Exhibit 10.3


 


DRAFTED BY AND


WHEN RECORDED RETURN TO:


 


Ron M. Hadar


EMCAP Lending


1140 Reservoir Ave.


Cranston, RI 02920-6320


 


MORTGAGE,


ASSIGNMENT OF LEASES AND RENTS,
SECURITY AGREEMENT


AND FIXTURE FILING


 


THIS MORTGAGE, ASSIGNMENT
OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FILING (“Mortgage”) made as of July 30, 2021, PHR CHERRY PROPCO, LLC,
a Michigan limited liability company (“Mortgagee”), whose address is 1140 Reservoir Ave., Cranston, RI 02920-6320 (“Mortgagor”),
in favor of EMERALD CAPITAL LENDING III, LLC, a Delaware limited liability company (“Mortgagee”), whose address is
1140 Reservoir Ave., Cranston, RI 02920-6320.


 


RECITALS


 


As of this date, Mortgagor
and made and delivered a Promissory Note (the “Note”) to Mortgagee in the initial principal amount of Four Million and 00/100
Dollars ($4,000,000.00). As security for repayment of all sums due under the Note, Mortgagee has required and Mortgagor has agreed to
grant to Mortgagee this mortgage on a parcel of property located in Grand Traverse County, Michigan as more particularly described on
the attached Exhibit A.


 


NOW, THEREFORE, in consideration
of the foregoing premises and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and
to secure (i) the payment of the Indebtedness (as such term is defined below) and Impositions (as such term is defined below) and the
interest thereon, (ii) the payment of any advances or expenses of any kind incurred by Mortgagee pursuant to the provisions of or on account
of the Note or this Mortgage, (iii) the repayment of all Indebtedness arising under or in connection with the Note, (iv) the performance
of the obligations of the Mortgagor under the Note, and (v) the performance of the obligations of Mortgagor under the Note, the parties
hereby agree as follows:


 






     


     


    

 


ARTICLE
1 




 


GRANTING PROVISIONS


 


The Mortgagor does hereby
grant, bargain, sell, release, convey, assign, transfer, grant a security interest in, mortgage and warrant to Mortgagee, its successors
and assigns forever, all of the estate, title and interest of Mortgagor, in law or equity, in and to (a) the certain real estate located
in Grand Traverse County, Michigan, more particularly described in Exhibit A attached hereto, and (b) such real estate and
the buildings and improvements now existing, being constructed, or hereafter constructed or placed thereon, all of the rights, privileges,
licenses, easements and appurtenances belonging to such real estate (including all heretofore or hereafter vacated streets or alleys which
are about such real estate), and all fixtures of every kind whatsoever located in or on, or attached to, and used or intended to be used
in connection with or with the operation of such real estate, buildings, structures or other improvements thereon or in connection with
any construction now or to be conducted or which may be conducted thereon, together with all building materials and equipment now or hereafter
delivered to such real estate and intended to be installed therein; any rental revenues, payments, repayments, income, profits, charges,
accounts, general intangibles, and moneys derived by Mortgagor from the lease, sublease, sale, rental or other disposition of such property,
including, but not limited to, all rights conferred by Act No. 210 of the Michigan Public Acts of 1953, as amended (MCLA 554.231 et seq.),
and Act No. 228 of the Michigan Public Acts of 1925 as amended (MCLA 554.211 et seq.) (“Rents”) and subject to the terms and
conditions herein, the proceeds from any insurance proceeds or condemnation award pertaining thereto (the foregoing provisions shall constitute
an absolute and present assignment of the Rents and other benefits derived from the Property, subject however to the conditional permission
given to Mortgagor to collect and use such rentals, revenues and other benefits that are hereinabove provided until the occurrence of
an Event of Default and the existence or exercise of such right shall not operate to subordinate this assignment to any subsequent assignment,
in whole or in part, by the Mortgagor); and all extensions, additions, improvements, betterments, renewals, substitutions and replacements
to any of the foregoing, and the proceeds of any of the foregoing (all of the foregoing being hereinafter collectively called “Property”).


 


The Mortgagor further hereby
grants, conveys, and assigns to Mortgagee, its successors and assigns all rents, issues and profits of any of the foregoing and all proceeds
of the conversion (whether voluntary or involuntary) of any of the same into cash or liquidated claims, including, without limitation,
proceeds of Insurance and condemnation awards.


 


TO HAVE AND TO HOLD the Property
hereby conveyed, granted and assigned, unto Mortgagee, and its successors and assigns forever, for the uses and purposes herein set forth.


 


ARTICLE
2 




 


REPRESENTATIONS AND WARRANTIES


 


2.1             
General. Mortgagor represents and warrants that it is the sole lawful owner in fee
simple of the Property, that its title in and to the Property is free, clear and unencumbered except for those encumbrances, covenants
and restrictions of record, rights of tenants, as tenants only, under Leases (as hereinafter defined), hotel guests in occupancy, and
real estate taxes and assessments not yet due and payable (collectively, “Permitted Exceptons”); that it has good legal right,
authority, and full power to sell and convey the same and to execute this Mortgage; that Mortgagor will make any further assurances of
title that Mortgagee may reasonably require; that Mortgagor will, subject to the Permitted Exceptioins, warrant and defend the Property
against all claims and demands whatsoever, and that Mortgagor will keep and observe all of the terms of this Mortgage on Mortgagor's part
to be performed.


 






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COVENANTS


 


Mortgagor hereby covenants
and agrees with Mortgagee as follows:


 


2.2             
Indebtedness. Mortgagor will promptly pay and perform, or promptly cause to be paid
and performed, when due, the following obligations (hereinafter collectively called “Indebtedness”):


 


(a)              
each and every term, provision, condition, obligation, covenant, and agreement of Mortgagor
set forth in this Mortgage and the Note, and in any amendments, modifications or restatements to any of the foregoing; and


 


(b)              
all Protective Advances. The words “Protective Advance” mean an indebtedness or
obligation that is secured by this Mortgage and that arises because Mortgagee makes an expenditure or expenditures (i) to fulfill or perform
an obligation of Mortgagor under this Mortgage, with respect to the Property, that Mortgagor has failed to fulfill or perform, (ii) to
preserve the priority of this Mortgage and the value of the Property, or (iii) for reasonable attorney fees or other expenses that are
incurred in exercising a right or remedy under this Mortgage or that Mortgagor has agreed in this Mortgage to reimburse to Mortgagee.


 


2.3             
Impositions. Mortgagor will pay, or cause to be paid, before the same become delinquent,
all of the following (hereinafter collectively called “Impositions”): all real estate taxes, personal property taxes, assessments,
water and sewer rates and charges, and all other governmental levies and charges, of every kind and nature whatsoever, general and special,
ordinary and extraordinary, which are assessed, levied, confirmed, imposed or become a lien upon or against the Property or any portion
thereof, and all taxes, assessments and charges upon the rents, issues, income or profits of the Property, or which become payable with
respect thereto or with respect to the occupancy, use or possession of the Property, whether such taxes, assessments or charges are levied
directly or indirectly. Mortgagor shall deliver proof of payment of all such Impositions to Mortgagee upon the request of Mortgagee. Notwithstanding
any provision to the contrary in this Section 2.3, any tax or special assessment which is a lien on the Property may be paid in installments,
provided that each installment is paid on or prior to the date when the same is due without the imposition of any penalty.


 


2.4             
Compliance with Laws. Mortgagor will comply in all material respects with all federal,
state and local laws, regulations and orders to which the Property or the activities conducted on the Property are subject.


 


2.5             
Condition of Property. Mortgagor will maintain the Property in good order and condition
and make all repairs necessary to that end, will suffer no waste to the Property, and will cause all repairs and maintenance to the Property
to be done in a good and workmanlike manner.


 


2.6             
Improvements. Mortgagor will not remove or materially change any improvements once
installed or placed on the Property, or suffer or permit others to do so.


 






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2.7             
Insurance. Mortgagor at its sole cost and expense shall provide and keep in force (or
cause to be provided and kept in force) at all times with respect to the Property (with such deductibles as may be reasonably satisfactory
to Mortgagee, from time to time, in its reasonable discretion): (i) insurance against loss of or damage to the Improvements by fire and
other hazards covered by so-called “extended coverage” insurance, with a replacement cost endorsement, and such other casualties
and hazards as Mortgagee shall reasonably require from time to time; (ii) flood insurance in the maximum available amount if the Improvements
are located in a flood hazard area; (iii) business interruption insurance; (iv) boiler and machinery insurance; (v) comprehensive general
public liability insurance against claims for bodily injury, death or property damage in customary and adequate amounts; (vi) workers'
compensation insurance for all employees working at the Property, and, while the Property is under construction or repair, builder's risk
completed value insurance against “all risks of physical loss,” covering the total value of work performed and equipment,
supplies and materials furnished, and containing the “permission to occupy upon completion of work or occupancy” endorsement;
and (vii) such other Insurance on the Property (including, without limitation, increases in amounts and modifications of forms of insurance
existing on the date hereof), as Mortgagee may reasonably require from time to time. The policies of insurance required by this Section
2.7 may be provided in umbrella policies which insure any and all real or personal property in which Mortgagor has an interest in addition
to the Property. Mortgagor shall deliver to Mortgagee all insurance policies and certificates that are requested by Mortgagee. At least
thirty (30) days prior to the expiration of each policy required to be provided by Mortgagor, Mortgagor shall deliver certificates of
renewal policies to Mortgagee with appropriate evidence of payment of premiums therefore. All Insurance policies required by this Mortgage
shall (1) include effective waivers by the insurer of all rights of subrogation against any named insured and any other loss payee; (2)
provide that no cancellation, reduction in amount or material change in coverage thereof shall be effective until at least thirty (30)
days after receipt by Mortgagee of written notice thereof; and (3) be reasonably satisfactory in all other respects to Mortgagee. Mortgagor
shall not permit any activity to occur or condition to exist on or with respect to the Property that would wholly or partially invalidate
any of the insurance thereon. 


 


All proceeds of the insurance
required to be obtained by Mortgagor hereunder, other than those relating to the comprehensive general public liability insurance, shall
be held in trust for and paid promptly to Mortgagee, and Mortgagee may deduct from such proceeds any expenses, including, without limitation,
reasonable legal fees, incurred by Mortgagee in connection with adjusting and obtaining such proceeds (the balance remaining after such
deduction being hereinafter referred to as the "Net Insurance Proceeds"). Mortgagee may, at its option, either: (1) apply the
Net Insurance Proceeds in reduction or satisfaction of all or any part of the Indebtedness, whether then matured or not, in which event
Mortgagor shall be relieved of its obligation to maintain and restore the Property relating to such proceeds to the extent that Mortgagee
so applies such Net Insurance Proceeds; or (2) release the Net Insurance Proceeds to Mortgagor and Mortgagee shall apply any such Net
Insurance Proceeds to the restoration or reconstructing of the Property.


 


Without limiting Mortgagee's
rights under Section 3.9 of this Mortgage, if Mortgagor shall fail to keep the Property insured in accordance with this Mortgage and the
Note, Mortgagee may, but shall not be obligated to, do so, upon ten (10) days’ prior written notice to Mortgagor and if Mortgagor
fails to cure such insurance deficiency. Mortgagor shall reimburse Mortgagee on demand for amounts incurred or expended therefore, with
interest thereon pursuant to Section 3.9 hereof, and all such amounts incurred or expended, and all such interest thereon, shall be additional
Indebtedness of Mortgagor secured hereby.


 


2.8             
Sale, Transfer or Encumbrance.


 


(a)              
Except as permitted hereunder or following Mortgagee’s prior written consent, Mortgagor
will not further mortgage, sell or convey, or grant a deed of trust, pledge, or grant a security interest in any of the Property after
the date of this Mortgage, or contract to do any of the foregoing, or execute a land contract or installment sales contract, enter into
a lease (whether with or without option to purchase) or otherwise dispose of, further encumber or suffer the encumbrance of any of the
Property, whether by operation of law or otherwise. 


 






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(b)              
Mortgagor shall pay and discharge promptly, at Mortgagor's cost and expense, all liens, encumbrances,
and charges upon any part of the Property or any interest therein. If Mortgagor shall fail to discharge any such lien, encumbrance, or
charge, then, in addition to any other right or remedy of Mortgagee, Mortgagee may, but shall not be obligated to, discharge the same,
either by paying the amount claimed to be due, or by procuring the discharge of such lien by depositing in court a bond or the amount
claimed or otherwise giving security for such claim, or in such manner as is or may be prescribed by law.


 


(c)              
Mortgagor will not institute or cause to be instituted any proceedings that could change the
permitted use of the Property from the use presently zoned, and shall not grant any easements or licenses with respect to the Property.


 


(d)              
If a portion of the Property, or any beneficial interest therein, is sold, conveyed, transferred,
encumbered, or full possessor rights therein transferred, whether voluntarily, involuntarily or by operation of law, then the Mortgagee
may declare all sums secured by this Mortgage to be immediately due and payable, whether or not the Mortgagee has consented or waived
its rights in connection with any previous transaction of the same or a different nature. 


 


2.9             
Eminent Domain.


 


(a)              
Mortgagor shall give prompt notice to Mortgagee upon Mortgagor's obtaining knowledge of (i)
any interest on the part of any person possessing or who has expressed the intention to possess the power of eminent domain to purchase
or otherwise acquire the Property or (ii) the commencement of any action or proceeding to take the Property by exercise of the right of
condemnation or eminent domain or of any action or proceeding to close or to alter the grade of any street on or adjoining the Property.
At its option Mortgagee may participate in any such actions or proceedings in the name of Mortgagee or, whenever necessary, in the name
of Mortgagor, and Mortgagor shall deliver to Mortgagee such instruments as Mortgagee shall request to permit such participation. Mortgagor
shall not settle any such action or proceeding, whether by voluntary sale, stipulation or otherwise, or agree to accept any award or payment
without the prior written consent of Mortgagee, which consent shall not be unreasonably withheld. The total of all amounts awarded or
allowed with respect to all right, title and interest in and to the Property or the portion or portions thereof taken or affected by such
condemnation or eminent domain proceeding and any interest thereon (herein collectively called “Award”) is hereby assigned
to, and shall be paid upon receipt thereof, to Mortgagee and the amount received shall be retained and applied as provided in Paragraph
2.9(b) below, but only to the extent the Award has not previously been pledged and assigned to a priority mortgagee or secured party on
the Property.


 


(b)              
Upon Mortgagee's receipt of any Award, Mortgagee may, at its option, either: (i) retain and
apply the Award toward the Indebtedness; or (ii) subject to such escrow provisions as Mortgagee may require, pay the Award over in whole
or part to pay or reimburse Mortgagor for the cost of restoring or reconstructing the Property remaining after such taking (“Remaining
Property”). If Mortgagee elects to pay the Award, or any part thereof, over to Mortgagor upon the completion of the restoration
or reconstruction of the Remaining Property, any portion of the Award not used for the restoration or reconstruction of the Remaining
Property shall, at the option of Mortgagee, be applied in reduction of the Indebtedness; provided, however, that to the extent that such
portion of the Award shall exceed the amount required to satisfy in full the Indebtedness, Mortgagee shall pay the amount of such excess
to Mortgagor or otherwise as required by law. In no event shall Mortgagee be required to release this Mortgage until the Indebtedness
is fully paid and performed, nor shall Mortgagee be required to release from the lien of this Mortgage any portion of the Property so
taken until Mortgagee receives the Award for the portion so taken.


 






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(c)              
The application of the Award toward payment or performance of any of the Indebtedness shall
not be deemed a waiver by Mortgagee of its right to receive payment or performance of the balance of the Indebtedness in accordance with
the provisions of this Mortgage, the Note and in any amendments, modifications or restatements to any of the foregoing. Mortgagee shall
have the right, but shall be under no obligation, to question or appeal the amount of the Award, and Mortgagee may accept same without
prejudice to the rights that Mortgagee may have to question or appeal such amount. In any such condemnation or eminent domain action or
proceeding Mortgagee may be represented by attorneys selected by Mortgagee, and all sums paid by Mortgagee in connection with such action
or proceeding, including, without limitation, attorneys' fees, court costs, expenses and other charges relating thereto shall, on demand,
be immediately due and payable from Mortgagor to Mortgagee and the same shall be added to the Indebtedness and shall be secured by this
Mortgage. 


 


(d)              
Notwithstanding any taking by condemnation or eminent domain, closing of, or alteration of
the grade of, any street or other injury to or decrease in value of the Property by any public or quasi-public authority or corporation,
the Indebtedness shall continue to bear interest until the Award shall have been actually received by Mortgagee, and any reduction in
the Indebtedness resulting from the application by Mortgagee of the Award shall be deemed to take effect only on the date of such receipt
thereof by Mortgagee.


 


2.10         
Rights of Mortgagee. If Mortgagor fails to pay when due any Impositions when so required
by this Mortgage, or if an Event of Default occurs and is continuing under this Mortgage, Mortgagee may at its option (but shall not be
obligated to) pay such Impositions or cure such default. If Mortgagor fails to pay or perform any of its obligations under this Mortgage
with respect to the Property, Mortgagee at its option may (but shall not be obligated to) pay or perform any such obligations of Mortgagor.
Mortgagee may enter upon the Property for the purpose of performing any such act, or to inspect the Property, subject to the rights of
tenants and hotel guests. All Impositions paid by Mortgagee and all monies expended by Mortgagee in paying or performing any such obligations
of Mortgagor, or curing any Event of Default (including legal expenses and disbursements), shall bear interest at a floating rate per
annum equal to six percent (6%) in excess of the Prime Rate of Fifth Third Bank then in effect, and such interest shall be paid by Mortgagor
upon demand by Mortgagee and shall be additional Indebtedness secured by this Mortgage.


 


2.11         
Conflict Among Agreements. In the event of any conflict between the provisions of this
Mortgage and the provisions of the Note, the provisions of the Note shall prevail.


 


2.12         
Notifications. Mortgagor shall notify Mortgagee promptly of the occurrence of any of
the following:


 


(a)              
a fire or other casualty causing damage to the Property in excess of $5,000;


 


(b)              
receipt of notice of condemnation of the Property or any part thereof;


 


(c)              
receipt of notice from any governmental authority relating to the structure, use or occupancy
of the Property;


 


(d)              
receipt of any notice of alleged default from the holder of any lien or security Interest
in the Property;


 


(e)              
the commencement of any litigation affecting the Property; 


 


(f)               
any change in the occupancy of the Property; or


 






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(g)              
any cancellation or expiration of the insurance required to be maintained in accordance with
Section 2.7 hereof.


 


2.13         
Hazardous Substances. 


 


(a)              
As used in this Section: (i) “Hazardous Substances”: are those substances defined
as toxic or hazardous substances, pollutants, or wastes by Environmental Law and the following substances: gasoline, kerosene, other flammable
or toxic petroleum products, toxic pesticides and herbicides, volatile solvents, materials containing asbestos or formaldehyde, and radioactive
materials; (ii) “Environmental Law” means federal laws and laws of the jurisdiction where the Property is located that relate
to health, safety or environmental protection; (iii) “Environmental Cleanup” includes any response action, remedial action,
or removal action, as defined in Environmental Law; (iv) an “Environmental Condition” means a condition that can cause, contribute
to, or otherwise trigger an Environmental Cleanup; (v) the terms “Release”, “Owner,” “Operator,” “Environment,”
and “Natural Resources” shall have the same meanings and definitions as set forth in the Comprehensive Environmental Response
Compensation and Liability Act as amended, 42 U.S.C. §9601 et seq. and regulations promulgated thereunder (collectively “CERCLA”)
and any corresponding state or local law or regulation, provided, however, that as used herein the term Hazardous Substance shall also
include: (A) any Pollutant or Contaminant as defined by CERCLA or by any other Environmental Law; (B) any Solid Waste, Hazardous Constituent
or Hazardous Waste as defined by, or as otherwise identified by, the Resource Conservation and Recovery Act as amended 42 U.S.C. §6901
et seq. or regulations promulgated thereunder (collectively, “RCRA”) or by any other Environmental Law; and (C) crude oil,
petroleum, and fractions or distillates thereof; and (vi) the terms “Storage,” “Treatment,” and “Disposal,”
shall have the same meanings and definitions as set forth in RCRA.


 


(b)              
Mortgagor shall not cause or permit the presence, use, disposal, storage, or release of any
Hazardous Substances, or threaten to release any Hazardous Substances, on or in the Property, which results in the violation of any Environmental
Law. Mortgagor shall not do, nor allow anyone else to do, anything affecting the Property (I) that is in violation of any Environmental
Law, (ii) which creates an Environmental Condition, or (iii) which, due to the presence, use, or release of a Hazardous Substance, creates
a condition that materially and adversely affects the value of the Property. The preceding two sentences shall not apply to the presence,
use, or storage on the Property of small quantities of Hazardous Substances that are generally recognized to be appropriate to normal
uses and to maintenance of the Property (including, but not limited to, Hazardous Substances in consumer products).


 


(c)              
Mortgagor shall promptly give Mortgagee written notice of (i) any investigation, claim, demand,
lawsuit or other action by any governmental or regulatory agency or private party involving the Property and any Hazardous Substance or
Environmental Law of which Mortgagor has actual knowledge, (ii) any Environmental Condition, including but not limited to, any spilling,
leaking, discharge, release or threat of release of any Hazardous Substance, and (iii) any condition caused by the presence, use or release
of a Hazardous Substance which materially and adversely affects the value of the Property. If Mortgagor learns, or is notified by any
governmental or regulatory authority, or any private party, that any removal or other remediation of any Hazardous Substance affecting
the Property is necessary, Mortgagor shall promptly take all necessary remedial actions in accordance with Environmental Law. Nothing
herein shall create any obligation on Mortgagee for an Environmental Cleanup.


 


(d)              
The Mortgagor hereby agrees to release, hold harmless, defend and indemnify Mortgagee from,
for and against all actual or threatened claims, costs (including but not limited to the cost of investigation, removal, remediation and
other cleanup of Hazardous Substances, and reasonable fees of attorneys and other professionals, experts and consultants retained by Mortgagee)
demands, orders, losses, lawsuits, liabilities, damages (excluding all consequential damages other than to the extent actually incurred
by Mortgagee as a result of a third party claim) and expenses whether brought collectively or individually by Mortgagor, a governmental
authority or any other third party (all the foregoing hereinafter collectively referred to as “Losses”) arising from or related
to any of the following:


 






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(i)             
The past, present or future Release, threatened Release, Storage, Treatment, accumulation,
generation, utilization, Disposal, transportation or other handling or migration of any Hazardous Substance on, in, onto, or from the
Property.


 


(ii)             
The violation or alleged violation of Environmental Laws occurring on or related to the Property.


 


(iii)           
Any action taken by Mortgagee to eliminate, prevent, or mitigate the potential adverse impact
on the Real Estate or the Mortgagee as a result of or in anticipation of any actual, suspected or threatened violation of Environmental
Laws or Release or threatened Release of a Hazardous Substance on, in or from or otherwise affecting the Property; such action may include
but need not be limited to, the disposition, distribution, sale, disclaimer, or renunciation or any portion of the Real Estate.


 


(iv)            
The costs of any required or necessary repair, cleanup or detoxification of the Property and
the preparation and implementation of any closure, remedial or other required plans.


 


Clauses (d)(i) through (iv) above are hereinafter
referred to collectively as “Environmental Matters.”


 


(e)              
The Mortgagor hereby agrees that Mortgagee shall be reimbursed directly by the Mortgagor or
if a sale of all or part of the Real Estate occurs, from the Real Estate or proceeds thereof for any Losses suffered or sustained or threatened
to be suffered or sustained by Mortgagee as a result of Environmental Matters, until such time as the Mortgagee has been reimbursed in
full.


 


(f)               
This indemnity shall survive the release of the lien of this Mortgage, or the extinguishment
of the lien by foreclosure or deed in lieu thereof or by any other action. The foregoing covenant regarding survival shall survive such
release or extinguishment. Notwithstanding anything in this Mortgage to the contrary, Mortgagor’s indemnity obligations shall not
apply to matters relating to or arising from Mortgagee’s own negligence or misconduct, and under no circumstances shall Mortgagor
be liable for punitive or consequential damages.


 


ARTICLE
3 




 


EVENTS OF DEFAULT


 


Any of the following events
shall be an Event of Default:


 


3.1             
Cross-Default. A default beyond any applicable notice and cure period occurs under



 


(a)              
any of the Note or in any amendments, modifications or restatements to any of the foregoing.



 


3.2             
Breach of Covenants. Mortgagor defaults in the performance or observance of any of
the following covenants:


 


(a)              
to maintain in force the insurance required by Section 2.7 (Insurance) of this Mortgage;


 






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(b)              
to comply with any of the notice requirements set forth in Section 2.9 (Insurance), Section
3.8 (Eminent Domain) or Section 2.12 (Notifications) of this Mortgage; or


 


(c)              
any other covenant or agreement contained in this Mortgage and such default continues for
30 days after notice thereof from Mortgagee.


 


3.3             
Representation or Warranty. Any representation or warranty of the Mortgagor under this
Mortgage or any other Loan Document is untrue or misleading in any material respect.


 


3.4             
Foreclosure. A foreclosure proceeding (whether judicial or otherwise) is instituted
with respect to any mortgage or lien of any kind encumbering any portion of the Property (other than by Mortgagee).


 


3.5             
Other Obligations. Any default occurs under any other obligation of Mortgagor to Mortgagee
or otherwise described herein as Indebtedness.


 


3.6             
Waste. Mortgagor shall fail to pay taxes and/or assessments assessed against the Property
or any installment thereof, or any insurance premiums or policies covering the Property, or any part thereof shall constitute waste (although
the meaning of the term “waste” shall not necessarily be limited to such nonpayment), as provided by Act No. 236 of the Public
Acts of Michigan of 1961, as amended, and shall entitle Mortgagee to all remedies provided for therein. Mortgagor further agrees to and
does hereby consent to the appointment of a receiver under such statute, should Mortgagee elect to seek such relief thereunder. 


 


ARTICLE
4 




 


REMEDIES


 


4.1             
Remedies. Upon the occurrence, and until the waiver by Mortgagee, of an Event of Default:



 


(a)              
Mortgagee may declare the entire balance of the Indebtedness to be immediately due and payable,
and upon any such declaration, the entire unpaid balance of the Indebtedness shall become and be immediately due and payable, without
presentment, demand, protest or further notice of any kind, all of which are hereby expressly waived by Mortgagor.


 


(b)              
Mortgagee may institute a proceeding or proceedings, judicial or otherwise, for the complete
or partial foreclosure of this Mortgage under any applicable provision of law.


 


(c)              
Mortgagee may institute a proceeding or proceedings to eject Mortgagor from possession of
the Property and to obtain possession of the Property by Mortgagee, with or without instituting a foreclosure proceeding.


 


(d)              
Mortgagee may sell (the power of sale, if permitted and provided by applicable law, being
expressly granted by Mortgagor to Mortgagee) the Property, and all estate, right, title, interest, claim and demand of Mortgagor therein,
and all rights of redemption thereof, at one or more sales, as an entirety or in parcels, with such elements of real and/or personal property,
and at such time and place and upon such terms as Mortgagee may deem expedient, or as may be required by applicable law, and In the event
of a sale, by foreclosure or otherwise, of less than all of the Property, this Mortgage shall continue as a lien and security interest
on the remaining portion of the Property. Mortgagee is hereby authorized and empowered to sell the Property, or cause the same to be sold
and to convey the same to the purchaser in any lawful manner, including but not limited to that provided by Chapter 32 of the Revised
Judicature Act of Michigan, entitled “Foreclosure of Mortgage by Advertisement,” which permits the Mortgagee to sell the Property
without affording the Mortgagor a hearing, or giving it actual personal notice. The only notice required under such Chapter 32 is to publish
notice in a local newspaper and to post a copy of the notice on the Property.


 






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(e)              
WAIVER: BY CONFERRING THIS POWER OF SALE UPON THE MORTGAGEE, THE MORTGAGOR, FOR ITSELF, ITS
SUCCESSORS AND ASSIGNS, AFTER AN OPPORTUNITY FOR CONSULTATION WITH ITS LEGAL COUNSEL, HEREBY VOLUNTARILY, KNOWINGLY AND INTELLIGENTLY
WAIVES ALL RIGHTS UNDER THE CONSTITUTION AND LAWS OF THE UNITED STATES AND UNDER THE CONSTITUTION AND LAWS OF THE STATE OF MICHIGAN, BOTH
TO A HEARING ON THE RIGHT TO EXERCISE AND THE EXERCISE OF THE POWER OF SALE, AND TO NOTICE EXCEPT AS REQUIRED BY THE MICHIGAN STATUTE
WHICH PROVIDES FOR FORECLOSURE OF MORTGAGES BY ADVERTISEMENT.


 


(f)               
Mortgagee may institute an action, suit or proceeding in equity for the specific performance
of any of the provisions contained in this Mortgage, the Note and in any amendments, modifications or restatements to any of the foregoing.


 


(g)              
Mortgagee may apply for the appointment of a receiver, custodian, trustee, liquidator or conservator
of the Property and the Rents to be vested with the fullest powers permitted under applicable law, as a matter of right and without regard
to, or the necessity to disprove, the adequacy of the security for the Indebtedness or the solvency of Mortgagor or any other person liable
for the payment of the Indebtedness, and Mortgagor and each such person liable for the payment of the Indebtedness consents or shall be
deemed to have consented to such appointment. Nonpayment of any taxes, assessments, insurance or any utility rates levied, assessed or
imposed on all or any part of the Property shall constitute waste and entitle the Mortgagee to exercise the remedies afforded by Section
2927 of the Michigan Revised Judicature Act of 1961 (MCL 600.2927), as now or hereafter amended, or by any other statute or law now or
hereafter in effect.


 


(h)              
To the extent permitted by law, Mortgagee may enter upon the Property, and exclude Mortgagor
and its agents and servants wholly therefrom, without liability for trespass, damages or otherwise, and take possession of all books,
records and accounts relating thereto and all other Property; and having and holding the same Mortgagee may use, operate, manage, preserve,
control and otherwise deal therewith and conduct the business thereof, without interference from Mortgagor; and upon each such entry and
from time to time thereafter Mortgagee may, at the expense of Mortgagor and the Property, without interference by Mortgagor and as Mortgagee
may deem advisable, (i) insure or reinsure the Property, (ii) make all necessary or proper repairs, renewals, replacements, alterations,
additions, betterments and improvements thereto and thereon and (iii) in every such case in connection with the foregoing have the right
to exercise all rights and powers of Mortgagor with respect to the Property, either in Mortgagor's name or otherwise.


 


(i)                
Mortgagee may, with or without entering upon the Property, collect, receive, sue for and recover
in its own name all Rents and cash collateral derived from the Property, and may deduct therefrom alt costs, expenses and liabilities
of every character incurred by Mortgagee in controlling the same and in using, operating, managing, preserving and controlling the Property,
and otherwise in exercising Mortgagee's rights under this Mortgage or the other Note, including, but not limited to, all amounts disbursed
to pay Impositions, insurance premiums and other charges in connection with the Property, as well as compensation for the services of
Mortgagee and its respective attorneys, agents and employees. Mortgagee may release any portion of the Property for such consideration
as Mortgagee may require without, as to the remainder of the Property, in any way impairing or affecting the position of Mortgagee with
respect to the balance of the Property; and Mortgagee may accept by assignment, pledge or otherwise any other property in place thereof
as Mortgagee may require without being accountable for so doing to any other lien holder.


 






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(j)                
Mortgagee may take all actions, or pursue any other right or remedy, permitted under the Uniform
Commercial Code in effect in the State in which the Property is located, under any other applicable law or in equity.


 


4.2             
Mortgagee's Cause of Action. Mortgagee shall have the right, from time to time, to
bring an appropriate action to recover any sums required to be paid by Mortgagor under the terms of this Mortgage, and/or the other Note,
as the same become due, without regard to whether or not the principal indebtedness or any other sums secured by this Mortgage, and/or
the other Note, shall be due, and without prejudice to the right of Mortgagee thereafter to institute foreclosure or otherwise dispose
of the Property or any part thereof, or any other action, for any default by Mortgagor existing at the time the earlier action was commenced.


 


4.3             
Costs and Expenses. There shall be allowed and included as additional Indebtedness
secured by the lien of this Mortgage, to the extent permitted by law, all expenditures and expenses of Mortgagee for attorneys' fees,
court costs, appraisers' fees, sheriff's fees, documentary and expert evidence, stenographers' charges, publication costs and such other
costs and expenses as Mortgagee may deem reasonably necessary to exercise any remedies or to evidence to bidders at any sale of the Property
the true condition of the title to or the value of the Property. All such expenditures and expenses shall bear interest at a floating
rate per annum equal to six percent (6%) in excess of the Prime Rate of Fifth Third Bank then in effect, and such interest shall be paid
by Mortgagor upon demand by Mortgagee and shall be additional Indebtedness secured by this Mortgage.


 


4.4             
Proceeds. The proceeds received by Mortgagee in any foreclosure sale of the Property
shall be distributed and applied in the following order of priority: first, on account of all costs and expenses incident to the foreclosure
proceedings, including all such items as are mentioned in Section 4.3; second, to all other items which under the terms hereof constitute
Indebtedness or Impositions; and, third, any surplus to Mortgagor, its legal representatives or assigns, or to third persons with rights
to the proceeds, as their rights may appear.


 


4.5             
Receiver. Without limiting the application of Section 5.1 of this Mortgage, upon, or
at any time after, the filing of a suit to foreclose this Mortgage, Mortgagee shall be entitled to have a court appoint a receiver of
the Property. Such appointment may be made either before or after sale, without notice to Mortgagor or any other person, without regard
to the solvency of the person or persons, if any, liable for the payment of the Indebtedness and without regard to the then value of the
Property, and Mortgagee may be appointed as such receiver. The receiver shall have the power to collect the rents, issues and profits
of the Property during the pendency of such foreclosure suit, as well as during any further times when Mortgagee, absent the intervention
of such receiver, would be entitled to collect such rents, issues and profits, and all other powers which may be necessary or are usual
in such cases for the protection, possession, control, management and operation of the Property during the whole of such period. The court
from time to time may authorize the receiver to apply net income in the Receiver's hands in payment in whole or in part of the Indebtedness,
or in payment of any tax, assessment or other lien that may be or become superior to the lien hereof or superior to a decree foreclosing
this Mortgage, provided such application is made prior to foreclosure sale. The receiver shall have the power to collect the rents, issues,
and profits of the Property during the pendency of such foreclosure suit, as well as during any further times when Mortgagee, absent the
intervention of such receiver, would be entitled to collect such rents, issues, and profits, and exercise all other powers including those
that may be necessary or are usual in such cases for the protection, possession, control, management, and operation of the Property during
the whole of such period, and may operate the Property, prepare the Property for sale, market the Property, list the Property for sale,
negotiate and execute sales agreements for the Property, and sell the Property.


 






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4.6             
Rights Cumulative. The rights of Mortgagee arising under the provisions and covenants
contained in each of the Mortgage, and/or the other Note shall be separate, distinct and cumulative, and none of them shall be exclusive
of the others. In addition to the rights set forth in this Mortgage or any other Note, Mortgagee shall have all rights and remedies now
or hereafter existing at law or in equity or by statute. Mortgagee may pursue its rights and remedies concurrently or in any sequence,
and no act of Mortgagee shall be construed as an election to proceed under any one provision herein or in such other documents to the
exclusion of any other provision, anything herein or otherwise to the contrary notwithstanding. Without notice to or consent of Mortgagor
and without impairment of the lien and rights created by this Mortgage, the Mortgagee may accept from Mortgagor or from any other person
or persons, additional security for the indebtedness secured by this Mortgage. Neither the giving of this Mortgage nor the acceptance
of any such additional security shall prevent the Mortgagee from resorting, first, to such additional security, or second, to the security
created by this Mortgage, in either case without affecting the lien hereof and the rights conferred hereunder. If Mortgagor falls to comply
with this Mortgage, no remedy of law will provide adequate relief to Mortgagee, and Mortgagee shall be entitled to temporary and permanent
injunctive relief without the necessity of proving actual damages.


 


4.7             
No Merger. If Mortgagee shall at any time hereafter acquire title to any of the Property,
then the lien of this Mortgage shall not merge into such title, but shall continue in full force and effect to the same extent as if the
Mortgagee had not acquired title to any of the Property. Furthermore, if the estate of the Mortgagor shall be a leasehold, unless the
Mortgagee shall otherwise consent, the fee title of the Property shall not merge with such leasehold, notwithstanding the union of said
estates either in the ground lessor or in the fee owner, or in a third party, by purchase or otherwise. 


 


4.8             
Waivers of Mortgagor. Mortgagor hereby waives the benefit of any stay, moratorium,
valuation or appraisal law or judicial decision, any defects in any proceeding instituted by Mortgagee with respect to this Mortgage,
and/or any of the other Note, and any right of redemption with respect to the Property. Mortgagor waives any right to require marshalling
of assets in connection with enforcement of Indebtedness and any right to require the sale of the Property in parcels or in a single parcel
to select the order in which parcels are to be sold or to require a minimum bid or “upset” price. Mortgagor waives the right
to all notices to which Mortgagor may otherwise be entitled, except those expressly provided for herein. No delay on Mortgagee's part
in exercising any power of sale, lien, option or other right with respect to the Property, and no notice or demand which may be given
to or made upon the Mortgagor by Mortgagee with respect to any power of sale, lien, option or other right with respect to the Property,
shall constitute a waiver thereof, or limit or impair Mortgagee's right to take any action or to exercise any power of sale, lien option,
or any other right with respect to the Property without notice or demand, or prejudice Mortgagee's rights as against the Mortgagor in
any respect. In addition, no action taken by Mortgagee with respect to the Property shall in any way impair or limit Mortgagee's right
to exercise any or all rights or remedies Mortgagee may otherwise have against Mortgagor with respect to any Indebtedness. This Mortgage
shall not, in any manner, be construed as a compromise of any Indebtedness. The pledge of, and security interest in, the Property by the
Mortgagor to Mortgagee are absolute, unconditional and continuing and will remain in full force and effect until the Indebtedness have
been fully paid and satisfied. The pledge of, and security interest in, the Property will extend to and cover renewals of the Indebtedness
and any number of extensions of time for payment thereof and will not be affected by any surrender, exchange, acceptance or release by
the Mortgagee of any other pledge or any security held by it for any of the Indebtedness. Notice of acceptance of the pledge and security
interest, notice of extensions of credit to the Mortgagor from time to time, notice of default, diligence, presentment, protest, demand
for payment, notice of demand or protest, notice of making, renewing or extending any of the Indebtedness and any defense based upon a
failure of Mortgagee to comply with the notice requirements of the applicable version of Uniform Commercial Code are hereby waived. Mortgagee
in its sole discretion may determine the reasonableness of the period which may elapse prior to the making of demand for any payment upon
the Mortgagor or any guarantor and it need not pursue any of its remedies against any other party before having recourse against the Property.


 






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THE UNDERSIGNED AND THE MORTGAGEE
ACKNOWLEDGE THAT THE RIGHT TO TRIAL BY JURY IS A CONSTITUTIONAL ONE, BUT THAT IT MAY BE WAIVED. EACH PARTY, AFTER CONSULTING (OR HAVING
HAD THE OPPORTUNITY TO CONSULT) WITH COUNSEL OF THEIR CHOICE, KNOWINGLY AND VOLUNTARILY, AND FOR THEIR MUTUAL BENEFIT, WAIVES ANY RIGHT
TO TRIAL BY JURY IN THE EVENT OF LITIGATION REGARDING THE PERFORMANCE OR ENFORCEMENT OF, OR IN ANY WAY RELATED TO, THIS MORTGAGE OR THE
INDEBTEDNESS.


 


ARTICLE
5 




 


MISCELLANEOUS


 


5.1             
Uniform Commercial Code Security Agreement. This Mortgage is intended to be a security
agreement pursuant to the Uniform Commercial Code as adopted in the state where the Property is located for any of the items specified
above as part of the Property which may be subject to a security interest pursuant to the applicable version of the Uniform Commercial
Code, and Mortgagor hereby grants Mortgagee a security interest in such items. Mortgagor agrees that Mortgagee may file this mortgage
instrument, or a reproduction thereof, in the real estate records or other appropriate index, as a financing statement for any of the
items specified above as part of the Property. Any reproduction of this Mortgage shall be sufficient as a financing statement. In addition,
Mortgagor authorizes to Lender to file any financing statements that Mortgagee may require to perfect a security interest with respect
to said items. Mortgagor shall pay all costs of filing such financing statement and any extensions, renewals, amendments and releases
thereof, and shall pay all reasonable costs and expenses of any record searches for financing statements Mortgagee may require. Without
the prior written consent of Mortgagee, Mortgagor shall not create or suffer to be created pursuant to the Uniform Commercial Code any
other security interest in such items, including replacements and additions thereto. Upon the occurance and during the continuance of
any Event of Default under this Mortgage, Mortgagee shall have the remedies of a secured party under the Uniform Commercial Code and,
at Mortgagee's option, may also invoke the remedies provided in this Mortgage. In exercising any of said remedies, Mortgagee may proceed
against the items of real property and any items of personal property specified above as part of the Property separately or together and
in any order whatsoever, without in any way affecting the availability of Mortgagee's remedies under the Uniform Commercial Code or of
the remedies in this Mortgage. Mortgagor further authorizes Mortgagee to File UCC Financing Statements on behalf of Mortgagor and Mortgagee
with respect to the Property. For purposes of this fixture filing, the “Debtor” is the Mortgagor and the “Secured Party”
is the Mortgagee. A description of the land which relates to the fixtures is set forth in Exhibit A attached hereto. Mortgagor
is the record owner of such land. The respective addresses of Mortgagor as debtor, and of Mortgagee, as secured party from which information
concerning the security interest may be obtained, are as set forth in the preamble to this Mortgage. The name of the record owner, or
in the case of chattel leases, lessee, of the subject property is Mortgagor.


 


5.2             
Waiver. No delay or omission by Mortgagee to exercise any right shall impair any such
right or be a waiver thereof, but any such right may be exercised from time to time and as often as may be deemed expedient. Each waiver
must be in writing and executed by Mortgagee to be effective, and a waiver on one occasion shall be limited to that particular occasion.


 






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5.3             
Amendments in Writing. No change, amendment, or modification hereof, or any part hereof,
shall be valid unless in writing and signed by the parties hereto or their respective successors and assigns.


 


5.4             
Notices. All notices, demands and requests given or required to be given by either
party hereto to the other party shall be in writing and shall be deemed to have been properly given if sent by U.S. registered or certified
mail, postage prepaid, return receipt requested, or by overnight delivery service, addressed as follows:


 


		To Mortgagor:	PHR CHERRY PROPCO, LLC
	 	 	1140 Reservoir Ave.
	 	 	Cranston, RI 02920-6320
	 	 	 
	 	To Mortgagee:	EMERALD CAPITAL LENDING
III, LLC
	 	 	1140 Reservoir Ave.
	 	 	Cranston, RI 02920-6320



 


or to such other address as Mortgagor or Mortgagee may from time to
time designate by written notice.


 


5.5             
Interpretation. The titles to the Sections and Paragraphs hereof are for reference
only and do not limit in any way the content thereof. Any words herein which are used in one gender shall be read and construed to mean
or Include the other gender wherever they would so apply. Any words herein which are used in the singular shall be read and construed
to mean and to include the plural wherever they would so apply, and vice versa.


 


5.6             
Covenant Running With the Land. Any act or agreement to be done or performed by Mortgagor
shall be construed as a covenant running with the land and shall be binding upon Mortgagor and its successors and assigns as if they had
personally made such agreement.


 


5.7             
Complete Agreement: Counterparts. This Mortgage and the Exhibits are the complete agreement
of the parties hereto and supersede all previous understandings relating to the subject matter hereof. This Mortgage may be amended only
by an instrument in writing which explicitly states that it amends this Mortgage, and is signed by the party against whom enforcement
of the amendment is sought. This Mortgage may be executed in several counterparts, each of which shall be regarded as an original and
all of which shall constitute but one and the same instrument.


 


5.8             
Validity. The provisions of this Mortgage are severable. If any term, covenant or condition
of this Mortgage shall be held to be invalid, illegal or unenforceable in any respect, the remainder of this Mortgage shall not be invalidated
thereby, and this Mortgage shall be construed without such provision.


 


5.9             
Governing Law. This Mortgage for all purposes shall be construed and enforced in accordance
with the domestic laws of the State of Michigan.


 


5.10         
Assignment. This Mortgage shall be binding upon and inure to the benefit of the respective
legal representatives, successors and assigns of the parties hereto; however, Mortgagor may not assign any of its rights or delegate any
of its obligations hereunder. Mortgagee may assign this Mortgage to any other person, firm, or corporation provided all of the provisions
hereof shall continue In force and effect and, in the event of such assignment, any advances made by any assignee shall be deemed made
in pursuance and not in modification hereof and shall be evidenced and secured by, the Note and this Mortgage.


 






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5.11         
Interest. In no event shall the interest rate and other charges related to the Indebtedness
exceed the highest rate permissible under any law which a court of competent jurisdiction shall, in a final determination, deem applicable
hereto. In the event that a court determines that Mortgagee has received interest and other charges hereunder in excess of the highest
permissible rate applicable hereto, such excess shall be deemed received on account of, and shall automatically be applied to reduce,
the principal balance of the Indebtedness, and the provisions hereof shall be deemed amended to provide for the highest permissible rate.
If there is no Indebtedness outstanding, Mortgagee shall refund to Mortgagor such excess.


 


5.12         
Mortgagee's Status. Mortgagor hereby acknowledges and agrees that the undertaking of
Mortgagee under this Mortgage is limited as follows:


 


Mortgagee shall not act
in any way as the agent for or trustee of Mortgagor. Mortgagee does not intend to act in any way for or on behalf of Mortgagor with respect
to disbursement of the proceeds of the indebtedness secured hereby. Mortgagee's intent in imposing the requirements set forth herein and
in the Note is that of a lender protecting the priority of its mortgage and the value of its security. Mortgagee assumes no responsibility
for the completion of any Improvements erected or to be erected upon the Property; the payment of bills or any other details in connection
with the Property; any plans and specifications in connection with the Property; or Mortgagor's relations with any contractors. This Mortgage
is not to be construed by Mortgagor or anyone furnishing labor, materials, or any other work or product for improving the Property as
an agreement upon the part of the Mortgagee to assure anyone that such person will be paid for furnishing such labor, materials, or any
other work or product; any such person must look entirely to Mortgagor for such payment. Mortgagee assumes no responsibility for the architectural
or structural soundness of any improvements on or to be erected upon the Property or for the approval of any plans and specifications
in connection therewith or for any improvements as finally completed.


 


ARTICLE
6 




 


ASSIGNMENT OF RENTS AND LEASES


 


6.1             
Assignment of Rents. Mortgagor hereby grants, transfers, and assigns and sets over
to Mortgagee all right, title and interest in and to, all rents, issues, profits and privileges (now due or which may hereafter become
due) of, (a) the property and all improvements at any time constructed thereon or any personal property or fixtures at any time installed
or used therein, (b) all leases now or hereafter existing on all or any part of the Property, whether written or oral, or any letting
or any agreement for the use or occupancy of any part of the Property (but excluding the rental of guest rooms in the ordinary course)
which may heretofore have been or which may hereafter be made or agreed to between Mortgagor or any other present, prior, or subsequent
owner of the Property, or any interest therein, or which may be made or agreed to by Mortgagee, its successors or assigns, under the powers
herein granted and any tenant or occupant of all or any part of the Property (“Leases” and each, “Lease”), including
without limitation any Leases existing as of the date of this Mortgage (“Existing Leases”), (c) all rights conferred by and
pursuant to Act No. 210 of the Michigan Public Act of 1953, as amended, and Act No. 228 of the Michigan Public Acts of 1925 as amended,
and (d) all proceeds of the foregoing, all for the purpose of securing the prompt payment, performance and discharge, when due, of the
Indebtedness. So long as no Event of Default has occurred and is continuing, Mortgagor may, as trustee for the use and benefit of Mortgagee,
collect, receive and accept the rents as they become due and payable; provided, however, that if the rents exceed the payments due under
the Note, the Mortgagor may use such excess, first, for the operation and benefit of the Property and, second, for the general benefit
of the Mortgagor, which may include distributing cash to the equity owners of Mortgagor. Upon the occurrence and during the continuance
of an Event of Default, Mortgagee may, at its option, remove the Mortgagor as trustee for the collection of the rents and appoint any
other person including, but not limited to, itself as a substitute trustee to collect, receive, accept and use all such rents in payment
of the obligations secured hereby, in such order as Mortgagee shall elect in its sole discretion, whether or not Mortgagee takes possession
of the Property. 


 






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6.2             
Representations. Mortgagor hereby represents that, Mortgagor is entitled to receive
all the rents, issues and profits and to enjoy all the rents and benefits mentioned herein and assigned hereby, and the same have not
been sold, assigned, transferred or set over by any instrument now in force, and shall not at any time during the life of this Mortgage
be sold, assigned, transferred or set over by Mortgagor or any other person or persons taking under or through Mortgagor, except pursuant
to this Mortgage; and (c) Mortgagor has the sole right to sell, assign, transfer, and set over the same and to grant and confer upon Mortgagee
the rights, interests, powers and authorities herein granted and conferred.


 


6.3             
Further Assurances. Mortgagor shall from time to time execute any and all instruments
reasonably requested by Mortgagee in order to effectuate this Mortgage and to accomplish any of the purposes that are necessary or appropriate
in connection with this assignment of the leases of the Property, including without limitation, specific assignments of any Lease or agreement
relating to the use and occupancy of the Property or to any part thereof now or hereafter in effect, as may be necessary or desirable
in Mortgagee's opinion in order to further secure Mortgagee hereunder.


 


6.4             
Lease Modification. Mortgagor shall not (i) amend, extend or modify any Lease, (ii)
waive or release lessees from obligations under any Lease or Existing Lease, (m) terminate or accept from a tenant the termination of
any Lease or Existing Lease, (iv) consent to the Mortgage or subleasing of the lessee's interest under any lease or Existing Lease, or
(v) evict or institute proceedings to evict any tenant under a Lease or Existing Lease, without the prior written consent of Mortgagee,
which consent shall not be unreasonably withheld, conditioned or delayed. 


 


6.5             
Lack of Responsibility. Mortgagee shall not in any way be responsible for any failure
to do any or all of the things for which the rights, interests, power or authority are herein granted; and Mortgagee shall not be responsible
for, or liable under, any of the agreements undertaken or obligations imposed upon the Mortgagor as lessor under any of the Leases or
other agreements with respect to the Property. Mortgagee shall be accountable only for the amounts, if any, actually received by it under
the terms of this Mortgage.


 


6.6             
Effective Date. The parties agree that this Mortgage is an actual assignment effective
as of the date hereof, and that upon demand made by Mortgagee on the lessor or lessee under any of the Leases or on any person liable
for any of the rents, issues, and profits of and from the Property or any part thereof, such lessor or lessee or person liable for any
of such rents, issues and profits shall, and is hereby authorized and directed to pay to or upon Mortgagee's order, and without any inquiry
of any nature, all rents and other payments then or thereafter accruing under the Leases or any other instrument or agreement, oral or
written, granting rights to, and creating an obligation to pay rents, issues, or profits in connection with the Property.


 


6.7             
Collection and Application of Rents. As long as no Event of Default exists under the
Indebtedness secured hereby, Mortgagee agrees not to demand from any lessor or lessee under the Leases or from any other persons liable
therefor, any of the rents, issues or profits hereby assigned, but shall permit Mortgagor to collect all such rents, issues and profits
from the Property and the Leases on, but not prior to, accrual, and Mortgagor shall apply the same (i) first, to the payment of taxes
and assessments upon the Property before penalty or interest is due thereon, (ii) second, to the cost of such insurance and of such maintenance
and repairs as are required by the terms of the Note, and (iii) third, to the payment of principal, premium (if any) and interest becoming
due on the Note, before using any part of the same for any other purposes; provided, however, that notwithstanding the provisions of this
section, all lessors and lessees under the Leases and all persons liable for rents, issues and profits of and from the Property shall
comply with any demands for rents made by Mortgagee pursuant to the provisions of this Mortgage without reference to whether or not the
same is made in accordance with this section and without further consent from Mortgagor.


 






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6.8             
Leases & Defaults. Upon or at any time after the occurrence and during the continuance
of an Event of Default under the Indebtedness, Mortgagee may declare all sums secured hereby immediately due and payable and may, at Mortgagee's
option, without notice, either in Mortgagee's person or by agent and with or without bringing any action or proceeding, or by any receiver
to be appointed by a court, to the full extent permitted by applicable law, enter upon, take possession of, and manage and operate the
Property and each and every part thereof, and in connection therewith, Mortgagee may make, enforce, and modify any of the Leases; fix
or modify rents; repair, maintain, and improve the Property; employ contractors, subcontractors, and workmen in and about the Property;
obtain and evict tenants; in its own name, sue for or otherwise collect or reserve any and all rents, issues and profits, including those
past due and unpaid; employ leasing agents, managing agents, attorneys and accountants in connection with the enforcement of Mortgagee's
rights hereunder and pay the reasonable fees and expenses thereof; and otherwise do and perform any and all acts which Mortgagee may deem
necessary and appropriate in and about the Property for the protection thereof and of Mortgagee's rights hereunder or under the Note,
and any and all amounts expended by Mortgagee in connection with the foregoing shall constitute additional Indebtedness secured hereby.
Mortgagee shall apply any monies collected by Mortgagee, as aforesaid, less costs and expenses incurred, as aforesaid, upon any Indebtedness
secured hereby In such order and manner as Mortgagee may determine. The entering upon and taking possession of the Property; the collection
of rents, issues, and profits; the exercise of any rights hereinabove specified; and the application of collections, as aforesaid, shall
not cure, waive, modify or affect any default hereunder or under the Note.


 


6.9             
Tenants. All tenants or occupants of any part of the Property (including without limitation,
all persons claiming any interest as lessor or lessee under any Leases) are hereby authorized to recognize the claims and demands of Mortgagee
without investigation as to the reason for any action taken by Mortgagee or the validity or the amount of indebtedness owing to or the
existence of any default hereunder or under the Note, or the application to be made by Mortgagee, of any amounts to be paid to Mortgagee.
Mortgagee's sole signature shall be sufficient for the exercise of any right under this Mortgage and Mortgagee's sole receipt given for
any sums received shall be a full discharge and release therefor to any such tenant or occupant of the Property. Checks for all or any
part of the rental collected under this Mortgage shall be made to the exclusive order of Mortgagee.


 


6.10         
Performance of Obligations. Mortgagor shall perform all of its obligations as lessor
or lessee under any of the Leases, and shall give prompt notice to Mortgagee of any notice of default by Mortgagor under any of the Leases,
together with a complete copy of any such notice. Mortgagor shall enforce the performance and observance of each and every covenant of
the lessor's or lessees' under the Leases.


 


6.11         
Operation of Property. Mortgagee shall not be obligated to perform or discharge any
obligation, duty or liability under any of the Leases, nor shall this Mortgage operate to place upon Mortgagee responsibility for the
control, operation, management, or repair of the Property or the carrying out of any of the terms and conditions of any of the Leases;
nor shall this Mortgage operate to make Mortgagee liable for any waste committed on the Property by the lessor or lessee under any of
the Leases or committed by any other party, or for any dangerous or defective condition of the Property, or for any negligence in the
management, upkeep, repair or control of the Property, resulting in loss, injury or death to any tenant, licensee, employee, invitee or
stranger.


 






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6.12         
Indemnification with respect to Leases. Mortgagor shall, and does hereby agree to,
indemnify and hold Mortgagee harmless of and from any and all liability, loss or damage which it may or might incur under any of the Leases
or under or by reason of this Mortgage and of and from any and all claims and demands whatsoever which may be asserted against it by reason
of any alleged obligations or undertakings on its part to perform or discharge any of the terms, covenants, or agreements contained in
any of the Leases, except for liability, loss or damage and all claims and demands arising from actions taken by Mortgagee or its authorized
representatives hereunder. Should Mortgagee incur any such liability, loss or damage under any of the Leases or under or by reason of
this Mortgage, or in the defense of any such claims or demands, the amount thereof, including costs, expenses, and reasonable attorney's
fees, shall be secured hereby, Mortgagor shall reimburse Mortgagee therefor immediately upon demand, and upon Mortgagor's failure to do
so, Mortgagee may declare all such sums immediately due and payable.


 


6.13         
Advance Rent. Mortgagor has not and shall not accept rent in advance under any of the
Leases except only monthly rents for current months which may be paid in advance. 


 


ARTICLE
7 




 


DEFENSE


 


7.1             
Defense. If Mortgagor shall keep, observe and perform all of the covenants and conditions
of this Mortgage on its part to be kept and performed and shall pay and perform, or cause to be paid and performed, all of the Indebtedness
whether now outstanding or hereafter arising, including alt extensions and renewals thereof, and all of the other Indebtedness, then Mortgagee
shall release this Mortgage upon the request and at the expense of Mortgagor, otherwise this Mortgage shall remain in full force and effect.


 


[Signature on following page]


 






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IN WITNESS WHEREOF, the parties
hereto have executed this instrument as of the date first above written.


 


		MORTGAGOR:
	 	 	 
	 	PHR CHERRY PROPCO, LLC
	 	 	 
	 	By:	/s/ James A. Procaccianti
	 	 	Name: James A. Procaccianti
	 	 	Title: Authorized Signer



 


	STATE OF RHODE ISLAND	§	 
	 	§	 
	COUNTY OF PROVIDENCE	§	 



 


The foregoing instrument was acknowledged
before me this 28th day of July, 2021, by James A. Procaccianti, as authorized signer of PHR CHERRY PROPCO, LLC, a Michigan limited
liability company, on its behalf.


 


Date: July 28, 2021


 


	 	/s/ Ron M. Hadar
		Notary Public
	 	Print Name:	Ron M. Hadar



 


	My Commission Expires:	12/28/23	 



 


[Official Seal]


 


[Signature Page to Mortgage – Assignment of Leases and Rents and Fixture Filing]


 






     


     


    

 


EXHIBIT A


 


LEGAL DESCRIPTION


 


(HOTEL PROPERTY)


 


Land in the Township of East Bay, Grand Traverse County, MI, described
as follows:


 


Unit Nos. 1 through 77, Cherry Tree Condominium, according to the Master
Deed recorded in Liber 2006C, Page 00067, and Amendments thereto, First Amendment to Master Deed recorded in Instrument No. 2008C-00015
and designated as Grand Traverse County Condominium Subdivision Plan No. 317, together with rights in general common elements and limited
common elements as set forth in above Master Deeds and as described, in ACT 59 of Public Acts of 1978, and amendments thereto.


 


Excepting:


An undivided 1/4 interest in Unit 2 Cherry Tree Condominium being Fractional
ID "A" and "E",


An undivided 1/4 interest in Unit 2 Cherry Tree Condominium being Fractional
ID "C and "G"",


An undivided 1/4 interest in Unit 3 Cherry Tree Condominium being Fractional
ID "A" and "E",


An undivided 1/4 interest in Unit 3 Cherry Tree Condominium being Fractional
ID "D" and "H",


An undivided 1/4 interest in Unit 4 Cherry Tree Condominium being Fractional
ID "D" and "H",


An undivided 1/4 interest in Unit 9 Cherry Tree Condominium being Fractional
ID "D" and "H",


An undivided 1/4 interest in Unit 23 Cherry Tree Condominium being
Fractional ID "D" and "H",


An undivided 1/4 interest in Unit 24 Cherry Tree Condominium being
Fractional ID "D" and "H",


An undivided 1/4 interest in Unit 37 Cherry Tree Condominium being
Fractional ID "A" and "E",


An undivided 1/4 interest in Unit 45 Cherry Tree Condominium being
Fractional ID "A" and "E",


An undivided 1/4 interest in Unit 72 Cherry Tree Condominium being
Fractional ID "B" and "F".


 






    A-1