POSSESSION, UNDER
SECTION 9-207 OF THE CODE OR OTHERWISE, SHALL BE TO DEAL WITH IT IN THE SAME
MANNER AS THE LENDER DEALS WITH SIMILAR PROPERTY FOR ITS OWN ACCOUNT. NEITHER
THE LENDER NOR ANY OF ITS RESPECTIVE DIRECTORS, OFFICERS, EMPLOYEES, AGENTS OR
ADVISORS SHALL BE LIABLE FOR FAILURE TO DEMAND, COLLECT OR REALIZE UPON ALL OR
ANY PART OF THE COLLATERAL OR FOR ANY DELAY IN DOING SO OR SHALL BE UNDER ANY
OBLIGATION TO SELL OR OTHERWISE DISPOSE OF ANY COLLATERAL UPON THE REQUEST OF
THE GRANTOR OR ANY OTHER PERSON OR TO TAKE ANY OTHER ACTION WHATSOEVER WITH
REGARD TO THE COLLATERAL OR ANY PART THEREOF.
THE POWERS CONFERRED ON THE
LENDER HEREUNDER ARE SOLELY TO PROTECT THE LENDER'S INTERESTS IN THE COLLATERAL
AND SHALL NOT IMPOSE ANY DUTY UPON THE LENDER TO EXERCISE ANY SUCH POWERS.
THE
LENDER SHALL BE ACCOUNTABLE ONLY FOR AMOUNTS THAT IT ACTUALLY RECEIVES AS A
RESULT OF THE EXERCISE OF SUCH POWERS, AND NEITHER THEY NOR ANY OF THEIR
OFFICERS, DIRECTORS, EMPLOYEES, AGENTS OR ADVISORS SHALL BE RESPONSIBLE TO THE
GRANTOR FOR ANY ACT OR FAILURE TO ACT HEREUNDER, EXCEPT FOR THEIR OWN GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT.
11.
POWERS COUPLED WITH AN INTEREST.
ALL
AUTHORIZATIONS AND AGENCIES HEREIN CONTAINED WITH RESPECT TO THE COLLATERAL ARE
IRREVOCABLE AND POWERS COUPLED WITH AN INTEREST.
12.
NOTICES.
NOTICES, REQUESTS AND DEMANDS TO
THE LENDER OR THE GRANTOR SHALL BE DELIVERED TO THE INTENDED RECEIPT AT THE
"ADDRESS FOR NOTICES" SPECIFIED BELOW:
(A)
GRANTOR.
ARC REAL ESTATE HOLDINGS, LLC
600 GRANT ST., STE. 900
DENVER, CO 80203
SCOTT L. GESELL
TELECOPIER NO.: (303) 749-2073
TELEPHONE NO.: (303) 383-7506
8
(B)
LENDER.
MERRILL LYNCH MORTGAGE CAPITAL INC.
4 WORLD FINANCIAL CENTER, 10TH FLOOR
NEW YORK, NEW YORK 10080
ATTENTION: JOSH GREEN
TELECOPIER NO.: (212) 449-6673
TELEPHONE NO.: (212) 449-7330
13.
SEVERABILITY.
ANY PROVISION OF THIS
SECURITY AGREEMENT WHICH IS PROHIBITED OR UNENFORCEABLE IN ANY JURISDICTION
SHALL, AS TO SUCH JURISDICTION, BE INEFFECTIVE TO THE EXTENT OF SUCH PROHIBITION
OR UNENFORCEABILITY WITHOUT INVALIDATING THE REMAINING PROVISIONS HEREOF, AND
ANY SUCH PROHIBITION OR UNENFORCEABILITY IN ANY JURISDICTION SHALL NOT
INVALIDATE OR RENDER UNENFORCEABLE SUCH PROVISION IN ANY OTHER JURISDICTION.
14.
PARAGRAPH HEADINGS.
THE PARAGRAPH HEADINGS
USED IN THIS SECURITY AGREEMENT ARE FOR CONVENIENCE OF REFERENCE ONLY AND ARE
NOT TO AFFECT THE CONSTRUCTION HEREOF OR BE TAKEN INTO CONSIDERATION IN THE
INTERPRETATION HEREOF.
15.
NO WAIVER; CUMULATIVE REMEDIES. THE LENDER
SHALL NOT BY ANY ACT (EXCEPT BY A WRITTEN INSTRUMENT PURSUANT TO SECTION 16
HEREOF), DELAY, INDULGENCE, OMISSION OR OTHERWISE BE DEEMED TO HAVE WAIVED ANY
RIGHT OR REMEDY HEREUNDER OR TO HAVE ACQUIESCED IN ANY DEFAULT OR EVENT OF
DEFAULT OR IN ANY BREACH OF ANY OF THE TERMS AND CONDITIONS HEREOF.
NO FAILURE
TO EXERCISE, NOR ANY DELAY IN EXERCISING, ON THE PART OF THE LENDER, ANY RIGHT,
POWER OR PRIVILEGE HEREUNDER SHALL OPERATE AS A WAIVER THEREOF.
NO SINGLE OR
PARTIAL EXERCISE OF ANY RIGHT, POWER OR PRIVILEGE HEREUNDER SHALL PRECLUDE ANY
OTHER