactory to Lender covering that part of the
Work for which payment or reimbursement is being requested and, if required by
Lender, a search prepared by a title company, or by other evidence satisfactory
to Lender that there has not been filed with respect to the Mortaged Premises
any mechanics’ or other lien or instrument for the retention of title relating
to any part of the Work not discharged of record. Additionally, as to any
personal property covered by the request for payment, Lender shall be furnished
with evidence of payment therefor and such further evidence satisfactory to
assure Lender of its valid first lien on the personal property.


 


(iv) Lender
or its designee shall have the right to inspect the Work at all reasonable
times. The reasonable cost of any such inspection of the Work shall be paid by
Borrower upon demand. Neither the approval by Lender of the plans and
specifications for the Work nor the inspection by Lender of the Work shall make
Lender responsible for the preparation of such plans and specifications or the
compliance of such plans and specifications, or of the Work, with any
applicable law, regulation, ordinance, covenant or agreement.


 


(v) Borrower
shall deliver a copy or copies of any certificate or certificates required by
law to render occupancy and full operation of the Mortgaged Premises legal.


 


10.09.2(f)                              MISCELLANEOUS
INSURANCE PROVISIONS.


 


(i) The
insurance requirements contained in this Section 10.9.2(f) are in
addition to, and supplement the insurance requirements contained in the
Mortgage.


 


(ii) In
the event of the foreclosure of the Mortgage or other transfer of title to or
assignment of the Mortgaged Premises in extinguishment of the debt due Lender
in whole or in part, all right, title and interest of Borrower in and to all
policies of insurance required by this Agreement and any insurance proceeds
shall inure to the benefit of and pass to Lender or any purchaser or transferee
of the Mortgaged Premises.


 


(iii) Borrower
hereby authorizes Lender, during all periods in which an Event of Default has
occurred and remains uncured, to settle any insurance claims, to obtain
insurance proceeds, and to endorse any 


 


30

















 


checks,
drafts or other instruments representing any insurance proceeds whether payable
by reason of loss thereunder or otherwise.


 


10.10 TAXES


 


(a) The
Borrower will pay, or cause to be paid and discharged, all taxes, assessments
and other governmental charges imposed upon it with respect to the Project or
imposed upon the Project at the time and in the manner required by the
Mortgage, before the same shall become overdue. The Borrower will promptly pay
and discharge (by bonding or otherwise) all claims for labor, material or
supplies that if unpaid might by law become a lien or charge against the
Project or any part thereof or might affect the priority of the lien created by
the Mortgage with respect to any Advance made or to be made by the Lender under
this Agreement.


 


(b) The
Borrower will duly pay and discharge, or cause to be paid and discharged,
before the same shall become overdue, all taxes, assessments and other governmental
charges imposed upon it and its other real properties, sales and activities, or
any part thereof, or upon the income or profits therefrom, as well as all
claims for labor, materials, or supplies that if unpaid might by law become a
lien or charge upon any of its property; provided that any such tax,
assessment, charge, levy or claim with respect to properties other than the
Project need not be paid if the validity or amount thereof shall currently be
contested in good faith by appropriate proceedings and if the Borrower shall
have set aside on its books adequate reserves with respect thereto; and
provided further that the Borrower will pay all such taxes, assessments,
charges, levies or claims forthwith upon the commencement of proceedings to
foreclose any lien that may have attached as security therefore.


 


10.11 INSPECTION OF PROJECT, OTHER PROPERTIES AND BOOKS


 


(a) The
Borrower shall permit the Lender and the Construction Inspector, at the
Borrower’s expense, to visit and inspect the Project and all materials to be
used in the construction thereof and will cooperate with the Lender and the
Construction Inspector during such inspections (including making available
working drawings of the Plans and Specifications); provided that this provision
shall not be deemed to impose on the Lender or the Construction Inspector any
obligation to undertake such inspections.


 


(b) The
Borrower shall permit the Lender at the Borrower’s expense to visit and inspect
any of the other properties of the Borrower to examine the books of account of
the Borrower (and to make copies thereof and extracts therefrom) and to discuss
the affairs, finances and accounts of the Borrower with, and to be advised as
to the same by, its officers, all at such reasonable times and intervals as the
Lender may reasonably request.


 


10.12 COMPLIANCE WITH LAWS, CONTRACTS, LICENSES AND PERMITS


 


The
Borrower will comply with, (a) the applicable laws and regulations
wherever its business is conducted, including all Environmental Laws and, in
the case of the Borrower, all Requirements, (b) the provisions of its
operating agreement and other charter documents and by-laws, (c) all
agreements and instruments by which it or any of its properties may be bound,
including, in the case of the Borrower, the Architect’s Contract, the
Construction Contract and all restrictions, covenants and easements affecting
the Project, (d) all applicable decrees, orders and judgments, and (e) all
licenses and permits required by applicable laws and regulations for the
conduct of its business or the ownership, use or operation of its properties,
including, in the case of the Borrower, all Project Approvals.


 


10.13 PROJECT APPROVALS


 


The
Borrower will promptly obtain all Project approvals not heretofore obtained by
the Borrower (including those listed and described on Exhibit “N”  hereto and any other Project Approvals which
may hereafter become required, necessary or desirable) and will furnish the
Lender with evidence that the Borrower has obtained such Project Approvals
promptly upon its request. The Borrower will give all such notices to, and take
all such other actions with respect to, such Governmental Authority as may be
required under applicable Requirements to construct the Improvements and to
use, occupy and operate the Project following the completion of the
construction 


 


31

















 


of
the Improvements. The Borrower will also promptly obtain all utility
installations and connections required for the operation and servicing of the Project
for its intended purposes, and will furnish the Lender with evidence thereof.
The Borrower will duly perform and comply with all of the terms and conditions
of all Project Approvals obtained at any time, including all Project Approvals
listed and described on Exhibit “Q” hereto.


 


10.14 USE OF PROCEEDS


 


The
Borrower will use the proceeds of the Construction Loan solely for the purpose
of paying for Project Costs in accordance with the Project Budget.  Additionally, the Lender agrees that should
actual construction costs be less than the approved Construction Budget (the “Construction
Savings”) and the Lender has not fully Advanced the Loan, the Borrower shall be
entitled to recoup equity up to Five Hundred Thousand and 00/100 Dollars
($500,000.00) (on a dollar-for-dollar basis, equal to the Construction Savings)
at the time of issuance of a final Certificate of Occupancy.


 


10.15 PROJECT COSTS


 


The
Borrower will pay all Project Costs in excess of the Construction Loan Amount,
regardless of the amount, and prior to the same being overdue.


 


10.16 INSUFFICIENCIES OF CONSTRUCTION LOAN PROCEEDS


 


The
Borrower will deposit funds with the Lender as follows: If at any time while
the Construction Loan is outstanding or the Lender has any obligation to make
Advances hereunder, the Lender shall in its reasonable discretion determine
that the remaining undisbursed portion of the Construction Loan, together with
the Required Equity Funds and any other sums previously deposited by the
Borrower with the Lender in connection with the Construction Loan, is or will
be insufficient to fully complete and equip the Improvements in accordance with
the Plans and Specifications, to operate and carry the Project after completion
of the Improvements until payment in full of the Construction Loan by the
Borrower, to pay all other Project Costs, to pay all interest accrued or to
accrue on the Construction Loan during the term of the Construction Loan from
and after the date hereof, and to pay all other sums due or to become due under
the Loan Documents (or as to any budget category or line item), regardless of
how such condition may be caused, the Borrower will, within seven (7) days
after written notice of such determination from the Lender, deposit with the
Lender such sums of money in cash as the Lender may require, in an amount
sufficient to remedy the condition described in such notice, and sufficient to
pay any liens for labor and materials alleged to be due and payable at the time
in connection with the Improvements, and, at the Lender’s option, no further
Advances of the Construction Loan shall be made by the Lender until the
provisions of this Section 10.16 have been fully complied with. All such
deposited sums shall stand as additional security for the Obligations and shall
be disbursed by the Lender in the same manner as Advances under this Agreement
before any further Advances of the Construction Loan proceeds shall be made.
The Lender shall have no obligation to pay the Borrower any interest with
respect to such deposited funds.


 


10.17 LEASES


 


The
Borrower will take or cause to be taken all steps within the power of the
Borrower to market and lease the leasable area of the Improvements to such
tenants and upon such terms and conditions as may be approved by the Lender.  Any proposed standard form of lease to be
used by the Borrower in connection with the Improvements shall be submitted to
and approved by the Lender prior to its submission to any proposed tenant, and
the Borrower will make such amendments, modifications or additions thereto as
may be required by the Lender. The leases to any tenant who will lease or
occupy thirty percent (30%) or more of the net leasable area of the
Improvements (other than the Primary Tenant) will require that such tenant
prepare and deliver to the Borrower and the Lender annual financial statements
certified by an independent certified public accountant within 120 days
following the end of each fiscal year of such tenant. The Borrower will
require, and each Lease will require, each tenant to enter into a
Nondisturbance, Attornment and Subordination Agreement upon the request of the
Lender.  The Lender shall have 


 


32

















 


the
right, and the Borrower hereby authorizes the Lender, to communicate directly with
any tenant under a Lease to verify any information delivered to the Lender by
the Borrower concerning such tenant or such tenant’s Lease.


 


10.18 LABORERS, SUBCONTRACTORS AND MATERIALMEN


 


The
Borrower will furnish to the Lender, upon request at anytime, and from time to
time, affidavits listing all laborers, subcontractors, materialmen, and any
other Persons who might or could claim statutory or common law liens and are
furnishing or have furnished labor or material to the Project or any part
thereof, together with affidavits, or other evidence satisfactory to the
Lender, showing that such parties have been paid all amounts then due for Labor
and materials furnished to the Project. The Borrower will also furnish to the
Lender, at any time and from time to time upon demand by the Lender, lien
waivers bearing a then current date and prepared on a form satisfactory to the
Lender from the Contractor and such subcontractors or materialmen as the Lender
may designate.


 


10.19 DEPOSIT OF INCOME


 


The
Borrower will deposit with the Lender, upon request at any time following an
Event of Default, any sums (other than base rent, which is being paid to a lock
box) received by the Borrower from tenants under Leases (other than amounts
paid by tenants to reimburse the Borrower for construction work performed for
tenants the cost of which has not been disbursed to the Borrower by the Lender
under the Construction Loan), in a special account, from which no funds shall
be drawn by the Borrower without the Lender’s prior approval, and which sums
shall stand as additional security for the Obligations.  It is expressly agreed that at the Lender’s
option, such sums shall be disbursed in the same manner as Advances before any
further Advance of the Construction Loan is made.


 


10.20 PUBLICITY


 


The
Borrower will permit the Lender to obtain publicity in connection with the
construction of the Improvements through press releases and participation in
such events as ground breaking and opening ceremonies. The Borrower will give
the Lender ample advance notice of such events and will cooperate with and
provide to the Lender as much assistance as possible in connection with
obtaining such publicity.


 


10.21 SIGN REGARDING CONSTRUCTION FINANCING


 


If
requested by the Lender, the Borrower will, at its cost and expense, erect and
maintain on a suitable location on the Land a sign indicating that the
construction financing for the Project is being provided by the Lender, such
location and sign to be subject to the approval of the Lender.


 


10.22 FURTHER ASSURANCES


 


(a) Regarding
Construction. The Borrower will furnish or cause to be furnished to the Lender
all instruments documents, boundary surveys, footing or foundation surveys,
certificates, plans and specifications, title and other insurance, reports and
agreements and each and every other document and instrument required to be
furnished by the terms of this Agreement or the other Loan Documents, all at
the Borrower’s expense.


 


(b) Regarding
Preservation of Collateral. The Borrower will execute and deliver to the Lender
such further documents, instruments, assignments and other writings, and will
do such other acts necessary or desirable, to preserve and protect the
Collateral at any time securing or intended to secure the Obligations, as the
Lender may require.


 


(c) 
Regarding title. If at any time the Lender or the Lender’s counsel has reason
to believe that any Advance is not secured or will or may not be secured by the
Mortgage as a first lien or security interest on the Project, then the Borrower
shall, within ten (10) days after written notice from the Lender, do all
things and matters necessary, to assure to the satisfaction of the Lender and
the Lender’s counsel that any Advance previously made hereunder or to be made
hereunder is secured or will be secured by the Mortgage as a first lien or
security interest on the Project, and the Lender, at its option, may decline to
make further Advances hereunder until the Lender has received such assurance,
but nothing in this Section 10.22 shall limit the Lender’s right to
require endorsements extending the effective date of the Title Policy as herein
set forth.


 


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(d) Regarding
this Agreement. The Borrower will cooperate with, and will do such further acts
and execute such further instruments and documents as the Lender shall
reasonably request to carry out to its satisfaction the transactions
contemplated by this Agreement and the other Loan Documents.


 


10.23  NO MERGER OR
ACQUISITION


 


Borrower
will not merge or consolidate or be merged or consolidated with or into any
other corporation or business entity, nor acquire substantially all of the
assets and/or stock of another corporation or other business entity, unless
specifically authorized by Lender, in writing, in advance.


 


10.24  NO SUBSTITUTION


 


This
Agreement may but need not be supplemented by separate assignments and pledges
and, if such assignments and pledges are given, the rights and security
interests given thereby shall be in addition to and not in limitation of the
rights and security interests given by this Agreement.  This Agreement shall not act to terminate,
cancel, revoke, nor otherwise cause a novation, estoppel, or waiver of any or
all prior security interests granted by Borrower to Lender in and to any
collateral contemplated by these presents, or other, wholly or in part, and
without exception; and any and all such security interests shall continue to
remain properly perfected by Borrower to Lender in their terms and without
interruption.


 


10.25  PROTECTION OF
COLLATERAL


 


Borrower
will maintain all Collateral in a condition which is comparable to that which
exists on the date of the issuance of the final Certificate of Occupancy, and
make any necessary repairs thereto, or replacements thereof; ordinary wear and
tear and obsolescence excepted.


 


Borrower
will at the request of Lender, promptly furnish Lender the receipted bills for
all payments required by this Agreement. 
At its option, but without liability so to do, Lender may discharge taxes,
assessments, liens or security interests or other encumbrances at any time
levied or placed on the Collateral, may pay for insurance on the Collateral and
may pay for the maintenance and preservation of the Collateral. Borrower agrees
to reimburse Lender on demand for any payments made by Borrower, or any
expenses including attorneys’ fees incurred by Lender pursuant to the foregoing
authorization, and upon failure of Borrower so to reimburse Lender, any such
sums paid or advanced by Lender shall be deemed secured by the Collateral and
constitute part of the Loans.


 


10.26  COMPLIANCE WITH ERISA


 


The
Borrower will not:


 


(A) engage
in any prohibited transaction (within the meaning of Section 406 of ERISA
or Section 4975 of the Code), or commit any other breach of its fiduciary
responsibility under Part 4 of Title I of ERISA, which could subject the
Borrower or any Borrower Group Member to any material liability under Section 406,
409, 502(i) or 502(d) of ERISA or Section 4975 of the Code, or
under any agreement or other instrument pursuant to which the Borrower or such
Borrower Group Member could be required to indemnify any Person against any
such liability or which could otherwise have a Material Adverse Effect on the
Borrower or any Plan; or


 


(B) fail
to make any contribution required to be made by it to any Plan or Multiemployer
Plan or permit to exist with respect to any Plan any “accumulated funding
deficiency” (as such term is defined in Section 412 of the Code or Section 302
of ERISA), whether or not waived; or


 


34

















 


(C) (i) commence
proceedings to terminate any Plan, other than in a “standard termination”
within the meaning of Section 4041 of ERISA, or (ii) permit to exist
any proceedings instituted by the PBGC to terminate or to have a trustee
appointed to administer any Plan, or (iii) withdraw from any Multiemployer
Plan in a manner which could result in the imposition of a withdrawal liability
under Part 1 of Subtitle E of Title IV of ERISA.


 


10.27  FINANCING STATEMENTS


 


Prior
to any loan being made from Lender to Borrower, the Borrower hereby agrees that
Lender may file and record at Borrower’s cost, any financing statement, or
other notices appropriate under applicable law, in respect of any security
interest created pursuant to this Agreement or at any other time which may at
any time be required by the Lender.  The
Borrower authorizes the Lender to file any and all financing statements on
behalf of the Borrower describing the Collateral, as well as any agricultural
liens or other statutory liens held by Lender. 
In the event that any re-recording or re-filing thereof (or the filing
of any statements of continuation or assignment of any financing statement) is
required to protect and preserve such lien or security interest, the Borrower
shall, at its cost and expense, cause the same to be re-recorded and/or
re-filed at the time and in the manner requested by the Lender.  The Borrower hereby irrevocably designates
the Lender, its agents, representatives and designees as agents and
attorneys-in-fact for the Borrower to sign such financing statements, or other
instruments in connection herewith, on behalf of the Borrower and file the
same, as required.


 


10.28 TAXES AND IMPOSITIONS


 


(A) Borrower
shall (i) pay and discharge all Impositions prior to delinquency, and (ii) provide
Lender validated receipts or such other evidence satisfactory to Lender showing
the payment of such Impositions within thirty (30) days after the same would
have otherwise become delinquent. 
Borrower’s obligation to pay the Impositions pursuant to this Agreement
shall include, to the extent permitted by applicable law, taxes resulting from
future changes in law which impose upon Lender an obligation to pay any
property taxes or other Impositions. 
Should Borrower default on any payment of any Impositions, Lender may
(but shall not be obligated to) pay such Impositions or any portion thereof and
Borrower shall reimburse Lender on demand for all such payment(s).


 


(B) Borrower
shall not be required to pay, discharge or remove any Imposition so long as
Borrower contests in good faith such Impositions or the validity, applicability
or amount thereof by an appropriate legal proceeding which operates to prevent
the collection of such amounts and the sale of the Mortgaged Premises, or any
portion thereof; provided, however, that prior to the date on which such
Imposition would otherwise have become delinquent, Borrower shall have (i) given
Lender prior written notice of such contest and (ii) deposited with
Lender, and shall deposit such additional amounts as are necessary to keep on
deposit at all times, in an amount equal to at least one hundred percent (100%)
of the total of (A) the balance of such Imposition then remaining unpaid,
and (B) all interest, penalties, costs and charges accrued or accumulated
thereon.   Lender shall keep said
deposited amounts in an interest bearing, aggregated account (the “Account”)
for the Borrower and shall pay out interest at least annually thereon.  Any such contest shall be prosecuted with due
diligence, and Borrower shall promptly pay from the Account, the amount of such
Imposition as finally determined, together with all interest and penalties
payable in connection therewith.  Lender
shall have full power and authority to apply any amount deposited with Lender
pursuant to this clause to the payment of any unpaid Imposition to prevent the
sale or forfeiture of the Mortgaged Premises or any portion thereof for
non-payment thereof.  Lender shall have
no liability, however, for failure to so apply any amount deposited.  Any surplus retained by Lender after payment
of the Imposition for which a deposit was made, shall be repaid to Borrower
unless an Event of Default shall have occurred, in which case said surplus may
be retained by Lender to be applied to the obligations in the sole discretion
of the Lender.  Notwithstanding any
provisions of this clause to the contrary, Borrower shall pay any Imposition
which it might otherwise be entitled to contest if, in the sole and absolute
discretion of Lender, the Mortgaged Premises, or any portion thereof or any
Collateral, is in jeopardy or in danger of being forfeited or foreclosed.  If Borrower refuses to pay any such
Imposition, Lender may (but shall not be obligated to) make such payment and
Borrower shall reimburse Lender on demand for all such advances.


 


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10.29  MAINTENANCE OF RECORDS


 


Keep
adequate records and books of account, in which complete entries will be made
in accordance with GAAP consistently applied, reflecting all financial
transactions of the Borrower.


 


10.30  MAINTENANCE OF
PROPERTIES


 


Maintain,
preserve and keep, its properties which are used or useful in the conduct of
its business (whether owned in fee or a leasehold interest) in good repair and
working order and from time-to-time will make all necessary repairs,
replacements, renewals and additions so that at all times the efficiency
thereof shall be maintained.  Borrower
agrees that it will maintain and repair the Collateral and the Mortgaged
Premises and keep all of the same in good and serviceable condition and in at
least as good condition and repair as same were on the date hereof or in such
better condition and repair as same may have been put thereafter.  Borrower will not waste or destroy or suffer
the waste or destruction of the Collateral or the Mortgaged Premises or any
part thereof.  Borrower will not use any
of the Collateral or the Mortgaged Premises in violation of any insurance
thereon.  In the event of damage to or
destruction of all or any part of the Collateral or the Mortgaged Premises from
any cause, the Borrower shall repair, replace, restore and reconstruct the
Collateral and the Mortgaged Premises to the extent necessary to restore each
portion of same to its condition immediately prior to such damage or
destruction and this obligation shall not be limited by the amount of any
insurance proceeds available.


 


10.31  COMPLIANCE WITH LAWS


 


Promptly
pay and discharge all lawful taxes, assessments and governmental charges or
levies imposed upon the Borrower, or upon, or in respect of, all or any part of
the property or business of the Borrower, all trade accounts payable in
accordance with usual and customary business terms, and all claims for work,
labor or materials, which if unpaid might become a lien or charge upon any
property of the Borrower; provided the Borrower shall not be required to pay
any such tax, assessment, charge, levy, account payable or claim if (i) the
validity, applicability or amount thereof is being contested in good faith by
appropriate actions or proceedings which will prevent the forfeiture or sale of
any property of the Borrower or any material interference with the use thereof
by the Borrower, and (ii) the Borrower shall set aside on its books,
reserves deemed by it to be adequate with respect thereto. The Borrower will
promptly comply with all laws, ordinances or governmental rules and
regulations to which it is subject, including without limitation, the
Occupational Safety and Health Act of 1970, ERISA, the Americans with
Disabilities Act and all Environmental Laws in all applicable jurisdictions,
the violation of which would materially and adversely affect the properties,
business, prospects, profits or condition of the Borrower or would result in
any lien or charge upon any property of the Borrower.


 


10.32  ENVIRONMENT


 


Notify
the Lender immediately of any notice of a hazardous discharge or environmental
complaint received from any governmental agency or any other party; notify the
Lender immediately of any hazardous discharge from or affecting its premises;
immediately contain and remove the same, in compliance with all applicable
laws; promptly pay any fine or penalty assessed in connection therewith, except
such assessments as are being contested in good faith, against which adequate
reserves have been established; upon receipt of such notification, permit the
Lender to inspect the premises, and to inspect all books, correspondence, and
records pertaining thereto; and at the Lender’s request, and at the Borrower’s
expense, provide a report of a qualified environmental engineer, satisfactory
in scope, form, and content to the Lender, arid such other and further
assurances reasonably satisfactory to the Lender that the condition has been
corrected.


 


10.33  PAYMENT OF LOANS


 


The
Borrower will duly and punctually pay the Principal of, and interest on the
Loans in accordance with the terms of the Loans and this Agreement.


 


10.34  [RESERVED]


 


36

















 


10.35  MORTGAGE TAXES


 


Borrower
shall pay all taxes, charges, filing, registration, recording fees, excises and
levies imposed upon Lender by reason of their respective interest in, or
measured by amounts payable under the Note, this Agreement, the Mortgage or any
other Loan Document (other than income, franchise and doing business taxes),
and shall pay all stamp taxes and other taxes required to be paid on the Note,
this Agreement, the Mortgage or the other Loan Documents.  If Borrower fails to make such payment within
five days after notice thereof from Lender, Lender may (but shall not be
obligated to) pay the amount due, and Borrower shall reimburse Lender on demand
for all such Advances.  If applicable law
prohibits Borrower from paying such taxes, charges, filing, registration and
recording fees, excises, levies, stamp taxes or other taxes, then Lender may
declare the Indebtedness then unpaid to be immediately due and payable.  In such event, no Prepayment Fee (as defined
in the Note) shall be charged.


 


10.36  LENDER’S EXPENSES


 


Borrower
shall pay, on demand by Lender, all reasonable expenses, charges, costs and
fees in connection with the negotiation, documentation and closing of the Loan,
including all registration, recording fees and insurance consultant fees, if
any, environmental consultant fees, costs of appraisals, costs of engineering
reports, fees and disbursements of all counsel (both local and special) of
Lender, escrow fees, cost of surveys, fees and expenses of Lender’s Consultant
or others employed by Lender to inspect the Collateral from time to time and
reasonable out-of-pocket travel expenses incurred by Lender and Lender’s agents
and employees in connection with the Loan. 
At Closing, Lender may pay directly from the proceeds of the Loan each
of the forgoing expenses.


 


10.37      OPERATING BUDGET. On or before December 31st
of each year during the term of the Loan Borrower shall submit to Lender for
Lender’s review and approval Borrower’s Operating Budget for the Mortgaged
Premises for the following calendar year. The Operating Budget shall include
all budgeted Gross Revenues, Operating Expenses and capital expenditures for
the Mortgaged Premises.   Operating
Expenses and capital expenditures shall be in a detailed line item format, and
the Operating Budget shall include a comparison to the immediately preceding
year.


 


11.00 NEGATIVE COVENANTS OF THE BORROWER


 


The
Borrower covenants and agrees that, so long as the Construction Loan is
outstanding or the Lender has any obligation to make any Advances:


 


11.01 RESTRICTION ON CHANGE ORDERS


 


The
Borrower will not cause, permit or suffer to exist any deviations from the
Plans and Specifications, which will result in a decrease in the Project Costs
of Fifty Thousand and 00/100 Dollars ($50,000.00) or an increase in the Project
Costs of Fifty Thousand and 00/100 Dollars ($50,000.00) and will not approve or
consent to any change order or construction change directive except where the
same is being paid for by the Borrower and has in fact been fully paid by the
Borrower simultaneous with the request for a change order or construction
change directive without the prior approval which will not be unreasonably
withheld or delayed, of the Lender.


 


11.02 RESTRICTIONS ON EASEMENTS, COVENANTS AND RESTRICTIONS


 


The
Borrower will not create or suffer to be created or to exist any easement,
right of way, restriction, covenant, condition, license or other right in favor
of any Person which affects or might affect title to the Project or the use and
occupancy of the Project or any part thereof without (i) submit ting to
the Lender and the proposed instrument creating such easement, right of way,
covenant, condition, license or other right, accompanied by a survey showing
the exact proposed location thereof and such other information as the Lender
may reasonably request, and (ii) obtaining the prior approval of the
Lender.


 


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11.03 NO AMENDMENTS, TERMINATIONS OR WAIVERS


 


(a) The
Borrower will not amend, supplement or otherwise modify, whether by change
order or otherwise, any of the terms and conditions of the Architect’s Contract
or the Construction Contract without in each case the prior approval of the
Lender, and in the case of the Construction Contract, without the prior
approval of the Lender.


 


(b) The
Borrower will not, directly or indirectly, terminate or cancel, or cause or
permit to exist any condition which would result in the termination or
cancellation of, or which would relieve the performance of any obligations of
any other party under, the Architect’s Contract or the Construction Contract.


 


(c) The
Borrower will not, directly or indirectly, waive or agree or consent to the
waiver of, the performance of any obligations or any other party under the
Architect’s Contract of the Construction Contract.


 


11.04 RESTRICTIONS ON INDEBTEDNESS


 


Excluding
a mortgage, junior to the Lender’s mortgage, when it does not agree to Fund the
Expansion (the “Expansion Mortgage” the Borrower will not create, incur,
assume, guarantee or be or remain liable, contingently or otherwise, with
respect to any Indebtedness other than:


 


(a) Indebtedness
to the Lender arising under any of the Loan Documents;


 


(b) current
liabilities of the Borrower incurred in the ordinary course of business but not
incurred through (i) the borrowing of money, or (ii) the obtaining of
credit except for credit on an open account basis customarily extended and in
fact extended in connection with normal purchases of goods and services;


 


(c) Indebtedness
in respect of taxes, assessments, governmental charges or levies and claims for
labor, materials and supplies to the extent that payment therefore shall not at
the time be required to be made in accordance with the provisions of Section 10.10
(provided, however, that with respect to any Indebtedness to the Contractor,
the Contractor shall have entered into a subordination agreement (the “Contractor’s
Subordination Agreement”), in form and substance satisfactory to the Lender,
subordinating the Borrower’s obligation to pay Retainage to the full payment
and performance of the Obligations);


 


(d) Indebtedness
in respect of judgments or awards that have been in force for less than the
applicable period for taking an appeal so long as execution is not levied
thereunder or in respect of which the Borrower shall at the time in good faith
be prosecuting an appeal or proceeding for review and in respect of which a
stay of execution shall have been obtained pending such appeal or review;


 


(e) endorsements
for collection, deposit or negotiation and warranties of products or services,
in each case incurred in the ordinary course of business; and


 


(f) unsecured
Indebtedness of the Borrower owing to any member of the Borrower (including the
Required Equity Funds), that is expressly subordinated and made junior to the
payment and performance in full of the Obligations and evidenced as such by a
written instrument containing subordination provisions in form and substance
approved by the Lender.


 


11.05 RESTRICTIONS ON LIENS, ETC.


 


Excluding
the Expansion Mortgage, the Borrower will not (a) create or incur or
suffer to be created or incurred or to exist any lien, encumbrance, mortgage,
pledge, charge restriction or other security interest of any kind upon any of
its property or assets of any character whether now owned or hereafter
acquired, or upon the income or profits therefrom; (b) transfer any of its
property or assets or the income or profits therefrom for the purpose of
subjecting the same to the payment of Indebtedness or performance of any other
obligation in priority to payment of its general creditors; (c) acquire or
agree or have an option to acquire, any property or assets upon conditional
sale or other title retention or purchase money security agreement, device or
arrangement; (d) suffer to exist for a period of more than thirty (30)
days after the same shall have been incurred any Indebtedness or claim or
demand against it that if unpaid might by law or upon bankruptcy or insolvency,
or otherwise, be given any priority whatsoever over 


 


38

















 


its
general creditors; or (e) sell, assign, pledge or otherwise transfer any
accounts, contract rights, general intangibles, chattel paper or instruments,
with or without recourse; provided that the Borrower may create or incur or
suffer to be created or incurred or to exist, the following Permitted Liens:


 


(i) liens
to secure taxes, assessments and other governmental charges or claims for
labor, material or supplies in respect of obligations not overdue;


 


(ii) deposits
or pledges made in connection with, or to secure payment of, workmen’s
compensation, unemployment insurance, old age pensions or other social security
obligations;


 


(iii) liens
of carriers, warehousemen, mechanics and materialmen, and other like liens on
properties other than the Project in existence less than 120 days from the date
of creation thereof in respect of obligations not overdue;


 


(iv) encumbrances
on properties other than the Project consisting of easements, rights of way,
covenants, restrictions on the use of real property and defects and
irregularities in the title thereto, landlord’s or lessor’s liens under leases
to which the Borrower is a party, and other minor liens or encumbrances on
properties other than the Project none of which in the opinion of the Borrower
interferes materially with the use of the property affected in the ordinary
conduct of the business of the Borrower, which defects do not individually or
in the aggregate have a materially adverse effect on the business of the
Borrower;


 


(v) liens in favor of the Lender under the Loan Documents; and


 


(vi) other
liens on the Project consisting of easements, rights of way, covenants and
restrictions if and to the extent the same have been approved by the Lender.


 


11.06 RESTRICTIONS ON INVESTMENTS


 


The
Borrower will not make or permit to exist or to remain outstanding any
Investment except Investments in:


 


(a) marketable
direct or guaranteed obligations of the United States of America that mature
within one (1) year from the date of purchase by the Borrower;


 


(b) demand
deposits, certificates of deposit, bankers acceptances and time deposits of
United States banks having total assets in excess of $1,000,000,000; and


 


(c) securities
commonly known as “commercial paper” issued by a corporation organized and
existing under the laws of the United States of America or any state thereof
that at the time of purchase have been rated and the ratings for which are not
less than “P 1” if rated by Moody’s Investors Services, Inc., and not less
than “A 1” if rated by Standard and Poor’s.


 


11.07 MERGER, CONSOLIDATION AND DISPOSITION OF ASSETS


 


(a) The
Borrower will not become a party to any merger or consolidation, or agree to or
effect any asset acquisition or stock acquisition (other than the acquisition
of assets in the ordinary course of business consistent with past practices).


 


(b) The
Borrower will not become a party to or agree to or effect any disposition of
the Project or any part thereof, unless such agreement provides for the
payment, in full, of all of Borrower’s Obligations.


 


(c) The
Borrower will not become a party to or agree to effect any disposition of
assets, other than the disposition of assets not included in the Project in the
ordinary course of business, consistent with the past practices.


 


39
















 


11.08 SALE AND LEASEBACK


 


The
Borrower will not enter into any arrangement, directly or indirectly, whereby
the Borrower shall sell or transfer any property owned by it in order then or
thereafter to lease such property or lease other property that the Borrower
intends to use for substantially the same purpose as the property being sold or
transferred.


 


11.09 COMPLIANCE WITH ENVIRONMENTAL LAWS


 


Except
as set forth on Exhibit “M”, the Borrower will not do any of the
following: (a) use any of the Real Estate or any portion thereof as a
facility for the handling, processing, storage or disposal of Hazardous
Materials, (b) cause or permit to be located on any of the Real Estate any
underground tank or other underground storage receptacle for Hazardous
Materials except in full compliance with Environmental laws, (c) generate
any Hazardous Materials on any of the Real Estate except in full compliance
with Environmental Laws, or (d) conduct any activity at any Real Estate or
use any Real Estate in any manner so as to cause a Release.


 


11.10 DISTRIBUTIONS


 


The
Borrower will not make any Distributions during the tenure of its Construction
Loan; provided, however, that during the tenure of the Construction Loan, the
Borrower may make distributions provided that (i) no Event of Default has
occurred and (ii) the Borrower has complied with all terms, covenants and
conditions of this Agreement, including, without limitation, the covenants set
forth in Section 17.01 hereof.


 


11.11  NO GUARANTEES


 


Borrower
will not assume, guaranty, endorse or otherwise become directly or contingently
liable, or permit any of its subsidiaries to assume, guaranty, endorse, or
otherwise become directly or contingently liable (including, without
limitation, liable by way of agreement, contingent or otherwise, to purchase,
to provide funds for payment, to supply funds to or otherwise invest in any
debtor or otherwise to assure any creditor against loss) in connection with any
Debt of any other Person.


 


11.12 CORPORATE LOANS


 


Subject
to Section 11.04, the Borrower agrees that it shall neither make any
loans,  nor investments in other
corporations, business entities or to any other Persons, until all Obligations
are fully paid.


 


11.13 ADVERSE TRANSACTIONS


 


The
Borrower shall not enter into any transaction which adversely affects the
Collateral or its ability to repay the Obligations in full as and when due.


 


11.14  PREPAYMENT


 


The
Borrower shall not prepay any Debt other than the Obligations, except in the
ordinary course of business and to the extent that it does not have a material
adverse effect on the financial condition of the Borrower.


 


11.15 AFFILIATE TRANSACTIONS


 


Excluding
distributions to the sole member where no Event of Default has occurred or will
occur after giving effect to the distribution, the Borrower shall not, sell,
transfer, distribute or pay any money or property to any Affiliate or invest in
(by capital contribution or otherwise) or purchase or repurchase any stock or
debt, or any property, of any Affiliate, or become liable on any guaranty of
the indebtedness, dividends or other obligation of any Affiliate.


 


40

















 


12.00 CONDITIONS TO INITIAL ADVANCE


 


The
obligation of the Lender to make the initial Advance shall be subject to the satisfaction
of the following conditions precedent:


 


12.01 LOAN DOCUMENTS


 


Each
of the Loan Documents shall have been duly executed and delivered by the
respective parties thereto, shall be in full force and effect and shall be in
form and substance satisfactory to the Lender. The Lender shall have received a
fully executed copy of each such document.


 


12.02 CONSTRUCTION DOCUMENTS


 


Each
of the Architect’s Contract and Construction Contract shall have been duly
executed and delivered by the respective parties thereto, shall be in full
force and effect, and shall be in form and substance satisfactory to the
Lender. The Lender shall have received a certified or a fully executed copy of
each such document. The Borrower’s Architect and the Contractor shall have duly
executed and delivered to the Lender a consent to the assignment of the
Architect’s Contract and the Construction Contract, in form and substance
satisfactory to the Lender, and the Lender shall have received a fully executed
copy thereof.


 


12.03 SUBCONTRACTS


 


The
Borrower shall have delivered to the Lender, and the Lender shall have
approved, a list of all subcontractors and materialmen who have been or, to the
extent identified by the Borrower, will be supplying labor or materials for the
Project, a copy of the standard form of subcontract to be used by the
Contractor, and correct and complete photocopies of all executed subcontracts
and contracts.


 


12.04 OTHER CONTRACTS


 


The
Borrower shall have delivered to the Lender correct and complete photocopies of
all other executed contracts with contractors, engineers or consultants for the
Project, the Project Budget, and of all development, management, brokerage,
sales or leasing agreements for the Project.


 


12.05 EQUITY INFUSION


 


Borrower
shall have contributed its equity into the Project and the amount of the loan,
less the Interest Reserve is sufficient to fully build out the Project in
accordance with the Budget.


 


12.06 CERTIFIED COPIES OF ORGANIZATION DOCUMENTS


 


The
Lender shall have received from the Borrower, a copy, certified as of a recent
date by the appropriate officer of the State in which the Borrower is
organized, to be true and complete, of its operating agreement and any other of
its organization documents as in effect on such date of certification.


 


12.07 RESOLUTIONS


 


All
action necessary for the valid execution, delivery and performance by the
Borrower of this Agreement and the other Loan Documents to which it is or is to
become a party shall have been duly and effectively taken, and evidence thereof
satisfactory to the Lender shall have been provided to the Lender. The Lender
shall have received from the Borrower, true copies of the resolutions adopted
by its members authorizing the transactions described herein, each certified as
of a recent date to be true and complete.


 


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12.08 INCUMBENCIES CERTIFICATE; AUTHORIZED SIGNERS


 


The
Lender shall have received from the Borrower and each of its members, an
incumbency certificate, dated as of the Closing Date, signed by a duly
authorized members of the Borrower and giving the name and bearing a specimen
signature of each individual who shall be authorized: (a) to sign, in the
name and on behalf of the Borrower, each of the Loan Documents to which such
Person is or is to become a party; (b) in the case of the Borrower, to
make Draw Requests; and (c) to give notices and to take other action on
its behalf under the Loan Documents.


 


12.09 VALIDITY OF LIENS


 


The
Security Documents shall be effective to create in favor of the Lender a legal,
valid and enforceable first lien and security interest in the Collateral and
first mortgage on the Project. All filings, recordings, deliveries of
instruments and other actions necessary or desirable in the opinion of the Lender
to protect and preserve such lien and security interest shall have been duly
effected. The Lender shall have received evidence thereof in form and substance
satisfactory to the Lender.


 


12.10   DELIVERY OF DOCUMENTS


 


The
following items or documents shall have been delivered to the Lender by the
Borrower and shall be in form and substance satisfactory to the Lender:


 


(a) Plans
and Specifications. Two complete sets of the Plans and Specifications and
approval thereof by any necessary Governmental Authority, with a certification
from the Borrower’s Architect that the Improvements to be constructed comply
with all Requirements and Project Approvals.


 


(b) Title
Policy. The Title Policy, together with proof of payment of all fees and
premiums for such policy and true and accurate copies of all documents listed
as exceptions under such policy.


 


(c) Other
Insurance. Duplicate originals or certified copies of all policies of
insurance required by the Mortgage to be obtained and maintained by the
Borrower during the construction of the Improvement; provided, however, at the
Closing, Binders of insurance policies and/or Certificates of Insurance will be
provided.  Photocopies will be delivered
within fifteen (15) days following the Closing, and certificates of insurance
evidencing the insurance required by Sections 10.09(b) and (c) to be
obtained and maintained by the Contractor and the Borrower’s Architect.


 


(d) Evidence
of Sufficiency of Funds.  Evidence
that the proceeds of the Construction Loan, together with the Required Equity
Funds delivered to the Lender on the Closing Date, will be sufficient to cover
all Project Costs reasonably anticipated to be incurred to complete the
Improvements prior to the Completion Date, to carry the Project through the
Maturity Date and to satisfy the obligations of the Borrower to the Lender
under this Agreement.


 


(e) Evidence
of Access, Availability of Utilities, Project Approvals.  Evidence as to:


 


(i) the
methods of access to and egress from the Project, and nearby or adjoining public
ways, meeting the reasonable requirements of the Project and the status of
completion of any required improvements to such access;


 


(ii) the
availability of water supply and storm and sanitary sewer facilities meeting
the reasonable requirements of the Project;


 


(iii) the
availability of all other required utilities, in location and capacity
sufficient to meet the reasonable needs of the Project; and


 


(iv) the
obtaining of all Project Approvals which are required, necessary or desirable
for the construction of the Improvements and the access thereto, together with
copies of all such Project Approvals.


 


42

















 


(f) Environmental
Report. An environmental site assessment report or reports of one or more
qualified environmental engineering or similar inspection firms approved by the
Lender, which report or reports shall indicate a condition of the Land and any
existing improvements thereon in all respects satisfactory to the Lender in its
sole discretion and upon which report or reports the Lender is expressly
entitled to rely.


 


(g) 
Soils Report.  A soils report for
the Land prepared by a soils engineer approved by the Lender, which report
shall indicate that, based upon actual surface and subsurface examinations of
the Land, the soils conditions are fully satisfactory for the proposed
construction and operation of the Improvements in accordance with the Plans and
Specifications.


 


(h) Surveys
and Taxes. A Survey of the Land (and any existing improvements thereon) and
Surveyor’s Certificate, and evidence of payment of all real estate taxes and
municipal charges on the Land (and any existing improvements thereon) which
were due and payable prior to the Closing Date.


 


(i) Draw
Request. A Draw Request complying with the provisions of Section 3.01
hereof.


 


12.11  [RESERVED]


 


12.12 CONSTRUCTION INSPECTOR REPORT


 


The
Lender shall have received a report or written confirmation from the
Construction Inspector that (a) the Construction Inspector has reviewed
the Plans and Specifications, (b) the Plans and Specifications have been
received and approved by each Governmental Authority to which the Plans and
Specifications are required under applicable Requirements to be submitted, (c) the
Construction Contract satisfactorily provides for the construction of the
Improvements, and (d) in the opinion of the Construction Inspector,
construction of the Improvements can be completed on or before the Completion
Date for an amount not greater than the amount allocated for such purpose in the
Project Budget.


 


12.13 LEGAL OPINIONS


 


The
Lender shall have received favorable opinions in form and substance
satisfactory to the Lender and the Lender’s counsel, addressed to the Lender
and dated as of the Closing Date, from Borrower’s legal counsel, opining to
those matters described on Exhibit “R”.


 


12.14 LIEN SEARCH


 


The
Lender shall have received a certification from Title Insurance Company or
counsel satisfactory to the Lender (which shall be updated from time to time at
the Borrower’s expense upon request by the Lender) that a search of the public
records disclosed no conditional sales contracts, security agreements, chattel
mortgages, leases of personalty, financing statements or title retention
agreements which affect the Collateral.


 


12.15 NOTICES


 


All
notices required by any Governmental Authority under applicable requirements to
be filed prior to commencement of construction of the Improvements shall have
been filed.


 


12.16 APPRAISAL


 


The
Lender shall have received an Appraisal, in form and substance satisfactory to
the Lender, stating that the Project, assuming completion in accordance with
the Plans and Specifications, has a fair market value of at least Seventeen
Million One Hundred Forty Two Thousand Eight Hundred Fifty Seven and 00/100 Dollars
($17,142,857.00).


 


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12.17 PERFORMANCE; NO DEFAULT


 


The
Borrower shall have performed and complied with all terms and conditions herein
required to be performed or complied with by it on or prior to the Drawdown
Date of the initial Advance, and on the Drawdown Date of the initial Advance,
there shall exist no Default or Event of Default.


 


12.18 REPRESENTATIONS AND WARRANTIES


 


The
representations of warranties of the Borrower and the Guarantor in the Loan
Documents or otherwise made by or on behalf of the Borrower or the Guarantor in
connection therewith or after the date thereof shall have been true and correct
in all material respects when made and shall be true and correct in all
material respects on the Drawdown Date of the initial Advance.


 


12.19 PROCEEDINGS AND DOCUMENTS; COSTS


 


All
proceedings in connection with the transactions contemplated by this Agreement
and the other Loan Documents shall be satisfactory to the Lender and the Lender’s
counsel in form and substance, and the Lender shall have received all
information and such counterpart originals or certified copies of such
documents and such other certificates, opinions or documents as the Lender and
the Lender’s counsel may reasonably require. The Borrower shall reimburse
Lender on demand for all reasonable costs and expenses incurred by Lender in
connection with the Construction Loan, including, without limitation, legal,
engineering, inspection and appraisal fees.


 


12.20   LEASES/SUBORDINATION
AGREEMENTS AND ESTOPPELS


 


Certified
copies of all Leases, together with a Subordination, Nondisturbance and Attornment
Agreements executed by the Primary Tenant located at the Mortgaged Premises as
are required by the title company in order to confirm that no Lease has
priority over the Mortgage all as more fully described in Exhibit S.”


 


12.21 LICENSES, PERMITS AND APPROVALS


 


A
copy of the final unconditional Certificate of Occupancy (“CO”) issued with
respect to the Mortgaged Premises if (a CO has been issued and is reasonably
available from the City authorities), together with such other applicable
licenses, permits and approvals as Lender or any governmental authority may
require.


 


13.00 CONDITIONS OF SUBSEQUENT ADVANCES


 


The
obligation of the Lender to make any Advance after the initial Advance shall be
subject to the satisfaction of the following conditions precedent:


 


13.01 PRIOR CONDITIONS SATISFIED


 


All
conditions precedent to the initial Advance and any prior Advance shall
continue to be satisfied as of the Drawdown Date of such subsequent Advance.


 


13.02 PERFORMANCE; NO DEFAULT


 


The
Borrower shall have performed and complied with all terms and conditions herein
required to be performed or complied with by it on or prior to the Drawdown
Date of such Advance, and on the Drawdown Date of such Advance there shall
exist no Default or Event of Default.


 


44

















 


13.03 REPRESENTATIONS AND WARRANTIES


 


Each
of the representations and warranties made by the Borrower in the Loan
Documents or otherwise made by or on behalf of the Borrower and/or Guarantor in
connection therewith after the date thereof shall have been true and correct in
all respects on the date on when made and shall also be true and correct in all
material respects on the Drawdown Date of such Advance (except to the extent of
changes resulting from transactions contemplated or permitted by the Loan
Documents and changes occurring in the ordinary course of business that singly
or in the aggregate are not adverse).


 


13.04 NO DAMAGE


 


The
Improvements shall not have been injured or damaged by fire, explosion,
accident, flood or other casualty.


 


13.05 RECEIPT OF LENDER


 


The
Lender shall have received:


 


(a) Draw
Request. A Draw Request complying with the requirements hereof, including
those set forth in Section 3.01 hereof;


 


(b) Endorsement
to Title Policy. A “date down” endorsement to the Title Policy indicating
no change in the state of title and containing no survey exceptions not
approved by the Lender, which endorsement shall, expressly or by virtue of a
proper “pending disbursements” clause of endorsement in the Title Policy,
increase the coverage of the Title Policy to the aggregate amount of all
proceeds of the Construction Loan advanced on or before the effective date of
such endorsement, and prior to the final advance, an endorsement which confirms
that the Project is located as set forth in the “as built” survey.


 


(c) Current
Survey. An updated Survey if required by the Title Insurance Company or the
Lender and prior to the last advance, an “as built”  survey;


 


(d) Approval
by Construction Inspector. Approval of the Draw Request for such Advance by
the Construction Inspector, accompanied by a certificate or report from the
Construction Inspector to the effect that in its opinion, based on on-site
observations and submissions by the Contractor, the construction of the
Improvements to the date thereof was performed in a good and workmanlike manner
and in accordance with the Plans and Specifications, stating the estimated
total cost of construction of the Improvements, stating the percentage of
in-place construction of the Improvements, and stating that the remaining
non-disbursed portion of the Construction Loan and Required Equity Funds
allocated for such purpose in the Project Budget is adequate to complete the
construction of the Improvements;


 


(e) 
Approval by Lender.  At the option
of the Lender, inspection of work in place;


 


(f) Contracts.
Evidence that one hundred percent (100%) of the cost of the remaining
construction work is covered by firm fixed price or guaranteed maximum price
contracts or subcontracts, or orders for the supplying of materials, with
contractors, subcontractors, materialmen or suppliers satisfactory to the
Lender; and


 


(g) Change
Orders. Documentation to the effect that the Borrower has paid for the cost
of any change orders relating to the Project.


 


14.00 SECURITY INTEREST


 


Borrower, for valuable consideration received, hereby
pledges, assigns, transfers and grants to Lender a continuing lien and security
interest in all tangible and intangible personal property of Borrower (whether
now existing or hereafter acquired or arising, and wherever located) upon,
concerning or in any way relating to, or unrelated to, the Mortgaged Premises,
including, without limitation, (i) all fixtures, machinery, equipment,
furniture, inventory, building supplies, appliances and other personal
property, including, but not limited to, furnaces, ranges, heaters, plumbing
goods, gas and electric fixtures, screens, screen doors, mantels, shades, storm
doors and windows, 


 


45

















 


awnings, oil burners and tanks, gas or electric
refrigerators and refrigerating systems, ventilating and air conditioning
apparatus and equipment, doorbell and alarm systems, sprinkler and fire
extinguishing systems, portable or sectional buildings, and all other fixtures
and equipment of whatever kind or nature now or hereafter located in or on the
Mortgaged Premises, or used or intended to be used in connection with the use,
operation, construction or enjoyment of the Mortgaged Premises, all of which
shall be deemed fixtures and a part of the Mortgaged Premises as between the
parties hereto and all persons claiming by, through or under them, (ii) all
leases, contracts or agreements relating to the lease, rental, hire or use by
Borrower of any of the aforementioned personal property, (iii) all leases,
tenancies, occupancies and license arrangements heretofore or hereafter entered
into affecting the use, enjoyment or occupancy of or the conduct of any
activity upon or in to the Mortgaged Premises or any portion thereof, and all
guaranties and security relating thereto (individually, a “Lease” and
collectively, the “Leases”), (iv)  all rents, issues, profits and other
benefits from the Mortgaged Premises, any of the personal property described
herein, and any of the leases, tenancies, occupancies, license arrangements and
rental agreements relating thereto, (v) all contracts, agreements, accounts,
chattel paper, general intangibles, licenses, rights, permits and approvals,
privileges, warranties and representations relating to the ownership, use,
operation, management, construction, repair or service of any of the Mortgaged
Premises or personal property described herein, (vi) any and all
agreements to sell the Mortgaged Premises or any portion thereof, (vii) all
funds held by Lender as tax or insurance escrow payments or for other purposes,
(viii) all insurance policies and all proceeds or unearned insurance
premiums relating thereto, (ix) all claims, awards, damages or proceeds
resulting from any condemnation or other taking of, or for any damage to, any
of the Mortgaged Premises or personal property described herein, (x) all
claims to rebates, refunds or abatements of any property taxes relating to any
of the Mortgaged Premises or personal property described herein, (xi) all
construction contracts, subcontracts, architectural agreements, labor, material
and payment bonds, guaranties and warranties, and plans and specifications
relating to the construction of improvements upon the Mortgaged Premises, (xii) all
proceeds, products, substitutions and accessions to any of the foregoing,
together with, and whether or not related to the Mortgaged Premises, and all
machinery, equipment, goods, inventory, accounts, including health care
insurance receivables, chattel paper, general intangibles, including payment
intangibles and amounts owed by other than customers, regardless of whether or
not they constitute proceeds of other collateral; all chose-in-action, cash,
cash deposits, deposit accounts, investment property, including without
limitation, securities, stocks, bonds, 
warrants, options, documents, documents of title, instruments, including
promissory notes, deposits, debts, refunds, letter of credit rights, supporting
obligations,  policies and certificates
of insurance, obligations and liabilities in whatever form owing from any
person, corporation, or other legal entity; all books, records, evidences of
title, goodwill and all papers relating to the operation of the Borrower’s
business; all federal, state, and local tax refunds and/or abatements and any
loss carryback tax refunds; all patents, patents rights, trade secrets,
know-how, trademarks, trade names, logos, registrations, customer lists,
computer programs, and assignments of patents all intellectual property as
defined in 11 USC 101 (53) to the extent that such intellectual property is
assignable; all fixtures, real estate leases, any and all equipment leases,
rentals and other sums payable thereunder, other chattel paper, purchase option
payments, lessor’s interest in leased equipment and insurance proceeds; any
licenses or interests in real estate; all liens, guarantees, securities,
rights, remedies and privileges pertaining to all of the foregoing, all
property allocable to unshipped orders and all merchandise returned by or
reclaimed by or repossessed from customers, all rights of stoppage in
transit, replevin, repossession and reclamation and all other rights of an
unpaid vendor or lienor; and all interest of the Borrower in goods or
merchandise as to which an account receivable for goods sold or delivered has
arisen;


 


And
all of the above, wherever located, whether now owned or now due or hereafter
arising or acquired or coming due and including the products and proceeds
thereof (if any) and all accessions and additions thereto and all replacements
and substitutions therefore, cash and stock dividends (if applicable), and all
proceeds of credit, fire, casualty, or other insurance upon said property, or
any of the above which are acquired with any cash proceeds or other
collateral.  The term “proceeds” shall
include, without limitation, all types or classifications of non-cash proceeds
acquired with cash proceeds (all of the foregoing shall collectively be
referred to as the “Collateral”).


 


14.01  The security
interest granted hereby is to secure payment and performance of all Obligations
from Borrower to Lender, together with all interest, fees, charges and expenses
including the reasonable expenses of the Lender’s counsel in the maintaining,
foreclosing and selling of any of the Collateral.


 


14.02  IT IS THE
TRUE, CLEAR, AND EXPRESS INTENTION OF THE Borrower that the continuing grant of
this security interest remain as security for payment and performance of all
Obligations, whether now existing, or which may hereinafter be incurred by
future advances, or otherwise; and whether, or not, such obligation 


 


46

















 


is
related to the transaction described in this Agreement, by class, or kind, or
whether or not contemplated by the parties at the time of the granting of this
security interest.  The notice of the
continuing grant of this security interest therefore shall not be required to
be stated on the face of any document representing any such obligation, nor
otherwise identified it as being secured hereby.


 


15.00 EVENTS OF DEFAULT AND REMEDIES


 


15.01 EVENTS OF DEFAULT


 


The
occurrence of any one or more of the following conditions or events shall
constitute an “Event of Default”:


 


(a) any
failure by the Borrower to pay when due and payable any interest on or
principal of or other sum payable under the Construction Note; or


 


(b) any
failure by the Borrower following five (5) days notice from Lender to
Borrower to deposit with the Lender any funds required by Section 10.16
hereof to be deposited with the Lender, at the time and otherwise in accordance
with Section 10.16; or


 


(c) any
failure by the Borrower following five (5) days notice from Lender to
Borrower to pay as and when due and payable any other sums to be paid by the
Borrower to the Lender under this Agreement or any of the Loan Documents; or


 


(d) title
to the Collateral is or becomes unsatisfactory to the Lender by reason of any
lien, charge, encumbrance, title condition or exception (including without
limitation, any mechanic’s, materialmen’s or similar statutory or common law
lien or notice thereof), and such matter causing title to be or become unsatisfactory
is not cured or removed (including by bonding) within thirty (30) days after
notice thereof from the Lender to the Borrower; or


 


(e) any
refusal by the Title Insurance Company to insure any Advance as being secured
by the Mortgage as a valid first lien and security interest on the Project and
continuance of such refusal for a period of thirty (30) days after notice
thereof by the Lender to the Borrower; or


 


(f) the
Improvements are not completed by the Completion Date or, in the reasonable
judgment of the Lender, construction of the Improvements will not be completed
by the Completion Date; or


 


(g) the
Project or any part thereof is injured by fire, explosion, accident, flood or
other casualty, provided, however, no Event of Default under this Agreement or
any of the Loan Documents has occurred, and there are sufficient insurance
proceeds to restore the Project and the cost to remedy the casualty is less
then available insurance proceeds then, in this case, this Section 15.01(g) shall
not constitute an Event of Default; or


 


(h) the
Project or any part thereof is subject to a Taking, provided, however, Lender
agrees to allow payments to be made in accordance with the terms of the
Mortgage


 


;
or


 


(w) any
of the members of the Borrower and/or any Guarantor shall be convicted for a
federal crime, a punishment for which could include the forfeiture of any of
its assets; or


 


(x) any
failure by the Borrower and/or any Guarantor to duly observe or perform any
other term, covenant, condition or agreement under this Agreement and
continuance of such failure for a period of thirty (30) days after notice
thereof from the Lender; or


 


15.02 TERMINATION OF COMMITMENT AND ACCELERATION


 


If
any one or more of the Events of Default shall occur, the Lender may declare its
obligations to make Advances hereunder to be terminated, whereupon the same
shall terminate and the Lender shall be relieved of all


 


47

















 


obligations
to make Advances to the Borrower, and/or declare all unpaid principal of and
accrued interest on the Construction Note, together with all other amounts
owing under the Loan Documents, to be immediately due and payable, whereupon
same shall become and be immediately due and payable, and without presentment,
protest, demand or other notice of any kind, all of which are hereby expressly
waived by the Borrower.


 


15.03 COMPLETION OF PROJECT


 


If
any one or more of the Events of Default shall have occurred and continue past
any applicable grace period,  and whether
or not the Lender shall have terminated its obligations to make Advances and
accelerated the maturity of the Construction Loan pursuant to Section 15.02,
the Lender, if the construction of the Improvements has not been fully
completed, may cause the Project to be completed and may enter upon the Land
and construct, equip and complete the Project in accordance with the Plans and
Specifications, with such changes therein as the Lender may, from time to time,
and in its sole discretion, deem appropriate. In connection with any
construction of the Project undertaken by the Lender pursuant to the provisions
of this Section 15.03, the Lender may:


 


(a) use
any funds of the Borrower, including any balance which may be held by the
Lender as security or in escrow, and any funds remaining unadvanced under the
Construction Loan;


 


(b) employ
existing contractors, subcontractors, agents, architects, engineers, and the
like, or terminate the same and employ others;


 


(c) employ
security watchmen to protect the Project;


 


(d) make
such additions, changes and corrections in the Plans and Specifications as
shall, in the judgment of the Lender, be necessary or desirable;


 


(e) take
over and use any and all Personal Property contracted for or purchased by the
Borrower, if appropriate, or dispose of the same as the Lender sees fit;


 


(f) execute
all applications and certificates on behalf of the Borrower which may be
required by any Governmental Authority or Requirements or contract documents or
agreements;


 


(g) pay,
settle or compromise all existing or future bills and claims which are or may
be liens against the Project, or may be necessary for the completion of the
Improvements or the clearance of title to the Project;


 


(h) complete
the marketing and leasing of leasable space in the Improvements, enter into new
Leases, and modify or amend existing Leases, all as the Lender shall deem to be
necessary or desirable;


 


(i) prosecute
and defend all actions and proceedings in connection with the construction of
the Improvements or in any other way affecting the Land; and


 


(j) take
such action hereunder, or refrain from acting hereunder, as the Lender may, in
its sole and absolute discretion, from time to time determine, and without any
limitation whatsoever, to carry out the intent of this Section 15.03.


 


The
Borrower shall be liable to the Lender for all costs paid or incurred for the
construction, equipping and completion of the Project, whether the same shall
be paid or incurred pursuant to the provisions of this Section 15.03 or
otherwise, and all payments made or liabilities incurred by the Lender
hereunder of any kind whatsoever shall be deemed Advances made to the Borrower
under this Agreement and shall be secured by the Mortgage and the other
Security Documents. To the extent that any costs so paid or incurred by the
Lender, together with all other Advances made by the Lender hereunder, exceed
the Construction Loan Amount, the amount of such excess costs shall be added to
the Construction Loan Amount, and the Borrower’s obligation to repay the same,
together with interest thereon at the Default Rate, shall be deemed to be
evidenced by this Agreement and secured by the Mortgage and the other Security
Documents. In the event the Lender takes possession of the Project and assumes
control of such construction as aforesaid, it shall not be obligated to
continue such construction longer than it shall see fit and may 


 


48

















 


thereafter,
at any time, change any course of action undertaken by it or abandon such
construction and decline to make further payments for the account of the
Borrower whether or not the Project shall have been completed. For the purpose
of this Section 15.03, the construction, equipping and completion of the
Project shall be deemed to include any action necessary to cure any Event of
Default by the Borrower under any of the terms and provisions of any of the
Loan Documents.


 


15.04 OTHER REMEDIES


 


If
any one or more of the Events of Default shall have occurred, and whether or
not the Lender shall have terminated its obligations to make Advances or
accelerated the maturity of the Construction Loan pursuant to Section 15.02,
the Lender may proceed to protect and enforce its rights and remedies under
this Agreement, the Construction Note or any of the other Loan Documents by
suit in equity, action at law or other appropriate proceeding, whether for the
specific performance of any covenant or agreement contained in this Agreement
and the other Loan Documents or any instrument pursuant to which the
Obligations are evidenced, including as permitted by applicable law the
obtaining of the ex parte appointment of a receiver, and, if any amount owed to
the Lender shall have become due, by declaration or otherwise, proceed to
enforce the payment thereof or any other legal or equitable right of the
Lender. No remedy conferred upon the Lender or the holder of the Note in this
Agreement or in any of the other Loan Documents is intended to be exclusive of
any other remedy and each and every remedy shall be cumulative and shall be in
addition to every other legal or equitable right of the Lender. No remedy
conferred upon the Lender or the holder of the Construction Note in this
Agreement or in any of the other Loan Documents is intended to be exclusive of any
other remedy and each and every remedy shall be cumulative and shall be in
addition to every other remedy given hereunder or thereunder or now or
hereafter existing at law or in equity or by statute or any other provision of
law.


 


15.05 RIGHTS AS TO COLLATERAL


 


Upon
the occurrence of an Event of Default and after any applicable grace period,
and at any time thereafter, in addition to other rights and remedies the Lender
has under this Agreement, the Lender may:


 


15.05.1  Notify
account debtors at Borrower’s expense, that the Collateral has been assigned to
Lender and that payments shall be made directly to Lender and upon request of
Lender, Borrower will so notify such account debtor that their accounts must be
paid to Lender.  This right may be
exercised by the Lender at any time, even prior to default.  Borrower will immediately upon receipt of all
checks, drafts, cash and other remittances deliver the same in kind to the
Lender. Lender shall have full power to collect, compromise, endorse, sell or
otherwise deal with the Collateral or proceeds thereof in its own name or in
the name of Borrower and Borrower hereby, for consideration paid, irrevocably
appoints the Lender its attorney-in-fact for this purpose.


 


15.05.2  Without
notice to Borrower, enter and take possession of all Collateral and the Project
on which they are now or hereafter located, including without limitation,
breaking the close and changing and replacing locks as may be required without
the same being considered as a trespass, as Borrower hereby expressly provides
authority for the same.  The Lender, at
its sole discretion, may operate and use Borrower’s equipment, complete work in
process and sell inventory without being liable to the Borrower on account of
any losses, damage or depreciation that may occur as a result thereof so long
as Lender shall act reasonably and in good faith and may lease or license the
Collateral to third persons or entities for such purposes; and in any event,
Lender may at its option and without notice to Borrower, except as specifically
herein provided, sell, lease, assign and deliver, the whole or any part of the
Collateral, or any substitute therefore, or any addition thereto, at public or
private sale, for cash, upon credit, or for future delivery, at such prices and
upon such terms as Lender deems advisable, including without limitation the
right to sell or lease in conjunction with other property, real or personal,
and allocate the sale proceeds or leases among the items of property sold
without the necessity of the Collateral being present at any such sale, or in
view of prospective purchasers thereof. 
Lender shall give Borrower timely notice by hand delivery to Borrower or
by United States mail, postage prepaid (in which event notice shall be deemed
to have been given when so deposited in the mail), at the address specified
herein, of the time and place of any public or private sale or other
disposition unless the Collateral is perishable, threatens to decline speedily
in value, or is the type customarily sold in a recognized market.  Upon such sale, Lender may become the
purchaser of the whole or any part of the Collateral sold, discharged from all
claims and free from any right of redemption. 
In case of any such sale by


 


49
















 


Lender
of all or any of said Collateral on credit, or for future delivery, such
property so sold may be retained by Lender until the selling price is paid by
the purchaser.  The Lender shall incur no
liability in case of the failure of the purchaser to take up and pay for the
Collateral so sold.  In case of any such
failure, the said Collateral may be again, from time-to-time, sold.


 


15.05.3. Continue to
occupy and use all premises which the Borrower now occupies or may hereafter
have or occupy, to the extent Borrower could legally do so, and may use all
trademarks, service marks, trade names, trade styles, logos, goodwill, trade
secrets, franchises, licenses and patents which the Borrower now has or may
hereafter acquire, including the following rights:


 


(i)  the rights in said marks, name, styles, logos and goodwill
acquired by the common law of the United States or of any state thereof or
under the law of any foreign nation, organization, or subdivision thereof;


 


(ii)  the rights acquired by registrations of said marks, names,
styles, and logos under the statute of any foreign country, or the United
States, or any state or subdivision thereof;


 


(iii)  the rights acquired in each and every form of said mark,
name, style and logo as used by the Borrower notwithstanding that less than all
of such forms would be registered and notwithstanding the form of said mark,
name and style;


 


(iv)  the right to use or license any party to the use of all or
any of said marks, names, styles, logos and goodwill in connection with the
sale of goods and/or the rendering of services in the conduct of services
advertising, promotion and the like anywhere in the world;


 


(v) 
the right to use said marks, names, styles, logos and goodwill either in
connection with or entirely independent from the Collateral;


 


(vi)  the right to assign, transfer and convey a partial interest
or the entire interest in any one or more of said marks, names, styles or
logos;


 


(vii) 
the right to seek registration, foreign or domestic, of any of said marks,
names, styles or logos which was not registered as of the date hereof or
registered subsequently;


 


(viii)  the right to prosecute pending trademark applications for
foreign or domestic registration (federal or state) of any of said marks,
names, styles or logos.


 


15.05.4  Act as
attorney-in-fact for Borrower for the purposes herein described, and Borrower
does hereby make, constitute and appoint any officer or agent of Lender as
Borrower’s true and lawful attorney-in-fact, with full power: to endorse the name
of Borrower or any of Borrower’s officers or agents upon any assignments,
notes, checks, drafts, money orders, or other instruments of payment or
Collateral that may come into possession of Lender for purposes of such
recovery of accounts receivable monies; to sign and endorse the name of
Borrower or any of Borrower’s officers or agents upon any negotiable
instrument, invoice, freight or express bill, bill of lading, storage or
warehouse receipts, drafts, assignments, verifications and notices in connection
with accounts, and any instruments or documents relating thereto or to Borrower’s
rights therein; to give notice to the United States Post Office to effect
changes of address so that mail addressed to the Borrower may be permanently
delivered directly to the Lender for purposes of accepting same, and obtaining
access to contents, in order to take possession of such accounts receivable
monies, and all other collateral, with full power to do any and all things
necessary to be done in and about the premises as fully and effectually as
Borrower might or could do; and Borrower does hereby ratify all that Lender
shall lawfully do, or cause to be done by virtue hereof.


 


15.05.5  Make all
Obligations immediately due and payable, without presentment, demand, protest,
hearing or notice of any kind and exercise the remedies of a Lender afforded by
the Uniform Commercial Code and other applicable law or by the terms of any
agreement between Borrower and Lender.


 


50

















 


15.05.6  In the case
of any sale or disposition of the Collateral, or the realization of funds
therefrom, the proceeds thereof shall first be applied to the payment of the
reasonable expenses of re-taking, maintaining, and foreclosure of Collateral,
and costs, fees and expenses of such sale, commissions, reasonable attorney’s
fees and all charges paid or incurred by Lender pertaining to said sale,
including any taxes or other charges imposed by law upon the Collateral and/or
the owning, holding or transferring thereof; secondly, to pay, satisfy, and
discharge the Obligations secured hereby pro rata in accordance with the unpaid
amount thereof; and thirdly, to pay the surplus, if any, to Borrower, provided
that the time of any application of the proceeds shall be at the sole and
absolute discretion of the Lender.  To
the extent such proceeds do not satisfy the foregoing items, Borrower hereby
promises and agrees to pay the deficiency.


 


15.05.7  The Lender
and the holders of the Obligations may take or release other security, may
release any party primarily or secondarily liable for any of the Obligations,
may grant extensions, renewals or indulgences with respect to the Obligations,
or may apply to the Obligations the proceeds of the Collateral or any amount received
on account of the Collateral by the exercise of any right permitted hereunder,
without resorting or regard to other security or sources of reimbursement.


 


15.05.8  Require the
Borrower to assemble the Collateral in a single location at a place to be
designated by Lender and make the Collateral at all times secure and available
to the Lender.


 


15.05.9  The Lender
shall hereby also be granted a security interest in, and right of set off
against any balance on any deposit, deposit account, agency, reserve, holdback,
or other account maintained by, or on behalf of, the Borrower with the Lender
and the Lender shall have the right to apply the proceeds of such foreclosure
or set off against such items of Borrowers’ Obligations as Lender may select.


 


15.05.10 All rights and remedies of Lender whether provided
for herein or in other agreements, instruments, or documents, or conferred by
law, are cumulative and not alternative and may be enforced successively.


 


15.05.11 The parties agree that in the event that a
determination of Adequate Protection of Lender is required under Section 362
or 363 of the Bankruptcy Reform Act of 1978 (Code), its successor, or
Bankruptcy Rules in connection therewith, that:


 


A.  The bargain of the parties at the time of
lien creation hereunder in order to provide the Lender with adequate protection
to induce it to make the loan(s), included stated ratios herein.


 


B.  That in the event of any proceeding under the
Code, that the said ratio of the value (as determined by the Lender in its sole
discretion) Collateral secured to Lender to the amount of the Obligation (“Collateral-To-Obligation
Ratio”), must be increased by an additional one hundred ten percent (110%) in
order to continue to provide minimum levels of Adequate Protection to Lender
due to the reduced expectation for present and future prospects of lien
enforcement resulting from the existence of proceedings under the Code.  This agreed minimum increase in said ratio
shall not act to bar Lender from presenting evidence that even such increase is
insufficient and leaves the Lender without Adequate Protection, based upon the
deteriorating nature or kind of Collateral, wholly or in part, in any instance.


 


C.  That the parties agree that the costs of
liquidating and collecting of Collateral, as well as the potential for rapid
Collateral deterioration if Borrower is, at any time, subject to the Code, all
require that the original Collateral-To-Obligation Ratio be increased, as
aforesaid, as a requirement of minimum Adequate Protection, in addition to such
other additional Adequate Protection as may be required by the Lender.


 


D.  The parties agree that these covenants shall
be conclusive evidence in any proceeding to determine minimum Adequate
Protection under the Code, as to the intention and agreement of the parties at
both this time, and at all times hereinafter, until the Obligations to the
Lender, are paid in full.


 


51

















 


E.  That these agreements may be submitted to the
Court in any such proceeding, by the Lender, in its sole and exclusive
discretion, as conclusive evidence as to the agreement of the parties at the
time of such hearing, concerning minimum Adequate Protection to be provided to
the Lender at the time of presentment. 
PROVIDED, HOWEVER, that such submission shall not constitute a waiver of
any default or breach hereunder, or of any other agreement by the Borrower to
the Lender, but shall remain only as evidence for the limited purposes stated
herein.


 


F.  PROVIDED, FURTHER that at all times the
Lender reserves, and does not waive Borrower’s obligation to provide Adequate
Protection prior to the Borrower’s use of “cash collateral” as defined in Section 363
of the Code.


 


15.05.12   The Lender
has no obligation to attempt to satisfy the Obligations by collecting from any
other Person liable for them and Lender may release, modify or waive any
Collateral provided by any other Person to secure any of the Obligations, all
without affecting Lender’s rights against Borrower.  Borrower waives any right it may have to
require Lender to pursue any third Person for any of the Obligations.


 


15.05.13  Lender may
comply with any applicable state or federal law requirements in connection with
a disposition of the Collateral and compliance will not be considered adversely
to affect the commercial reasonableness of any sale of the Collateral.


 


15.05.14  Lender may sell
the Collateral without giving any warranties as to the Collateral.  The Lender may specifically disclaim any
warranties of title or the like.  This
procedure will not be considered adversely to affect, the commercial
reasonableness of the sale of the Collateral.


 


15.05.15  If Lender
agrees with a purchaser to sell the Collateral upon credit, Borrower will be
credited only with payments actually made by the purchaser, received by Lender
and applied to the indebtedness of the purchaser.  In the event that purchaser fails to pay for
the Collateral, Lender may resell the Collateral and Borrower shall be credited
with the net proceeds of the sale.


 


15.05.16  In the event
Lender purchases any of the Collateral being sold, Lender may pay for the
Collateral by crediting some or all of the Obligations of the Borrower.


 


15.05.17  Lender has no
obligation to marshall any assets in favor of Borrower or in payment of any of
the Obligations or any other obligations owed to Lender by Borrower or any
other person.


 


15.06 DISTRIBUTION OF COLLATERAL PROCEEDS


 


In
the event that, following the occurrence or during the continuance of any
Default or Event of Default, the Lender receives any monies in connection with
the enforcement of any the Security Documents, or otherwise with respect to the
realization upon any of the Collateral, such monies shall be distributed for
application as follows:


 


(a) First,
to the payment of, or (as the case may be) the reimbursement of the Lender for
or in respect of all reasonable costs, expenses, attorneys fees, disbursements
and losses which shall have been incurred or sustained by the Lender in
connection with the collection of such monies by the Lender,  for the exercise, protection or enforcement
by the Lender of all or any of the rights, remedies, powers and privileges of
the Lender under this Agreement or any of the other Loan Documents or in
respect of the Collateral or in support of any provision of adequate indemnity
to the Lender against any taxes or liens which by law shall have, or may have,
priority over the rights of the Lender to such monies;


 


(b) Second,
to all Obligations in such order or preference as the Lender may determine in
its sole discretion; provided, however, that the Lender may in its discretion
make proper allowance to take into account any Obligations not then due and
payable;


 


52

















 


(c) Third,
upon payment and satisfaction in full or other provisions for payment in full
satisfactory to the Lender of all of the Obligations, to the payment of any
obligations required to be paid pursuant to Article IX of the Uniform
Commercial Code of the Commonwealth of Massachusetts; and


 


(d) Fourth,
the excess, if any, shall be returned to the Borrower or to such other Persons
as are entitled thereto.


 


15.07 POWER OF ATTORNEY


 


For
the purposes of carrying out the provisions and exercising the rights,
remedies, powers and privileges granted by or referred to in this Section 15.07,
the Borrower hereby irrevocably constitutes and appoints the Lender its true
and lawful attorney-in-fact, with full power of substitution, to execute,
acknowledge and deliver any instruments and do and perform any acts which are
referred to in this Section 15.07, in the name and on behalf of the
Borrower. The power vested in such attorney-in-fact is, and shall be deemed to
be, coupled with an interest and irrevocable.


 


15.08 WAIVERS


 


The
Borrower hereby waives to the extent not prohibited by applicable law (a) all
presentments, demands for performance, notices of nonperformance (except to the
extent required by the provisions hereof or of any of the other Loan
Documents), protests and notices of dishonor, (b) any requirement of
diligence or promptness on the Lender’s part in the enforcement of its rights
(but not fulfillment of its obligations) under the provisions of this Agreement
or any of the other Loan Documents, and (c) any and all notices of every
kind and description which may be required to be given by any statute or rule of
law and any defense of any kind which the Borrower may now or here after have
with respect to its liability under this Agreement or under any of the other
Loan Documents.


 


16.00      FINANCING STATEMENTS


 


Prior
to any Advance the Borrower hereby agrees to execute, deliver, and pay the cost
of filing any financing statement, or other notices appropriate under
applicable law, in respect of any security interest created pursuant to this
Agreement or at any other time which may at any time be required or which, in
the opinion of the Lender, may at any time be desirable.  In the event that any re-recording or
re-filing thereof (or the filing of any statements of continuation or assignment
of any financing statement) is required to protect and preserve such lien or
security interest, the Borrower shall, at its cost and expense, cause the same
to be re-recorded and/or re-filed at the time and in the manner requested by
the Lender.  The Borrower hereby
irrevocably designates the Lender, its agents, representatives and designees as
agents and attorneys-in-fact for the Borrower to sign such financing
statements, or other instruments in connection herewith, on behalf of the
Borrower and file the same, as required.


 


17.00      FINANCIAL COVENANTS


 


17.01      COVENANTS AS TO
BORROWER


 


Borrower, agrees to comply with the following financial ratios the
default of which shall constitute a default of this Agreement:


 


(a) Maximum loan-to-value ratio shall at all
times not be in excess of seventy percent (70%).


 


(b) Commencing at 2010 fiscal year end, the
Borrower will be tested for compliance with the Debt Service Coverage Ratio
which shall not be less than 1.15:1.00.


 


18.00      TENURE


 


Borrower’s liability under this Agreement shall commence
with the date hereof and continue in full force and effect and be binding upon
Borrower until all Obligations whether now in existence, or created
hereinafter, shall


 


53

















 


have been fully paid and satisfied, and until so paid
and satisfied, Lender shall be entitled to retain the security interest granted
hereby in all Collateral.  At any time,
either party may advise the other that no further loans or advances are to be
made, but such notice shall in no way cause any and all obligations of the
Borrower to Lender to be waived.


 


19.00      SETOFF


 


Regardless
of the adequacy of any Collateral, and at all times, any deposits (general or
specific, time or demand, provisional or final, regardless of currency,
maturity, or the branch of the Lender where such deposits are held) or other
sums credited by or due from the Lender to the Borrower and any securities or
other property of the Borrower in the possession of the Lender may be applied to
or set off against the payment of the Obligations and any and all other
liabilities, direct, or indirect, absolute or contingent, due or to become due,
now existing or hereafter arising, of the Borrower to the Lender.


 


20.00      EXPENSES


 


The
Borrower agrees to pay (a) the reasonable costs of producing and
reproducing this Agreement, the other Loan Documents and the other agreements
and instruments mentioned herein, (b) any taxes (including any interest
and penalties in respect thereto) payable by the Lender (other than taxes based
upon the Lender’s net income), including any recording, mortgage or intangibles
taxes in connection with the Mortgage, or other taxes payable on or with
respect to the transactions contemplated by this Agreement, including any taxes
payable by the Lender after the Closing Date (the Borrower hereby agreeing to
indemnify the Lender with respect thereto), (c) all title insurance
premiums, and the reasonable fees, expenses and disbursements of the Lender’s
counsel or any local counsel to the Lender incurred in connection with the
preparation, administration or interpretation of the Loan Documents and other
instruments mentioned herein, the making of each Advance hereunder, and
amendments, modifications, approvals, consents or waivers hereto or hereunder, (d) the
fees, expenses and disbursements of the Lender incurred in connection with the
preparation, administration or interpretation of the Loan Documents and other
instruments mentioned herein, and the making of each Advance hereunder (including
all fees paid to the Construction Inspector, Appraisal fees, and surveyor fees)
(e) all reasonable out-of-pocket expenses (including reasonable attorneys’
fees and costs, which attorneys may be employees of the Lender and the fees and
costs of consultants, accountants, auctioneers, receivers, brokers, property
managers, appraisers, investment bankers or other experts retained by the
Lender in connection with (i) the enforcement of or preservation of rights
under any of the Loan Documents against the Borrower or the Guarantor or the
administration thereof after the occurrence of a Default or Event of Default
and (ii) any litigation, proceeding or dispute whether arising hereunder
or otherwise, in any way related to the Lender’s relationship with the Borrower
or the Guarantor, and (f) all reasonable fees, expenses and disbursements
of the Lender incurred in connection with UCC searches, UCC filings, title
rundowns, title searches or mortgage recordings. The covenants of this Section 20.00
shall survive payment or satisfaction of payment of all amounts owing with
respect to the Construction Note. The Lender shall act reasonably in incurring
any costs and expenses described in this Section 20.00 which are to be
paid by the Borrower.


 


21.00      INDEMNIFICATION


 


Except for gross negligence committed by Lender, the
Borrower agrees to indemnify and hold harmless the Lender from and against any
and all claims, actions and suits, whether groundless or otherwise, and from
and against any and all liabilities, losses, damages and expenses of every
nature and character arising out of this Agreement or any of the other Loan
Documents or the transactions contemplated hereby and thereby including,
without limitations, (a) any brokerage, leasing, finders or similar fees, (b) any
disbursement of the proceeds of any of the Advances, (c) any condition of
the Project whether related to the quality of construction or otherwise, (d) any
actual or proposed use by the Borrower of the proceeds of any of the Advances, (e) any
actual or alleged violation of any Requirements or Project Approvals, (f) the
Borrower entering into or performing this Agreement or any of the other Loan
Documents or (g) with respect to the Borrower and Guarantor, their
respective properties and assets, the violation of any Environmental Law, the
Release or threatened Release of any Hazardous Materials or any action, suit,
proceeding or investigation brought or threatened with respect to any Hazardous
Materials (including, but not limited to claims with respect to wrongful death,
personal injury or damage to property), in each case including, without
limitation, the reasonable fees and disbursements of counsel and allocated
costs of internal counsel incurred in connection with any such investigation,
litigation or other proceeding. In litigation, or the preparation therefore, 


 


54

















 


the Lender shall be entitled to select its own counsel
and, in addition to the foregoing indemnity, the Borrower agrees to pay
promptly the reasonable fees and expenses of such counsel. The obligations of
the Borrower under this Section 21.00 shall survive the repayment of the
Construction Loan and shall continue in full force and effect so long as the
possibility of such claim, action or suit exists. If, and to the extent that
the obligations of the Borrower under this Section 21.00 are unenforceable
for any reason, the Borrower hereby agrees to make the maximum contribution to
the payment in satisfaction of such obligations which is permissible under
applicable law.


 


22.00      LIABILITY OF THE
LENDER


 


No
action shall be commenced by the Borrower or Guarantor for any claim against
the Lender under the terms of this Agreement unless written notice thereof,
specifically setting forth the claim of the Borrower, shall have been given to
the Lender at least fifteen (15) Business Days prior to the commencement of
such action.   The liability of the
Lender to the Borrower and Guarantor for any breach of the terms of this
Agreement by the Lender shall not exceed a sum equal to the amount which the
Lender shall be determined to have failed to Advance in consequence of a breach
by the Lender of its obligations under this Agreement, together with interest
thereon at the rate payable by the Borrower under the terms of the Note for
Advances which the Borrower is to receive hereunder, computed from the date
when the Advance should have been made by the Lender to the date when the
Advance is, in fact, made by the Lender and upon the making of any such payment
by the Lender to the Borrower, the same shall be treated as an Advance under
this Agreement, in the same fashion as any other Advance under the terms of
this Agreement.  In no event shall the
Lender be liable to the Borrower and/or Guarantor, or anyone claiming by, under
or through the Borrower and/or Guarantor, for any special, exemplary, punitive
or consequential damages, whatever the nature of the breach of the terms of
this Agreement by the Lender, such damages and claims therefore being expressly
waived by the Borrower and Guarantor.


 


23.00      RIGHTS OF THIRD
PARTIES


 


All
conditions to the performance of the obligations of the Lender under this
Agreement, including the obligation to make Advances, are imposed solely and
exclusively for the benefit of the Lender and no other Person shall have
standing to require satisfaction of such conditions in accordance with their
terms or be entitled to assume that the Lender will refuse to make Advances in
the absence of strict compliance with any or all thereof and no other Person
shall, under any circumstances, be deemed to be a beneficiary of such
conditions, any and all of which may be freely waived in whole or in part by
the Lender at any time if in its sole discretion it deems it desirable to do
so. In particular, the Lender makes no representations and assumes no
obligations as to third parties concerning the quality of the construction by
the Borrower of the Improvements or the absence therefrom of defects.


 


24.00      SURVIVAL OF
COVENANTS, ETC.


 


All
covenants, agreements, representations and warranties made herein,  in the Construction Note, in any of the other
Loan Documents or in any documents or other papers delivered by or on behalf of
the Borrower or the Guarantor pursuant hereto and thereto shall be deemed to
have been relied upon by the Lender, notwithstanding any investigation
heretofore or hereafter made by it, and shall survive the making by the Lender
of the Advances, as herein contemplated, and shall continue in full force and
effect so long as any amount due under this Agreement or the Note or any of the
other Loan Documents remains outstanding or the Lender has any obligation to
make any Advances. All statements contained in any certificate or other paper
delivered to the Lender at any time by or on behalf of the Borrower or the
Guarantor pursuant hereto or in connection with the transactions contemplated
hereby shall constitute representations and warranties by the Borrower or the
Guarantor hereunder.


 


25.00      PARTICIPATION; ETC.


 


25.01    PARTICIPATIONS


 


The
Lender may sell participations to one or more banks or other entities in all or
a portion of the Lender’s rights and obligations under this Agreement and the
other Loan Documents; Provided that (a) any such sale or participation
shall not affect the rights and duties of the Lender hereunder to the Borrower
and (b) the only rights granted to the participant pursuant to such
participation arrangements with respect to waivers, amendments or modifications
of the Loan Documents shall be the right to approve waivers, amendments or
modifications that 


 


55

















 


would
reduce the principal of or the interest rate on the Construction Loan, extend
the term or increase the amount of the Construction Loan or extend any
regularly scheduled payment date for principal or interest.


 


25.02 PLEDGE BY THE LENDER


 


The
Lender may at any time pledge all or any portion of its interest and rights
under this Agreement (including all or any portion of the Note) to any of the
twelve Federal Reserve Banks organized under Section 4 of the Federal
Reserve Act, 12 U.S.C., § 341. No such pledge or the enforcement thereof shall
release the Lender from its obligations hereunder or under any of the other
Loan Documents.


 


25.03 NO ASSIGNMENT BY THE BORROWER


 


The
Borrower shall not assign or transfer any of its rights or obligations under
any of the Loan Documents without the prior approval of the Lender.


 


26.00 RELATIONSHIP


 


The
relationship between the Lender and the Borrower is solely that of a lender and
borrower, and nothing contained herein or in any of the other Loan Documents
shall in any manner be construed as making the parties hereto partners, joint
venturers or any other relationship other than lender and borrower.


 


27.00 NOTICES


 


Each
notice, demand, election or request provided for or permitted to be given
pursuant to this Agreement (hereinafter in this Section 27.00 referred to
as “Notice”) must be in writing and shall be deemed to have been properly given
or served by personal delivery or by sending same by overnight courier or by
depositing same in the United States Mail, postpaid and registered or
certified, return receipt requested, and addressed as follows:


 


	
  If to the Lender:

  	
  Berkshire
  Bank

  
	
   

  	
  31
  Court Street

  
	
   

  	
  Westfield,
  MA 01085

  
	
   

  	
   

  
	
   

  	
  Attn:
  Shaun Dwyer, Vice President

  
	
   

  	
   

  
	
  with a copy to:

  	
  Peter
  W. Shrair, Esquire

  
	
   

  	
  Cooley,
  Shrair, P.C.

  
	
   

  	
  1380
  Main Street

  
	
   

  	
  Springfield,
  Massachusetts 01103

  
	
   

  	
   

  
	
  If to the Borrower:

  	
  Tradeport
  Development III, LLC

  
	
   

  	
  204
  West Newberry Road

  
	
   

  	
  Bloomfield,
  CT 06002

  
	
   

  	
   

  
	
  With a copy to:

  	
  Thomas
  M. Daniells, Esquire

  
	
   

  	
  Murtha
  Cullina LLP

  
	
   

  	
  CitiPlace
  1

  
	
   

  	
  185
  Asylum Street

  
	
   

  	
  Hartford,
  CT 06103

  
	
   

  	
   

  
	
  If to Guarantor:

  	
  Griffin
  Land & Nurseries, Inc.

  
	
   

  	
  204
  West Newberry Road

  
	
   

  	
  Bloomfield,
  CT 06002

  
	
   

  	
   

  
	
  With a copy to:

  	
  Thomas
  M. Daniells, Esquire

  
	
   

  	
  Murtha
  Cullina LLP

  
	
   

  	
  CitiPlace
  1

  



 


56

















 


	
   

  	
  185
  Asylum Street

  
	
   

  	
  Hartford, CT 06103

  



 


Each
Notice shall be effective upon being personally delivered or upon being sent by
overnight courier or upon being deposited in the United States Mail as
aforesaid. The time period in which a response to such Notice must be given or
any action taken with respect thereto (if any), however, shall commence to run
from the date of receipt if personally delivered or sent by overnight courier,
or if so deposited in the United States Mail, the earlier of three (3) Business
Days following such deposit or the date of receipt as disclosed on the return
receipt. Rejection or other refusal to accept or the inability to deliver because
of changed address for which no Notice was given shall be deemed to be receipt
of the Notice sent. By giving at least thirty (30) days prior Notice thereof,
the Borrower or the Lender shall have the right from time to time and at any
time during the term of this Agreement to change their respective addresses and
each shall have the right to specify as its address any other address within
the United States of America.


 


28.00 GOVERNING LAW


 


This
Agreement and each of the other Loan Documents, except as otherwise
specifically provided there in, are contracts under the laws of the
Commonwealth of Massachusetts and shall for all purposes be construed in
accordance with and governed by the laws of said Commonwealth (excluding the
laws applicable to conflicts or choice of law).


 


29.00 CONSENT TO JURISDICTION


 


THE
BORROWER AND GUARANTOR HEREBY IRREVOCABLY AND UNCONDITIONALLY (A) SUBMITS
TO PERSONAL JURISDICTION IN THE COMMONWEALTH OF MASSACHUSETTS OVER ANY SUIT,
ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OF THE
OTHER LOAN DOCUMENTS, AND (B) WAIVES ANY AND ALL PERSONAL RIGHTS UNDER THE
LAWS OF ANY STATE (I) TO THE RIGHT, IF ANY, TO TRIAL BY JURY, (II) TO
OBJECT TO JURISDICTION WITHIN THE COMMONWEALTH OF MASSACHUSETTS OR VENUE IN ANY
PARTICULAR FORUM WITHIN THE COMMONWEALTH OF MASSACHUSETTS, AND (III) TO
THE RIGHT, IF ANY, TO CLAIM OR RECOVER ANY SPECIAL, EXEMPLARY, PUNITIVE OR
CONSEQUENTIAL DAMAGES OR ANY DAMAGES OTHER THAN ACTUAL DAMAGES.  THE BORROWER AGREES THAT, IN ADDITION TO
ANY METHODS OF SERVICE OF PROCESS PROVIDED FOR UNDER APPLICABLE LAW, ALL
SERVICE OF PROCESS IN ANY SUCH SUIT, ACTION OR PROCEEDING MAY BE MADE BY
CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT REQUESTED DIRECTED TO THE BORROWER
AT THE ADDRESS SET FORTH IN SECTION 27.00 ABOVE, AND SERVICE SO MADE SHALL
BE COMPLETE FIVE (5) DAYS AFTER THE SAME SHALL BE SO MAILED. NOTHING
CONTAINED HEREIN, HOWEVER, SHALL PREVENT THE LENDER FROM BRINGING ANY SUIT,
ACTION OR PROCEEDING OR EXERCISING ANY RIGHTS AGAINST ANY COLLATERAL AND
AGAINST THE BORROWER, AND AGAINST ANY PROPERTY OF THE BORROWER, IN ANY
OTHER STATE. INITIATING SUCH SUIT, ACTION OR PROCEEDING OR TAKING SUCH ACTION
IN ANY STATE SHALL IN NO EVENT CONSTITUTE A WAIVER OF THE AGREEMENT CONTAINED
HEREIN THAT THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS SHALL GOVERN THE
RIGHTS AND OBLIGATIONS OF THE BORROWER AND THE LENDER HEREUNDER OR THE
SUBMISSION HEREIN BY THE BORROWER TO PERSONAL JURISDICTION WITHIN THE
COMMONWEALTH OF MASSACHUSETTS.


 


30.00 HEADINGS


 


The
captions in this Agreement are for convenience of reference only and shall not
define or limit the provisions hereof.


 


31.00 COUNTERPARTS


 


This
Agreement and any amendment hereof may be executed in several counterparts and
by each party on a separate counterpart, each of which when so executed and
delivered shall be an original, and all of which together 


 


57

















 


shall
constitute one instrument. In proving this Agreement it shall not be necessary
to produce or account for more than one such counterpart signed by the party
against whom enforcement is sought.


 


32.00 ENTIRE AGREEMENT, ETC.


 


The
Loan Documents and any other documents executed in connection herewith or
therewith express the entire understanding of the parties with respect to the
transactions contemplated hereby. Neither this Agreement nor any term hereof
may be changed, waived, discharged or terminated, except as provided in Section 33.00.


 


33.00 CONSENTS, AMENDMENTS, WAIVERS, ETC.


 


Except
as otherwise expressly set forth in any particular provision of this Agreement,
any consent or approval required or permitted by this Agreement to be given by
the Lender may be given, and any term of this Agreement or of any other
instrument related hereto or mentioned herein may be amended, and the
performance or observance by the Borrower of any terms of this Agreement or
such other instrument or the continuance of any Default or Event of Default may
be waived (either generally or in a particular instance and either retroactively
or prospectively) with, but only with, the written consent of the Lender. No
waiver shall extend to or affect any obligation not expressly waived or impair
any right consequent thereon. No course of dealing or delay or omission on the
part of the Lender in exercising any right shall operate as a waiver thereof or
otherwise be prejudicial thereto. No Advance made by the lender hereunder
during the continuance of any Default or Event of Default shall constitute a
waiver there of. No notice to or demand upon the Borrower shall entitle the
Borrower to other or further notice or demand in similar or other
circumstances.


 


34.00 TIME OF THE ESSENCE


 


Time
is of the essence with respect to each and every covenant, agreement and
obligation of the Borrower under this Agreement and the other Loan Documents
and the Guarantor.


 


35.00 SEVERABILITY


 


The
provisions of this Agreement are severable, and if any one clause or provision
hereof shall be held invalid or unenforceable in whole or in part in any
jurisdiction, then such invalidity or unenforceability shall affect only such
clause or provision, or part thereof, in such jurisdiction, and shall not in
any manner affect such clause or provision in any other jurisdiction, or any
other clause or provision of this Agreement in any jurisdiction.


 


IN
WITNESS WHEREOF, the undersigned have duly executed this Agreement as a sealed
instrument as of the date first set forth above.


 


[THE REMAINDER OF THIS PAGE INTENTIONALLY ENDS HERE;


SIGNATURE PAGE TO FOLLOW]


 


58

















 


	
  BORROWER:

  	
   

  	
  TRADEPORT
  DEVELOPMENT III, LLC BY

  
	
   

  	
   

  	
  GRIFFIN
  LAND & NURSERIES, INC.,

  
	
   

  	
   

  	
  ITS
  SOLE MEMBER

  
	
   

  	
   

  	
   

  
	
  /s/Thomas
  M. Daniels

  	
   

  	
  By:

  	
  /s/Frederick
  M. Danziger

  
	
  Witness

  	
   

  	
  Its
  duly authorized

  
	
   

  	
   

  	
   

  
	
  /s/Thomas
  M. Lescalleet

  	
   

  	
   

  
	
  Witness

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  GUARANTOR:

  	
   

  	
  GRIFFIN
  LAND & NURSERIES, INC.

  
	
   

  	
   

  	
   

  
	
  /s/Thomas
  M. Daniels

  	
   

  	
  By:

  	
  /s/Frederick
  M. Danziger

  
	
  Witness

  	
   

  	
  Its
  duly authorized

  
	
   

  	
   

  	
   

  
	
  /s/Thomas
  M. Lescalleet

  	
   

  	
   

  
	
  Witness

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  LENDER:

  	
   

  	
  BERKSHIRE
  BANK

  
	
   

  	
   

  	
   

  
	
  /s/Peter
  Shrair

  	
   

  	
  By:

  	
  /s/Joseph
  Marullo

  
	
  Witness

  	
   

  	
  Its
  duly authorized

  
	
   

  	
   

  	
   

  
	
  /s/Candace
  Goodreau

  	
   

  	
   

  
	
  Witness

  	
   

  	
   

  



 


59
















 


Exhibit A


Construction Schedule


 


Griffin Land


304,000 SF Warehouse


Preliminary Schedule


 


	
  ID

  	
   

  	
  Task Name

  	
   

  	
  Duration

  	
   

  	
  Completion Date

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1

  	
   

  	
  Selection
  of Construction Manager

  	
   

  	
  64 days

  	
   

  	
  01/08/09

  
	
  2

  	
   

  	
  Contract
  Construction Manager

  	
   

  	
  0 days

  	
   

  	
  01/08/09

  
	
  3

  	
   

  	
  Design

  	
   

  	
  86 days

  	
   

  	
  02/08/09

  
	
  4

  	
   

  	
  Civil Drawings

  	
   

  	
  80 days

  	
   

  	
  01/30/09

  
	
  5

  	
   

  	
  Structural Drawings

  	
   

  	
  20 days

  	
   

  	
  02/09/09

  
	
  6

  	
   

  	
  Architectural

  	
   

  	
  20 days

  	
   

  	
  02/05/09

  
	
  7

  	
   

  	
  MEP’s

  	
   

  	
  20 days

  	
   

  	
  02/09/09

  
	
  8

  	
   

  	
  Contract — Sitework

  	
   

  	
  1 day

  	
   

  	
  01/05/09

  
	
  9

  	
   

  	
  Permits

  	
   

  	
  20 days

  	
   

  	
  02/09/09

  
	
  10

  	
   

  	
  Order
  long lead items

  	
   

  	
  42 days

  	
   

  	
  04/08/09

  
	
  11

  	
   

  	
  Structural Steel

  	
   

  	
  8 weeks

  	
   

  	
  04/08/09

  
	
  12

  	
   

  	
  Reinforcing rods

  	
   

  	
  20 days

  	
   

  	
  03/09/09

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  14

  	
   

  	
  CONSTRUCTION

  	
   

  	
  147 days

  	
   

  	
  07/26/09

  
	
  15

  	
   

  	
  Site work

  	
   

  	
  104 days

  	
   

  	
  05/24/09

  
	
  16

  	
   

  	
  Erosion control

  	
   

  	
  3 days

  	
   

  	
  01/08/09

  
	
  17

  	
   

  	
  Cuts and fills

  	
   

  	
  31 days

  	
   

  	
  02/20/09

  
	
  18

  	
   

  	
  Prepare building sub-grade

  	
   

  	
  10 days

  	
   

  	
  03/06/09

  
	
  19

  	
   

  	
  Utilities

  	
   

  	
  60 days

  	
   

  	
  05/29/09

  
	
  20

  	
   

  	
  Site improvements

  	
   

  	
  100 days

  	
   

  	
  07/19/09

  
	
  21

  	
   

  	
  Retaining walls

  	
   

  	
  20 days

  	
   

  	
  04/03/09

  
	
  22

  	
   

  	
  Road gravel

  	
   

  	
  10 days

  	
   

  	
  06/01/09

  
	
  23

  	
   

  	
  Binder course of paving

  	
   

  	
  3 days

  	
   

  	
  06/03/09

  
	
  24

  	
   

  	
  Top course of paving

  	
   

  	
  2 days

  	
   

  	
  07/17/09

  
	
  25

  	
   

  	
  Loam and seed — Landscaping

  	
   

  	
  10 days

  	
   

  	
  07/15/09

  
	
  26

  	
   

  	
  Building Construction

  	
   

  	
  108 days

  	
   

  	
  07/26/09

  
	
  27

  	
   

  	
  Building Shell

  	
   

  	
  90 days

  	
   

  	
  07/05/09

  
	
  28

  	
   

  	
  Foundations — warehouse

  	
   

  	
  20 days

  	
   

  	
  03/27/09

  
	
  29

  	
   

  	
  Foundation insulation — warehouse

  	
   

  	
  5 days

  	
   

  	
  03/27/09

  
	
  30

  	
   

  	
  Underground plumbing & Electrical

  	
   

  	
  20 days

  	
   

  	
  04/10/09

  
	
  31

  	
   

  	
  Prep. Building slab

  	
   

  	
  15 days

  	
   

  	
  04/10/09

  
	
  32

  	
   

  	
  Building Slab on grade — warehouse

  	
   

  	
  20 days

  	
   

  	
  05/08/09

  
	
  33

  	
   

  	
  Form and cast Tilt panels

  	
   

  	
  20 days

  	
   

  	
  05/22/09

  
	
  34

  	
   

  	
  Erect tilt panels

  	
   

  	
  10 days

  	
   

  	
  06/05/09

  
	
  35

  	
   

  	
  Structural Steel, deck and joist

  	
   

  	
  55 days

  	
   

  	
  06/26/09

  
	
  36

  	
   

  	
  Masonry walls

  	
   

  	
  9 days

  	
   

  	
  04/23/09

  
	
  37

  	
   

  	
  Roofing

  	
   

  	
  30 days

  	
   

  	
  07/03/09

  
	
  38

  	
   

  	
  Rack Installation begins

  	
   

  	
  0 days

  	
   

  	
  07/01/09

  
	
  39

  	
   

  	
  O.H. doors

  	
   

  	
  9 days

  	
   

  	
  06/18/09

  
	
  40

  	
   

  	
  Windows

  	
   

  	
  10 days

  	
   

  	
  06/19/09

  
	
  41

  	
   

  	
  Painting

  	
   

  	
  20 days

  	
   

  	
  07/03/09

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  42

  	
   

  	
  Interior work

  	
   

  	
  51 days

  	
   

  	
  07/20/09

  
	
  43

  	
   

  	
  Rough Fire Protection

  	
   

  	
  40 days

  	
   

  	
  07/10/09

  
	
  44

  	
   

  	
  Rough Plumbing

  	
   

  	
  10 days

  	
   

  	
  06/11/09

  
	
  45

  	
   

  	
  Rough HVAC

  	
   

  	
  20 days

  	
   

  	
  06/11/09

  



 


60

















 


	
  46

  	
   

  	
  Rough Electrical

  	
   

  	
  30 days

  	
   

  	
  06/26/09

  
	
  47

  	
   

  	
  Loading dock equipment

  	
   

  	
  10 days

  	
   

  	
  07/10/09

  
	
  48

  	
   

  	
  Finish Fire Protection

  	
   

  	
  15 days

  	
   

  	
  07/24/09

  
	
  49

  	
   

  	
  Finish Plumbing

  	
   

  	
  20 days

  	
   

  	
  07/09/09

  
	
  50

  	
   

  	
  Finish HVAC

  	
   

  	
  20 days

  	
   

  	
  07/09/09

  
	
  51

  	
   

  	
  Finish Electrical

  	
   

  	
  20 days

  	
   

  	
  07/24/09

  
	
  52

  	
   

  	
  Inspections

  	
   

  	
  14 days

  	
   

  	
  07/26/09

  
	
  53

  	
   

  	
  Plumbing

  	
   

  	
  1 day

  	
   

  	
  07/10/09

  
	
  54

  	
   

  	
  Electrical

  	
   

  	
  1 day

  	
   

  	
  07/27/09

  
	
  55

  	
   

  	
  Fire Alarm

  	
   

  	
  1 day

  	
   

  	
  07/28/09

  
	
  56

  	
   

  	
  Building

  	
   

  	
  1 day

  	
   

  	
  07/29/09

  
	
  57

  	
   

  	
  Project Closeout

  	
   

  	
  10 days

  	
   

  	
  07/29/09

  
	
  58

  	
   

  	
  As-Built Plans and O & M’s

  	
   

  	
  10 days

  	
   

  	
  07/30/09

  
	
  59

  	
   

  	
  Punch List

  	
   

  	
  10 days

  	
   

  	
  07/30/09

  
	
  60

  	
   

  	
  Certificate of Occupancy

  	
   

  	
  1 day

  	
   

  	
  07/30/09

  
	
  61

  	
   

  	
  Certificate of Substantial Completion

  	
   

  	
  0 days

  	
   

  	
  07/30/09

  



 


61

















 


Exhibit B


 


Disbursement Schedule


 


Cost
Schedule


 


Tire
Rack


100
International Drive


Windsor,
CT


 


2/5/2009


 


	
  Year

  	
   

  	
  Month

  	
   

  	
  Estimated

  Costs

  	
   

  	
  %

  Complete

  	
   

  	
  Lease

  Commission

  	
   

  	
  Bank

  Legal

  	
   

  	
  Bank

  Points

  	
   

  	
  Other

  	
   

  	
  Total

  	
   

  	
  %

  Complete

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2008

  	
   

  	
  Sept.

  	
   

  	
  $

  	
  10,271

  	
   

  	
  —

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
  10,271

  	
   

  	
  —

  	
   

  
	
   

  	
   

  	
  Oct.

  	
   

  	
  $

  	
  258,747

  	
   

  	
  2

  	
  %

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
  258,747

  	
   

  	
  2

  	
  %

  
	
   

  	
   

  	
  Nov.

  	
   

  	
  $

  	
  148,996

  	
   

  	
  1

  	
  %

  	
   

  	
   

  	
  $

  	
  50,000

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
  198,996

  	
   

  	
  1

  	
  %

  
	
   

  	
   

  	
  Dec.

  	
   

  	
  $

  	
  12,629

  	
   

  	
  —

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
  12,629

  	
   

  	
  —

  	
   

  
	
  2009

  	
   

  	
  Jan.

  	
   

  	
  $

  	
  1,131,930

  	
   

  	
  8

  	
  %

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
  1,131,930

  	
   

  	
  7

  	
  %

  
	
   

  	
   

  	
  Feb.

  	
   

  	
  $

  	
  1,121,881

  	
   

  	
  15

  	
  %

  	
  $

  	
  270,550

  	
   

  	
  $

  	
  35,000

  	
   

  	
  $

  	
  180,000

  	
   

  	
  $

  	
  15,000

  	
   

  	
  $

  	
  1,622,431

  	
   

  	
  10

  	
  %

  
	
   

  	
   

  	
  Mar.

  	
   

  	
  $

  	
  1,271,113

  	
   

  	
  24

  	
  %

  	
   

  	
   

  	
  $

  	
  15,000

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
  1,286,113

  	
   

  	
  8

  	
  %

  
	
   

  	
   

  	
  April

  	
   

  	
  $

  	
  2,824,360

  	
   

  	
  43

  	
  %

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
  2,824,360

  	
   

  	
  18

  	
  %

  
	
   

  	
   

  	
  May

  	
   

  	
  $

  	
  4,049,162

  	
   

  	
  70

  	
  %

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
  4,049,162

  	
   

  	
  26

  	
  %

  
	
   

  	
   

  	
  June

  	
   

  	
  $

  	
  2,795,035

  	
   

  	
  89

  	
  %

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
  2,795,035

  	
   

  	
  18

  	
  %

  
	
   

  	
   

  	
  July

  	
   

  	
  $

  	
  950,091

  	
   

  	
  95

  	
  %

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
  950,091

  	
   

  	
  6

  	
  %

  
	
   

  	
   

  	
  Aug.

  	
   

  	
  $

  	
  294,685

  	
   

  	
  97

  	
  %

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
  294,685

  	
   

  	
  2

  	
  %

  
	
   

  	
   

  	
  Sept.

  	
   

  	
  —

  	
   

  	
  —

  	
   

  	
  $

  	
  270,550

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
  270,550

  	
   

  	
  2

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
  $

  	
  14,868,900

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
  15,705,000

  	
   

  	
   

  	
   

  
																										



 


Note:


 


1.              Total cost includes:
environmental remediation, offsite utilities, water tank.


2.              Costs are when work is
completed.


3.              In January the
environmental work will require the following cash flow:


 


	
  1/19/2009

  	
   

  	
  $

  	
  100,000

  	
   

  
	
  1/21/2009

  	
   

  	
  $

  	
  100,000

  	
   

  
	
  1/23/2009

  	
   

  	
  $

  	
  100,000

  	
   

  
	
  1/26/2009

  	
   

  	
  $

  	
  125,000

  	
   

  
	
  1/28/2009

  	
   

  	
  $

  	
  125,000

  	
   

  
	
  1/30/2009

  	
   

  	
  $

  	
  125,000

  	
   

  
	
  2/03/2009

  	
   

  	
  $

  	
  125,000

  	
   

  
	
  2/05/2009

  	
   

  	
  $

  	
  125,000

  	
   

  
	
  2/10/2009

  	
   

  	
  $

  	
  89,718

  	
   

  
	
   

  	
   

  	
  $

  	
  1,014,718

  	
   

  



 


Payment
will be required by the receiving facility on the dates above.


 


62

















 


Exhibit C


 


The Premises


 


That
certain piece or parcel of land, with the improvements thereon, if any,
situated in the Town of Windsor, County of Hartford and State of Connecticut,
having a lot area of 58.455 acres and being shown as “100 INTERNATIONAL DRIVE”,
ON A CERTAIN MAP ENTITLED: “REVISION TO RESUBDIVISION PLAN PREPARED FOR GRIFFIN
LAND STONE RD., INTERNATIONAL DR. & RAINBOW RD. WINDSOR,
CONNECTICUT SCALE: 1 IN = 200 FT DECEMBER 19, 2005 REVISION PER TOWN STAFF
1/10/06” prepared by Ed Lally and Associates, Inc., which map is on file
in the Windsor town Clerk’s Office as Map No. 5212 to which reference may
be had for a more particular description.


 


63

















 


Exhibit D


 


Permitted Liens


 


1.              Real estate taxes to the
Town of Windsor on the List of October 1, 2008, which taxes are not yet
due and payable.


 


2.              Water use charges as may be
due to the Metropolitan District.


 


3.              Terms and provisions of a
Right of Way Agreement by and between American Sumatra Company and Northeastern
Gas Transmission Company dated May 5, 1952 and recorded in Volume 139 at Page 386
of the Windsor Land Records.


 


4.              Caveat, Deferred Outlet
Charge, by The Metropolitan District dated August 19, 1992 and recorded in
Volume 902 at Page 265 of the Windsor Land Records.


 


5.              Terms and provisions of an
Easement and Right of Way Agreement by and between River Bend Associates, Inc.
and Tennessee Gas Pipeline Company dated September 18, 2000 and recorded
in Volume 1247 at Page 519 of the Windsor Land Records.


 


6.              State of Connecticut
Department of Transportation Traffic Investigation Report to the State Traffic
Commission issued to River Bend Assoc., Inc. and Griffin Land &
Nurseries, Inc. dated December 16, 2008 and recorded in Volume 1650
at Page 599 of the Windsor Land Records.


 


7.              Fifty (50) foot front yard
setback line, 35-foot rear year setback line and 25-foot side yard setback
lines, as shown on a certain survey entitled, “ALTA/ASCM LAND TITLE SURVEY
PREPARED FOR TRADEPORT DEVELOPMENT III, LLC 100 INTERNATIONAL DRIVE WINDSOR<
CONNECTICUT SCALE: 1IN = 100 FT FEBRUARY 3, 2009” prepared by ed lally and
associates, inc.


 


8.              Open-End Construction
Mortgage made by Tradeport Development III, LLC in favor of Berkshire Bank
dated as of February 6, 2009 and recorded in the Windsor Land Records of
near date therewith.


 


9.              Collateral Assignment of
Rents and Leases between Tradeport Development III, LLC and Berkshire Bank
dated as of February 6, 2009 and recorded in the Windsor Land Records of
near date therewith.


 


10.       Unrecorded written Indenture
of Lease between Tradeport Development III, LLC and The Tire Rack, Inc.
dated January 9, 2009, which lease has been subordinated to the lien of
the Mortgage by Subordination, Non-Disturbance and Attornment Agreement dated
as of February 6, 2009.


 


64

















 


Exhibit E


 


Plans and
Specifications


 


65


















	
  

  	
  GRIFFN LAND -
  TIRE RACK DISTRIBUTION CENTER

  






 


66



















	
  

  	
  GRIFFN LAND -
  TIRE RACK DISTRIBUTION CENTER

  






 


67



















	
  

  	
  GRIFFN LAND -
  TIRE RACK DISTRIBUTION CENTER

  






 


68



















	
  

  	
  GRIFFN LAND -
  TIRE RACK DISTRIBUTION CENTER

  






 


69



















	
  

  	
  GRIFFN LAND -
  TIRE RACK DISTRIBUTION CENTER

  






 


70



















	
  

  	
  GRIFFN LAND -
  TIRE RACK DISTRIBUTION CENTER

  






 


71
















 


Exhibit F


 


Project Budget


 


Development Budget


Tire
Rack


100
International Drive


Windsor,
CT


304,200
Square Feet


 


	
   

  	
   

  	
  Projected Costs

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (as of 2/5/09)

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Subtotal cost

  	
   

  	
  Cost/SF

  	
   

  	
  Notes

  
	
  BASE BUILDING COSTS

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  General Contract

  	
   

  	
  9,183,100

  	
   

  	
  30.19

  	
   

  	
  Guaranteed
  price bid.

  
	
  Site Construction

  	
   

  	
  3,596,400

  	
   

  	
  11.82

  	
   

  	
  Includes
  off site utilities and FP. Excludes remediation (see Land Allocation)

  
	
  Concrete

  	
   

  	
  0

  	
   

  	
  0.00

  	
   

  	
   

  
	
  Masonry

  	
   

  	
  0

  	
   

  	
  0.00

  	
   

  	
   

  
	
  Metals

  	
   

  	
  0

  	
   

  	
  0.00

  	
   

  	
   

  
	
  Wood and Plastics

  	
   

  	
  0

  	
   

  	
  0.00

  	
   

  	
   

  
	
  Thermal and Moisture
  Protection

  	
   

  	
  0

  	
   

  	
  0.00

  	
   

  	
   

  
	
  Doors and Windows

  	
   

  	
  0

  	
   

  	
  0.00

  	
   

  	
   

  
	
  Finishes

  	
   

  	
  0

  	
   

  	
  0.00

  	
   

  	
   

  
	
  Specialties

  	
   

  	
  0

  	
   

  	
  0.00

  	
   

  	
   

  
	
  Equipment

  	
   

  	
  0

  	
   

  	
  0.00

  	
   

  	
   

  
	
  Furnishings

  	
   

  	
  0

  	
   

  	
  0.00

  	
   

  	
   

  
	
  Special Construction

  	
   

  	
  0

  	
   

  	
  0.00

  	
   

  	
   

  
	
  Conveying Systems

  	
   

  	
  0

  	
   

  	
  0.00

  	
   

  	
   

  
	
  Mechanical

  	
   

  	
  0

  	
   

  	
  0.00

  	
   

  	
   

  
	
  Electrical

  	
   

  	
  0

  	
   

  	
  0.00

  	
   

  	
   

  
	
  Fees and Permits

  	
   

  	
  660,000

  	
   

  	
  2.17

  	
   

  	
   

  
	
  Sub-total Base Building
  Costs

  	
   

  	
  13,439,500

  	
   

  	
  44.18

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  General Conditions

  	
   

  	
  150,000

  	
   

  	
  0.49

  	
   

  	
  Cap
  @ 1.5% of Sub-total Base Building Costs less Fees & Permits.

  
	
  Contingency

  	
   

  	
  136,400

  	
   

  	
  0.45

  	
   

  	
  Cap
  @ 1% of Sub-total Base Building Costs.

  
	
  Total
  Base Building Costs

  	
   

  	
  13,725,900

  	
   

  	
  45.12

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  LAND COSTS

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Land Allocation

  	
   

  	
  5,000,000

  	
   

  	
  16.44

  	
   

  	
  58
  acre parcel. Includes land for Expansion Premises.

  
	
  Site Remediation

  	
   

  	
  1,143,000

  	
   

  	
  3.76

  	
   

  	
  Substantially
  incurred. Includes excavation & remediation monitoring.

  
	
  Total
  Land Costs

  	
   

  	
  6,143,000

  	
   

  	
  20.19

  	
   

  	
   

  



 


72

















 


	
  Tire
  Rack

  	
  Development Budget

  
	
  100
  International Drive

  	
   

  
	
  Windsor,
  CT

  	
   

  
	
   

  	
   

  
	
  304,200
  Square Feet

  	
   

  



 


	
   

  	
   

  	
  Projected Costs

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (as of 2/5/09)

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Subtotal cost

  	
   

  	
  Cost/SF

  	
   

  	
  Notes

  
	
  LEASING COSTS

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Lease Commission

  	
   

  	
  541,100

  	
   

  	
  1.78

  	
   

  	
  As
  per commission agreement. Initial rent of $4.70/SF + 3% Annually.

  
	
  Legal

  	
   

  	
  60,000

  	
   

  	
  0.20

  	
   

  	
   

  
	
  Total
  Leasing Costs

  	
   

  	
  601,100

  	
   

  	
  1.98

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  FINANCING COSTS

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Points

  	
   

  	
  180,000

  	
   

  	
  0.59

  	
   

  	
  1.5
  pts on $12,000,000.

  
	
  Construction Interest
  Carry

  	
   

  	
  200,000

  	
   

  	
  0.66

  	
   

  	
  As
  per CBRE draw Schedule.

  
	
  Legal

  	
   

  	
  50,000

  	
   

  	
  0.16

  	
   

  	
   

  
	
  Environmental

  	
   

  	
  2,000

  	
   

  	
  0.01

  	
   

  	
  Phase
  1 only. All other is provided for under Site Remediation

  
	
  Bank Appraisal

  	
   

  	
  6,000

  	
   

  	
  0.02

  	
   

  	
  As
  per Berkshire Bank.

  
	
  Other Fees

  	
   

  	
  7,000

  	
   

  	
  0.02

  	
   

  	
  As
  per Berkshire. Presumes 7 Inspections.

  
	
  Total
  Financing Costs

  	
   

  	
  445,000

  	
   

  	
  1.46

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL PROJECT COSTS

  	
   

  	
  20,915,000

  	
   

  	
  68.75

  	
   

  	
   

  



 


73

















 


EXHIBIT G


 


	
  BORROWER’S
  REQUISITION

  	
   

  
	
   

  	
   

  
	
  BORROWER:

  	
   

  
	
   

  	
   

  
	
  LENDER:

  	
   

  
	
   

  	
   

  
	
  PROJECT:

  	
   

  
	
   

  	
   

  
	
  LOAN
  AMOUNT:

  	
  $

  
	
   

  	
   

  
	
  REQUISITION
  NO.:

  	
   

  
	
   

  	
   

  
	
  PERIOD
  COVERED:

  	
   

  



 


Pursuant
to the Construction Loan Agreement for the subject Construction Loan, the
Borrower hereby authorizes and requests an Advance against the proceeds of the
Construction Loan for the following purposes and the following amounts:


 


	
  1.

  	
  Direct
  Costs incurred to the end of period covered (from Schedule I):

  	
   

  
	
   

  	
   

  	
   

  
	
  2.

  	
  Total
  Direct Costs incurred:

  	
   

  
	
   

  	
   

  	
   

  
	
  3.

  	
  Less
  amount previously advanced:

  	
   

  
	
   

  	
   

  	
   

  
	
  4.

  	
  Account
  requisitioned for period covered:

  	
   

  
	
   

  	
   

  	
   

  
	
  5.

  	
  Balance
  to complete:

  	
   

  
	
   

  	
   

  	
   

  
	
  6.

  	
  Total
  of lines 2 & 5:

  	
   

  
	
   

  	
   

  	
   

  
	
  7.

  	
  Indirect
  Costs incurred to end of period covered (from Schedule II):

  	
   

  



 


Details
of Direct Costs requisitioned are listed on Schedule I attached and, with
respect to Direct Costs incurred under the Construction Contract, on the
standard AIA form attached.


 


Details
of Indirect Costs are listed on Schedule II attached.


 


In
connection with and in order to induce the Lender to advance the amount
requested above, and knowing that the Lender will rely thereon in doing so, the
Borrower hereby represents, warrants and stipulates as follows:


 


1.
There is existing no Event of Default and no condition or event which with the
lapse of time or the giving of notice, or both, would constitute an Event of
Default under, or a violation of, the Construction Loan and Security Agreement,
Note, Mortgage, or any of the other Loan Documents. The Borrower has duly
complied with and observed all of the terms, covenants, and conditions of each
of the Loan Documents required to be performed by the Borrower to the date of
this requisition, and unless the Lender is notified to the contrary prior to
the disbursement of the advance requested above, will be so on the date
thereof.


 


2.
The representations and warranties of the Borrower and the Guarantor contained
in the Loan Documents are true and correct on the date of this requisition, and
unless the Lender is notified to the contrary prior to the disbursement of the
amount requested above, will also be true and correct on the date thereof.


 


74

















 


3.
The amounts and percentages set forth on Schedules I and II attached hereto are
true and correct to the best of the Borrower’s knowledge and


 


A.
The total amount advanced under the Construction Loan after the honoring of
this requisition, plus retainage held, plus the Borrower’s Required Equity
Funds provided for in the Loan and Security Agreement, shall not exceed the
Direct Costs incurred, plus Indirect Costs incurred; and


 


B.
After the honoring of this requisition, the Construction Loan amount not yet
advanced, less the retainage held, shall be sufficient to pay for all Direct
Costs and Indirect Costs not yet paid and which will be required to complete
construction of the Project and to carry the Project through the maturity date
of the Construction  Loan as required or
contemplated by the Loan and Security Agreement.


 


4.
All sums previously requisitioned have been applied to the payment of the
Direct and Indirect Costs heretofore incurred and the proceeds of any advance
made in accordance with this request will be applied to, and solely to, payment
of the Direct Costs and Indirect Costs itemized in this requisition.


 


5.
Construction of the Project to date has in every respect been performed fully
in accordance with the Plans and Specifications and the Loan and Security
Agreement.


 


 


	
  BORROWER:

  	
   

  	
  TRADEPORT
  DEVELOPMENT III, LLC BY

  
	
   

  	
   

  	
  GRIFFIN
  LAND & NURSERIES, INC.,

  
	
   

  	
   

  	
  ITS
  SOLE MEMBER

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
  Witness

  	
   

  	
  Its
  duly authorized

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Witness

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  GUARANTOR:

  	
   

  	
  GRIFFIN
  LAND & NURSERIES, INC.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
  Witness

  	
   

  	
  Its
  duly authorized

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Witness

  	
   

  	
   

  



 


75

















 


EXHIBIT G


 


SCHEDULE I


 


Direct Costs


 


76

















 


EXHIBIT G


 


SCHEDULE I I


 


Indirect Costs


 


77
















 


EXHIBIT H


 


CONTRACTOR’S REQUISITION
CERTIFICATE


 


Application for Payment No.


 


	
  TO:

  	
  ____________________________________
  (“Lender”)

  
	
   

  	
   

  
	
  FROM:

  	
  _______________________________

  
	
   

  	
  _______________________________
  (“Contractor”)

  
	
   

  	
   

  
	
  RE:

  	
  (Construction
  of _______________________________________(the “Owner”)

  



 


We
are the general contractor for the Project, and to induce Lender to advance
loan proceeds to assist in funding construction of the Project and knowing that
Lender will rely on this certificate in doing so, we hereby certify as follows:


 


1.
In reference to our contract dated __________________ with Owner for
construction of the Project, and the Plans and Specifications therefore, no
amendments, modifications or changes have been made with respect to our contract
or the Plans and Specifications except such as have had your prior written
approval. There are no pending change orders except as follows:


 


2.
Our Application for Payment No. , dated ______________,  20____ which we understand is to be included
as an item in the Owner’s requisition to you, is in full compliance with the
terms of our contract with Owner, and, upon the payment of same, we will have
no other or additional claim (including claims for so-called “extras”) against
Owner on account of our contract or otherwise for and through the period of
time ending upon the date of our Application for Payment, for all labor and
materials furnished by us through and including the date of our Application for
Payment except as follows:


 


(a) retainage
not exceeding five percent (5%) of the value of labor and materials
incorporated into the Project and covered by applications submitted by us on
account of the Project for which payment is to be made to us after substantial
completion of our contract, as provided therein (the amount of said retainage,
as of the end of the period covered by our Application for Payment dated ______________,
20____ is $_________ ); and


 


(b) [specify
other claims, if any].


 


The
Contractor’s right to the payment of any retainage is subordinate to the Lender’s
right to repayment of its Loan, together with interest, by the Owner.


 


3.
The Owner is not in default of any of the Owner’s obligations to us as of the
date hereof except as follows:


 


4.
We have paid in full all our obligations to subcontractors, workmen, suppliers
and materialmen for and with respect to all labor and materials supplied
through and including the date of our last Application for Payment, except for
an amount equal to five  percent (5%)
thereof, which we are holding in accordance with the terms of such obligations
and our contract, and our subcontractors have paid their subcontractors,
workmen and materialmen in full for and with respect to all labor and materials
supplied through and including the date of our last Application for Payment.


 


5.
We waive and release any and all rights to claim any lien for labor done or
materials furnished up to an amount equal to the amount of our Application for
Payment dated ______________, 20___, 
plus the amount of all our previously funded applications.


 


78

















 


Executed
as an instrument under seal this ___ day of_________________.


 


	
  CONTRACTOR:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Its
  duly authorized

  



 


79

















 


EXHIBIT  I


 


ARCHITECT’S REQUISITION
CERTIFICATE


 


Application for Payment No.


 


	
  TO:

  	
  ______________________________________ (“Lender”)

  
	
   

  	
   

  
	
  FROM:

  	
  ________________________________ (“Architect”)

  
	
   

  	
  ________________________________

  
	
  RE:

  	
  (Construction
  of _____________________________________ (“Owner”)

  



 


We
are the Architect for the Project, and to induce Lender to advance loan
proceeds to assist in funding construction of the Project and knowing that
Lender will rely on this certificate in doing so, we hereby certify as follows:


 


1.
We inspected the Project on ___________, 20____ and found the status of the
Project on that date and the progress made on the Project since our last
certificate to you dated _________, 20___ to be as follows:


 


2.  All work to date has been done in accordance
with the Plans and Specifications and in a good and workmanlike manner. All
materials and fixtures usually furnished and installed or stored on site at the
current stage of construction have been furnished, installed or stored on site.
All of the work to date is hereby approved except as follows:


 


3.
We have examined the requisition being submitted herewith to you by Owner,
which requisition includes an Application for Payment from __________________________(“Contractor”)
respecting construction of the Project. The payment so applied for by
Contractor does not exceed (when added to the payments heretofore applied for
by and paid to Contractor) ___________percent (___%)  of the value of  materials on site, labor and materials
incorporated into the Project.


 


4.
We have been advised that as of this date there remains unexpended from the
proceeds of your Construction Loan $_________ which are available to fund
construction costs, from which funds to pay the aforementioned Application for
Payment will be deducted. In our opinion, such unexpended portion of your loan
proceeds, after deduction of funds sufficient to cover both the current
Application for Payment and the standard 10 percent retainage heretofore
withheld and to become due on account of previous applications, will be
sufficient to pay for all construction costs reasonably required to complete
the Project, provided that the amount advanced under the current application
is, in fact, applied against obligations incurred for labor and materials heretofore
furnished on account of construction of the Project.


 


5.
All permits, licenses, approvals and the like required to complete construction
of the Project have been validly issued by the appropriate authorities and are
in full force and effect, and there is no violation of any of the provisions
thereof or of any legal requirements applicable to the Project of which we have
notice or knowledge as of the date hereof except as follows:


 


Access
to and egress from the Project and all improvements to be constructed thereon
are in accordance with all applicable legal requirements. Water, drainage and
sanitary sewerage facilities and telephone, gas and electric services of public
utilities are or are due to be installed in the locations indicated on the Plans
and Specifications and are adequate to serve the Project. All necessary
approvals for installation of or connection to said facilities or services have
been obtained.


 


6.
To the best of our knowledge, there are no petitions, actions or proceedings
pending or threatened to revoke, rescind, alter or declare invalid any laws,
ordinances, regulations, permits, licenses or approvals for or relating to the
Project.


 


80

















 


7.
No amendments, modifications or changes have been made to our contract dated _____________,
with Owner except such as have had your prior written approval.


 


8.
Owner is not in default of any of Owner’s obligations to us as of the date
hereof except as follows:


 


This
certificate is rendered based on our examination of this Project, the Plans and
Specifications, the data comprising the Application for Payment and all other
matters which we deem relevant. We are to incur no liability under this
certificate except for failure to exercise due professional skill and
diligence.


 


Executed
as a sealed instrument this ______ day of______________.


 


	
  ARCHITECT:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Its
  duly authorized

  



 


81






 












 


Exhibit J


 


Photocopy
of Construction Note


 


82

















 


CONSTRUCTION


LINE-OF-CREDIT


MAXIMUM $12,000,000.00


 


CONSTRUCTION NOTE


 


AFTER DATE, FOR VALUE RECEIVED, the Undersigned,
Tradeport Development III, LLC, a Connecticut limited liability company, having
a usual place of business at 204 West Newberry Road, Bloomfield,
Connecticut  (the “Borrower”), promises
to pay to Berkshire Bank, a Massachusetts banking corporation, (“Lender”), or
order, at the Lender’s main office presently located at 31 Court Street,
Westfield, Massachusetts, or at such other place as Lender may designate in
writing, the maximum principal sum of Twelve Million and 00/100 Dollars
($12,000,000) or so much thereof as may be Advanced (each Advance shall be
referred to as an “Advance” and all such Advances shall collectively be
referred to as the “Advances”) pursuant to a Construction Loan and Security
Agreement of even date herewith (“Loan Agreement”)  and incorporated by reference herein made between
Borrower and Lender.  Capitalized terms
not defined herein shall have the meaning given in the Loan Agreement.  The principal outstanding shall be repaid,
together with interest thereon as provided in this Note as follows:


 


INTEREST


 


For the entire term of the Loan, the Loan shall bear
interest at an adjustable annual rate equal to thirty (30) day LIBOR, plus Two
Hundred Seventy Five (275) basis points (collectively the “Applicable Rate”).  Such adjustments shall become effective on
the  1st day of each month (the “Reset
Date”).  Lender shall not be required to
notify Borrower of adjustments in said interest rate.   Notwithstanding the foregoing, at no time
shall the Applicable Rate be less than four percent (4.00%) during the “Interest
Only Period” (defined hereinafter).


 


Subject to, and in accordance with the provisions of
this Note and the Loan Agreement, accrued and unpaid interest shall be due and
payable monthly, in arrears on the first day of each month.


 


REPAYMENT


 


Principal and interest due Lender hereunder shall be
payable as follows:


 


A.  Commencing on March 1,
2009  and thereafter on the same day of 


 


83

















 


each succeeding month for a period of twelve (12) months
(the “Interest Only Period”), monthly payments of interest only in arrears,
calculated at the above rate of interest upon the unpaid principal hereunder.


 


B.  Commencing
on  March 1, 2010 and thereafter on
the same day of each succeeding month for a period of one hundred eight (108)
months (and based upon an amortization period of twenty-five (25) years, equal
monthly payments of principal in accordance with the attached amortization
schedule, plus accrued interest at the above Applicable Rate.


 


C.  All remaining
unpaid principal and all accrued interest thereon shall be due and payable in
full ten (10) years from the date hereof.


 


Subject to the terms and conditions contained in the
Loan Agreement, the amount of the Borrower’s available construction line of
credit hereunder shall be subject to the terms set forth in the Loan
Agreement.  This Note is the Note
referred to in, and is subject to, and entitled to, the benefits of the Loan
Agreement between the Borrower and the Lender. 
The terms used herein which are defined in the Loan Agreement shall have
their defined meanings when used herein. 
The Loan Agreement, among other things, contains provisions for
acceleration of the maturity of this Note upon the happening of certain stated
events.


 


Principal sums advanced under this Note shall reduce the
amount of principal available under this Note and may not be re-borrowed
or re-advanced.  This Note may be prepaid
only in accordance with the provisions set forth in the Loan Agreement which
does contain a provision for a Prepayment Premium in accordance with Section 4.10 of the Loan
Agreement.  All prepayments (with
prepayment defined herein as any payment of principal in advance of its due
date) shall be applied against the principal payments due hereunder in the
inverse order of their maturity.


 


The Lender may, in its sole discretion, and
notwithstanding execution of this Note by the Borrower in its stated maximum
Principal Sum, act to advance lesser sums thereon to the Borrower in amounts,
and at times in accordance with the Loan Agreement.


 


However, nothing herein shall be construed to restrict
the Lender, in its sole and exclusive discretion, from making Advances in
excess of the stated maximum dollar amount, without requirement of execution of
additional promissory note(s), or otherwise modifying this Note, and its so
doing at any time, or times, shall not waive its rights to insist upon strict
compliance with the terms of this Note, the Loan Agreement, or any other
instruments executed in connection with this financial transaction, at any other
time, and to further rely upon all collateral secured to it for satisfaction of
all obligations of the Borrower to the Lender, without exception.


 


Borrower agrees that the Lender may, at its sole and
exclusive discretion, make loan advances to the Borrower upon verbal, or
written, authority of any two of the following four individuals:  


 


84

















 


Anthony J. Galici, Thomas M. Lescalleet, Frederick M.
Danziger and Kelly Poudrette ; may deliver loan proceeds by direct deposit to
any demand deposit account of the Borrower with the Lender, or otherwise, as so
directed; and that all such loans and advances as evidenced solely by the
Lender’s books, ledgers and records shall conclusively represent binding
obligations of the Borrower hereunder.


 


The Lender shall also record as a debit to the Borrower’s
Loan Account, in accordance with its customary accounting practice, all other
obligations, debts, charges, expenses, and other items properly chargeable to
the Borrower; and shall credit all payments made by the Borrower on account of
indebtedness evidenced by the Borrower’s Loan Account; as well as all proceeds
of collateral which are finally paid to the Lender at its own office in cash or
solvent credits; and other appropriate debits and credits.  The principal balance of the Borrower’s Loan
Account shall reflect the amount of the Borrower’s indebtedness to the Lender
from time-to-time by reason of loans and other appropriate charges
hereunder.  At least once each month the
Lender shall render a statement of account for the Borrower’s Loan Account
which statement shall be considered correct and accepted by the Borrower and
conclusively binding upon the Borrower, unless the subject of written objection
received by Lender, certified mail, return receipt requested, within ten  (10) days after mailing of its statement
to Borrower.


 


Borrower does hereby irrevocably grant to the Lender,
full power and authority, at its discretion, to debit any deposit account of
the Borrower with the Lender for the amount of any monthly interest owing on
Borrower’s Loan Account referred to herein; for the amount of any principal
reduction, or for any repayment of obligations due upon Borrower’s Loan Account
which the Lender may require, all without prior notice, or demand upon the
Borrower.


 


Any payments received by Lender with respect to this
Note shall be applied first to any costs, charges, or expenses (including
attorney’s fees) due Lender from the Borrower, second to any unpaid interest
hereunder, and third to the unpaid Principal Sum.


 


If any payment required hereunder is more than ten  (10) days overdue, (in addition to the
interest accruing hereunder) a late charge of five percent (5%) of the overdue
payment shall be charged to the Borrower and be immediately due and payable to
Lender.  Any payment having a due date
falling upon a Saturday, Sunday, or legal holiday shall be due and payable on
the next business day for which Lender is open for business, and interest shall
continue to accrue during any such period.


 


If any payment received by Lender with respect to this
Note shall be deemed by a court of competent jurisdiction to have been a
voidable preference or fraudulent conveyance under federal or state law, or
otherwise due any party other than Lender, then the obligation for which the
payment was made shall not be discharged by the payment and shall survive as an
obligation due hereunder, notwithstanding the Lender’s return to the Borrower
or any other party of the original of this Note or other instrument evidencing
the obligation for which payment was made.


 


Interest hereunder shall be computed in accordance with
the Loan Agreement.  Upon the occurrence
of an Event of Default hereunder, interest upon the total unpaid principal
hereunder shall 


 


85

















 


thereafter, at Lender’s option, without notice to
Borrower and until payment in full of all obligations hereunder, accrue at a
rate (“Default Rate”) equal to five percent (5%) above the interest rate then
in effect hereunder at the time of default.


 


It is not intended under this Note to charge interest at
a rate exceeding the maximum rate of interest permitted to be charged under
applicable law, but if interest exceeding said maximum rate should be paid
hereunder, the excess shall, at Lender’s option, be (a) deemed a voluntary
prepayment of principal not subject to the prepayment premium (if any) set
forth herein or (b) refunded to the Borrower.


 


The following described property, in addition to
all other collateral now or hereafter provided by the Borrower to Lender, shall
secure this Note and all other present or future obligations of the Borrower to
Lender: The Loan shall be secured by First Mortgage and Security Interest on
the Premises known as 100 International Drive, Windsor, Connecticut (“Mortgaged
Premises”), together with a collateral assignment of rents and leases.   The Lender shall also be granted a
collateral assignment of all deposits, rights, licenses, permits, construction
contracts, architect contracts and other governmental approvals necessary for
the construction, development, use and occupancy of the Mortgaged Premises for
its intended purpose.


 


As additional collateral for the payment and performance
of this Note and all other obligations, whether now existing or hereafter
arising, of the Borrower to Lender, Lender shall at all times have and is
hereby granted a security interest in and right of offset against all cash,
deposit balances and/or accounts, instruments, securities, or other property of
the Borrower, now or hereafter in the possession of Lender, whether for
safekeeping or otherwise.  This right of
offset shall permit Lender at any time, after default, and without notice to
the Borrower to transfer such funds or property as may be deemed by Lender to
be appropriate so as to reduce or satisfy any obligation of the Borrower to the
Lender.


 


This Note shall be in default, and all unpaid principal,
interest, and other amounts due hereunder, shall, at Lender’s option, be
immediately due and payable, without prior notice, protest, or demand, upon the
occurrence of any one or more of the events of default (the “Events of Default”),
in accordance with the terms and conditions of the Loan Agreement.  Default upon this Note shall also operate as
a default upon all other Obligations of Borrower to Lender.


 


The Borrower (a) waives presentment, demand,
notice, protest, and delay in connection with the delivery, acceptance,
performance, collection, and enforcement of this Note, and (b) assents to
any extension, renewal, modification, or other indulgence permitted by Lender
with respect to this Note, including, without limitation, any release,
substitution, or addition of co-makers, of this Note and any release,
substitution, or addition of collateral securing this Note or any other
obligations of the Borrower to Lender, and (c) authorizes Lender, in its
sole and exclusive discretion and without notice to the Borrower, to complete
this Note if delivered incomplete in any respect.


 


No indulgence, delay, or omission by Lender in
exercising or enforcing any of its rights or remedies hereunder shall operate
as a waiver of any such rights or remedies or of the right to exercise them at
any later time.  No waiver of any default
hereunder shall operate as a waiver of any other 


 


86

















 


default hereunder or as a continuing waiver.  The Lender’s acceptance of any payment
hereunder, following any default, shall not constitute a waiver of such default
or of any of the Lender’s rights or remedies hereunder (including charging
interest at the Default Rate), unless waived in writing by Lender.


 


All of the Lender’s rights and remedies hereunder and
under any other loan documents, or instruments, shall be cumulative and may be
exercised singularly or concurrently, at the Lender’s sole and exclusive
discretion.


 


The Borrower agrees to pay on demand all costs and
expenses, including, but not limited to, reasonable attorney’s fees, incurred
by Lender in connection with the protection and/or enforcement of any of Lender’s
rights or remedies hereunder, whether or not any suit has been instituted by
Lender.


 


The word “Lender” where used herein shall mean the named
payee, its successors, assigns, affiliates, and endorsees (and/or the holder of
this Note if, at any time, it is made payable to bearer), all of whom this Note
shall inure to their benefit as holders in due course.


 


The word “Borrower” where used herein includes its
successors and assigns of this Note, and their respective heirs, successors,
assigns, and representatives, shall be jointly and severally liable
hereunder.  Any reference herein to the
Borrower, is a reference to such party or parties individually as well as
collectively.


 


The use of masculine or neuter genders hereunder shall
be deemed to include the feminine, and the use of the singular or the plural
herein shall be deemed to include the other, as the context may require.


 


The Borrower represents that the proceeds of this Note
will not be used for personal, family, or household purposes and that this loan
is strictly a commercial transaction.


 


Except as provided in clauses A, B, C, D and E, below,
notwithstanding anything else to the contrary contained in this Construction
Note or in any other document or instrument, the indebtedness evidenced by this
Construction Note or evidenced or secured thereunder shall be non-recourse to
the Borrower following the receipt of a final certificate of occupancy for the
Mortgaged Premises after which  Borrower
shall be liable upon the indebtedness evidence hereby or evidenced or secured
thereby to the full extent (but only to the extent) of the security therefore,
the same being the Mortgaged Premises and all rights, estates and interests
therein or related thereto securing the payment of this Construction Note.  If an Event of Default occurs hereunder or
under any of the Obligations, or in the timely and proper performance of any
Obligations of Borrower thereunder, any judicial proceedings brought by Lender,
or the holder hereof, against Borrower shall be limited to the preservation,
enforcement and foreclosure, or any thereof, of the liens, security, title,
estates, rights and security interests now or at anytime hereafter securing the
payment of this  Construction Note or the
other Obligations of Borrower to Lender, and no attachment, execution or other
writ of process shall be sought, issued, or levied upon any assets, properties
or funds of Borrower other than the Mortgaged Premises (except as provided
hereafter) and in the event of foreclosure of such liens, 


 


87

















 


security, title, estates, rights or security interests,
securing the payment of the Construction Note, and/or other Obligations of
Borrower, no judgment for any deficiency upon the indebtedness evidenced hereby
or evidenced or secured thereby shall be sought or obtained by Lender, or the
holder hereof, against Borrower, unless there has occurred an Event of
Default.  Borrower shall be  unconditionally liable to Lender for all of
its Obligations due to Lender by reason of, or in connection with the
occurrence of any of the following events:


 


A.  The
misapplication of any insurance proceeds or condemnation awards, including, but
not limited to, the failure to deliver same to Lender, any receiver or any
purchaser at foreclosure, if appropriate;


 


B.  Following an
Event of Default, the misapplication of any tenant rents or security deposits
or any other refundable deposits, including, but not limited to, the failure to
deliver same to Lender, any receiver or any purchaser at foreclosure, if
appropriate;


 


C.  The
misapplication of any Gross Revenues generated at or by the Mortgaged Premises
after the occurrence of an Event of Default under the Loan Documents;


 


D.  Waste committed
on the Mortgaged Premises or damage to the Mortgaged Premises as a result of
the intentional misconduct or gross negligence of Borrower or the wrongful
removal or destruction of any portion of the Mortgaged Premises; or


 


E.  Loss incurred
by lender and caused by the material breach of any material representation or
warranty made in connection with the Loan known by Borrower or  its Member to have been false when made or
deemed made, including any material misrepresentation or inaccuracy contained
in any financial statement or other document provided to the Lender pursuant to
this Agreement known by Borrower or  its
Member to have been false or inaccurate when provided.


 


THIS NOTE SHALL BE GOVERNED BY THE LAWS OF THE
COMMONWEALTH OF MASSACHUSETTS, AND THE BORROWER SUBMITS TO THE JURISDICTION OF
ITS COURTS WITH RESPECT TO ALL CLAIMS CONCERNING THIS NOTE OR ANY COLLATERAL
SECURING IT.


 


ALL PARTIES TO THIS NOTE, INCLUDING LENDER, AND AS
A NEGOTIATED PART OF THIS TRANSACTION, HEREBY EXPRESSLY WAIVE ALL RIGHTS
TO TRIAL BY JURY, AS TO ALL ISSUES, INCLUDING ANY COUNTERCLAIMS, WITHOUT
EXCEPTION, IN ANY ACTION OR PROCEEDING RELATING, DIRECTLY OR INDIRECTLY,
TO THIS NOTE AND/OR OTHER INSTRUMENTS OR LOAN DOCUMENTS (IF ANY) EXECUTED IN
CONNECTION HEREWITH.


 


88

















 


This Note constitutes a final written expression of all
of its terms and is a complete and exclusive statement of those terms.  Any modification or waiver of any of these
terms must be in writing signed by the party against whom the modification or
waiver is to be enforced.


 


The Borrower agrees to be bound by the terms of this
Note and acknowledge receipt of a signed copy hereof.


 


[THE REMAINDER OF THIS PAGE INTENTIONALLY ENDS
HERE]


 


89

















 


Signed as a sealed instrument this 6th day of February, 2009.


 


 


	
   

  	
   

  	
   

  	
  TRADEPORT DEVELOPMENT III, LLC

  
	
   

  	
   

  	
   

  	
  Griffin Land & Nurseries, Inc.

  
	
   

  	
   

  	
   

  	
   

  
	
  /s/Thomas M. Daniels

  	
   

  	
  By:

  	
  /s/Frederick M. Danziger

  
	
  Witness

  	
   

  	
   

  	
  Its duly authorized

  
	
   

  	
   

  	
   

  	
   

  
	
  /s/Thomas M. Lescalleet

  	
   

  	
   

  	
  Frederick M. Danziger

  
	
  Witness

  	
   

  	
   

  	
  Its President

  



 


90

















 


Exhibit K


 


Intellectual Property


 


None


 


91

















 


Exhibit L


 


Affiliate Transactions


 


None


 


92

















 


Exhibit M


 


Environmental Disclosure


 


	
  GEOQUEST, Inc.

  	
   

  	
   

  
	
   

  	
   

  	
  February 5,
  2009

  



 


Berkshire
Bank


31
Court Street


Westfield,
Massachusetts 01085


 


	
  Re:

  	
  Soil
  Remediation Project

  
	
   

  	
  100
  International Drive, Windsor, Connecticut

  
	
   

  	
  GeoQuest
  Project No. 1508

  



 


Ladies/Gentlemen:


 


As
you are aware, GeoQuest, Inc. is currently conducting a soil remediation
project on the above referenced property. 
The excavation and off-site disposal of the contaminated soil is
currently ongoing.  Upon the completion
of the fieldwork and receipt of the laboratory analyses for the confirmation
soil samples, GeoQuest will complete a final report for the project.  A copy of this report will be forwarded to
Berkshire Bank for its records.


 


In
order to comply with wetlands regulations, soil contamination on one portion of
the site (a 12,000 square foot designated wetland located along the western
exterior wall of the proposed site building) will remain after the current
remediation project is completed.  Based
on field observations, this area contains approximately 1,000 yards of
contaminated soil.  The final report will
include site plans depicting the location of the wetland area.  A site plan of this wetlands area is
attached.


 


The
contaminated soil remaining in the wetland area does not pose a health risk to
site occupants and does not require removal in order to comply with current
State or Federal regulations.


 


If
you have any questions or would like to discuss the project in further detail,
please call me at (860) 243-1757.


 


 


	
   

  	
  Very
  truly yours,

  
	
   

  	
  GEOQUEST, INC.

  
	
   

  	
   

  
	
   

  	
  /s/Marc
  I. Casslar

  
	
   

  	
   

  
	
   

  	
  Marc
  I. Casslar

  
	
   

  	
  President

  



 


Att.


 


3
Barnard Lane . P. O. Box 85. Bloomfield, Connecticut 06002 . (860) 243-1757
..  Fax: (860) 243-9414


 


93






 












 




	
  

  	
  SITE LAYOUT MAP
  Proposed Building Area to Remain GeoQuest, inc. P.O. Box 85 Bloomfield, CT
  Tel: (860) 243-1757 Fax: (860) 243-9414 Site Location 100 International Drive
  Windsor, CT Date February 2009 Project Number 1508 

  






 


94






 












 


Exhibit N


 


Missing Project Approvals


 


Building Permit


 


95

















 


Exhibit O


 


Required
Project Approvals


 


Building Permit


 


96

















 


Exhibit O


 


Permits and Approvals


 


1.     Wetland/Watercourse
Permit # 793A, Approved by Town of Windsor Inland Wetlands and Watercourses
Commission on November 19, 2008.


 


2.     Determination
of No Hazard to Air Navigation by Federal Aviation Administration, Air Traffic
Airspace Branch, Issue Date: 01/05/2009.


 


3.     Connecticut
Department of Environmental Protection, Water Discharge — Stormwater Permit
#GSN001460.


 


4.     Special Use and
Site Plan Revision Approvals by letter dated November 20, 2008 from the
Town of Windsor Planning and Zoning Commission.


 


5.     State of
Connecticut State Traffic Commission, STC No. 170-0812-01, Certificate No. 813-B,
approved December 16, 2008.


 


97

















 


Exhibit P


 


Existing Secured and Unsecured Indebtedness


 


None


 


98

















 


Exhibit Q


 


Authority,
Due Execution and Enforceability Opinion Requirements


 


The
opinion of counsel to the Borrower and the Guarantor as to the authority, due
execution and enforceability of the Loan Documents shall cover the following
matters:


 


(a)         The due organization, valid
existence and good standing of each of the Borrower and its Guarantor.


 


(b)         That each of the Borrower
and Guarantor have all requisite power to own their property and conduct its
business as now or proposed to be conducted, and to enter and perform its
obligations under the Loan Documents to which it is a party.


 


(c)          That the Borrower and
Guarantor are duly qualified to do business in the Commonwealth of
Massachusetts.


 


(d)         That each Loan Document to which
the Borrower and/or Guarantor are a party, have been duly executed and
delivered to the Lender and is the valid and legally binding obligation of the
Borrower and/or Guarantor enforceable in accordance with its terms, except as
enforceability is limited by bankruptcy, insolvency, reorganization, moratorium
or similar laws of general application affecting the rights of creditors or by
the discretionary nature of the remedy of specific performance.


 


(e)          That the Guaranty has been
duly executed and delivered to the Lender and is the legal, valid, binding and
enforceable obligations of the Guarantor, enforceable in accordance with its
terms, except as enforceability may be limited by bankruptcy, reorganization,
moratorium or similar laws of general application affecting the rights of
creditors or by the discretionary nature of the remedy of specific performance.


 


(f)           That the execution, delivery
and performance of each Loan Document to which the Borrower or the Guarantor is
a party and the transactions contemplated thereby (i) has been duly
authorized by all necessary proceedings on the part of such Person; (ii) does
not conflict with or result in any breach or contravention of any provision of
law, statute, rule or regulation to which such Person is subject or any
decree or judgment binding on such Person; (iii) does not conflict with
any provision of the applicable organization documents or by-laws of such
Person, or any indenture agreement or other instrument to which such Person is
a party, or which is binding upon such Person or on any of its properties, nor
will the same create any lien or security interest under or pursuant to any
such indenture agreement or other instrument (other than the Security
Documents); and (iv) does not require the approval or consent of, or
filing with, any governmental agency or authority.


 


99

















 


EXHIBIT R


 


AUTHORITY DUE EXECUTION AND ENFORCEABILITY OPINION REQUIREMENTS


 


The
opinion of counsel to the Borrower and the Guarantor as to the authority, due
execution and enforceability of the Loan Documents shall cover the following
matters:


 


(a) The
due organization, valid existence and good standing of each of the Borrower and
its Guarantor.


 


(b) That
each of the Borrower and Guarantor have all requisite power to own their  property and conduct is business as now or
proposed to be conducted, and to enter and perform its obligations under the
Loan Documents to which it is a party.


 


(c) That
the Borrower and Guarantor are duly qualified to do business in the State of
Connecticut.


 


100