Exhibit 10.97


 


RECORD AND RETURN TO:


 


Cassin Cassin & Joseph LLP


711 Third Avenue, 20th Floor


New York, New York 10017


Attn:  Carol M. Joseph, Esq.


 


 




MORTGAGE,
ASSIGNMENT OF RENTS, SECURITY AGREEMENT AND FIXTURE FILING


 


 





 


 


INLAND AMERICAN SWAMPSCOTT, L.L.C., a

Delaware limited liability company, as mortgagor (Borrower)


 


for
the benefit of


 


NOMURA CREDIT & CAPITAL, INC.
,

as
mortgagee, and its successors and assigns (Lender)


 






 


THE COLLATERAL IS OR
INCLUDES FIXTURES


 


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


 


	
   

  	
  Borrower’s
  Organizational Number: 4150581

  
	
   

  	
  Borrower’s Federal
  Identification No.: 20-4780030

  
	
   

  	
   

  	
   

  
	
   

  	
  Date:

  	
  As
  of June 8, 2006

  
	
   

  	
  Location:

  	
  Swampscott
  Stop & Shop

  
	
   

  	
   

  	
  450
  Paradise Road

  
	
   

  	
   

  	
  Swampscott,
  Massachusetts

  
	
   

  	
   

  	
   

  
	
   

  	
  County:

  	
  Essex

  





 


 





 

















 


MORTGAGE,
ASSIGNMENT OF RENTS,


SECURITY
AGREEMENT AND FIXTURE FILING


 


THIS MORTGAGE, ASSIGNMENT OF RENTS, SECURITY AGREEMENT AND FIXTURE FILING
(this “Mortgage”) is made as of this 8th
day of June, 2006, by INLAND AMERICAN
SWAMPSCOTT, L.L.C., a Delaware limited liability company, having its
principal place of business at 2901 Butterfield Road, Oak Brook, Illinois
60523, as mortgagor (“Borrower”),
for the benefit of NOMURA CREDIT &
CAPITAL, INC., a Delaware corporation, its successors and assigns,
having an address at 2 World Financial Center, Bldg. B., New York, New York
10281, as mortgagee (“Lender”).


 


W I
T  N  E  S  S  E  T  H:


 


WHEREAS, this Mortgage is given to secure a loan (the “Loan”)
in the principal sum of ELEVEN MILLION SIXTY-SIX
THOUSAND FOUR HUNDRED SEVENTY-SEVEN AND 00/100 DOLLARS ($11,066,477.00)
advanced pursuant to that certain Loan Agreement dated as of the
date hereof between Borrower and Lender (as the same may be amended, restated,
replaced, supplemented or otherwise modified from time to time, the “Loan Agreement”, and evidenced by
that certain Promissory Note dated the date hereof made by Borrower to Lender
(such Note, together with all extensions, renewals, replacements, restatements
or modifications thereof being hereinafter referred to as the “Note”), which Note provides, among other
things, for final payment of principal and interest thereunder, if not sooner paid or payable as
provided therein, to be due on June 11, 2031;


 


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


 


WHEREAS, this Mortgage is that certain “Deed of Trust”
or “Mortgage” as defined in the Loan Agreement, and payment, fulfillment, and
performance by Borrower of its obligations thereunder and under the other Loan
Documents are, subject to the limitations
set forth herein, secured hereby, and each and every term and provision of the
Loan Agreement and the Note, including the rights, remedies, obligations,
covenants, conditions, agreements, indemnities, representations and warranties
of the parties therein, are hereby incorporated by reference herein as though
set forth in full and shall be considered a part of this Mortgage (the Loan
Agreement, the Note, this Mortgage, that certain Assignment of Leases and Rents
of even date herewith made by Borrower in favor of Lender (the “Assignment of Leases”) and all
other documents evidencing or securing the Debt are hereinafter referred to
collectively as the “Loan Documents”).


 


NOW THEREFORE, in consideration of the making of the
Loan by Lender and the covenants, agreements, representations and warranties
set forth in this Mortgage:


 

















 


ARTICLE 1



GRANTS OF SECURITY


 


Section 1.1.            Property Mortgaged. Borrower does hereby irrevocably mortgage,
grant, bargain, pledge, assign, warrant, transfer and convey to Lender and its
successors and assigns, WITH POWER OF SALE and grant a security interest to
Lender its successor and assigns, in the following property, rights, interests
and estates now owned, or hereafter acquired by Borrower (collectively, the “Property”):


 


(a)           Land.
The real property described in Exhibit A
attached hereto and made a part hereof (the “Land”);


 


(b)           Additional Land. All additional lands, estates and development rights hereafter acquired
by Borrower for use in connection with the Land and the development of the Land
and all additional lands and estates therein which may, from time to time, by
supplemental mortgage or otherwise be expressly made subject to the lien of
this Mortgage;


 


(c)           Improvements. The buildings, structures, fixtures, additions, enlargements,
extensions, modifications, repairs, replacements and improvements now or
hereafter erected or located on the Land (collectively, the “Improvements”);


 


(d)           Easements. All easements, rights-of-way or use, rights, strips and gores of land,
streets, ways, alleys, passages, sewer rights, water, water courses, water
rights and powers, air rights and development rights, and all estates, rights,
titles, interests, privileges, liberties, servitudes, tenements, hereditaments
and appurtenances of any nature whatsoever, in any way now or hereafter
belonging, relating or pertaining to the Land and the Improvements and the
reversion and reversions, remainder and remainders, and all land lying in the
bed of any street, road or avenue, opened or proposed, in front of or adjoining
the Land, to the center line thereof and all the estates, rights, titles,
interests, dower and rights of dower, curtesy and rights of curtesy, property,
possession, claim and demand whatsoever, both at law and in equity, of Borrower
of, in and to the Land and the Improvements and every part and parcel thereof,
with the appurtenances thereto;


 


(e)           Equipment. All “equipment,” as such term is defined in Article 9 of the Uniform
Commercial Code, now owned or hereafter acquired by Borrower, which is used at
or in connection with the Improvements or the Land or is located thereon or
therein (including, but not limited to, all machinery, equipment, furnishings,
and electronic data-processing and other office equipment now owned or
hereafter acquired by Borrower and any and all additions, substitutions and
replacements of any of the foregoing), together with all attachments,
components, parts, equipment and accessories installed thereon or affixed
thereto (collectively, the “Equipment”).
Notwithstanding the foregoing, Equipment shall not include any property
belonging to tenants under leases except to the extent that Borrower shall have
any right or interest therein;


 


2

















 


(f)            Fixtures. All Equipment now owned, or the ownership of which is hereafter
acquired, by Borrower which is so related to the Land and Improvements forming
part of the Property that it is deemed fixtures or real property under the law
of the particular state in which the Equipment is located, including, without
limitation, all building or construction materials intended for construction,
reconstruction, alteration or repair of or installation on the Property,
construction equipment, appliances, machinery, plant equipment, fittings,
apparatuses, fixtures and other items now or hereafter attached to, installed
in or used in connection with (temporarily or permanently) any of the
Improvements or the Land, including, but not limited to, engines, devices for
the operation of pumps, pipes, plumbing, cleaning, call and sprinkler systems,
fire extinguishing apparatuses and equipment, heating, ventilating, plumbing,
laundry, incinerating, electrical, air conditioning and air cooling equipment
and systems, gas and electric machinery, appurtenances and equipment, pollution
control equipment, security systems, disposals, dishwashers, refrigerators and
ranges, recreational equipment and facilities of all kinds, and water, gas,
electrical, storm and sanitary sewer facilities, utility lines and equipment
(whether owned individually or jointly with others, and, if owned jointly, to
the extent of Borrower’s interest therein) and all other utilities whether or
not situated in easements, all water tanks, water supply, water power sites,
fuel stations, fuel tanks, fuel supply, and all other structures, together with
all accessions, appurtenances, additions, replacements, betterments and
substitutions for any of the foregoing and the proceeds thereof (collectively,
the “Fixtures”). Notwithstanding the
foregoing, “Fixtures” shall not include any property which tenants are entitled
to remove pursuant to leases except to the extent that Borrower shall have any
right or interest therein;


 


(g)           Personal Property. All furniture, furnishings, objects of art,
machinery, goods, tools, supplies, appliances, general intangibles, contract
rights, accounts, accounts receivable, franchises, licenses, certificates and
permits, and all other personal property of any kind or character whatsoever
(as defined in and subject to the provisions of the Uniform Commercial Code as
hereinafter defined), other than Fixtures, which are now or hereafter owned by
Borrower and which are located within or about the Land and the Improvements,
together with all accessories, replacements and substitutions thereto or
therefor and the proceeds thereof (collectively, the “Personal
Property”), and the right, title and interest of Borrower in and
to any of the Personal Property which may be subject to any security interests,
as defined in the Uniform Commercial Code, as adopted and enacted by the state
or states where any of the Property is located (the “Uniform
Commercial Code”), superior in lien to the lien of this Mortgage
and all proceeds and products of the above;


 


(h)           Leases and Rents. All leases, subleases or sub-subleases, lettings, licenses, concessions
or other agreements (whether written or oral) pursuant to which any Person is
granted a possessory interest in, or right to use or occupy all or any portion
of the Land and the Improvements, and every modification, amendment or other
agreement relating to such leases, subleases, sub-subleases, or other
agreements entered into in connection with such leases, subleases,
sub-subleases, or other agreements and every guarantee, of the performance and
observance of the covenants, conditions and agreements to be performed and
observed by the other party thereto, heretofore or hereafter entered into,
whether before or after the filing by or 


 


3

















 


against
Borrower of any petition for relief under 11 U.S.C. §101 et seq., as the same
may be amended from time to time (the “Bankruptcy Code”)
(collectively, the “Leases”)
and all right, title and interest of Borrower, its successors and assigns
therein and thereunder, including, without limitation, cash or securities
deposited thereunder to secure the performance by the lessees of their
obligations thereunder and all rents, additional rents, revenues, issues and
profits (including all oil and gas or other mineral royalties and bonuses) from
the Land and the Improvements whether paid or accruing before or after the filing
by or against Borrower of any petition for relief under the Bankruptcy Code
(collectively, the “Rents”) and
all proceeds from the sale or other disposition of the Leases and the right to
receive and apply the Rents to the payment of the Debt;


 


(i)            Condemnation Awards. All awards or payments, including interest
thereon, which may heretofore and hereafter be made with respect to the
Property, whether from the exercise of the right of eminent domain (including
but not limited to any transfer made in lieu of or in anticipation of the
exercise of the right), or for a change of grade, or for any other injury to or
decrease in the value of the Property subject to the terms, provisions and
conditions of the Loan Agreement;


 


(j)            Insurance Proceeds. All proceeds in respect of the Property under
any insurance policies covering the Property, including, without limitation,
the right to receive and apply the proceeds of any insurance, judgments, or
settlements made in lieu thereof, for damage to the Property subject to the
terms, provisions and conditions of the Loan Agreement;


 


(k)           Tax Certiorari. All refunds, rebates or credits in connection with reduction in real
estate taxes and assessments charged against the Property as a result of tax
certiorari or any applications or proceedings for reduction;


 


(l)            Conversion. All proceeds of the conversion, voluntary or involuntary, of any of the
foregoing including, without limitation, proceeds of insurance and condemnation
awards, into cash or liquidation claims;


 


(m)          Rights. Subject to the terms, provisions and conditions of the Loan Agreement,
the right, in the name and on behalf of Borrower, to appear in and defend any
action or proceeding brought with respect to the Property and to commence any
action or proceeding to protect the interest of Lender in the Property;


 


(n)           Agreements. All agreements, contracts, certificates, instruments, franchises,
permits, licenses, plans, specifications and other documents, now or hereafter
entered into, and all rights therein and thereto, respecting or pertaining to
the use, occupation, construction, management or operation of the Land and any
part thereof and any Improvements or respecting any business or activity
conducted on the Land and any part thereof and all right, title and interest of
Borrower therein and thereunder, including, without limitation, the right, upon
the happening of any default hereunder, to receive and collect any sums payable
to Borrower thereunder, in each case, to the extent assignable;


 


4

















 


(o)           Trademarks. All tradenames, trademarks, servicemarks, logos, copyrights, goodwill,
books and records and all other general intangibles relating to or used in
connection with the operation of the Property (excluding, however, the name “Inland”
and any mark registered to The Inland Group, Inc., or any of its affiliates),
in each case, to the extent assignable;


 


(p)           Accounts. All reserves, escrows, and deposit accounts maintained by Borrower with
respect to the Property, including without limitation, all securities,
investments, property and financial assets held therein from time to time and
all proceeds, products, distributions or dividends or substitutions thereon and
thereof;


 


(q)           Letter of Credit. All letter-of-credit rights (whether or not the letter of credit is
evidenced by a writing) Borrower now has or hereafter acquires relating to the
properties, rights, titles and interests referred to in this Section 1.1;


 


(r)            Tort Claims. All commercial tort claims Borrower now has or hereafter acquires
relating to the properties, rights, titles and interests referred to in this
Section 1.1; and


 


(s)           Other Rights. Any and all other rights of Borrower in and to the items set forth in
Subsections (a) through (r) above.


 


AND without limiting any of the other provisions of
this Mortgage, to the extent permitted by applicable law, Borrower expressly
grants to Lender, as secured party, a security interest in the portion of the
Property which is or may be subject to the provisions of the Uniform Commercial
Code which are applicable to secured transactions; it being understood and
agreed that the Improvements and Fixtures are part and parcel of the Land (the
Land, the Improvements and the Fixtures collectively referred to as the “Real Property”) appropriated to the
use thereof and, whether affixed or annexed to the Real Property or not, shall
for the purposes of this Mortgage be deemed conclusively to be real estate and
mortgaged hereby.


 


Section 1.2.            Assignment of Rents. Borrower hereby absolutely and unconditionally
assigns to Lender all of Borrower’s right, title and interest in and to all
current and future Leases and Rents; it being intended by Borrower that this
assignment constitutes a present, absolute assignment and not an assignment for
additional security only. Nevertheless, subject to the terms of the Assignment
of Leases and Section 7.1(h) of this Mortgage, Lender grants to Borrower a
revocable license to collect, receive, use and enjoy the Rents. Borrower shall
hold the Rents, or a portion thereof sufficient to discharge all current sums
due on the Debt, for use in the payment of such sums.


 


Section 1.3.            Security Agreement. This Mortgage is both a real property deed of
trust and a “security agreement” within the meaning of the Uniform Commercial
Code. The Property includes both real and personal property and all other
rights and interests, whether tangible or intangible in nature, of Borrower in
the Property. By executing and delivering this Mortgage, Borrower hereby grants
to Lender, as security for the Obligations (hereinafter defined), a security
interest in the Fixtures, the Equipment and the Personal Property and other 


 


5

















 


property constituting the Property, whether
now owned or hereafter acquired, to the full extent that the Fixtures, the
Equipment and the Personal Property may be subject to the Uniform Commercial
Code (said portion of the Property so subject to the Uniform Commercial Code
being called the “Collateral”).
THE COLLATERAL IS OR INCLUDES
FIXTURES. If an Event of Default shall occur and be continuing,
Lender, in addition to any other rights and remedies which it may have, shall
have and may exercise immediately and without demand, any and all rights and
remedies granted to a secured party upon default under the Uniform Commercial
Code, including, without limiting the generality of the foregoing, the right to
take possession of the Collateral or any part thereof, and to take such other
measures as Lender may deem necessary for the care, protection and preservation
of the Collateral. Upon request or demand of Lender after the occurrence and
during the continuance of an Event of Default, Borrower shall, at its expense,
assemble the Collateral and make it available to Lender at a convenient place
(at the Land if tangible property) reasonably acceptable to Lender. Borrower
shall pay to Lender on demand any and all expenses, including reasonable legal
expenses and attorneys’ fees, incurred or paid by Lender in protecting its
interest in the Collateral and in enforcing its rights hereunder with respect
to the Collateral after the occurrence and during the continuance of an Event
of Default. Any notice of sale, disposition or other intended action by Lender
with respect to the Collateral sent to Borrower in accordance with the
provisions hereof at least ten (10) business days prior to such action, shall,
except as otherwise provided by applicable law, constitute commercially
reasonable notice to Borrower. The proceeds of any disposition of the
Collateral, or any part thereof, may, except as otherwise required by
applicable law, be applied by Lender to the payment of the Debt in such
priority and proportions as Lender in its discretion shall deem proper. Borrower’s
(Debtor’s) principal place of business is as set forth on page one hereof and
the address of Lender (Secured Party) is as set forth on page one hereof.


 


Section 1.4.            Fixture Filing. Certain of the Property is or will become “fixtures” (as that term is
defined in the Uniform Commercial Code) on the Land, described or referred to
in this Mortgage, and this Mortgage, upon being filed for record in the real
estate records of the city or county wherein such fixtures are situated, shall
operate also as a financing statement filed as a fixture filing in accordance
with the applicable provisions of said Uniform Commercial Code upon such of the
Property that is or may become fixtures.


 


The Borrower hereby authorizes the Lender at any time
and from time to time to file any initial financing statements, amendments
thereto and continuation statements with or without the signature of the
Borrower as authorized by applicable law, as applicable to all or part of the
fixtures or Personal Property. For purposes of such filings, the Borrower
agrees to furnish any information requested by the Lender promptly upon request
by the Lender. The Borrower also ratifies its authorization for the Lender to
have filed any like initial financing statements, amendments thereto and
continuation statements, if filed prior to the date of this Mortgage. The
Borrower hereby irrevocably constitutes and appoints the Lender and any officer
or agent of the Lender, with full power of substitution, as its true and lawful
attorneys- in-fact with full irrevocable power and authority in the place and
stead of the Borrower or in the Borrower’s own name to execute in the Borrower’s
name any documents and otherwise to carry out the purposes 


 


6

















 


of this Section 1.4, to the extent that the Borrower’s
authorization above is not sufficient. To the extent permitted by law, the
Borrower hereby ratifies all acts said attorneys-in-fact have lawfully done in
the past or shall lawfully do or cause to be done in the future by virtue
hereof. This power of attorney is coupled with an interest and shall be
irrevocable.


 


Section 1.5.            Pledges of Monies Held. Borrower hereby pledges to Lender any and all
monies now or hereafter held by Lender or on behalf of Lender, including,
without limitation, any sums deposited in the Lockbox Account (if any), the
Reserve Funds and Net Proceeds, as additional security for the Obligations
until expended or applied as provided in this Mortgage or in the Loan
Agreement.


 


CONDITIONS TO GRANT


 


TO HAVE AND TO HOLD the above granted and described
Property unto Lender, and its successors and assigns, forever;


 


IN TRUST, WITH THE POWER OF SALE, to secure payment to
Lender of the Debt at the time and in the manner provided for in the Note, the
Loan Agreement, and this Mortgage;


 


PROVIDED, HOWEVER, these presents are upon the express
condition that, if Borrower shall well and truly pay to Lender the Debt at the
time and in the manner provided in the Note, the Loan Agreement and this
Mortgage, shall well and truly perform the Other Obligations as set forth in
this Mortgage and shall well and truly abide by and comply with each and every
covenant and condition set forth herein and in the Note, the Loan Agreement and
the other Loan Documents, these presents and the estate hereby granted shall
cease, terminate and be void and Lender shall promptly thereafter mark the Note
“paid in full” and will, at Borrower’s sole cost and expense, release the lien
of this Mortgage (and Lender agrees to make reasonable efforts to do so within
thirty days following the satisfaction of the conditions herein set forth and
Borrower’s written request thereafter to provide such release); provided,
however, that Borrower’s obligation to indemnify and hold harmless Lender
pursuant to the provisions hereof shall survive any such payment or release.


 


ARTICLE 2



DEBT AND OBLIGATIONS SECURED


 


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


 


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


 


7

















 


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


 


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


 


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


 


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


 


Section 2.2.            Other Obligations. This Mortgage and the grants, assignments and
transfers made in Article 1 are also given for the purpose of securing the
following (the “Other Obligations”):


 


(a)           the performance of all other obligations of
Borrower contained herein;


 


(b)           the performance of each obligation of Borrower
contained in the Loan Agreement and any other Loan Document; and


 


(c)           the performance of each obligation of Borrower
contained in any renewal, extension, amendment, modification, consolidation,
change of, or substitution or replacement for, all or any part of the Note, the
Loan Agreement or any other Loan Document.


 


Section 2.3.            Debt and Other Obligations. Borrower’s obligations for the payment of the
Debt and the performance of the Other Obligations shall be referred to
collectively herein as the “Obligations.”


 


ARTICLE 3



BORROWER COVENANTS


 


Borrower covenants and agrees that:


 


Section 3.1.            Payment of Debt. Borrower will pay the Debt at the time and in the manner provided in the
Loan Agreement, the Note and this Mortgage.


 


Section 3.2.            Incorporation by Reference. All the covenants, conditions and agreements
contained in (a) the Loan Agreement , (b) the Note and (c) all and any of the
other Loan Documents, are hereby made a part of this Mortgage to the same
extent and with the same force as if fully set forth herein.


 


8

















 


Section 3.3.            Insurance. Borrower shall obtain and maintain, or cause to be maintained, in full
force and effect at all times insurance with respect to Borrower and the
Property as required pursuant to the Loan Agreement.


 


Section 3.4.            Maintenance of Property. Borrower shall cause the Property to be
maintained in a good and safe condition and repair. The Improvements, the
Fixtures, the Equipment and the Personal Property shall not be removed,
demolished or materially altered except as provided for in the Loan Agreement
(except for normal replacement of the Fixtures, the Equipment or the Personal
Property, tenant finish and refurbishment of the Improvements) without the
consent of Lender as provided for in the Loan Agreement. Borrower shall
promptly repair, replace or rebuild any part of the Property which may be
destroyed by any casualty, or become damaged, worn or dilapidated and shall
complete and pay for any structure at any time in the process of construction
or repair on the Land except as set forth in the Loan Agreement.


 


Section 3.5.            Waste. Borrower shall not commit or suffer any waste of the Property or make
any change in the use of the Property which will in any way materially increase
the risk of fire or other hazard arising out of the operation of the Property,
or take any action that might invalidate or allow the cancellation of any
Policy, or do or permit to be done thereon anything that may in any way
materially impair the value of the Property or the security of this Mortgage. Borrower
will not, without the prior written consent of Lender, permit any drilling or
exploration for or extraction, removal, or production of any minerals from the
surface or the subsurface of the Land, regardless of the depth thereof or the
method of mining or extraction thereof.


 


Section 3.6.            Payment for Labor and Materials.


 


(a)           Subject to the terms, provisions and conditions of
the Loan Agreement, Borrower will promptly pay or cause to be paid when due all
bills and costs for labor, materials, and specifically fabricated materials (“Labor and Material Costs”) incurred
in connection with the Property and never permit to exist beyond the due date
thereof in respect of the Property or any part thereof any lien or security
interest, even though inferior to the liens and the security interests hereof,
and in any event never permit to be created or exist in respect of the Property
or any part thereof any other or additional lien or security interest other
than the liens or security interests hereof except for the Permitted
Encumbrances.


 


(b)           Subject to the terms, provisions and conditions of
the Loan Agreement, after prior written notice to Lender, Borrower, or any
tenant of the Property pursuant to the terms of such tenant’s lease, at its own
expense, may contest by appropriate legal proceeding, promptly initiated and
conducted in good faith and with due diligence, the amount or validity or
application in whole or in part of any of the Labor and Material Costs,
provided that (i) no Event of Default has occurred and is continuing under the
Loan Agreement, the Note, this Mortgage or any of the other Loan Documents,
(ii) Borrower is permitted to do so under the provisions of any other mortgage,
deed of trust or deed to secure debt affecting the Property, (iii) such
proceeding shall suspend the collection of the Labor and Material Costs from
Borrower and from the Property or Borrower shall have paid all of the Labor and
Material Costs under protest, (iv) such 


 


9

















 


proceeding
shall be permitted under and be conducted in accordance with the provisions of
any other instrument to which Borrower is subject and shall not constitute a
default thereunder, (v) neither the Property nor any part thereof or interest
therein will be in danger of being sold, forfeited, terminated, canceled or
lost, and (vi) Borrower shall have furnished the security as may be required in
the proceeding, or as may be reasonably requested by Lender to insure the
payment of any contested Labor and Material Costs, together with all interest
and penalties thereon.


 


Section 3.7.            Performance of Other Agreements. Borrower shall observe and perform each and
every term, covenant and provision to be observed or performed by Borrower
pursuant to the Loan Agreement, any other Loan Document and any other agreement
or recorded instrument affecting or pertaining to the Property and any amendments,
modifications or changes thereto.


 


Section 3.8.            Change of Name, Identity or Structure. Except as set forth in the Loan Agreement,
Borrower shall not change Borrower’s name, identity (including its trade name
or names) or, if not an individual, Borrower’s corporate, partnership or other
structure without notifying Lender of such change in writing at least thirty
(30) days prior to the effective date of such change and, in the case of a
change in Borrower’s structure, without first obtaining the prior written
consent of Lender which consent will not be unreasonably withheld, delayed or
conditioned provided that such action is otherwise in compliance with the Loan
Agreement. Borrower shall execute and deliver to Lender, prior to or
contemporaneously with the effective date of any such change, any financing
statement or financing statement change reasonably required by Lender to
establish or maintain the validity, perfection and priority of the security
interest granted herein. At the request of Lender, Borrower shall execute a
certificate in form reasonably satisfactory to Lender listing the trade names
under which Borrower intends to operate the Property, and representing and
warranting that Borrower does business under no other trade name with respect
to the Property.


 


Section 3.9.            Title. Borrower has good and indefeasible fee simple title to the real property
comprising part of the Property and good title to the balance of such Property,
free and clear of all Liens (as defined in the Loan Agreement) whatsoever
except the Permitted Encumbrances (as defined in the Loan Agreement), such
other Liens as are permitted pursuant to the Loan Documents and the Liens
created by the Loan Documents. To Borrower’s actual knowledge, the Permitted
Encumbrances in the aggregate do not materially adversely affect the value,
operation or use of the Property of Borrower’s ability to repay the Loan. This
Mortgage, when properly recorded in the appropriate records, together with any
Uniform Commercial Code financing statements required to be filed in connection
therewith, will create (a) a valid, perfected first priority lien, security
title and security interest on the Property, to the extent such security
interests can be perfected by filing; subject only to any applicable Permitted
Encumbrances, such other Liens as are permitted pursuant to the Loan Documents
and the Liens created by the Loan Documents. There are no claims for payment
for work, labor or materials affecting the Property which are past due and are
or may become a lien prior to, or of equal 


 


10

















 


priority with, the Liens created by the Loan
Documents unless such claims for payments are being contested in accordance
with the terms and conditions of this Mortgage.


 


Section 3.10.          Letter of Credit Rights. If Borrower is at any time a beneficiary under a
letter of credit relating to the properties, rights, titles and interests
referenced in Section 1.1 of this Mortgage now or hereafter issued in favor of
Borrower, Borrower shall promptly notify Lender thereof and, at the request and
option of Lender, Borrower shall, pursuant to an agreement in form and
substance satisfactory to Lender, either (i) arrange for the issuer and any
confirmer of such letter of credit to consent to an assignment to Lender of the
proceeds of any drawing under the letter of credit or (ii) arrange for the
Lender to become the transferee beneficiary of the letter of credit, with
Lender agreeing, in each case that the proceeds of any drawing under the letter
of credit are to be applied as provided in Section 7.2 of this Mortgage.


 


ARTICLE 4



OBLIGATIONS AND RELIANCES


 


Section 4.1.            Relationship of Borrower and Lender. The relationship between Borrower and Lender is
solely that of debtor and creditor, and Lender has no fiduciary or other
special relationship with Borrower, and no term or condition of any of the Loan
Agreement, the Note, this Mortgage and the other Loan Documents shall be
construed so as to deem the relationship between Borrower and Lender to be
other than that of debtor and creditor.


 


Section 4.2.            No Reliance on Lender. The general partners, members, principals and
(if Borrower is a trust) beneficial owners of Borrower are experienced in the
ownership and operation of properties similar to the Property, and Borrower and
Lender are relying solely upon such expertise and business plan in connection
with the ownership and operation of the Property. Borrower is not relying on
Lender’s expertise, business acumen or advice in connection with the Property.


 


Section 4.3.            No Lender Obligations.


 


(a)           Notwithstanding the provisions of Subsections
1.1(h) and (n) or Section 1.2, Lender is not undertaking the performance of (i)
any obligations under the Leases; or (ii) any obligations with respect to such
agreements, contracts, certificates, instruments, franchises, permits,
trademarks, licenses and other documents.


 


(b)           By accepting or approving anything required to be
observed, performed or fulfilled or to be given to Lender pursuant to this
Mortgage, the Loan Agreement, the Note or the other Loan Documents, including,
without limitation, any officer’s certificate, balance sheet, statement of
profit and loss or other financial statement, survey, appraisal, or insurance
policy, Lender shall not be deemed to have warranted, consented to, or affirmed
the sufficiency, the legality or effectiveness of same, and such acceptance or
approval thereof shall not constitute any warranty or affirmation with respect
thereto by Lender.


 


11

















 


Section 4.4.            Reliance. Borrower recognizes and acknowledges that in accepting the Loan
Agreement, the Note, this Mortgage and the other Loan Documents, Lender is
expressly and primarily relying on the truth and accuracy of the warranties and
representations set forth in Section 4.1 of the Loan Agreement without any
obligation to investigate the Property and notwithstanding any investigation of
the Property by Lender; that such reliance existed on the part of Lender prior
to the date hereof, that the warranties and representations are a material
inducement to Lender in making the Loan; and that Lender would not be willing
to make the Loan and accept this Mortgage in the absence of the warranties and
representations as set forth in Section 4.1 of the Loan Agreement.


 


ARTICLE 5



FURTHER ASSURANCES


 


Section 5.1.            Recording of Mortgage, Etc. Borrower forthwith upon the execution and
delivery of this Mortgage and thereafter, from time to time, will cause this
Mortgage and any of the other Loan Documents creating a lien or security
interest or evidencing the lien hereof upon the Property and each instrument of
further assurance to be filed, registered or recorded in such manner and in
such places as may be required by any present or future law in order to publish
notice of and fully to protect and perfect the lien or security interest hereof
upon, and the interest of Lender in, the Property. Borrower will pay all taxes,
filing, registration or recording fees, and all expenses incident to the
preparation, execution, acknowledgment and/or recording of the Note, this
Mortgage, the other Loan Documents, any note, deed of trust or mortgage
supplemental hereto, any security instrument with respect to the Property and
any instrument of further assurance, and any modification or amendment of the
foregoing documents, and all federal, state, county and municipal taxes,
duties, imposts, assessments and charges arising out of or in connection with
the execution and delivery of this Mortgage, any deed of trust or mortgage
supplemental hereto, any security instrument with respect to the Property or
any instrument of further assurance, and any modification or amendment of the
foregoing documents, except where prohibited by law so to do.


 


Section 5.2.            Further Acts, Etc. Borrower will, at the cost of Borrower, and
without expense to Lender, do, execute, acknowledge and deliver all and every
such further acts, deeds, conveyances, deeds of trust, mortgages, assignments,
notices of assignments, transfers and assurances as Lender shall, from time to
time, reasonably require, for the better assuring, conveying, assigning,
transferring, and confirming unto Lender the property and rights hereby
mortgaged, deeded, granted, bargained, sold, conveyed, confirmed, pledged,
assigned, warranted and transferred or intended now or hereafter so to be, or
which Borrower may be or may hereafter become bound to convey or assign to
Lender, or for carrying out the intention or facilitating the performance of
the terms of this Mortgage or for filing, registering or recording this
Mortgage, or for complying with all Legal Requirements. Borrower, on demand,
will execute and deliver, and in the event it shall fail to so execute and
deliver, hereby authorizes Lender to execute in the name of Borrower or without
the signature of Borrower to the extent Lender may lawfully do so, one or more
financing statements to evidence more effectively the 


 


12

















 


security interest of Lender in the Property. Borrower
grants to Lender an irrevocable power of attorney coupled with an interest for
the purpose of exercising and perfecting any and all rights and remedies
available to Lender at law and in equity following an Event of Default,
including without limitation such rights and remedies available to Lender
pursuant to this Section 5.2. Nothing contained in this Section 5.2 shall be
deemed to create an obligation on the part of Borrower to pay any costs and
expenses incurred by Lender in connection with the Securitization or other sale
or transfer of the Loan.


 


Section 5.3.            Changes in Tax, Debt, Credit and Documentary Stamp
Laws.


 


(a)           If any law is enacted or adopted or amended after
the date of this Mortgage which deducts the Debt from the value of the Property
for the purpose of taxation or which imposes a tax, either directly or
indirectly, on the Debt or Lender’s interest in the Property, Borrower will pay
the tax, with interest and penalties thereon, if any. If Lender is advised by
counsel chosen by it that the payment of tax by Borrower would be unlawful or
taxable to Lender or unenforceable or provide the basis for a defense of usury
then Lender shall have the option by written notice of not less than one
hundred eighty (180) days to declare the Debt immediately due and payable.


 


(b)           Borrower will not claim or demand or be entitled
to any credit or credits on account of the Debt for any part of the Taxes or
Other Charges assessed against the Property, or any part thereof, and no
deduction shall otherwise be made or claimed from the assessed value of the
Property, or any part thereof, for real estate tax purposes by reason of this
Mortgage or the Debt. If such claim, credit or deduction shall be required by
law, Lender shall have the option, by written notice of not less than one
hundred eighty (180) days, to declare the Debt immediately due and payable.


 


(c)           If at any time the United States of America, any
State thereof or any subdivision of any such State shall require revenue or
other stamps to be affixed to the Note, this Mortgage, or any of the other Loan
Documents or impose any other tax or charge on the same, Borrower will pay for
the same, with interest and penalties thereon, if any.


 


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


 


Section 5.5.            Replacement Documents. Upon receipt of an affidavit of an officer of
Lender as to the loss, theft, destruction or mutilation of the Note or any
other Loan Document which is not of public record, and, in the case of any such
mutilation, upon surrender and cancellation of such Note or other Loan
Document, Borrower will issue, in lieu thereof, a replacement Note or other
Loan Document, dated the date of such lost, stolen, destroyed or mutilated Note
or other Loan Document in the same principal amount thereof and otherwise of
like tenor.


 


13

















 


ARTICLE 6



DUE ON SALE/ENCUMBRANCE


 


Section 6.1.            Lender Reliance. Borrower acknowledges that Lender has examined and relied on the
experience of Borrower and its general partners, members, principals and (if
Borrower is a trust) beneficial owners in owning and operating properties such
as the Property in agreeing to make the Loan, and will continue to rely on Borrower’s
ownership of the Property as a means of maintaining the value of the Property
as security for repayment of the Debt and the performance of the Other
Obligations. Borrower acknowledges that Lender has a valid interest in
maintaining the value of the Property so as to ensure that, should Borrower
default in the repayment of the Debt or the performance of the Other
Obligations, Lender can recover the Debt by a sale of the Property conducted in
accordance with the terms of the Loan Documents and applicable law.


 


Section 6.2.            No Sale/Encumbrance. Except as set forth in Section 5.2.13 of the
Loan Agreement, Borrower agrees that Borrower shall not, without the prior
written consent of Lender, sell, convey, mortgage, grant, bargain, encumber,
pledge, assign, or otherwise transfer the Property or any part thereof,
including, but not limited to, a grant of an easement, restriction, covenant,
reservation or right of way (except as expressly permitted in Section 5.2.13 of
the Loan Agreement), or permit the Property or any part thereof to be sold,
conveyed, mortgaged, granted, bargained, encumbered, pledged, assigned, or
otherwise transferred, unless Lender shall consent thereto in accordance with
Section 6.4 hereof.


 


Section 6.3.            Sale/Encumbrance Defined. Except as permitted pursuant to the terms of
Section 5.2.13 of the Loan Agreement, a sale, conveyance, mortgage, grant,
bargain, encumbrance, pledge, assignment, or transfer within the meaning of
this Article 6 shall be deemed to include, but not be limited to, (a) an
installment sales agreement wherein Borrower agrees to sell the Property or any
part thereof for a price to be paid in installments; (b) an agreement by
Borrower leasing all or a substantial part of the Property for other than
actual occupancy by a space tenant thereunder or a sale, assignment or other
transfer of, or the grant of a security interest in, Borrower’s right, title
and interest in and to any Leases or any Rents; (c) the voluntary or
involuntary sale, conveyance, transfer or pledge of the stock of the sole
member of Borrower (or the stock of
any corporation directly or indirectly controlling such sole member by
operation of law or otherwise) or the creation or issuance of new stock by
which an aggregate of more than ten percent (10%) of such sole member’s stock
shall be vested in a party or parties who are not now stockholders; (d) the
voluntary or involuntary sale, conveyance, transfer or pledge of any membership
interest in Borrower; (e) if Borrower, any sole member of Borrower, any guarantor
or any indemnitor is a limited liability company, the change, removal or
resignation of a member or managing member or the transfer or pledge of the
interest of any member or managing member or any profits or proceeds relating
to such interest; or (f) any other transfer prohibited by the terms of the Loan
Agreement.


 


14

















 


Section 6.4.            Lender’s Rights. Except as set forth in the Loan Agreement, Lender reserves the right to
condition the consent required hereunder upon (a) a modification of the terms
hereof and of the Loan Agreement, the Note or the other Loan Documents; (b) an
assumption of the Loan Agreement, the Note, this Mortgage and the other Loan
Documents as so modified by the proposed transferee, subject to the provisions
of Section 9.4 of the Loan Agreement; (c) payment of all of Lender’s reasonable
expenses incurred in connection with such transfer including, without
limitation, the cost of any third party reports, legal fees, rating agency or
required legal opinions; (d) the payment of an assumption fee equal to one
percent (1%) of the outstanding principal balance of the Loan; (e) the
confirmation in writing by the applicable Rating Agencies that the proposed
transfer will not, in and of itself, result in a downgrade, qualification or
withdrawal of the initial, or, if higher, then current ratings assigned in
connection with any Securitization; (f) intentionally deleted; (g) the proposed
transferee’s continued compliance with the representations and covenants set
forth in Section 4.1.30 and 5.2.12 of the Loan Agreement; (h) the delivery of
evidence satisfactory to Lender that the single purpose nature and bankruptcy
remoteness of Borrower following such transfers are in accordance with the then
current standards of Lender and the Rating Agencies, or (i) such other
conditions as Lender shall determine in its reasonable discretion to be in the
interest of Lender, including, without limitation, the creditworthiness,
reputation and qualifications of the transferee with respect to the Loan and
the Property. Lender shall not be required to demonstrate any actual impairment
of its security or any increased risk of default hereunder in order to declare
the Debt immediately due and payable upon Borrower’s sale, conveyance,
mortgage, grant, bargain, encumbrance, pledge, assignment, or transfer of the
Property without Lender’s consent (to the extent such consent is required
hereunder or under the Loan Agreement). This provision shall apply to every
sale, conveyance, mortgage, grant, bargain, encumbrance, pledge, assignment, or
transfer of the Property regardless of whether voluntary or not, or whether or
not Lender has consented to any previous sale, conveyance, mortgage, grant,
bargain, encumbrance, pledge, assignment, or transfer of the Property.


 


ARTICLE 7



RIGHTS AND REMEDIES UPON DEFAULT


 


Section 7.1.            Remedies. Upon the occurrence and during the continuance of any Event of Default,
Borrower agrees that Lender may take such action, without notice or demand, as
it deems advisable to protect and enforce its rights against Borrower and in
and to the Property, including, but not limited to, the following actions, each
of which may be pursued concurrently or otherwise, at such time and in such
order as Lender may determine, in its sole discretion, without impairing or
otherwise affecting the other rights and remedies of Lender:


 


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


 


(b)           institute proceedings, judicial or otherwise, for
the complete foreclosure of this Mortgage under any applicable provision of
law, in which case the Property or any interest 


 


15

















 


therein
may be sold for cash or upon credit in one or more parcels or in several
interests or portions and in any order or manner;


 


(c)           with or without entry, to the extent permitted and
pursuant to the procedures provided by applicable law, institute proceedings
for the partial foreclosure of this Mortgage for the portion of the Debt then
due and payable, subject to the continuing lien and security interest of this
Mortgage for the balance of the Debt not then due, unimpaired and without loss
of priority;


 


(d)           sell for cash or upon credit the Property or any
part thereof and all estate, claim, demand, right, title and interest of
Borrower therein and rights of redemption thereof, pursuant to power of sale or
otherwise, at one or more sales, as an entity or in parcels, at such time and
place, upon such terms and after such notice thereof as may be required or
permitted by law;


 


(e)           institute an action, suit or proceeding in equity
for the specific performance of any covenant, condition or agreement contained
herein, in the Note, the Loan Agreement or in the other Loan Documents;


 


(f)            recover judgment on the Note either before, during
or after any proceedings for the enforcement of this Mortgage or the other Loan
Documents;


 


(g)           apply for the appointment of a receiver, trustee,
liquidator or conservator of the Property, without notice and without regard for
the adequacy of the security for the Debt and without regard for the solvency
of Borrower, any guarantor, indemnitor with respect to the Loan or of any
Person, liable for the payment of the Debt;


 


(h)           the license granted to Borrower under Section 1.2
hereof shall automatically be revoked and Lender may, to the extent permitted
pursuant to procedures provided by applicable law, enter into or upon the
Property, either personally or by its agents, nominees or attorneys and
dispossess Borrower and its agents and servants therefrom, without liability
for trespass, damages or otherwise and exclude Borrower and its agents or
servants wholly therefrom, and take possession of all books, records and
accounts relating thereto and Borrower agrees to surrender possession of the
Property and of such books, records and accounts to Lender upon demand, and
thereupon Lender may (i) use, operate, manage, control, insure, maintain,
repair, restore and otherwise deal with all and every part of the Property and
conduct the business thereat; (ii) complete any construction on the Property in
such manner and form as Lender deems advisable; (iii) make alterations,
additions, renewals, replacements and improvements to or on the Property; (iv)
exercise all rights and powers of Borrower with respect to the Property,
whether in the name of Borrower or otherwise, including, without limitation,
the right to make, cancel, enforce or modify Leases, obtain and evict tenants,
and demand, sue for, collect and receive all Rents of the Property and every
part thereof; (v) require Borrower to pay monthly in advance to Lender, or any
receiver appointed to collect the Rents, the fair and reasonable rental value
for the use and occupation of such part of the Property as may be occupied by
Borrower; (vi) require Borrower to vacate and surrender possession of the
Property 


 


16

















 


to
Lender or to such receiver and, in default thereof, Borrower may be evicted by
summary proceedings or otherwise; and (vii) apply the receipts from the
Property to the payment of the Debt, in such order, priority and proportions as
Lender shall deem appropriate in its sole discretion after deducting therefrom
all expenses (including reasonable attorneys’ fees) incurred in connection with
the aforesaid operations and all amounts necessary to pay the Taxes, Other
Charges, insurance and other expenses in connection with the Property, as well
as just and reasonable compensation for the services of Lender, its counsel,
agents and employees;


 


(i)            exercise any and all rights and remedies granted
to a secured party upon default under the Uniform Commercial Code, including,
without limiting the generality of the foregoing: (i) the right to take
possession of the Fixtures, the Equipment, the Personal Property or any part
thereof, and to take such other measures as Lender may deem necessary for the
care, protection and preservation of the Fixtures, the Equipment, the Personal
Property, and (ii) request Borrower at its expense to assemble the Fixtures,
the Equipment, the Personal Property and make it available to Lender at a
convenient place acceptable to Lender. Any notice of sale, disposition or other
intended action by Lender with respect to the Fixtures, the Equipment, the
Personal Property sent to Borrower in accordance with the provisions hereof at
least five (5) days prior to such action, shall constitute commercially
reasonable notice to Borrower;


 


(j)            apply any sums then deposited or held in escrow or
otherwise by or on behalf of Lender in accordance with the terms of the Loan
Agreement, this Mortgage or any other Loan Document to the payment of the
following items in any order in its uncontrolled discretion:


 


(i)            Taxes and Other Charges;


 


(ii)           Insurance Premiums;


 


(iii)          Interest on the unpaid principal balance of the Note;


 


(iv)          Amortization of the unpaid principal balance of the Note;


 


(v)           All other sums payable pursuant to the Note, the Loan Agreement, this
Mortgage and the other Loan Documents, including without limitation advances
made by Lender pursuant to the terms of this Mortgage;


 


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


 


(l)            apply the undisbursed balance of any Net Proceeds
Deficiency deposit, together with interest thereon, to the payment of the Debt
in such order, priority and proportions as Lender shall deem to be appropriate
in its discretion; or


 


(m)          under
the power of sale granted hereunder or under applicable law, Lender shall have
the discretionary right to cause some or all of the Property, including any
Personal 


 


17

















 


Property, to be sold or otherwise
disposed of in any combination and in any manner permitted by applicable law.


 


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


 


Section 7.2.            Application of Proceeds. The purchase money, proceeds and avails of any
disposition of the Property, and or any part thereof, or any other sums
collected by Lender pursuant to the Note, this Mortgage or the other Loan
Documents, may be applied by Lender to the payment of the Debt in such priority
and proportions as Lender in its discretion shall deem proper.


 


Section 7.3.            Right to Cure Defaults. Upon the occurrence and during the continuance
of any Event of Default or if Borrower fails to make any payment or to do any
act as herein provided, Lender may, but without any obligation to do so and
without notice to or demand on Borrower and without releasing Borrower from any
obligation hereunder, make or do the same in such manner and to such extent as
Lender may deem necessary to protect the security hereof. Lender is authorized
to enter upon action or proceeding to the Property for such purposes, or appear
in, defend, or bring any action or proceeding to protect its interest in the
Property or to foreclose this Mortgage or collect the Debt, and the cost and
expense thereof (including reasonable attorneys’ fees to the extent permitted
by law), with interest as provided in this Section 7.3, shall constitute a
portion of the Debt and shall be due and payable to Lender upon demand. All
such costs and expenses incurred by Lender in remedying such Event of Default
or such failed payment or act or in appearing in, defending, or bringing any
such action or proceeding shall bear interest at the Default Rate, for the
period after notice from Lender that such cost or expense was incurred to the
date of payment to Lender. All such costs and expenses incurred by Lender
together with interest thereon calculated at the Default Rate shall be deemed
to constitute a portion of the Debt and be secured by this Mortgage and the
other Loan Documents and shall be immediately due and payable upon demand by
Lender therefor.


 


Section 7.4.            Actions and Proceedings. Lender has the right to appear in and defend any
action or proceeding brought with respect to the Property and to bring any
action or proceeding, in the name and on behalf of Borrower, which Lender, in
its discretion, decides should be brought to protect its interest in the
Property.


 


Section 7.5.            Recovery of Sums Required To be Paid. Lender shall have the right from time to time to
take action to recover any sum or sums which constitute a part of the Debt as
the same become due, without regard to whether or not the balance of the Debt
shall be due, and without prejudice to the right of Lender thereafter to bring
an action of foreclosure, or any other action, for a default or defaults by
Borrower existing at the time such earlier action was commenced.


 


Section 7.6.            Examination of Books and Records. At reasonable times and upon reasonable notice,
Lender, its agents, accountants and attorneys shall have the right to examine 


 


18

















 


the records, books, management and other
papers of Borrower which reflect upon their financial condition, at the
Property or at any office regularly maintained by Borrower where the books and
records are located. Lender and its agents shall have the right to make copies
and extracts from the foregoing records and other papers. In addition, at
reasonable times and upon reasonable notice, Lender, its agents, accountants
and attorneys shall have the right to examine and audit the books and records
of Borrower pertaining to the income, expenses and operation of the Property
during reasonable business hours at any office of Borrower where the books and
records are located. This Section 7.6 shall apply throughout the term of the
Note and without regard to whether an Event of Default has occurred or is
continuing. The action contemplated
by this Section 7.6 shall be at Lender’s sole cost and expense, unless
an Event of Default shall be continuing, in which event such action shall be
at Borrower’s sole cost and expense.


 


Section 7.7.            Other Rights, Etc.


 


(a)           The failure of Lender to insist upon strict
performance of any term hereof shall not be deemed to be a waiver of any term
of this Mortgage. Borrower shall not be relieved of Borrower’s obligations
hereunder by reason of (i) the failure of Lender to comply with any request of
Borrower or any guarantor or indemnitor with respect to the Loan to take any
action to foreclose this Mortgage or otherwise enforce any of the provisions
hereof or of the Note or the other Loan Documents, (ii) the release, regardless
of consideration, of the whole or any part of the Property, or of any person
liable for the Debt or any portion thereof, or (iii) any agreement or
stipulation by Lender extending the time of payment or otherwise modifying or
supplementing the terms of the Note, this Mortgage or the other Loan Documents.


 


(b)           It is agreed that the risk of loss or damage to
the Property is on Borrower, and Lender shall have no liability whatsoever for
decline in value of the Property, for failure to maintain the Policies, or for
failure to determine whether insurance in force is adequate as to the amount of
risks insured. Possession by Lender shall not be deemed an election of judicial
relief, if any such possession is requested or obtained, with respect to any
Property or collateral not in Lender’s possession.


 


(c)           Lender may resort for the payment of the Debt to
any other security held by Lender in such order and manner as Lender, in its
discretion, may elect. Lender may take action to recover the Debt, or any
portion thereof, or to enforce any covenant hereof without prejudice to the
right of Lender thereafter to foreclose this Mortgage. The rights of Lender
under this Mortgage shall be separate, distinct and cumulative and none shall
be given effect to the exclusion of the others. No act of Lender shall be
construed as an election to proceed under any one provision herein to the
exclusion of any other provision. Lender shall not be limited exclusively to
the rights and remedies herein stated but shall be entitled to every right and
remedy now or hereafter afforded at law or in equity.


 


Section 7.8.            Right to Release Any Portion of the Property. Lender may release any portion of the Property
for such consideration as Lender may require without, as to the remainder of
the Property, in any way impairing or affecting the lien or priority of this
Mortgage, or improving the position of any subordinate lienholder with respect
thereto, except to the extent 


 


19

















 


that the obligations hereunder shall have
been reduced by the actual monetary consideration, if any, received by Lender
for such release, and may accept by assignment, pledge or otherwise any other
property in place thereof as Lender may require without being accountable for
so doing to any other lienholder. This Mortgage shall continue as a lien and
security interest in the remaining portion of the Property.


 


Section 7.9.            Violation of Laws. If the Property is not in material compliance
with Legal Requirements, Lender may impose additional requirements upon
Borrower in connection herewith including, without limitation, monetary
reserves or financial equivalents.


 


Section 7.10.          Recourse and Choice of Remedies. Notwithstanding any other provision of this
Mortgage or the Loan Agreement, including, without limitation, Section 9.4 of
the Loan Agreement, Lender and other Indemnified Parties (as hereinafter
defined) are entitled to enforce the obligations of Borrower, any guarantor or
indemnitor contained in Sections 9.2, 9.3 and 9.4 herein and Section 9.4 of the
Loan Agreement without first resorting to or exhausting any security or
collateral and without first having recourse to the Note or any of the
Property, through foreclosure or acceptance of a deed in lieu of foreclosure or
otherwise, and in the event Lender commences a foreclosure action against the
Property, Lender is entitled to pursue a deficiency judgment with respect to
such obligations against Borrower and any guarantor or indemnitor with respect
to the Loan. The provisions of Sections 9.2, 9.3 and 9.4 herein and Section 9.4
of the Loan Agreement are exceptions to any non-recourse or exculpation
provisions in the Loan Agreement, the Note, this Mortgage or the other Loan
Documents, and Borrower and any guarantor or indemnitor with respect to the
Loan are fully and personally liable for the obligations pursuant to Sections
9.2, 9.3 and 9.4 herein and Section 9.4 of the Loan Agreement. The liability of
Borrower and any guarantor or indemnitor with respect to the Loan pursuant to
Sections 9.2, 9.3 and 9.4 herein and Section 9.4 of the Loan Agreement is not
limited to the original principal amount of the Note. Notwithstanding the
foregoing, nothing herein shall inhibit or prevent Lender from foreclosing or
exercising any other rights and remedies pursuant to the Loan Agreement, the
Note, this Mortgage and the other Loan Documents, whether simultaneously with
foreclosure proceedings or in any other sequence. A separate action or actions
may be brought and prosecuted against Borrower pursuant to Sections 9.2, 9.3
and 9.4 herein and Section 9.4 of the Loan Agreement, whether or not action is
brought against any other Person or whether or not any other Person is joined
in the action or actions. In addition, Lender shall have the right but not the
obligation to join and participate in, as a party if it so elects, any
administrative or judicial proceedings or actions initiated in connection with
any matter addressed in Article 8 or Section 9.4 herein.


 


Section 7.11.          Right of Entry. Upon reasonable notice to Borrower, Lender and its agents shall have the
right to enter and inspect the Property at all reasonable times.


 


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


 


20

















 


ARTICLE 8



ENVIRONMENTAL HAZARDS


 


Section 8.1.            Environmental Representations and Warranties. To the best of Borrower’s knowledge, and except
as otherwise disclosed by that certain Environmental Site Assessment of the
Property delivered to Lender (such report is referred to below as the “Environmental Report”), Borrower
hereby represents and warrants (a) to the best of Borrower’s knowledge, based
on the Environmental Report, there are no Hazardous Substances (defined below)
or underground storage tanks in, on, or under the Property, except those that
are both (i) in compliance with Environmental Laws (defined below) and with
permits issued pursuant thereto and (ii) fully disclosed to Lender in writing
pursuant the Environmental Report; (b) there are no past, present or threatened
Releases (defined below) of Hazardous Substances in, on, under or from the
Property which has not been fully remediated in accordance with Environmental
Law; (c) there is no threat of any Release of Hazardous Substances migrating to
the Property; (d) there is no past or present non-compliance with Environmental
Laws, or with permits issued pursuant thereto, in connection with the Property
which has not been fully remediated in accordance with Environmental Law; (e)
Borrower does not know of, and has not received, any written or oral notice or
other communication from any Person (including but not limited to a
governmental entity) relating to Hazardous Substances or Remediation (defined
below) thereof, of possible liability of any Person pursuant to any Environmental
Law, other environmental conditions in connection with the Property, or any
actual or potential administrative or judicial proceedings in connection with
any of the foregoing; and (f) Borrower has truthfully and fully provided to
Lender, in writing, any and all information relating to conditions in, on,
under or from the Property that is known to Borrower and that is contained in
Borrower’s files and records, including but not limited to any reports relating
to Hazardous Substances in, on, under or from the Property and/or to the
environmental condition of the Property. “Environmental Law”
means any present and future federal, applicable state and local laws,
statutes, ordinances, rules, regulations and the like, as well as common law,
relating to protection of human health or the environment, relating to
Hazardous Substances, relating to liability for or costs of Remediation or
prevention of Releases of Hazardous Substances or relating to liability for or
costs of other actual or threatened danger to human health or the environment.
Environmental Law includes, but is not limited to, the following statutes, as
amended, any successor thereto, and any regulations promulgated pursuant
thereto, and any applicable state or local statutes, ordinances, rules,
regulations and the like addressing similar issues:  the Comprehensive Environmental Response,
Compensation and Liability Act; the Emergency Planning and Community
Right-to-Know Act; the Hazardous Substances Transportation Act; the Resource
Conservation and Recovery Act (including but not limited to Subtitle I relating
to underground storage tanks); the Solid Waste Disposal Act; the Clean Water
Act; the Clean Air Act; the Toxic Substances Control Act; the Safe Drinking
Water Act; the Occupational Safety and Health Act; the Federal Water Pollution
Control Act; the Federal Insecticide, Fungicide and Rodenticide Act; the
Endangered Species Act; the National Environmental Policy Act; and the River
and Harbors Appropriation Act. Environmental Law also includes, but is not
limited to, any present and future federal, applicable state and local laws, 


 


21

















 


statutes, ordinances, rules, regulations and the like, as well as
common law:  conditioning transfer of
property upon a negative declaration or other approval of a governmental
authority of the environmental condition of the Property; requiring
notification or disclosure of Releases of Hazardous Substances or other
environmental condition of the Property to any governmental authority or other
Person, whether or not in connection with transfer of title to or interest in
property; imposing conditions or requirements in connection with permits or
other authorization for lawful activity; relating to nuisance, trespass or
other causes of action related to the Property; and relating to wrongful death,
personal injury, or property or other damage in connection with any physical
condition or use of the Property.


 


“Hazardous Substances”
include but are not limited to any and all substances (whether solid, liquid or
gas) defined, listed, or otherwise classified as pollutants, hazardous wastes,
hazardous substances, hazardous materials, extremely hazardous wastes, or words
of similar meaning or regulatory effect under any present or future
Environmental Laws or that may have a negative impact on human health or the
environment, including but not limited to petroleum and petroleum products,
asbestos and asbestos-containing materials, polychlorinated biphenyls, lead,
radon, radioactive materials, flammables and explosives, but excluding
substances of kinds and in amounts ordinarily and customarily used or stored in
similar properties for the purpose of cleaning or other maintenance or
operations and otherwise in compliance with all Environmental Laws.


 


“Release” of
any Hazardous Substance includes but is not limited to any release, deposit,
discharge, emission, leaking, spilling, seeping, migrating, injecting, pumping,
pouring, emptying, escaping, dumping, disposing or other movement of Hazardous
Substances.


 


“Remediation”
includes but is not limited to any response, remedial, removal, or corrective
action, any activity to cleanup, detoxify, decontaminate, contain or otherwise
remediate any Hazardous Substance, any actions to prevent, cure or mitigate any
Release of any Hazardous Substance, any action to comply with any Environmental
Laws or with any permits issued pursuant thereto, any inspection,
investigation, study, monitoring, assessment, audit, sampling and testing,
laboratory or other analysis, or evaluation relating to any Hazardous
Substances or to anything referred to in Article 8.


 


Section 8.2.            Environmental Covenants. Borrower covenants and agrees that: (a) all uses
and operations on or of the Property, whether by Borrower or any other Person,
shall be in compliance with all Environmental Laws and permits issued pursuant
thereto; (b) Borrower shall not cause or permit the Release of any Hazardous
Substances in, on, under or from the Property; (c) there shall be no Hazardous
Substances in, on, or under the Property, except those that are both (i) in
compliance with all Environmental Laws and with permits issued pursuant thereto
and (ii) fully disclosed to Lender in writing; (d) Borrower shall keep the
Property free and clear of all liens and other encumbrances imposed pursuant to
any Environmental Law, whether due to any act or omission of Borrower or any
other Person (the “Environmental Liens”);
(e) Borrower shall, at its sole cost and expense, fully and expeditiously
cooperate in all activities pursuant to Section 8.3 below, including but not
limited to providing all relevant 


 


22

















 


information and making knowledgeable persons
available for interviews; (f) Borrower shall, at its sole cost and expense,
perform any environmental site assessment or other investigation of
environmental conditions in connection with the Property, pursuant to any
reasonable written request of Lender made in the event that Lender has a good
faith reason to believe based upon credible evidence or information that an
environmental hazard exists on or affects the Property (including but not
limited to sampling, testing and analysis of soil, water, air, building
materials and other materials and substances whether solid, liquid or gas), and
share with Lender the reports and other results thereof, and Lender and other
Indemnified Parties shall be entitled to rely on such reports and other results
thereof; (g) Borrower shall, at its sole cost and expense, comply with all
reasonable written requests of Lender made in the event that Lender has a good
faith reason to believe based upon credible evidence or information that an
environmental hazard exists on or affects the Property to (i) reasonably
effectuate Remediation of any condition (including but not limited to a Release
of a Hazardous Substance) in, on, under or from the Property; (ii) comply with
any Environmental Law; (iii) comply with any directive from any governmental
authority; and (iv) take any other reasonable action necessary or appropriate
for protection of human health or the environment; (h) Borrower shall not do or
knowingly allow any tenant or other user of the Property to do any act that
materially increases the dangers to human health or the environment, poses an
unreasonable risk of harm to any Person (whether on or off the Property),
impairs or may impair the value of the Property, is contrary to any requirement
of any insurer, constitutes a public or private nuisance, constitutes waste, or
violates any covenant, condition, agreement or easement applicable to the
Property; and (i) Borrower shall immediately notify Lender in writing of (A)
any presence or Releases or threatened Releases of Hazardous Substances in, on,
under, from or migrating towards the Property; (B) any non-compliance with any
Environmental Laws related in any way to the Property; (C) any actual or
potential Environmental Lien; (D) any required or proposed Remediation of
environmental conditions relating to the Property; and (E) any written or oral
notice or other communication of which Borrower becomes aware from any source
whatsoever (including but not limited to a governmental entity) relating in any
way to Hazardous Substances or Remediation thereof, possible liability of any
Person pursuant to any Environmental Law, other environmental conditions in
connection with the Property, or any actual or potential administrative or
judicial proceedings in connection with anything referred to in this Article 8.


 


Section 8.3.            Lender’s Rights. In the event that Lender has a good faith reason to believe based upon
credible evidence or information that an environmental hazard exists on the
Property, upon reasonable notice from Lender, Borrower shall, at Borrower’s
expense, promptly cause an engineer or consultant satisfactory to Lender to
conduct any environmental assessment or audit (the scope of which shall be
determined in Lender’s sole and absolute discretion) and take any samples of
soil, groundwater or other water, air, or building materials or any other
invasive testing requested by Lender and promptly deliver the results of any
such assessment, audit, sampling or other testing; provided, however, if such
results are not delivered to Lender within a reasonable period, upon reasonable
notice to Borrower, Lender and any other Person designated by Lender, including
but not limited to any receiver, any representative of a governmental entity,
and any environmental consultant, shall have the right, but not the obligation,
to enter upon the Property at all reasonable times to assess any and all
aspects of the 


 


23

















 


environmental condition of the Property and
its use, including but not limited to conducting any environmental assessment
or audit (the scope of which shall be determined in Lender’s sole and absolute
discretion) and taking samples of soil, groundwater or other water, air, or
building materials, and reasonably conducting other invasive testing. Borrower
shall cooperate with and provide access to Lender and any such Person
designated by Lender.


 


ARTICLE 9



INDEMNIFICATIONS


 


Section 9.1.            GENERAL INDEMNIFICATION. BORROWER SHALL, AT ITS SOLE
COST AND EXPENSE, PROTECT, DEFEND, INDEMNIFY, RELEASE AND HOLD HARMLESS THE
INDEMNIFIED PARTIES FROM AND AGAINST ANY AND ALL CLAIMS, SUITS, LIABILITIES
(INCLUDING, WITHOUT LIMITATION, STRICT LIABILITIES), ACTIONS, PROCEEDINGS,
OBLIGATIONS, DEBTS, DAMAGES, LOSSES, COSTS, EXPENSES, DIMINUTIONS IN VALUE,
FINES, PENALTIES, CHARGES, FEES, EXPENSES, JUDGMENTS, AWARDS, AMOUNTS PAID IN
SETTLEMENT, PUNITIVE DAMAGES, FORESEEABLE AND UNFORESEEABLE CONSEQUENTIAL
DAMAGES, OF WHATEVER KIND OR NATURE (INCLUDING BUT NOT LIMITED TO REASONABLE
ATTORNEYS’ FEES AND OTHER COSTS OF DEFENSE) (COLLECTIVELY, THE “LOSSES”)
IMPOSED UPON OR INCURRED BY OR ASSERTED AGAINST ANY INDEMNIFIED PARTIES AND
DIRECTLY OR INDIRECTLY ARISING OUT OF OR IN ANY WAY RELATING TO ANY ONE OR MORE
OF THE FOLLOWING: (A) OWNERSHIP OF THIS MORTGAGE, THE PROPERTY OR ANY INTEREST
THEREIN OR RECEIPT OF ANY RENTS; (B) ANY AMENDMENT TO, OR RESTRUCTURING OF, THE
DEBT, AND THE NOTE, THE LOAN AGREEMENT, THIS MORTGAGE, OR ANY OTHER LOAN
DOCUMENTS; (C) ANY AND ALL LAWFUL ACTION THAT MAY BE TAKEN BY LENDER IN
CONNECTION WITH THE ENFORCEMENT OF THE PROVISIONS OF THIS MORTGAGE OR THE LOAN
AGREEMENT OR THE NOTE OR ANY OF THE OTHER LOAN DOCUMENTS, WHETHER OR NOT SUIT
IS FILED IN CONNECTION WITH SAME, OR IN CONNECTION WITH BORROWER, ANY GUARANTOR
OR INDEMNITOR AND/OR ANY PARTNER, JOINT VENTURER OR SHAREHOLDER THEREOF BECOMING
A PARTY TO A VOLUNTARY OR INVOLUNTARY FEDERAL OR STATE BANKRUPTCY, INSOLVENCY
OR SIMILAR PROCEEDING; (D) ANY ACCIDENT, INJURY TO OR DEATH OF PERSONS OR LOSS
OF OR DAMAGE TO PROPERTY OCCURRING IN, ON OR ABOUT THE PROPERTY OR ANY PART
THEREOF OR ON THE ADJOINING SIDEWALKS, CURBS, ADJACENT PROPERTY OR ADJACENT
PARKING AREAS, STREETS OR WAYS; (E) PERFORMANCE OF ANY LABOR OR SERVICES OR THE
FURNISHING OF ANY MATERIALS OR OTHER PROPERTY IN RESPECT OF THE PROPERTY OR ANY
PART THEREOF; (F) THE FAILURE OF ANY PERSON TO FILE TIMELY WITH THE INTERNAL
REVENUE SERVICE AN ACCURATE FORM 1099-B, STATEMENT FOR RECIPIENTS OF PROCEEDS
FROM REAL ESTATE, BROKER 


 


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AND BARTER EXCHANGE TRANSACTIONS, WHICH MAY
BE REQUIRED IN CONNECTION WITH THIS MORTGAGE, OR TO SUPPLY A COPY THEREOF IN A
TIMELY FASHION TO THE RECIPIENT OF THE PROCEEDS OF THE TRANSACTION IN
CONNECTION WITH WHICH THIS MORTGAGE IS MADE; (G) ANY FAILURE OF THE PROPERTY TO
BE IN COMPLIANCE WITH ANY LEGAL REQUIREMENTS; (H) THE ENFORCEMENT BY ANY
INDEMNIFIED PARTY OF THE PROVISIONS OF THIS ARTICLE 9; (I) ANY AND ALL CLAIMS
AND DEMANDS WHATSOEVER WHICH MAY BE ASSERTED AGAINST LENDER BY REASON OF ANY
ALLEGED OBLIGATIONS OR UNDERTAKINGS ON ITS PART TO PERFORM OR DISCHARGE ANY OF
THE TERMS, COVENANTS, OR AGREEMENTS CONTAINED IN ANY LEASE; (J) THE PAYMENT OF
ANY COMMISSION, CHARGE OR BROKERAGE FEE TO ANYONE CLAIMING THROUGH BORROWER
WHICH MAY BE PAYABLE IN CONNECTION WITH THE FUNDING OF THE LOAN; OR (K) ANY
MISREPRESENTATION MADE BY BORROWER IN THIS MORTGAGE OR ANY OTHER LOAN DOCUMENT.
NOTWITHSTANDING THE FOREGOING, BORROWER SHALL NOT BE LIABLE TO THE INDEMNIFIED
PARTIES UNDER THIS SECTION 9.1 FOR ANY LOSSES TO WHICH THE INDEMNIFIED PARTIES
MAY BECOME SUBJECT TO THE EXTENT SUCH LOSSES ARISE BY REASON OF THE GROSS
NEGLIGENCE, ILLEGAL ACTS, FRAUD OR WILLFUL MISCONDUCT OF THE INDEMNIFIED
PARTIES OR LOSSES RESULTING FROM ACTS OR OMISSIONS ARISING AFTER A COMPLETED
FORECLOSURE OF THE PROPERTY OR ACCEPTANCE BY LENDER OF A DEED IN LIEU OF
FORECLOSURE. ANY AMOUNTS PAYABLE TO LENDER BY REASON OF THE APPLICATION OF THIS
SECTION 9.1 SHALL BECOME IMMEDIATELY DUE AND PAYABLE AND SHALL BEAR INTEREST AT
THE DEFAULT RATE FROM THE DATE LOSS OR DAMAGE IS SUSTAINED BY LENDER UNTIL PAID.
FOR PURPOSES OF THIS ARTICLE 9, THE TERM “INDEMNIFIED PARTIES” MEANS LENDER AND
ANY PERSON WHO IS OR WILL HAVE BEEN INVOLVED IN THE ORIGINATION OF THE LOAN,
ANY PERSON WHO IS OR WILL HAVE BEEN INVOLVED IN THE SERVICING OF THE LOAN
SECURED HEREBY, ANY PERSON IN WHOSE NAME THE ENCUMBRANCE CREATED BY THIS
MORTGAGE IS OR WILL HAVE BEEN RECORDED, PERSONS AND ENTITIES WHO MAY HOLD OR
ACQUIRE OR WILL HAVE HELD A FULL OR PARTIAL INTEREST IN THE LOAN SECURED HEREBY
(INCLUDING, BUT NOT LIMITED TO, INVESTORS OR PROSPECTIVE INVESTORS IN THE
SECURITIES, AS WELL AS CUSTODIANS, TRUSTEES AND OTHER FIDUCIARIES WHO HOLD OR
HAVE HELD A FULL OR PARTIAL INTEREST IN THE LOAN SECURED HEREBY FOR THE BENEFIT
OF THIRD PARTIES) AS WELL AS THE RESPECTIVE DIRECTORS, OFFICERS, SHAREHOLDERS,
PARTNERS, EMPLOYEES, AGENTS, SERVANTS, REPRESENTATIVES, CONTRACTORS,
SUBCONTRACTORS, AFFILIATES, SUBSIDIARIES, PARTICIPANTS, SUCCESSORS AND ASSIGNS
OF ANY AND ALL OF THE FOREGOING (INCLUDING BUT NOT LIMITED TO ANY OTHER PERSON
WHO HOLDS OR ACQUIRES OR WILL HAVE HELD A PARTICIPATION OR OTHER FULL OR
PARTIAL INTEREST IN THE 


 


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LOAN, WHETHER DURING THE TERM OF THE LOAN OR
AS A PART OF OR FOLLOWING A FORECLOSURE OF THE LOAN AND INCLUDING, BUT NOT
LIMITED TO, ANY SUCCESSORS BY MERGER, CONSOLIDATION OR ACQUISITION OF ALL OR A
SUBSTANTIAL PORTION OF LENDER’S ASSETS AND BUSINESS).


 


Section 9.2.            MORTGAGE AND/OR INTANGIBLE TAX. BORROWER SHALL, AT ITS SOLE
COST AND EXPENSE, PROTECT, DEFEND, INDEMNIFY, RELEASE AND HOLD HARMLESS THE
INDEMNIFIED PARTIES FROM AND AGAINST ANY AND ALL LOSSES IMPOSED UPON OR
INCURRED BY OR ASSERTED AGAINST ANY INDEMNIFIED PARTIES AND DIRECTLY OR
INDIRECTLY ARISING OUT OF OR IN ANY WAY RELATING TO ANY TAX ON THE MAKING
AND/OR RECORDING OF THIS MORTGAGE, THE NOTE OR ANY OF THE OTHER LOAN DOCUMENTS,
BUT EXCLUDING ANY INCOME, FRANCHISE OR OTHER SIMILAR TAXES. BORROWER HEREBY
AGREES THAT, IN THE EVENT THAT IT IS DETERMINED THAT ANY DOCUMENTARY STAMP
TAXES OR INTANGIBLE PERSONAL PROPERTY TAXES ARE DUE HEREON OR ON ANY MORTGAGE
OR PROMISSORY NOTE EXECUTED IN CONNECTION HEREWITH (INCLUDING, WITHOUT
LIMITATION, THE NOTE), BORROWER SHALL INDEMNIFY AND HOLD HARMLESS THE
INDEMNIFIED PARTIES FOR ALL SUCH DOCUMENTARY STAMP AND/OR INTANGIBLE TAXES,
INCLUDING ALL PENALTIES AND INTEREST ASSESSED OR CHARGED IN CONNECTION
THEREWITH.


 


Section 9.3.            ERISA INDEMNIFICATION. BORROWER SHALL, AT ITS SOLE
COST AND EXPENSE, PROTECT, DEFEND, INDEMNIFY, RELEASE AND HOLD HARMLESS THE
INDEMNIFIED PARTIES FROM AND AGAINST ANY AND ALL LOSSES (INCLUDING, WITHOUT
LIMITATION, REASONABLE ATTORNEYS’ FEES AND COSTS INCURRED IN THE INVESTIGATION,
DEFENSE, AND SETTLEMENT OF LOSSES INCURRED IN CORRECTING ANY PROHIBITED
TRANSACTION OR IN THE SALE OF A PROHIBITED LOAN, AND IN OBTAINING ANY
INDIVIDUAL PROHIBITED TRANSACTION EXEMPTION UNDER ERISA THAT MAY BE REQUIRED,
IN LENDER’S SOLE DISCRETION) THAT LENDER MAY INCUR, DIRECTLY OR INDIRECTLY, AS
A RESULT OF A DEFAULT UNDER SECTIONS 4.1.9 OR 5.2.12 OF THE LOAN AGREEMENT.


 


Section 9.4.            ENVIRONMENTAL INDEMNIFICATION. BORROWER SHALL, AT ITS SOLE
COST AND EXPENSE, PROTECT, DEFEND, INDEMNIFY, RELEASE AND HOLD HARMLESS THE
INDEMNIFIED PARTIES FROM AND AGAINST ANY AND ALL LOSSES AND COSTS OF
REMEDIATION (WHETHER OR NOT PERFORMED VOLUNTARILY), ENGINEERS’ FEES, ENVIRONMENTAL
CONSULTANTS’ FEES, AND COSTS OF INVESTIGATION (INCLUDING BUT NOT LIMITED TO
SAMPLING, TESTING, AND ANALYSIS OF SOIL, WATER, AIR, BUILDING MATERIALS AND
OTHER MATERIALS AND SUBSTANCES WHETHER 


 


26

















 


SOLID, LIQUID OR GAS) IMPOSED UPON OR
INCURRED BY OR ASSERTED AGAINST ANY INDEMNIFIED PARTIES, AND DIRECTLY OR
INDIRECTLY ARISING OUT OF OR IN ANY WAY RELATING TO ANY ONE OR MORE OF THE
FOLLOWING: (A) ANY PRESENCE OF ANY HAZARDOUS SUBSTANCES IN, ON, ABOVE, OR UNDER
THE PROPERTY; (B) ANY PAST, PRESENT OR THREATENED RELEASE OF HAZARDOUS
SUBSTANCES IN, ON, ABOVE, UNDER OR FROM THE PROPERTY; (C) ANY ACTIVITY BY
BORROWER, ANY PERSON AFFILIATED WITH BORROWER OR ANY TENANT OR OTHER USER OF
THE PROPERTY IN CONNECTION WITH ANY ACTUAL, PROPOSED OR THREATENED USE,
TREATMENT, STORAGE, HOLDING, EXISTENCE, DISPOSITION OR OTHER RELEASE,
GENERATION, PRODUCTION, MANUFACTURING, PROCESSING, REFINING, CONTROL,
MANAGEMENT, ABATEMENT, REMOVAL, HANDLING, TRANSFER OR TRANSPORTATION TO OR FROM
THE PROPERTY OF ANY HAZARDOUS SUBSTANCES AT ANY TIME LOCATED IN, UNDER, ON OR
ABOVE THE PROPERTY; (D) ANY ACTIVITY BY BORROWER, ANY PERSON AFFILIATED WITH
BORROWER OR ANY TENANT OR OTHER USER OF THE PROPERTY IN CONNECTION WITH ANY
ACTUAL OR PROPOSED REMEDIATION OF ANY HAZARDOUS SUBSTANCES AT ANY TIME LOCATED
IN, UNDER, ON OR ABOVE THE PROPERTY, WHETHER OR NOT SUCH REMEDIATION IS
VOLUNTARY OR PURSUANT TO COURT OR ADMINISTRATIVE ORDER, INCLUDING BUT NOT
LIMITED TO ANY REMOVAL, REMEDIAL OR CORRECTIVE ACTION; (E) ANY PAST OR PRESENT
NON-COMPLIANCE OR VIOLATIONS OF ANY ENVIRONMENTAL LAWS (OR PERMITS ISSUED
PURSUANT TO ANY ENVIRONMENTAL LAW) IN CONNECTION WITH THE PROPERTY OR
OPERATIONS THEREON, INCLUDING BUT NOT LIMITED TO ANY FAILURE BY BORROWER, ANY
AFFILIATE OF BORROWER OR ANY TENANT OR OTHER USER OF THE PROPERTY TO COMPLY
WITH ANY ORDER OF ANY GOVERNMENTAL AUTHORITY IN CONNECTION WITH ANY
ENVIRONMENTAL LAWS; (F) THE IMPOSITION, RECORDING OR FILING OF ANY
ENVIRONMENTAL LIEN ENCUMBERING THE PROPERTY; (G) ANY ADMINISTRATIVE PROCESSES
OR PROCEEDINGS OR JUDICIAL PROCEEDINGS IN ANY WAY CONNECTED WITH ANY MATTER
ADDRESSED IN ARTICLE 8 AND THIS SECTION 9.4; (H) ANY PAST, PRESENT OR
THREATENED INJURY TO, DESTRUCTION OF OR LOSS OF NATURAL RESOURCES IN ANY WAY
CONNECTED WITH THE PROPERTY, INCLUDING BUT NOT LIMITED TO COSTS TO INVESTIGATE
AND ASSESS SUCH INJURY, DESTRUCTION OR LOSS; (I) ANY ACTS OF BORROWER OR OTHER
USERS OF THE PROPERTY IN ARRANGING FOR DISPOSAL OR TREATMENT, OR ARRANGING WITH
A TRANSPORTER FOR TRANSPORT FOR DISPOSAL OR TREATMENT, OF HAZARDOUS SUBSTANCES
OWNED OR POSSESSED BY SUCH BORROWER OR OTHER USERS, AT ANY FACILITY OR
INCINERATION VESSEL OWNED OR OPERATED BY ANOTHER PERSON AND CONTAINING SUCH OR
ANY SIMILAR HAZARDOUS SUBSTANCE; (J) ANY ACTS OF BORROWER OR OTHER USERS OF THE
PROPERTY, IN ACCEPTING ANY HAZARDOUS SUBSTANCES FOR TRANSPORT TO DISPOSAL 


 


27

















 


OR TREATMENT FACILITIES, INCINERATION VESSELS
OR SITES SELECTED BY BORROWER OR SUCH OTHER USERS, FROM WHICH THERE IS A
RELEASE, OR A THREATENED RELEASE OF ANY HAZARDOUS SUBSTANCE WHICH CAUSES THE
INCURRENCE OF COSTS FOR REMEDIATION; (K) ANY PERSONAL INJURY, WRONGFUL DEATH,
OR PROPERTY DAMAGE ARISING UNDER ANY STATUTORY OR COMMON LAW OR TORT LAW THEORY,
INCLUDING BUT NOT LIMITED TO DAMAGES ASSESSED FOR THE MAINTENANCE OF A PRIVATE
OR PUBLIC NUISANCE OR FOR THE CONDUCTING OF AN ABNORMALLY DANGEROUS ACTIVITY ON
OR NEAR THE PROPERTY; AND (1) ANY MISREPRESENTATION OR INACCURACY IN ANY
REPRESENTATION OR WARRANTY OR MATERIAL BREACH OR FAILURE TO PERFORM ANY
COVENANTS OR OTHER OBLIGATIONS PURSUANT TO ARTICLE 8. NOTWITHSTANDING THE
FOREGOING, BORROWER SHALL NOT BE LIABLE UNDER THIS SECTION 9.4 FOR ANY LOSSES
OR COSTS OF REMEDIATION TO WHICH THE INDEMNIFIED PARTIES MAY BECOME SUBJECT TO
THE EXTENT SUCH LOSSES OR COSTS OF REMEDIATION ARISE BY REASON OF THE GROSS
NEGLIGENCE, ILLEGAL ACTS, FRAUD OR WILLFUL MISCONDUCT OF THE INDEMNIFIED
PARTIES OR LOSSES RESULTING FROM ACTS OR OMISSIONS ARISING AFTER A COMPLETED
FORECLOSURE OF THE PROPERTY OR ACCEPTANCE BY LENDER OF A DEED IN LIEU OF
FORECLOSURE. THIS INDEMNITY SHALL SURVIVE ANY TERMINATION, SATISFACTION OR
FORECLOSURE OF THIS MORTGAGE, SUBJECT TO THE PROVISIONS OF SECTION 10.5.


 


Section 9.5.            Duty to Defend; Attorneys’ Fees and Other Fees and
Expenses. Upon written request by
any Indemnified Party, Borrower shall defend such Indemnified Party (if
requested by any Indemnified Party, in the name of the Indemnified Party) by
attorneys and other professionals approved by the Indemnified Parties. Notwithstanding
the foregoing, if the defendants in any such claim or proceeding include both
Borrower and any Indemnified Party and Borrower and such Indemnified Party
shall have reasonably concluded that there are any legal defenses available to
it and/or other Indemnified Parties that are different from or additional to
those available to Borrower, such Indemnified Party shall have the right to
select separate counsel to assert such legal defenses and to otherwise
participate in the defense of such action on behalf of such Indemnified Party,
provided that no compromise or settlement shall be entered without Borrower’s
consent, which consent shall not be unreasonably withheld. Upon demand,
Borrower shall pay or, in the sole and absolute discretion of the Indemnified
Parties, reimburse, the Indemnified Parties for the payment of reasonable fees
and disbursements of attorneys, engineers, environmental consultants,
laboratories and other professionals in connection therewith.


 


28

















 


ARTICLE 10



WAIVERS


 


Section 10.1.          Waiver of Counterclaim. To the extent permitted by applicable law,
Borrower hereby waives the right to assert a counterclaim, other than a
mandatory or compulsory counterclaim, in any action or proceeding brought
against it by Lender arising out of or in any way connected with this Mortgage,
the Loan Agreement, the Note, any of the other Loan Documents, or the
Obligations.


 


Section 10.2.          Marshalling and Other Matters. To the fullest extent permitted by applicable
law, Borrower hereby waives the benefit of all appraisement, valuation, stay,
extension, reinstatement and redemption laws now or hereafter in force and all
rights of marshalling in the event of any sale hereunder of the Property or any
part thereof or any interest therein. Further, Borrower hereby expressly waives
any and all rights of redemption from sale under any order or decree of
foreclosure of this Mortgage on behalf of Borrower, and on behalf of each and
every person acquiring any interest in or title to the Property subsequent to
the date of this Mortgage and on behalf of all persons to the extent permitted
by applicable law.


 


Section 10.3.          Waiver of Notice. To the extent permitted by applicable law, Borrower shall not be
entitled to any notices of any nature whatsoever from Lender except with
respect to matters for which this Mortgage specifically and expressly provides
for the giving of notice by Lender to Borrower and except with respect to
matters for which Lender is required by applicable law to give notice, and
Borrower hereby expressly waives the right to receive any notice from Lender
with respect to any matter for which this Mortgage does not specifically and
expressly provide for the giving of notice by Lender to Borrower.


 


Section 10.4.          Waiver of Statute of Limitations. To the extent permitted by applicable law,
Borrower hereby expressly waives and releases to the fullest extent permitted
by law, the pleading of any statute of limitations as a defense to payment of
the Debt or performance of its Other Obligations.


 


Section 10.5.          Survival. The indemnifications made pursuant to Sections 9.3 and 9.4 herein and
the representations and warranties, covenants, and other obligations arising
under Article 8, shall continue indefinitely in full force and effect and shall
survive and shall in no way be impaired by: 
any satisfaction or other termination of this Mortgage, any assignment
or other transfer of all or any portion of this Mortgage or Lender’s interest
in the Property (but, in such case, shall benefit both Indemnified Parties and
any assignee or transferee), any exercise of Lender’s rights and remedies
pursuant hereto including but not limited to foreclosure or acceptance of a
deed in lieu of foreclosure, any exercise of any rights and remedies pursuant
to the Loan Agreement, the Note or any of the other Loan Documents, any
transfer of all or any portion of the Property (whether by Borrower or by
Lender following foreclosure or acceptance of a deed in lieu of foreclosure or
at any other time), any amendment to this Mortgage, the Loan Agreement, the
Note or the other Loan Documents, and any act or omission that might otherwise
be construed as a release or discharge of Borrower from the obligations
pursuant hereto. Notwithstanding anything to the contrary contained in this
Mortgage or the other Loan Documents, Borrower shall not have any obligations
or liabilities under the indemnification under Section 9.4 herein or other
indemnifications with respect to Hazardous Substances 


 


29

















 


contained in the other Loan Documents with
respect to those obligations and liabilities that Borrower can prove arose
solely from Hazardous Substances that (i) were not present on or a threat to
the Property prior to the date that Lender or its nominee acquired title to the
Property, whether by foreclosure, exercise by power of sale, acceptance of a
deed-in-lieu of foreclosure or otherwise and (ii) were not the result of any
act or negligence of Borrower or any of Borrower’s affiliates, agents or
contractors.


 


ARTICLE 11



EXCULPATION


 


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


 


ARTICLE 12



NOTICES


 


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


 


ARTICLE 13



APPLICABLE LAW


 


Section 13.1.          GOVERNING LAW. THIS MORTGAGE SHALL BE DEEMED TO BE A CONTRACT ENTERED INTO PURSUANT TO
THE LAWS OF THE STATE WHERE THE PROPERTY IS LOCATED AND SHALL IN ALL RESPECTS
BE GOVERNED, CONSTRUED, APPLIED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE
STATE WHERE THE PROPERTY IS LOCATED.


 


Section 13.2.          Usury Laws. Notwithstanding anything to the contrary, (a) all agreements and
communications between Borrower and Lender are hereby and shall automatically
be limited so that, after taking into account all amounts deemed interest, the
interest contracted for, charged or received by Lender shall never exceed the
maximum lawful rate or amount, (b) in calculating whether any interest exceeds
the lawful maximum, all such interest shall be amortized, prorated, allocated
and spread over the full amount and term of all principal indebtedness of
Borrower to Lender, and (c) if through any contingency or event, Lender
receives or is deemed to receive interest in excess of the lawful maximum, any
such excess shall be deemed to have been applied toward payment of the principal
of any and all then outstanding indebtedness of Borrower to Lender, or if there
is no such indebtedness, shall immediately be returned to Borrower.


 


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Section 13.3.          Provisions Subject to Applicable Law. All rights, powers and remedies provided in this
Mortgage may be exercised only to the extent that the exercise thereof does not
violate any applicable provisions of law and are intended to be limited to the
extent necessary so that they will not render this Mortgage invalid,
unenforceable or not entitled to be recorded, registered or filed under the
provisions of any applicable law. If any term of this Mortgage or any
application thereof shall be invalid or unenforceable, the remainder of this
Mortgage and any other application of the term shall not be affected thereby.


 


ARTICLE 14



DEFINITIONS


 


All capitalized terms not
defined herein shall the respective meanings set forth in the Loan Agreement. Unless
the context clearly indicates a contrary intent or unless otherwise
specifically provided herein, words used in this Mortgage may be used
interchangeably in singular or plural form and the word “Borrower”
shall mean “each Borrower and any subsequent owner or owners of the Property or
any part thereof or any interest therein,” the word “Lender”
shall mean “Lender and any subsequent holder of the Note,” the word “Note” shall mean “the Note and any
other evidence of indebtedness secured by this Mortgage,” the word “Property” shall include any portion
of the Property and any interest therein, and the phrases “attorneys’
fees”, “legal fees”
and “counsel fees” shall include any and
all attorneys’, paralegal and law clerk fees and disbursements, including, but
not limited to, fees and disbursements at the pre-trial, trial and appellate
levels incurred or paid by Lender in protecting its interest in the Property,
the Leases and the Rents and enforcing its rights hereunder.


 


ARTICLE 15



MISCELLANEOUS PROVISIONS


 


Section 15.1.          No Oral Change. This Mortgage, and any provisions hereof, may not be modified, amended,
waived, extended, changed, discharged or terminated orally or by any act or
failure to act on the part of Borrower or Lender, but only by an agreement in
writing signed by the party against whom enforcement of any modification,
amendment, waiver, extension, change, discharge or termination is sought.


 


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


 


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


 


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Section 15.4.          Headings, Etc. The headings and captions of various Sections of this Mortgage are for
convenience of reference only and are not to be construed as defining or
limiting, in any way, the scope or intent of the provisions hereof.


 


Section 15.5.          Number and Gender. Whenever the context may require, any pronouns
used herein shall include the corresponding masculine, feminine or neuter
forms, and the singular form of nouns and pronouns shall include the plural and
vice versa.


 


Section 15.6.          Subrogation. If any or all of the proceeds of the Note have been used to extinguish,
extend or renew any indebtedness heretofore existing against the Property,
then, to the extent of the funds so used, Lender shall be subrogated to all of
the rights, claims, liens, titles, and interests existing against the Property
heretofore held by, or in favor of, the holder of such indebtedness and such
former rights, claims, liens, titles, and interests, if any, are not waived but
rather are continued in full force and effect in favor of Lender and are merged
with the lien and security interest created herein as cumulative security for
the repayment of the Debt, the performance and discharge of Borrower’s
obligations hereunder, under the Loan Agreement, the Note and the other Loan
Documents and the performance and discharge of the Other Obligations.


 


Section 15.7.          Entire Agreement. The Note, the Loan Agreement, this Mortgage and the other Loan Documents
constitute the entire understanding and agreement between Borrower and Lender
with respect to the transactions arising in connection with the Debt and
supersede all prior written or oral understandings and agreements between
Borrower and Lender with respect thereto. Borrower hereby acknowledges that,
except as incorporated in writing in the Note, the Loan Agreement, this
Mortgage and the other Loan Documents, there are not, and were not, and no
persons are or were authorized by Lender to make, any representations,
understandings, stipulations, agreements or promises, oral or written, with
respect to the transaction which is the subject of the Note, the Loan
Agreement, this Mortgage and the other Loan Documents.


 


Section 15.8.          Limitation on Lender’s Responsibility. No provision of this Mortgage shall operate to
place any obligation or liability for the control, care, management or repair
of the Property upon Lender, nor shall it operate to make Lender responsible or
liable for any waste committed on the Property by the tenants or any other
Person, or for any dangerous or defective condition of the Property, or for any
negligence in the management, upkeep, repair or control of the Property
resulting in loss or injury or death to any tenant, licensee, employee or
stranger. Nothing herein contained shall be construed as constituting Lender a “mortgagee
in possession.”


 


ARTICLE 16



INTENTIONALLY OMITTED


 


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ARTICLE 17



SPECIAL MASSACHUSETTS PROVISIONS


 


Section 17.1.          The provisions of this Article are intended to
supplement, and not limit, the other provisions of this Security Instrument;
provided, however, that in the event the provisions of this Article expressly
contradict any other provision of this Security Instrument, the provisions of
this Article shall govern.


 


Section 17.2.          This Mortgage is granted
with MORTGAGE COVENANTS and is also upon the STATUTORY CONDITION, for any
breach of which, or for any breach of any other of the covenants, conditions, agreements
and obligations of the Mortgagor herein contained, or upon the occurrence of
any of the events specified as an Event of Default in this Mortgage or if the
whole of the principal sum of and the interest on any of the Note shall become
due, the Mortgagee shall have the STATUTORY POWER OF SALE.


 


[Signature Page to Follow]


 


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


 


	
   

  	
  BORROWER:

  
	
   

  	
   

  
	
   

  	
  INLAND AMERICAN SWAMPSCOTT, L.L.C.,
  a

  
	
   

  	
    Delaware limited liability company

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  INLAND AMERICAN CERUZZI SWAMPSCOTT

  
	
   

  	
   

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

  
	
   

  	
   

  	
  its Sole Member

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  INLAND AMERICAN SWAMPSCOTT MEMBER

  
	
   

  	
   

  	
   

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

  
	
   

  	
   

  	
   

  	
   its Manager

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  INLAND AMERICAN REAL ESTATE

  
	
   

  	
   

  	
   

  	
   

  	
   TRUST, INC., a Maryland
  corporation,

  
	
   

  	
   

  	
   

  	
   

  	
   its Sole Member

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
   

  	
  Title: