Loan No.
33-0914051


 


PROMISSORY NOTE


 


	$24,406,000.00	New York, New York
	 	January 31, 2012


 


FOR
VALUE RECEIVED, ARC3 FEBMTNH001, LLC, a Delaware limited liability company ("NH Borrower"), and ARC3
ESBKYM0001, LLC, a Delaware limited liability company ("MO Borrower"; NH Borrower and MO Borrower, individually
and/or collectively, as the context may require, "Borrower"), each
having an address at 405 Park Avenue, 15th Floor,
New York, New York 10022, hereby unconditionally promise to pay to the order of WELLS
FARGO BANK, NATIONAL ASSOCIATION, having an address at Wells Fargo Center, 1901 Harrison Street, 2nd
Floor, MAC A0227-020, Oakland, California 94612 (together with its successors and/or assigns,
"Lender"), or at such other place as the holder hereof may from time
to time designate in writing, the principal sum of TWENTY FOUR MILLION FOUR HUNDRED
SIX THOUSAND AND NO/100 DOLLARS ($24,406,000.00), or so much thereof as is advanced,
in lawful money of the United States of America, with interest thereon to be computed
from the date of this Note at the Interest Rate, and to be paid in accordance with the terms of this Note and that certain
Loan Agreement dated the date hereof between Borrower and Lender (as the same may be amended,
restated, replaced, supplemented or otherwise modified from time to time, the "Loan Agreement"). All capitalized
terms not defined herein shall have the respective meanings set forth in the Loan Agreement.


 


ARTICLE
1: PAYMENT TERMS


 


Borrower
agrees to pay the principal sum of this Note and interest on the unpaid principal sum
of this Note from time to time outstanding at the rates and at the times specified in Article
2 of the Loan Agreement and the outstanding balance of the principal sum of this Note and all accrued and unpaid interest
thereon shall be due and payable on the Maturity Date.


 


ARTICLE
2: DEFAULT AND ACCELERATION


 


The Debt
shall without notice become immediately due and payable at the option of Lender upon the occurrence and during the continuance
of any Event of Default.


 


ARTICLE
3: LOAN DOCUMENTS


 


This
Note is secured by the Security Instrument and the other Loan Documents. All of the
terms, covenants and conditions contained in the Loan Agreement, the Security Instrument
and the other Loan Documents are hereby made part of this Note to the same extent and
with the same force as if they were fully set forth herein. In the event of a conflict or inconsistency
between the terms of this Note and the Loan Agreement, the terms and provisions of the Loan Agreement shall govern.


 



    	 



    	 



    

 


ARTICLE 4: SAVINGS
CLAUSE


 


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


 


ARTICLE
5: NO ORAL CHANGE


 


This Note may
not be modified, amended, waived, extended, changed, discharged or terminated orally or by any act or failure to act on the part
of Borrower or Lender, but only by an agreement in writing signed by the party against whom
enforcement of any modification, amendment, waiver, extension, change, discharge or termination is sought.


 


ARTICLE
6: WAIVERS


 


Borrower and all others
who may become liable for the payment of all or any part of the Debt do hereby severally waive presentment and demand for payment,
notice of dishonor, notice of intention to accelerate, notice of acceleration, protest and
notice of protest and non-payment and all other notices of any kind, except for any notices expressly required pursuant to the
Loan Documents. No release of any security for the Debt or extension of time for payment of
this Note or any installment hereof, and no alteration, amendment or waiver of any provision of this Note, the Loan Agreement or
the other Loan Documents made by agreement between Lender or any other Person shall release, modify, amend, waive, extend, change,
discharge, terminate or affect the liability of Borrower or any other Person who may
become liable for the payment of all or any part of the Debt under this Note, the Loan Agreement or the other Loan Documents.
No notice to or demand on Borrower shall be deemed to be a waiver of the obligation of Borrower or of the right of Lender
to take further action without further notice or demand as provided for in this Note, the
Loan Agreement or the other Loan Documents. If Borrower is a partnership or limited
liability company, the agreements herein contained shall remain in force and be applicable,
notwithstanding any changes in the individuals comprising the partnership or limited
liability company, and the term "Borrower," as used herein, shall include any
alternate or successor partnership or limited liability company, but any predecessor partnership
or limited liability company and their partners or members shall not thereby be released
from any liability. If Borrower is a corporation, the agreements contained herein shall remain
in full force and be applicable notwithstanding any changes in the shareholders comprising, or the officers and directors
relating to, the corporation, and the term "Borrower," as used herein, shall include
any alternative or successor corporation, but any predecessor corporation shall not
be relieved of liability hereunder. Nothing in the foregoing sentence shall be construed
as a consent to, or a waiver of, any prohibition or restriction on transfers of interests in
such partnership, limited liability company or corporation, which may be set forth in the Loan Agreement, the Security Instrument
or any other Loan Document.


 



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ARTICLE
7: TRANSFER


 


Upon
the transfer of this Note, Borrower hereby waiving notice of any such transfer, Lender
may deliver all the collateral mortgaged, granted, pledged or assigned pursuant to
the Loan Documents, or any part thereof, to the transferee who shall thereupon become vested with
all the rights herein or under applicable law given to Lender with respect thereto, and Lender
shall thereafter forever be relieved and fully discharged from any liability or responsibility
in the matter; but Lender shall retain all rights hereby given to it with respect to any liabilities and the collateral
not so transferred.


 


ARTICLE
8: EXCULPATION


 


The provisions
of Article 13 of the Loan Agreement are hereby incorporated by reference into this Note to the same extent and with the
same force as if fully set forth herein.


 


ARTICLE
9: GOVERNING LAW


 


(A)    THIS
NOTE WAS NEGOTIATED IN THE STATE OF NEW YORK, AND MADE BY BORROWER AND ACCEPTED BY
LENDER IN THE STATE OF NEW YORK, AND THE PROCEEDS OF THIS NOTE WERE DISBURSED FROM
THE STATE OF NEW YORK, WHICH STATE THE PARTIES AGREE HAS A SUBSTANTIAL RELATIONSHIP
TO THE PARTIES AND TO THE UNDERLYING TRANSACTION EMBODIED HEREBY, AND IN ALL RESPECTS,
INCLUDING, WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, MATTERS OF CONSTRUCTION,
VALIDITY AND PERFORMANCE, THIS NOTE AND THE OBLIGATIONS ARISING HEREUNDER SHALL BE GOVERNED
BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE
TO CONTRACTS MADE AND PERFORMED IN SUCH STATE (WITHOUT REGARD TO PRINCIPLES OF CONFLICT LAWS)
AND ANY APPLICABLE LAW OF THE UNITED STATES OF AMERICA. TO THE FULLEST EXTENT PERMITTED
BY LAW, BORROWER HEREBY UNCONDITIONALLY AND IRREVOCABLY WAIVES ANY CLAIM TO ASSERT THAT THE LAW OF ANY
OTHER JURISDICTION GOVERNS THIS NOTE AND THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK PURSUANT TO SECTION 5-1401 OF THE
NEW YORK GENERAL OBLIGATIONS LAW.


 


(B)    ANY
LEGAL SUIT, ACTION OR PROCEEDING AGAINST LENDER OR BORROWER ARISING OUT OF OR RELATING TO THIS NOTE MAY AT
LENDER'S OPTION BE INSTITUTED IN ANY FEDERAL OR STATE COURT IN THE CITY OF NEW YORK, COUNTY OF NEW YORK, PURSUANT TO SECTION 5-1402
OF THE NEW YORK GENERAL OBLIGATIONS LAW, AND BORROWER WAIVES ANY OBJECTIONS WHICH IT
MAY NOW OR HEREAFTER HAVE BASED ON VENUE AND/OR FORUM NON CONVENIENS OF ANY SUCH SUIT,
ACTION OR PROCEEDING, AND BORROWER HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY SUCH COURT IN ANY SUIT, ACTION
OR PROCEEDING. BORROWER DOES HEREBY DESIGNATE AND APPOINT:


 



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TIMOTHY
FITZGERALD


C/O BOND, SCHOENECK & KING, PLLC


350 LINDEN
OAKS, SUITE 310


ROCHESTER,
NEW YORK 14625


 


AS
ITS AUTHORIZED AGENT TO ACCEPT AND ACKNOWLEDGE ON ITS BEHALF SERVICE OF ANY AND ALL
PROCESS WHICH MAY BE SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING IN ANY FEDERAL OR STATE COURT IN NEW YORK,
NEW YORK, AND AGREES THAT SERVICE OF PROCESS UPON SAID AGENT AT SAID ADDRESS AND WRITTEN
NOTICE OF SAID SERVICE MAILED OR DELIVERED TO BORROWER IN THE MANNER PROVIDED HEREIN SHALL BE DEEMED IN EVERY RESPECT EFFECTIVE
SERVICE OF PROCESS UPON BORROWER IN ANY SUCH SUIT, ACTION OR PROCEEDING IN THE STATE OF NEW
YORK. BORROWER (I) SHALL GIVE PROMPT NOTICE TO LENDER OF ANY CHANGED ADDRESS OF ITS
AUTHORIZED AGENT HEREUNDER, (II) MAY AT ANY TIME AND FROM TIME TO TIME DESIGNATE A SUBSTITUTE AUTHORIZED AGENT WITH AN OFFICE
IN NEW YORK, NEW YORK (WHICH SUBSTITUTE AGENT AND OFFICE SHALL BE DESIGNATED AS THE PERSON
AND ADDRESS FOR SERVICE OF PROCESS), AND (III) SHALL PROMPTLY DESIGNATE
SUCH A SUBSTITUTE IF ITS AUTHORIZED AGENT CEASES TO HAVE AN OFFICE IN NEW YORK, NEW YORK OR IS DISSOLVED WITHOUT LEAVING
A SUCCESSOR.


 


ARTICLE
10: NOTICES


 


All notices or other written communications
hereunder shall be delivered in accordance with Article 14 of the Loan Agreement.


 


ARTICLE
11: SPECIAL NEW HAMPSHIRE PROVISIONS


 


(A)    Principles
of Construction. In the event of any inconsistencies between the terms and conditions
of this Article 11 and the terms and conditions of this Note, the terms and conditions of this Article 11 shall control
and be binding.


 


(B)    Instrument
Under Seal. This Note shall have the effect of an instrument executed under seal.


 


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TEXT ON THIS PAGE]


 



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IN
WITNESS WHEREOF, Borrower has duly executed this Promissory Note as of the day and
year first above written.


 


	 	BORROWER:
	 	 
	 	ARC3 FEBMTNH001, LLC, a Delaware limited liability company
	 	 	 
	 	By:	/s/ William M. Kahane
	 	Name: William M. Kahane
	 	Title: President


 


Promissory Note — Signature Page


 



    	 



    	 



    
 


	 	BORROWER:
	 	 
	 	ARC3 ESBKYM0001, LLC, a Delaware limited liability company
	 	 	 
	 	By:	/s/ William M. Kahane
	 	Name: William M. Kahane
	 	Title: President


 


Promissory Note — Signature Page