Document:

exv10w25w4w3a

Exhibit 10.25.4.3a

Schedule of Omitted Mortgage Agreements

(Floating Rate Pools)

The agreements listed below are substantially identical in all material respects to the Mortgage
Security Agreement, Assignment of Rents and Fixture Filing from Ashford Atlantic Beach LP, as
Borrower to Wachovia Bank, National Association, as Lender, dated April 11, 2007, with respect to
Sea Turtle Inn, Atlantic Beach, Florida, filed as Exhibit 10.25.4.3 (the “Form Agreement”), except
as to the parties thereto, the name and legal description of the property, and the title of the
document (to conform to applicable state law and convention). There are no other material
differences between any of the listed documents and the Form Agreement. These agreements are not
being filed as exhibits in reliance on Instruction 2 to Item 601 of Regulation S-K.

	 	•	 	Open-End Mortgage, Security Agreement, Assignment of Rents and Fixture Filing from
Ashford Columbus LP, as Borrower to Wachovia Bank, National Association, as Lender
dated April 11, 2007, with respect to Doubletree Guest Suites, Columbus, Ohio
	 
	 	•	 	Mortgage, Security Agreement, Assignment of Rents and Fixture Filing from Ashford
Coral Gables LP, as Borrower to Wachovia Bank, National Association, as lender dated
April 11, 2007, with respect to Hyatt Regency, Coral Gables, Florida
	 
	 	•	 	Deed to Secure Debt, Security Agreement and Assignment of Rents from Ashford
Kennesaw I LP, as Borrower to Wachovia Bank, National Association, as Lender dated
April 11, 2007, with respect to Fairfield Inn, Kennesaw, Georgia
	 
	 	•	 	Deed to Secure Debt, Security Agreement and Assignment of Rents from Ashford
Kennesaw II LP, as Borrower to Wachovia Bank, National Association, as Lender dated
April 11, 2007, with respect to Springhill Suites, Kennesaw, Georgia
	 
	 	•	 	Deed to Secure Debt, Security Agreement and Assignment of Rents from Ashford
Lawrenceville LP, as Borrower to Wachovia Bank, National Association, as Lender dated
April 11, 2007, with respect to Hampton Inn, Lawrenceville, Georgia
	 
	 	•	 	Mortgage, Security Agreement, Assignment of Rents and Fixture Filing from Ashford
Mobile LP, as Borrower to Wachovia Bank, National Association, as Lender dated April
11, 2007, with respect to Homewood Suites, Mobile, Alabama
	 
	 	•	 	Mortgage, Security Agreement, Assignment of Rents and Fixture Filing from Ashford
Santa Fe LP, as Borrower to Wachovia Bank, National Association, as Lender dated April
11, 2007, with respect to Hilton, Santa Fe, New Mexico

 

 

     
The two agreements listed below (the “Deeds of Trust”) are substantially identical in all
material respects to the Form Agreement, except as to the parties thereto, the name and legal
description of the property, the title of the document (to conform to applicable state law and
convention) and the specific provisions noted below. These agreements are not being filed as
exhibits in reliance on Instruction 2 to Item 601 of Regulation S-K.

	 	•	 	Purchase Money Deed of Trust, Security Agreement, Assignment of Rents and Fixture
Filing from Ashford BWI Airport, LP, as Borrower, to Linda L. Rose, as Trustee and
Wachovia Bank, National Association, as Lender dated April 11, 2007, with respect to
Springhill Suites, BWI Airport, Maryland
	 
	 	•	 	Deed of Trust, Security Agreement, Assignment of Rents and Fixture Filing from
Ashford LV Hughes Center LP, as Borrower to United Title of Nevada, as Trustee and
Wachovia Bank, National Association, as Lender dated April 11, 2007, with respect to
Residence Inn, Las Vegas, Nevada

     The Deeds of Trust include the concept of a trustee, acting for the benefit of the lender, and
each includes the following additional provisions, related to the utilization of a trustee, which
provisions are not included in the Form Agreement:

     Section 18.33. Concerning the Trustee. Trustee shall be under no duty to take any
action hereunder except as expressly required hereunder or by law, or to perform any act which
would: involve Trustee in any expense or liability or to institute or defend any suit in respect
hereof, unless properly indemnified to Trustee’s reasonable satisfaction. Trustee, by acceptance of
this Security Instrument, covenants to perform and fulfill the trusts herein created, being liable,
however, only for gross negligence or willful misconduct,. and hereby waives any statutory fee and
agrees to accept reasonable compensation, in lieu thereof, for any services rendered by Trustee in
accordance with the terms hereof. Trustee may resign at any time by written instrument to that
effect delivered to Lender. Lender may remove Trustee at any time or from time to time and select a
successor trustee. In the event of the death, removal, resignation, refusal to act, or inability to
act of Trustee, or in its sole discretion for any reason whatsoever Lender may, without notice and
without specifying any reasons therefor and without applying to any court, select and appoint a
successor trustee, by an instrument recorded wherever this Security Instrument is recorded, and all
powers, rights, duties and authority of Trustee, as aforesaid, shall thereupon become vested in
such successor. Such substitute trustee shall not be required to give a bond for the faithful
performance of the duties of Trustee hereunder unless required by Lender. The procedure provided
for in this Section 18.33 for substitution of Trustee shall be in addition to and not in exclusion
of any other provisions for substitution, by law or otherwise.

     Section 18.34. Trustee’s Fees. Borrower shall pay all costs, fees and expenses
incurred by Trustee and Trustee’s agents and counsel in. connection with the performance by Trustee
of Trustee’s duties hereunder, and all such costs, fees and expenses shall be secured by this
Security Instrument.

 

 

     This following sections of each of the Deeds of Trust replace, in their entirety, the
identically numbered sections included in the Form Agreement:

     Section 18.37. Intentionally Omitted.

     Section 18.38. Certain Matters Relating to Property Located in the State of
California. With respect to the Property which is located in the State of California,
notwithstanding anything contained herein:

     (a) Power of Sale. Lender may deliver to Trustee a written declaration of an Event of
Default and demand for sale which requests that Trustee record and serve a written notice of
default and of election to cause the Property to be sold, and cause any or all of the Property to
be sold under the power of sale granted by this Security Instrument in the manner herein below
specified in this Section.

     (i) Declaration of Default: Acceptance. Lender shall (1) deliver to Trustee a written
declaration of an Event of Default which recites facts which demonstrate Borrower’s default;
and a demand that Trustee sell the Property, and (2) deposit the Note and this Security
Instrument, if required by law, with Trustee. Trustee shall accept Lender’s declaration of
an Event of Default as true and as demonstrative of Borrower’s default, and shall record and
serve a written notice of default and of election to cause the Property to be sold in the
manner required by applicable law.

     (ii) Rescission of Notice of Default. Lender may rescind any notice of default
at anytime before Trustee’s sale by executing a notice of rescission and recording it. The
recordation of the notice will constitute a cancellation of any prior declaration of an
Event of Default and demand for sale and of any acceleration of maturity of the Debt
affected by any prior declaration or notice of an Event of Default. The exercise by Lender
of the right of rescission will not constitute a waiver of any default then existing or
subsequently occurring, or impair the right of Lender to execute other declarations of
default and demand for sale, or notices of default and of election to cause the Property to
be sold, nor otherwise affect the Note or this Security Instrument, or any of the rights,
obligations or remedies of Lender or Trustee hereunder or under applicable taw.

     (iii) Date of Trustee’s Sale. If, after the expiration of any period of time
provided by applicable law, Borrower’s Event of Default has not been cured and Borrower’s
Debt has not been reinstated in the manner required by applicable law, Trustee shall
establish a date for the sale of the Property and record and serve a notice of sale in the
manner required by applicable law.

     (iv) Trustee’s Sale. If, on or before the date scheduled for the sale of the
Property, Borrower’s Event of Default has not been cured and Borrower’s Debt has not been
reinstated, Trustee, without demand on Borrower, shall sell the Property at the time and
place fixed by Trustee in the notice of sale, either as a whole or in separate. parcels, and
in such order as Trustee may determine, at public auction, and to any Person, including
Borrower, Lender or Trustee. The Property shall be sold to the highest bidder for cash
payable at the time of sale. Notwithstanding the foregoing, instead of paying

 

 

cash for the Property, Lender may credit the amount of its auction sale bid by the
amount of the Debt, or any fraction thereof, including, without limitation, Trustee’s cost
and expenses from the sale of the Property. Lender will be entitled to bid, at any trustee’s
or foreclosure sale of the Property, the amount of the Environmental Damages (as hereinafter
defined), any costs incurred by Lender with respect to any Environmental Problem and
interest in addition to the amount of other Debt as a credit bid, the equivalent of cash.
Furthermore, if a bid has been made by Lender in the amount of the Debt, other than Debt for
Environmental Damages and any costs incurred by Lender with respect to any Environmental
Problem incurred by Lender, any Debt comprised of the Environmental Damages and any costs
incurred by Lender with respect to any Environmental Problem shall not be discharged by
virtue of the full credit bid and shall remain an obligation of Borrower to be satisfied
under this Security Instrument.

     (v) Delivery of Deed. Trustee shall deliver to the purchaser of the Property a
deed which conveys title to the Property without any covenant or warranty, express or
implied. The recitals in the deed of any matters or facts shall be conclusive proof of
their truthfulness.

     (vi) Postponement of Trustee’s Sale. Trustee may postpone the sale of all or
any portion of the Property in accordance with California Civil Code §29248, by public
announcement at the time and place of sale, and from time to time thereafter Trustee may
postpone such sale by public announcement at the time fixed by the preceding postponement or
as otherwise allowed by said statute.

     (vii) Application of Sale Proceeds The proceeds of Trustee’s public auction of
the Property shall be applied in the following manner. (1) payment of the portion of the
Debt attributable to the costs and expenses of the sale; (2) repayment of the portion of the
Debt attributable to any sums expended or advanced by Lender (other than the Environmental
Damages and costs incurred by Lender with respect to any Environmental Problem) under the
terms of this Security Instrument, plus interest at the Default Rate attributable only to
the time during which the Default Rate is charged; (3) payment of all other Debt and all
other obligations of Borrower secured by this Security Instrument, in any order that Lender
chooses; (4) repayment of the portion of the Debt attributable to the Environmental Damages
and costs incurred by Lender with respect to any Environmental Problem under the terms of
this Security Instrument, plus interest at the Default Rate; and (5) the remainder, if any,
to satisfy the outstanding balance of obligations secured by any junior encumbrances in the
order of their priority, then to Borrower or Borrower’s successor in interest

     (viii) Proof of Compliance with the Law. If there is a sale of the Property,
or any part of it, and the execution of a deed for it, the recital of default and of
recording notice of breach and publication of election of sale, and of the elapsing of the
required time between the recording and the following notice, and of the sale should be
made, will be conclusive proof of the default, recording, election, elapsing of time, and
the due giving of notice, and that the sale was regularly and validly made on proper demand
by Lender. Any deed with these recitals will be effectual and conclusive against Borrower,
its successors, and assigns, and all other Persons. The receipt for the purchase money

 

 

recited or in any deed executed to the purchaser will be sufficient discharge to the
purchaser from all obligations to see to the proper application of the purchase money.

     (b) Acceptance by Trustee. Trustee accepts this trust when this Security Instrument,
duly executed and acknowledged, is made a public record as provided by law. Trustee is not
obligated to notify any party hereto of pending sale under any other deed of trust or of any action
or proceeding in which Borrower, Lender or Trustee shall be a party unless brought by Trustee.

     (c) Rights and Duties. It shall be no part of the duty of Trustee to see to any
recording, filing or registration of this Security Instrument or any other instrument in addition
or supplemental hereto, or to give any notice thereof, or to see to the payment of or be under any
duty in respect of any tax or assessment or other governmental charge which may be levied or
assessed on the Property, or any part thereof, or against Trustee, or to see to the performance or
observance by Borrower of any of the covenants and agreements contained herein. Trustee shall not
be responsible for the execution, acknowledgement or validity of this Security Instrument or of any
instrument in addition or supplemental hereto or for the sufficiency of the security purported to
be created hereby, and makes no representation in respect thereof or in respect of the rights of
Lender. Trustee shall have the right to advice of counsel upon any matters arising hereunder and
shall be fully protected in relying as to legal matters on the advice of counsel. Trustee shall not
incur any personal liability hereunder except for its own gross negligence or willful misconduct
and Trustee shall have the right to rely on any instrument, document or signature authorizing or
supporting any action taken or proposed to be taken by Trustee hereunder and believed by Trustee in
good faith to be genuine.

     (d) Subrogation to Existing Liens; Vendor’s Lien. To the extent that proceeds of the
Note are used to pay Debt secured by any outstanding lien, security interest, charge or prior
encumbrance against the Property, such proceeds have been advanced by Lender at Trustee’s request,
and Lender shall be subrogated to any and all rights, security interests and liens owned by any
owner or holder of such outstanding liens, security interests, charges or encumbrances, however
remote, irrespective of whether said liens, security interests, charges or encumbrances are
released, and all of the same are recognized as valid and subsisting and are renewed and continued
and merged herein to secure the Debt, but the terms and provisions of this Security Instrument
shall govern and control the manner and terms of enforcement of the liens, security interests,
charges and encumbrances to which Lender is subrogated hereunder. It is expressly understood that,
in consideration of the payment of such indebtedness by Lender, Borrower hereby waives and releases
all demands and causes of action for offsets and payments in connection with the said indebtedness.
If all or any portion of the proceeds of the Loan or of the Debt has been advanced for the purpose
of paying the purchase price for all or a part of the Property, no vendor’s lien is waived; and
Lender shall have, and is hereby granted, a vendor’s lien on the Property as cumulative additional
security for the secured indebtedness. Lender may foreclose under this Security Instrument or under
the vendor’s lien without waiving the other or may foreclose under both.

     (e) Substitute Trustee. Trustee may resign by an instrument in writing addressed to
Lender, or Trustee may be removed at any time with or without cause by an instrument in writing
executed by Lender. In case of the death, resignation, removal or disqualification of Trustee, or
if

 

 

for any reason Lender shall deem it desirable to appoint a substitute or successor trustee to
act instead of the herein named trustee or any substitute or successor trustee, then Lender shall
have the right and is hereby authorized and empowered to appoint a successor trustee, or a
substitute trustee, without other formality than appointment and designation in writing executed by
Lender, and the authority hereby conferred shall extend to the appointment of other successor and
substitute trustees successively. until the Debt secured hereby has been paid in full, or until the
Property is fully and finally sold hereunder. In the event that the Debt is owned by more than one
person or entity, the holder or holders of not less than a majority in amount of such indebtedness
shall have the right and authority to make the appointment of a successor or substitute trustee as
provided for in the preceding sentence or to remove Trustee as provided in the first sentence of
this Section 18.38(e). Such appointment and designation by Lender, or by the holder or holders of
not less than a majority of the Debt secured hereby, shall be fall evidence of the right and
authority to make the same and of all facts therein recited. If Lender is a corporation or
association or trust and such appointment is executed in its behalf by an officer or trustee of
such corporation or association or trust, such appointment shall be conclusively presumed to be
executed with authority and shall be valid and sufficient without proof of any action by the board
of directors or any superior officer of the corporation or association or trust. Upon the making of
any such appointment and designation, all of the estate and title of Trustee in the Property shall
vest in the named successor or substitute trustee, and it shall thereupon succeed to and shall
hold, possess and execute, all of the rights, powers, privileges, immunities and duties herein
conferred upon Trustee; but, nevertheless, upon the written request of Lender or of the successor
or substitute trustee, the trustee ceasing to act shall execute and deliver an instrument
transferring to such successor or substitute trustee all of the estate and title in the Property of
the trustee so ceasing to act, together with all the rights, powers, privileges, immunities and
duties herein conferred upon the Trustee, and shall duly assign, transfer and deliver any of the
properties and moneys held by said trustee hereunder to said. successor or substitute trustee. All
references herein to “Trustee” shall be deemed to refer to Trustee (including any successor or
substitute appointed and designated as herein provided) from time to time acting hereunder.

     (f) No Liability of Trustee. TRUSTEE SHALL NOT BE LIABLE FOR ANY ERROR OF JUDGMENT OR
ACT DONE BY TRUSTEE IN GOOD FAITH, OR BE OTHERWISE RESPONSIBLE OR ACCOUNTABLE UNDER ANY
CIRCUMSTANCES WHATSOEVER (INCLUDING TRUSTEE’S NEGLIGENCE), EXCEPT FOR TRUSTEE’S GROSS NEGLIGENCE OR
MISCONDUCT. Trustee shall have the right to rely on any instrument, document or signature
authorizing or supporting any action taken or proposed to be taken by it hereunder, believed by it
in good faith to be genuine. All moneys received by Trustee shall, until used or applied as herein
provided, be held in trust for the purposes for which they were received, but need not be
segregated in any manner from any other moneys (except to the extent required by law), and Trustee
shall be under no liability for interest on any moneys received by it hereunder. Trustee hereby
ratifies and confirms any and all acts which the herein-named Trustee or its successor or
successors, substitute or substitutes, in this trust, shall do lawfully by virtue hereof.

     (g) Judgment on Environmental Provision.

     (i) Judgment Sought Pursuant to California Code of Civil Procedure §736, Lender may
bring an action (as such term is defined in California Code of Civil

 

 

Procedure §22) for breach of contract against Borrower for breach of any provision
contained in Article XVI hereof of the type defined as an “environmental provision” under
California Code of Civil Procedure §736 (the “Environmental Provision”), for the
recovery of the Environmental Damages listed in Section (ii) hereof, and for the enforcement
of the Environmental Provision. Notwithstanding the foregoing, no injunction for the
enforcement of an Environmental Provision may be issued after (x) satisfaction of the Debt
or (y) transfer of Borrower’s right, title and interest in and to the “Real Property
Security” (as such tens is defined in California Code of Civil Procedure §736(£)(4)) in a
bona fide transaction to an unaffiliated third parry for fair value.

     (ii) Damages. The damages that Lender may recover pursuant to Section (i) above
shall be limited to reimbursement or indemnification of the following (collectively, the
“Environmental Damages”);: (w) if not pursuant to an order of any Governmental
Authority relating to the cleanup, remediation, or other response action required by any
applicable rule promulgated by a Governmental Authority or applicable law, those casts
relating to a reasonable and good faith cleanup, remediation, or other response action
concerning a Release (notwithstanding anything to the contrary, such term shall have the
meaning ascribed to it under California Civil Code of Procedure §736) or threatened release
of any hazardous substances (as defined in California Civil Code of Procedure §736) which is
anticipated by the Environmental Provision; (x) if pursuant to an order of any Governmental
Authority relating to the cleanup, remediation or other response required by applicable law
which is anticipated by the Environmental Provision, all amounts reasonably advanced in good
faith by Lender in connection therewith, provided that Lender negotiated, or attempted to
negotiate, in good faith to minimize the amounts it was required to advance under the order;
(y) indemnification against all liabilities of Lender to any third party relating to the
breach and not arising from acts, omissions or other conduct which occur after Borrower is
no longer an owner or operator of the “Real Property Security,” and provided Lender is not
responsible for the environmentally impaired condition of the “Real Property Security” in
accordance with the standards set forth in California Code of Civil Procedure §726.5(d) (for
the purposes of this Section (ii), the term “owner or operator” means those persons
described in § 101(20)(A) of CERCLA); and (z) attorneys’ fees and costs incurred by Lender
relating to the breach. Notwithstanding the foregoing, the Environmental Damages recoverable
by Lender shall not include (w) any part of the principal amount or accrued interest of the
Debt, except for any amounts advanced by Lender to cure or mitigate the breach of any
Environmental Provision that is added to the principal amount, and contractual interest
thereon, or (x) amounts which relate to a Release which was knowingly permitted, caused or
contributed to by Lender or any affiliate or agent of Lender.

     (h) Waiver of Lien. Subject to the terms of California Code of Civil Procedure §726.5,
Lender may elect between the following when the “Real Property Security” is “environmentally
impaired” and an Event of Default has occurred and is continuing: (1) (i) waive its lien against
(A) any parcel of “Real Property Security” that is “environmentally impaired” (as such term is
defined in California Code of Civil Procedure §726.5(e)(3)), or is an “affected parcel” (as such
term is defined in California Code Civil Procedure §726.5(e)(1)), and (B) all or any portion of the
personal property attached to such parcels and (ii) exercise (A) the rights and remedies of an
unsecured creditor including reduction of its claim against Borrower to judgment and (B) any

 

 

other rights and remedies permitted by law or (2) exercise (i) the rights and remedies of a
creditor secured by a deed of trust or mortgage, and, if applicable, a lien against fixtures or
personal property attached to the “Real Property Security”, and (ii) any other fights and remedies
permitted by law. As between Lender and Borrower, for purposes of California Code of Civil
Procedure §726.5, Borrower shall have the burden of proving that (1) the Release or threatened
Release was not (x) knowingly or negligently caused or contributed to, or (y) knowingly or
willfully permitted or acquiesced to, by Borrower or any related party (as such term is defined in
California Code of Civil Procedure §726.5(e)(6)), or any affiliate or agent of Borrower or any
related party, and (2) in conjunction with the making, renewal or modification of the Debt, (x)
neither Borrower, any related party nor any affiliate or agent of Borrower or any related parry had
actual knowledge or notice of the Release or threatened Release of any Hazardous Materials, or (y)
if such a person had knowledge or notice of the Release or threatened Release, Borrower made
written disclosure thereof to Lender after Lender’s written request for information concerning the
environmental condition of the Real Property Security, or (z) Lender otherwise obtained actual
knowledge thereof prior to the making, renewal. or modification of the Debt.

     (i) Reconveyance Upon Payment of Debt. In the event that Borrower shall cause to be
paid the entire Debt and perform in full all of its obligations under the Loan Documents, Lender
shall release and shall cause Trustee to release the Property from the lien of this Security
Instrument and to reconvey (without warranty by or recourse against Trustee or Lender) the Property
to Borrower. Upon Trustee’s receipt of Lender’s request for reconveyance; Trustee shall reconvey,
without warranty, the Property or that portion held. When the Property has been fully reconveyed,
the last reconveyance will be deemed to be, and will operate as an assignment and release of all
current and future Rents to the person legally entitled.

     (j) Environmental Addendum.

     (i) Lender shall have the right, but not the obligation, to enter upon the Property,
from time to time upon prior reasonable notice, and in its sole and absolute discretion, to
conduct inspections of the Property and the activities conducted thereon to determine the
compliance with all Environmental Statutes, the presence of Hazardous Materials and the
existence of any potential damages as a result of the condition of the Property. In
furtherance thereof, Borrower hereby grants to Lender and its agents, employees and
qualified consultants and contractors, the right to enter upon the Property and to perform
such tests on the Property (including invasive tests) as are reasonably necessary. Lender
shall conduct such inspections and tests at reasonable times, shall use its best efforts to
minimize interference with the operation of the Property and agrees to restore the condition
of the Property, but Lender shall not be liable for any interference caused thereby unless
due to the gross negligence or willful misconduct or omission. of Lender. In furtherance of
the purposes above, without limitation of any of Lender’s other rights, Lender may: (x)
obtain a court order to enforce Lender’s right to enter and inspect the Property under
California Civil Code §2929.5, to which the decision of Lender as to whether there exists
any Hazardous Materials on or about the Property in violation of any Environmental Statutes,
or a breach by Borrower of any environmental provision of this Security Instrument or any of
the other Loan Documents, will be deemed reasonable and conclusive as between the parties;
and (y) have a receiver be appointed under

 

 

California Code of Civil Procedure §564 to enforce Lender’s right to enter and inspect
the Property for the purpose set forth above.

     (ii) Borrower and Lender agree that. (x) this paragraph is intended as Lender’s written
request for information and Borrower’s written response concerning the environmental
condition of the Property as provided in California Cade of Civil Procedure §726.5; and (y)
each representation, warranty or covenant, or indemnity made by Borrower in this Security
Instrument or in the other Loan Documents that relates to the existence, location, nature,
use, generation, manufacture, storage, disposal, handling, or past, present or future
release (as defined in California Civil Code of Procedure §736(f)(5)), or threatened
release, of any hazardous substance (as defined in California Civil Code of Procedure
§736(1)(3)) into, onto, beneath or from the Property is intended by Borrower and Lender to
he an “environmental provision” for the purposes of California Code of Civil Procedure §736
and will survive the payment of the Debt and the termination or expiration of this Security
Instrument only if Lender acquires any interest in the Property and will not be affected by
Lender’s acquisition of any. interest in the Property, whether by full credit bid at
foreclosure, deed in lieu of that, or otherwise. If there is any transfer of any portion of
Borrower’s interest in the Property, any successor-in-interest to Borrower agrees by its
succession to that interest that the written request made pursuant to this paragraph will be
deemed remade to the successor-in-interest without any further or additional action on the
part of Lender and that by assuming the Debt secured by this Security Instrument or by
accepting the interest of Borrower subject to the lien of this Security Instrument, the
successor remakes each of the representations and warranties in this Security Instrument and
agrees to be bound by each covenant in this Security Instrument, including but not limited
to any indemnity provision.

     (k) Financing Statement This Security Instrument shall also constitute a financing
statement pursuant to UCC §9502, and shall be filed as a fixture filing in the Official Records of
the County Recorder of the Counties in which the Property is located and covers goods which are or
are to become fixtures on the Property.

     (l) Border Zone Property. Borrower represents and warrants that the Property has not
been designated as Border Zone Property under the provisions of California Health and Safety Code
§25220 et seq, or any regulation adopted in accordance therewith and to Borrower’s knowledge there
has been no occurrence or condition on any real property adjoining or in the vicinity of the.
Property that is reasonably likely to cause the Property or any part thereof to be designated as
Border Zone Property.

     (m) Waiver of Statutory Regulation. By initialing below, Borrower waives any right
under California Civil Code §2954.10 or otherwise to prepay the Note, in whole or in part, without
a Prepayment Charge (as described. in Section 13.03 hereof). Borrower acknowledges that prepayment
of the Note may result in Lender’s incurring additional losses, costs, expenses, and liabilities,
including, but not limited to, lost revenue and lost profits. Borrower therefore agrees to pay any
prepayment charges on the terms and conditions provided herein, including, without limitation, upon
arty Event of Default attributable to the transfer or conveyance of any right, title, or interest
in the Property.

 

 

     BORROWER AGREES THAT LENDER’S WILLINGNESS TO MAKE THE LOAN AT THE INTEREST RATE FOR THE TERM
SET FORTH HEREIN CONSTITUTES ADEQUATE CONSIDERATION, GIVEN INDIVIDUAL WEIGHT BY BORROWER, FOR THIS
WAIVER AND AGREEMENT.

     (n) Waivers. All of the following waivers are made only to the extent allowable under
California law.

     (i) Borrower waives all benefits and defenses it may have under California Civil Code
Section 2809 and agrees that Borrower’s liability pursuant to the Loan Documents may be
larger in amount and more burdensome than that of the Cross-collateralized Borrowers.
Borrower’s liability under this Security Instrument shall continue until all sums due under
the Loan Documents have been paid in full and shall not be limited or affected in any way by
any impairment or any diminution or loss of value of any security or collateral for the
obligations under the Loan Documents, from whatever cause, including, without limitation,
Lender’s failure to perfect a security interest in any such security or collateral or any
disability or other defense of the Cross-collateralized Borrowers, any guarantor, other
surety, or any pledgor of collateral for the obligations under the Loan Documents or any
other person related to the Loan Documents.

     (ii) Borrower agrees that its liability under, and the enforceability of, this Security
Instrument are absolute and we not contingent upon the genuineness, validity or
enforceability of the Loan Documents or the availability of any defense to the
Cross-collateralized Borrowers, any guarantor, other surety, other pledgor of collateral for
the obligations under the Loan Documents or any other person related to the obligations
under the Loan Documents. Borrower waives all benefits and defenses it may have under
California Civil Code Section 2810 and agrees that Borrower shall be liable even if the
Cross-collateralized Borrowers, any guarantor, other surety, other pledgor of collateral or
any other person related to the obligations under the Loan Documents had no liability at the
time of execution of the Loan Documents or later ceases to be liable.

     (iii) Borrower waives its rights under California Civil Code Section 2815 and agrees
that by doing so Borrower has no right to revoke this Security Instrument until all
obligations under the Loan Documents have been fully satisfied.

     (iv) Borrower waives its rights under California Civil Code Section 2819 and agrees
that by doing so Borrower’s liability and the enforceability of this Security Instrument
shall continue even if Lender alters any term or obligation under the Loan Documents in any
respect.

     (v) Borrower waives its rights under California Civil Code Section 2839 and agrees that
by doing so (A) its obligations under this Security Instrument shall not be deemed satisfied
by a mere offer of payment by the Cross-collateralized Borrowers, or any other person, of
the principal obligations under the Loan Documents, and (B) Borrower’s liability under and
the enforceability of this Security instrument shall continue until all obligations under
the Loan Documents have been fully satisfied.

 

 

     (vi) Borrower waives all benefits and defenses it may have under California Civil Code
Sections 2845, 2849 and 2850, including, without limitation, the right to require Lender to
(A) proceed against the Cross-collateralized Borrowers, any guarantor, other surety, other
pledgor of collateral for the obligations under the Loan Documents or any other person
related to the obligations under the Loan Documents, (B) proceed against or exhaust any
other security or collateral Lender may hold, or (C) pursue any other right or remedy for
Borrower’s benefit, and agree that Lender may foreclose against all or a part of any
security Lender may hold without taking any action against the Cross-collateralized
Borrowers, any guarantor, other surety, other pledgor of collateral for the obligations
under the Loan Documents or any other person related to the obligations outstanding under
the Loan Documents, and without proceeding. against or exhausting any security or collateral
Lender holds.

     (vii) Borrower waives its rights under California Civil Code Sections 2899 and 3433 and
agrees that by doing so Lender has no obligation regarding the order in which Lender
exercises its remedies against any collateral security encumbered pursuant to any of the
Loan Documents.

     (viii) Borrower waives diligence and all demands, protests, presentments and notices of
every kind or nature, including notices of protest, dishonor, nonpayment, acceptance of this
Security Instrument and creation, renewal, extension, modification or accrual of any of the
obligations under the Loan Documents, Borrower also waives the right to plead all statutes
of limitation as a defense to Borrower’s liability under, or the enforceability of, this
Security Instrument.

     (ix) Borrower waives any rights or benefits it may have by reason of California Code of
Civil Procedure Section 580a which could limit the amount which Lender could recover in a
foreclosure of the Property to the difference between the amount owing under the Loan
Documents and the fair value of the Property or other real property sold at a nonjudicial
foreclosure sale or sales of any other real property held by Lender as security for the
obligations under the Loan Documents.

     (x) Borrower waives all rights and defenses arising out of an election of remedies by
Lender, even though that election of remedies, such as a nonjudicial foreclosure of the
Property or any other real property given to secure the obligations under the Loan
Documents, destroys Borrower’s rights of subrogation and reimbursement against the
Cross-collateralized Borrowers by the operation of Section 580d of the California Code of
Civil Procedure or otherwise.

     (o) Borrower Informed of the Cross-collateralized Borrowers’ Condition. Borrower
acknowledges that it has had an opportunity to review the Loan Documents, the value of the security
for the obligations under the Loan Documents and the other Cross-collateralized Borrowers’
financial condition and ability to satisfy the obligations under the Loan Documents to which any o£
the-other Cross-collateralized Borrowers is a party. Borrower agrees to keep itself fully informed
of all aspects of the other Cross-collateralized Borrowers’ financial condition and the performance
of the other Cross-collateralized Borrowers’ obligations to Lender and that Lender has no duty to
disclose to Borrower any information pertaining to the

 

 

other Cross-collateralized Borrowers or any security for the obligations under the Loan
Documents.

     (p) Subrogation, Reimbursement and Contribution Rights. Borrower agrees that its
rights of subrogation and reimbursement against the other Cross-collateralized Borrowers, their
rights of subrogation against any other collateral or security for the obligations under the Loan
Documents or the pledgor of such collateral or security and its rights of contribution from any
guarantor, other surety or other pledgor of collateral shall be subordinate to Lender’s rights
against the other Cross-collateralized Borrowers, in such collateral or security and against any
such guarantor, surety or pledgor. Borrower shall have no such rights of subrogation, reimbursement
or contribution until all amounts due under the Loan Documents have been paid in full and Lender
has released, transferred or disposed of all of its rights in any collateral or security. To the
extent allowable under California. laws, Borrower waives its rights under California Civil Code
Sections 2847, 2848 and 28.49 to the extern inconsistent with the foregoing.

     (q) Confirmation of Waivers: the Cross-collateralized Borrowers’ Obligations are
Secured by Real Property. The following waivers are made only to the extent allowable under
California law.

     (i) Borrower waives all rights and defenses that Borrower may have because the
Cross-collateralized Borrowers’ obligations are secured by real property. This means, among
other things:

     (A) Lender may collect from Borrower without first foreclosing on any real or
personal property collateral for the Cross-collateralized Borrowers’ obligations
pledged by the Crass-collateralized Borrowers or any other person; and

     (B) if Lender forecloses on any real property collateral pledged by the
Cross-collateralized Borrowers or any other person:

     (1) the amount of the Cross-collateralized Borrowers’ obligations outstanding
may be reduced only by the price for which the real property collateral is sold at
the foreclosure sale, even if the real property collateral is worth more than the
sale price; and

     (2) Lender may collect from Borrower even if Lender, by foreclosing on the real
property collateral, has destroyed any right Borrower may have to collect from the
Cross-collateralized Borrowers.

     (ii) These are unconditional and irrevocable waivers of any rights and defenses
Borrower may have because the Cross-collateralized Borrowers’ debt is secured by real
property. These rights and defenses include, but are not limited to, any rights or defenses
based upon Section 580a, 580b, 580d or 726 of the California Code of Civil Procedure.

 

 

     (r) Fixture Filing. The personal property in which Lender has a security interest
includes goods which are or shall become fixtures on the Property. This Security Instrument is
intended to serve as a fixture filing pursuant to the terms of the California Uniform Commercial
Code. This filing shall remain in effect as a fixture filing until this Security Instrument is
released or otherwise satisfied of record or its effectiveness otherwise terminates with respect to
the Property. In that regard, the following information is provided:

	 	 	 
	Name of Debtor:

	 	The name of “Borrower” as set forth on signature page
	 
	 	 
	Address of Debtor:

	 	See Section 11.01 above.
	 
	 	 
	Name of Secured Party:

	 	Wachovia Bank, National Association
	 
	 	 
	Address of Secured Party:

	 	See Section 11.01 above.

     Section 18.39. Certain Matters Relating to the Premises Located in the State of
Maryland. With respect to the property which is located in the State of Maryland,
notwithstanding anything contained herein to the contrary:

     (a) Until an Event of Default in payment of any matter of indebtedness hereby secured as
herein provided for, or until breach of any of the covenants, agreements, terms or conditions
contained herein or contained in the Note or other Loan Documents to permit Borrower to possess and
enjoy said Property and to receive the rents, issues and profits thereof; and on full payment of
said Note, and of any extensions or renewals thereof, and interest thereon, and all sums advanced
or expended as herein provided, and all other proper costs, charges, expenses, commissions, at any
time before the sale hereinafter provided for, to release and reconvey unto and at the cost of
Borrower, or the patty or parties than claiming under it, the aforesaid Property.

     (b) Upon the occurrence of an Event of Default:

     (i) Borrower, in accordance with Section 7-105 of the Real Property Article of the
Annotated Code of Maryland, as amended, Rule 14201 et. seq. of the Maryland Rules of
Procedure or any public general law or public local law of the State of Maryland relating to
deeds of trust or mortgages, including any supplements, amendments or additions thereto,
does hereby assent to the passage of a decree for the sale of the Property by the Circuit
Court for the County in which the Premises is located; or

     (ii) Borrower agrees that Trustee or substitute trustee, at the option of Lender, shall
take possession of the Property and/or shall have the power and duty to sell and, in the
event of default by any purchaser, to re-sell all or any part of the Premises at public
auction.

     (c) Upon any such sale, whether made under the assent to the passing of a decree or under the
power of sale, the party selling may sell the Property as a whole, in such parcel or parcels,
manner or order as said party selling may, in his sole discretion, elect; such sale may also be at
the sole discretion of the party selling, subject to any one or more existing tenancies entered
into subsequent to the recordation of this Security Instrument, in accordance with

 

 

Section 7-105(f)(2) of the Real Property Article of the Annotated Code of Maryland, as
amended. Such sale shall be at public auction, at such time and place, upon such terms and
conditions, and after notice to Borrower and such previous public notice (in compliance with the
Maryland Rules of procedure) as the Trustee, or substitute trustee, shall deem best for the
interest of all parties concerned, and (the terms of the sale being complied with) shall deliver to
the purchaser or purchasers (at the cost of such purchaser or purchasers) a trustee’s deed
conveying the Property so sold without any covenant or warranty, expressed or implied, such
purchaser being hereby discharged from all liability for the application of the purchase of the
purchase money; and shall apply the proceeds of sale in the following order: (i) to all expenses of
sale of every kind and nature whatsoever, including, without limitation, reasonable attorneys’
fees, all taxes and assessments thereon due, all insurance premiums and fees for guard or watchmen
services, all utility charges of whatsoever nature whether or not listed on the real property tax
bill, all sums advanced as herein provided, and a trustees’ commission equal to the commission
allowed trustees for making sales of property under decrees of the equity courts having
jurisdiction, (ii) to the payment of the indebtedness due and outstanding under the Note, whether
manned or not, and the interest thereon to date of payment from purchaser, and (iii) to the said
Borrower, its successors or assigns, upon the surrender and delivery to the purchaser or to their
heirs, personal representatives, successors or assigns of purchaser, of the possession of the
Property so sold and conveyed, the surplus (if any) less the expenses (if any) of obtaining
possession thereof In the event that the Debt is paid after the first insertion of an advertisement
of sale of the Property, but prior to the sale thereof, half of such commissions and all such
expenses and costs shall be paid by Borrower, its heirs, successors or assigns.

     (d) In addition, Borrower agrees that Lender may,. upon the occurrence of an Event of Default,
proceed under the Uniform Commercial Code as presently contained in the Commercial Law Article of
the Annotated Code of Maryland and any and all amendments, additions and supplements thereto, as to
all or any part of the chattels, personal property, equipment and fixtures aforesaid, all the
rights, remedies and power of a secured parry under the Uniform Commercial Code including, without
limitation, the right and power to replevy, sell or otherwise dispose of, foreclose upon, lease or
utilize all or any part of such chattels, personal property, equipment and fixtures aforesaid in
any manner authorized or permitted under said Uniform Commercial Code.

     (e) Lender may from time to time, without notice to Borrower and with or without cause,
substitute a successor or successors to any Trustee named herein or acting hereunder. Upon such
appointment, and without conveyance to the successor trustee, the latter shall be vested with all
title, powers and duties conferred upon any Trustee herein named or acting hereunder. Each such
appointment and substitution shall be made by written Deed of appointment executed by Lender
containing reference to this Security Instrument and its place of record which, when duly recorded
among the Land Records of the county or city in which the Premises are situated, shall be
conclusive proof of proper appointment of the successor trustee. The procedure herein provided for
substitution of trustees shall not be exclusive of all other provisions for substitution, statutory
or otherwise.

     (f) In the event that two or more trustees are named herein, any one or more of the trustees
shall be clothed with full power to act when action hereunder is required; in the event that two or
more trustees are named herein and the substitution of a trustee shall become

 

 

necessary for any reason, the substitution of one or more trustees in the place of the two or
more named herein shall be sufficient.

     (g) The Trustee may act hereunder and may sell and convey the Premises under power granted by
this instrument, although the Trustee has been, may now be and may hereafter be an attorney or
agent of the holder of the Note secured hereby. The holder of the Note secured hereby may bid and
become the purchaser at any sale under this Security Instrument.

     (h) Borrower expressly represents and warrants that the loan secured by this Security
Instrument is a Commercial Loan within the meaning of Section 12-101(c) and 12-103(c) of the
Commercial Law Article of the Annotated Code of Maryland, and Borrower further warrants that all
loan proceeds will be used for said business or commercial investment purpose.

     (i) Fixture Filing and Financing Statements. This Security constitutes a security
agreement, fixture filing and financing statement as those terms are used in the UCC. This Security
Instrument is to be filed and recorded in, among other places, the real estate records of the
County in which the Premises is located and the following information is included: (1) the Borrower
shall be deemed. the “Debtor” with the address set forth for the Borrower in the introductory
paragraph of this Deed of Trust; (2) the Lender shall be deemed to be the “Secured Party” with the
address set forth for the Lender in the introductory paragraph of this Security Instrument and
shall have all of the rights of a secured party under the UCC; (3) this Security Instrument covers
goods which are or are to become fixtures; (4) the name of the record owner of the land is the
Borrower; (5) the organizational identification number of the Borrower is as set forth on the
signature page hereof; (6) the Borrower is a limited partnership or a limited liability company, as
applicable, organized under the laws of the State of Delaware; and (7) the legal name of Borrower
is as set forth on the signature page hereof, and Borrower is not known by any other name(s).
Borrower hereby authorizes Lender to file any financing statements and terminations thereof or
amendments or modifications thereto without the signature of Borrower where permitted by law.

     Section 18.40. Certain Matters Relating to Property Located in Missouri. With
respect to the Property located in the State of Missouri, notwithstanding anything contained herein
to the contrary:

     (a) FUTURE ADVANCES ARE SECURED HEREBY PURSUANT TO SECTION 443.055 OF THE REVISED STATUTES OF
MISSOURI.

     (b) In the event any foreclosure advertisement is running or has run at the time of such
appointment of a successor Trustee, the successor Trustee may, to the extent permitted by
applicable law, consummate the advertised sale without the necessity of republishing such
advertisement.

     (c) Upon the occurrence of an Event of Default, the Trustee shall, at the request of Lender,
proceed to sell the Property as one parcel in its entirety or any part thereof, either in mass or
in parcels, at the absolute discretion of Trustee, at public venue, to the highest bidder for cash
at the door of the Court House or other location then customarily employed for that purpose in the
county (or city) where the Property is located, first giving notice of the time and

 

 

place of sale, and a description of the property to be sold, by advertisement published and as
is provided by the laws of the State of Missouri then in effect, and upon sale shall execute and
deliver a deed of conveyance of the property sold to the purchaser or purchasers thereof, and any
statement or recital of fact in such deed, in relation to the non-payment of the money hereby
secured to be paid, existence of the indebtedness so secured, notice of advertisement, sale and
receipt of the proceeds of sale, shall be presumptive evidence of the truth of such statements or
recital. The power of sale hereunder shall not be exhausted by any one or more such sales (or
attempts to sell) as to all or any portion of the Property remaining unsold, but shall continue
unimpaired until all of the Property has been sold or the Note and all other indebtedness of
Borrower to Lender secured hereby shall have been paid in full.

     (d) The Trustee may sell and convey the Property under the power aforesaid, although the
Trustee has been, may now be or may hereafter be attorney or agent of the Lender in respect to the
loan made by Lender evidenced by the Note or this Security Instrument or in respect to any matter
of business whatsoever:

     (e) The Trustee hereby lets the Property to the Borrower until a sale be had under the
foregoing provisions, upon the following terms and conditions, such letting being to-wit: The
Borrower and every and all persons claiming or possessing the Property, or any part thereof, by,
through or under Borrower shall pay. rent therefor during said term at the rate of one cent (1¢)
per month, payable monthly upon demand, and shall surrender immediate peaceable possession of said
premises, to the purchaser thereof, under such sale, without notice or demand therefor. Should
possession not be surrendered as provided for herein the purchaser. shall be entitled to institute
proceedings for possession as aforesaid.

     (f) The following is added pursuant to Section 432.047 of the Missouri Revised Statutes. As
used below “borrower(s)” shall mean Borrower and “creditor” shall mean Lender:

     ORAL AGREEMENTS OR COMMITMENTS TO LOAN MONEY, EXTEND CREDIT OR TO FORBEAR FROM ENFORCING
REPAYMENT OF A DEBT INCLUDING PROMISES TO EXTEND OR RENEW SUCH DEBT ARE NOT ENFORCEABLE, REGARDLESS
OF THE LEGAL THEORY UPON WHICH IT IS BASED THAT IS IN ANYWAY RELATED TO THE LOAN. TO PROTECT YOU
(BORROWER) AND US (LENDER) FROM MISUNDERSTANDING OR DISAPPOINTMENT, ANY AGREEMENTS WE REACH
COVERING SUCH MATTERS ARE CONTAINED IN THIS WRITING, WHICH IS THE COMPLETE AND EXCLUSIVE STATEMENT
OF THE AGREEMENT BETWEEN US, EXCEPT AS WE MAY LATER AGREE IN WRITING TO MODIFY IT.

     (g) In the event any person legally entitled thereto shall at any time deliver or cause to be
delivered to the Lender a notice pursuant to subsection 6 or 8 of Section 443.055 of the Missouri
Revised Statutes electing to terminate the operation of this Security Instrument as security for
future advances or future obligations made or incurred after the date of such notice, then upon
receipt of such notice Lender shall have no further obligation under the Note, this Security
Instrument or otherwise to advance monies to or for the account of Borrower, notwithstanding
anything in the Note or this Security Instrument to the contrary. Moreover, any request by Borrower
for an advance under the Note or hereunder shall constitute a certification that no such notice of
lien termination has been given.

 

 

     (h) The following notice is provided pursuant to Section 427.120 of the Missouri Revised
Statutes. As used herein, the terms “you” and “your” shall refer to Borrower, and the terms “we”
and “us” shall refer to Lender,

     UNLESS YOU PROVIDE EVIDENCE OF THE INSURANCE COVERAGE REQUIRED BY YOUR AGREEMENT WITH US, WE
MAY PURCHASE INSURANCE AT YOUR EXPENSE TO PROTECT OUR INTERESTS IN YOUR COLLATERAL. THIS INSURANCE
MAY, BUT NEED NOT, PROTECT YOUR INTERESTS IN YOUR COLLATERAL. THIS INSURANCE MAY, BUT NEED NOT,
PROTECT YOUR INTERESTS. THE COVERAGE THAT WE PURCHASE MAY NOT PAY ANY CLAIM THAT YOU MAKE OR ANY
CLAIM THAT IS MADE AGAINST YOU IN CONNECTION WITH THE COLLATERAL. YOU MAY LATER CANCEL ANY
INSURANCE PURCHASED BY US, BUT ONLY AFTER PROVIDING EVIDENCE THAT YOU HAVE OBTAINED INSURANCE AS
REQUIRED BY OUR AGREEMENT. IF WE PURCHASE INSURANCE FOR THE COLLATERAL, YOU WILL BE RESPONSIBLE FOR
THE COSTS OF THAT INSURANCE, INCLUDING THE INSURANCE PREMIUM, INTEREST AND ANY OTHER CHARGES WE MAY
IMPOSE IN CONNECTION WITH THE PLACEMENT OF THE INSURANCE, UNTIL THE EFFECTIVE DATE OF THE
CANCELLATION OR EXPIRATION OF THE INSURANCE. THE COSTS OF THE INSURANCE MAY BE ADDED TO YOUR TOTAL
OUTSTANDING BALANCE OR OBLIGATION. THE COSTS OF THE INSURANCE MAY BE MORE THAN THE COST OF
INSURANCE YOU MAY BE ABLE TO OBTAIN ON YOUR OWN.

     (i) This Security Instrument is effective as a financing statement filed as a fixture filing
under Sections 9-313 and 9-402 of the Uniform Commercial Code, as amended or recodified from time
to time, covering any of the Fixtures which now is or later may become fixtures attached to the
Premises. The addresses set forth in Section 110 1 hereof are the mailing address of Borrower, as
debtor under the Uniform Commercial Code, and Lender, as secured party under the Uniform Commercial
Code, respectively and the organizational identification number of Borrower is set forth on the
signature page hereof. The fixture collateral relates to the real property described on Exhibit A
of which Borrower is the record owner.

     Section 18.41. Intentionally Omitted.

     Section 18.42. Intentionally Omitted.

     Section 18.43. Intentionally Omitted.

     Section 18.44. Intentionally Omitted.

     Each of the Deeds of Trust ends with Section 18.44, omitting, in their entirety, Sections
18.45 and 18.46 included in the Form Agreement.exv10w25w4w4

Exhibit 10.25.4.4

Ashford

(Pool 1)

 

ASHFORD EDISON LP,

as Borrower

to

WACHOVIA BANK, NATIONAL ASSOCIATION,

as Lender

MORTGAGE, SECURITY AGREEMENT, ASSIGNMENT OF RENTS

AND FIXTURE FILING

 

Dated: April 11, 2007

PREPARED BY AND UPON RECORDATION RETURN TO:

Proskauer Rose llp

1585 Broadway

New York, New York 10036

Attention: David J. Weinberger, Esq.

 

 

 

     THIS MORTGAGE, SECURITY AGREEMENT, ASSIGNMENT OF RENTS AND FIXTURE FILING (the “Security
Instrument”) is made as of the 11th day of April, 2007, by the party set forth as Borrower on
the signature page hereof, having their chief executive office at 14185 Dallas Parkway, Suite 1100,
Dallas, Texas 75254-4308 (hereinafter referred to as “Borrower”), to WACHOVIA BANK,
NATIONAL ASSOCIATION, having an address at Wachovia Bank, National Association, Commercial Real
Estate Services, 8739 Research Drive URP 4, NC 1075, Charlotte, North Carolina 28262 (hereinafter
referred to as “Lender”).

W I T N E S S E T H:

     WHEREAS, Lender has authorized a loan (hereinafter referred to as the “Loan”) to the
Cross-collateralized Borrowers in the maximum principal sum of ONE HUNDRED THREE MILLION NINE
HUNDRED SIX THOUSAND and NO/100 DOLLARS ($103,906,000.00) (hereinafter referred to as the “Loan
Amount”), which Loan is evidenced by that certain promissory note, dated the date hereof
(together with any supplements, amendments, modifications or extensions thereof, hereinafter
referred to as the “Note”) given by the Cross-collateralized Borrowers, as maker, to
Lender, as payee;

     WHEREAS, in consideration of the Loan, the Cross-collateralized Borrowers have agreed to make
payments in amounts sufficient to pay and redeem, and provide for the payment and redemption of the
principal of, premium, if any, and interest on the Note when due;

     WHEREAS, Borrower desires by this Security Instrument to provide for, among other things, the
issuance of the Note and for the deposit, deed and pledge by Borrower with, and the creation of a
security interest in favor of, Lender, as security for the Cross-collateralized Borrowers’
obligations to Lender from time to time pursuant to the Note and the other Loan Documents;

     WHEREAS, Borrower and Lender intend these recitals to be a material part of this Security
Instrument; and

     WHEREAS, all things necessary to make this Security Instrument the valid and legally binding
obligation of Borrower in accordance with its terms, for the uses and purposes herein set forth,
have been done and performed.

     NOW THEREFORE, to secure the payment of the principal of, prepayment premium (if any) and
interest on the Note and all other obligations, liabilities or sums due or to become due under this
Security Instrument, the Note or any other Loan Documents, including, without limitation, interest
on said obligations, liabilities or sums (said principal, premium, interest and other sums being
hereinafter referred to as the “Debt”), and the performance of all other covenants,
obligations and liabilities of the Cross-collateralized Borrowers pursuant to the Loan Documents,
Borrower has executed and delivered this Security Instrument; and Borrower has irrevocably granted,
and by these presents and by the execution and delivery hereof does hereby irrevocably grant,
bargain, sell, alien, demise, release, convey, assign, transfer, deed, hypothecate, pledge, set
over, warrant, mortgage and confirm to Lender, forever with power of sale, all right, title and
interest of Borrower in and to all of the following property, rights, interests and estates:

     (a) the plot(s), piece(s) or parcel(s) of real property described in Exhibit A attached hereto
and made a part hereof (individually and collectively, hereinafter referred to as the
“Premises”);

     (b) (i) all buildings, foundations, structures, fixtures, additions, enlargements, extensions,
modifications, repairs, replacements and improvements of every kind or nature now or hereafter
located on the Premises (hereinafter collectively referred to as the “Improvements”); and
(ii) to the extent permitted by law and the Management Agreement, the Franchise Agreement, the name
or names, if any, as may now or hereafter be used for any of the Improvements, and the goodwill
associated therewith;

     (c) all easements, servitudes, rights-of-way, strips and gores of land, streets, ways, alleys,
passages, sewer rights, water, water courses, water rights and powers, ditches, ditch rights,
reservoirs and reservoir rights, air rights and development rights, lateral support, drainage, gas,
oil and mineral rights, tenements, hereditaments and appurtenances of any nature whatsoever, in any
way belonging, relating or pertaining to the Premises or the Improvements and the reversion and
reversions, remainder and remainders, whether existing or hereafter acquired,

 

 

and all land lying in the bed of any street, road or avenue, opened or proposed, in front of
or adjoining the Premises to the center line thereof and any and all sidewalks, drives, curbs,
passageways, streets, spaces and alleys adjacent to or used in connection with the Premises and/or
Improvements and all the estates, rights, titles, interests, property, possession, claim and demand
whatsoever, both in law and in equity, of Borrower of, in and to the Premises and Improvements and
every part and parcel thereof, with the appurtenances thereto;

     (d) all machinery, equipment, systems, fittings, apparatus, appliances, furniture,
furnishings, tools, fixtures, Inventory (as hereinafter defined) and articles of personal property
and accessions thereof and renewals, replacements thereof and substitutions therefor (including,
but not limited to, all plumbing, lighting and elevator fixtures, office furniture, beds, bureaus,
chiffonniers, chests, chairs, desks, lamps, mirrors, bookcases, tables, rugs, carpeting, drapes,
draperies, curtains, shades, venetian blinds, wall coverings, screens, paintings, hangings,
pictures, divans, couches, luggage carts, luggage racks, stools, sofas, chinaware, flatware,
linens, pillows, blankets, glassware, foodcarts, cookware, dry cleaning facilities, dining room
wagons, keys or other entry systems, bars, bar fixtures, liquor and other drink dispensers,
icemakers, radios, television sets, intercom and paging equipment, electric and electronic
equipment, dictating equipment, telephone systems, computerized accounting systems, engineering
equipment, vehicles, medical equipment, potted plants, heating, lighting and plumbing fixtures,
fire prevention and extinguishing apparatus, theft prevention equipment, cooling and
air-conditioning systems, elevators, escalators, fittings, plants, apparatus, stoves, ranges,
refrigerators, laundry machines, tools, machinery, engines, dynamos, motors, boilers, incinerators,
switchboards, conduits, compressors, vacuum cleaning systems, floor cleaning, waxing and polishing
equipment, call systems, brackets, signs, bulbs, bells, ash and fuel, conveyors, cabinets, lockers,
shelving, spotlighting equipment, dishwashers, garbage disposals, washers and dryers), other
customary hotel equipment, inventory and other property of every kind and nature whatsoever owned
by Borrower, or in which Borrower has or shall have an interest, now or hereafter located upon, or
in, or used in connection with the Premises or the Improvements, or appurtenant thereto, and all
building equipment, materials and supplies of any nature whatsoever owned by Borrower, or in which
Borrower has or shall have an interest, now or hereafter located upon, or in, or used in connection
with the Premises or the Improvements or appurtenant thereto, (hereinafter, all of the foregoing
items described in this paragraph (d) are collectively called the “Equipment”), all of
which, and any replacements, modifications, alterations and additions thereto, to the extent
permitted by applicable law, shall be deemed to constitute fixtures (the “Fixtures”), and
are part of the real estate and security for the payment of the Debt and the performance of
Borrower’s obligations. To the extent any portion of the Equipment is not real property or
fixtures under applicable law, it shall be deemed to be personal property, and this Security
Instrument shall constitute a security agreement creating a security interest therein in favor of
Lender under the UCC;

     (e) all awards or payments, including interest thereon, which may hereafter be made with
respect to the Premises, the Improvements, the Fixtures, or the Equipment, 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 said right), or for a change of grade, or for any other
injury to or decrease in the value of the Premises, the Improvements or the Equipment or refunds
with respect to the payment of property taxes and assessments, and all other proceeds of the
conversion, voluntary or involuntary, of the Premises, Improvements, Equipment, Fixtures or any
other Property or part thereof into cash or liquidated claims;

     (f) all leases, tenancies, franchises (to the extent not prohibited in the Franchise
Agreement), licenses and permits, Property Agreements and other agreements affecting the use,
enjoyment or occupancy of the Premises, the Improvements, the Fixtures, or the Equipment or any
portion thereof now or hereafter entered into, whether before or after the filing by or against
Borrower of any petition for relief under the Bankruptcy Code and all reciprocal easement
agreements, license agreements and other agreements, including, without limitation the existing
Operating Lease (hereinafter collectively referred to as the “Leases”), together with all
receivables, revenues, rentals, credit card receipts, receipts and all payments received which
relate to the rental, lease, franchise and use of space at the Premises and rental and use of guest
rooms or meeting rooms or banquet rooms or recreational facilities or bars, beverage or food sales,
vending machines, mini-bars, room service, telephone, video and television systems, electronic
mail, internet connections, guest laundry, bars, the provision or sale of other goods and services,
and all other payments received from guests or visitors of the Premises, and other items of
revenue, receipts or income as identified in the Uniform System of Accounts (as hereinafter
defined), all cash or security deposits, lease termination payments, advance rentals and payments
of similar nature and guarantees or other security held by, or issued in favor of, Borrower in
connection therewith to the extent of Borrower’s right or interest therein and all

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remainders, reversions and other rights and estates appurtenant thereto, and all base, fixed,
percentage or additional rents, and other rents, oil and gas or other mineral royalties, and
bonuses, issues, profits and rebates and refunds or other payments made by any Governmental
Authority from or relating to the Premises, the Improvements, the Fixtures or the Equipment plus
all rents, common area charges and other payments now existing or hereafter arising, whether paid
or accruing before or after the filing by or against Borrower of any petition for relief under the
Bankruptcy Code (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;

     (g) all proceeds of and any unearned premiums on any insurance policies covering the Premises,
the Improvements, the Fixtures, the Rents or the Equipment, 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 Premises, the Improvements, the Fixtures or the Equipment and all
refunds or rebates of Impositions, and interest paid or payable with respect thereto;

     (h) all deposit accounts, securities accounts, funds or other accounts maintained or deposited
with Lender, or its assigns, in connection herewith, including, without limitation, the Escrow
Accounts, the Central Account, the Collection Account, and the Sub-Accounts and all monies and
investments deposited or to be deposited in such accounts;

     (i) all accounts receivable, contract rights, franchises (to the extent not prohibited in the
Franchise Agreement), interests, estate or other claims, both at law and in equity, now existing or
hereafter arising, and relating to the Premises, the Improvements, the Fixtures or the Equipment,
not included in Rents;

     (j) all now existing or hereafter arising claims against any Person with respect to any damage
to the Premises, the Improvements, the Fixtures or the Equipment, including, without limitation,
damage arising from any defect in or with respect to the design or construction of the
Improvements, the Fixtures or the Equipment and any damage resulting therefrom;

     (k) all deposits or other security or advance payments, including rental payments now or
hereafter made by or on behalf of Borrower to others, with respect to (i) insurance policies, (ii)
utility services, (iii) cleaning, maintenance, repair or similar services, (iv) refuse removal or
sewer service, (v) parking or similar services or rights and (vi) rental of Equipment, if any,
relating to or otherwise used in the operation of the Premises, the Improvements, the Fixtures or
the Equipment;

     (l) all intangible property (to the extent assignable) now or hereafter relating to the
Premises, the Improvements, the Fixtures or the Equipment or its operation, including, without
limitation, software, letter of credit rights, trade names, trademarks (including, without
limitation, any licenses of or agreements to license trade names or trademarks now or hereafter
entered into by Borrower), logos, building names and goodwill;

     (m) all now existing or hereafter arising advertising material, guaranties, warranties,
building permits, other permits, licenses, plans and specifications, shop and working drawings,
soil tests, appraisals and other documents, materials and/or personal property of any kind now or
hereafter existing in or relating to the Premises, the Improvements, the Fixtures, and the
Equipment;

     (n) all now existing or hereafter arising drawings, designs, plans and specifications prepared
by architects, engineers, interior designers, landscape designers and any other consultants or
professionals for the design, development, construction, repair and/or improvement of the Property,
as amended from time to time;

     (o) the right, in the name of and on behalf of Borrower, to appear in and defend any now
existing or hereafter arising action or proceeding brought with respect to the Premises, the
Improvements, the Fixtures or the Equipment and to commence any action or proceeding to protect the
interest of Lender in the Premises, the Improvements, the Fixtures or the Equipment;

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     (p) in the event Borrower is a tenancy-in-common, all rights of TICs under the TIC Agreement
including, without limitation, any rights of first refusal, options to purchase and similar rights
and any rights of first refusal arising under Section 363(i) of the Bankruptcy Code; and

     (q) all proceeds, products, substitutions and accessions (including claims and demands
therefor) of each of the foregoing.

     All of the foregoing items (a) through (q), together with all of the right, title and interest
of Borrower therein, are collectively referred to as the “Property”.

     TO HAVE AND TO HOLD the above granted and described Property unto Lender, and the successors
and assigns of Lender in fee simple, forever.

     PROVIDED, ALWAYS, and these presents are upon this express condition, if Borrower shall well
and truly pay and discharge the Debt and perform and observe the terms, covenants and conditions
set forth in the Loan Documents, then these presents and the estate hereby granted shall cease and
be void.

     AND Borrower covenants with and warrants to Lender that:

ARTICLE I: DEFINITIONS

     Section 1.01. Certain Definitions.

     For all purposes of this Security Instrument, except as otherwise expressly provided or unless
the context clearly indicates a contrary intent:

     (i) the capitalized terms defined in this Section have the meanings assigned to them in
this Section, and include the plural as well as the singular;

     (ii) all accounting terms not otherwise defined herein have the meanings assigned to
them in accordance with GAAP; and

     (iii) the words “herein”, “hereof”, and “hereunder” and other words of similar import
refer to this Security Instrument as a whole and not to any particular Section or other
subdivision.

     “Adjusted Net Cash Flow” shall mean Net Operating Income for the twelve (12)-month
period prior to the date of calculation less, without duplication, (a) the Recurring Replacement
Reserve Monthly Installment (assuming for purposes of this definition that the definition of
Recurring Replacement Reserve Monthly Installment only includes the first sentence thereof)
multiplied by twelve (12) and (b) extraordinary capital improvements projected by Lender, in its
reasonable discretion, for the subsequent twelve (12) month period for which sums were not
deposited into the Recurring Replacement Reserve Escrow Account. The Adjusted Net Cash Flow shall
be calculated by Borrower and shall be subject to the reasonable review and approval of Lender.

     “Affiliate” of any specified Person shall mean any other Person directly or indirectly
Controlling or Controlled by or under direct or indirect common Control with such specified Person.

     “Aggregate Debt Service Coverage” shall mean the quotient obtained by dividing the
aggregate Adjusted Net Cash Flow for all of the Cross-collateralized Properties for a specified
period by the sum of the (a) aggregate payments of interest, principal and all other sums due under
the Note for such specified period (determined as of the date the calculation of Aggregate Debt
Service Coverage is required or requested hereunder and assuming during any period of time during
which the Loan Amount is not amortizing pursuant to the terms of the Note, a thirty year
amortization schedule of level payments utilizing an interest rate equal to the Interest Rate and a
360 day year consisting of twelve (12) thirty day months) and (b) aggregate payments of interest,
principal and all other sums due for such specified period pursuant to the terms of subordinate or
mezzanine financing, if any, then affecting or

4

 

related to the Cross-collateralized Properties or, if Aggregate Debt Service Coverage is being
calculated in connection with a request for consent to any subordinate financing, then proposed.

     “Allocated Loan Amount” shall mean the Initial Allocated Loan Amount of each
Cross-collateralized Property as such amount may be adjusted from time to time as hereinafter set
forth. Upon each adjustment of the Principal Amount (each a “Total Adjustment”), whether as
a result of amortization, defeasance or prepayment or as otherwise expressly provided herein or in
any other Loan Document, each Allocated Loan Amount shall be increased or decreased, as the case
may be, by an amount equal to the product of (a) the Total Adjustment, and (b) a fraction, the
numerator of which is the applicable Allocated Loan Amount (prior to the adjustment in question)
and the denominator of which is the Principal Amount prior to the adjustment to the Principal
Amount which results in the recalculation of the Allocated Loan Amount. However, when the Principal
Amount is reduced as a result of Lender’s receipt of (a) a Release Price or, in connection with a
Release, funds sufficient to prepay a portion of the Principal Amount in the amount of the Release
Price, the Allocated Loan Amount for the Cross-collateralized Property being released and
discharged from the encumbrance of the applicable Cross-collateralized Mortgage and related Loan
Documents shall be reduced to zero (the amount by which such Allocated Loan Amount is reduced being
referred to as the “Released Allocated Amount”), and each other Allocated Loan Amount shall
be decreased by an amount equal to the product of (i) the excess of (A) the Release Price over (B)
the Released Allocated Amount and (ii) a fraction, the numerator of which is the applicable
Allocated Loan Amount (prior to the adjustment in question) and the denominator of which is the
aggregate of all of the Allocated Loan Amounts other than the Allocated Loan Amount applicable to
the Cross-collateralized Property for which the Release Price was paid, or (b) Net Proceeds, the
Allocated Loan Amount for the Cross-collateralized Property with respect to which the Net Proceeds
were received shall be reduced to zero (the amount by which such Allocated Loan Amount is reduced
being referred to as the “Foreclosed Allocated Amount”) and each other Allocated Loan
Amount shall (A) if the Net Proceeds exceed the Foreclosed Allocated Amount (such excess being
referred to as the “Surplus Net Proceeds”), be decreased by an amount equal to the product
of (i) the Surplus Net Proceeds and (ii) a fraction, the numerator of which is the applicable
Allocated Loan Amount (prior to the adjustment in question) and the denominator of which is the
aggregate of all of the Allocated Loan Amounts (prior to the adjustment in question) other than the
Allocated Loan Amount applicable to the Cross-collateralized Property with respect to which the Net
Proceeds were received (such fraction being referred to as the “Net Proceeds Adjustment
Fraction”), (B) if the Foreclosed Allocated Amount exceeds the Net Proceeds (such excess being
referred to as the “Net Proceeds Deficiency”), be increased by an amount equal to the
product of (i) the Net Proceeds Deficiency and (ii) the Net Proceeds Adjustment Fraction, or (C) if
the Net Proceeds equal the Foreclosed Allocated Amount, remain unadjusted, or (c) Loss Proceeds or
partial prepayments or defeasances, as applicable, made in accordance with Section 15.01 hereof,
the Allocated Loan Amount for the Cross-collateralized Property with respect to which the Loss
Proceeds or partial prepayments or defeasances, as applicable, were received shall be decreased by
an amount equal to the sum of (i) with respect to Loss Proceeds, Loss Proceeds which are applied
towards the reduction of the Principal Amount as set forth in Article III hereof, if any, and (ii)
with respect to partial prepayments or defeasances, as applicable, the amount of any such partial
prepayment which is applied towards the reduction of the Principal Amount in accordance with the
provisions of the Note, if any, but in no event shall the Allocated Loan Amount for the
Cross-collateralized Property with respect to which the Loss Proceeds or partial prepayments were
received be reduced to an amount less than zero (the amount by which such Allocated Loan Amount is
reduced being referred to as the “Loss Proceeds or Prepayment Allocated Amount”) and each
other Allocated Loan Amount shall be decreased by an amount equal to the product of (i) the excess
of (A) the Loss Proceeds or such partial prepayments or defeasances, as applicable, over (B) the
Loss Proceeds or Prepayment Allocated Amount, and (ii) a fraction, the numerator of which is the
applicable Allocated Loan Amount (prior to the adjustment in question) and the denominator of which
is the aggregate of all of the Allocated Loan Amounts (prior to the adjustment in question) other
than the Allocated Loan Amount applicable to the Cross-collateralized Property to which such Loss
Proceeds or partial prepayments or defeasances, as applicable, were applied.

     “Annual Budget” shall mean an annual budget submitted by Borrower to Lender in
accordance with the terms of Section 2.09 hereof.

     “Appraisal” shall mean the appraisal of the Property and all supplemental reports or
updates thereto previously delivered to Lender in connection with the Loan.

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     “Appraiser” shall mean the Person who prepared the Appraisal.

     “Approved Annual Budget” shall mean each Annual Budget approved by Lender in
accordance with the terms hereof.

     “Approved Franchisor” shall mean the Franchisors listed on Exhibit F attached hereto
and made a part hereof and any flag operated thereby.

     “Approved Letter of Credit” shall mean an irrevocable, unconditional, transferable,
clean sight draft letter of credit in favor of Lender and its successors and/or assigns, the
obligation to reimburse draws made in connection with which are those of a Person other than
Borrower, with a term of not less than one (1) year and which is drawable in whole or in part by
sight draft in New York City, issued by a bank having a long-term unsecured debt rating of not less
than “AA” (or its equivalent) and a short-term unsecured debt rating of not less than “A-1” (or its
equivalent) by each Rating Agency and otherwise reasonably acceptable to Lender.

     “Approved Manager” shall mean (a) the Manager as of the Closing Date or (b) the
property managers listed on Exhibit F attached hereto and made a part hereof (or an Affiliate 51%
or more of the legal and beneficial interest of which is owned by the managers listed on Exhibit F
attached hereto), provided that each such property manager continues to be Controlled by
substantially the same persons Controlling such property manager as of the Closing Date (or if such
manager is a publicly traded company, such manager continues to be traded on a national stock
exchange or quoted on the NASDAQ Stock Market) and such additional management companies as are
reasonably approved by Lender, which approval may, subsequent to a Securitization, be conditioned
upon, among other things, confirmation from each Rating Agency that any rating issued by the Rating
Agency in connection with a Securitization will not, as a result of the proposed change of Manager,
be downgraded from the current ratings thereof, qualified or withdrawn.

     “Approved Manager Standard” shall mean the standard of business operations, practices
and procedures customarily employed by entities having a senior executive with at least seven (7)
years’ experience in the management of hotels of the same class and quality (as of the Closing
Date) as the Improvements which manage not less than five (5) such hotel properties having an
aggregate number of hotel rooms of not less than five thousand (5,000) hotel rooms.

     “Architect” shall have the meaning set forth in Section 3.04(b)(i) hereof.

     “Assignment” shall mean the Assignment of Leases and Rents and Security Deposits of
even date herewith relating to the Property given by Borrower to Lender, as the same may be
modified, amended or supplemented from time to time.

     “Bank” shall mean the bank, trust company, savings and loan association or savings
bank designated by Lender, in its sole and absolute discretion, in which the Central Account shall
be located.

     “Bankruptcy Code” shall mean 11 U.S.C. §101 et seq., as amended from time to time.

     “Basic Carrying Costs” shall mean the sum of the following costs associated with the
Property: (a) Real Estate Taxes and (b) insurance premiums.

     “Basic Carrying Costs Escrow Account” shall mean the Escrow Account maintained
pursuant to Section 5.06 hereof.

     “Basic Carrying Costs Monthly Installment” shall mean Lender’s estimate of one-twelfth
(1/12th) of the annual amount for Basic Carrying Costs. “Basic Carrying Costs Monthly Installment”
shall also include, if required by Lender, a sum of money which, together with such monthly
installments, will be sufficient to make the payment of each such Basic Carrying Cost at least
thirty (30) days prior to the date initially due. Should such Basic Carrying Costs not be
ascertainable at the time any monthly deposit is required to be made, the Basic Carrying Costs
Monthly Installment shall be determined by Lender in its reasonable discretion on the basis of the
aggregate Basic Carrying

6

 

Costs for the prior Fiscal Year or month or the prior payment period for such cost. As soon
as the Basic Carrying Costs are fixed for the then current Fiscal Year, month or period, the next
ensuing Basic Carrying Costs Monthly Installment shall be adjusted to reflect any deficiency or
surplus in prior monthly payments. If at any time during the term of the Loan Lender determines
that there will be insufficient funds in the Basic Carrying Costs Escrow Account to make payments
when they become due and payable, Lender shall have the right to adjust the Basic Carrying Costs
Monthly Installment such that there will be sufficient funds to make such payments.
Notwithstanding the foregoing, provided that no Event of Default exists, if Borrower is depositing
a sum with Manager on a monthly basis pursuant to the Management Agreement to be used for the
payment of Basic Carrying Costs, such sums are controlled by Manager, and Borrower shall have
delivered, or caused to be delivered to Lender proof that the Basic Carrying Costs with respect to
which Manager is receiving deposits are paid not less than five (5) Business Days prior to the date
upon which any fine, penalty, interest or cost for nonpayment is imposed, the Basic Carrying Costs
Monthly Installment shall be reduced by the amount of Basic Carrying Costs which are deposited with
Manager.

     “Basic Carrying Costs Sub-Account” shall mean the Sub-Account of the Central Account
established pursuant to Section 5.02 into which the Basic Carrying Costs Monthly Installments shall
be deposited.

     “Borrower” shall mean Borrower named herein and any successor to the obligations of
Borrower.

     “Business Day” shall mean any day other than (a) a Saturday or Sunday, or (b) a day on
which banking and savings and loan institutions in the State of New York or the State of North
Carolina are authorized or obligated by law or executive order to be closed, or at any time during
which the Loan is an asset of a Securitization, the cities, states and/or commonwealths used in the
comparable definition of “Business Day” in the Securitization documents.

     “Capital Expenditures” shall mean for any period, the amount expended for items
capitalized under GAAP including expenditures for building improvements or major repairs, leasing
commissions and tenant improvements.

     “Cash Expenses” shall mean for any period, the operating expenses (excluding Capital
Expenditures) for the Property as set forth in an Approved Annual Budget to the extent that such
expenses are actually incurred by Borrower minus payments into the Basic Carrying Costs
Sub-Account, the Debt Service Payment Sub-Account and the Recurring Replacement Reserve Sub-Account
(to the extent such sums are for the payment of sums set forth as operating expenses in the
Approved Annual Budget).

     “Central Account” shall mean an Eligible Account, maintained at the Bank, in the name
of Lender or its successors or assigns (as secured party) as may be designated by Lender.

     “Closing Date” shall mean the date of the Note.

     “Code” shall mean the Internal Revenue Code of 1986, as amended and as it may be
further amended from time to time, any successor statutes thereto, and applicable U.S. Department
of Treasury regulations issued pursuant thereto.

     “Collection Account” shall mean one or more Eligible Accounts maintained in a bank
acceptable to Lender in the joint names of Borrower and Lender or such other name as Lender may
designate in writing.

     “Condemnation Proceeds” shall mean all of the proceeds in respect of any Taking or
purchase in lieu thereof.

     “Contractual Obligation” shall mean, as to any Person, any provision of any security
issued by such Person or of any agreement, instrument or undertaking to which such Person is a
party or by which it or any of the property owned by it is bound.

     “Control” means, when used with respect to any specific Person, the possession,
directly or indirectly, of the power to direct or cause the direction of the management and
policies of such Person whether through ownership

7

 

of voting securities, beneficial interests, by contract or otherwise. The definition is to be
construed to apply equally to variations of the word “Control” including “Controlled,”
“Controlling” or “Controlled by.”

     “CPI” shall mean “The Consumer Price Index (New Series) (Base Period 1982-84=100) (all
items for all urban consumers)” issued by the Bureau of Labor Statistics of the United States
Department of Labor (the “Bureau”). If the CPI ceases to use the 1982-84 average equaling
100 as the basis of calculation, or if a change is made in the term, components or number of items
contained in said index, or if the index is altered, modified, converted or revised in any other
way, then the index shall be adjusted to the figure that would have been arrived at had the change
in the manner of computing the index in effect at the date of this Security Instrument not been
made. If at any time during the term of this Security Instrument the CPI shall no longer be
published by the Bureau, then any comparable index issued by the Bureau or similar agency of the
United States issuing similar indices shall be used in lieu of the CPI.

     “Cross-collateralization Agreement” shall mean that certain Cross-collateralization
Agreement of even date herewith between Borrower, the other Cross-collateralized Borrowers and
Lender.

     “Cross-collateralized Borrowers” shall mean each Person which has executed the Note.

     “Cross-collateralized Mortgage” shall mean each mortgage, deed of trust, deed to
secure debt, security agreement, assignment of rents and fixture filing as originally executed or
as same may hereafter from time to time be supplemented, amended, modified or extended by one or
more indentures supplemental thereto granted by a Cross-collateralized Borrower to Lender as
security for the Note.

     “Cross-collateralized Property” shall mean each parcel or parcels of real property
encumbered by a Cross-collateralized Mortgage as identified on Exhibit C attached hereto and made a
part hereof; provided, however, at such time, if any, that a Cross-collateralized Mortgage is
released by Lender, the property which was encumbered by such Cross-collateralized Property shall
no longer constitute a Cross-collateralized Property.

     “Curtailment Reserve Escrow Account” shall mean the Escrow Account maintained pursuant
to Section 5.11 hereof into which sums shall be deposited during an O&M Operative Period.

     “Curtailment Reserve Sub-Account” shall mean the Sub-Account of the Central Account
established pursuant to Section 5.02 hereof into which excess cash flow shall be deposited pursuant
to Section 5.05.

     “Debt” shall have the meaning set forth in the Recitals hereto.

     “Debt Service” shall mean the amount of interest and principal payments due and
payable in accordance with the Note during an applicable period.

     “Debt Service Coverage” shall mean the quotient obtained by dividing Adjusted Net Cash
Flow by the sum of the (a) aggregate payments of interest, principal and all other sums due for
such specified period which are allocable to a principal portion of the Note equal to the Allocated
Loan Amount (determined as of the date the calculation of Debt Service Coverage is required or
requested hereunder and assuming during any period of time during which the Loan Amount is not
amortizing pursuant to the terms of the Note, a thirty year amortization schedule of level payments
utilizing an interest rate equal to the Interest Rate and a 360 day year consisting of twelve (12)
thirty day months) and (b) aggregate payments of interest, principal and all other sums due for
such specified period pursuant to the terms of subordinate or mezzanine financing (to the extent
allocable to the Property, as determined by Lender in its reasonable discretion), if any, then
affecting or related to the Property or, if Debt Service Coverage is being calculated in connection
with a request for consent to any subordinate or mezzanine financing, then proposed.

     “Debt Service Payment Sub-Account” shall mean the Sub-Account of the Central Account
established pursuant to Section 5.02 hereof into which the Required Debt Service Payment shall be
deposited.

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     “Debt Yield” shall mean Adjusted Net Cash Flow for all of the Cross-collateralized
Properties divided by the sum of (a) the unpaid Principal Amount and (b) the outstanding principal
balance of any subordinate or mezzanine financing then affecting or related to the Property or any
interest therein (determined as of the date of the calculation of Debt Yield).

     “Default” shall mean any Event of Default or event which would constitute an Event of
Default if all requirements in connection therewith for the giving of notice, the lapse of time,
and the happening of any further condition, event or act, had been satisfied.

     “Default Management Period” shall mean any period of time during the term hereof when
the Property is not being managed by an Approved Manager pursuant to the terms hereof.

     “Default Rate” shall mean the lesser of (a) the highest rate allowable at law and (b)
five percent (5%) above the interest rate set forth in the Note.

     “Default Rate Interest” shall mean, to the extent the Default Rate becomes applicable,
interest in excess of the interest which would have accrued on (a) the Principal Amount and (b) any
accrued but unpaid interest, if the Default Rate was not applicable.

     “Defeasance Deposit” shall mean an amount equal to the total cost incurred or to be
incurred in the purchase on behalf of Borrower of Federal Obligations necessary to meet the
Scheduled Defeasance Payments.

     “Defeased Note” shall have the meaning set forth in Section 15.01 hereof.

     “Development Laws” shall mean all applicable subdivision, zoning, environmental
protection, wetlands protection, or land use laws or ordinances, and any and all applicable rules
and regulations of any Governmental Authority promulgated thereunder or related thereto.

     “Disclosure Document” shall mean a prospectus, prospectus supplement, private
placement memorandum, or similar offering memorandum or offering circular, in each case in
preliminary or final form, used to offer securities in connection with a Securitization.

     “Dollar” and the sign “$” shall mean lawful money of the United States of America.

     “Eligible Account” shall mean a segregated account which is either (a) an account or
accounts maintained with a federal or state chartered depository institution or trust company the
long term unsecured debt obligations of which are rated by each of the Rating Agencies (or, if not
rated by Fitch, Inc. (“Fitch”), otherwise acceptable to Fitch, as confirmed in writing that
such account would not, in and of itself, result in a downgrade, qualification or withdrawal of the
then current ratings assigned to any certificates issued in connection with a Securitization) in
its second highest rating category at all times (or, in the case of the Basic Carrying Costs Escrow
Account, the long term unsecured debt obligations of which are rated at least “AA” (or its
equivalent)) by each of the Rating Agencies (or, if not rated by Fitch, otherwise acceptable to
Fitch, as confirmed in writing that such account would not, in and of itself, result in a
downgrade, qualification or withdrawal of the then current ratings assigned to any certificates
issued in connection with a Securitization) or, if the funds in such account are to be held in such
account for less than thirty (30) days, the short term obligations of which are rated by each of
the Rating Agencies (or, if not rated by Fitch, otherwise acceptable to Fitch, as confirmed in
writing that such account would not, in and of itself, result in a downgrade, qualification or
withdrawal of the then current ratings assigned to any certificates issued in connection with a
Securitization) in its second highest rating category at all times or (b) a segregated trust
account or accounts maintained with a federal or state chartered depository institution or trust
company acting in its fiduciary capacity which, in the case of a state chartered depository
institution is subject to regulations substantially similar to 12 C.F.R. § 9.10(b), having in
either case a combined capital and surplus of at least $100,000,000 and subject to supervision or
examination by federal and state authority, or otherwise acceptable (as evidenced by a written
confirmation from each Rating Agency that such account would not, in and of itself, cause a
downgrade, qualification or withdrawal of the then current ratings assigned to any certificates
issued in connection with a Securitization) to each Rating Agency, which may be an account
maintained by Lender or its agents. Eligible

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Accounts may bear interest. The title of each Eligible Account shall indicate that the funds
held therein are held in trust for the uses and purposes set forth herein.

     “Engineer” shall have the meaning set forth in Section 3.04(b)(i) hereof.

     “Engineering Escrow Account” shall mean an Escrow Account established and maintained
pursuant to Section 5.12 hereof relating to payments for any Required Engineering Work.

     “Environmental Problem” shall mean any of the following:

     (a) the presence of any Hazardous Material on, in, under, or above all or any portion
of the Property in violation of any Environmental Statute;

     (b) the release of any Hazardous Material from or onto the Property to the extent such
release is required to be reported pursuant to Environmental Statutes;

     (c) the violation or threatened violation of any Environmental Statute with respect to
the Property; or

     (d) the failure to obtain or to abide by the terms or conditions of any permit or
approval required under any Environmental Statute with respect to the Property.

A condition described above shall be an Environmental Problem regardless of whether or not any
Governmental Authority has taken any action in connection with the condition and regardless of
whether that condition was in existence on or before the date hereof.

     “Environmental Report” shall mean the environmental audit report for the Property and
any supplements or updates thereto, previously delivered to Lender in connection with the Loan.

     “Environmental Statute” shall mean any federal, state or local statute, ordinance,
rule or regulation, any judicial or administrative order (whether or not on consent) or judgment
applicable to Borrower or the Property including, without limitation, any judgment or settlement
based on common law theories, and any provisions or conditions of any permit, license or other
authorization binding on Borrower relating to (a) the protection of the environment, the safety and
health of persons (including employees) or the public welfare from actual or potential exposure (or
effects of exposure) to any actual or potential release, discharge, disposal or emission (whether
past or present) of any Hazardous Materials or (b) the manufacture, processing, distribution, use,
treatment, storage, disposal, transport or handling of any Hazardous Materials, including, but not
limited to, the Comprehensive Environmental Response, Compensation and Liability Act of 1980
(“CERCLA”), as amended by the Superfund Amendments and Reauthorization Act of 1986, 42
U.S.C. §9601 et seq., the Solid Waste Disposal Act, as amended by the Resource
Conservation and Recovery Act of 1976, as amended by the Solid and Hazardous Waste Amendments of
1984, 42 U.S.C. §6901 et seq., the Federal Water Pollution Control Act, as amended
by the Clean Water Act of 1977, 33 U.S.C. §1251 et seq., the Toxic Substances
Control Act of 1976, 15 U.S.C. §2601 et seq., the Emergency Planning and Community
Right-to-Know Act of 1986, 42 U.S.C. §1101 et seq., the Clean Air Act of 1966, as
amended, 42 U.S.C. §7401 et seq., the National Environmental Policy Act of 1975, 42
U.S.C. §4321, the Rivers and Harbors Act of 1899, 33 U.S.C. §401 et seq., the
Endangered Species Act of 1973, as amended, 16 U.S.C. §1531 et seq., the
Occupational Safety and Health Act of 1970, as amended, 29 U.S.C. §651 et seq., and
the Safe Drinking Water Act of 1974, as amended, 42 U.S.C. §300(f) et seq., and all
rules, regulations and guidance documents promulgated or published thereunder.

     “Equipment” shall have the meaning set forth in granting clause (d) of this Security
Instrument.

     “ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended
from time to time, and the regulations promulgated thereunder. Section references to ERISA are to
ERISA, as in effect at the date of this Security Instrument and, as of the relevant date, any
subsequent provisions of ERISA, amendatory thereof, supplemental thereto or substituted therefor.

10

 

     “ERISA Affiliate” shall mean any corporation or trade or business that is a member of
any group of organizations (a) described in Section 414(b) or (c) of the Code of which Borrower or
Guarantor is a member and (b) solely for purposes of potential liability under Section 302(c)(11)
of ERISA and Section 412(c)(11) of the Code and the lien created under Section 302(f) of ERISA and
Section 412(n) of the Code, described in Section 414(m) or (o) of the Code of which Borrower or
Guarantor is a member.

     “Escrow Account” shall mean each of the Engineering Escrow Account, the Basic Carrying
Costs Escrow Account, the Recurring Replacement Reserve Escrow Account, the Operation and
Maintenance Expense Escrow Account and the Curtailment Reserve Escrow Account, each of which shall
be an Eligible Account or book entry sub-account of an Eligible Account.

     “Event of Default” shall have the meaning set forth in Section 13.01 hereof.

     “Extraordinary Expense” shall mean an extraordinary operating expense or capital
expense not set forth in the Approved Annual Budget or allotted for in the Recurring Replacement
Reserve Sub-Account.

     “Federal Obligations” shall mean non-callable direct obligations of, or obligations
fully guaranteed as to payment of principal and interest by, the United States of America or any
agency or instrumentality thereof provided that such obligations are backed by the full faith and
credit of the United States of America or, provided, that Lender has received written confirmation
from each Rating Agency that the defeasance of the Loan with other “governmental securities” within
the meaning of §2(a)(16) of the Investment Company Act of 1940, as amended, is acceptable and such
securities are permitted pursuant to the rules and regulations relating to REMICs (as defined in
Section 15.01 hereof) or other governmental securities, in each case as chosen by Borrower.

     “Fiscal Year” shall mean the twelve (12) month period commencing on January 1 and
ending on December 31 during each year of the term of this Security Instrument, or such other
fiscal year of Borrower as Borrower may select from time to time with the prior written consent of
Lender.

     “Fixtures” shall have the meaning set forth in granting clause (d) of this Security
Instrument.

     “Force Majeure” shall mean acts of god, governmental restrictions, stays, judgments,
orders, decrees, enemy actions, civil commotion, fire, casualty, strikes or work stoppages which
are industry-wide and not aimed at Borrower nor its Affiliates, or other causes beyond the
reasonable control of Borrower and/or its Affiliates, but Borrower’s lack of funds in and of itself
shall not be deemed a cause beyond the control of Borrower.

     “Franchise Agreement” shall mean any franchise or license agreement relating to the
branding or operation of the Premises or any other agreement pursuant to which a franchise system,
reservation system or brand affiliation is made available to the hotel operator of the Premises,
together with all renewals and replacements thereof.

     “GAAP” shall mean generally accepted accounting principles in the United States of
America, as of the date of the applicable financial report, consistently applied.

     “General Partner” shall mean, if Borrower or Operating Tenant is a partnership, each
general partner of Borrower or Operating Tenant, as applicable, and, if Borrower or Operating
Tenant is a limited liability company, each managing member, if any, of Borrower or Operating
Tenant, as applicable, and in each case, if applicable, each general partner or managing member of
such general partner or managing member. In the event that Borrower or Operating Tenant or any
General Partner is a single member limited liability company with a managing member, the term
“General Partner” shall include such single member.

     “Governmental Authority” shall mean, with respect to any Person, any federal or State
government or other political subdivision thereof and any entity, including any regulatory or
administrative authority or court, exercising executive, legislative, judicial, regulatory or
administrative or quasi-administrative functions of or pertaining to government, and any
arbitration board or tribunal, in each case having jurisdiction over such applicable Person or such
Person’s property and any stock exchange on which shares of capital stock of such Person are listed
or admitted for trading.

11

 

     “Guarantor” shall mean any Person guaranteeing, in whole or in part, the obligations
of Borrower under the Loan Documents.

     “Hazardous Material” shall mean any flammable, explosive or radioactive materials,
hazardous materials or wastes, hazardous or toxic substances, pollutants or related materials,
asbestos or any material containing asbestos, molds, spores and fungus which may pose a risk to
human health or the environment or any other substance or material as defined in or regulated by
any Environmental Statutes.

     “Impositions” shall mean all taxes (including, without limitation, all real estate, ad
valorem, sales (including those imposed on lease rentals), use, single business, gross receipts,
value added, intangible, transaction, privilege or license or similar taxes), assessments
(including, without limitation, all assessments for public improvements or benefits, whether or not
commenced or completed prior to the date hereof and whether or not commenced or completed within
the term of this Security Instrument), ground rents, water, sewer or other rents and charges,
excises, levies, fees (including, without limitation, license, permit, inspection, authorization
and similar fees), and all other governmental charges, in each case whether general or special,
ordinary or extraordinary, or foreseen or unforeseen, of every character in respect of the Property
and/or any Rent (including all interest and penalties thereon), which at any time prior to, during
or in respect of the term hereof may be assessed or imposed on or in respect of or be a lien upon
(a) Borrower (including, without limitation, all franchise, single business or other taxes imposed
on Borrower for the privilege of doing business in the jurisdiction in which the Property or any
other collateral delivered or pledged to Lender in connection with the Loan is located) or Lender,
(b) the Property or any part thereof or any Rents therefrom or any estate, right, title or interest
therein, or (c) any occupancy, operation, use or possession of, or sales from, or activity
conducted on, or in connection with the Property, or any part thereof, or the leasing or use of the
Property, or any part thereof, or the acquisition or financing of the acquisition of the Property,
or any part thereof, by Borrower. Impositions shall not include any taxes imposed on Lender’s
income and franchise taxes imposed on Lender by the law or regulation of any Governmental
Authority.

     “Improvements” shall have the meaning set forth in granting clause (b) of this
Security Instrument.

     “Indemnified Parties” shall have the meaning set forth in Section 12.01 hereof.

     “Independent” shall mean, when used with respect to any Person, a Person who (a) is in
fact independent, (b) does not have any direct financial interest or any material indirect
financial interest in Borrower, or in any Affiliate of Borrower or any constituent partner,
shareholder, member or beneficiary of Borrower, (c) is not connected with Borrower or any Affiliate
of Borrower or any constituent partner, shareholder, member or beneficiary of Borrower as an
officer, employee, promoter, underwriter, trustee, partner, director or person performing similar
functions and (d) is not a member of the immediate family of a Person defined in (b) or (c) above.
Whenever it is herein provided that any Independent Person’s opinion or certificate shall be
provided, such opinion or certificate shall state that the Person executing the same has read this
definition and is Independent within the meaning hereof.

     “Initial Allocated Loan Amount” shall mean the portion of the Loan Amount allocated to
each Cross-collateralized Property as set forth on Exhibit C annexed hereto and made a part hereof.

     “Initial Engineering Deposit” shall equal the amount set forth on Exhibit B attached
hereto and made a part hereof.

     “Institutional Lender” shall mean any of the following Persons: (a) any bank, savings
and loan association, savings institution, trust company or national banking association, acting
for its own account or in a fiduciary capacity, (b) any charitable foundation, (c) any insurance
company or pension and/or annuity company, (d) any fraternal benefit society, (e) any pension,
retirement or profit sharing trust or fund within the meaning of Title I of ERISA or for which any
bank, trust company, national banking association or investment adviser registered under the
Investment Advisers Act of 1940, as amended, is acting as trustee or agent, (f) any investment
company or business development company, as defined in the Investment Company Act of 1940, as
amended, (g) any small business investment company licensed under the Small Business Investment Act
of 1958, as amended, (h) any broker or dealer registered under the Securities Exchange Act of 1934,
as amended, or any investment adviser

12

 

registered under the Investment Adviser Act of 1940, as amended, (i) any government, any
public employees’ pension or retirement system, or any other government agency supervising the
investment of public funds, or (j) any other entity all of the equity owners of which are
Institutional Lenders; provided that each of said Persons shall have net assets in excess of
$1,000,000,000 and a net worth in excess of $500,000,000, be in the business of making commercial
mortgage loans, secured by properties of like type, size and value as the Property and have a long
term credit rating which is not less than “BBB-” (or its equivalent) from each Rating Agency.

     “Insurance Proceeds” shall mean all of the proceeds received under the insurance
policies required to be maintained by Borrower pursuant to Article III hereof.

     “Insurance Requirements” shall mean all terms of any insurance policy required by this
Security Instrument, all requirements of the issuer of any such policy, and all regulations and
then current standards applicable to or affecting the Property or any use or condition thereof,
which may, at any time, be recommended by the Board of Fire Underwriters, if any, having
jurisdiction over the Property, or such other Person exercising similar functions.

     “Interest Accrual Period” shall mean each one (1) month period, which shall commence
on the eleventh (11th) day of each calendar month and end on and include the tenth (10th) day of
the next occurring calendar month.

     “Interest Rate” shall have the meaning set forth in the Note.

     “Interest Shortfall” shall mean any shortfall in the amount of interest required to be
paid with respect to the Loan Amount on any Payment Date.

     “Inventory” shall have the meaning as such term is defined in the Uniform Commercial
Code applicable in the State in which the Property is located, including, without limitation,
provisions in storerooms, refrigerators, pantries and kitchens, beverages in wine cellars and bars,
other merchandise for sale, fuel, mechanical supplies, stationery and other expenses, supplies and
similar items, as defined in the Uniform System of Accounts.

     “Late Charge” shall have the meaning set forth in Section 13.09 hereof.

     “Leases” shall have the meaning set forth in granting clause (f) of this Security
Instrument.

     “Legal Requirement” shall mean as to any Person, the certificate of incorporation,
by-laws, certificate of limited partnership, agreement of limited partnership or other organization
or governing documents of such Person, and any law, statute, order, ordinance, judgement, decree,
injunction, treaty, rule or regulation (including, without limitation, Environmental Statutes,
Development Laws and Use Requirements) or determination of an arbitrator or a court or other
Governmental Authority and all covenants, agreements, restrictions and encumbrances contained in
any instruments, in each case applicable to or binding upon such Person or any of its property or
to which such Person or any of its property is subject.

     “Lender” shall mean the Lender named herein and its successors or assigns.

     “Loan” shall have the meaning set forth in the Recitals hereto.

     “Loan Amount” shall have the meaning set forth in the Recitals hereto.

     “Loan Documents” shall mean this Security Instrument, the Note, the Assignment, and
any and all other agreements, instruments, certificates or documents executed and delivered by
Borrower, any of the Cross-collateralized Borrowers or any Affiliate of Borrower in connection with
the Loan, together with any supplements, amendments, modifications or extensions thereof.

     “Loan Year” shall mean each 365 day period (or 366 day period if the month of February
in a leap year is included) commencing on the first day of the month following the Closing Date
(provided, however, that the first

13

 

Loan Year shall also include the period from the Closing Date to the end of the month in which
the Closing Date occurs).

     “Lockout Expiration Date” shall have the meaning set forth in Section 15.01 hereof.

     “Loss Proceeds” shall mean, collectively, all Insurance Proceeds and all Condemnation
Proceeds.

     “Major Space Lease” shall mean any Space Lease of a tenant or Affiliate of such tenant
where such tenant, together with such Affiliate, leases, in the aggregate, 10,000 square feet or
more and each restaurant, bar and/or casino lease.

     “Management Agreement” shall have the meaning set forth in Section 7.02 hereof.

     “Manager” shall mean the Person, other than Borrower and/or Operating Tenant, which
manages the Property on behalf of Borrower.

     “Material Adverse Effect” shall mean any event or condition that has a material
adverse effect on (a) the Property, (b) the business, prospects, profits, management, operations or
condition (financial or otherwise) of Borrower, (c) the enforceability, validity, perfection or
priority of the lien of any Loan Document or (d) the ability of Borrower to perform any obligations
under any Loan Document.

     “Maturity”, when used with respect to the Note, shall mean the Maturity Date set forth
in the Note or such other date pursuant to the Note on which the final payment of principal, and
premium, if any, on the Note becomes due and payable as therein or herein provided, whether at
Stated Maturity or by declaration of acceleration, or otherwise.

     “Maturity Date” shall mean the Maturity Date set forth in the Note.

     “Multiemployer Plan” shall mean a multiemployer plan defined as such in Section 3(37)
of ERISA to which contributions have been, or were required to have been, made by Borrower,
Guarantor or any ERISA Affiliate and which is covered by Title IV of ERISA.

     “Net Capital Expenditures” shall mean for any period the amount by which Capital
Expenditures during such period exceed reimbursements for such items during such period from any
fund established pursuant to the Loan Documents.

     “Net Operating Income” shall mean in each Fiscal Year or portion thereof during the
term hereof, Operating Income less Operating Expenses.

     “Net Proceeds” shall mean the excess of (a)(i) the purchase price (at foreclosure or
otherwise) actually received by Lender with respect to the Property as a result of the exercise by
Lender of its rights, powers, privileges and other remedies after the occurrence of an Event of
Default, or (ii) in the event that Lender (or Lender’s nominee) is the purchaser at foreclosure by
credit bid, then the amount of such credit bid, in either case, over (b) all costs and expenses,
including, without limitation, all attorneys’ fees and disbursements and any brokerage fees, if
applicable, incurred by Lender in connection with the exercise of such remedies, including the sale
of such Property after a foreclosure against the Property.

     “Note” shall have the meaning set forth in the Recitals hereto.

     “O&M Operative Period” shall mean the period of time (a) commencing upon the earlier
to occur of (i) an Event of Default and (ii) determination by Lender that the Aggregate Debt
Service Coverage (tested quarterly except during the continuance of an O&M Operative Period, in
which event the Aggregate Debt Service Coverage shall be tested monthly and shall be calculated
based upon information contained in the reports furnished to Lender pursuant to Section 2.09
hereof) is less than 1.10:1 and (b) and terminating (i) if the O&M Operative Period commenced
pursuant to clause (a)(i) above, upon the cure of all Events of Default, provided that Lender
accepts the

14

 

cure of all Events of Default, the Loan has not been accelerated and Lender has not moved for
the appointment of a receiver with respect to one or more Cross-collateralized Properties nor
commenced foreclosure proceedings with respect to any Cross-collateralized Properties, and (ii) if
the O&M Operative Period commenced pursuant to clause (a)(ii) above, on the Payment Date next
succeeding the date upon which Lender determines that the Aggregate Debt Service Coverage for three
(3) consecutive months is 1.10:1 or greater.

     “OFAC List” shall mean the list of specially designated nationals and blocked persons
subject to financial sanctions that is maintained by the U.S. Treasury Department, Office of
Foreign Assets Control and accessible through the internet website
www.treas.gov/ofac/t11sdn.pdf.

     “Officer’s Certificate” shall mean a certificate delivered to Lender by Borrower which
is signed on behalf of Borrower by an authorized representative of Borrower which states that the
items set forth in such certificate are true, accurate and complete in all respects.

     “Operating Expenses” shall mean, in each Fiscal Year or portion thereof during the
term hereof, all expenses directly attributable to the operation, repair and/or maintenance of the
Property including, without limitation, (a) Impositions, (b) insurance premiums, (c) management
fees, whether or not actually paid, equal to the greater of the actual management fees and four
percent (4%) of annual gross operating income and (d) costs attributable to the operation, repair
and maintenance of the systems for heating, ventilating and air conditioning the Improvements and
actually paid for by Borrower. Operating Expenses shall not include interest, principal and
premium, if any, due under the Note or otherwise in connection with the Debt, income taxes,
extraordinary capital improvement costs, any non-cash charge or expense such as depreciation or
amortization or any item of expense otherwise includable in Operating Expenses which is paid
directly by any tenant except real estate taxes paid directly to any taxing authority by any
tenant.

     “Operating Income” shall mean, in each Fiscal Year or portion thereof during the term
hereof, all revenue derived by Borrower or Operating Tenant (or by Manager for the Account of
Borrower or Operating Tenant) arising from the Property including, without limitation, room
revenues, vending machines revenues, beverage revenues, food revenues, and packaging revenues,
rental revenues (whether denominated as basic rent, additional rent, escalation payments,
electrical payments or otherwise) and other fees and charges payable pursuant to Leases or
otherwise in connection with the Property, and business interruption, rent or other similar
insurance proceeds. Operating Income shall not include (a) Insurance Proceeds (other than proceeds
of rent, business interruption or other similar insurance allocable to the applicable period) and
Condemnation Proceeds (other than Condemnation Proceeds arising from a temporary taking or the use
and occupancy of all or part of the applicable Property allocable to the applicable period), or
interest accrued on such Condemnation Proceeds, (b) proceeds of any financing, (c) proceeds of any
sale, exchange or transfer of the Property or any part thereof or interest therein, (d) capital
contributions or loans to Borrower or an Affiliate of Borrower, (e) any item of income otherwise
includable in Operating Income but paid directly by any tenant to a Person other than Borrower
except for real estate taxes paid directly to any taxing authority by any tenant, (f) any other
extraordinary, non-recurring revenues, (g) Rent paid by or on behalf of any lessee under an
Operating Lease or Space Lease which is the subject of any proceeding or action relating to its
bankruptcy, reorganization or other arrangement pursuant to the Bankruptcy Code or any similar
federal or state law or which has been adjudicated a bankrupt or insolvent unless such Operating
Lease or Space Lease, as applicable, has been affirmed by the trustee in such proceeding or action,
(h) Rent paid by or on behalf of any lessee under a Lease the demised premises of which are not
occupied either by such lessee or by a sublessee thereof for sixty (60) or more days unless the
lessee has a long term unsecured debt rating of not less than “A” (or its equivalent) from each
Rating Agency; (i) Rent paid by or on behalf of any lessee under a Lease in whole or partial
consideration for the termination of any Lease, or (j) sales tax rebates from any Governmental
Authority.

     “Operating Lease” shall mean any Lease of the entire Property pursuant to which a
Person other than Borrower assumes responsibility for the operation and management of the Property,
as the same may be amended from time to time.

     “Operating Tenant” shall mean the tenant under the Operating Lease.

15

 

     “Operation and Maintenance Expense Escrow Account” shall mean the Escrow Account
maintained pursuant to Section 5.09 hereof relating to the payment of Operating Expenses (exclusive
of Basic Carrying Costs).

     “Operation and Maintenance Expense Sub-Account” shall mean the Sub-Account of the
Central Account established pursuant to Section 5.02 hereof into which sums allocated for the
payment of Cash Expenses, Net Capital Expenditures and approved Extraordinary Expenses shall be
deposited.

     “Payment Date” shall mean, with respect to each month, the eleventh (11th) calendar
day in such month, or if such day is not a Business Day, the next following Business Day.

     “PBGC” shall mean the Pension Benefit Guaranty Corporation established under ERISA, or
any successor thereto.

     “Permitted Encumbrances” shall have the meaning set forth in Section 2.05(a) hereof.

     “Permitted Liens” shall mean (a) the lien of any Equipment leases and Equipment
financing permitted in accordance with the terms of this Security Instrument, (b) the liens created
by the Loan Documents, (c) liens, if any, for Impositions not yet due or delinquent or being
contested in accordance with the terms of this Security Instrument, (d) any and all governmental,
public utility and private restrictions, covenants, reservations, easements, licenses or other
similar agreements which may hereafter be granted by Borrower in the ordinary course of business
and which may not reasonably be expected to have a Material Adverse Effect, (e) rights of existing
and future tenants, licensees and concessionaries pursuant to Leases in effect as of the date
hereof or entered into in accordance with the terms of the Loan Documents, and (f) the Operating
Lease and any renewal or replacement thereof in accordance with the terms of this Security
Agreement at the expiration thereof.

     “Permitted Transfer” shall mean, (a) Permitted Liens; (b) all transfers of Equipment
and other items of personal property as expressly permitted in the Loan Documents; (c) transfers of
direct and indirect interests in Borrower (other than interests held by a General Partner) and/or
in General Partner to one or more Affiliates of Borrower; (d) transfers, issuances, conversions,
pledges and redemptions of capital stock and partnership interests convertible into capital stock
in Ashford Hospitality Trust, Inc., a Maryland corporation or Ashford Hospitality Limited
Partnership, a Delaware limited partnership (or their respective successors) in the ordinary course
of business and not in connection with a tender offer, merger or sale of such Persons and (e) the
merger or consolidation of Ashford Hospitality Trust, Inc., Ashford OP General Partner LLC, Ashford
OP Limited Partner LLC or Ashford Hospitality Limited Partnership (or their respective successors)
whereby such entity is the surviving entity in such merger or consolidation, provided that,
subsequent to a Securitization, each Rating Agency shall have delivered written confirmation that
any ratings issued by the Rating Agency in connection with a Securitization will not, as a result
of the proposed merger or consolidation, be downgraded from the then current ratings thereof,
qualified or withdrawn, provided in each of the foregoing events, (a) ultimate Control of Borrower
remains with the same Persons which ultimately Controlled Borrower as of the Closing Date, (b) in
the event that any Person which as of the Closing Date does not own 49% or more of the director or
indirect interest in Borrower or Operating Tenant, if applicable, obtains a 49% or greater direct
or indirect interest in Borrower or Operating Partnership, Borrower shall deliver a substantive
non-consolidation opinion to Lender in form and substance and from counsel reasonably acceptable to
Lender and (c) no Transfer may be to a Prohibited Person.

     “Person” shall mean any individual, corporation, limited liability company,
partnership, joint venture, estate, trust, unincorporated association, any federal, state, county
or municipal government or any bureau, department or agency thereof and any fiduciary acting in
such capacity on behalf of any of the foregoing.

     “Plan” shall mean an employee benefit or other plan established or maintained by
Borrower, Guarantor or any ERISA Affiliate during the five-year period ended prior to the date of
this Security Instrument or to which Borrower, Guarantor or any ERISA Affiliate makes, is obligated
to make or has, within the five year period ended prior to the date of this Security Instrument,
been required to make contributions (whether or not covered by Title IV of ERISA or Section 302 of
ERISA or Section 401(a) or 412 of the Code), other than a Multiemployer Plan.

     “Premises” shall have the meaning set forth in granting clause (a) of this Security
Instrument.

16

 

     “Principal Amount” shall mean the Loan Amount as such amount may be reduced from time
to time pursuant to the terms of this Security Instrument, the Note or the other Loan Documents.

     “Principal Payments” shall mean all payments of principal made pursuant to the terms
of the Note.

     “Prohibited Person” shall mean any Person and/or any Affiliate thereof identified on
the OFAC List or any other Person or foreign country or agency thereof with whom a U.S. Person may
not conduct business or transactions by prohibition of Federal law or Executive Order of the
President of the United States of America.

     “Property” shall have the meaning set forth in the granting clauses of this Security
Instrument.

     “Property Agreements” shall mean all agreements, grants of easements and/or
rights-of-way, reciprocal easement agreements, permits, declarations of covenants, conditions and
restrictions, disposition and development agreements, planned unit development agreements, parking
agreements, party wall agreements or other instruments affecting the Property, but not including
any brokerage agreements, Management Agreements, Operating Leases, Franchise Agreements, service
contracts, Space Leases or the Loan Documents.

     “Property Available Cash” shall mean all amounts payable to Borrower and/or Operating
Tenant pursuant to the Management Agreement.

     “Rating Agency” shall mean each of Standard & Poor’s Ratings Services, a division of
The McGraw-Hill Company, Inc. (“Standard & Poor’s”), Fitch, Inc., and Moody’s Investors
Service, Inc. (“Moody’s”) and any successor to any of them; provided, however, that at any
time after a Securitization, “Rating Agency” shall mean those of the foregoing rating agencies that
from time to time rate the securities issued in connection with such Securitization.

     “Real Estate Taxes” shall mean all real estate taxes, assessments (including, without
limitation, all assessments for public improvements or benefits, whether or not commenced or
completed prior to the date hereof and whether or not commenced or completed within the term of
this Security Instrument), water, sewer or other rents and charges, and all other governmental
charges, in each case whether general or special, ordinary or extraordinary, or foreseen or
unforeseen, of every character in respect of the Property (including all interest and penalties
thereon), which at any time prior to, during or in respect of the term hereof may be assessed or
imposed on or in respect of or be a lien upon the Property or any part thereof or any estate,
right, title or interest therein.

     “Realty” shall have the meaning set forth in Section 2.05(b) hereof.

     “Recurring Replacement Expenditures” shall mean expenditures related to capital
repairs, replacements and improvements performed at the Property from time to time.

     “Recurring Replacement Reserve Escrow Account” shall mean the Escrow Account
maintained pursuant to Section 5.08 hereof relating to the payment of Recurring Replacement
Expenditures.

     “Recurring Replacement Reserve Monthly Installment” shall mean the amount per month
set forth on Exhibit B attached hereto and made a part hereof (the “Initial Recurring
Installments”) until the end of 2007 and an amount per month in each subsequent year or
portion thereof occurring prior to the Maturity Date equal to four percent (4%) (or such lesser
amount as is required to be reserved for replacements pursuant to the Management Agreement (but in
no event less than three (3%) percent of the total revenues of the Property) of the total revenues
of the Property for the prior calendar year divided by twelve (12). Notwithstanding the foregoing,
if Borrower has delivered evidence reasonably satisfactory to Lender on or before the Payment Date
occurring in March of each year that Borrower has deposited with Manager on account of the prior
year pursuant to the Management Agreement a sum equal to the Recurring Replacement Reserve Monthly
Installment described in the first sentence of this definition multiplied by twelve (12) (the
“Minimum Replacement Expenditure”) to be used for Recurring Replacement Expenditures or
that Borrower and/or Manager on behalf of Borrower has incurred and paid a sum which when added to
the amounts on deposit with Manager are equal to or greater than the Minimum Replacement
Expenditure during the prior calendar year, the Recurring Replacement Reserve Monthly Installment
shall be zero

17

 

and, if the sum of the amounts on deposit with manager to be used for Recurring Replacement
Expenditures pursuant to the Management Agreement together with the sums that Borrower and/or
Manager on behalf of Borrower has incurred and paid for Recurring Replacement Expenditures are less
than the Minimum Replacement Expenditure, the Recurring Replacement Reserve Monthly Installment
shall be the lesser of the amount described in the first sentence of this definition and the amount
by which the amount described in the first sentence of this definition exceeds one-twelfth of the
difference between the Minimum Replacement Expenditure and the sum of the amounts actually on
deposit with manager to be used for Recurring Replacement Expenditures pursuant to the Management
Agreement together with the sums that Borrower and/or Manager on behalf of Borrower has incurred
and paid for Recurring Replacement Expenditures but in no event more than the sums on deposit in
the Central Account on such Payment Date less sums allocated pursuant to clause (i) — (iv) of
Section 5.05(a) hereof (the “Required RRE Shortfall”).

     “Recurring Replacement Reserve Sub-Account” shall mean the Sub-Account of the Central
Account established pursuant to Section 5.02 hereof into which the Recurring Replacement Reserve
Monthly Installment shall be deposited.

     “Regulation AB” shall mean Regulation AB under the Securities Act and the Securities
Exchange Act of 1934 (as amended).

     “Release” shall have the meaning set forth in Section 15.02 hereof.

     “Release Price Percentage” shall mean the percentage for each Cross-collateralized
Property set forth on Exhibit C annexed hereto and made a part hereof.

     “Rents” shall have the meaning set forth in granting clause (f) of this Security
Instrument.

     “Rent Roll” shall have the meaning set forth in Section 2.05 (o) hereof.

     “Required Debt Service Coverage” shall mean a Debt Service Coverage of not less than
1.0:1.

     “Required Debt Service Payment” shall mean, as of any Payment Date, the amount of
interest and principal then due and payable pursuant to the Note, together with any other sums due
thereunder, including, without limitation, any prepayments required to be made or for which notice
has been given (and not revoked in writing in accordance with Section 15.01 hereof) under this
Security Instrument, Default Rate Interest and premium, if any, paid in accordance therewith.

     “Required Engineering Work” shall mean the immediate engineering and/or environmental
remediation work set forth on Exhibit D attached hereto and made a part hereof.

     “Retention Amount” shall have the meaning set forth in Section 3.04(b)(vii) hereof.

     “RevPAR” shall mean the average revenues per available room per day.

     “RevPAR Yield Index” shall mean the percentage amount determined by dividing the
RevPAR of the Property by the RevPAR of the Property’s Competitive Set as determined by Smith
Travel Research (“STR”) or if STR is no longer publishing, a successor reasonably
acceptable to Lender.

     “Scheduled Defeasance Payments” shall mean:

     (a) with respect to a defeasance of the Loan in whole, payments on or prior to, but as
close as possible to (i) each scheduled Payment Date, after the date of defeasance and
through and including the Lockout Expiration Date, upon which interest payments or interest
and Principal Payments are required under the Loan Documents and in amounts equal to the
scheduled payments due on such dates under the Loan Documents and (ii) the Lockout
Expiration Date, of the Principal Amount and any accrued and unpaid interest thereon; or

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     (b) with respect to any defeasance of the Loan in part, payments on or prior to, but as
close as possible to, (i) each scheduled Payment Date after the date of defeasance through
and including the Lockout Expiration Date, of a proportionate share (based on the percentage
of outstanding principal prior to the defeasance represented by the amount of principal
defeased) of the monthly installments of principal and interest due on such dates under the
Loan Documents and (ii) the Lockout Expiration Date, of the unpaid portion of the portion of
the Principal Amount so defeased and any accrued and unpaid interest thereon.

     (c) with respect to any defeasance of the Loan in part which is made in connection
with a Release pursuant to Section 15.02 hereof, payments on or prior to, but as close as
possible to, (i) each scheduled Payment Date after the date of defeasance through and
including the Lockout Expiration Date, of a proportionate share (based on the percentage of
outstanding principal prior to the defeasance represented by the Release Price) of the
monthly installments of principal and interest due on such dates under the Loan Documents
and (ii) the Lockout Expiration Date, of the Release Price and any accrued and unpaid
interest thereon.

     “Securities Act” shall mean the Securities Act of 1933, as the same shall be amended
from time to time.

     “Securitization” shall mean a public or private offering of securities by Lender or
any of its Affiliates or their respective successors and assigns which are collateralized, in whole
or in part, by this Security Instrument.

     “Security Agreement” shall have the meaning set forth in Section 15.01 hereof.

     “Security Instrument” shall mean this Security Instrument as originally executed or as
it may hereafter from time to time be supplemented, amended, modified or extended by one or more
indentures supplemental hereto.

     “Significant Obligor” shall have the meaning set forth in Item 1101(k) of Regulation
AB.

     “Single Purpose Entity” shall mean a corporation, partnership, joint venture, limited
liability company, trust or unincorporated association, which is formed or organized solely for the
purpose of holding, directly, an ownership interest in the Property or, with respect to General
Partner, holding an ownership interest in and managing a Person which holds an ownership interest
in the Property, or, with respect to Operating Tenant, holding a interest in the Property, does not
engage in any business unrelated to, with respect to Borrower, the Property and, with respect to
General Partner, its interest in Borrower or, in the case of a General Partner of the Operating
Tenant, its interest in the Operating Tenant, does not have any assets other than those related to,
with respect to Borrower, its interest in the Property and, with respect to General Partner, its
interest in Borrower, in the case of a General Partner of the Operating Tenant, its interest in the
Operating Tenant, or any indebtedness other than as permitted by this Security Instrument or the
other Loan Documents, has its own separate books and records and has its own accounts, in each case
which are separate and apart from the books and records and accounts of any other Person, holds
itself out as being a Person separate and apart from any other Person and which otherwise satisfies
the criteria of the Rating Agency, as in effect on the Closing Date, for a special-purpose
bankruptcy-remote entity.

     “Solvent” shall mean, as to any Person, that (a) the sum of the assets of such Person,
at a fair valuation, exceeds its liabilities, including contingent liabilities, (b) such Person has
sufficient capital with which to conduct its business as presently conducted and as proposed to be
conducted and (c) such Person has not incurred debts, and does not intend to incur debts, beyond
its ability to pay such debts as they mature. For purposes of this definition, “debt”
means any liability on a claim, and “claim” means (a) a right to payment, whether or not
such right is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured,
disputed, undisputed, legal, equitable, secured or unsecured, or (b) a right to an equitable remedy
for breach of performance if such breach gives rise to a payment, whether or not such right to an
equitable remedy is reduced to judgment, fixed, contingent, matured, unmatured, disputed,
undisputed, secured, or unsecured. With respect to any such contingent liabilities, such
liabilities shall be computed in accordance with GAAP at the amount which, in light of all the
facts and circumstances existing at the time, represents the amount which can reasonably be
expected to become an actual or matured liability.

19

 

     “Space Leases” shall mean any Lease or sublease thereunder (including, without
limitation, any Major Space Lease) creating a leasehold right of possession for the use and
occupancy of a portion of the Property as a tenant together with any supplements, renewals,
amendments, modifications or extensions thereof excluding room reservations and other functions
held at the Property, and excluding the Operating Lease.

     “State” shall mean any of the states which are members of the United States of
America.

     “Stated Maturity” when used with respect to the Note or any installment of interest
and/or principal payment thereunder, shall mean the date specified in the Note as the fixed date on
which a payment of all or any portion of principal and/or interest is due and payable.

     “Sub-Accounts” shall have the meaning set forth in Section 5.02 hereof.

     “Substantial Casualty” shall have the meaning set forth in Section 3.04 hereof.

     “Taking” shall mean a condemnation or taking pursuant to the lawful exercise of the
power of eminent domain.

     “TIC” shall have the meaning set forth in Section 2.12.

     “TIC Agreement” shall have the meaning set forth in Section 2.12.

     “Transfer” shall mean the conveyance, assignment, sale, mortgaging, encumbrance,
pledging, hypothecation, granting of a security interest in, granting of options with respect to,
or other disposition of (directly or indirectly, voluntarily or involuntarily, by operation of law
or otherwise, and whether or not for consideration or of record) all or any portion of any legal or
beneficial interest (a) in all or any portion of the Property; (b) if Borrower is a corporation or,
if Borrower is a partnership and any General Partner is a corporation, in the stock of Borrower or
any General Partner; (c) in Borrower (or any trust of which Borrower is a trustee); or (d) if
Borrower is a limited or general partnership, joint venture, limited liability company, trust,
nominee trust, tenancy in common or other unincorporated form of business association or form of
ownership interest, in any Person having a legal or beneficial ownership in Borrower, excluding any
legal or beneficial interest in any constituent limited partner, if Borrower is a limited
partnership, or in any non-managing member, if Borrower is a limited liability company, unless such
interest would, or together with all other direct or indirect interests in Borrower which were
previously transferred, aggregate 49% or more of the partnership or membership, as applicable,
interest in Borrower or would result in any Person who, as of the Closing Date, did not own,
directly or indirectly, 49% or more of the partnership or membership, as applicable, interest in
Borrower, owning, directly or indirectly, 49% or more of the partnership or membership, as
applicable, interest in Borrower and excluding any legal or beneficial interest in any General
Partner unless such interest would, or together with all other direct or indirect interest in the
General Partner which were previously transferred, aggregate 49% or more of the partnership or
membership, as applicable, interest in the General Partner (or result in a change in control of the
management of the General Partner from the individuals exercising such control immediately prior to
the conveyance or other disposition of such legal or beneficial interest) and shall also include,
without limitation to the foregoing, the following: an installment sales agreement wherein
Borrower agrees to sell the Property or any part thereof or any interest therein for a price to be
paid in installments; an agreement by Borrower leasing all or substantially all of the Property to
one or more Persons pursuant to a single or related transactions, 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 Rent; any instrument subjecting the Property to a condominium regime or
transferring ownership to a cooperative corporation; and the dissolution or termination of Borrower
or the merger or consolidation of Borrower with any other Person.

     “UCC” shall mean the Uniform Commercial Code as in effect on the date hereof in the
State in which the Realty is located; provided, however, that if by reason of mandatory provisions
of law, the perfection or the effect of perfection or non-perfection or priority of the security
interest in any item or portion of the collateral is governed by the Uniform Commercial Code as in
effect in a jurisdiction other than the State in which the Realty is located (“Other UCC
State”), “UCC” means the Uniform Commercial Code as in effect in such Other UCC State
for purposes of the provisions hereof relating to such perfection or effect of perfection or
non-perfection or priority.

20

 

     “Undefeased Note” shall have the meaning set forth in Section 15.01 hereof.

     “Uniform System of Accounts” shall mean the Uniform System of Accounts for the Lodging
Industry, 10th Revised Edition, Educational Institute of the American Hotel and Motel Association
and Hotel Association of New York City (2006), as from time to time amended.

     “Unscheduled Payments” shall mean (a) all Loss Proceeds that Borrower has elected or
is required to apply to the repayment of the Debt pursuant to this Security Instrument, the Note or
any other Loan Documents, (b) any funds representing a voluntary or involuntary principal
prepayment other than scheduled Principal Payments and (c) any Net Proceeds.

     “Use Requirements” shall mean any and all building codes, permits, certificates of
occupancy or compliance, laws, regulations, or ordinances (including, without limitation, health,
pollution, fire protection, medical and day-care facilities, waste product and sewage disposal
regulations), restrictions of record, easements, reciprocal easements, declarations or other
agreements affecting the use of the Property or any part thereof.

     “Welfare Plan” shall mean an employee welfare benefit plan as defined in Section 3(1)
of ERISA established or maintained by Borrower, Guarantor or any ERISA Affiliate or that covers any
current or former employee of Borrower, Guarantor or any ERISA Affiliate.

     “Work” shall have the meaning set forth in Section 3.04(a)(i) hereof.

ARTICLE II: REPRESENTATIONS, WARRANTIES

AND COVENANTS OF BORROWER

     Section 2.01. Payment of Debt. Borrower will pay the Debt at the time and in the
manner provided in the Note and the other Loan Documents, all in lawful money of the United States
of America in immediately available funds.

     Section 2.02. Representations, Warranties and Covenants of Borrower. Borrower
represents and warrants to and covenants with Lender:

          (a) Organization and Authority. Borrower (i) is a limited liability company, general
partnership, limited partnership or corporation, as the case may be, duly organized, validly
existing and in good standing under the laws of the jurisdiction of its formation, (ii) has all
requisite power and authority and all necessary licenses and permits to own and operate the
Property and to carry on its business as now conducted and as presently proposed to be conducted
and (iii) is duly qualified, authorized to do business and in good standing in the jurisdiction
where the Property is located and in each other jurisdiction where the conduct of its business or
the nature of its activities makes such qualification necessary. If Borrower is a limited
liability company, limited partnership or general partnership, each general partner or managing
member, as applicable, of Borrower which is a corporation is duly organized, validly existing, and
in good standing under the laws of the jurisdiction of its incorporation.

          (b) Power. Borrower and, if applicable, each General Partner has full power and
authority to execute, deliver and perform, as applicable, the Loan Documents to which it is a
party, to make the borrowings thereunder, to execute and deliver the Note and to grant to Lender a
first, prior, perfected and continuing lien on and security interest in the Property, subject only
to the Permitted Encumbrances.

          (c) Authorization of Borrowing. The execution, delivery and performance of the Loan
Documents to which Borrower is a party, the making of the borrowings thereunder, the execution and
delivery of the Note, the grant of the liens on the Property pursuant to the Loan Documents to
which Borrower is a party and the consummation of the Loan are within the powers of Borrower and
have been duly authorized by Borrower and, if applicable, the General Partners, by all requisite
action (and Borrower hereby represents that no approval or action which has not already been
obtained of any member, limited partner or shareholder, as applicable, of Borrower is

21

 

required to authorize any of the Loan Documents to which Borrower is a party) and will
constitute the legal, valid and binding obligation of Borrower, enforceable against Borrower in
accordance with their terms, except as enforcement may be stayed or limited by bankruptcy,
insolvency or similar laws affecting the enforcement of creditors’ rights generally and by general
principles of equity (whether considered in proceedings at law or in equity) and will not (i)
violate any provision of its partnership agreement or partnership certificate or certificate of
incorporation or by-laws, or operating agreement, certificate of formation or articles of
organization, as applicable, or, to its knowledge, any law, judgment, order, rule or regulation of
any court, arbitration panel or other Governmental Authority, domestic or foreign, or other Person
affecting or binding upon Borrower or the Property, or (ii) violate any provision of any indenture,
agreement, mortgage, deed of trust, contract or other instrument to which Borrower or, if
applicable, any General Partner is a party or by which any of their respective property, assets or
revenues are bound, or be in conflict with, result in an acceleration of any obligation or a breach
of or constitute (with notice or lapse of time or both) a default or require any payment or
prepayment under, any such indenture, agreement, mortgage, deed of trust, contract or other
instrument, or (iii) result in the creation or imposition of any lien, except those in favor of
Lender as provided in the Loan Documents to which it is a party.

          (d) Consent. Neither Borrower nor, if applicable, any General Partner, is required to
obtain any consent, approval or authorization from, or to file any declaration or statement with,
any Governmental Authority or other agency in connection with or as a condition to the execution,
delivery or performance of this Security Instrument, the Note or the other Loan Documents which has
not been so obtained or filed.

          (e) Interest Rate. The rate of interest paid under the Note and the method and manner
of the calculation thereof do not violate any usury or other law or applicable Legal Requirement.

          (f) Other Agreements. Borrower is not a party to nor is otherwise bound by any
agreements or instruments which, individually or in the aggregate, are reasonably likely to have a
Material Adverse Effect. Neither Borrower nor, if applicable, any General Partner, is in violation
of its organizational documents or other restriction or any agreement or instrument by which it is
bound, or any judgment, decree, writ, injunction, order or award of any arbitrator, court or
Governmental Authority, or any Legal Requirement, in each case, applicable to Borrower or the
Property, except for such violations that would not have a Material Adverse Effect.

          (g) Maintenance of Existence. (i) Borrower is familiar with the criteria of the
Rating Agency required to qualify as a special-purpose bankruptcy-remote entity and Borrower,
Operating Tenant and, if applicable, each General Partner at all times since their formation have
been duly formed and existing at all times and at all times have preserved and shall preserve and
has kept and shall keep in full force and effect their existence as a Single Purpose Entity.

     (ii) Borrower, Operating Tenant and, if applicable, each General Partner, at all times
since their organization have complied, and will continue to comply in all material
respects, with the provisions of its certificate of limited partnership and agreement of
limited partnership or certificate of incorporation and by-laws or articles of organization,
certificate of formation and operating agreement, as applicable, and the laws of its
jurisdiction of organization relating to partnerships, corporations or limited liability
companies, as applicable.

     (iii) Borrower, Operating Tenant and, if applicable, each General Partner have done or
caused to be done and will do all things reasonably necessary to observe organizational
formalities and preserve their existence and Borrower, Operating Tenant and, if applicable,
each General Partner will not hereafter amend, modify or otherwise change the certificate of
limited partnership and agreement of limited partnership or certificate of incorporation and
by-laws or articles of organization, certificate of formation and operating agreement, as
applicable, or other organizational documents of Borrower, Operating Tenant and, if
applicable, each General Partner, except for non-material amendments which do not modify the
Single Purpose Entity provisions.

     (iv) Borrower, Operating Tenant and, if applicable, each General Partner, have at all
times accurately maintained, and will continue to accurately maintain in all material
respects, their respective

22

 

financial statements, accounting records and other partnership, company or corporate
documents separate from those of any other Person and Borrower, Operating Tenant and/or, if
applicable, General Partner, have filed and will file its own tax returns or, if Borrower,
Operating Tenant and/or, if applicable, General Partner is part of a consolidated group for
purposes of filing tax returns, Borrower, Operating Tenant and, General Partner, as
applicable, have been shown and will be shown as separate members of such group. Borrower,
Operating Tenant and, if applicable, each General Partner have not at any time since their
formation commingled, and will not commingle, their respective assets with those of any
other Person and each has maintained and will maintain their assets in such a manner such
that it will not be costly or difficult to segregate, ascertain or identify their individual
assets from those of any other Person. Borrower, Operating Tenant and, if applicable, each
General Partner has not permitted and will not permit any Affiliate independent access to
their bank accounts. Borrower, Operating Tenant and, if applicable, each General Partner
have at all times since their formation accurately maintained and utilized, and will
continue to accurately maintain and utilize, their own separate bank accounts, payroll and
separate books of account, stationery, invoices and checks.

     (v) Borrower, Operating Tenant and, if applicable, each General Partner, have at all
times paid, and will continue to pay, their own liabilities from their own separate assets
and each has allocated and charged and shall each allocate and charge fairly and reasonably
any overhead which Borrower, Operating Tenant and, if applicable, any General Partner,

shares with any other Person, including, without limitation, for office space and services
performed by any employee of another Person.

     (vi) Borrower, Operating Tenant and, if applicable, each General Partner, have at all
times identified themselves, and will continue to identify themselves, in all dealings with
the public, under their own names and as separate and distinct entities and have corrected
and shall correct any known misunderstanding regarding their status as separate and distinct
entities. Borrower, Operating Tenant and, if applicable, each General Partner, have not at
any time identified themselves, and will not identify themselves, as being a division of any
other Person.

     (vii) Borrower, Operating Tenant and, if applicable, each General Partner, have been at
all times, and will continue to be, adequately capitalized in light of the nature of their
respective businesses.

     (viii) Borrower, Operating Tenant and, if applicable, each General Partner, (A) have not
owned, do not own and will not own any assets or property other than, with respect to
Borrower, the Property and any incidental personal property necessary for the ownership,
management or operation of the Property or, with respect to Operating Tenant, its leasehold
interest in the Property, and, with respect to General Partner, if applicable, its interest
in Borrower or, with respect to a General Partner of Operating Tenant, its interest in
Operating Tenant, (B) have not engaged and will not engage in any business other than, with
respect to Borrower, the ownership, management and operation of the Property, or with
respect to Operating Tenant, its interest in the Property, or, with respect to General
Partner, if applicable, its interest in Borrower or, with respect to a General Partner of
Operating Tenant, its interest in Operating Tenant, (C) have not incurred any outstanding
debt as of the date hereof, and will not incur any debt, secured or unsecured, direct or
contingent (including guaranteeing any obligation), other than, with respect to Borrower,
(W) the Loan, (X) unsecured trade and operational debt which (1) is not evidenced by a note,
(2) is incurred in the ordinary course of the operation of the Property, (3) does not,
together with any equipment financing incurred pursuant to clause (Y) hereof exceed in the
aggregate two percent (2%) of the Allocated Loan Amount for the Property and (4) is, unless
being contested in accordance with the terms of this Security Instrument, paid prior to the
earlier to occur of the sixtieth (60th) day after the date incurred and the date when due,
(Y) equipment financing relating to equipment used in connection with the operation of the
Property which (1) is incurred in the ordinary course of the operation of the Property and
(2) does not, together with any unsecured trade and operational debt incurred pursuant to
clause (X) hereof, exceed in the aggregate two percent (2%) of the Allocated Loan Amount and
(Z) contingent obligations to repay customer, membership and security deposits held in the
ordinary course of Borrower’s business, (D) have not pledged (other than pledges which have
been released which were given in connection with obligations which have been paid in full)
and will not pledge their assets for the benefit of any other

23

 

Person, and (E) have not made and will not make any loans or advances to any Person
(including any Affiliate).

     (ix) None of Borrower, Operating Tenant nor, if applicable, any General Partner will
hereafter change its name or principal place of business.

     (x) None of Borrower, Operating Tenant nor, if applicable, any General Partner has,
and neither of such Persons will have, any subsidiaries (other than, with respect to General
Partner, Borrower or, with respect to General Partner of Operating Tenant, Operating
Tenant).

     (xi) Borrower has preserved and maintained and will preserve and maintain its existence
as a Delaware limited partnership or a Delaware limited liability company, as applicable,
and all material rights, privileges, tradenames and franchises and Operating Tenant has
preserved and maintained and will preserve and maintain its existence as a Delaware limited
partnership and all material rights, privileges, tradenames and franchises. General
Partner, if applicable, has preserved and maintained and will preserve and maintain its
existence as a Delaware limited liability company and all material rights, privileges,
tradenames and franchises.

     (xii) None of Borrower, Operating Tenant nor, if applicable, any General Partner, has
merged or consolidated with, and none will merge or consolidate with, and none has sold all
or substantially all of its respective assets to any Person, and none will sell all or
substantially all of its respective assets to any Person, and none has liquidated, wound up
or dissolved itself (or suffered any liquidation, winding up or dissolution) and none will
liquidate, wind up or dissolve itself (or suffer any liquidation, winding up or
dissolution). None of Borrower, Operating Tenant nor, if applicable, any General Partner
has acquired nor will acquire any business or assets from, or capital stock or other
ownership interest of, or be a party to any acquisition of, any Person (other than, with
respect to General Partner, if applicable, its interest in Borrower and Operating Tenant).

     (xiii) Borrower, Operating Tenant and, if applicable, each General Partner, have not at
any time since their formation assumed, guaranteed or held themselves out to be responsible
for, and will not assume, guarantee or hold themselves out to be responsible for the
liabilities or the decisions or actions respecting the daily business affairs of their
partners, shareholders or members or any predecessor company, corporation or partnership,
each as applicable, any Affiliates, or any other Persons other than the Loan and other loans
which have been paid in full, and liens granted thereunder fully discharged, prior to the
date hereof. None of Borrower, Operating Tenant nor, if applicable, each General Partner,
have at any time since its formation acquired, and will not acquire, obligations or
securities of its partners or shareholders, members or any predecessor company, corporation
or partnership, each as applicable, or any Affiliates (other than, with respect to General
Partner, its interest in Borrower or, with respect to General Partner of Operating Tenant,
its interest in Operating Tenant). Borrower, Operating Tenant and, if applicable, each
General Partner, have not at any time since their formation made, and will not make, loans
to its partners, members or shareholders or any predecessor company, corporation or
partnership, each as applicable, or any Affiliates of any of such Persons. Borrower,
Operating Tenant and, if applicable, each General Partner, have no known material contingent
liabilities nor do they have any material financial liabilities under any indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument to which such
Person is a party or by which it is otherwise bound other than under the Loan Documents.

     (xiv) Neither Borrower nor Operating Tenant nor, if applicable, General Partner, has
at any time since its formation entered into and was not a party to, and, will not enter
into or be a party to, any transaction with its Affiliates, members, partners or
shareholders, as applicable, or any Affiliates thereof except in the ordinary course of
business of such Person on terms which are no less favorable to such Person than would be
obtained in a comparable arm’s length transaction with an unrelated third party.

     (xv) If Borrower or Operating Tenant is a limited partnership, the General Partner
shall be a corporation or limited liability company whose sole asset is its interest in
Borrower or Operating Tenant, as

24

 

applicable, and the General Partner will at all times comply, and will cause Borrower
or Operating Tenant, as applicable, to comply, with each of the representations, warranties,
and covenants contained in this Section 2.02(g) as if such representation, warranty or
covenant was made directly by such General Partner.

     (xvi) Borrower and Operating Tenant shall at all times cause there to be at least two
duly appointed members of the board of directors or board of managers or other governing
board or body, as applicable (each, an “Independent Director”), of, if Borrower or
Operating Tenant is a corporation, Borrower or Operating Tenant, as applicable, if Borrower
or Operating Tenant is a limited partnership, of the General Partner, and if Borrower or
Operating Tenant is a limited liability company, of the General Partner or of Borrower or
Operating Tenant, as applicable, reasonably satisfactory to Lender who shall not have been
at the time of such individual’s appointment, and may not be or have been at any time (A) a
shareholder, officer, director, attorney, counsel, partner, member or employee of Borrower,
Operating Tenant or any of the foregoing Persons or Affiliates thereof, (B) a customer or
creditor of, or supplier or service provider to, Borrower or any of its shareholders,
partners, members or their Affiliates, (C) a member of the immediate family of any Person
referred to in (A) or (B) above or (D) a Person Controlling, Controlled by or under common
Control with any Person referred to in (A) through (C) above. A natural person who
otherwise satisfies the foregoing definition except for being the Independent Director of a
Single Purpose Entity Affiliated with Borrower, Operating Tenant or General Partner shall
not be disqualified from serving as an Independent Director if such individual is at the
time of initial appointment, or at any time while serving as the Independent Director, an
Independent Director of a Single Purpose Entity Affiliated with Borrower, Operating Tenant
or General Partner if such individual is an independent director provided by a
nationally-recognized company that provides professional independent directors.

     (xvii) Borrower, Operating Tenant and, if applicable, each General Partner, shall not
cause or permit the board of directors or board of managers or other governing board or
body, as applicable, of Borrower, Operating Tenant or, if applicable, each General Partner,
to take any action which, under the terms of any certificate of incorporation, by-laws,
limited liability company agreement, operating agreement, certificate of formation or
articles of organization requires a vote of the board of directors or board of managers or
other governing board or body of Borrower, Operating Tenant, or, if applicable, the General
Partner and also requires the vote of the Independent Directors therewith, unless at the
time of such action there shall be at least two members who are Independent Directors.

     (xviii) Borrower, Operating Tenant and, if applicable, each General Partner has paid and
shall pay the salaries of their own employees and has maintained and shall maintain a
sufficient number of employees in light of their contemplated business operations.

     (xvix) Borrower and Operating Tenant shall, and shall cause its Affiliates to, and
Borrower and Operating Tenant have and have caused their Affiliates to, conduct its business
so that the assumptions made with respect to Borrower, Operating Tenant and, if applicable,
each General Partner, in that certain opinion letter relating to substantive
non-consolidation dated the date hereof (the “Insolvency Opinion”) delivered in
connection with the Loan has been and shall be true and correct in all respects.

     Notwithstanding anything to the contrary contained in this Section 2.02(g), provided Borrower
or Operating Tenant, as applicable, is a Delaware single member limited liability company which
satisfies the single purpose bankruptcy remote entity requirements of each Rating Agency for a
single member limited liability company, the foregoing provisions of this Section 2.02(g) shall not
apply to the General Partner.

     (h) No Defaults. No Event of Default or, to Borrower’s knowledge, Default has
occurred and is continuing or would occur as a result of the consummation of the transactions
contemplated by the Loan Documents. Borrower is not in default in the payment or performance of
any of its Contractual Obligations in any material respect.

     (i) Consents and Approvals. Borrower and, if applicable, each General Partner, have
obtained or made all necessary (i) consents, approvals and authorizations, and registrations and
filings of or with all

25

 

Governmental Authorities and (ii) consents, approvals, waivers and notifications of partners,
stockholders, members, creditors, lessors and other nongovernmental Persons, in each case, which
are required to be obtained or made by Borrower or, if applicable, the General Partner, in
connection with the execution and delivery of, and the performance by Borrower of its obligations
under, the Loan Documents.

     (j) Investment Company Act Status, etc. Borrower is not (i) an “investment company,”
or a company “controlled” by an “investment company,” as such terms are defined in the Investment
Company Act of 1940, as amended, (ii) a “holding company” or a “subsidiary company” of a “holding
company” or an “affiliate” of either a “holding company” or a “subsidiary company” within the
meaning of the Public Utility Holding Company Act of 1935, as amended, or (iii) subject to any
other federal or state law or regulation which purports to restrict or regulate its ability to
borrow money.

     (k) Compliance with Law. To Borrower’s knowledge, Borrower is in compliance with all
Legal Requirements to which it or the Property is subject, including, without limitation, all
Environmental Statutes (except as previously disclosed in the Environmental Report), the Americans
with Disabilities Act (except as previously disclosed in the engineering report relating to the
Property delivered to Lender in connection with the origination of the Loan), the Occupational
Safety and Health Act of 1970 and ERISA. No portion of the Property has been or will be purchased,
improved, fixtured, equipped or furnished with proceeds of any illegal activity and, to the best of
Borrower’s knowledge, no illegal activities are being conducted at or from the Property.

     (l) Financial Information. All financial data that has been delivered by Borrower to
Lender (i) is true, complete and correct in all material respects, (ii) accurately represents the
financial condition and results of operations in all material respects of the Persons covered
thereby as of the date on which the same shall have been furnished, and (iii) in the case of
audited financial statements, has been prepared in accordance with GAAP and the Uniform System of
Accounts (or such other accounting basis as is reasonably acceptable to Lender) throughout the
periods covered thereby. As of the date hereof, neither Borrower nor, if applicable, any General
Partner, has any material contingent liability, material liability for taxes or other unusual or
forward commitment not reflected in such financial statements delivered to Lender. Since the date
of the last financial statements delivered by Borrower to Lender except as otherwise disclosed in
such financial statements or notes thereto, there has been no change in the assets, liabilities or
financial position of Borrower nor, if applicable, any General Partner, or in the results of
operations of Borrower which would have a Material Adverse Effect. Neither Borrower nor, if
applicable, any General Partner, has incurred any obligation or liability, contingent or otherwise
not reflected in such financial statements which would have a Material Adverse Effect.

     (m) Transaction Brokerage Fees. Borrower has not dealt with any financial advisors,
brokers, underwriters, placement agents, agents or finders in connection with the transactions
contemplated by this Security Instrument. All brokerage fees, commissions and other expenses
payable in connection with the transactions contemplated by the Loan Documents have been paid in
full by Borrower contemporaneously with the execution of the Loan Documents and the funding of the
Loan. Borrower hereby agrees to indemnify and hold Lender harmless for, from and against any and
all claims, liabilities, costs and expenses of any kind in any way relating to or arising from (i)
a claim by any Person that such Person acted on behalf of Borrower in connection with the
transactions contemplated herein or (ii) any breach of the foregoing representation. The
provisions of this subsection (m) shall survive the repayment of the Debt.

     (n) Federal Reserve Regulations. No part of the proceeds of the Loan will be used for
the purpose of “purchasing” or “carrying” any “margin stock” within the meaning of Regulations T, U
or X of the Board of Governors of the Federal Reserve System or for any other purpose which would
be inconsistent with such Regulations T, U or X or any other Regulations of such Board of
Governors, or for any purposes prohibited by Legal Requirements or by the terms and conditions of
the Loan Documents.

     (o) Pending Litigation. There are no actions, suits or proceedings pending or, to the
best knowledge of Borrower, threatened against or affecting Borrower or the Property in any court
or before any Governmental Authority which if adversely determined either individually or
collectively has or is reasonably likely to have a Material Adverse Effect.

26

 

     (p) Solvency; No Bankruptcy. Each of Borrower and, if applicable, the General
Partner, (i) is and has at all times been Solvent and will remain Solvent immediately upon the
consummation of the transactions contemplated by the Loan Documents and (ii) is free from
bankruptcy, reorganization or arrangement proceedings or a general assignment for the benefit of
creditors and is not contemplating the filing of a petition under any state or federal bankruptcy
or insolvency laws or the liquidation of all or a major portion of such Person’s assets or property
and Borrower has no knowledge of any Person contemplating the filing of any such petition against
it or, if applicable, the General Partner. None of the transactions contemplated hereby will be or
have been made with an intent to hinder, delay or defraud any present or future creditors of
Borrower and Borrower has received reasonably equivalent value in exchange for its obligations
under the Loan Documents. Borrower’s assets do not, and immediately upon consummation of the
transaction contemplated in the Loan Documents will not, constitute unreasonably small capital to
carry out its business as presently conducted or as proposed to be conducted. Borrower does not
intend to, nor believes that it will, incur debts and liabilities beyond its ability to pay such
debts as they may mature.

     (q) Use of Proceeds. The proceeds of the Loan shall be applied by Borrower to,
inter alia, (i) purchase the Property and, if applicable, satisfy certain mortgage
loans presently encumbering all or a part of the Property and (ii) pay certain transaction costs
incurred by Borrower in connection with the Loan. No portion of the proceeds of the Loan will be
used for family, personal, agricultural or household use.

     (r) Tax Filings. Borrower and, if applicable, each General Partner, have filed all
federal, state and local tax returns required to be filed and have paid or made adequate provision
for the payment of all federal, state and local taxes, charges and assessments payable by Borrower
and, if applicable, the General Partners. Borrower and, if applicable, the General Partners,
believe that their respective tax returns properly reflect the income and taxes of Borrower and
said General Partner, if any, for the periods covered thereby, subject only to reasonable
adjustments required by the Internal Revenue Service or other applicable tax authority upon audit.

     (s) Not Foreign Person. Borrower is not a “foreign person” within the meaning of
§1445(f)(3) of the Code.

     (t) ERISA. (i) Neither Borrower nor Guarantor is, or is acting on behalf of: (a) an
“employee benefit plan” within the meaning of Section 3(3) of ERISA, that is subject to Part 4 of
Title I of ERISA; (b) a “plan” within the meaning of section 4975(e)(1) of the Code that is subject
to section 4975 of the Code or (c) any other entity that is deemed under applicable law to hold the
assets of a plan described in (a) or (b) and this representation shall be deemed to be continuing
in nature for all periods that this Security Instrument is in effect. Each Plan is in compliance
with, and has been administered in all material respects in compliance with, its terms and the
applicable provisions of ERISA, the Code and any other applicable Legal Requirement, except to the
extent the foregoing could not have a Material Adverse Effect, and no event or condition has
occurred and is continuing as to which Borrower would be under an obligation to furnish a report to
Lender under clause (ii)(A) of this Section. With respect to each Plan maintained or contributed
to by Borrower, Guarantor or any ERISA Affiliate thereof (a) there is no actual or contingent
material liability of Borrower, Guarantor or any ERISA Affiliate under Title IV of ERISA or Section
412 of the Code to any person or entity, including the Pension Benefit Guaranty Corporation, IRS,
any such Plan or participants (or their beneficiaries) in any such Plan (other than the obligation
to pay routine benefit claims when due under the terms of such Plan), (b) the assets of Borrower or
Guarantor have not been subject to a lien under ERISA or the Code and (c) there is no basis for
such material liability or the assertion of any such lien with respect to the assets of Borrower or
Guarantor as the result of or after the consummation of the transactions contemplated by this
Security Instrument. Except to the extent the following could not have a Material Adverse Effect,
no Welfare Plan provides or will provide benefits, including, without limitation, death or medical
benefits (whether or not insured) with respect to any current or former employee of Borrower or
Guarantor beyond his or her retirement or other termination of service other than (A) coverage
mandated by applicable law, (B) death or disability benefits that have been fully provided for by
fully paid up insurance or (C) severance benefits.

     (ii) Borrower will furnish to Lender as soon as possible, and in any event within ten
(10) days after Borrower knows or has reason to believe that any of the events or conditions
specified below with respect to any Plan, Welfare Plan or Multiemployer Plan has occurred or
exists, an Officer’s

27

 

Certificate setting forth details respecting such event or condition and the action, if
any, that Borrower or its ERISA Affiliate proposes to take with respect thereto (and a copy
of any report or notice required to be filed with or given to PBGC (or any other relevant
Governmental Authority)) by Borrower or an ERISA Affiliate with respect to such event or
condition, if such report or notice is required to be filed with the PBGC or any other
relevant Governmental Authority:

     (A) any reportable event, as defined in Section 4043 of ERISA and the
regulations issued thereunder, with respect to a Plan, as to which PBGC has not by
regulation waived the requirement of Section 4043(a) of ERISA that it be notified
within thirty (30) days of the occurrence of such event (provided that a failure to
meet the minimum funding standard of Section 412 of the Code and of Section 302 of
ERISA, including, without limitation, the failure to make on or before its due date
a required installment under Section 412(m) of the Code and of Section 302(e) of
ERISA, shall be a reportable event regardless of the issuance of any waivers in
accordance with Section 412(d) of the Code), and any request for a waiver under
Section 412(d) of the Code for any Plan;

     (B) the distribution under Section 4041 of ERISA of a notice of intent to
terminate any Plan or any action taken by Borrower or an ERISA Affiliate to
terminate any Plan;

     (C) the institution by PBGC of proceedings under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any Plan, or the
receipt by Borrower or any ERISA Affiliate of a notice from a Multiemployer Plan
that such action has been taken by PBGC with respect to such Multiemployer Plan;

     (D) the complete or partial withdrawal from a Multiemployer Plan by Borrower or
any ERISA Affiliate that results in material liability under Section 4201 or 4204 of
ERISA (including the obligation to satisfy secondary liability as a result of a
purchaser default) or the receipt by Borrower or any ERISA Affiliate of notice from
a Multiemployer Plan that it is in reorganization or insolvency pursuant to Section
4241 or 4245 of ERISA or that it intends to terminate or has terminated under
Section 4041A of ERISA;

     (E) the institution of a proceeding by a fiduciary of any Multiemployer Plan
against Borrower or any ERISA Affiliate to enforce Section 515 of ERISA, which
proceeding is not dismissed within thirty (30) days;

     (F) the adoption of an amendment to any Plan that, pursuant to Section
401(a)(29) of the Code or Section 307 of ERISA, would result in the loss of
tax-exempt status of the trust of which such Plan is a part if Borrower or an ERISA
Affiliate fails to timely provide security to the Plan in accordance with the
provisions of said Sections;

     (G) the imposition of a lien or a security interest in connection with a Plan;
or

     (H) Borrower or Guarantor permits any Welfare Plan to provide benefits,
including without limitation, medical benefits (whether or not insured), with
respect to any current or former employee of Borrower or Guarantor beyond his or her
retirement or other termination of service other than (1) coverage mandated by
applicable law, (2) death or disability benefits that have been fully provided for
by paid up insurance or otherwise or (3) severance benefits.

     (iii) Borrower shall not knowingly engage in or permit any transaction in connection
with which Borrower or Guarantor could be subject to either a material civil penalty or tax
assessed pursuant to Section 502(i) or 502(l) of ERISA or Section 4975 of the Code, to the
extent it could have a Material Adverse Effect, permit any Welfare Plan to provide benefits,
including without limitation, medical benefits (whether or not insured), with respect to any
current or former employee of Borrower or Guarantor beyond

28

 

his or her retirement or other termination of service other than (A) coverage mandated
by applicable law, (B) death or disability benefits that have been fully provided for by
paid up insurance or otherwise or (C) severance benefits, permit the assets of Borrower or
Guarantor to become “plan assets”, as defined under ERISA Section 3(42) and regulations
promulgated thereunder or, to the extent it could have a Material Adverse Effect, adopt,
amend (except as may be required by applicable law) or increase the amount of any benefit or
amount payable under, or permit any ERISA Affiliate to adopt, amend (except as may be
required by applicable law) or increase the amount of any benefit or amount payable under,
any employee benefit plan (including, without limitation, any employee welfare benefit plan)
or other plan, policy or arrangement, except for normal increases in the ordinary course of
business consistent with past practice that, in the aggregate, do not result in a material
increase in benefits expense to Borrower, Guarantor or any ERISA Affiliate.

     (u) Labor Matters. No organized work stoppage or labor strike is pending or
threatened by employees or other laborers at the Property and neither Borrower nor Manager (i) is
involved in or threatened with any labor dispute, grievance or litigation relating to labor matters
involving any employees and other laborers at the Property, including, without limitation,
violation of any federal, state or local labor, safety or employment laws (domestic or foreign)
and/or charges of unfair labor practices or discrimination complaints; (ii) has engaged in any
unfair labor practices within the meaning of the National Labor Relations Act or the Railway Labor
Act; or (iii) except to the extent previously disclosed to Lender in writing, is a party to, or
bound by, any collective bargaining agreement or union contract with respect to employees and other
laborers at the Property and no such agreement or contract is currently being negotiated by
Borrower, Manager or any of their Affiliates.

     (v) Borrower’s Legal Status. Borrower’s exact legal name that is indicated on the
signature page hereto, organizational identification number and place of business or, if more than
one, its chief executive office, as well as Borrower’s mailing address, if different, which were
identified by Borrower to Lender and contained in this Security Instrument, are true, accurate and
complete. Borrower (i) will not change its name, its place of business or, if more than one place
of business, its chief executive office, or its mailing address or organizational identification
number if it has one without giving Lender at least thirty (30) days prior written notice of such
change, (ii) if Borrower does not have an organizational identification number and later obtains
one, Borrower shall promptly notify Lender of such organizational identification number and (iii)
will not change its type of organization, jurisdiction of organization or other legal structure.

     (w) Compliance with Anti-Terrorism, Embargo and Anti-Money Laundering Laws. (i) None
of Borrower, General Partner, any Guarantor, or any Person who owns any equity interest in or
Controls Borrower, General Partner or any Guarantor currently is identified on the OFAC List or
otherwise qualifies as a Prohibited Person, and Borrower has implemented procedures, approved by
Borrower and, if applicable, General Partner, to ensure that no Person who now or hereafter owns an
equity interest in Borrower or General Partner is a Prohibited Person or Controlled by a Prohibited
Person, (ii) no proceeds of the Loan will be used to fund any operations in, finance any
investments or activities in or make any payments to, Prohibited Persons, and (iii) none of
Borrower, General Partner, or any Guarantor is in violation of any Legal Requirements relating to
anti-money laundering or anti-terrorism, including, without limitation, Legal Requirements related
to transacting business with Prohibited Persons or the requirements of the Uniting and
Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism
Act of 2001, U.S. Public Law 107-56, and the related regulations issued thereunder, including
temporary regulations, all as amended from time to time. Notwithstanding the foregoing, with
respect to the holders of shares in publicly traded corporations which hold an equity interest in
Borrower, General Partner or Guarantor and which holders of shares in publicly traded corporations
do not Control Borrower, General Partner or Guarantor, the representations contained in clauses (i)
and (iii) of the preceding sentence are made to the knowledge of Borrower. No tenant at the
Property currently is identified on the OFAC List or otherwise qualifies as a Prohibited Person,
and, to the best of Borrower’s knowledge, no tenant at the Property is owned or Controlled by a
Prohibited Person. Borrower has determined that Manager has implemented procedures, approved by
Borrower, to ensure that no tenant at the Property is a Prohibited Person or owned or Controlled by
a Prohibited Person.

     Section 2.03. 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, mortgages or deeds of

29

 

trust, as applicable, 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, given, granted,
bargained, sold, alienated, enfeoffed, conveyed, confirmed, pledged, assigned and hypothecated, or
which Borrower may be or may hereafter become bound to convey or assign to Lender, or for carrying
out or facilitating the performance of the terms of this Security Instrument or for filing,
registering or recording this Security Instrument and, on demand, will execute and deliver and
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, chattel mortgages or
comparable security instruments to evidence more effectively the lien hereof upon the Property.
Borrower grants to Lender an irrevocable power of attorney coupled with an interest for the purpose
of protecting, perfecting, preserving and realizing upon the interests granted pursuant to this
Security Instrument and to effect the intent hereof, all as fully and effectually as Borrower might
or could do; and Borrower hereby ratifies all that Lender shall lawfully do or cause to be done by
virtue hereof; provided, however, that Lender shall not exercise such power of attorney unless and
until Borrower fails to take the required action within the five (5) Business Day time period
stated above unless the failure to so exercise, could, in Lender’s reasonable judgment, result in a
Material Adverse Effect. Upon (a) 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, (b) receipt of an indemnity of Lender related to losses resulting solely from the issuance
of a replacement note or other applicable Loan Document and (c) in the case of any such mutilation,
upon surrender and cancellation of such Note or other applicable Loan Document, Borrower will
issue, in lieu thereof, a replacement Note or other applicable 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.

     Section 2.04. Recording of Security Instrument, etc. Borrower forthwith upon the
execution and delivery of this Security Instrument and thereafter, from time to time, will cause
this Security Instrument, and any security instrument 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 protect the lien or security interest hereof
upon, and the interest of Lender in, the Property. Borrower will pay all filing, registration or
recording fees, and all expenses incident to the preparation, execution and acknowledgment of this
Security Instrument, any mortgage or deed of trust, as applicable, supplemental hereto, any
security instrument with respect to the Property and any instrument of further assurance, 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 Security Instrument, any mortgage or
deed of trust, as applicable, supplemental hereto, any security instrument with respect to the
Property or any instrument of further assurance, except where prohibited by law to do so, in which
event Lender may declare the Debt to be immediately due and payable. Borrower shall hold harmless
and indemnify Lender and its successors and assigns, against any liability incurred as a result of
the imposition of any tax on the making and recording of this Security Instrument.

     Section 2.05. Representations, Warranties and Covenants Relating to the Property.
Borrower represents and warrants to and covenants with Lender with respect to the Property as
follows:

     (a) Lien Priority. This Security Instrument is a valid and enforceable first lien on
the Property, free and clear of all encumbrances and liens having priority over the lien of this
Security Instrument, except for the items set forth as exceptions to or subordinate matters in the
title insurance policy insuring the lien of this Security Instrument, none of which, individually
or in the aggregate, materially interfere with the benefits of the security intended to be provided
by this Security Instrument, materially affect the value or marketability of the Property, impair
the use or operation of the Property for the use currently being made thereof or impair Borrower’s
ability to pay its obligations in a timely manner (such items being the “Permitted
Encumbrances”).

     (b) Title. Borrower has, subject only to the Permitted Encumbrances, good, insurable
and marketable fee simple title to the Premises, Improvements and Fixtures (collectively, the
“Realty”) and to all easements and rights benefiting the Realty and has the right, power
and authority to mortgage, encumber, give, grant, bargain, sell, alien, enfeoff, convey, confirm,
pledge, assign, and hypothecate the Property. Borrower will preserve its interest in and title to
the Property, subject to the Permitted Encumbrances and will forever warrant and defend the same to

30

 

Lender against any and all other claims made by, through or under Borrower and will forever
warrant and defend the validity and priority of the lien and security interest created herein
against the claims of all Persons whomsoever claiming by, through or under Borrower. The foregoing
warranty of title shall survive the foreclosure of this Security Instrument and shall inure to the
benefit of and be enforceable by Lender in the event Lender acquires title to the Property pursuant
to any foreclosure. In addition, there are no outstanding options or rights of first refusal to
purchase the Property or Borrower’s ownership thereof.

     (c) Taxes and Impositions. All taxes and other Impositions and governmental
assessments due and owing in respect of, and affecting, the Property have been paid. Borrower has
paid all Impositions which constitute special governmental assessments in full, except for those
assessments which are permitted by applicable Legal Requirements to be paid in installments, in
which case all installments which are due and payable have been paid in full. There are no
pending, or to Borrower’s best knowledge, proposed special or other assessments for public
improvements or otherwise affecting the Property, nor are there any contemplated improvements to
the Property that may result in such special or other assessments.

     (d) Casualty; Flood Zone. The Realty is in good repair and free and clear of any
damage, destruction or casualty (whether or not covered by insurance) that would materially affect
the value of the Realty or the use for which the Realty was intended, there exists no structural or
other material defects or damages in or to the Property and Borrower has not received any written
notice from any insurance company or bonding company of any material defect or inadequacies in the
Property, or any part thereof, which would materially and adversely affect the insurability of the
same or cause the imposition of extraordinary premiums or charges thereon or of any termination or
threatened termination of any policy of insurance or bond. Except as disclosed on the survey of
the Premises delivered to Lender in connection with the origination of the Loan, no portion of the
Premises is located in an “area of special flood hazard,” as that term is defined in the
regulations of the Federal Insurance Administration, Department of Housing and Urban Development,
under the National Flood Insurance Act of 1968, as amended (24 CFR § 1909.1) or Borrower has
obtained the flood insurance required by Section 3.01(a)(vi) hereof. The Premises either does not
lie in a 100 year flood plain that has been identified by the Secretary of Housing and Urban
Development or any other Governmental Authority or, if it does, Borrower has obtained the flood
insurance required by Section 3.01(a)(vi) hereof.

     (e) Completion; Encroachment. All Improvements necessary for the efficient use and
operation of the Premises, including, without limitation, all Improvements which were included for
purposes of determining the appraised value of the Property in the Appraisal, have been completed
and, except as disclosed on the survey of the Premises delivered to Lender in connection with the
origination of the Loan, none of said Improvements lie outside the boundaries and building
restriction lines of the Premises. Except as disclosed on the survey of the Premises delivered to
Lender in connection with the origination of the Loan and as set forth in the title insurance
policy insuring the lien of this Security Instrument, no improvements on adjoining properties
encroach upon the Premises.

     (f) Separate Lot. The Premises are taxed separately without regard to any other real
estate and constitute a legally subdivided lot under all applicable Legal Requirements (or, if not
subdivided, no subdivision or platting of the Premises is required under applicable Legal
Requirements), and for all purposes may be mortgaged, encumbered, conveyed or otherwise dealt with
as an independent parcel. The Property does not benefit from any tax abatement or exemption.

     (g) Use. Except as previously disclosed in the zoning report relating to the Premises
delivered to Lender in connection with the origination of the Loan, the existence of all
Improvements, the present use and operation thereof and the access of the Premises and the
Improvements to all of the utilities and other items referred to in paragraph (k) below are in
compliance in all material respects with all Leases affecting the Property. Borrower has not
received any notice from any Governmental Authority alleging any uncured violation relating to the
Property of any applicable Legal Requirements.

     (h) Licenses and Permits. Borrower currently holds and will continue to hold all
certificates of occupancy, licenses, registrations, permits, consents, franchises and approvals of
any Governmental Authority or any other Person which are material for the lawful occupancy and
operation of the Realty or which are material to

31

 

the ownership or operation of the Property or the conduct of Borrower’s business. All such
certificates of occupancy, licenses, registrations, permits, consents, franchises and approvals are
current and in full force and effect.

     (i) Environmental Matters. Borrower has received and reviewed the Environmental
Report and has no reason to believe that the Environmental Report contains any untrue statement of
a material fact or omits to state a material fact necessary to make the statements contained
therein or herein, in light of the circumstances under which such statements were made, not
misleading.

     (j) Property Proceedings. There are no actions, suits or proceedings pending or, to
Borrower’s best knowledge, threatened in any court or before any Governmental Authority or
arbitration board or tribunal (i) relating to (A) the zoning of the Premises or any part thereof,
(B) any certificates of occupancy, licenses, registrations, permits, consents or approvals issued
with respect to the Property or any part thereof, (C) the condemnation of the Property or any part
thereof, or (D) the condemnation or relocation of any roadways abutting the Premises required for
access or the denial or limitation of access to the Premises or any part thereof from any point of
access to the Premises, (ii) asserting that (A) any such zoning, certificates of occupancy,
licenses, registrations, permits, consents and/or approvals do not permit the operation of any
material portion of the Realty as presently being conducted, (B) any material improvements located
on the Property or any part thereof cannot be located thereon or operated with their intended use
or (C) the operation of the Property or any part thereof is in violation in any material respect of
any Environmental Statutes, Development Laws or other Legal Requirements or Space Leases or
Property Agreements or (iii) which might (A) affect the validity or priority of any Loan Document
or (B) have a Material Adverse Effect. Borrower is not aware of any facts or circumstances which
may give rise to any actions, suits or proceedings described in the preceding sentence.

     (k) Utilities. The Premises has all necessary legal access to water, gas and
electrical supply, storm and sanitary sewerage facilities, other required public utilities (with
respect to each of the aforementioned items, by means of either a direct connection to the source
of such utilities or through connections available on publicly dedicated roadways directly abutting
the Premises or through permanent insurable easements benefiting the Premises), fire and police
protection, parking, and means of direct access between the Premises and public highways over
recognized curb cuts (or such access to public highways is through private roadways which may be
used for ingress and egress pursuant to permanent insurable easements).

     (l) Mechanics’ Liens. The Property is free and clear of any mechanics’ liens or liens
in the nature thereof, and no rights are outstanding that under law could give rise to any such
liens, any of which liens are or may be prior to, or equal with, the lien of this Security
Instrument, except those which are insured against by the title insurance policy insuring the lien
of this Security Instrument.

     (m) Title Insurance. Lender has received a lender’s title insurance policy insuring
this Security Instrument as a first lien on the Realty subject only to Permitted Encumbrances.

     (n) Insurance. The Property is insured in accordance with the requirements set forth
in Article III hereof.

     (o) Space Leases.

     (i) To Borrower’s best knowledge, Borrower has delivered a true, correct and complete
schedule of all Space Leases as of the date hereof, which accurately and completely sets
forth in all material respects, for each such Space Lease, the following (collectively, the
“Rent Roll”): the name and address of the tenant; the lease expiration date,
extension and renewal provisions; the base rent and percentage rent payable; and the
security deposit held thereunder.

     (ii) Each Space Lease constitutes the legal, valid and binding obligation of Borrower
or, the Operating Tenant, as applicable, and, to the knowledge of Borrower, is enforceable
against the tenant

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thereof. No default exists, or with the passing of time or the giving of notice would
exist, which would, in the aggregate, have a Material Adverse Effect.

     (iii) To Borrower’s best knowledge, no tenant under any Major Space Lease has, as of
the date hereof, paid Rent more than thirty (30) days in advance, and the Rents under such
Major Space Leases have not been waived, released, or otherwise discharged or compromised.

     (iv) To Borrower’s best knowledge, except as disclosed in writing to Lender, all work
to be performed by Borrower under the Space Leases has been substantially performed, all
contributions to be made by Borrower to the tenants thereunder have been made except for any
held-back amounts, and all other conditions precedent to each such tenant’s obligations
thereunder have been satisfied.

     (v) To Borrower’s best knowledge, except as previously disclosed to Lender in writing
or contained in the Space Leases, there are no options to terminate any Space Lease.

     (vi) To Borrower’s best knowledge, each tenant under a Major Space Lease or such
tenant’s authorized subtenant is currently occupying the space demised by such Major Space
Lease.

     (vii) To Borrower’s best knowledge, Borrower has delivered to Lender true, correct and
complete copies of all Space Leases described in the Rent Roll.

     (viii) No Space Lease has been assigned or, to Borrower’s best knowledge, modified,
supplemented or amended in any way.

     (ix) To Borrower’s best knowledge, each tenant under each Space Lease is free from
bankruptcy, reorganization or arrangement proceedings or a general assignment for the
benefit of creditors.

     (x) To Borrower’s best knowledge, no Space Lease provides any party with the right to
obtain a lien or encumbrance upon the Property superior to the lien of this Security
Instrument.

     (p) Property Agreements.

     (i) Borrower has delivered to Lender true, correct and complete copies of all Property
Agreements of record or which could bind any owner of the Property other than Borrower.

     (ii) No Property Agreement provides any party with the right to obtain a lien or
encumbrance upon the Property superior to the lien of this Security Instrument.

     (iii) No default exists or with the passing of time or the giving of notice or both
would exist under any Property Agreement which would, individually or in the aggregate, have
a Material Adverse Effect.

     (iv) Borrower has not received or given any written communication which alleges that a
default exists or, with the giving of notice or the lapse of time, or both, would exist
under the provisions of any Property Agreement.

     (v) No condition currently exists whereby Borrower or any future owner of the Property
may be required to purchase any other parcel of land which is subject to any Property
Agreement or which gives any Person a right to purchase, or right of first refusal with
respect to, the Property.

     (vi) To the best knowledge of Borrower, no offset or any right of offset exists
respecting continued contributions to be made by any party to any Property Agreement except
as expressly set forth

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therein. Except as previously disclosed to Lender in writing, no material exclusions or
restrictions on the utilization, leasing or improvement of the Property (including
non-compete agreements) exists in any Property Agreement.

     (vii) Except as previously disclosed in writing to Lender, all work, if any, required
to be performed by Borrower prior to the date hereof under each of the Property Agreements
has been substantially performed, all contributions to be made by Borrower to any party to
such Property Agreements have been made, and all other conditions to such party’s
obligations thereunder have been satisfied.

     (q) Personal Property. Except as previously disclosed in writing to Lender, Borrower
represents that it or Operating Tenant has good and marketable title to all personal property used
in connection with the operation of the Property, free and clear of any liens, except for liens
created under the Loan Documents and liens which describe the equipment and other personal property
owned by tenants and upon termination of any Operating Lease any personal property owned by
Operating Tenant will be transferred free and clear of any liens to Borrower.

     (r) Leasing Brokerage and Management Fees. Except as previously disclosed to Lender
in writing, there are no brokerage fees or commissions payable by Borrower with respect to the
leasing of space at the Property.

     (s) Security Deposits. Borrower is in compliance with all Legal Requirements relating
to such security deposits as to which failure to comply might, individually or in the aggregate,
have a Material Adverse Effect.

     (t) Loan to Value Ratio. To the best knowledge of Borrower, based on the substantial
real estate expertise of Borrower, Borrower’s familiarity with the Property, and the Appraisal
(which Borrower believes to contain a reasonable assessment of the fair market value of the
Property), the Initial Allocated Loan Amount does not exceed one hundred twenty-five percent (125%)
of the fair market value of the Property. For the purposes of this clause (t), the term “fair
market value” shall be reduced by (i) the amount of any indebtedness secured by a lien affecting
the Property that is prior to, or on a parity with, the lien of this Security Instrument, and (ii)
the value of any property that is not “real property” within the meaning of Treas. Reg. §§ 1.860G-2
and 1.856-3(d).

     (u) Representations Generally. The representations and warranties contained in this
Security Instrument, and the review and inquiry made on behalf of Borrower therefor, have all been
made by Persons having the requisite expertise and knowledge to provide such representations and
warranties. No representation, warranty or statement of fact made by or on behalf of Borrower in
this Security Instrument or in any certificate, document or schedule furnished to Lender pursuant
hereto, contains any untrue statement of a material fact or omits to state any material fact
necessary to make statements contained therein or herein not misleading (which may be to Borrower’s
best knowledge where so provided herein). There are no facts presently known to Borrower which
have not been disclosed to Lender which would, individually or in the aggregate, have a Material
Adverse Effect nor as far as Borrower can foresee might, individually or in the aggregate, have a
Material Adverse Effect.

     (v) Liquor License. All licenses, permits, approvals and consents which are required
for the sale and service of alcoholic beverages on the Premises have been obtained from the
applicable Governmental Authorities.

     Section 2.06. Removal of Lien. (a) Borrower shall, at its expense, maintain this
Security Instrument as a first lien on the Property and shall keep the Property free and clear of
all liens and encumbrances of any kind and nature other than the Permitted Encumbrances. Borrower
shall, within thirty (30) days following receipt of knowledge of any lien, promptly discharge of
record, by bond or otherwise, any such liens and, promptly upon request by Lender, shall deliver to
Lender evidence reasonably satisfactory to Lender of the discharge thereof.

     (b) Without limitation to the provisions of Section 2.06(a) hereof, Borrower shall (i) pay,
from time to time when the same shall become due, all claims and demands of mechanics, materialmen,
laborers, and others which, if unpaid, might result in, or permit the creation of, a lien on the
Property or any part thereof, (ii) cause to be

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removed of record (by payment or posting of bond or settlement or otherwise) any mechanics’,
materialmens’, laborers’ or other lien on the Property, or any part thereof, or on the revenues,
rents, issues, income or profit arising therefrom, and (iii) in general, do or cause to be done,
without expense to Lender, everything reasonably necessary to preserve in full the lien of this
Security Instrument. If Borrower fails to comply with the requirements of this Section 2.06(b),
then, upon five (5) Business Days’ prior notice to Borrower, Lender may, but shall not be obligated
to, pay any such lien, and Borrower shall, within five (5) Business Days after Lender’s demand
therefor, reimburse Lender for all sums so expended, together with interest thereon at the Default
Rate from the date advanced, all of which shall be deemed part of the Debt. Nothing contained
herein shall be deemed a consent or request of Lender, express or implied, by inference or
otherwise, to the performance of any alteration, repair or other work by any contractor,
subcontractor or laborer or the furnishing of any materials by any materialmen in connection
therewith.

     (c) Notwithstanding the foregoing, Borrower may contest any lien (other than a lien relating
to non-payment of Impositions, the contest of which shall be governed by Section 4.04 hereof) of
the type set forth in subparagraph (b)(ii) of this Section 2.06 provided that, following prior
notice to Lender (i) Borrower is contesting the validity of such lien with due diligence and in
good faith and by appropriate proceedings, without cost or expense to Lender or any of its agents,
employees, officers, or directors, (ii) Borrower shall preclude the collection of, or other
realization upon, any contested amount from the Property or any revenues from or interest in the
Property, (iii) neither the Property nor any part thereof nor interest therein, shall be in any
danger of being sold, forfeited or lost by reason of such contest by Borrower, (iv) such contest by
Borrower shall not affect the ownership, use or occupancy of the Property, (v) such contest by
Borrower shall not subject Lender or Borrower to the risk of civil or criminal liability (other
than the civil liability of Borrower for the amount of the lien in question), (vi) such lien is
subordinate to the lien of this Security Instrument, (vii) Borrower has not consented to such lien,
(viii) Borrower has given Lender prompt notice of the filing of such lien and the bonding thereof
by Borrower and, upon request by Lender from time to time, notice of the status of such contest by
Borrower and/or confirmation of the continuing satisfaction of the conditions set forth in this
Section 2.06(c), (ix) Borrower shall promptly pay the obligation secured by such lien upon a final
determination of Borrower’s liability therefor, and (x) Borrower shall deliver to Lender cash, a
bond or other security acceptable to Lender equal to 125% of the contested amount pursuant to
collateral arrangements reasonably satisfactory to Lender.

     Section 2.07. Cost of Defending and Upholding this Security Instrument Lien. If any
action or proceeding is commenced to which Lender is made a party relating to the Loan Documents
and/or the Property or Lender’s interest therein or in which it becomes necessary to defend or
uphold the lien of this Security Instrument or any other Loan Document, Borrower shall, on demand,
reimburse Lender for all expenses (including, without limitation, reasonable attorneys’ fees and
disbursements) incurred by Lender in connection therewith, and such sum, together with interest
thereon at the Default Rate from and after such demand until fully paid, shall constitute a part of
the Debt.

     Section 2.08. Use of the Property. Borrower will use, or cause to be used, the
Property for such use as is permitted pursuant to applicable Legal Requirements including, without
limitation, under the certificate of occupancy applicable to the Property, and which is required by
the Loan Documents. Borrower shall not suffer or permit the Property or any portion thereof to be
used by the public, any tenant, or any Person not subject to a Lease, in a manner as is reasonably
likely to impair Borrower’s title to the Property, or in such manner as may give rise to a claim or
claims of adverse usage or adverse possession by the public, or of implied dedication of the
Property or any part thereof.

     Section 2.09. Financial Reports. (a) Borrower will keep and maintain or will cause to
be kept and maintained on a Fiscal Year basis, in accordance with GAAP and The Uniform System of
Accounts (or such other accounting basis reasonably acceptable to Lender) consistently applied,
proper and accurate books, tax returns, records and accounts reflecting (i) all of the financial
affairs of Borrower and Guarantor and (ii) all items of income and expense in connection with the
operation of the Property or in connection with any services, equipment or furnishings provided in
connection with the operation thereof, whether such income or expense may be realized by Borrower
or by any other Person whatsoever, excepting lessees unrelated to and unaffiliated with Borrower
who have leased from Borrower portions of the Premises for the purpose of occupying the same.
Lender shall have the right from time to time at all times during normal business hours upon
reasonable notice to examine such books, tax

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returns, records and accounts at the office of Borrower or other Person maintaining such
books, tax returns, records and accounts and to make such copies or extracts thereof as Lender
shall desire. After the occurrence of an Event of Default, Borrower shall pay any costs and
expenses incurred by Lender to examine Borrower’s and Guarantor’s accounting records with respect
to the Property, as Lender shall determine to be necessary or appropriate in the protection of
Lender’s interest.

     (b) Borrower will furnish Lender (i) annually, within one hundred twenty (120) days following
the end of each Fiscal Year of Borrower and (ii) on a quarterly basis, within forty-five (45) days
following the end of each fiscal quarter of Borrower, with a complete copy of Borrower’s financial
statement consistently applied covering (i) all of the financial affairs of Borrower and (ii) the
operation of the Property for such Fiscal Year or fiscal quarters, as applicable, and containing a
statement of revenues and expenses, a statement of assets and liabilities and a statement of
Borrower’s equity. Each annual financial statement shall be accompanied by audited financial
statements of Ashford Hospitality Trust Inc. which are audited by a nationally recognized
Independent certified public accountant that is acceptable to Lender in accordance with GAAP and
The Uniform System of Accounts (or such other accounting basis reasonably acceptable to Lender).
Together with the financial statements required to be furnished pursuant to this Section 2.09(b),
Borrower shall furnish to Lender (A) an Officer’s Certificate certifying as of the date thereof (1)
that the financial statements accurately represent the results of operations and financial
condition of Borrower and the Property all in accordance with GAAP and The Uniform System of
Accounts (or such other accounting basis reasonably acceptable to Lender) consistently applied, and
(2) whether there exists a Default under the Note or any other Loan Document executed and delivered
by Borrower, and if such event or circumstance exists, the nature thereof, the period of time it
has existed and the action then being taken to remedy such event or circumstance and (B) together
with the financial statements delivered pursuant to Section 2.09(b)(ii) above, a statement showing
(1) projected Net Operating Income for the subsequent twelve (12) month period adjusted to reflect
the Adjusted Net Cash Flow (subject to verification by Lender in its reasonable discretion) and (2)
the calculation of the Aggregate Debt Service Coverage.

     (c) During the continuance of an O&M Operative Period and when requested by Lender, Borrower
will furnish Lender monthly, within twenty (20) days following the end of each month, with a true,
complete and correct cash flow statement with respect to the Property in the form required to be
delivered pursuant to the Management Agreement and made a part hereof or such other form acceptable
to Lender, showing (i) all cash receipts of any kind whatsoever and all cash payments and
disbursements, (ii) year-to-date summaries of such cash receipts, payments and disbursements, and
(iii) during an O&M Operative Period, a calculation of the Aggregate Debt Service Coverage,
together with a certification of Manager stating that such cash flow statement is true, complete
and correct and a list of all litigation and proceedings affecting Borrower or the Property in
which the amount involved is $250,000 or more, if not covered by insurance (or $1,000,000 or more
whether or not covered by insurance).

     (d) Intentionally Omitted.

     (e) At any time during which (i) an O&M Operative Period exists or (ii) the Rent under Space
Leases exceeds five percent (5%) of the annual Operating Income, Borrower will furnish Lender
annually, within twenty (20) days following the end of each year and within twenty (20) days
following receipt of such request therefor, with a true, complete and correct rent roll for the
Property which includes the information contained on the Rent Roll, including a list of which
tenants are in default under their respective Major Space Leases, dated as of the date of Lender’s
request, identifying each tenant that has filed a bankruptcy, insolvency, or reorganization
proceeding since delivery of the last such rent roll, and the arrearages for such tenant, if any,
and, if requested by Lender, a summary of the material terms of the Major Space Leases, including,
without limitation, the dates of occupancy, the dates of expiration, any Rent concessions, work
obligations or other inducements granted to the tenants thereunder, and any renewal options, and
such rent roll shall be accompanied by an Officer’s Certificate, dated as of the date of the
delivery of such rent roll, certifying that such rent roll is true, correct and complete in all
material respects as of its date.

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     (f) Borrower shall furnish to Lender, within thirty (30) days after Lender’s request therefor,
with such further detailed information with respect to the operation of the Property and the
financial affairs of Borrower as may be reasonably requested by Lender.

     (g) Borrower shall cause Manager to furnish to Lender, within twenty (20) days following the
end of each year, a schedule of tenant security deposits to the extent such security deposits
aggregate $1,000,000 or more.

     (h) Borrower will furnish Lender annually, within ninety (90) days after the end of each
Fiscal Year, with a report setting forth (i) the average occupancy rate of the Property during such
Fiscal Year, and (ii) the capital repairs, replacements and improvements performed at the Property
during such Fiscal Year and the aggregate Recurring Replacement Expenditures made in connection
therewith.

     (i) Borrower will furnish Lender monthly, within thirty (30) days following the end of each
month, an occupancy summary for the Property setting forth the occupancy rates, average daily room
rates, advance booking information (excluding customer names), RevPAR Yield Index, RevPAR and room
revenues for each month of the preceding calendar year, as well as annual averages of the same, and
such other information as may customarily be reflected thereon or reasonably requested by Lender,
together with all franchise inspection reports and STR Reports received by Borrower during the
preceding month.

     (j) Borrower shall and shall cause Guarantor to furnish to Lender annually, within thirty (30)
days of filing its respective tax return, a copy of such tax return.

     (k) Borrower shall submit to Lender for Lender’s written approval (provided that such approval
shall only be required in the event that Borrower or any Affiliate of Borrower has the right to
approve any such budget pursuant to the terms of the Management Agreement) not to be unreasonably
withheld, an Annual Budget within ten (10) Business Days after receipt thereof from Manager, in
form satisfactory to Lender setting forth in reasonable detail budgeted monthly operating income
and monthly operating capital and other expenses for the Property. In the event Lender shall have
the right to approve such Annual Budget and Lender objects to the proposed Annual Budget submitted
by Borrower, Lender shall advise Borrower of such objections within fifteen (15) days after receipt
thereof (and deliver to Borrower a reasonably detailed description of such objections) and Borrower
shall, within three (3) days after receipt of notice of any such objections, revise such Annual
Budget and resubmit the same to Lender. Lender shall advise Borrower of any objections to such
revised Annual Budget within ten (10) days after receipt thereof (and deliver to Borrower a
reasonably detailed description of such objections) and Borrower shall revise the same in
accordance with the process described herein until Lender approves an Annual Budget, provided,
however, that if Lender shall not advise Borrower of its objections to any proposed Annual Budget
within the applicable time period set forth in this Section, then such proposed Annual Budget shall
be deemed approved by Lender. If Lender has the right to approve the Annual Budget pursuant to the
terms of the Management Agreement, until such time that Lender approves a proposed Annual Budget,
the most recently Approved Annual Budget shall, except as otherwise provided in the Management
Agreement, apply; provided that, such Approved Annual Budget shall be adjusted to reflect actual
increases in Basic Carrying Costs and utilities expenses and to delete any non-recurring expenses.
In the event that Borrower must incur an Extraordinary Expense, then Borrower shall promptly
deliver to Lender a reasonably detailed explanation of such proposed Extraordinary Expense which,
if Borrower has the right to approve such expenditures pursuant to the terms of the Management
Agreement, shall be subject to Lender’s approval, which approval may be granted or denied in
Lender’s reasonable discretion.

     (l) In the event that Borrower fails to deliver any of the financial statements, reports or
other information required to be delivered to Lender pursuant to this Section 2.09 on or prior to
their due dates, if any such failure shall continue for ten (10) days following notice thereof from
Lender, Borrower shall pay to Lender on each Payment Date for each month or portion thereof that
any such financial statement, report or other information remains undelivered, an administrative
fee in the amount of Two Thousand Five Hundred Dollars ($2,500) in the aggregate for all failures
occurring in any applicable month. Borrower agrees that such administrative fee (i) is a fair and
reasonable fee necessary to compensate Lender for its additional administrative costs and increased
costs relating to Borrower’s failure to deliver the aforementioned statements, reports or other
items as and when required hereunder and (ii) is not a penalty.

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     Section 2.10. Litigation. Borrower will give prompt written notice to Lender of any
litigation or governmental proceedings pending or threatened (in writing) against Borrower which
might have a Material Adverse Effect.

     Section 2.11. Updates of Representations. Borrower shall deliver to Lender within ten
(10) Business Days of the request of Lender an Officer’s Certificate updating all of the
representations and warranties contained in this Security Instrument and the other Loan Documents
and certifying that all of the representations and warranties contained in this Security Instrument
and the other Loan Documents, as updated pursuant to such Officer’s Certificate, are true, accurate
and complete in all material respects as of the date of such Officer’s Certificate or shall set
forth the exceptions to representations and/or warranties in reasonable detail, as applicable, and,
upon Lender’s request for further information with respect to such exceptions, shall provide Lender
such additional information as Lender may reasonably request

     Section 2.12. Tenancy-in-Common. In the event that title to the Property is held by
tenants-in-common, Borrower has delivered a true and complete written tenancy-in-common agreement
(the “TIC Agreement”) which has been duly executed by each tenant-in-common having an
interest in the Property (each, a “TIC”). The TIC Agreement provides, or, if not otherwise
provided for in the TIC Agreement, each TIC agrees, that (a) each TIC irrevocably waives any and
all rights of partition available at law, in equity or by contract, (b) each TIC shall at all times
be a Single Purpose Entity all of the legal and beneficial interest in which is owned by an
“Accredited Investor” as defined in Regulation D, as promulgated under the Securities Act, (c) each
TIC irrevocably waives any and all rights it may have at law or in equity to obtain a lien on any
tenant-in-common interest in the Property, (d) each TIC agrees that (i) any liens, security
interests, judgment liens, charges or other encumbrances upon the Property or any interest of
another TIC in the Property and (ii) any options to purchase or rights of first refusal or similar
rights with respect to another TIC’s interest in the Property shall be and remain inferior and
subordinate to any liens, security interests, judgment liens, charges or other encumbrances upon
Borrower’s assets securing payment of the Debt, regardless of whether such liens, security
interests, judgment liens, charges or other encumbrances, rights or options presently exist or are
hereafter created or attach and that no TIC shall (i) exercise or enforce any creditor’s right it
may have against Borrower or any other TIC or (ii) foreclose, repossess, sequester or otherwise
take steps or institute any action or proceedings (judicial or otherwise, including without
limitation the commencement of, or joinder in, any liquidation, bankruptcy, rearrangement, debtor’s
relief or insolvency proceeding) to enforce any liens, security interests, judgment liens, charges
or other encumbrances on assets of Borrower or any other TIC, (e) at no time shall there be more
than three (3) TICs with respect to the Property, (f) the minimum investment in the Property of
each TIC shall be $500,000 and (g) Lender is a third-party beneficiary to the provisions relating
to the items set forth in (a) through (f) above. Borrower shall not amend, modify or terminate the
TIC Agreement.

ARTICLE III:  INSURANCE AND CASUALTY RESTORATION

     Section 3.01. Insurance Coverage. Borrower shall, at its expense, maintain or cause
to be maintained the following insurance coverages with respect to the Property during the term of
this Security Instrument:

(a) (i) Insurance against loss or damage by fire, casualty and other hazards included in an
“all-risk” coverage endorsement or its equivalent (which, in the case of insurance during
the time of any construction work (“Construction”) shall be in “builder’s risk
completed value non-reporting form” together with rents, earnings and extra expense
insurance covering loss due to delay in completion of the Improvements), with such
endorsements as Lender may from time to time reasonably require and which are customarily
required by Institutional Lenders of similar properties similarly situated, including,
without limitation, if the Property constitutes a legal non-conforming use, an ordinance of
law coverage endorsement which contains “Demolition Cost”, “Loss Due to Operation of Law”
and “Increased Cost of Construction” coverages, covering the Property in an amount not less
than the greater of (A) 100% of the insurable replacement value of the Property (exclusive
of the Premises and footings and foundations) and (B) such other amount as is necessary to
prevent any reduction in such policy by reason of and to prevent Borrower, Lender or any
other insured thereunder from being deemed to be a co-insurer. Not less frequently than
once every three (3) years, Borrower, at its option, shall either (A) have the Appraisal
updated or obtain a new appraisal of

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the Property, (B) have a valuation of the Property made by or for its insurance carrier
conducted by an appraiser experienced in valuing properties of similar type to that of the
Property which are in the geographical area in which the Property is located or (C) provide
such other evidence as will, in Lender’s sole judgment, enable Lender to determine whether
there shall have been an increase in the insurable value of the Property and Borrower shall
deliver such updated Appraisal, new appraisal, insurance valuation or other evidence
acceptable to Lender, as the case may be, and, if such updated Appraisal, new appraisal,
insurance valuation, or other evidence acceptable to Lender reflects an increase in the
insurable value of the Property, the amount of insurance required hereunder shall be
increased accordingly and Borrower shall deliver evidence satisfactory to Lender that such
policy has been so increased.

     (ii) Commercial general liability insurance against claims for personal and bodily
injury and/or death to one or more persons or property damage, occurring on, in or about the
Property (including the adjoining streets, sidewalks and passageways therein) in such
amounts as Lender may from time to time reasonably require (but in no event shall Lender’s
requirements be increased more frequently than once during each twelve (12) month period)
and which are customarily required by Institutional Lenders for similar properties similarly
situated, but not less than $1,000,000 per occurrence and $2,000,000 general aggregate on a
per location basis and, in addition thereto, not less than $50,000,000, or such lesser
amount as is required by the term of the Management Agreement (but in no event less than
$10,000,000) excess and/or umbrella liability insurance shall be maintained for any and all
claims.

     (iii) Business interruption, rent loss or other similar insurance with an unlimited
indemnity period (A) with loss payable to Lender, (B) covering all risks required to be
covered by the insurance provided for in Section 3.01(a)(i) hereof and (C) in an amount not
less than 100% of the projected total revenues derived from the Property for the succeeding
twenty-four (24) month period based on an occupancy rate taking into account historical and
projected occupancy. The amount of such insurance shall be determined upon the execution of
this Security Instrument, and not more frequently than once each calendar year thereafter
based on Borrower’s reasonable estimate of projected total revenues derived from the
Property for the next succeeding twenty-four (24) months together with a six (6) month
extended period of indemnity. In the event the Property shall be damaged or destroyed,
Borrower shall and hereby does assign to Lender all payment of claims under the policies of
such insurance, and all amounts payable thereunder, and all net amounts, shall be collected
by Lender under such policies and shall be applied in accordance with this Security
Instrument.

     (iv) Intentionally Omitted.

     (v) Insurance against loss or damages from (A) leakage of sprinkler systems and (B)
explosion of steam boilers, air conditioning equipment, pressure vessels or similar
apparatus now or hereafter installed at the Property, in such amounts as Lender may from
time to time reasonably require and which are then customarily required by Institutional
Lenders of similar properties similarly situated.

     (vi) Flood insurance in an amount equal to the full insurable value of the Property or
the maximum amount available, whichever is less, if the Improvements are located in an area
designated by the Secretary of Housing and Urban Development as being “an area of special
flood hazard” under the National Flood Insurance Program (i.e., having a one percent
or greater chance of flooding), and if flood insurance is available under the National Flood
Insurance Act.

     (vii) Worker’s compensation insurance or other similar insurance which may be required
by Governmental Authorities or Legal Requirements.

     (viii) Insurance against loss resulting from mold, spores or fungus on or about the
Premises.

     (ix) Insurance against damage resulting from acts of terrorism, or an insurance
policy without an exclusion for damages resulting from terrorism, on terms consistent with
the commercial property insurance policy required under subsections (i), (ii) and (iii)
above.

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     (x) At all times during Construction, contractor’s liability insurance to a limit of
not less than $25,000,000 on a per occurrence basis covering each contractor’s construction
operation at the Premises.

     (xi) Such other insurance as may from time to time be required by Lender and which is
then customarily required by Institutional Lenders for similar properties similarly
situated, against other insurable hazards, including, but not limited to, malicious
mischief, vandalism, sinkhole and mine subsidence, acts of terrorism, war risk, windstorm
and/or earthquake, due regard to be given to the size and type of the Premises,
Improvements, Fixtures and Equipment and their location, construction and use.
Additionally, Borrower shall carry such insurance coverage as Lender may from time to time
require if the failure to carry such insurance may result in a downgrade, qualification or
withdrawal of any class of securities issued in connection with a Securitization or, if the
Loan is not yet part of a Securitization, would result in an increase in the subordination
levels of any class of securities anticipated to be issued in connection with a proposed
Securitization.

     (xii) If Borrower, any of its Affiliates or Manager holds a liquor license for the
Premises, liquor liability insurance in the amount of no less than $10,000,000.

     (xiii) Automobile liability insurance covering owned, hired and not owned vehicles in an
amount of not less than $1,000,000 per accident.

     (b) Borrower shall cause any Manager of the Property to maintain fidelity insurance in an
amount equal to or greater than the Operating Income of the Property for the six (6) month period
immediately preceding the date on which the premium for such insurance is due and payable or such
lesser amount as Lender shall approve.

     Section 3.02. Policy Terms. (a) All insurance required by this Article III shall be
in the form (other than with respect to Sections 3.01(a)(vi) and (vii) above when insurance in
those two sub-sections is placed with a governmental agency or instrumentality on such agency’s
forms) and amount and with deductibles as, from time to time, shall be reasonably acceptable to
Lender, under valid and enforceable policies issued by financially responsible insurers authorized
to do business in the State where the Property is located, with a general policyholder’s service
rating of not less than A and a financial rating of not less than XIII as rated in the most
currently available Best’s Insurance Reports (or the equivalent, if such rating system shall
hereafter be altered or replaced) and shall have a claims paying ability rating and/or financial
strength rating, as applicable, of not less than “AA” (or its equivalent), or such lower claims
paying ability rating and/or financial strength rating, as applicable, as Lender shall, in its sole
and absolute discretion, consent to, from a Rating Agency (one of which after a Securitization in
which Standard & Poor’s rates any securities issued in connection with such Securitization, shall
be Standard & Poor’s). Upon request of Lender originals or certified copies of all insurance
policies shall be delivered to and held by Lender. All such policies (except policies for worker’s
compensation) shall name Lender, its successors and/or assigns as an additional insured or, with
respect to the insurance required pursuant to Section 3.01(a)(iii) above, shall provide for loss
payable to Lender, its successors and/or assigns and shall contain (or have attached): (i)
standard “non-contributory mortgagee” endorsement or its equivalent relating, inter
alia, to recovery by Lender notwithstanding the negligent or willful acts or omissions of
Borrower; (ii) a waiver of subrogation endorsement as to Lender; (iii) an endorsement indicating
that neither Lender nor Borrower shall be or be deemed to be a co-insurer with respect to any
casualty risk insured by such policies and shall provide for a deductible per loss of an amount not
more than $25,000, and (iv) a provision that such policies shall not be canceled, terminated,
denied renewal or amended, including, without limitation, any amendment reducing the scope or
limits of coverage, without at least thirty (30) days’ prior written notice to Lender in each
instance. Not less than thirty (30) days prior to the expiration dates of the insurance policies
obtained pursuant to this Security Instrument, certificates evidencing such renewals bearing
notations evidencing the payment of premiums or accompanied by other reasonable evidence of such
payment (which premiums shall not be paid by Borrower through or by any financing arrangement which
would entitle an insurer to terminate a policy) shall be delivered by Borrower to Lender. Borrower
shall not carry separate insurance, concurrent in kind or form or contributing in the event of
loss, with any insurance required under this Article III.

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     (b) If Borrower fails to maintain and deliver to Lender the original policies or certificates
of insurance required by this Security Instrument, or if there are insufficient funds in the Basic
Carrying Costs Escrow Account to pay the premiums for same, Lender may, at its option, procure such
insurance, and Borrower shall pay, or as the case may be, reimburse Lender for, all premiums
thereon promptly, upon demand by Lender, with interest thereon at the Default Rate from the date
paid by Lender to the date of repayment and such sum shall constitute a part of the Debt.

     (c) Borrower shall notify Lender of the renewal premium of each insurance policy and Lender
shall be entitled to pay such amount on behalf of Borrower from the Basic Carrying Costs Escrow
Account.

     (d) The insurance required by this Security Instrument may, at the option of Borrower, be
effected by blanket and/or umbrella policies issued to Borrower or Manager covering the Property
provided that, in each case, the policies otherwise comply with the provisions of this Security
Instrument and allocate to the Property, from time to time (but in no event less than once a year),
the coverage specified by this Security Instrument, without possibility of reduction or coinsurance
by reason of, or damage to, any other property (real or personal) named therein. If the insurance
required by this Security Instrument shall be effected by any such blanket or umbrella policies,
Borrower shall furnish to Lender (i) an original certificate of insurance together with reasonable
access to the original of such policy to review such policy’s coverage of the Property, with
schedules attached thereto showing the amount of the insurance provided under such policies
applicable to the Property and (ii) an Officer’s Certificate setting forth (A) the number of
properties covered by such policy, (B) the location by city (if available, otherwise, county) and
state of the properties, (C) the average square footage of the properties, (D) a brief description
of the typical construction type included in the blanket policy and (E) such other information as
Lender may reasonably request.

     Section 3.03. Assignment of Policies. (a) Borrower hereby assigns to Lender the
proceeds of all insurance (other than worker’s compensation and liability insurance) obtained
pursuant to this Security Instrument, all of which proceeds shall be payable to Lender as
collateral and further security for the payment of the Debt and the performance of the
Cross-collateralized Borrowers’ obligations hereunder and under the other Loan Documents, and
Borrower hereby authorizes and directs the issuer of any such insurance to make payment of such
proceeds directly to Lender. Except as otherwise expressly provided in Section 3.04 or elsewhere
in this Article III, Lender shall have the option, in its discretion, and without regard to the
adequacy of its security, to apply all or any part of the proceeds it may receive pursuant to this
Article in such manner as Lender may elect to any one or more of the following: (i) the payment of
the Debt, whether or not then due, in any proportion or priority as Lender, in its discretion, may
elect, (ii) the repair or restoration of the Property, (iii) the cure of any Default or (iv) the
reimbursement of the costs and expenses of Lender incurred pursuant to the terms hereof in
connection with the recovery of the Insurance Proceeds. Nothing herein contained shall be deemed
to excuse Borrower from repairing or maintaining the Property as provided in this Security
Instrument or restoring all damage or destruction to the Property, regardless of the sufficiency of
the Insurance Proceeds, and the application or release by Lender of any Insurance Proceeds shall
not cure or waive any Default or notice of Default.

     (b) In the event of the foreclosure of this Security Instrument or any other transfer of title
or assignment of all or any part of the Property in extinguishment, in whole or in part, of the
Debt, all right, title and interest of Borrower in and to all policies of insurance required by
this Security Instrument shall inure to the benefit of the successor in interest to Borrower or the
purchaser of the Property. If, prior to the receipt by Lender of any proceeds, the Property or any
portion thereof shall have been sold on foreclosure of this Security Instrument or by deed in lieu
thereof or otherwise, or any claim under such insurance policy arising during the term of this
Security Instrument is not paid until after the extinguishment of the Debt, and Lender shall not
have received the entire amount of the Debt outstanding at the time of such extinguishment, whether
or not a deficiency judgment on this Security Instrument shall have been sought or recovered or
denied, then, the proceeds of any such insurance to the extent of the amount of the Debt not so
received, shall be paid to and be the property of Lender, together with interest thereon at the
Default Rate, and the reasonable attorney’s fees, costs and disbursements incurred by Lender in
connection with the collection of the proceeds which shall be paid to Lender and Borrower hereby
assigns, transfers and sets over to Lender all of Borrower’s right, title and interest in and to
such proceeds. Notwithstanding any provisions of this Security Instrument to the contrary, Lender
shall not be deemed to be a trustee or other fiduciary with respect to its receipt of any such
proceeds, which may be commingled with any other monies of

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Lender; provided, however, that Lender shall use such proceeds for the purposes and in the
manner permitted by this Security Instrument. Any proceeds deposited with Lender shall be held by
Lender in an interest-bearing account, but Lender makes no representation or warranty as to the
rate or amount of interest, if any, which may accrue on such deposit and shall have no liability in
connection therewith. Interest accrued, if any, on the proceeds shall be deemed to constitute a
part of the proceeds for purposes of this Security Instrument. The provisions of this Section
3.03(b) shall survive the termination of this Security Instrument by foreclosure, deed in lieu
thereof or otherwise as a consequence of the exercise of the rights and remedies of Lender
hereunder after a Default.

     Section 3.04. Casualty Restoration. (a) (i) In the event of any damage to or
destruction of the Property the cost to repair which could reasonably be expected to be in excess
of $250,000 in the aggregate, Borrower shall give prompt written notice to Lender (which notice
shall set forth Borrower’s good faith estimate of the cost of repairing or restoring such damage or
destruction, or if Borrower cannot reasonably estimate the anticipated cost of restoration,
Borrower shall nonetheless give Lender prompt notice of the occurrence of such damage or
destruction, and will diligently proceed to obtain estimates to enable Borrower to quantify the
anticipated cost and time required for such restoration, whereupon Borrower shall promptly notify
Lender of such good faith estimate) and, provided that restoration does not violate any Legal
Requirements, Borrower shall promptly commence and diligently prosecute to completion the repair,
restoration or rebuilding of the Property so damaged or destroyed to a condition such that the
Property shall be at least equal in value to that immediately prior to the damage to the extent
practicable, in full compliance with all Legal Requirements and the provisions of all Leases, and
in accordance with Section 3.04(b) below. Such repair, restoration or rebuilding of the Property
are sometimes hereinafter collectively referred to as the “Work”.

     (ii) Borrower shall not adjust, compromise or settle any claim for Insurance Proceeds
without the prior written consent of Lender, which shall not be unreasonably withheld or
delayed and Lender shall have the right, at Borrower’s sole cost and expense, to participate
in any settlement or adjustment of Insurance Proceeds; provided, however, that, except
during the continuance of an Event of Default, Lender’s consent shall not be required with
respect to the adjustment, compromising or settlement of any claim for Insurance Proceeds in
an amount less than $1,000,000.

     (iii) Subject to Section 3.04(a)(iv), Lender shall apply any Insurance Proceeds which it
may receive towards the Work in accordance with Section 3.04(b) and the other applicable
sections of this Article III.

     (iv) If (A) an Event of Default shall have occurred, (B) Lender is not reasonably
satisfied that the Debt Service Coverage, after substantial completion of the Work, will be
at least equal to the Required Debt Service Coverage, (C) more than thirty percent (30%) of
the reasonably estimated fair market value of the Property is damaged or destroyed, (D)
Lender is not reasonably satisfied that the Work can be completed six (6) months prior to
Maturity or (E) Lender is not reasonably satisfied that the Work can be completed within
twelve (12) months of the damage to or destruction of the Property (each, a “Substantial
Casualty”), Lender shall have the option, in its sole discretion to apply any Insurance
Proceeds it may receive pursuant to this Security Instrument (less any cost to Lender of
recovering and paying out such proceeds incurred pursuant to the terms hereof and not
otherwise reimbursed to Lender, including, without limitation, reasonable attorneys’ fees
and expenses) to the payment of the Debt, without any prepayment fee or charge of any kind,
or to allow such proceeds to be used for the Work pursuant to the terms and subject to the
conditions of Section 3.04(b) hereof and the other applicable sections of this Article III.

     (v) In the event that Lender elects or is obligated hereunder to allow Insurance
Proceeds to be used for the Work, any excess proceeds remaining after completion of such
Work shall be applied to the payment of the Debt without any prepayment fee or charge of any
kind.

     (vi) If any Insurance Proceeds are applied to the payment of the Debt, provided that no
Event of Default exists, Borrower may prepay the balance of the Release Price with respect
to the Property in connection with obtaining a Release of the Property without any
prepayment fee or charge of any kind.

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     (b) If any Condemnation Proceeds in accordance with Section 6.01(a), or any Insurance Proceeds
in accordance with Section 3.04(a), are to be applied to the repair, restoration or rebuilding of
the Property, then such proceeds shall be deposited into a segregated interest-bearing bank account
at the Bank, which shall be an Eligible Account, held by Lender and shall be paid out from time to
time to Borrower as the Work progresses (less any cost to Lender of recovering and paying out such
proceeds, including, without limitation, reasonable attorneys’ fees and costs allocable to
inspecting the Work and the plans and specifications therefor) subject to Section 5.13 hereof and
to all of the following conditions:

     (i) An Independent architect or engineer selected by Borrower and reasonably acceptable
to Lender (an “Architect” or “Engineer”) or a Person otherwise reasonably
acceptable to Lender, shall have delivered to Lender a certificate estimating the cost of
completing the Work, and, if the amount set forth therein is more than the sum of the amount
of Insurance Proceeds then being held by Lender in connection with a casualty and amounts
agreed or reasonably expected to be agreed to be paid as part of a final settlement under
the insurance policy upon or before completion of the Work, Borrower shall have delivered to
Lender (A) cash collateral in an amount equal to such excess, (B) an unconditional,
irrevocable, clean sight draft letter of credit, in form, substance and issued by a bank
reasonably acceptable to Lender, in the amount of such excess and draws on such letter of
credit shall be made by Lender to make payments pursuant to this Article III following
exhaustion of the Insurance Proceeds therefor or (C) a completion bond in form, substance
and issued by a surety company reasonably acceptable to Lender.

     (ii) If the cost of the Work is reasonably estimated by an Architect or Engineer in a
certification reasonably acceptable to Lender to be equal to or exceed five percent (5%) of
the Allocated Loan Amount, such Work shall be performed under the supervision of an
Architect or Engineer, it being understood that the plans and specifications with respect
thereto shall provide for Work so that, upon completion thereof, the Property shall be at
least equal in replacement value and general utility to the Property prior to the damage or
destruction.

     (iii) Each request for payment shall be made on not less than ten (10) days’ prior
notice to Lender and shall be accompanied by a certificate of an Architect or Engineer, or,
if the Work is not required to be supervised by an Architect or Engineer, by an Officer’s
Certificate stating (A) that payment is for Work completed substantially in compliance with
the plans and specifications, if required under clause (ii) above, (B) that the sum
requested is required to reimburse Borrower for payments by Borrower to date, or is due to
the contractors, subcontractors, materialmen, laborers, engineers, architects or other
Persons rendering services or materials for the Work (giving a brief description of such
services and materials), and that when added to all sums previously paid out by Lender does
not exceed the value of the Work done to the date of such certificate, (C) if the sum
requested is to cover payment relating to repair and restoration of personal property
required or relating to the Property, that title to the personal property items covered by
the request for payment is vested in Borrower (unless Borrower is lessee of such personal
property), and (D) that the Insurance Proceeds and other amounts deposited by Borrower held
by Lender after such payment is more than the estimated remaining cost to complete such
Work; provided, however, that if such certificate is given by an Architect or Engineer, such
Architect or Engineer shall certify as to clause (A) above, and such Officer’s Certificate
shall certify as to the remaining clauses above, and provided, further, that Lender shall
not be obligated to disburse such funds if Lender determines, in Lender’s reasonable
discretion, that Borrower shall not be in compliance with this Section 3.04(b).
Additionally, each request for payment shall contain a statement signed by Borrower stating
that the requested payment is for Work satisfactorily done to date.

     (iv) Each request for payment shall be accompanied by waivers of lien, in customary
form and substance, covering that part of the Work for which payment has been made pursuant
to any previous request for payment and, if required by Lender, a search prepared by a title
company or licensed abstractor, or by other evidence reasonably satisfactory to Lender that
there has not been filed with respect to the Property any mechanic’s or other lien or
instrument for retention of title relating to any part of the Work not discharged of record.
Additionally, as to any personal property covered by the request for payment, Lender shall
be furnished with evidence of Borrower having incurred a payment obligation therefor and

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such further evidence reasonably satisfactory to assure Lender that UCC filings
therefor provide a valid first lien on the personal property in favor of Lender.

     (v) Lender shall have the right to inspect the Work at all reasonable times upon
reasonable prior notice and may condition any disbursement of Insurance Proceeds upon
satisfactory compliance by Borrower with the provisions hereof. Neither the approval by
Lender of any required plans and specifications for the Work nor the inspection by Lender of
the Work shall make Lender responsible for the preparation of such plans and specifications,
or the compliance of such plans and specifications of the Work, with any applicable law,
regulation, ordinance, covenant or agreement.

     (vi) Insurance Proceeds shall not be disbursed more frequently than once every thirty
(30) days.

     (vii) Until such time as the Work has been substantially completed, Lender shall not be
obligated to disburse to Borrower an amount (the “Retention Amount”) up to (A) until
fifty percent (50%) of the Work has been completed (as reasonably determined by Lender), ten
percent (10%) of the cost of the Work and (B) after fifty percent (50%) of the Work has been
completed (as reasonably determined by Lender), five percent (5%) of the cost of the Work.
Upon substantial completion of the Work, Borrower shall send notice thereof to Lender and,
subject to the conditions of Section 3.04(b)(i)-(iv), Lender shall disburse one-half of the
Retention Amount to Borrower; provided, however, that the remaining one-half of the
Retention Amount shall be disbursed to Borrower when Lender shall have received copies of
any and all final certificates of occupancy or other certificates, licenses and permits
required for the ownership, occupancy and operation of the Property in accordance with all
Legal Requirements. Borrower hereby covenants to diligently seek to obtain any such
certificates, licenses and permits.

     (viii) Upon failure on the part of Borrower promptly to commence the Work or to proceed
diligently and continuously to completion of the Work, subject to Force Majeure, not to
exceed sixty (60) days, which failure shall continue after notice for thirty (30) days,
Lender may apply any Insurance Proceeds or Condemnation Proceeds it then or thereafter holds
to the payment of the Debt in accordance with the provisions of the Note; provided, however,
that Lender shall be entitled to apply at any time all or any portion of the Insurance
Proceeds or Condemnation Proceeds it then holds to the extent necessary to cure any Event of
Default.

     (c) If Borrower (i) within ninety (90) days (plus, if all approvals from Governmental
Authorities have not been obtained within such period and Borrower has continuously and
expeditiously attempted to obtain such approvals within such time period, such additional period of
time required to obtain approvals from all Governmental Authorities up to one hundred eighty (180)
days in total, provided Borrower deposits with Lender an amount, as reasonably determined by
Lender, equal to the Required Debt Service Payment for each additional thirty (30) day period)
after the occurrence of any damage to the Property or any portion thereof (or such shorter period
as may be required under any Major Space Lease) shall fail to submit to Lender for approval plans
and specifications for the Work (approved by the Architect and by all Governmental Authorities
whose approval is required), (ii) after any such plans and specifications are approved by all
Governmental Authorities, the Architect and Lender, shall fail to promptly commence such Work or
(iii) shall fail to diligently prosecute such Work to completion, then, in addition to all other
rights available hereunder, at law or in equity, Lender, or any receiver of the Property or any
portion thereof, upon five (5) days’ prior notice to Borrower (except in the event of emergency in
which case no notice shall be required), may (but shall have no obligation to) perform or cause to
be performed such Work, and may take such other steps as it reasonably deems advisable. Borrower
hereby waives, for Borrower, any claim, other than for gross negligence or willful misconduct,
against Lender and any receiver arising out of any act or omission of Lender or such receiver
pursuant hereto, and Lender may apply all or any portion of the Insurance Proceeds (without the
need to fulfill any other requirements of this Section 3.04) to reimburse Lender and such receiver,
for all costs not reimbursed to Lender or such receiver upon demand together with interest thereon
at the Default Rate from the date such amounts are advanced until the same are paid to Lender or
the receiver.

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     (d) If the Insurance Proceeds are greater than $1,000,000 or an Event of Default exists
Borrower hereby irrevocably appoints Lender as its attorney-in-fact, coupled with an interest, to
collect and receive any Insurance Proceeds paid with respect to any portion of the Property or the
insurance policies required to be maintained hereunder, and to endorse any checks, drafts or other
instruments representing any Insurance Proceeds whether payable by reason of loss thereunder or
otherwise.

     (e) Notwithstanding the foregoing provisions of this Section 3.04, upon the occurrence of any
damage to or destruction of the Property, provided that such damage or destruction is not a
Substantial Casualty, if in Lender’s reasonable judgment the cost of repair of or restoration to
the Property required as a result of any damage or destruction is less than $1,000,000 in the
aggregate and the Work can be completed in less than one hundred twenty (120) days (but in no event
beyond the date which is six (6) months prior to the Maturity Date), then Lender, upon request by
Borrower, shall permit Borrower to apply for and receive the Insurance Proceeds directly from the
insurer (and Lender shall advise the insurer to pay over such Insurance Proceeds directly to
Borrower), to the extent required to pay for any such Work, with any excess thereof to be promptly
paid by Borrower to Lender to be applied against the Debt.

     Section 3.05. Compliance with Insurance Requirements. Borrower promptly shall comply
with, and shall cause the Property to comply with, all Insurance Requirements, even if such
compliance requires structural changes or improvements or would result in interference with the use
or enjoyment of the Property or any portion thereof provided Borrower shall have a right to contest
in good faith and with diligence such Insurance Requirements provided (a) no Event of Default shall
exist during such contest and such contest shall not subject the Property or any portion thereof to
any lien or affect the priority of the lien of this Security Instrument, (b) failure to comply with
such Insurance Requirements will not subject Lender or any of its agents, employees, officers or
directors to any civil or criminal liability, (c) such contest will not cause any reduction in
insurance coverage, (d) such contest shall not affect the ownership, use or occupancy of the
Property, (e) the Property or any part thereof or any interest therein shall not be in any danger
of being sold, forfeited or lost by reason of such contest by Borrower, (f) Borrower has given
Lender prompt notice of such contest and, upon request by Lender from time to time, notice of the
status of such contest by Borrower and/or information of the continuing satisfaction of the
conditions set forth in clauses (a) through (e) of this Section 3.05, (g) upon a final
determination of such contest, Borrower shall promptly comply with the requirements thereof, and
(h) prior to and during such contest, Borrower shall furnish to Lender security satisfactory to
Lender, in its reasonable discretion, against loss or injury by reason of such contest or the
non-compliance with such Insurance Requirement (and if such security is cash, Lender shall deposit
the same in an interest-bearing account and interest accrued thereon, if any, shall be deemed to
constitute a part of such security for purposes of this Security Instrument, but Lender (i) makes
no representation or warranty as to the rate or amount of interest, if any, which may accrue
thereon and shall have no liability in connection therewith and (ii) shall not be deemed to be a
trustee or fiduciary with respect to its receipt of any such security and any such security may be
commingled with other monies of Lender). If Borrower shall use the Property or any portion thereof
in any manner which could permit the insurer to cancel any insurance required to be provided
hereunder, Borrower immediately shall obtain a substitute policy which shall satisfy the
requirements of this Security Instrument and which shall be effective on or prior to the date on
which any such other insurance policy shall be canceled. Borrower shall not by any action or
omission invalidate any insurance policy required to be carried hereunder unless such policy is
replaced as aforesaid, or materially increase the premiums on any such policy above the normal
premium charged for such policy. Borrower shall cooperate with Lender in obtaining for Lender the
benefits of any Insurance Proceeds lawfully or equitably payable to Lender in connection with the
transaction contemplated hereby.

     Section 3.06. Event of Default During Restoration. Notwithstanding anything to the
contrary contained in this Security Instrument including, without limitation, the provisions of
this Article III, if, at the time of any casualty affecting the Property or any part thereof, or at
any time during any Work, or at any time that Lender is holding or is entitled to receive any
Insurance Proceeds pursuant to this Security Instrument, a Default exists and is continuing
(whether or not it constitutes an Event of Default), Lender shall then have no obligation to make
such proceeds available for Work and Lender shall have the right and option, to be exercised in its
sole and absolute discretion and election, with respect to the Insurance Proceeds, either to retain
and apply such proceeds in reimbursement for the actual costs, fees and expenses incurred by Lender
in accordance with the terms hereof in connection with the adjustment of the loss and, after the
occurrence of an Event of Default, any balance toward

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payment of the Debt in such priority and proportions as Lender, in its sole discretion, shall
deem proper, or towards the Work, upon such terms and conditions as Lender shall determine, or to
cure such Event of Default, or to any one or more of the foregoing as Lender, in its sole and
absolute discretion, may determine. If Lender shall receive and retain such Insurance Proceeds,
the lien of this Security Instrument shall be reduced only by the amount thereof received, after
reimbursement to Lender of expenses of collection, and actually applied by Lender in reduction of
the principal sum payable under the Note in accordance with the Note.

     Section 3.07. Application of Proceeds to Debt Reduction. (a) No damage to the
Property, or any part thereof, by fire or other casualty whatsoever, whether such damage be partial
or total, shall relieve Borrower from its liability to pay in full the Debt and to perform its
obligations under this Security Instrument and the other Loan Documents.

     (b) If any Insurance Proceeds are applied to reduce the Debt, Lender shall apply the same in
accordance with the provisions of the Note.

ARTICLE IV:  IMPOSITIONS

     Section 4.01. Payment of Impositions, Utilities and Taxes, etc. (a) Borrower shall
pay or cause to be paid all Impositions at least five (5) days prior to the date upon which any
fine, penalty, interest or cost for nonpayment is imposed, and furnish to Lender, upon request,
receipted bills of the appropriate taxing authority or other documentation reasonably satisfactory
to Lender evidencing the payment thereof. If Borrower shall fail to pay any Imposition in
accordance with this Section and is not contesting or causing a contesting of such Imposition in
accordance with Section 4.04 hereof, or if there are insufficient funds in the Basic Carrying Costs
Escrow Account to pay any Imposition, Lender shall have the right, but shall not be obligated, to
pay that Imposition, and Borrower shall repay to Lender, on demand, any amount paid by Lender, with
interest thereon at the Default Rate from the date of the advance thereof to the date of repayment,
and such amount shall constitute a portion of the Debt secured by this Security Instrument and the
other Cross-collateralized Mortgages.

     (b) Borrower shall, prior to the date upon which any fine, penalty, interest or cost for the
nonpayment is imposed, pay or cause to be paid all charges for electricity, power, gas, water and
other services and utilities in connection with the Property. If Borrower shall fail to pay any
amount required to be paid by Borrower pursuant to this Section 4.01 and is not contesting such
charges in accordance with Section 4.04 hereof, Lender shall have the right, but shall not be
obligated, to pay that amount, and Borrower will repay to Lender, on demand, any amount paid by
Lender with interest thereon at the Default Rate from the date of the advance thereof to the date
of repayment, and such amount shall constitute a portion of the Debt secured by this Security
Instrument and the other Cross-collateralized Mortgages.

     (c) Borrower shall pay all taxes, charges, filing, registration and recording fees, excises
and levies imposed upon Lender by reason of or in connection with its ownership of any Loan
Document or any other instrument related thereto, or resulting from the execution, delivery and
recording of, or the lien created by, or the obligation evidenced by, any of them, other than
income, franchise and other similar taxes imposed on Lender and shall pay all corporate stamp
taxes, if any, and other taxes, required to be paid on the Loan Documents. If Borrower shall fail
to make any such payment within ten (10) days after written notice thereof from Lender, Lender
shall have the right, but shall not be obligated, to pay the amount due, and Borrower shall
reimburse Lender therefor, on demand, with interest thereon at the Default Rate from the date of
the advance thereof to the date of repayment, and such amount shall constitute a portion of the
Debt secured by this Security Instrument and the other Cross-collateralized Mortgages.

     Section 4.02. Deduction from Value. In the event of the passage after the date of
this Security Instrument of any Legal Requirement deducting from the value of the Property for the
purpose of taxation, any lien thereon or changing in any way the Legal Requirements now in force
for the taxation of this Security Instrument, the other Cross-collateralized Mortgages and/or the
Debt for federal, state or local purposes, or the manner of the operation of any such taxes so as
to adversely affect the interest of Lender, or imposing any tax or other charge on any Loan
Document, then Borrower will pay such tax, with interest and penalties thereon, if any, within the

46

 

statutory period. In the event the payment of such tax or interest and penalties by Borrower
would be unlawful, or taxable to Lender or unenforceable or provide the basis for a defense of
usury, then in any such event, Lender shall have the option, by written notice of not less than
thirty (30) days, to declare the Debt (or, if Lender determines in its sole and absolute
discretion, that no Material Adverse Effect may result therefrom, the Release Price with respect to
the Property) immediately due and payable, with no prepayment fee or charge of any kind.

     Section 4.03. No Joint Assessment. Borrower shall not consent to or initiate the
joint assessment of the Premises or the Improvements (a) with any other real property constituting
a separate tax lot and Borrower represents and covenants that the Premises and the Improvements are
and shall remain a separate tax lot or (b) with any portion of the Property which may be deemed to
constitute personal property, or any other procedure whereby the lien of any taxes which may be
levied against such personal property shall be assessed or levied or charged to the Property as a
single lien.

     Section 4.04. Right to Contest. Borrower shall have the right, after prior notice to
Lender, at its sole expense, to contest by appropriate legal proceedings diligently conducted in
good faith, without cost or expense to Lender or any of its agents, employees, officers or
directors, the validity, amount or application of any Imposition, provided that (a) no Event of
Default shall exist during such proceedings and such contest shall not (unless Borrower shall
comply with clause (d) of this Section 4.04) subject the Property or any portion thereof to any
lien or affect the priority of the lien of this Security Instrument, (b) failure to pay such
Imposition or charge will not subject Lender or any of its agents, employees, officers or directors
to any civil or criminal liability, (c) the contest suspends enforcement of the Imposition or
charge (unless Borrower first pays the Imposition or charge), (d) prior to and during such contest,
Borrower shall furnish to Lender security satisfactory to Lender, in its reasonable discretion,
against loss or injury by reason of such contest or the non-payment of such Imposition or charge
(and if such security is cash, Lender may deposit the same in an interest-bearing account and
interest accrued thereon, if any, shall be deemed to constitute a part of such security for
purposes of this Security Instrument, but Lender (i) makes no representation or warranty as to the
rate or amount of interest, if any, which may accrue thereon and shall have no liability in
connection therewith and (ii) shall not be deemed to be a trustee or fiduciary with respect to its
receipt of any such security and any such security may be commingled with other monies of Lender),
(e) such contest shall not affect the ownership, use or occupancy of the Property, (f) the Property
or any part thereof or any interest therein shall not be in any danger of being sold, forfeited or
lost by reason of such contest by Borrower, (g) Borrower has given Lender notice of the
commencement of such contest and upon request by Lender, from time to time, notice of the status of
such contest by Borrower and/or confirmation of the continuing satisfaction of clauses (a) through
(f) of this Section 4.04, and (h) upon a final determination of such contest, Borrower shall
promptly comply with the requirements thereof. Upon completion of any contest, Borrower shall
immediately pay the amount due, if any, and deliver to Lender proof of the completion of the
contest and payment of the amount due, if any, following which Lender shall return the security, if
any, deposited with Lender pursuant to clause (d) of this Section 4.04, provided that Lender shall,
so long as no Event of Default exists, disburse to Borrower any sums held by Lender pursuant to
clause (d) hereof to pay any contested Impositions. Borrower shall not pay any Imposition in
installments unless permitted by applicable Legal Requirements, and shall, upon the request of
Lender, deliver copies of all notices and bills relating to any Imposition or other charge covered
by this Article IV to Lender.

     Section 4.05. No Credits on Account of the Debt. Borrower will not claim or demand or
be entitled to any credit or credits on account of the Debt for any part of the Impositions
assessed against the Property or any part thereof and no deduction shall otherwise be made or
claimed from the taxable value of the Property, or any part thereof, by reason of this Security
Instrument or the Debt. In the event such claim, credit or deduction shall be required by Legal
Requirements, Lender shall have the option, by written notice of not less than thirty (30) days, to
declare the Debt (or, if Lender determines in its sole and absolute discretion, that no Material
Adverse Effect may result therefrom, the Release Price with respect to the Property) immediately
due and payable, and Borrower hereby agrees to pay such amounts not later than thirty (30) days
after such notice.

     Section 4.06. Documentary Stamps. If, at any time, the United States of America, any
State or Commonwealth thereof or any subdivision of any such State shall require revenue or other
stamps to be affixed to the Note, this Security Instrument or any other Loan Document, or impose
any other tax or charges on the same, Borrower will pay the same, with interest and penalties
thereon, if any.

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ARTICLE V:  CENTRAL CASH MANAGEMENT

     Section 5.01. Cash Flow. All payments constituting Rent shall be delivered to
Manager. Manager shall collect all Rent and shall deposit in the Collection Account, the name and
address of the bank in which such account is located and the account number of which to be
identified in writing by Borrower to Lender, all Property Available Cash. Pursuant to the
Collection Account Agreement of even date herewith, the bank in which the Collection Account is
located has been instructed that all collected funds deposited in the Collection Account shall be
automatically transferred through automated clearing house funds (“ACH”) or by Federal wire
to the Central Account prior to 3:00 p.m. (New York City time) on the Business Day immediately
prior to each Payment Date or, if an O&M Operative Period has occurred and is continuing, on a
daily basis. Within two (2) Business Days of the Closing Date, Borrower shall deliver to Lender a
copy of the irrevocable notice which Borrower delivered to the bank in which the Rent Account is
located pursuant to the provisions of this Section 5.01, the receipt of which is acknowledged in
writing by such bank. Lender may elect to change the financial institution in which the Central
Account shall be maintained; however, Lender shall give Borrower and the bank in which the
Collection Account is located not fewer than five (5) Business Days’ prior notice of such change.
Neither Borrower nor Manager shall change such bank or the Collection Account without the prior
written consent of Lender. All fees and charges of the bank(s) in which the Collection Account and
the Central Account are located shall be paid by Borrower.

     Section 5.02. Establishment of Accounts. Lender has established the Escrow Accounts
and the Central Account in the name of Lender and the Collection Account in the joint name of
Borrower and Lender, as secured party. The Escrow Accounts , the Collection Account and the
Central Account shall be under the sole dominion and control of Lender and funds held therein shall
not constitute trust funds. Borrower hereby irrevocably directs and authorizes Lender to withdraw
funds from the Collection Account, and to deposit into and withdraw funds from the Central Account
and the Escrow Accounts, all in accordance with the terms and conditions of this Security
Instrument. Borrower shall have no right of withdrawal in respect of the Collection Account, the
Central Account or the Escrow Accounts except as specifically provided herein. Each transfer of
funds to be made hereunder shall be made only to the extent that funds are on deposit in the
Collection Account, the Central Account or the affected Sub-Account or Escrow Account, and Lender
shall have no responsibility to make additional funds available in the event that funds on deposit
are insufficient. The Central Account shall contain the Basic Carrying Costs Sub-Account, the Debt
Service Payment Sub-Account, the Recurring Replacement Reserve Sub-Account, the Operation and
Maintenance Expense Sub-Account and the Curtailment Reserve Sub-Account, each of which accounts
shall be Eligible Accounts or book-entry sub-accounts of an Eligible Account (each a
“Sub-Account” and collectively, the “Sub-Accounts”) to which certain funds shall be
allocated and from which disbursements shall be made pursuant to the terms of this Security
Instrument. Sums held in the Escrow Accounts may be commingled with other monies held by Lender.

     Section 5.03. Intentionally Omitted.

     Section 5.04. Servicer. At the option of Lender, the Loan may be serviced by a
servicer (the “Servicer”) selected by Lender and Lender may delegate all or any portion of
its responsibilities under this Security Instrument to the Servicer.

     Section 5.05. Monthly Funding of Sub-Accounts and Escrow Accounts. (a) On or before
each Payment Date during the term of the Loan, commencing on the first (1st) Payment Date occurring
after the month in which the Loan is initially funded, Borrower shall pay or cause to be paid to
the Central Account all sums required to be deposited in the Sub-Accounts pursuant to this Section
5.05(a) and all funds transferred or deposited into the Central Account shall be allocated among
the Sub-Accounts as follows and in the following priority:

     (i) first, to the Basic Carrying Costs Sub-Account, until an amount equal to the Basic
Carrying Costs Monthly Installment for such Payment Date has been allocated to the Basic
Carrying Costs Sub-Account;

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     (ii) second, to the Debt Service Payment Sub-Account, until an amount equal to the
Required Debt Service Payment for such Payment Date has been allocated to the Debt Service
Payment Sub-Account;

     (iii) third, but only during any Default Management Period, to the Operation and
Maintenance Expense Sub-Account in an amount equal to the Cash Expenses, other than
management fees payable to Affiliates of Borrower, for the Interest Accrual Period ending
immediately prior to such Payment Date pursuant to the related Approved Annual Budget;

     (iv) fourth, but only during any Default Management Period, to the Operation and
Maintenance Expense Sub-Account in an amount equal to the amount, if any, of the Net Capital
Expenditures for the Interest Accrual Period ending immediately prior to such Payment Date
pursuant to the related Approved Annual Budget;

     (v) fifth, to the Recurring Replacement Reserve Sub-Account, but only until an amount
equal to the Recurring Replacement Reserve Monthly Installment for such Payment Date has
been allocated to the Recurring Replacement Reserve Sub-Account;

     (vi) sixth, but only during any Default Management Period, to the Operation and
Maintenance Expense Sub-Account in an amount equal to the amount, if any, of the
Extraordinary Expenses approved by Lender for the Interest Accrual Period ending immediately
prior to such Payment Date; and

     (vii) seventh, but only during an O&M Operative Period, the balance, if any, to the
Curtailment Reserve Sub-Account.

     Provided that no Event of Default has occurred and is continuing, Lender agrees that in each
Interest Accrual Period any amounts deposited into or remaining in the Central Account after the
Sub-Accounts have been funded as set forth in this Section 5.05(a) with respect to such Interest
Accrual Period and any periods prior thereto, shall be disbursed by Lender to Borrower on each
Payment Date and on the 15th day of each month (or if such date is not a Business Day, the first
Business Day after such date) applicable to such Interest Accrual Period. The balance of the funds
distributed to Borrower after payment of all Operating Expenses by or on behalf of Borrower may be
retained by Borrower. After the occurrence, and during the continuance, of an Event of Default, no
funds held in the Central Account shall be distributed to, or withdrawn by, Borrower, and Lender
shall have the right to apply all or any portion of the funds held in the Central Account or any
Sub-Account or any Escrow Account to the Debt in Lender’s sole discretion.

     (b) On each Payment Date, (i) sums held in the Basic Carrying Costs Sub-Account shall be
transferred to the Basic Carrying Costs Escrow Account, (ii) sums held in the Debt Service Payment
Sub-Account, together with any amounts deposited into the Central Account that are either (x) Loss
Proceeds that Lender has elected to apply to reduce the Debt in accordance with the terms of
Article III hereof or (y) excess Loss Proceeds remaining after the completion of any restoration
required hereunder, shall be transferred to Lender to be applied towards the Required Debt Service
Payment, (iii) sums held in the Recurring Replacement Reserve Sub-Account shall be transferred to
the Recurring Replacement Reserve Escrow Account, (iv) sums held in the Operation and Maintenance
Expense Sub-Account shall be transferred to the Operation and Maintenance Expense Escrow Account
and (v) sums held in the Curtailment Reserve Sub-Account shall be transferred to the Curtailment
Reserve Escrow Account.

     Section 5.06. Payment of Basic Carrying Costs. Borrower hereby agrees to pay all
Basic Carrying Costs (without regard to the amount of money in the Basic Carrying Costs Sub-Account
or the Basic Carrying Costs Escrow Account). At least ten (10) Business Days prior to the due date
of any Basic Carrying Costs, and not more frequently than once each month, Borrower may notify
Lender in writing and request that Lender pay such Basic Carrying Costs on behalf of Borrower on or
prior to the due date thereof, and, provided that no Event of Default has occurred and is
continuing and that there are sufficient funds available in the Basic Carrying Costs Escrow
Account, Lender shall make such payments out of the Basic Carrying Costs Escrow Account before same
shall be delinquent.

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Together with each such request, Borrower shall furnish Lender with bills and all other
documents necessary, as reasonably determined by Lender, for the payment of the Basic Carrying
Costs which are the subject of such request. Borrower’s obligation to pay (or cause Lender to pay)
Basic Carrying Costs pursuant to this Security Instrument shall include, to the extent permitted by
applicable law, Impositions resulting from future changes in law which impose upon Lender an
obligation to pay any property taxes or other Impositions or which otherwise adversely affect
Lender’s interests.

     Provided that no Event of Default shall have occurred and is continuing, all funds deposited
into the Basic Carrying Costs Escrow Account shall be held by Lender pursuant to the provisions of
this Security Instrument and shall be applied in payment of Basic Carrying Costs in accordance with
the terms hereof. Should an Event of Default occur, the sums on deposit in the Basic Carrying
Costs Sub-Account and the Basic Carrying Costs Escrow Account may be applied by Lender in payment
of any Basic Carrying Costs or may be applied to the payment of the Debt or any other charges
affecting all or any portion of the Cross-collateralized Properties as Lender in its sole
discretion may determine; provided, however, that no such application shall be
deemed to have been made by operation of law or otherwise until actually made by Lender as herein
provided.

     Section 5.07. Intentionally Omitted.

     Section 5.08. Recurring Replacement Reserve Escrow Account. (a) Borrower hereby
agrees to pay all Recurring Replacement Expenditures with respect to the Property (without regard
to the amount of money then available in the Recurring Replacement Reserve Sub-Account or the
Recurring Replacement Reserve Escrow Account). Provided that Lender has received written notice
from Borrower at least five (5) Business Days prior to the due date of any payment relating to
Recurring Replacement Expenditures and not more frequently than once each month, and further
provided that no Event of Default has occurred and is continuing, that there are sufficient funds
available in the Recurring Replacement Reserve Escrow Account and Borrower shall have theretofore
furnished Lender with lien waivers (if the cost incurred in connection therewith is greater than
$25,000), copies of bills, invoices and other reasonable documentation as may be required by Lender
to establish that the Recurring Replacement Expenditures which are the subject of such request
represent amounts due for completed or partially completed capital work and improvements performed
at the Property, Lender shall make such payments out of the Recurring Replacement Reserve Escrow
Account.

     (b) In lieu of making deposits into the Recurring Replacement Reserve Sub-Account, Borrower
may deliver an Approved Letter of Credit to Lender in the amount of the Required RRE Shortfall (as
the same may be amended, replaced, extended or drawn down upon pursuant to the provisions of this
Section 5.08, the “Delivered Letter of Credit”). The Delivered Letter of Credit shall be
held in accordance with this Section 5.08 and otherwise constitute security for the payment of the
Debt. On or prior to the thirtieth (30th) day prior to the expiration of any Delivered
Letter of Credit, Borrower shall provide Lender with a replacement to such Delivered Letter of
Credit which shall be an Approved Letter of Credit, and otherwise in the same form and amount as
the Delivered Letter of Credit being replaced or such other form reasonably approved by Lender. In
the event (i) Borrower shall fail to provide Lender with a replacement Delivered Letter of Credit
on or prior to the thirtieth (30th) day prior to the expiration of any previously
existing Delivered Letter of Credit or (ii) the long-term unsecured debt rating or the short-term
unsecured debt rating of the bank issuing the Delivered Letter of Credit shall be downgraded below
“AA-” (or its equivalent) or “A-1” (or its equivalent), respectively, withdrawn or qualified by any
Rating Agency and the letter of credit required to be delivered hereunder is not replaced within
thirty (30) days of receipt of notice of such downgrading, withdrawal or qualification, Lender may
draw on the Delivered Letter of Credit, deposit all sums received in connection with such draw into
the Recurring Replacement Reserve Sub-Account, and disburse such sums in accordance with Section
5.08 above. Provided no Event of Default shall have occurred and is continuing, upon Lender’s
receipt of a written request from Borrower together with such other documentation as may be
reasonably requested by Lender, Lender shall draw on all or a portion of the Delivered Letter of
Credit, deposit any sums received in connection with such draw into the Recurring Replacement
Reserve Sub-Account, and apply such sums towards the reimbursement of Borrower for the cost of any
Recurring Replacement Expenditures in accordance with the provisions of Section 5.08 hereof. Upon
the occurrence of an Event of Default, Lender may draw on the Delivered Letter of Credit and apply
the sums received towards the payment of Recurring Replacement Expenditures or towards payment of
the Debt or any other charges affecting all or any portion of the Property, as Lender in its sole
discretion may determine; provided, however, that no such application shall be
deemed to have

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been made by operation of law or otherwise until actually made by Lender as herein provided.
Provided that no Event of Default shall have occurred and is continuing, Borrower may deliver to
Lender Dollars in the amount of any Delivered Letter of Credit and, upon receipt of such Dollars,
Lender will return to Borrower the Delivered Letter of Credit.

     (c) Provided that no Event of Default shall have occurred and is continuing, all funds
deposited into the Recurring Replacement Reserve Escrow Account shall be held by Lender pursuant to
the provisions of this Security Instrument and shall be applied in payment of Recurring Replacement
Expenditures. Should an Event of Default occur, the sums on deposit in the Recurring Replacement
Reserve Sub-Account and the Recurring Replacement Reserve Escrow Account may be applied by Lender
in payment of any Recurring Replacement Expenditures or may be applied to the payment of the Debt
or any other charges affecting all or any portion of the Cross-collateralized Properties, as Lender
in its sole discretion may determine; provided, however, that no such application
shall be deemed to have been made by operation of law or otherwise until actually made by Lender as
herein provided.

     Section 5.09. Operation and Maintenance Expense Escrow Account. Borrower hereby
agrees to pay or cause to be paid all Operating Expenses and extraordinary capital improvement
costs with respect to the Property (without regard to the amount of money then available in the
Operation and Maintenance Expense Sub-Account or the Operation and Maintenance Expense Escrow
Account). All funds allocated to the Operation and Maintenance Expense Escrow Account shall be
held by Lender pursuant to the provisions of this Security Instrument. Any sums held in the
Operation and Maintenance Expense Escrow Account shall be disbursed to Borrower within five (5)
Business Days of receipt by Lender from Borrower of (a) a written request for such disbursement
which shall indicate the Operating Expenses (exclusive of Basic Carrying Costs and any management
fees payable to Borrower, or to any Affiliate of Borrower) and/or extraordinary capital improvement
costs approved in writing by Lender for which the requested disbursement is to pay and (b) an
Officer’s Certificate stating that no Operating Expenses with respect to the Property are more than
sixty (60) days past due; provided, however, in the event that Borrower
legitimately disputes any invoice for an Operating Expense and/or extraordinary capital improvement
costs approved in writing by Lender, and (i) no Event of Default has occurred and is continuing
hereunder, (ii) Borrower shall have set aside adequate reserves for the payment of such disputed
sums together with all interest and late fees thereon, (iii) Borrower has complied with all the
requirements of this Security Instrument relating thereto, and (iv) the contesting of such sums
shall not constitute a default under any other instrument, agreement, or document to which Borrower
is a party, then Borrower may, after certifying to Lender as to items (i) through (iv) hereof,
contest such invoice. Together with each such request, Borrower shall furnish Lender with bills
and all other documents necessary for the payment of the Operating Expenses and/or extraordinary
capital improvement costs approved in writing by Lender which are the subject of such request.
Borrower may request a disbursement from the Operation and Maintenance Expense Escrow Account no
more than one (1) time per calendar month. Should an Event of Default occur and be continuing, the
sums on deposit in the Operation and Maintenance Expense Sub-Account or the Operation and
Maintenance Expense Escrow Account may be applied by Lender in payment of any Operating Expenses
and/or extraordinary capital improvement costs for the Cross-collateralized Properties or may be
applied to the payment of the Debt or any other charges affecting all or any portion of the
Property as Lender, in its sole discretion, may determine; provided, however, that
no such application shall be deemed to have been made by operation of law or otherwise until
actually made by Lender as herein provided.

     Section 5.10. Intentionally Omitted.

     Section 5.11. Curtailment Reserve Escrow Account. Funds deposited into the
Curtailment Reserve Escrow Account shall be held by Lender in the Curtailment Reserve Escrow
Account as additional security for the Loan until the Loan has been paid in full. Provided that
no Event of Default has occurred and is continuing, and no O&M Operative Period has existed for
three (3) consecutive calendar months, Lender shall, upon written request from Borrower, release
all sums contained in the Curtailment Reserve Escrow Account and the Operation and Maintenance
Expense Escrow Account to Borrower. Should an Event of Default occur, the sums on deposit in the
Curtailment Reserve Sub-Account and the Curtailment Reserve Escrow Account may be applied by Lender
to the payment of the Debt or other charges affecting all or any portion of the
Cross-collateralized Properties, as Lender, in

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its sole discretion, may determine; provided, however, that no such application shall be
deemed to have been made by operation of law or otherwise until actually made by Lender as herein
provided.

     Section 5.12. Performance of Engineering Work. (a) Borrower shall promptly commence
and diligently thereafter pursue to completion (without regard to the amount of money then
available in the Engineering Escrow Account) the Required Engineering Work prior to the six (6)
month anniversary of the Closing Date. After Borrower completes an item of Required Engineering
Work, Borrower may submit to Lender an invoice therefor with lien waivers and a statement from the
Engineer, reasonably acceptable to Lender, indicating that the portion of the Required Engineering
Work in question has been completed substantially in compliance with all Legal Requirements, and
Lender shall, within twenty (20) days thereafter, although in no event more frequently than once
each month, reimburse such amount to Borrower from the Engineering Escrow Account;
provided, however, that Borrower shall not be reimbursed more than the amount set
forth on Exhibit D hereto as the amount allocated to the portion of the Required Engineering Work
for which reimbursement is sought.

     (b) From and after the date all of the Required Engineering Work is completed, Borrower may
submit a written request, which request shall be delivered together with final lien waivers and a
statement from the Engineer, as the case may be, reasonably acceptable to Lender, indicating that
all of the Required Engineering Work has been completed substantially in compliance with all Legal
Requirements, and Lender shall, within twenty (20) days thereafter, disburse any balance of the
Engineering Escrow Account to Borrower. Should an Event of Default occur, the sums on deposit in
the Engineering Escrow Account may be applied by Lender in payment of any Required Engineering Work
or may be applied to the payment of the Debt or any other charges affecting all or any portion of
the Cross-collateralized Properties, as Lender in its sole discretion may determine;
provided, however, that no such application shall be deemed to have been made by
operation of law or otherwise until actually made by Lender as herein provided.

     Section 5.13. Loss Proceeds. In the event of a casualty to the Property, unless
Lender elects, or is required pursuant to Article III hereof to make all of the Insurance Proceeds
available to Borrower for restoration, Lender and Borrower shall cause all such Insurance Proceeds
to be paid by the insurer directly to the Central Account, whereupon Lender shall, after deducting
Lender’s costs of recovering and paying out such Insurance Proceeds, including without limitation,
reasonable attorneys’ fees, apply same to reduce the Debt in accordance with the terms of the Note;
provided, however, that if Lender elects, or is deemed to have elected, to make the
Insurance Proceeds available for restoration, all Insurance Proceeds in respect of rent loss,
business interruption or similar coverage shall be maintained in the Central Account, to be applied
by Lender in the same manner as Rent received with respect to the operation of the Property;
provided, further, however, that in the event that the Insurance Proceeds
with respect to such rent loss, business interruption or similar insurance policy are paid in a
lump sum in advance, Lender shall hold such Insurance Proceeds in a segregated interest-bearing
escrow account, which shall be an Eligible Account, shall estimate, in Lender’s reasonable
discretion, the number of months required for Borrower to restore the damage caused by the
casualty, shall divide the aggregate rent loss, business interruption or similar Insurance Proceeds
by such number of months, and shall disburse from such bank account into the Central Account each
month during the performance of such restoration such monthly installment of said Insurance
Proceeds minus, if the sum which otherwise would be required to be deposited into the Operation and
Maintenance Expense Sub-Account if a Default Management Period existed, which sum shall be remitted
by Lender to Manager to pay Operating Expenses. In the event that Insurance Proceeds are to be
applied toward restoration, Lender shall hold such funds in a segregated bank account at the Bank,
which shall be an Eligible Account, and shall disburse same in accordance with the provisions of
Section 3.04 hereof. Unless Lender elects, or is required pursuant to Section 6.01 hereof to make
all of the Condemnation Proceeds available to Borrower for restoration, Lender and Borrower shall
cause all such Condemnation Proceeds to be paid to the Central Account, whereupon Lender shall,
after deducting Lender’s costs of recovering and paying out such Condemnation Proceeds, including
without limitation, reasonable attorneys’ fees, apply same to reduce the Debt in accordance with
the terms of the Note; provided, however, that any Condemnation Proceeds received
in connection with a temporary Taking shall be maintained in the Central Account, to be applied by
Lender in the same manner as Rent received with respect to the operation of the Property;
provided, further, however, that in the event that the Condemnation
Proceeds of any such temporary Taking are paid in a lump sum in advance, Lender shall hold such
Condemnation Proceeds in a segregated interest-bearing bank account, which shall be an Eligible
Account, shall estimate, in Lender’s reasonable discretion, the number of months that the Property
shall be affected by such temporary Taking, shall divide the aggregate Condemnation Proceeds in

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connection with such temporary Taking by such number of months, and shall disburse from such
bank account into the Central Account each month during the pendency of such temporary Taking such
monthly installment of said Condemnation Proceeds. In the event that Condemnation Proceeds are to
be applied toward restoration, Lender shall hold such funds in a segregated bank account at the
Bank, which shall be an Eligible Account, and shall disburse same in accordance with the provisions
of Section 3.04 hereof. If any Loss Proceeds are received by Borrower, such Loss Proceeds shall be
received in trust for Lender, shall be segregated from other funds of Borrower, and shall be
forthwith paid into the Central Account, or paid to Lender to hold in a segregated bank account at
the Bank, in each case to be applied or disbursed in accordance with the foregoing. Any Loss
Proceeds made available to Borrower for restoration in accordance herewith, to the extent not used
by Borrower in connection with, or to the extent they exceed the cost of, such restoration, shall
be deposited into the Central Account, whereupon Lender shall apply the same to reduce the Debt in
accordance with the terms of the Note.

     Section 5.14. Intentionally Omitted.

ARTICLE VI: CONDEMNATION

     Section 6.01. Condemnation. (a) Borrower shall notify Lender promptly of the
commencement or threat of any Taking of the Property or any portion thereof. Lender is hereby
irrevocably appointed as Borrower’s attorney-in-fact, coupled with an interest, with exclusive
power to collect, receive and retain the proceeds of any such Taking and to make any compromise or
settlement in connection with such proceedings (subject to Borrower’s reasonable approval, except
after the occurrence of an Event of Default, in which event Borrower’s approval shall not be
required), subject to the provisions of this Security Instrument; provided, however, that Borrower
may participate in any such proceedings and shall be authorized and entitled to compromise or
settle any such proceeding with respect to Condemnation Proceeds in an amount less than five
percent (5%) of the Allocated Loan Amount. Borrower shall execute and deliver to Lender any and
all instruments reasonably required in connection with any such proceeding promptly after request
therefor by Lender. Except as set forth above, Borrower shall not adjust, compromise, settle or
enter into any agreement with respect to such proceedings without the prior consent of Lender. All
Condemnation Proceeds are hereby assigned to and shall be paid to Lender. With respect to
Condemnation Proceeds in an amount in excess of five percent (5%) of the Allocated Loan Amount,
(subject to Borrower’s reasonable approval, except after the occurrence of an Event of Default, in
which event Borrower’s approval shall not be required), Borrower hereby authorizes Lender to
compromise, settle, collect and receive such Condemnation Proceeds, and to give proper receipts and
acquittance therefor. Subject to the provisions of this Article VI, Lender may apply such
Condemnation Proceeds (less any cost to Lender of recovering and paying out such proceeds,
including, without limitation, reasonable attorneys’ fees and disbursements and costs allocable to
inspecting any repair, restoration or rebuilding work and the plans and specifications therefor)
toward the payment of the Debt or to allow such proceeds to be used for the Work.

          (b) “Substantial Taking” shall mean (i) a Taking of such portion of the Property that
would, in Lender’s reasonable discretion, leave remaining a balance of the Property which would not
under then current economic conditions, applicable Development Laws and other applicable Legal
Requirements, permit the restoration of the Property so as to constitute a complete, rentable
facility of the same sort as existed prior to the Taking, having adequate ingress and egress to the
Property, capable of producing a projected Net Operating Income (as reasonably determined by
Lender) yielding a projected Debt Service Coverage therefrom for the next two (2) years of not less
than the Required Debt Service Coverage, (ii) a Taking which occurs less than two (2) years prior
to the Maturity Date, (iii) a Taking which Lender is not reasonably satisfied could be restored
within twelve (12) months and at least six (6) months prior to the Maturity Date or (iv) a Taking
of more than fifteen percent (15%) of the reasonably estimated fair market value of the Property.

          (c) In the case of a Substantial Taking, Condemnation Proceeds shall be payable to Lender in
reduction of the Debt but without any prepayment fee or charge of any kind and, provided that no
Event of Default exists, if Borrower elects to apply any Condemnation Proceeds it may receive
pursuant to this Security Instrument to the payment of the Debt, Borrower may prepay the balance of
the Release Price with respect to the Property without any prepayment fee or charge of any kind.

53

 

          (d) In the event of a Taking which is less than a Substantial Taking, Borrower at its sole
cost and expense (whether or not the award shall have been received or shall be sufficient for
restoration) shall proceed diligently to restore, or cause the restoration of, the remaining
Improvements not so taken, to maintain a complete, rentable, self-contained fully operational
facility of the same sort as existed prior to the Taking in as good a condition as is reasonably
possible. In the event of such a Taking, Lender shall receive the Condemnation Proceeds and shall
pay over the same:

     (i) first, provided no Event of Default shall have occurred, to Borrower to the
extent of any portion of the award as may be necessary to pay the reasonable cost of
restoration of the Improvements remaining, and

     (ii) second, to Lender, in reduction of the Debt without any prepayment premium
or charge of any kind.

  If one or more Takings in the aggregate create a Substantial Taking, then, in such event, the
sections of this Article VI above applicable to Substantial Takings shall apply.

          (e) In the event Lender is obligated to or elects to make Condemnation Proceeds available for
the restoration or rebuilding of the Property, such proceeds shall be disbursed in the manner and
subject to the conditions set forth in Section 3.04(b) hereof. If, in accordance with this Article
VI, any Condemnation Proceeds are used to reduce the Debt, they shall be applied in accordance with
the provisions of the Note. Borrower shall promptly execute and deliver all instruments requested
by Lender for the purpose of confirming the assignment of the Condemnation Proceeds to Lender.
Application of all or any part of the Condemnation Proceeds to the Debt shall be made in accordance
with the provisions of Sections 3.06 and 3.07 hereof. No application of the Condemnation Proceeds
to the reduction of the Debt shall have the effect of releasing the lien of this Security
Instrument until the remainder of the Debt has been paid in full. In the case of any Taking,
Lender, to the extent that Lender has not been reimbursed by Borrower, shall be entitled, as a
first priority out of any Condemnation Proceeds, to reimbursement for all reasonable costs, fees
and expenses reasonably incurred in the determination and collection of any Condemnation Proceeds.
All Condemnation Proceeds deposited with Lender pursuant to this Section, until expended or applied
as provided herein, shall be held in accordance with Section 3.04(b) hereof and shall constitute
additional security for the payment of the Debt and the payment and performance of Borrower’s
obligations, but Lender shall not be deemed a trustee or other fiduciary with respect to its
receipt of such Condemnation Proceeds or any part thereof. All awards so deposited with Lender
shall be held by Lender in an Eligible Account, but Lender makes no representation or warranty as
to the rate or amount of interest, if any, which may accrue on any such deposit and shall have no
liability in connection therewith. For purposes hereof, any reference to the award shall be deemed
to include interest, if any, which has accrued thereon.

ARTICLE VII:  LEASES AND RENTS

     Section 7.01. Assignment. (a) Borrower does hereby bargain, sell, assign and set over
unto Lender, all of Borrower’s interest in the Leases and Rents. The assignment of Leases and
Rents in this Section 7.01 is an absolute, unconditional and present assignment from Borrower to
Lender and not an assignment for security and the existence or exercise of Borrower’s revocable
license to collect Rent shall not operate to subordinate this assignment to any subsequent
assignment. The exercise by Lender of any of its rights or remedies pursuant to this Section 7.01
shall not be deemed to make Lender a mortgagee-in-possession. In addition to the provisions of
this Article VII, Borrower shall comply with all terms, provisions and conditions of the
Assignment.

     (b) So long as there shall exist and be continuing no Event of Default, Borrower shall have a
revocable license to take all actions with respect to all Leases and Rents, present and future,
including the right to collect and use the Rents, subject to the terms of this Security Instrument
and the Assignment.

     (c) In a separate instrument Borrower shall, as requested from time to time by Lender, assign
to Lender or its nominee by specific or general assignment, any and all Leases, such assignments to
be in form and

54

 

content reasonably acceptable to Lender, but subject to the provisions of Section 7.01(a) and
(b) hereof. Borrower agrees to deliver to Lender, within thirty (30) days after Lender’s request,
a true and complete copy of every Lease.

     (d) The rights of Lender contained in this Article VII, the Assignment or any other assignment
of any Lease shall not result in any obligation or liability of Lender to Borrower or any lessee
under a Lease or any party claiming through any such lessee.

     (e) At any time during the continuance of an Event of Default, the license granted hereinabove
may be revoked by Lender, and Lender or a receiver appointed in accordance with this Security
Instrument may enter upon the Property, and collect, retain and apply the Rents toward payment of
the Debt in such priority and proportions as Lender in its sole discretion shall deem proper.

     (f) In addition to the rights which Lender may have herein, during the continuance of any
Event of Default, Lender, at its option, may 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 used and occupied by Borrower and may require
Borrower to vacate and surrender possession of the Property to Lender or to such receiver and, in
default thereof, Borrower may be evicted by summary proceedings or otherwise.

     Section 7.02. Management of Property. (a) Borrower shall manage the Property or cause
the Property to be managed in a manner which is consistent with the Approved Manager Standard. All
Space Leases shall provide for rental rates comparable to then existing local market rates and
terms and conditions which constitute good and prudent business practice and are consistent with
prevailing market terms and conditions, and shall be arms-length transactions. All Space Leases
entered into after the date hereof shall provide that they are subordinate to this Security
Instrument and that the lessees thereunder attorn to Lender. Borrower shall deliver copies of all
Leases, amendments, modifications and renewals thereof to Lender. All proposed Leases for the
Property shall be subject to the prior written approval of Lender, not to be unreasonably withheld,
conditioned or delayed, provided, however that Borrower may enter into new leases with unrelated
third parties without obtaining the prior consent of Lender provided that: (i) the proposed leases
conform with the requirements of this Section 7.02; (ii) the proposed Space Lease is not a Major
Space Lease and the space to be leased pursuant to such proposed lease together with any space
leased or to be leased to an Affiliate of the tenant thereunder does not exceed 10,000 square feet;
and (iii) the term of the proposed lease inclusive of all extensions and renewals, does not exceed
ten (10) years.

     (b) Borrower (i) shall or shall cause Operating Tenant to observe and perform all of its
material obligations under the Leases pursuant to applicable Legal Requirements and shall not do or
permit to be done anything to impair the value of the Major Space Leases as security for the Debt;
(ii) shall promptly send copies to Lender of all notices of default which Borrower shall receive
under the Major Space Leases; (iii) shall, consistent with the Approved Manager Standard, enforce
all of the terms, covenants and conditions contained in the Leases to be observed or performed;
(iv) shall not collect any of the Rents under the Major Space Leases more than one (1) month in
advance (except that Borrower may collect in advance such security deposits as are permitted
pursuant to applicable Legal Requirements and are commercially reasonable in the prevailing
market); (v) shall not execute any other assignment of lessor’s interest in the Leases or the Rents
except as otherwise expressly permitted pursuant to this Security Instrument; (vi) shall not cancel
or terminate any of the Leases or accept a surrender thereof in any manner inconsistent with the
Approved Manager Standard; (vii) shall not convey, transfer or suffer or permit a conveyance or
transfer of all or any part of the Premises or the Improvements or of any interest therein so as to
effect a merger of the estates and rights of, or a termination or diminution of the obligations of,
lessees thereunder; (viii) shall not alter, modify or change the terms of any guaranty of any Major
Space Lease or cancel or terminate any such guaranty in a manner inconsistent with the Approved
Manager Standard; (ix) shall, in accordance with the Approved Manager Standard, make all reasonable
efforts to seek lessees for space as it becomes vacant and enter into Leases in accordance with the
terms hereof; (x) shall not cancel or terminate or materially modify, alter or amend any Major
Space Lease or Property Agreement without Lender’s consent, which consent will not be unreasonably
withheld or delayed; and (xi) shall, without limitation to any other provision hereof, execute and
deliver at the request of Lender all such further assurances, confirmations and assignments in
connection with the Property as are required herein and as Lender shall from time to time
reasonably require.

55

 

     (c) All security deposits shall be held in accordance with all Legal Requirements. Following
the occurrence and during the continuance of any Event of Default, Borrower shall, upon Lender’s
request, if permitted by applicable Legal Requirements, turn over the security deposits (and any
interest thereon) to Lender to be held by Lender in accordance with the terms of the Leases and all
Legal Requirements.

     (d) If requested by Lender, Borrower shall furnish, or shall cause the applicable lessee to
furnish, to Lender financial data and/or financial statements in accordance with Regulation AB for
any lessee of the Property if, in connection with a Securitization, Lender expects there to be,
with respect to such lessee or any group of affiliated lessees, a concentration within all of the
mortgage loans included or expected to be included, as applicable, in such Securitization such that
such lessee or group of affiliated lessees would constitute a Significant Obligor; provided,
however, that in the event the related Space Lease does not require the related lessee to provide
the foregoing information, Borrower shall use commercially reasonable efforts to cause the
applicable lessee to furnish such information.

     (e) Borrower covenants and agrees with Lender that (i) the Property will be managed at all
times by an Approved Manager pursuant to the management agreement approved by Lender (the
“Management Agreement”), such approval not to be unreasonably withheld or delayed, (ii)
after Borrower has knowledge of a fifty percent (50%) or more change in control of the ownership of
Manager, Borrower will promptly give Lender notice thereof (a “Manager Control Notice”) and
(iii) the Management Agreement may be terminated by Lender at any time (A) for cause to the extent
provided in the Management Agreement (including, but not limited to, Manager’s gross negligence,
misappropriation of funds, willful misconduct or fraud) following the occurrence of an Event of
Default of the type set forth in Section 13.01(a) through (c), or (B) to the extent provided in the
Management Agreement, following the receipt of a Manager Control Notice and a substitute Approved
Manager shall be appointed by Borrower. Notwithstanding the foregoing, transfers of publicly
traded stock of Manager on a national stock exchange or on the NASDAQ Stock Market in the normal
course of business and not in connection with a tender offer or sale of Manager or substantially
all of the assets of Manager shall not require the giving of a Manager Control Notice. Borrower
may from time to time appoint a successor manager to manage the Property, provided that any such
successor manager shall be an Approved Manager. Borrower further covenants and agrees that
Borrower shall require Manager (or any successor managers) to maintain at all times during the term
of the Loan worker’s compensation insurance as required by Governmental Authorities.

     (f) Borrower shall not enter into any new or replacement Franchise Agreement without obtaining
the prior written consent of Lender, such consent not to be unreasonably withheld, conditioned or
delayed (provided that any Franchise Agreement which is on a form in all material respects
(including, without limitation, all fees due thereunder) the same as the form of any Franchise
Agreement which is contained in the uniform franchise offering circular for any Approved Franchisor
shall be deemed an acceptable form), and shall (i) pay or shall cause to be paid all sums required
to be paid by Borrower under any Franchise Agreement and Operating Lease, (ii) diligently perform
and observe all of the material terms, covenants and conditions of any Franchise Agreement on the
part of Borrower to be performed and observed to the end that all things shall be done which are
necessary to keep unimpaired the rights of Borrower under any Franchise Agreement and Operating
Lease, (iii) promptly notify Lender of the giving of any notice to Borrower of any material default
by Borrower in the performance or observance of any of the terms, covenants or conditions of and
Franchise Agreement or Operating Lease on the part of Borrower to be performed and observed and
deliver to Lender a true copy of each such notice, and (iv) promptly deliver to Lender a copy of
each financial statement, business plan, capital expenditures plan, report and estimate received by
it under the Franchise Agreement or the Management Agreement or the Operating Lease. Borrower
shall not, without the prior consent of the Lender, such consent not to be unreasonably withheld,
conditioned or delayed, surrender any Franchise Agreement or Operating Lease or terminate or cancel
any Franchise Agreement or modify, change, supplement, alter or amend any Franchise Agreement or
Operating Lease, in any material respect, either orally or in writing, and Borrower hereby assigns
to Lender as further security for the payment of the Debt and for the performance and observance of
the terms, covenants and conditions of this Security Instrument, all the rights, privileges and
prerogatives of Borrower to surrender any Franchise Agreement or Operating Lease or to terminate,
cancel, modify, change, supplement, alter or amend any Franchise Agreement or Operating Lease in
any respect, and any such surrender of any Franchise Agreement or termination, cancellation,
modification, change, supplement, alteration or amendment of any Franchise Agreement or Operating
Lease without the prior consent of

56

 

Lender shall be void and of no force and effect, provided, however, Borrower may terminate any
Franchise Agreement if Borrower enters into a new Franchise Agreement with an Approved Franchisor
pursuant to a Franchise Agreement which is reasonably acceptable to Lender. Notwithstanding the
foregoing, Borrower may renew or replace any Operating Lease, provided such renewal or replacement
shall be upon the same terms and conditions as the Operating Lease being renewed or replaced,
except rent payable thereunder may be adjusted to the extent necessary to comply with the
then-current requirements of the Code for real estate investment trusts. If Borrower shall default
in the performance or observance of any material term, covenant or condition of any Franchise
Agreement or Operating Lease on the part of Borrower to be performed or observed, then, without
limiting the generality of the other provisions of this Security Instrument, and without waiving or
releasing Borrower from any of its obligations hereunder, Lender shall have the right, but shall be
under no obligation, to pay any sums and to perform any act or take any action as may be
appropriate to cause all the terms, covenants and conditions of any Franchise Agreement or
Operating Lease on the part of Borrower to be performed or observed to be promptly performed or
observed on behalf of Borrower, to the end that the rights of Borrower in, to and under any
Franchise Agreement and Operating Lease shall be kept unimpaired and free from default. Lender and
any Person designated by Lender shall have, and are hereby granted, the right to enter upon the
Property at any time and from time to time for the purpose of taking any such action. If the
franchisor under any Franchise Agreement or lessee under an Operating Lease shall deliver to Lender
a copy of any notice sent to Borrower of default under any Franchise Agreement or Operating Lease,
as applicable, such notice shall constitute full protection to Lender for any action to be taken by
Lender in good faith, in reliance thereon. Borrower shall, from time to time, use its best efforts
to obtain from the franchisor or lessee under any Franchise Agreement such certificates of estoppel
with respect to compliance by Borrower with the terms of any Franchise Agreement as may be
requested by Lender. Borrower shall exercise each individual option, if any, to extend or renew
the term of any Franchise Agreement within four (4) months of the last day upon which any such
option may be exercised, unless Lender consents to the non-renewal of such Franchise Agreement in
writing, and Borrower hereby expressly authorizes and appoints Lender its attorney-in-fact to
exercise any such option in the name of and upon behalf of Borrower, which power of attorney shall
be irrevocable and shall be deemed to be coupled with an interest, provided, however, that Lender
shall not exercise such power of attorney unless and until Borrower fails to take the actions
required herein.

     (g) Intentionally Omitted.

     (h) Borrower shall fund and operate, or shall cause Manager to fund and operate, the Property
in a manner consistent with a hotel of the same type and category as the Property and in compliance
in all material respects with any Franchise Agreement and Operating Lease.

     (i) Borrower shall maintain or cause Operating Tenant to cause Manager to maintain Inventory
in kind and amount sufficient to meet hotel industry standards for hotels comparable to the hotel
located at the Premises and at levels sufficient for the operation of the hotel located at the
Premises at historic occupancy levels.

     (j) Borrower shall deliver to Lender all notices of default or termination received by
Borrower, Operating Tenant or Manager with respect to any licenses and permits, contracts, Property
Agreements or insurance policies within three (3) Business Days of receipt of the same.

     (k) Borrower shall not permit any Equipment or other personal property to be removed from the
Property unless the removed item is consumed or sold in the ordinary course of business, removed
temporarily for maintenance and repair, or, if removed permanently, replaced by an article of
equivalent suitability and not materially less value, owned by Borrower free and clear of any lien.

ARTICLE VIII:  MAINTENANCE AND REPAIR

     Section 8.01. Maintenance and Repair of the Property; Alterations; Replacement of
Equipment. Borrower hereby covenants and agrees:

     (a) Borrower shall not (i) desert or abandon the Property, (ii) change the use of the Property
or cause or permit the use or occupancy of any part of the Property to be discontinued if such
discontinuance or use change

57

 

would violate any zoning or other law, ordinance or regulation; (iii) consent to or seek any
lowering of the zoning classification, or greater zoning restriction affecting the Property; or
(iv) take any steps whatsoever to convert the Property, or any portion thereof, to a condominium or
cooperative form of ownership.

     (b) Borrower shall, or shall cause Operating Tenant to, at its expense, (i) take good care of
the Property including grounds generally, and utility systems and sidewalks, roads, alleys, and
curbs therein, and shall keep the same in good, safe and insurable condition and in compliance with
all applicable Legal Requirements, (ii) promptly make all necessary repairs to the Property, above
grade and below grade, interior and exterior, structural and nonstructural, ordinary and
extraordinary, unforeseen and foreseen, and maintain the Property in a manner appropriate for the
facility and (iii) not commit or suffer to be committed any waste of the Property or do or suffer
to be done anything which will impair the value of the Property or increase in any respect the risk
of fire or other hazard to the Property. Borrower shall keep the sidewalks, vaults, gutters and
curbs comprising, or adjacent to, the Property, clean and free from dirt, snow, ice, rubbish and
obstructions. All repairs made by Borrower shall be made with first-class materials, in a good and
workmanlike manner, shall be equal or better in quality and class to the original work and shall
comply with all applicable Legal Requirements and Insurance Requirements. To the extent any of the
above obligations are obligations of tenants under Space Leases or other Persons under Property
Agreements, Borrower may fulfill its obligations hereunder by causing such tenants or other
Persons, as the case may be, to perform their obligations thereunder. As used herein, the terms
“repair” and “repairs” shall be deemed to include all necessary replacements.

     (c) Borrower shall not demolish, remove, construct, or, except as otherwise expressly provided
herein, restore, or alter the Property or any portion thereof, nor consent to or permit any such
demolition, removal, construction, restoration, addition or alteration, which would diminish the
value of the Property without Lender’s prior written consent in each instance, which consent shall
not be unreasonably withheld or delayed.

     (d) Borrower represents and warrants to Lender that together with Equipment owned by
Operating Tenant and Manager (i) there are no fixtures, machinery, apparatus, tools, equipment or
articles of personal property attached or appurtenant to, or located on, or used in connection with
the management, operation or maintenance of the Property, except for the Equipment and equipment
leased by Borrower and/or Operating Tenant and/or Manager for the management, operation or
maintenance of the Property in accordance with the Loan Documents; (ii) the Equipment and the
leased equipment constitute all of the fixtures, machinery, apparatus, tools, equipment and
articles of personal property necessary to the proper operation and maintenance of the Property;
and (iii) all of the Equipment is free and clear of all liens, except for the lien of this Security
Instrument and the Permitted Encumbrances. All right, title and interest of Borrower in and to all
extensions, improvements, betterments, renewals and appurtenances to the Property hereafter
acquired by, or released to, Borrower or constructed, assembled or placed by Borrower in the
Property, and all changes and substitutions of the security constituted thereby, shall be and, in
each such case, without any further mortgage, encumbrance, conveyance, assignment or other act by
Lender or Borrower, shall become subject to the lien and security interest of this Security
Instrument as fully and completely, and with the same effect, as though now owned by Borrower and
specifically described in this Security Instrument, but at any and all times Borrower shall execute
and deliver to Lender any documents Lender may reasonably deem necessary or appropriate for the
purpose of specifically subjecting the same to the lien and security interest of this Security
Instrument.

     (e) Notwithstanding the provisions of this Security Instrument to the contrary, Borrower shall
have the right, at any time and from time to time, to remove and dispose of Equipment which may
have become obsolete or unfit for use or which is no longer useful in the management, operation or
maintenance of the Property. Borrower shall promptly replace any such Equipment so disposed of or
removed with other Equipment of equal value and utility, free of any security interest or superior
title, liens or claims; except that, if by reason of technological or other developments,
replacement of the Equipment so removed or disposed of is not necessary or desirable for the proper
management, operation or maintenance of the Property, Borrower shall not be required to replace the
same. All such replacements or additional equipment shall be deemed to constitute “Equipment” and
shall be covered by the security interest herein granted.

58

 

ARTICLE IX:  TRANSFER OR ENCUMBRANCE OF THE PROPERTY

     Section 9.01. Other Encumbrances. Borrower shall not further encumber or permit the
further encumbrance in any manner (whether by grant of a pledge, security interest or otherwise) of
the Property or any part thereof or interest therein, including, without limitation, of the Rents
therefrom. In addition, except for a Permitted Encumbrance, Borrower shall not further encumber
and shall not permit the further encumbrance in any manner (whether by grant of a pledge, security
interest or otherwise) of Borrower or any direct or indirect interest in Borrower except as
expressly permitted pursuant to this Security Instrument.

     Section 9.02. No Transfer. Borrower acknowledges that Lender has examined and relied
on the expertise of Borrower and, if applicable, each General Partner, 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 Borrower acknowledges that Lender has a valid interest in
maintaining the value of the Property. Borrower shall not Transfer, other than Permitted
Transfers, nor permit any Transfer, other than Permitted Transfers, without the prior written
consent of Lender, which consent Lender may withhold in its sole and absolute discretion. 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 a Transfer without
Lender’s consent. This provision shall apply to every Transfer regardless of whether voluntary or
not, or whether or not Lender has consented to any previous Transfer.

     Section 9.03. Due on Sale. Lender may declare the Debt immediately due and payable
upon any Transfer, other than Permitted Transfers, or further encumbrance without Lender’s consent
without regard to whether any impairment of its security or any increased risk of default hereunder
can be demonstrated. This provision shall apply to every Transfer or further encumbrance of the
Property or any part thereof or interest in the Property or in Borrower regardless of whether
voluntary or not, or whether or not Lender has consented to any previous Transfer or further
encumbrance of the Property or interest in Borrower.

ARTICLE X:  CERTIFICATES

     Section 10.01. Estoppel Certificates. (a) After request by Lender, Borrower, within
fifteen (15) days and at its expense, will furnish Lender with a statement, duly acknowledged and
certified, setting forth (i) the amount of the original principal amount of the Note, and the
unpaid principal amount of the Note, (ii) the rate of interest of the Note, (iii) the date payments
of interest and/or principal were last paid, (iv) any offsets or defenses to the payment of the
Debt that Borrower shall have knowledge of, and if any are alleged, the nature thereof, (v) that
the Note, this Security Instrument and the other Loan Documents have not been modified or if
modified, giving particulars of such modification and (vi) that to Borrower’s best knowledge, there
has occurred and is then continuing no Default or if such Default exists, the nature thereof, the
period of time it has existed, and the action being taken to remedy such Default.

     (b) Within fifteen (15) days after written request by Borrower, Lender shall furnish to
Borrower a written statement confirming the amount of the Debt, the maturity date of the Note and
the date to which interest has been paid.

     (c) At Lender’s request Borrower shall use all reasonable efforts to obtain estoppel
certificates from tenants in form and substance reasonably acceptable to Lender.

ARTICLE XI:  NOTICES

     Section 11.01. Notices. Any notice, demand, statement, request or consent made
hereunder shall be in writing and delivered personally or sent to the party to whom the notice,
demand or request is being made by Federal Express or other nationally recognized overnight
delivery service, as follows and shall be deemed given (a) when delivered personally, (b) on the
date of sending by telefax if sent during normal business hours on a Business Day (otherwise on the
next Business Day) provided that any notice given by telefax is also given by at least one

59

 

other method provided herein, or (c) one (1) Business Day after being deposited with Federal
Express or such other nationally recognized delivery service:

	 	 	 	 	 
	 

	 	If to Lender:
	 	Wachovia Bank, National Association
	 

	 	 	 	Commercial Real Estate Services
	 

	 	 	 	8739 Research Drive URP 4 
	 

	 	 	 	NC 1075
	 

	 	 	 	Charlotte, North Carolina 28262
	 

	 	 	 	Loan Number: 502860049
	 

	 	 	 	Attention: Portfolio Management
	 

	 	 	 	Fax No.: (704) 715-0036
	 
	 	 	 	 
	 

	 	with a copy to:
	 	Proskauer Rose llp
	 

	 	 	 	1585 Broadway 
	 

	 	 	 	New York, New York 10036
	 

	 	 	 	Attn: David J. Weinberger, Esq.
	 

	 	 	 	Fax No.: (212) 969-2900
	 
	 	 	 	 
	 

	 	If to Borrower:
	 	c/o Ashford Hospitality Trust, Inc.
	 

	 	 	 	14185 Dallas Parkway, Suite 1100 
	 

	 	 	 	Dallas, Texas 75254-4308
	 

	 	 	 	Attn: David Brooks
	 

	 	 	 	Facsimile: (972) 778-9270
	 

	 	 	 	E-mail: dbrooks@ahreit.com
	 
	 	 	 	 
	 

	 	with a copy to:
	 	Akin Gump Strauss Hauer & Feld LLP
	 

	 	 	 	590 Madison Avenue 
	 

	 	 	 	New York, New York 10022-2524
	 

	 	 	 	Attn: Peter Miller, Esq.
	 

	 	 	 	Facsimile: (212) 872-1002
	 

	 	 	 	E-mail: pamiller@akingump.com,

or such other address as either Borrower or Lender shall hereafter specify by not less than ten
(10) days prior written notice as provided herein; provided, however, that notwithstanding any
provision of this Article to the contrary, such notice of change of address shall be deemed given
only upon actual receipt thereof. Rejection or other refusal to accept or the inability to deliver
because of changed addresses of which no notice was given as herein required shall be deemed to be
receipt of the notice, demand, statement, request or consent.

ARTICLE XII:  INDEMNIFICATION

     Section 12.01. Indemnification Covering Property. In addition, and without
limitation, to any other provision of this Security Instrument or any other Loan Document, Borrower
shall protect, indemnify and save harmless Lender and its successors and assigns, and each of their
agents, employees, officers, directors, stockholders, partners and members (collectively,
“Indemnified Parties”) for, from and against any claims, demands, penalties, fines,
liabilities, settlements, damages, costs and expenses of whatever kind or nature, known or unknown,
contingent or otherwise, whether incurred or imposed within or outside the judicial process,
including, without limitation, reasonable attorneys’ fees and disbursements imposed upon or
incurred by or asserted against any of the Indemnified Parties by reason of (a) ownership of this
Security Instrument, the Assignment, the Property or any part thereof or any interest therein or
receipt of any Rents; (b) any accident, injury to or death of any person or loss of or damage to
property occurring in, on or about the Property or any part thereof or on the adjoining sidewalks,
curbs, parking areas, streets or ways; (c) any use, nonuse or condition in, on or about, or
possession, alteration, repair, operation, maintenance or management of, the Property or any part
thereof or on the adjoining sidewalks, curbs, parking areas, streets or ways; (d) any failure on
the part of Borrower to perform or comply with any of the terms of this Security Instrument or the
Assignment; (e) performance of any labor or services or the furnishing of any

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materials or other property in respect of the Property or any part thereof; (f) any claim by
brokers, finders or similar Persons claiming to be entitled to a commission in connection with any
Lease or other transaction involving the Property or any part thereof; (g) any Imposition
including, without limitation, any Imposition attributable to the execution, delivery, filing, or
recording of any Loan Document, Lease or memorandum thereof; (h) any lien or claim arising on or
against the Property or any part thereof under any Legal Requirement or any liability asserted
against any of the Indemnified Parties with respect thereto; (i) any claim arising out of or in any
way relating to any tax or other imposition on the making and/or recording of this Security
Instrument, the Note or any of the other Loan Documents; (j) a Default under Sections 2.02(f),
2.02(g), 2.02(k), 2.02(t) or 2.02(w) hereof, (k) 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 and Barter Exchange Transactions, which may be required in connection with the Loan,
or to supply a copy thereof in a timely fashion to the recipient of the proceeds of the Loan; (l)
the claims of any lessee or any Person acting through or under any lessee or otherwise arising
under or as a consequence of any Lease or (m) the failure to pay any insurance premiums.
Notwithstanding the foregoing provisions of this Section 12.01 to the contrary, Borrower shall have
no obligation to indemnify the Indemnified Parties pursuant to this Section 12.01 for liabilities,
obligations, claims, damages, penalties, causes of action, costs and expenses relative to the
foregoing which result from Lender’s, and its successors’ or assigns’, willful misconduct or gross
negligence or with respect to matters which first occur after Lender has taken title to the
Property through a foreclosure or delivery of a deed in lieu thereof. Any amounts payable to
Lender by reason of the application of this Section 12.01 shall constitute a part of the Debt
secured by this Security Instrument and the other Loan Documents and shall become immediately due
and payable and shall bear interest at the Default Rate from the date the liability, obligation,
claim, cost or expense is sustained by Lender, as applicable, until paid. The provisions of this
Section 12.01 shall survive the termination of this Security Instrument whether by repayment of the
Debt, foreclosure or delivery of a deed in lieu thereof, assignment or otherwise. In case any
action, suit or proceeding is brought against any of the Indemnified Parties by reason of any
occurrence of the type set forth in (a) through (m) above, Borrower shall, at Borrower’s expense,
resist and defend such action, suit or proceeding or will cause the same to be resisted and
defended by counsel at Borrower’s expense for the insurer of the liability or by counsel designated
by Borrower (unless reasonably disapproved by Lender promptly after Lender has been notified of
such counsel); provided, however, that nothing herein shall compromise the right of
Lender (or any other Indemnified Party) to appoint its own counsel at Borrower’s expense for its
defense with respect to any action which, in the reasonable opinion of Lender or such other
Indemnified Party, as applicable, presents a conflict or potential conflict between Lender or such
other Indemnified Party that would make such separate representation advisable. Any Indemnified
Party will give Borrower prompt notice after such Indemnified Party obtains actual knowledge of any
potential claim by such Indemnified Party for indemnification hereunder. The Indemnified Parties
shall not settle or compromise any action, proceeding or claim as
to which it is indemnified
hereunder without notice to Borrower. Notwithstanding the foregoing, so long as no Default has
occurred and is continuing and Borrower is resisting and defending such action, suit or proceeding
as provided above in a prudent and commercially reasonable manner, in order to obtain the benefit
of this Section 12.01 with respect to such action, suit or proceeding, Lender and the Indemnified
Parties agree that they shall not settle such action, suit or proceeding without obtaining
Borrower’s consent which Borrower agrees not to unreasonably withhold, condition or delay;
provided, however, (x) if Borrower is not diligently defending such action, suit
or proceeding in a prudent and commercially reasonable manner as provided above and Lender has
provided Borrower with thirty (30) days’ prior written notice, or shorter period if mandated by the
requirements of the applicable law, and Borrower has failed to correct such failure, or (y) failure
to settle could, in Lender’s reasonable judgment, expose Lender to criminal liability, Lender may
settle such action, suit or proceeding without the consent of Borrower and be entitled to the
benefits of this Section 12.01 with respect to the settlement of such action, suit or proceeding.

ARTICLE XIII:  DEFAULTS

     Section 13.01. Events of Default. The Debt shall become immediately due at the option
of Lender upon any one or more of the following events (“Event of Default”):

     (a) if the final payment or prepayment premium, if any, due under the Note shall not be paid
on Maturity;

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     (b) if any monthly payment of interest and/or principal due under the Note (other than the
sums described in (a) above) shall not be fully paid on the date upon which the same is due and
payable thereunder; provided, that the failure of any such amount to be paid when due shall not be
an Event of Default if adequate funds were on deposit in the relevant Sub-Account (or would have
been on deposit therein if Lender had timely allocated such funds thereto from the Central Account
and/or the Collection Account in accordance with the provisions of Article V hereof);

     (c) if payment of any sum (other than the sums described in (a) above or (b) above) required
to be paid pursuant to the Note, this Security Instrument or any other Loan Document shall not be
paid within five (5) Business Days after Lender delivers written notice to Borrower that same is
due and payable thereunder or hereunder;

     (d) if Borrower, Operating Tenant, Guarantor or, if Borrower, Operating Tenant or Guarantor is
a partnership, any general partner of Borrower, Operating Tenant or Guarantor, or, if Borrower,
Operating Tenant or Guarantor is a limited liability company, any managing member of Borrower,
Operating Tenant or Guarantor, shall institute or cause to be instituted any proceeding for the
termination or dissolution of Borrower, Operating Tenant, Guarantor or any such general partner or
member;

     (e) if (i) Borrower fails to deliver to Lender the original insurance policies or certificates
as herein provided (provided, however, that if the insurance policies required by this Security
Instrument are maintained in full force and effect, then Borrower shall have five (5) Business Days
after notice from Lender of Borrower’s failure to deliver the original policies or certificates
(whichever has not been delivered as required) to deliver same to Lender before such failure
becomes an Event of Default) or (ii) if the insurance policies required hereunder are not kept in
full force and effect as herein provided (no notice or cure period applies to this item (ii));

     (f) if Borrower or Guarantor attempts to assign its rights under this Security Instrument or
any other Loan Document or any interest herein or therein, or if any Transfer occurs other than in
accordance with the provisions hereof;

     (g) if any representation or warranty of Borrower or Guarantor made herein or in any other
Loan Document or in any certificate, report, financial statement or other instrument or agreement
furnished to Lender shall prove false or misleading in any material respect as of the date made;
provided, however, that if such representation or warranty which was false or misleading in any
material respect is, by its nature, curable and is not reasonably likely to have a Material Adverse
Effect, and such representation or warranty was not, to the best of Borrower’s knowledge, false or
misleading in any material respect when made, then the same shall not constitute an Event of
Default unless Borrower has not cured the same within five (5) Business Days after receipt by
Borrower of notice from Lender in writing of such breach;

     (h) if Borrower, Operating Tenant, Guarantor or any general partner of Borrower, Operating
Tenant or Guarantor shall make an assignment for the benefit of creditors or shall admit in writing
its inability to pay its debts generally as they become due;

     (i) if a receiver, liquidator or trustee of Borrower, Operating Tenant, Guarantor or any
general partner of Borrower, Operating Tenant or Guarantor shall be appointed or if Borrower,
Operating Tenant, Guarantor or their respective general partners shall be adjudicated a bankrupt or
insolvent, or if any petition for bankruptcy, reorganization or arrangement pursuant to federal
bankruptcy law, or any similar federal or state law, shall be filed by or against, consented to, or
acquiesced in, by Borrower, Operating Tenant, Guarantor or their respective general partners or if
any proceeding for the dissolution or liquidation of Borrower, Operating Tenant, Guarantor or their
respective general partners shall be instituted; however, if such appointment, adjudication,
petition or proceeding was involuntary and not consented to by Borrower, Operating Tenant,
Guarantor or their respective general partners, as applicable, upon the same not being discharged,
stayed or dismissed within ninety (90) days or if Borrower, Operating Tenant, Guarantor or their
respective general partners shall generally not be paying its debts as they become due;

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     (j) if Borrower shall be in default beyond any notice or grace period, if any, under any other
mortgage or deed of trust or security agreement covering any part of the Property without regard to
its priority relative to this Security Instrument; provided, however, this provision shall not be
deemed a waiver of the provisions of Article IX prohibiting further encumbrances affecting the
Property or any other provision of this Security Instrument;

     (k) if the Property becomes subject (i) to any lien which is superior to the lien of this
Security Instrument, other than a lien for real estate taxes and assessments not due and payable,
or (ii) to any mechanic’s, materialman’s or other lien which is or is asserted to be superior to
the lien of this Security Instrument, and such lien shall remain undischarged (by payment, bonding,
or otherwise) for fifteen (15) days unless contested in accordance with the terms hereof;

     (l) if Borrower discontinues the operation of the Property or any material part thereof for
reasons other than repair or restoration arising from a casualty or condemnation or any renovation
project for ten (10) days or more;

     (m) except as permitted in this Security Instrument, any material alteration, demolition or
removal of any of the Improvements without the prior consent of Lender;

     (n) if Borrower consummates a transaction which would cause this Security Instrument or
Lender’s rights under this Security Instrument, the Note or any other Loan Document to constitute a
non-exempt prohibited transaction under ERISA or result in a violation of a state statute
regulating government plans subjecting Lender to liability for a violation of ERISA or a state
statute;

     (o) if a default by Borrower beyond applicable notice and grace periods, if any, occurs under
the Franchise Agreement or Operating Lease, or if the Franchise Agreement or Operating Lease is
terminated, or if, without Lender’s prior written consent, there is a material change to the
Franchise Agreement or Operating Lease unless, with respect to any default under or termination of
the Franchise Agreement, Borrower enters into a replacement Franchise Agreement within thirty (30)
days of the termination or receipt of notice of any such default, as applicable, in accordance with
the terms hereof;

     (p) if an Event of Default shall occur and be continuing under any of the other
Cross-collateralized Mortgages;

     (q) if Borrower is a tenancy-in-common, if any TIC brings a partition action without first
offering its interest to the other TICs or if, upon the making of such offer, one or more of the
TICs does not purchase the tenant-in-common interest of the TIC which desires to bring a partition
action;

     (r) if Borrower is a tenancy-in-common, if the TIC Agreement is modified without the prior
written consent of Lender or if the Person appointed in the TIC Agreement as manager is replaced or
removed without obtaining the prior written consent of Lender; or

     (s) if a default shall occur under any of the other terms, covenants or conditions of the
Note, this Security Instrument or any other Loan Document, other than as set forth in (a) through
(r) above, for ten (10) days after notice from Lender in the case of any default which can be cured
by the payment of a sum of money, or for thirty (30) days after notice from Lender in the case of
any other default or an additional ninety (90) days if Borrower is diligently and continuously
effectuating a cure of a curable non-monetary default, other than as set forth in (a) through (r)
above.

     Section 13.02. Remedies. (a) Upon the occurrence and during the continuance of any
Event of Default, Lender may, in addition to any other rights or remedies available to it hereunder
or under any other Loan Document, at law or in equity, take such action, without notice or demand,
as it reasonably deems advisable to protect and enforce its rights against Borrower or any one or
more of the Cross-collateralized Borrowers and in and to the Property or any one or more of the
Cross-collateralized Properties including, but not limited to, the following

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actions, each of which may be pursued singly, concurrently or otherwise, at such time and in
such order as Lender may determine, in its sole discretion, without impairing or otherwise
affecting any other rights and remedies of Lender hereunder, at law or in equity: (i) declare all
or any portion of the unpaid Debt to be immediately due and payable; provided, however, that upon
the occurrence of any of the events specified in Section 13.01(i), the entire Debt will be
immediately due and payable without notice or demand or any other declaration of the amounts due
and payable; or (ii) bring an action to foreclose this Security Instrument and without applying for
a receiver for the Rents, but subject to the rights of the tenants under the Leases, enter into or
upon the Property or any part thereof, either personally or by its agents, nominees or attorneys,
and dispossess Borrower and its agents and servants therefrom, and thereupon Lender may (A) use,
operate, manage, control, insure, maintain, repair, restore and otherwise deal with all and every
part of the Property and conduct the business thereat, (B) make alterations, additions, renewals,
replacements and improvements to or on the Property or any part thereof, (C) exercise all rights
and powers of Borrower with respect to the Property or any part thereof, 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 earnings, revenues,
rents, issues, profits and other income of the Property and every part thereof, and (D) apply the
receipts from the Property or any part thereof to the payment of the Debt, after deducting
therefrom all expenses (including, without limitation, reasonable attorneys’ fees and
disbursements) reasonably incurred in connection with the aforesaid operations and all amounts
necessary to pay the Impositions, insurance and other charges in connection with the Property or
any part thereof, as well as just and reasonable compensation for the services of Lender’s
third-party agents; or (iii) have an appraisal or other valuation of the Property or any part
thereof performed by an Appraiser (and Borrower covenants and agrees it shall cooperate in causing
any such valuation or appraisal to be performed) and any cost or expense incurred by Lender in
connection therewith shall constitute a portion of the Debt and be secured by this Security
Instrument and shall be immediately due and payable to Lender with interest, at the Default Rate,
until the date of receipt by Lender; or (iv) sell the Property or institute proceedings for the
complete foreclosure of this Security Instrument, or take such other action as may be allowed
pursuant to Legal Requirements, at law or in equity, for the enforcement of this Security
Instrument in which case the Property or any part thereof may be sold for cash or credit in one or
more parcels; or (v) with or without entry, and to the extent permitted and pursuant to the
procedures provided by applicable Legal Requirements, institute proceedings for the partial
foreclosure of this Security Instrument, or take such other action as may be allowed pursuant to
Legal Requirements, at law or in equity, for the enforcement of this Security Instrument for the
portion of the Debt then due and payable, subject to the lien of this Security Instrument
continuing unimpaired and without loss of priority so as to secure the balance of the Debt not then
due; or (vi) sell the Property or any part thereof and any or 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, in whole or in parcels, in any order or manner, at such time
and place, upon such terms and after such notice thereof as may be required or permitted by law, at
the discretion of Lender, and in the event of a sale, by foreclosure or otherwise, of less than all
of the Property, this Security Instrument shall continue as a lien on the remaining portion of the
Property; or (vii) institute an action, suit or proceeding in equity for the specific performance
of any covenant, condition or agreement contained in the Loan Documents, or any of them; or (viii)
recover judgment on the Note or any guaranty either before, during or after (or in lieu of) any
proceedings for the enforcement of this Security Instrument; or (ix) apply, ex
parte, for the appointment of a custodian, trustee, receiver, keeper, liquidator or
conservator of the Property or any part thereof, irrespective of the adequacy of the security for
the Debt and without regard to the solvency of Borrower or of any Person liable for the payment of
the Debt, to which appointment Borrower does hereby consent and such receiver or other official
shall have all rights and powers permitted by applicable law and such other rights and powers as
the court making such appointment may confer, but the appointment of such receiver or other
official shall not impair or in any manner prejudice the rights of Lender to receive the Rent with
respect to any of the Property pursuant to this Security Instrument or the Assignment; or (x)
require, at Lender’s option, 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
any portion of the Property occupied by Borrower and may require Borrower to vacate and surrender
possession to Lender of the Property or to such receiver and Borrower may be evicted by summary
proceedings or otherwise; or (xi) without notice to Borrower (A) apply all or any portion of the
cash collateral in any Sub-Account and Escrow Account, including any interest and/or earnings
therein, to carry out the obligations of Borrower under this Security Instrument and the other Loan
Documents, to protect and preserve the Property and for any other purpose permitted under this
Security Instrument and the other Loan Documents and/or (B) have all or any portion of such cash
collateral immediately paid to Lender to be applied against the Debt in the order and priority set
forth in the Note; or (xii) pursue any or all such other rights or remedies as Lender may have
under applicable law or

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in equity; provided, however, that the provisions of this Section 13.02(a) shall not be
construed to extend or modify any of the notice requirements or grace periods provided for
hereunder or under any of the other Loan Documents. Borrower hereby waives, to the fullest extent
permitted by Legal Requirements, any defense Borrower might otherwise raise or have by the failure
to make any tenants parties defendant to a foreclosure proceeding and to foreclose their rights in
any proceeding instituted by Lender.

     (b) Any time after an Event of Default Lender shall have the power to sell the Property or any
part thereof at public auction, in such manner, at such time and place, upon such terms and
conditions, and upon such public notice as Lender may deem best for the interest of Lender, or as
may be required or permitted by applicable law, consisting of advertisement in a newspaper of
general circulation in the jurisdiction and for such period as applicable law may require and at
such other times and by such other methods, if any, as may be required by law to convey the
Property in fee simple by Lender’s deed with special warranty of title to and at the cost of the
purchaser, who shall not be liable to see to the application of the purchase money. The proceeds
or avails of any sale made under or by virtue of this Section 13.02, together with any other sums
which then may be held by Lender under this Security Instrument, whether under the provisions of
this Section 13.02 or otherwise, shall be applied as follows:

First: To the payment of the third-party costs and expenses reasonably incurred in
connection with any such sale and to advances, fees and expenses, including, without
limitation, reasonable fees and expenses of Lender’s legal counsel as applicable, and of any
judicial proceedings wherein the same may be made, and of all expenses, liabilities and
advances reasonably made or incurred by Lender under this Security Instrument, together with
interest as provided herein on all such advances made by Lender, and all Impositions, except
any Impositions or other charges subject to which the Property shall have been sold;

Second: To the payment of the whole amount then due, owing and unpaid under the Note for
principal and interest thereon, with interest on such unpaid principal at the Default Rate
from the date of the occurrence of the earliest Event of Default that formed a basis for
such sale until the same is paid;

Third: To the payment of any other portion of the Debt required to be paid by Borrower
pursuant to any provision of this Security Instrument, the Note, or any of the other Loan
Documents; and

Fourth: The surplus, if any, to Borrower unless otherwise required by Legal Requirements.

Lender and any receiver or custodian of the Property or any part thereof shall be liable to account
for only those rents, issues, proceeds and profits actually received by it.

     (c) Lender may adjourn from time to time any sale by it to be made under or by virtue of this
Security Instrument by announcement at the time and place appointed for such sale or for such
adjourned sale or sales and, except as otherwise provided by any applicable provision of Legal
Requirements, Lender, without further notice or publication, may make such sale at the time and
place to which the same shall be so adjourned.

     (d) Upon the completion of any sale or sales made by Lender under or by virtue of this Section
13.02, Lender, or any officer of any court empowered to do so, shall execute and deliver to the
accepted purchaser or purchasers a good and sufficient instrument, or good and sufficient
instruments, granting, conveying, assigning and transferring all estate, right, title and interest
in and to the property and rights sold. Lender is hereby irrevocably appointed the true and lawful
attorney-in-fact of Borrower (coupled with an interest), in its name and stead, to make all
necessary conveyances, assignments, transfers and deliveries of the property and rights so sold and
for that purpose Lender may execute all necessary instruments of conveyance, assignment, transfer
and delivery, and may substitute one or more Persons with like power, Borrower hereby ratifying and
confirming all that its said attorney-in-fact or such substitute or substitutes shall lawfully do
by virtue hereof. Nevertheless, Borrower, if so requested by Lender, shall ratify and confirm any
such sale or sales by executing and delivering to Lender, or to such purchaser or purchasers all
such instruments as may be advisable, in the sole judgement of Lender, for such purpose, and as may
be designated in such request. Any such sale or sales made under or by virtue of this Section
13.02, whether made under the power of sale herein granted or under or by virtue of judicial
proceedings or a judgment or decree of foreclosure and sale, shall operate to divest all the
estate, right, title, interest, claim and

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demand whatsoever, whether at law or in equity, of Borrower in and to the property and rights
so sold, and shall, to the fullest extent permitted under Legal Requirements, be a perpetual bar,
both at law and in equity against Borrower and against any and all Persons claiming or who may
claim the same, or any part thereof, from, through or under Borrower.

     (e) In the event of any sale made under or by virtue of this Section 13.02 (whether made under
the power of sale herein granted or under or by virtue of judicial proceedings or a judgment or
decree of foreclosure and sale), the entire Debt immediately thereupon shall, anything in the Loan
Documents to the contrary notwithstanding, become due and payable.

     (f) Upon any sale made under or by virtue of this Section 13.02 (whether made under the power
of sale herein granted or under or by virtue of judicial proceedings or a judgment or decree of
foreclosure and sale), Lender may bid for and acquire the Property or any part thereof and in lieu
of paying cash therefor may make settlement for the purchase price by crediting upon the Debt the
net sales price after deducting therefrom the expenses of the sale and the costs of the action.

     (g) No recovery of any judgment by Lender and no levy of an execution under any judgment upon
the Property or any part thereof or upon any other property of Borrower shall release the lien of
this Security Instrument upon the Property or any part thereof, or any liens, rights, powers or
remedies of Lender hereunder, but such liens, rights, powers and remedies of Lender shall continue
unimpaired until all amounts due under the Note, this Security Instrument and the other Loan
Documents are paid in full.

     (h) Upon the exercise by Lender of any power, right, privilege, or remedy pursuant to this
Security Instrument which requires any consent, approval, registration, qualification, or
authorization of any Governmental Authority, Borrower agrees to execute and deliver, or will cause
the execution and delivery of, all applications, certificates, instruments, assignments and other
documents and papers that Lender or any purchaser of the Property may be required to obtain for
such governmental consent, approval, registration, qualification, or authorization and Lender is
hereby irrevocably appointed the true and lawful attorney-in-fact of Borrower (coupled with an
interest), in its name and stead, to execute all such applications, certificates, instruments,
assignments and other documents and papers.

     Section 13.03. Payment of Debt After Default. If, following the occurrence of any
Event of Default, Borrower shall tender payment of an amount sufficient to satisfy the Debt in
whole or in part at any time prior to a foreclosure sale of the Property, and if at the time of
such tender prepayment of the principal balance of the Note is not permitted by the Note or this
Security Instrument, Borrower shall, in addition to the entire Debt, also pay to Lender a sum equal
to (a) all accrued interest on the Note and all other fees, charges and sums due and payable
hereunder, (b) all costs and expenses in connection with the enforcement of Lender’s rights
hereunder, and (c) a prepayment charge (the “Prepayment Charge”) equal to the greater of
(i) 1% of the Principal Amount and (ii) the present value of a series of payments each equal to the
Payment Differential (as hereinafter defined) and payable on each Payment Date over the remaining
original term of the Note and on the Payment Date occurring two months prior to the Maturity Date,
discounted at the Reinvestment Yield (as hereinafter defined) for the number of months remaining as
of the date of such prepayment to each such Payment Date and the Payment Date occurring two months
prior to the Maturity Date. The term “Payment Differential” shall mean an amount equal to (i) the
Interest Rate less the Reinvestment Yield, divided by (ii) twelve (12) and multiplied by (iii) the
Principal Amount after application of the constant monthly payment due under the Note on the date
of such prepayment, provided that the Payment Differential shall in no event be less than zero.
The term “Reinvestment Yield” shall mean an amount equal to the lesser of (i) the yield on the U.S.
Treasury issue (primary issue) with a maturity date closest to the Payment Date occurring two
months prior to the Maturity Date, or (ii) the yield on the U.S. Treasury issue (primary issue)
with a term equal to the remaining average life of the indebtedness evidenced by the Note, with
each such yield being based on the bid price for such issue as published in the Wall Street Journal
on the date that is fourteen (14) days prior to the date of such prepayment set forth in the notice
of prepayment (or, if such bid price is not published on that date, the next preceding date on
which such bid price is so published) and converted to a monthly compounded nominal yield. In
addition to the amounts described above, if, during the first (1st) Loan Year, Borrower shall
tender payment of an amount sufficient to satisfy the Debt in whole or in part following the

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occurrence of any Event of Default, Borrower shall, in addition to the entire Debt, also pay
to Lender a sum equal to three percent (3%) of the Principal Amount. Failure of Lender to require
any of these payments shall not constitute a waiver of the right to require the same in the event
of any subsequent default or to exercise any other remedy available to Lender hereunder, under any
other Loan Document or at law or in equity. In the event that any prepayment charge is due
hereunder, Lender shall deliver to Borrower a statement setting forth the amount and determination
of the prepayment fee, and, provided that Lender shall have in good faith applied the formula
described above, Borrower shall not have the right to challenge the calculation or the method of
calculation set forth in any such statement in the absence of manifest error, which calculation may
be made by Lender on any day during the fifteen (15) day period preceding the date of such
prepayment. Lender shall not be obligated or required to have actually reinvested the prepaid
principal balance at the Reinvestment Yield or otherwise as a condition to receiving the prepayment
charge. If at the time of such tender, prepayment of the principal balance of the Note is
permitted, such tender by Borrower shall be deemed to be a voluntary prepayment of the principal
balance of the Note, and Borrower shall, in addition to the entire Debt, also pay to Lender the
applicable prepayment consideration specified in the Note and this Security Instrument.

     Section 13.04. Possession of the Property. Upon the occurrence of any Event of
Default and the acceleration of the Debt or any portion thereof, Borrower, if an occupant of the
Property or any part thereof, upon demand of Lender, shall immediately surrender possession of the
Property (or the portion thereof so occupied) to Lender, and if Borrower is permitted to remain in
possession, the possession shall be as a month-to-month tenant of Lender and, on demand, Borrower
shall pay to Lender monthly, in advance, a reasonable rental for the space so occupied and in
default thereof Borrower may be dispossessed. The covenants herein contained may be enforced by a
receiver of the Property or any part thereof. Nothing in this Section 13.04 shall be deemed to be
a waiver of the provisions of this Security Instrument making the Transfer of the Property or any
part thereof without Lender’s prior written consent an Event of Default.

     Section 13.05. Interest After Default. If any amount due under the Note, this
Security Instrument or any of the other Loan Documents is not paid within any applicable notice and
grace period after same is due, whether such date is the stated due date, any accelerated due date
or any other date or at any other time specified under any of the terms hereof or thereof, then, in
such event, Borrower shall pay interest on the amount not so paid from and after the date on which
such amount first becomes due at the Default Rate; and such interest shall be due and payable at
such rate until the earlier of the cure of all Events of Default or the payment of the entire
amount due to Lender, whether or not any action shall have been taken or proceeding commenced to
recover the same or to foreclose this Security Instrument. All unpaid and accrued interest shall
be secured by this Security Instrument as part of the Debt. Nothing in this Section 13.05 or in
any other provision of this Security Instrument shall constitute an extension of the time for
payment of the Debt.

     Section 13.06. Borrower’s Actions After Default. After the happening of any Event of
Default and immediately upon the commencement of any action, suit or other legal proceedings by
Lender to obtain judgment for the Debt, or of any other nature in aid of the enforcement of the
Loan Documents, Borrower will (a) after receipt of notice of the institution of any such action,
waive the issuance and service of process and enter its voluntary appearance in such action, suit
or proceeding, and (b) if required by Lender, consent to the appointment of a receiver or receivers
of the Property or any part thereof and of all the earnings, revenues, rents, issues, profits and
income thereof.

     Section 13.07. Control by Lender After Default. Notwithstanding the appointment of
any custodian, receiver, liquidator or trustee of Borrower, or of any of its property, or of the
Property or any part thereof, to the extent permitted by Legal Requirements, Lender shall be
entitled to obtain possession and control of all property now and hereafter covered by this
Security Instrument and the Assignment in accordance with the terms hereof.

     Section 13.08. Right to Cure Defaults. (a) Upon the occurrence of any Event of
Default, Lender or its agents 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 and its agents are authorized to enter upon the Property or any part thereof for such
purposes, or appear in, defend, or bring any action or proceedings to protect Lender’s interest in

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the Property or any part thereof or to foreclose this Security Instrument 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 13.08, shall constitute a portion of the Debt and
shall be immediately due and payable to Lender upon demand. All such costs and expenses incurred
by Lender or its agents in remedying such Event of Default or in appearing in, defending, or
bringing any such action or proceeding shall bear interest at the Default Rate, for the period from
the date so demanded to the date of payment to Lender. All such costs and expenses incurred by
Lender or its agents together with interest thereon calculated at the above rate shall be deemed to
constitute a portion of the Debt and be secured by this Security Instrument.

     (b) If Lender makes any payment or advance that Lender is authorized by this Security
Instrument to make in the place and stead of Borrower (i) relating to the Impositions or tax liens
asserted against the Property, Lender may do so according to any bill, statement or estimate
procured from the appropriate public office without inquiry into the accuracy of the bill,
statement or estimate or into the validity of any of the Impositions or the tax liens or claims
thereof; (ii) relating to any apparent or threatened adverse title, lien, claim of lien,
encumbrance, claim or charge, Lender will be the sole judge of the legality or validity of same; or
(iii) relating to any other purpose authorized by this Security Instrument but not enumerated in
this Section 13.08, Lender may do so whenever, in its judgment and discretion, the payment or
advance seems necessary or desirable to protect the Property and the full security interest
intended to be created by this Security Instrument. In connection with any payment or advance made
pursuant to this Section 13.08, Lender has the option and is authorized, but in no event shall be
obligated, to obtain a continuation report of title prepared by a title insurance company. The
payments and the advances made by Lender pursuant to this Section 13.08 and the cost and expenses
of said title report will be due and payable by Borrower on demand, together with interest at the
Default Rate, and will be secured by this Security Instrument.

     Section 13.09. Late Payment Charge. If any portion of the Debt (other than the
principal portion of the Debt due on Maturity) is not paid in full on or before the day on which it
is due and payable hereunder, Borrower shall pay to Lender an amount equal to five percent (5%) of
such unpaid portion of the Debt (“Late Charge”) to defray the expense incurred by Lender in
handling and processing such delinquent payment, and such amount shall constitute a part of the
Debt.

     Section 13.10. 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 and payable hereunder (after the expiration of any grace period or the giving of
any notice herein provided, if any), 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 13.11. Marshalling and Other Matters. Borrower hereby waives, to the fullest
extent permitted by law, the benefit of all appraisement, valuation, stay, extension,
reinstatement, redemption (both equitable and statutory) and homestead 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. Nothing herein or in any other Loan Document shall be construed
as requiring Lender to resort to any particular Cross-collateralized Property for the satisfaction
of the Debt in preference or priority to any other Cross-collateralized Property but Lender may
seek satisfaction out of all the Cross-collateralized Properties or any part thereof in its
absolute discretion. Further, Borrower hereby expressly waives any and all rights of redemption
from sale under any order or decree of foreclosure of this Security Instrument on behalf of
Borrower, whether equitable or statutory and on behalf of each and every Person acquiring any
interest in or title to the Property or any part thereof subsequent to the date of this Security
Instrument and on behalf of all Persons to the fullest extent permitted by applicable law.

     Section 13.12. Tax Reduction Proceedings. After an Event of Default, Borrower shall
be deemed to have appointed Lender as its attorney-in-fact to seek a reduction or reductions in the
assessed valuation of the Property for real property tax purposes or for any other purpose and to
prosecute any action or proceeding in connection therewith. This power, being coupled with an
interest, shall be irrevocable for so long as any part of the Debt remains unpaid and any Event of
Default shall be continuing.

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     Section 13.13. General Provisions Regarding Remedies.

     (a) Right to Terminate Proceedings. Lender may terminate or rescind any proceeding or
other action brought in connection with its exercise of the remedies provided in Section 13.02 at
any time before the conclusion thereof, as determined in Lender’s sole discretion and without
prejudice to Lender.

     (b) No Waiver or Release. The failure of Lender to exercise any right, remedy or
option provided in the Loan Documents shall not be deemed a waiver of such right, remedy or option
or of any covenant or obligation contained in the Loan Documents. No acceptance by Lender of any
payment after the occurrence of an Event of Default and no payment by Lender of any payment or
obligation for which Borrower is liable hereunder shall be deemed to waive or cure any Event of
Default. No sale of all or any portion of the Property, no forbearance on the part of Lender, and
no extension of time for the payment of the whole or any portion of the Debt or any other
indulgence given by Lender to Borrower or any other Person, shall operate to release or in any
manner affect the interest of Lender in the Property or the liability of Borrower to pay the Debt.
No waiver by Lender shall be effective unless it is in writing and then only to the extent
specifically stated.

     (c) No Impairment; No Releases. The interests and rights of Lender under the Loan
Documents shall not be impaired by any indulgence, including (i) any renewal, extension or
modification which Lender may grant with respect to any of the Debt; (ii) any surrender,
compromise, release, renewal, extension, exchange or substitution which Lender may grant with
respect to the Property or any portion thereof; or (iii) any release or indulgence granted to any
maker, endorser, guarantor or surety of any of the Debt.

     (d) Effect on Judgment. No recovery of any judgment by Lender and no levy of an
execution under any judgment upon any Property or any portion thereof shall affect in any manner or
to any extent the lien of the other Cross-collateralized Mortgages upon the remaining
Cross-collateralized Properties or any portion thereof, or any rights, powers or remedies of Lender
hereunder or thereunder. Such lien, rights, powers and remedies of Lender shall continue unimpaired
as before.

ARTICLE XIV:  COMPLIANCE WITH REQUIREMENTS

     Section 14.01. Compliance with Legal Requirements. (a) Borrower shall promptly comply
with all present and future Legal Requirements, foreseen and unforeseen, ordinary and
extraordinary, whether requiring structural or nonstructural repairs or alterations including,
without limitation, all zoning, subdivision, building, safety and environmental protection, land
use and development Legal Requirements, all Legal Requirements which may be applicable to the curbs
adjoining the Property or to the use or manner of use thereof, and all rent control, rent
stabilization and all other similar Legal Requirements relating to rents charged and/or collected
in connection with the Leases. Borrower represents and warrants that the Property is in compliance
in all respects with all Legal Requirements as of the date hereof, no notes or notices of
violations of any Legal Requirements have been entered or received by Borrower and there is no
basis for the entering of such notes or notices.

     (b) Borrower shall have the right to contest by appropriate legal proceedings diligently
conducted in good faith, without cost or expense to Lender, the validity or application of any
Legal Requirement and to suspend compliance therewith if permitted under applicable Legal
Requirements, provided (i) failure to comply therewith may not subject Lender to any civil or
criminal liability, (ii) prior to and during such contest, Borrower shall furnish to Lender
security reasonably satisfactory to Lender, in its reasonable discretion, against loss or injury by
reason of such contest or non-compliance with such Legal Requirement, (iii) no Event of Default
shall exist during such proceedings and such contest shall not otherwise violate any of the
provisions of any of the Loan Documents, (iv) such contest shall not (unless Borrower shall comply
with the provisions of clause (ii) of this Section 14.01(b)) subject the Property to any lien or
encumbrance the enforcement of which is not suspended or otherwise affect the priority of the lien
of this Security Instrument; (v) such contest shall not affect the ownership, use or occupancy of
the Property; (vi) the Property or any part thereof or any interest therein shall not be in any
immediate danger of being sold, forfeited or lost by reason of such contest by Borrower; (vii)
Borrower shall give Lender prompt notice of the commencement of such proceedings and, upon request
by Lender, notice of the status of such proceedings and/or confirmation of the continuing
satisfaction of the conditions set forth in clauses (i) — (vi) of this Section

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14.01(b); and (viii) upon a final determination of such proceeding, Borrower shall take all
steps necessary to comply with any requirements arising therefrom.

     (c) Borrower shall at all times comply with all applicable Legal Requirements with respect to
the construction, use and maintenance of any vaults adjacent to the Property. If by reason of the
failure to pay taxes, assessments, charges, permit fees, franchise taxes or levies of any kind or
nature, the continued use of the vaults adjacent to Property or any part thereof is discontinued,
Borrower nevertheless shall, with respect to any vaults which may be necessary for the continued
use of the Property, take such steps (including the making of any payment) to ensure the continued
use of vaults or replacements.

     Section 14.02. Compliance with Recorded Documents; No Future Grants. Borrower shall
promptly perform and observe or cause to be performed and observed, all of the terms, covenants and
conditions of all Property Agreements and all things necessary to preserve intact and unimpaired
any and all appurtenances or other interests or rights affecting the Property.

ARTICLE XV:  DEFEASANCE; PREPAYMENT

     Section 15.01. Defeasance; Prepayment. (a) Except as set forth in this Section 15.01,
no prepayment or defeasance of the Debt may be made by or on behalf of Borrower in whole or in
part.

     (b) Borrower may defease the Loan at any time subsequent to the earlier to occur of (x) the
second (2nd) anniversary of a Securitization or (y) the third (3rd) anniversary of the date hereof
and prior to the calendar month immediately preceding the Maturity Date, in whole or, from time to
time, in part, as of the last day of an Interest Accrual Period, it being acknowledged that
Borrower may defease the Loan on a day other than the last day of an Interest Accrual Period,
provided that Borrower pays all interest which would otherwise be due to Lender through the end of
such Interest Accrual Period, in accordance with the following provisions:

     (i) Lender shall have received from Borrower, not less than thirty (30) days’, nor more
than ninety (90) days’, prior written notice specifying the date proposed for such
defeasance and the amount which is to be defeased, which proposed date shall be as of a
Payment Date (which notice shall be revocable by Borrower three (3) times during the term of
the Loan by giving Lender not less than two (2) Business Days prior written notice of such
revocation, provided that Borrower shall remain obligated to pay Lender’s costs and expenses
including, without limitation, breakage costs incurred by Lender in connection with such
revocation).

     (ii) Borrower shall also pay to Lender all interest due through and including the last
day of the Interest Accrual Period ending on the day prior to the Payment Date in which such
defeasance is being made, together with any and all other amounts due and owing pursuant to
the terms of the Note, this Security Instrument or the other Loan Documents, including,
without limitation, any costs incurred in connection with a defeasance.

     (iii) No Event of Default shall have occurred and be continuing.

     (iv) Borrower shall (A) either pay the Defeasance Deposit, or if Borrower shall elect,
purchase the Federal Obligations and (B) deliver to Lender (1) a security agreement, in form
and substance reasonably satisfactory to Lender, creating a first priority lien on the
Defeasance Deposit (if applicable) and the Federal Obligations purchased by or on behalf of
Borrower in accordance with the terms of this Section 15.01(b)(iv) (the “Security
Agreement”); (2) an Officer’s Certificate certifying that the requirements set forth in
this Section 15.01(b)(iv) have been satisfied; (3) an opinion of counsel for Borrower in
form and substance reasonably satisfactory to Lender stating, among other things, that (x)
Lender has a perfected security interest in the Defeasance Deposit (if applicable) and a
first priority perfected security interest in the Federal Obligations purchased by Lender on
behalf of Borrower or by Borrower, as applicable, (y) the contemplated defeasance will not
result in any deemed exchange pursuant to Section 1001 of the Code of

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the Note and will not adversely affect the Note’s or, if applicable, the undefeased
Note’s status as indebtedness for Federal income tax purposes and (z) any trust formed as a
“real estate mortgage investment conduit” within the meaning of Section 860D of the Code
(“REMIC”) in connection with a Securitization will not fail to maintain its status
as a REMIC as a result of such defeasance; (4) in the event that only a portion of the Loan
is being defeased, Borrower shall execute and deliver all necessary documents to split the
Note into two substitute notes, one having a principal balance equal to the defeased portion
of the Note (the “Defeased Note”) and one note having a principal balance equal to
the undefeased portion of the Note (the “Undefeased Note”), the amortization
schedule for which notes shall be calculated, in the case of a Defeased Note, or
recalculated, in the case of an Undefeased Note, to amortize the respective principal
balances of each on the same schedule as the Note (including, without limitation, the
payment of the Principal Amount due on the Maturity Date); (5) a certificate, in form and
substance reasonably satisfactory to Lender from a nationally recognized Independent
certified public accountant confirming that the requirements of this Section 15.01(b) have
been satisfied; and (6) such other certificates, documents, opinions or instruments as
Lender may reasonably request. Borrower reserves the right to purchase Federal Obligations
with and in lieu of making the Defeasance Deposit which provide Scheduled Defeasance
Payments, and, if Borrower shall deliver the Defeasance Deposit to Lender, appoints Lender
as its agent and attorney-in-fact, coupled with an interest (which appointment will not be
exercised if Borrower notifies Lender in writing in the notice provided for in Section
15.01(b)(i) that Borrower will purchase the Federal Obligations), for the purpose of using
the Defeasance Deposit to purchase Federal Obligations which provide Scheduled Defeasance
Payments, and Lender shall, upon receipt of the Defeasance Deposit, purchase such Federal
Obligations on behalf of Borrower. Borrower, pursuant to the Security Agreement or other
appropriate document, shall authorize and direct that the payments received from the Federal
Obligations shall be made directly to Lender and applied to satisfy the obligations of
Borrower under the Defeased Note. The Defeased Note and the Undefeased Note shall have
identical terms as the Note, except for the principal balance. A Defeased Note cannot be
the subject of a further defeasance.

     (v) The Rating Agencies shall have confirmed in writing that any rating issued by the
Rating Agencies in connection with the Securitization will not, as a result of the proposed
defeasance, be downgraded, from the then current ratings thereof, qualified or withdrawn.

     (vi) If the Loan is to be defeased and Borrower is requesting a release of the Property
in connection with such defeasance, such defeasance shall be to facilitate the disposition
or refinancing of the Property or in connection with any other customary transaction within
the meaning of Treas. Reg. 1.860G-(2)(a)(8)(iii).

     (vii) If Borrower shall continue to own any assets other than the Defeasance Deposit,
Borrower shall establish or designate a special-purpose bankruptcy-remote successor entity
reasonably acceptable to Lender (the “Successor Borrower”), with respect to which a
substantive nonconsolidation opinion satisfactory in form and substance reasonably
satisfactory to Lender has been delivered to Lender and Borrower shall transfer and assign
to the Successor Borrower all obligations, rights and duties under the Note and the Security
Agreement, together with the pledged Defeasance Deposit. The Successor Borrower shall
assume the obligations of Borrower under the Note and the Security Agreement and Borrower
shall be relieved of its obligations hereunder and thereunder. Borrower shall pay Ten and
No/100 Dollars ($10.00) to the Successor Borrower as consideration for assuming such
Borrower obligations.

     (viii) In the event the Loan is defeased in full in accordance with the terms hereof,
Lender shall release all reserves, escrows and guaranties relating to the Loan to Borrower
and in the event the Loan is defeased in part in connection with a Release in accordance
with the terms hereof, Lender shall release to Borrower all reserves and escrows relating to
the Property subject to the Release.

     (c) At any time subsequent to the Payment Date occurring in February, 2017 (the “Lockout
Expiration Date”), Borrower may prepay the Loan, in whole, but not in part, as of the last day
of an Interest Accrual

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Period, it being acknowledged that Borrower may prepay the Loan on a day other than the last
day of an Interest Accrual Period, provided that Borrower pays all interest which would otherwise
be due to Lender through the end of such Interest Accrual Period, in accordance with the following
provisions:

     (i) Lender shall have received from Borrower not less than thirty (30) days , nor more
than ninety (90) days, prior written notice specifying the date proposed for such prepayment
and the amount which is to be prepaid (which notice shall be revocable by Borrower up to two
(2) times during the term of the Loan by giving Lender not less than one (1) Business Day
prior written notice of such revocation, provided that Borrower shall remain obligated to
pay Lender’s costs and expenses including, without limitation, breakage costs incurred by
Lender in connection with such revocation).

     (ii) Borrower shall also pay to Lender all interest due through and including the last
day of the Interest Accrual Period in which such prepayment is being made, together with any
and all other amounts due and owing pursuant to the terms of the Note, this Security
Instrument or the other Loan Documents.

     (iii) Any partial prepayment shall be in a minimum amount not less than $25,000 and
shall be in whole multiples of $1,000 in excess thereof.

     (iv) No Event of Default shall have occurred and be continuing.

     (v) Any partial prepayment of the Principal Amount, including, without limitation,
Unscheduled Payments, shall be applied to the installments of principal last due hereunder
and shall not release or relieve Borrower from the obligation to pay the regularly scheduled
installments of principal and interest becoming due under the Note.

     Section 15.02. Release of Property. If Borrower prepays or defeases all or a portion
of the Loan pursuant to Section 15.01 hereof or if Lender applies Loss Proceeds from the Property
towards the repayment of the Debt or towards a defeasance, Lender shall, promptly upon satisfaction
of all the following terms and conditions execute, acknowledge and deliver to Borrower a release of
this Security Instrument (a “Release”) in recordable form with respect to the Property:

     (a) If such prepayment or defeasance, as applicable, is a prepayment or defeasance, as
applicable, in part, but not in whole, Lender shall have received on the date proposed for such
prepayment or defeasance, as applicable, an amount equal to the greater of (i) the amount which is
necessary to defease a portion of the Loan Amount equal to the Release Price Percentage multiplied
by the Allocated Loan Amount with respect to the Cross-collateralized Property which is the subject
of the Release, (ii) such amount as would cause the Debt Yield subsequent to the contemplated
Release to be equal to or greater than the Debt Yield prior to the contemplated Release and (iii)
such amount as would cause the Debt Yield subsequent to the contemplated Release to be no less than
the Debt Yield as of the Closing Date (the “Release Price”).

     (b) Borrower shall, at its sole expense, prepare any and all documents and instruments
necessary to effect the Release, all of which shall be subject to the reasonable approval of
Lender, and Borrower shall pay all costs reasonably incurred by Lender (including, but not limited
to, reasonable attorneys’ fees and disbursements, title search costs or endorsement premiums) in
connection with the review, execution and delivery of the Release.

     (c) No Event of Default has occurred and is continuing.

ARTICLE XVI:  ENVIRONMENTAL COMPLIANCE

     Section 16.01. Covenants, Representations and Warranties. (a) Borrower has not, at
any time, and, to Borrower’s best knowledge after due inquiry and investigation, except as set
forth in the Environmental Report, no other Person has at any time, handled, buried, stored,
retained, refined, transported, processed, manufactured,

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generated, produced, spilled, allowed to seep, leak, escape or leach, or pumped, poured,
emitted, emptied, discharged, injected, dumped, transferred or otherwise disposed of or dealt with
Hazardous Materials on, to or from the Premises or any other real property owned and/or occupied by
Borrower, and Borrower does not intend to and shall not use the Property or any part thereof or any
such other real property for the purpose of handling, burying, storing, retaining, refining,
transporting, processing, manufacturing, generating, producing, spilling, seeping, leaking,
escaping, leaching, pumping, pouring, emitting, emptying, discharging, injecting, dumping,
transferring or otherwise disposing of or dealing with Hazardous Materials, except for use and
storage for use of heating oil, cleaning fluids, pesticides and other substances customarily used
in the operation of properties that are being used for the same purposes as the Property is
presently being used, provided such use and/or storage for use is in compliance with the
requirements hereof and the other Loan Documents and does not give rise to liability under
applicable Legal Requirements or Environmental Statutes or be the basis for a lien against the
Property or any part thereof. In addition, without limitation to the foregoing provisions,
Borrower represents and warrants that, to the best of its knowledge, after due inquiry and
investigation, except as previously disclosed in writing to Lender or in the Environmental Report,
there is no asbestos in, on, over, or under all or any portion of the fire-proofing or any other
portion of the Property.

     (b) Borrower, after due inquiry and investigation, knows of no seepage, leak, escape, leach,
discharge, injection, release, emission, spill, pumping, pouring, emptying or dumping of Hazardous
Materials into waters on, under or adjacent to the Property or any part thereof or any other real
property owned and/or occupied by Borrower, or onto lands from which such Hazardous Materials might
seep, flow or drain into such waters, except as disclosed in the Environmental Report or as
permitted by applicable Legal Requirements.

     (c) Borrower shall not permit any Hazardous Materials to be handled, buried, stored, retained,
refined, transported, processed, manufactured, generated, produced, spilled, allowed to seep, leak,
escape or leach, or to be pumped, poured, emitted, emptied, discharged, injected, dumped,
transferred or otherwise disposed of or dealt with on, under, to or from the Property or any
portion thereof at any time, except for use and storage for use of heating oil, ordinary cleaning
fluids, pesticides and other substances customarily used in the operation of properties that are
being used for the same purposes as the Property is presently being used, provided such use and/or
storage for use is in compliance with the requirements hereof and the other Loan Documents and does
not give rise to liability under applicable Legal Requirements or be the basis for a lien against
the Property or any part thereof.

     (d) Borrower represents and warrants that no actions, suits, or proceedings have been
commenced, or are pending, or to the best knowledge of Borrower, are threatened with respect to any
Legal Requirement governing the use, manufacture, storage, treatment, transportation, or processing
of Hazardous Materials with respect to the Property or any part thereof. Borrower has received no
notice of, and, except as disclosed in the Environmental Report, after due inquiry, has no
knowledge of any fact, condition, occurrence or circumstance which with notice or passage of time
or both would give rise to a claim under or pursuant to any Environmental Statute pertaining to
Hazardous Materials on, in, under or originating from the Property or any part thereof or any other
real property owned or occupied by Borrower or arising out of the conduct of Borrower, including,
without limitation, pursuant to any Environmental Statute.

     (e) Borrower has not waived any Person’s liability with regard to Hazardous Materials in, on,
under or around the Property, nor has Borrower retained or assumed, contractually or by operation
of law, any other Person’s liability relative to Hazardous Materials or any claim, action or
proceeding relating thereto.

     (f) In the event that there shall be filed a lien against the Property or any part thereof
pursuant to any Environmental Statute pertaining to Hazardous Materials, Borrower shall, within
sixty (60) days or, in the event that the applicable Governmental Authority has commenced steps to
cause the Premises or any part thereof to be sold pursuant to the lien, within fifteen (15) days,
from the date that Borrower receives notice of such lien, either (i) pay the claim and remove the
lien from the Property, or (ii) furnish (A) a bond reasonably satisfactory to Lender in the amount
of the claim out of which the lien arises, (B) a cash deposit in the amount of the claim out of
which the lien arises, or (C) other security reasonably satisfactory to Lender in an amount
sufficient to discharge the claim out of which the lien arises.

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     (g) Borrower represents and warrants that (i) except as disclosed in the Environmental Report,
Borrower has no knowledge of any violation of any Environmental Statute or any Environmental
Problem in connection with the Property, nor has Borrower been requested or required by any
Governmental Authority to perform any remedial activity or other responsive action in connection
with any Environmental Problem and (ii) to Borrower’s knowledge and except as disclosed in the
Environmental Report neither the Property nor any other property owned by Borrower is included or,
to Borrower’s best knowledge, after due inquiry and investigation, proposed for inclusion on the
National Priorities List issued pursuant to CERCLA by the United States Environmental Protection
Agency (the “EPA”) or on the inventory of other potential “Problem” sites issued by the EPA
or has been identified by the EPA as a potential CERCLA site or included or, to Borrower’s
knowledge, after due inquiry and investigation, proposed for inclusion on any list or inventory
issued pursuant to any other Environmental Statute, if any, or issued by any other Governmental
Authority. Borrower covenants that Borrower will comply with all Environmental Statutes affecting
or imposed upon Borrower or the Property.

     (h) Borrower covenants that it shall promptly notify Lender of the presence and/or release of
any Hazardous Materials in amounts which are required by applicable Legal Requirements to be
reported to and Governmental Authority and of any request for information or any inspection of the
Property or any part thereof by any Governmental Authority with respect to any Hazardous Materials
and provide Lender with copies of such request and any response to any such request or inspection.
Borrower covenants that it shall, in compliance with applicable Legal Requirements, conduct and
complete all investigations, studies, sampling and testing (and promptly shall provide Lender with
copies of any such studies and the results of any such test) and all remedial, removal and other
actions necessary to clean up and remove all Hazardous Materials in, on, over, under, from or
affecting the Property or any part thereof in accordance with all such Legal Requirements
applicable to the Property or any part thereof to the satisfaction of Lender.

     (i) Following the occurrence of an Event of Default hereunder, and without regard to whether
Lender shall have taken possession of the Property or a receiver has been requested or appointed or
any other right or remedy of Lender has or may be exercised hereunder or under any other Loan
Document, Lender shall have the right (but no obligation) to conduct such investigations, studies,
sampling and/or testing of the Property or any part thereof as Lender may, in its discretion,
determine to conduct, relative to Hazardous Materials. All costs and expenses incurred in
connection therewith including, without limitation, consultants’ fees and disbursements and
laboratory fees, shall constitute a part of the Debt and shall, upon demand by Lender, be
immediately due and payable and shall bear interest at the Default Rate from the date so demanded
by Lender until reimbursed. Borrower shall, at its sole cost and expense, fully and expeditiously
cooperate in all such investigations, studies, samplings and/or testings including, without
limitation, providing all relevant information and making knowledgeable people available for
interviews.

     (j) Borrower represents and warrants that except in accordance with all applicable
Environmental Statutes and as disclosed in the Environmental Report, (i) no underground treatment
or storage tanks or pumps or water, gas, or oil wells are or, to Borrower’s knowledge, have been
located about the Property, (ii) no PCBs or transformers, capacitors, ballasts or other equipment
that contain dielectric fluid containing PCBs are located about the Property, (iii) no insulating
material containing urea formaldehyde is located about the Property and (iv) no asbestos-containing
material is located about the Property.

     Section 16.02. Environmental Indemnification. Borrower shall defend, indemnify and
hold harmless the Indemnified Parties for, from and against any claims, demands, penalties, fines,
liabilities, settlements, damages, costs and expenses of whatever kind or nature, known or unknown,
contingent or otherwise, whether incurred or imposed within or outside the judicial process,
including, without limitation, reasonable attorneys’ and consultants’ fees and disbursements and
investigations and laboratory fees arising out of, or in any way related to any Environmental
Problem, including without limitation:

     (a) the presence, disposal, escape, seepage, leakage, spillage, discharge, emission, release
or threat of release of any Hazardous Materials in, on, over, under, from or affecting the Property
or any part thereof whether or not disclosed by the Environmental Report;

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     (b) any personal injury (including wrongful death, disease or other health condition related
to or caused by, in whole or in part, any Hazardous Materials) or property damage (real or
personal) arising out of or related to any Hazardous Materials in, on, over, under, from or
affecting the Property or any part thereof whether or not disclosed by the Environmental Report;

     (c) any action, suit or proceeding brought or threatened, settlement reached, or order of any
Governmental Authority relating to such Hazardous Material whether or not disclosed by the
Environmental Report; and/or

     (d) any violation of the provisions, covenants, representations or warranties of Section 16.01
hereof or of any Legal Requirement which is based on or in any way related to any Hazardous
Materials in, on, over, under, from or affecting the Property or any part thereof including,
without limitation, the cost of any work performed and materials furnished in order to comply
therewith whether or not disclosed by the Environmental Report.

     Notwithstanding the foregoing provisions of this Section 16.02 to the contrary, Borrower shall
have no obligation to indemnify Lender for liabilities, claims, damages, penalties, causes of
action, costs and expenses relative to the foregoing which result directly from (A) Lender’s
willful misconduct or gross negligence, or (B) Hazardous Materials initially placed in, on or under
the Property after Lender takes title to the Property after foreclosure or delivery of a deed in
lieu thereof. Any amounts payable to Lender by reason of the application of this Section 16.02
shall be secured by this Security Instrument and shall, upon demand by Lender, become immediately
due and payable and shall bear interest at the Default Rate from the date so demanded by Lender
until paid.

     This indemnification shall survive the termination of this Security Instrument whether by
repayment of the Debt, foreclosure or deed in lieu thereof, assignment, or otherwise. The
indemnity provided for in this Section 16.02 shall not be included in any exculpation of Borrower
from personal liability provided for in this Security Instrument or in any of the other Loan
Documents. Nothing in this Section 16.02 shall be deemed to deprive Lender of any rights or
remedies otherwise available to Lender, including, without limitation, those rights and remedies
provided elsewhere in this Security Instrument or the other Loan Documents.

ARTICLE XVII:  ASSIGNMENTS

     Section 17.01. Participations and Assignments. Lender shall have the right to assign
this Security Instrument and/or any of the Loan Documents, and to transfer, assign or sell
participations and subparticipations (including blind or undisclosed participations and
subparticipations) in the Loan Documents and the obligations hereunder to any Person; provided,
however, that no such participation shall increase, decrease or otherwise affect either Borrower’s
or Lender’s obligations under this Security Instrument or the other Loan Documents.

ARTICLE XVIII:  MISCELLANEOUS

     Section 18.01. Right of Entry. Lender and its agents shall have the right to enter
and inspect the Property or any part thereof at all reasonable times, and, except in the event of
an emergency, upon reasonable notice and to inspect Borrower’s books and records and to make
abstracts and reproductions thereof.

     Section 18.02. Cumulative Rights. The rights of Lender under this Security Instrument
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, subject to the terms of this Security
Instrument, to every right and remedy now or hereafter afforded by law.

     Section 18.03. Liability. If Borrower consists of more than one Person, the
obligations and liabilities of each such Person hereunder shall be joint and several.

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     Section 18.04. Exhibits Incorporated. The information set forth on the cover hereof,
and the Exhibits annexed hereto, are hereby incorporated herein as a part of this Security
Instrument with the same effect as if set forth in the body hereof.

     Section 18.05. Severable Provisions. If any term, covenant or condition of the Loan
Documents including, without limitation, the Note or this Security Instrument, is held to be
invalid, illegal or unenforceable in any respect, such Loan Document shall be construed without
such provision.

     Section 18.06. Duplicate Originals. This Security Instrument may be executed in any
number of duplicate originals and each such duplicate original shall be deemed to constitute but
one and the same instrument.

     Section 18.07. No Oral Change. The terms of this Security Instrument, together with
the terms of the Note and the other Loan Documents, constitute the entire understanding and
agreement of the parties hereto and supersede all prior agreements, understandings and negotiations
between Borrower and Lender with respect to the Loan. This Security Instrument, and any provisions
hereof, may not be modified, amended, waived, extended, changed, discharged or terminated orally or
by any 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 18.08. Waiver of Counterclaim, Etc. BORROWER HEREBY WAIVES THE RIGHT TO
ASSERT A COUNTERCLAIM, OTHER THAN A COMPULSORY COUNTERCLAIM, IN ANY ACTION OR PROCEEDING BROUGHT
AGAINST IT BY LENDER OR ITS AGENTS, AND WAIVES TRIAL BY JURY IN ANY ACTION OR PROCEEDING BROUGHT BY
EITHER PARTY HERETO AGAINST THE OTHER OR IN ANY COUNTERCLAIM BORROWER MAY BE PERMITTED TO ASSERT
HEREUNDER OR WHICH MAY BE ASSERTED BY LENDER OR ITS AGENTS, AGAINST BORROWER, OR IN ANY MATTERS
WHATSOEVER ARISING OUT OF OR IN ANY WAY CONNECTED WITH THIS SECURITY INSTRUMENT OR THE DEBT.

     Section 18.09. Headings; Construction of Documents; etc. The table of contents,
headings and captions of various paragraphs of this Security Instrument 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. Borrower acknowledges that it was represented by competent counsel in
connection with the negotiation and drafting of this Security Instrument and the other Loan
Documents and that neither this Security Instrument nor the other Loan Documents shall be subject
to the principle of construing the meaning against the Person who drafted same.

     Section 18.10. Sole Discretion of Lender. Whenever Lender exercises any right given
to it to approve or disapprove, or any arrangement or term is to be satisfactory to Lender, the
decision of Lender to approve or disapprove or to decide that arrangements or terms are
satisfactory or not satisfactory shall be in the sole discretion of Lender and shall be final and
conclusive, except as may be otherwise specifically provided herein.

     Section 18.11. Waiver of Notice. Borrower shall not be entitled to any notices of any
nature whatsoever from Lender except with respect to matters for which the Loan Documents
specifically and expressly provide for the giving of notice by Lender to Borrower and except with
respect to matters for which Borrower is not, pursuant to applicable Legal Requirements, permitted
to waive the giving of notice.

     Section 18.12. Covenants Run with the Land. All of the grants, covenants, terms,
provisions and conditions herein shall run with the Premises, shall be binding upon Borrower and
shall inure to the benefit of Lender, subsequent holders of this Security Instrument and their
successors and assigns. Without limitation to any provision hereof, the term “Borrower” shall
include and refer to the borrower named herein, any subsequent owner of the Property, and its
respective heirs, executors, legal representatives, successors and assigns. The representations,
warranties and agreements contained in this Security Instrument and the other Loan Documents are
intended solely for the benefit of the parties hereto, shall confer no rights hereunder, whether
legal or equitable, in any other Person and no other Person shall be entitled to rely thereon.

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     Section 18.13. Applicable Law. THIS SECURITY INSTRUMENT WAS NEGOTIATED IN NEW YORK,
AND MADE BY BORROWER AND ACCEPTED BY LENDER IN THE STATE OF NEW YORK, AND THE PROCEEDS OF THE NOTE
WERE DISBURSED FROM NEW YORK, WHICH STATE THE PARTIES AGREE HAS A SUBSTANTIAL RELATIONSHIP TO THE
PARTIES AND TO THE UNDERLYING TRANSACTION EMBODIED HEREBY, AND IN ALL RESPECTS, INCLUDING, WITHOUT
LIMITING THE GENERALITY OF THE FOREGOING, MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE. THIS
SECURITY INSTRUMENT AND THE OBLIGATIONS ARISING HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND PERFORMED IN
SUCH STATE AND ANY APPLICABLE LAW OF THE UNITED STATES OF AMERICA, EXCEPT THAT AT ALL TIMES THE
PROVISIONS FOR THE CREATION, PERFECTION, PRIORITY, ENFORCEMENT AND FORECLOSURE OF THE LIENS AND
SECURITY INTERESTS CREATED HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED ACCORDING TO THE LAW OF THE
STATE IN WHICH THE PREMISES ARE LOCATED, IT BEING UNDERSTOOD THAT, TO THE FULLEST EXTENT PERMITTED
BY THE LAW OF SUCH STATE, THE LAW OF THE STATE OF NEW YORK SHALL GOVERN THE VALIDITY AND
ENFORCEABILITY OF ALL LOAN DOCUMENTS, AND THE DEBT OR OBLIGATIONS ARISING HEREUNDER.

     Section 18.14. Security Agreement. (a) (i) This Security Instrument is both a real
property mortgage, deed to secure debt or deed of trust, as applicable, and a “security agreement”
within the meaning of the UCC. 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. This
Security Instrument is filed as a fixture filing and covers goods which are or are to become
fixtures on the Property. Borrower by executing and delivering this Security Instrument has
granted to Lender, as security for the Debt, a security interest in the Property to the full
extent that the Property may be subject to the UCC (said portion of the Property so subject to the
UCC being called in this Section 18.14 the “Collateral”). If an Event of Default shall
occur, 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 UCC, 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 following an Event of Default, Borrower shall, at its expense, assemble the
Collateral and make it available to Lender at a convenient place 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. Any disposition pursuant to the UCC
of so much of the Collateral as may constitute personal property shall be considered commercially
reasonable if made pursuant to a public sale which is advertised at least twice in a newspaper in
which sheriff’s sales are advertised in the county where the Premises is located. Any notice of
sale, disposition or other intended action by Lender with respect to the Collateral given to
Borrower in accordance with the provisions hereof at least ten (10) days prior to such action,
shall constitute reasonable notice to Borrower. The proceeds of any disposition of the Collateral,
or any part thereof, may be applied by Lender to the payment of the Debt in such priority and
proportions as Lender in its discretion shall deem proper. It is not necessary that the Collateral
be present at any disposition thereof. Lender shall have no obligation to clean-up or otherwise
prepare the Collateral for disposition.

     (ii) The mention in a financing statement filed in the records normally pertaining to
personal property of any portion of the Property shall not derogate from or impair in any
manner the intention of this Security Instrument. Lender hereby declares that all items of
Collateral are part of the real property encumbered hereby to the fullest extent permitted
by law, regardless of whether any such item is physically attached to the Improvements or
whether serial numbers are used for the better identification of certain items.
Specifically, the mention in any such financing statement of any items included in the
Property shall not be construed to alter, impair or impugn any rights of Lender as
determined by this Security Instrument or the priority of Lender’s lien upon and security
interest in the Property in the event that notice of Lender’s priority of interest as to any
portion of the Property is required to be filed in accordance with the UCC to be effective
against or take priority over the interest of any particular class of persons, including the
federal government or any subdivision or instrumentality thereof. No portion of the
Collateral constitutes or is the proceeds of “Farm Products”, as defined in the UCC.

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     (iii) If Borrower is at any time a beneficiary under a letter of credit 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 (A) 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 (B) arrange for 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 to credit are to be applied as provided in this Security Instrument.

     (iv) Borrower and Lender acknowledge that for the purposes of Article 9 of the UCC,
the law of the State of New York shall be the law of the jurisdiction of the bank in which
the Central Account is located.

     (v) Lender may comply with any applicable Legal Requirements in connection with the
disposition of the Collateral, and Lender’s compliance therewith will not be considered to
adversely affect the commercial reasonableness of any sale of the Collateral.

     (vi) Lender may sell the Collateral without giving any warranties as to the Collateral.
Lender may specifically disclaim any warranties of title, possession, quiet enjoyment or the
like. This procedure will not be considered to adversely affect the commercial
reasonableness of any sale of the Collateral.

     (vii) If Lender sells any of the Collateral upon credit, Borrower will be credited only
with payments actually made by the purchaser, received by Lender and applied to the
indebtedness of Borrower. In the event the purchaser of the Collateral fails to fully pay
for the Collateral, Lender may resell the Collateral and Borrower will be credited with the
proceeds of such sale.

     (b) Borrower hereby irrevocably appoints Lender as its attorney-in-fact, coupled with an
interest, to file with the appropriate public office on its behalf any financing or other
statements signed only by Lender, as secured party, or, to the extent permitted under the UCC,
unsigned, in connection with the Collateral covered by this Security Instrument.

     Section 18.15. Actions and Proceedings. Lender has the right to appear in and defend
any action or proceeding brought with respect to the Property in its own name or, if required by
Legal Requirements or, if in Lender’s reasonable judgment, it is necessary, in the name and on
behalf of Borrower, which Lender believes will adversely affect the Property or this Security
Instrument and to bring any action or proceedings, in its name or 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 18.16. Usury Laws. This Security Instrument and the Note are subject to the
express condition, and it is the expressed intent of the parties, that at no time shall Borrower be
obligated or required to pay interest on the principal balance due under the Note at a rate which
could subject the holder of the Note to either civil or criminal liability as a result of being in
excess of the maximum interest rate which Borrower is permitted by law to contract or agree to pay.
If by the terms of this Security Instrument or the Note, Borrower is at any time required or
obligated to pay interest on the principal balance due under the Note at a rate in excess of such
maximum rate, such rate of interest shall be deemed to be immediately reduced to such maximum rate
and the interest payable shall be computed at such maximum rate and all prior interest payments in
excess of such maximum rate shall be applied and shall be deemed to have been payments in reduction
of the principal balance of the Note. No application to the principal balance of the Note pursuant
to this Section 18.16 shall give rise to any requirement to pay any prepayment fee or charge of any
kind due hereunder, if any.

     Section 18.17. Remedies of Borrower. In the event that a claim or adjudication is
made that Lender has acted unreasonably or unreasonably delayed acting in any case where by law or
under the Note, this Security Instrument or the Loan Documents, it has an obligation to act
reasonably or promptly, Lender shall not be liable for any monetary damages, and Borrower’s
remedies shall be limited to injunctive relief or declaratory judgment.

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     Section 18.18. Offsets, Counterclaims and Defenses. Any assignee of this Security
Instrument, the Assignment and the Note shall take the same free and clear of all offsets,
counterclaims or defenses which are unrelated to the Note, the Assignment or this Security
Instrument which Borrower may otherwise have against any assignor of this Security Instrument, the
Assignment and the Note and no such unrelated counterclaim or defense shall be interposed or
asserted by Borrower in any action or proceeding brought by any such assignee upon this Security
Instrument, the Assignment or the Note and any such right to interpose or assert any such unrelated
offset, counterclaim or defense in any such action or proceeding is hereby expressly waived by
Borrower.

     Section 18.19. No Merger. If Borrower’s and Lender’s estates become the same
including, without limitation, upon the delivery of a deed by Borrower in lieu of a foreclosure
sale, or upon a purchase of the Property by Lender in a foreclosure sale, this Security Instrument
and the lien created hereby shall not be destroyed or terminated by the application of the doctrine
of merger and in such event Lender shall continue to have and enjoy all of the rights and
privileges of Lender as to the separate estates; and, as a consequence thereof, upon the
foreclosure of the lien created by this Security Instrument, any Leases or subleases then existing
and created by Borrower shall not be destroyed or terminated by application of the law of merger or
as a result of such foreclosure unless Lender or any purchaser at any such foreclosure sale shall
so elect. No act by or on behalf of Lender or any such purchaser shall constitute a termination of
any Lease or sublease unless Lender or such purchaser shall give written notice thereof to such
lessee or sublessee.

     Section 18.20. Restoration of Rights. In case Lender shall have proceeded to enforce
any right under this Security Instrument by foreclosure sale, entry or otherwise, and such
proceedings shall have been discontinued or abandoned for any reason or shall have been determined
adversely, then, in every such case, Borrower and Lender shall be restored to their former
positions and rights hereunder with respect to the Property subject to the lien hereof.

     Section 18.21. Waiver of Statute of Limitations. The pleadings of any statute of
limitations as a defense to any and all obligations secured by this Security Instrument are hereby
waived to the full extent permitted by Legal Requirements.

     Section 18.22. Advances. This Security Instrument shall cover any and all advances
made pursuant to the Loan Documents, rearrangements and renewals of the Debt and all extensions in
the time of payment thereof, even though such advances, extensions or renewals be evidenced by new
promissory notes or other instruments hereafter executed and irrespective of whether filed or
recorded. Likewise, the execution of this Security Instrument shall not impair or affect any other
security which may be given to secure the payment of the Debt, and all such additional security
shall be considered as cumulative. The taking of additional security, execution of partial
releases of the security, or any extension of time of payment of the Debt shall not diminish the
force, effect or lien of this Security Instrument and shall not affect or impair the liability of
Borrower and shall not affect or impair the liability of any maker, surety, or endorser for the
payment of the Debt.

     Section 18.23. Application of Default Rate Not a Waiver. Application of the Default
Rate shall not be deemed to constitute a waiver of any Default or Event of Default or any rights or
remedies of Lender under this Security Instrument, any other Loan Document or applicable Legal
Requirements, or a consent to any extension of time for the payment or performance of any
obligation with respect to which the Default Rate may be invoked.

     Section 18.24. Intervening Lien. To the fullest extent permitted by law, any
agreement hereafter made pursuant to this Security Instrument shall be superior to the rights of
the holder of any intervening lien.

     Section 18.25. No Joint Venture or Partnership. Borrower and Lender intend that the
relationship created hereunder be solely that of mortgagor and mortgagee or grantor and beneficiary
or borrower and lender, as the case may be. Nothing herein is intended to create a joint venture,
partnership, tenancy-in-common, or joint tenancy relationship between Borrower and Lender nor to
grant Lender any interest in the Property other than that of mortgagee, beneficiary or lender.

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     Section 18.26. Time of the Essence. Time shall be of the essence in the performance
of all obligations of Borrower hereunder.

     Section 18.27. Borrower’s Obligations Absolute. Borrower acknowledges that Lender
and/or certain Affiliates of Lender are engaged in the business of financing, owning, operating,
leasing, managing, and brokering real estate and in other business ventures which may be viewed as
adverse to or competitive with the business, prospect, profits, operations or condition (financial
or otherwise) of Borrower. Except as set forth to the contrary in the Loan Documents, all sums
payable by Borrower hereunder shall be paid without notice or demand, counterclaim, set-off,
deduction or defense and without abatement, suspension, deferment, diminution or reduction, and the
obligations and liabilities of Borrower hereunder shall in no way be released, discharged, or
otherwise affected (except as expressly provided herein) by reason of: (a) any damage to or
destruction of or any Taking of the Property or any portion thereof or any other
Cross-collateralized Property; (b) any restriction or prevention of or interference with any use of
the Property or any portion thereof or any other Cross-collateralized Property; (c) any title
defect or encumbrance or any eviction from the Premises or any portion thereof by title paramount
or otherwise; (d) any bankruptcy proceeding relating to Borrower, any General Partner, or any
guarantor or indemnitor, or any action taken with respect to this Security Instrument or any other
Loan Document by any trustee or receiver of Borrower or any other Cross-collateralized Borrower or
any such General Partner, guarantor or indemnitor, or by any court, in any such proceeding; (e) any
claim which Borrower has or might have against Lender; (f) any default or failure on the part of
Lender to perform or comply with any of the terms hereof or of any other agreement with Borrower or
any other Cross-collateralized Borrower; or (g) any other occurrence whatsoever, whether similar or
dissimilar to the foregoing, whether or not Borrower shall have notice or knowledge of any of the
foregoing.

     Section 18.28. Publicity. All promotional news releases, publicity or advertising by
Manager, Borrower or their respective Affiliates through any media intended to reach the general
public shall not refer to the Loan Documents or the financing evidenced by the Loan Documents, or
to Lender or to any of its Affiliates without the prior written approval of Lender or such
Affiliate, as applicable, in each instance, such approval not to be unreasonably withheld or
delayed. Notwithstanding anything herein to the contrary, Borrower shall be authorized to provide
information relating to the Loan Documents or the financing evidenced by the Loan Documents, or to
Lender or to any of its Affiliates, to rating agencies, underwriters, potential securities
investors, auditors, regulatory authorities and to any Persons which may be entitled to such
information by operation of law and without limiting the foregoing to issue press releases and make
Form 8-K and other securities filings containing the above-described information as it or its
counsel reasonably deems required by law. Lender shall be authorized to provide information
relating to the Property, the Loan and matters relating thereto to rating agencies, underwriters,
potential securities investors, auditors, regulatory authorities and to any Persons which may be
entitled to such information by operation of law and may use basic transaction information
(including, without limitation, the name of Borrower, the name and address of the Property and the
Loan Amount) in press releases or other marketing materials.

     Section 18.29. Securitization Opinions. In the event the Loan is included as an asset
of a Securitization by Lender or any of its Affiliates, Borrower shall, within ten (10) Business
Days after Lender’s written request therefor, at Lender’s sole cost and expense, deliver opinions
in form and substance and delivered by counsel reasonably acceptable to Lender and each Rating
Agency, as may be reasonably required by Lender and/or the Rating Agency in connection with such
securitization. Borrower’s failure to deliver the opinions required hereby within such ten (10)
Business Day period shall constitute an “Event of Default” hereunder.

     Section 18.30. Cooperation with Rating Agencies; etc. Borrower covenants and agrees
that in the event the Loan is to be included as an asset of a Securitization, Borrower shall, at
the sole cost and expense of Lender, (a) gather any information reasonably required by each Rating
Agency in connection with such a Securitization, (b) at Lender’s request, meet with representatives
of each Rating Agency to discuss the business and operations of the Property, and (c) cooperate
with the reasonable requests of each Rating Agency and Lender in connection with all of the
foregoing as well as in connection with all other matters and the preparation of any offering
documents with respect thereto, including, without limitation, entering into any amendments or
modifications to this Security Instrument or to any other Loan Document which may be requested by
Lender to conform to Rating Agency or market standards for a Securitization provided that no such
modification shall modify (a) the interest rate payable under the Note, (b) the stated maturity of
the Note, (c) the amortization of principal under the Note, (d) Section

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18.32 hereof, (e) any other material economic term of the Loan or (f) any provision, the
effect of which would materially increase Borrower’s obligations or materially decrease Borrower’s
rights under the Loan Documents. Borrower acknowledges that the information provided by Borrower
to Lender may be incorporated into the offering documents for a Securitization and to the fullest
extent permitted, Borrower irrevocably waives all rights, if any, to prohibit such disclosures
including, without limitation, any right of privacy. Lender and each Rating Agency shall be
entitled to rely on the information supplied by, or on behalf of, Borrower and Borrower indemnifies
and holds harmless the Indemnified Parties, their Affiliates and each Person who controls such
Persons within the meaning of Section 15 of the Securities Act or Section 20 of the Securities
Exchange Act of 1934, as same may be amended from time to time, for, from and against any claims,
demands, penalties, fines, liabilities, settlements, damages, costs and expenses of whatever kind
or nature, known or unknown, contingent or otherwise, whether incurred or imposed within or outside
the judicial process, including, without limitation, reasonable attorneys’ fees and disbursements
that arise out of or are based upon any untrue statement or alleged untrue statement of any
material fact contained in such information supplied by or on behalf of Borrower or arise out of or
are based upon the omission or alleged omission to state therein a material fact required to be
stated in such information supplied by or on behalf of Borrower or necessary in order to make the
statements in such information, or in light of the circumstances under which they were made, not
misleading.

     Section 18.31. Securitization Financials. Borrower covenants and agrees that, upon
Lender’s written request therefor in connection with a Securitization, Borrower shall, at Lender’s
sole cost and expense, deliver as soon as is reasonably practicable (a) audited financial
statements and related documentation prepared by an Independent certified public accountant that
satisfy securities laws and requirements for use in a public registration statement (which may
include up to three (3) years of historical audited financial statements) and (b) if, at the time
one or more Disclosure Documents are being prepared in connection with a Securitization, Lender
expects that Borrower alone or Borrower and one or more of its Affiliates collectively, or the
Property alone or the Property and any other parcel(s) of real property, together with improvements
thereon and personal property related thereto, that is “related”, within the meaning of the
definition of Significant Obligor, to the Property (a “Related Property”) collectively,
will be a Significant Obligor, Borrower shall furnish to Lender upon request (i) the selected
financial data or, if applicable, net operating income, required under Item 1112(b)(1) of
Regulation AB and meeting the requirements thereof, if Lender expects that the principal amount of
the Loan, together with any loans made to an Affiliate of Borrower or secured by a Related Property
that is included in a Securitization with the Loan (a “Related Loan”), as of the cut-off
date for such Securitization may, or if the principal amount of the Loan together with any Related
Loans as of the cut-off date for such Securitization and at any time during which the Loan and any
Related Loans are included in a Securitization does, equal or exceed ten percent (10%) (but less
than twenty percent (20%)) of the aggregate principal amount of all mortgage loans included or
expected to be included, as applicable, in the Securitization or (ii) the financial statements
required under Item 1112(b)(2) of Regulation AB and meeting the requirements thereof, if Lender
expects that the principal amount of the Loan together with any Related Loans as of the cut-off
date for such Securitization may, or if the principal amount of the Loan together with any Related
Loans as of the cut-off date for such Securitization and at any time during which the Loan and any
Related Loans are included in a Securitization does, equal or exceed twenty percent (20%) of the
aggregate principal amount of all mortgage loans included or expected to be included, as
applicable, in the Securitization. Such financial data or financial statements shall be furnished
to Lender as soon as reasonably practicable but in all events within twenty(20) Business Days after
notice from Lender in connection with the preparation of Disclosure Documents for the
Securitization and, with respect to the data or financial statements required pursuant to clause
(b) hereof, (A) not later than thirty (30) days after the end of each fiscal quarter of Borrower
and (B) not later than seventy-five (75) days after the end of each Fiscal Year; provided, however,
that Borrower shall not be obligated to furnish financial data or financial statements pursuant to
clauses (A) or (B) of this sentence with respect to any period for which a filing pursuant to the
Securities Exchange Act of 1934 in connection with or relating to the Securitization is not
required.

     Section 18.32. Exculpation. Notwithstanding anything in this Security Instrument or
in any other Loan Document to the contrary, except as otherwise set forth in this Section 18.32 to
the contrary, Lender shall not enforce the liability and obligation of Borrower or any Person
holding a direct or indirect interest in Borrower or (a) if Borrower or any of its direct or
indirect owners is a partnership, its or their direct or indirect constituent partners or any of
their respective partners, (b) if Borrower or any of its direct or indirect owners is a trust, its
or their beneficiaries or any of their respective Partners (as hereinafter defined), (c) if
Borrower or any of its direct or

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indirect owners is a corporation, any of its or their direct or indirect shareholders,
directors, principals, officers or employees, or (d) if Borrower or any of its direct or indirect
owners is a limited liability company, any of its or their direct or indirect members (the Persons
described in the foregoing clauses (a) — (d), as the case may be, are hereinafter referred to as
the “Partners”) to perform and observe the obligations contained in this Security
Instrument or any of the other Loan Documents by any action or proceeding, including, without
limitation, any action or proceeding wherein a money judgment shall be sought against Borrower or
the Partners, except that Lender may bring a foreclosure action, action for specific performance,
or other appropriate action or proceeding (including, without limitation, an action to obtain a
deficiency judgment) against Borrower solely for the purpose of enabling Lender to realize upon (i)
Borrower’s interest in the Property, (ii) the Rent to the extent received by Borrower during the
existence of an Event of Default (all Rent covered by this clause (ii) being hereinafter referred
to as the “Recourse Distributions”) and not applied towards Debt Service or the operation
or maintenance of the Property and (iii) any other collateral then subject to the Loan Documents
(the collateral described in the foregoing clauses (i) — (iii) is hereinafter referred to as the
“Default Collateral”); provided, however, that any judgment in any such action or
proceeding shall be enforceable against Borrower and the Partners only to the extent of any such
Default Collateral. The provisions of this Section shall not, however, (a) impair the validity of
the Debt evidenced by the Note or in any way affect or impair the lien of this Security Instrument
or any of the other Loan Documents or the right of Lender to foreclose this Security Instrument
during the existence of an Event of Default the cure of which has not been accepted by Lender; (b)
impair the right of Lender to name Borrower as a party defendant in any action or suit for judicial
foreclosure and sale under this Security Instrument; (c) affect the validity or enforceability of
the Note, this Security Instrument, or any of the other Loan Documents, or impair the right of
Lender to seek a personal judgment against Guarantor to the extent and for the obligations
guaranteed in the Guaranty; (d) impair the right of Lender to obtain the appointment of a receiver;
(e) impair the enforcement of the Assignment; (f) impair the right of Lender to bring suit for a
monetary judgment against Borrower with respect to fraud or material misrepresentation by Borrower,
or any Affiliate of Borrower in connection with this Security Instrument, the Note or the other
Loan Documents, and the foregoing provisions shall not modify, diminish or discharge the liability
of Borrower or Guarantor to the extent of Guarantor’s liability under the Guaranty delivered by
Guarantor with respect to same; (g) impair the right of Lender to bring suit for a monetary
judgment to obtain the Recourse Distributions received by Borrower including, without limitation,
the right to bring suit for a monetary judgement to proceed against any Guarantor to the extent of
Guarantor’s liability under any guaranty delivered by Guarantor and the foregoing provisions shall
not modify, diminish or discharge the liability of Borrower or Guarantor with respect to same; (h)
impair the right of Lender to bring suit for a monetary judgment against Borrower with respect to
Borrower’s misappropriation of tenant security deposits or Rent, and the foregoing provisions shall
not modify, diminish or discharge the liability of Borrower or Guarantor to the extent of
Guarantor’s liability under any guaranty delivered by Guarantor with respect to same; (i) impair
the right of Lender to obtain Loss Proceeds due to Lender pursuant to this Security Instrument; (j)
impair the right of Lender to enforce the provisions of Sections 2.02(g) (other than the provisions
of clause (vii) thereof), 12.01, 16.01 or 16.02, 18.29, 18.30 or 18.31, inclusive of this Security
Instrument, even after repayment in full by Borrower of the Debt or to bring suit for a monetary
judgment against Borrower with respect to any obligation set forth in said Sections; (k) prevent or
in any way hinder Lender from exercising, or constitute a defense, or counterclaim, or other basis
for relief in respect of the exercise of, any other remedy against any or all of the collateral
securing the Note as provided in the Loan Documents; (l) impair the right of Lender to bring suit
for a monetary judgment against Borrower with respect to any misapplication or conversion of Loss
Proceeds, and the foregoing provisions shall not modify, diminish or discharge the liability of
Borrower or Guarantor to the extent of Guarantor’s liability under any guaranty delivered by
Guarantor with respect to same; (m) impair the right of Lender to sue for, seek or demand a
deficiency judgment against Borrower solely for the purpose of foreclosing the Property or any part
thereof, or realizing upon the Default Collateral; provided, however, that any such
deficiency judgment referred to in this clause (m) shall be enforceable against Borrower and
Guarantor only to the extent of any of the Default Collateral; (n) impair the ability of Lender to
bring suit for a monetary judgment against Borrower with respect to arson or physical waste to or
of the Property or damage to the Property resulting from the gross negligence or willful misconduct
of Borrower or, to the extent that there is sufficient cash flow, failure to pay any Imposition, or
in lieu thereof, deposit a sum equal to any Impositions into the Basic Carrying Costs Sub-Account;
(o) impair the right of Lender to bring a suit for a monetary judgment against Borrower in the
event of the exercise of any right or remedy under any federal, state or local forfeiture laws
resulting in the loss of the lien of this Security Instrument, or the priority thereof, against the
Property; (p) be deemed a waiver of any right which Lender may have under Sections 506(a), 506(b),
1111(b) or any other provision of the Bankruptcy Code to file a claim for the full amount of the
Debt or to require that all collateral shall continue to

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secure all of the Debt; (q) impair the right of Lender to bring suit for monetary judgment
against Borrower with respect to any losses resulting from any claims, actions or proceedings
initiated by Borrower (or any Affiliate of Borrower) alleging that the relationship of Borrower and
Lender is that of joint venturers, partners, tenants in common, joint tenants or any relationship
other than that of debtor and creditor; (r) impair the right of Lender to bring suit for a monetary
judgment against Borrower in the event of a Transfer in violation of the provisions of Article IX
hereof; (s) impair the right of Lender to bring suit for a monetary judgment in the event that
Borrower moves its principal place of business or its books and records relating to the Property
which are governed by the UCC, or changes its name, its jurisdiction of organization, type of
organization or other legal structure or, if it has one, organizational identification number,
without first giving Lender thirty (30) days prior written notice; (t) in the event Borrower is a
tenancy-in-common, impair the right of Lender to bring suit for monetary judgment against any TIC
which commences a partition action; (u) in the event Borrower is a tenancy-in-common, impair the
right of Lender to bring suit for monetary judgment against any TIC or Guarantor in the event the
TIC Agreement is modified or amended without obtaining the prior written consent of Lender or if
the Person appointed in the TIC Agreement as manager is replaced or removed without the prior
written consent of Lender; or (v) impair the right of Lender to bring suit for a monetary judgment
in the event that Borrower changes its name or otherwise does anything which would make the
information set forth in any UCC Financing Statements relating to the Property materially
misleading without giving Lender thirty (30) days prior written notice thereof. The provisions of
this Section 18.32 shall be inapplicable to Borrower if (a) any proceeding, action, petition or
filing under the Bankruptcy Code, or any similar state or federal law now or hereafter in effect
relating to bankruptcy, reorganization or insolvency, or the arrangement or adjustment of debts,
shall be (A) filed by Borrower or Guarantor or (B) filed against Borrower or Guarantor and
consented to or acquiesced in by Borrower or Guarantor or if any Affiliate of Borrower or
Guarantor, or if Borrower or Guarantor or any Affiliate of either of them shall institute any
proceeding for Borrower’s dissolution or liquidation, or Borrower or Guarantor shall make an
assignment for the benefit of creditors, or (b) Borrower or any Affiliate contests in bad faith or
in any material way interferes with in bad faith, directly or indirectly (collectively, a
“Contest”), any foreclosure action, UCC sale or other material remedy exercised by Lender
upon the occurrence of an Event of Default whether by making any motion, bringing any counterclaim
(other than a compulsory counterclaim), claiming any defense, seeking any injunction or other
restraint, commencing any action, or otherwise in bad faith (provided that if any such Person
obtains a non-appealable order successfully asserting a Contest, Borrower shall have no liability
under this clause (b)), in which event Lender shall have recourse against all of the assets of
Borrower including, without limitation, any right, title and interest of Borrower in and to the
Property.

     Section 18.33. Intentionally Omitted.

     Section 18.34. Intentionally Omitted.

     Section 18.35. Mezzanine Loan Option. (a) Lender shall have the right at any time to
divide the Loan into two or more parts (the “Mezzanine Option”): a “mortgage loan” and one
or more “mezzanine loans.” The principal amount of the mortgage loan plus the principal amount of
the mezzanine loan(s) shall equal the outstanding principal balance of the Loan immediately prior
to the creation of the mortgage loan and the mezzanine loan(s). In effectuating the foregoing,
Lender will make one or more loans to one or more entities that will be the direct or indirect
equity owner(s) of Borrower as described in Section 18.35(b) (collectively, the “Mezzanine
Borrower”). The Mezzanine Borrower will contribute the amount of the mezzanine loan(s) to
Borrower (in its capacity as borrower under the mortgage loan, “mortgage borrower”) and the
mortgage borrower will apply the contribution to pay down the Loan to the mortgage loan amount.
The mortgage loan and the mezzanine loan(s) will be on the same terms and subject to the same
conditions set forth in the Loan Documents except as follows. The mezzanine loan(s) shall be made
pursuant to Lender’s standard mezzanine loan documents.

     (b) Lender shall have the right to establish different interest rates and debt service
payments for the mortgage loan and the mezzanine loan(s) and to require the payment of the mortgage
loan and the mezzanine loan(s) in such order of priority as may be designated by Lender; provided,
that (i) the total loan amounts for the mortgage loan and the mezzanine loan(s) shall equal the
amount of the Loan immediately prior to the creation of the mortgage loan and the mezzanine
loan(s), (ii) the weighted average interest rate of the mortgage loan and the mezzanine loan(s)
shall on the date created equal the interest rate which was applicable to the Loan immediately
prior to

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creation of the mortgage loan and mezzanine loan(s) and (iii) the debt service payments on the
mortgage loan note and the mezzanine loan note(s) shall on the date created equal the debt service
payment which was due under the Loan immediately prior to creation of a mortgage loan and a
mezzanine loan(s).

     (c) The Mezzanine Borrower shall be a special purpose, bankruptcy remote entity pursuant to
applicable Rating Agency criteria and shall own directly or indirectly one hundred percent (100%)
of the mortgage borrower. The security for the mezzanine loan(s) shall be a pledge of one hundred
percent (100%) of the direct and indirect ownership interests in the mortgage borrower.

     (d) Borrower shall cooperate with all reasonable requests of Lender in order to convert the
Loan into a mortgage loan and one or more mezzanine loans and shall execute and deliver such
documents as shall reasonably be required by Lender in connection therewith, including, without
limitation, the delivery of non-consolidation, enforceability, authorization and execution opinions
and an “Eagle 9” or “UCC plus” (or equivalent) UCC insurance policy and the modification of
organizational documents and loan documents and the transfer of the membership interest in Borrower
to the Mezzanine Borrower.

     It shall be an Event of Default if Borrower fails to cooperate in all reasonable respects in
effectuating any of the terms, covenants or conditions of this Section 18.35 after expiration of
ten (10) Business Days notice of non-cooperation.

     Section 18.36. Component Notes. Lender, without in any way limiting Lender’s other
rights hereunder, in its sole and absolute discretion, shall have the right at any time to require
Borrower to execute and deliver “component” notes (including senior and junior notes), which notes
may be paid in such order of priority as may be designated by Lender, provided that (a) the
aggregate principal amount of such “component” notes shall equal the outstanding principal balance
of the Loan immediately prior to the creation of such “component” notes, (b) the weighted average
interest rate of all such “component” notes shall on the date created equal the interest rate which
was applicable to the Loan immediately prior to the creation of such “component” notes (it being
acknowledged by Borrower that if an Event of Default occurs during the term of the Loan, whether or
not it is subsequently cured, the weighted average interest rates of the “component” notes may
increase (i.e. the Loan may have “rate creep”)), (c) the debt service payments on all such
“component” notes shall on the date created equal the debt service payment which was and would be
due under the Loan immediately prior to the creation of such component notes (it being acknowledged
by Borrower that if an Event of Default occurs during the term of the Loan, whether or not it is
subsequently cured, the weighted average interest rates of the “component” notes may increase (i.e.
the Loan may have “rate creep”)) and (d) the other terms and provisions of each of the “component”
notes shall be identical in substance and substantially similar in form to the Loan Documents.
Borrower shall cooperate with all reasonable requests of Lender in order to establish the
“component” notes and shall execute and deliver such documents as shall reasonably be required by
Lender in connection therewith, all in form and substance reasonably satisfactory to Lender,
including, without limitation, the severance of security documents if requested. It shall be an
Event of Default if Borrower fails to comply with any of the terms, covenants or conditions of this
Section 18.36 after the expiration of ten (10) Business Days after notice thereof.

     Section 18.37. Intentionally Omitted.

     Section 18.38. Certain Matters Relating to Property located in the State of Florida.
With respect to the Property which is located in the State of Florida, notwithstanding anything
contained herein to the contrary:

     (a) It is agreed that, in addition to existing indebtedness, any future advances made by the
then holder of the Note to or for the benefit of Borrower or Borrower’s permitted assignees,
whether such advances are obligatory or are made at the option of Lender, or otherwise, at any time
within twenty (20) years from the date of this Security Instrument, with interest thereon at the
rate agreed upon at the time of each additional loan or advance, shall be equally secured with and
have the same priority as the Debt and be subject to all of the terms and provisions of this
Security Instrument, whether or not such additional loan or advance is evidenced by a promissory
note of Borrower and whether or not identified by a recital that it is secured by this Security
Instrument; provided that, although the total amount of the indebtedness that may be secured may
decrease to zero from time to time or may

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increase from time to time, the aggregate amount of outstanding Debt so secured at any one
time shall not exceed the sum of the Loan Amount multiplied by two (2), plus interest and
disbursements made for the payment of taxes, levies or insurance on the Property with interest on
such disbursements. It is understood and agreed that this future advance provision shall not be
construed to obligate Lender to make any such additional loans or advances. It is further agreed
that any additional note or notes executed and delivered under this future advance provision shall
be included in the words “Note” or “Debt” wherever either appears in the context of this Security
Instrument. Borrower, for itself and its successors in title and its successors and permitted
assigns, hereby expressly waives and relinquishes any rights granted under Section 697.04 of the
Florida Statutes, or otherwise, to limit the amount of indebtedness that may be secured by this
Security Instrument at any time during the term of this Security Instrument. Borrower further
covenants not to file for record any notice limiting the maximum principal amount that may be
secured by this Security Instrument and agrees that any such notice, if filed, shall be null and
void; and except as hereinafter provided, of no effect. In the event that, notwithstanding the
foregoing covenant, Borrower or its successor in title files for record any notice limiting the
maximum principal amount that may be secured by this Security Instrument in violation of the
foregoing covenant, the Debt shall, at the option of Lender, become immediately due and payable.

     (b) Notwithstanding anything to the contrary contained in this Security Instrument, Lender
shall comply with the requirements of Section 501.137. Florida Statutes, as applicable, with
respect to the payment of Impositions and insurance premiums from the Basic Carrying Costs
Sub-Account so that the maximum tax discount available may be obtained with regard to the Premises
and so that insurance coverage on the Property does not lapse.

     (c) The assignment of leases and rents contained in this Security Instrument is intended to
provide Lender with all the rights and remedies of lenders pursuant to Section 697.07 of the
Florida Statutes (hereinafter “Section 697.07”), as may be amended from time to time. However, in
no event shall this reference diminish, alter, impair, or affect any other rights and remedies of
Lender, including but not limited to, the appointment of a receiver as provided herein, nor shall
any provision in this Section diminish, alter, impair or affect any rights or powers of the
receiver in law or equity or as set forth herein. In addition, this assignment shall be fully
operative without regard to value of the Property or without regard to the adequacy of the Property
to serve as security for the obligations owed by Borrower to Lender, and shall be in addition to
any rights arising under Section 697.07. Further, except for the notices required hereunder, if
any, Borrower waives any notice of default or demand for turnover of rents by Lender, together with
any rights under Section 697.07 to apply to a court to deposit the Rents into the registry of the
court or such other depository as the court may designate.

     Section 18.39. Certain Matters Relating to Property Located in the State of Georgia.
With respect to the Property which is located in the State of Georgia, notwithstanding anything
contained herein to the contrary:

     (a) The terms “mortgage” and “hypothecate” which are contained in the “NOW THEREFORE”
paragraph of the first page hereof and in Sections 2.02(q), 2.03, 2.05(b), 2.05(f), 8.01(d), 15.02
and 18.14 hereof shall be deleted.

     (b) The terms “Borrower” and “Lender” contained in this Security Instrument shall be deemed to
be “Grantor” and “Grantee”, respectively.

     (c) The “PROVIDED ALWAYS” paragraph on page 5 hereof shall be deleted in its entirety and the
following provisions shall be inserted in its place:

     Grantor covenants that Grantor is lawfully seized and possessed of the Premises as
aforesaid, has good right to convey the same, and that the same are unencumbered except for
the Permitted Encumbrances. Grantor warrants and will forever defend the title to the
Premises against the claims of all persons whomsoever, except as to the Permitted
Encumbrances.

     This Deed is intended to operate and is to be construed as a deed passing the title to
the Premises to Lender and is made under those provisions of the existing laws of the State
of Georgia relating to deeds to secure debt, and not as a mortgage, and is given to secure
the payment of the Note, the final payment on

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which is due on Maturity, unless otherwise extended pursuant to the terms of the Note,
together with any and all renewals, modifications, consolidations and extensions of the
indebtedness evidenced thereby, together with the Debt, and together with any and all
additional advances made by Lender to protect or preserve the Property or the security
interests created hereby on the Property, or for taxes, assessments or insurance premiums as
hereinafter provided or for the performance of any of Grantor’s obligations hereunder or for
any other purpose provided herein (whether or not the original Grantor remains the owner of
the Property at the time of such advances).

     Should the Debt be paid according to the tenor and effect thereof when the same become
due and payable, and should Grantor perform all covenants contained in this Deed in a timely
manner, then Grantee shall cancel and surrender this Deed of record.

     (d) The definition of “Security Instrument” in Section 1.01 hereof shall be deleted in its
entirety and the following shall be inserted in its place:

     “Security Instrument” means this Deed to Secure Debt, Security Instrument and
Assignment of Rents as originally executed or as it may hereafter from time to time be
supplemented, amended, modified or extended by one or more indentures supplemental hereto.

     (e) The phrase “first mortgage” found in Section 2.06 hereof shall be deleted and the phrase
“first deed to secure debt” shall be inserted in its place.

     (f) Subsection 13.02(a)(vi) shall be deleted in its entirety and the following shall be
inserted in its place:

     (vi) sell the Property or any part of the Property at one or more public sale or sales
before the door of the courthouse of the county in which the Property or any part of the
Property is situated, to the highest bidder for cash, in order to pay the Debt, and all
expenses of sale and of all proceedings in connection therewith, including reasonable
attorney’s fees, after advertising the time, place and terms of sale once a week for four
(4) weeks immediately preceding such sale (but without regard to the number of days) in a
newspaper in which Sheriff’s sales are advertised in said county. At any such public sale,
Grantee may execute and deliver to the purchaser a conveyance of the Premises or any part of
the Premises in fee simple, with full warranties of title and, to this end, Grantor hereby
constitutes and appoints Grantee the agent and attorney-in-fact of Grantor to make such sale
and conveyance, and thereby to divest Grantor of all right, title and equity that Grantor
may have in and to the Premises and to vest the same in the purchaser of purchasers at such
sale or sales, and all the acts and doings of said agent and attorney-in-fact are hereby
ratified and confirmed and any recitals in said conveyance or conveyances as to facts
essential to a valid sale shall be binding upon Grantor. The aforesaid power of sale and
agency hereby granted are coupled with an interest and are irrevocable by death or
otherwise, are granted as cumulative of the other remedies provided hereby or by law for the
collection of the Debt, and shall not be exhausted by one exercise thereof, but may be
exercised until full payment of all of the Debt. In the event of any sale under this
Security Instrument by virtue of the exercise of the powers herein granted, or pursuant to
any order in any judicial proceedings or otherwise, the Premises may be sold as an entirety
or in separate parcels and in such manner or order as Lender, in its sole discretion, may
elect, and if Grantee so elects, Grantee may sell the personal property covered by this
Security Instrument at one or more separate sales in any manner permitted by the Uniform
Commercial Code, and one or more exercises of the powers herein granted shall not extinguish
nor exhaust such powers, until the entire Property are sold or the Debt is paid in full.

     (g) As this instrument is a deed passing legal title pursuant to the laws of the State of
Georgia, and is not a mortgage, whenever reference herein is made to the “lien of this Security
Instrument”, or words of similar import, such words shall be construed as meaning the security
title and interest created and conveyed by this Deed.

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     (h) Whenever reference is made herein to “reasonable attorney’s fees” or similar words, such
reference shall mean attorney’s fees computed based upon the attorney’s normal hourly rates and the
amount of time expended, and not the statutory attorney’s fees provided by Official Code of Georgia
Annotated § 13-1-11.

     (i) GRANTOR EXPRESSLY WAIVES THE FOLLOWING: (A) ANY RIGHT GRANTOR MAY HAVE UNDER THE
CONSTITUTION OF THE STATE OF GEORGIA OR THE CONSTITUTION OF THE UNITED STATES OF AMERICA TO NOTICE
OR TO A JUDICIAL HEARING PRIOR TO THE EXERCISE OF ANY RIGHT OR REMEDY PROVIDED TO GRANTEE BY THIS
“SECURITY INSTRUMENT” AND GRANTOR WAIVES GRANTOR’S RIGHTS, IF ANY, TO SET ASIDE OR INVALIDATE ANY
SALE UNDER POWER DULY CONSUMMATED IN ACCORDANCE WITH THE PROVISIONS OF THIS SECURITY INSTRUMENT ON
THE GROUND (IF SUCH BE THE CASE) THAT THE SALE WAS CONSUMMATED WITHOUT PRIOR NOTICE OR JUDICIAL
HEARING OR BOTH. ALL WAIVERS BY GRANTOR HEREIN HAVE BEEN MADE VOLUNTARILY, INTELLIGENTLY AND
KNOWINGLY BY GRANTOR, AFTER GRANTOR HAS BEEN AFFORDED THE OPPORTUNITY TO BE INFORMED BY COUNSEL OF
GRANTOR’S CHOICE AS TO POSSIBLE ALTERNATIVE RIGHTS AND THE EFFECT OF SAID WAIVERS. GRANTOR’S
EXECUTION OF THIS SECURITY INSTRUMENT SHALL BE CONCLUSIVE EVIDENCE OF THE MAKING OF SUCH WAIVERS
AND THAT SUCH WAIVERS HAVE BEEN VOLUNTARILY, INTELLIGENTLY AND KNOWINGLY MADE.

     (j) The Maturity Date is the Payment Date occurring in April, 2017.

     Section 18.40. Intentionally Omitted.

     Section 18.41. Intentionally Omitted.

     Section 18.42. Certain Matters Relating to Property Located in the State of New
Jersey. With respect to the Property which is located in the State of New Jersey,
notwithstanding anything contained herein to the Contrary:

     (a) Borrower represents and warrants that (i) all filings and submissions or other action
required pursuant to the New Jersey Industrial Site Recovery Act, N.J.S.A. 13:1K-6, et
seq., as modified (“ISRA”), if any, in connection with the Loan, have been made or
taken and (ii) the Property is not located within a “freshwater wetlands” or a “transition area,”
each as defined by N.J.S.A. 13:9B-3, and is not subject to the terms of the New Jersey Freshwater
Wetlands Protection Act, as amended, N.J.S.A. 13:9B-1 et. seq., or the rules and
regulations promulgated thereunder.

     (b) This Security Instrument shall be governed by and construed in accordance with the laws of
the State of New York, provided, however, that (i) matters of title to the Property located in New
Jersey, (ii) matters of creation, perfection and priority of the lien of this Security Instrument
and (iii) those procedural issues of foreclosure, deed in lieu of foreclosure or sale, which are
required to be governed by the laws of the State of New Jersey shall be governed by the laws of New
Jersey and construed in accordance therewith.

     (c) Borrower shall not conduct or cause or permit to be conducted on the Property any activity
which constitutes an Industrial Establishment (as such term is defined in ISRA) without the prior
written consent of Lender. In the event that the provisions of ISRA become applicable to the
Property subsequent to the date hereof, Borrower shall give prompt written notice thereof to Lender
and shall take immediate requisite action to insure full compliance therewith. Borrower shall
deliver to Lender copies of all correspondence, notices and submissions that it sends to or
receives from the New Jersey Department of Environmental Protection in connection with such ISRA
compliance. Borrower’s obligation to comply with ISRA shall, notwithstanding its general
applicability, also specifically apply to sale, transfer, closure or termination of operations
associated with any foreclosure action, including, without limitation, a foreclosure action brought
with respect to this Security Instrument. In connection with the purchase of the Property,
Borrower required that the seller of the Property comply with the provisions of ISRA and the seller
did comply therewith.

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     (d) The Property has not been and is not now being used as a Major Facility (as defined in the
Environmental Statutes), and Borrower shall not use the Property as a Major Facility in the future
without the prior written consent of Lender. If Borrower ever becomes an owner or operator of a
Major Facility, then Borrower shall furnish the New Jersey Department of Environmental Protection
with all the information required by N.J.S.A. 58:10-23.11d, and shall duly file with the Director
of the Division of Taxation in the New Jersey Department of the Treasury a tax report or return,
and shall pay all taxes due therewith, in accordance with N.J.S.A. 58:10-23, 11b.

     (e) This Security Instrument is subject to “modification” as such term is defined in P.L. 1985
c.353 (N.J.S.A. 46:9-8.1 et seq.) (the “Mortgage Modification Act”) and
shall be subject to the priority provisions of the Mortgage Modification Act.

     (f) Borrower represents and warrants that the loans or other financial accommodations included
as obligations secured by this Security Instrument were obtained solely for the purpose of carrying
on or acquiring a business or commercial investment and not for residential, consumer or household
purposes.

     Section 18.43. Intentionally Omitted.

     Section 18.44. Intentionally Omitted.

     Section 18.45. Certain Matters Relating to Property Located in the Commonwealth of
Pennsylvania. With respect to the Property which is located in the Commonwealth of
Pennsylvania, notwithstanding anything contained herein to the contrary:

     (a) FOR THE PURPOSE OF OBTAINING POSSESSION OF THE PROPERTY AND EXERCISING THE OTHER REMEDIES
PROVIDED IN THIS SECTION, IN THE EVENT OF ANY DEFAULT HEREUNDER OR UNDER THE NOTE, BORROWER HEREBY
AUTHORIZES THE PROTHONOTARY OR ANY ATTORNEY OF THE COURT OF RECORD WITHIN THE COMMONWEALTH OF
PENNSYLVANIA TO APPEAR FOR BORROWER TO FILE AN AGREEMENT FOR ENTERING IN ANY COURT OF COMPETENT
JURISDICTION ACTION FOR CONFESSION OF JUDGMENT IN EJECTMENT AGAINST BORROWER AND ALL PERSONS
CLAIMING UNDER BORROWER FOR POSSESSION OF THE PROPERTY, FOR WHICH THIS SECURITY INSTRUMENT OR A
TRUE CORRECT COPY THEREOF SHALL BE A SUFFICIENT WARRANT, WHEREUPON, IF LENDER SO DESIRES, A WRIT OF
POSSESSION MAY ISSUE FORTHWITH, WITHOUT ANY PRIOR WRIT OR PROCEEDINGS WHATSOEVER, AND PROVIDED THAT
IF FOR ANY REASON AFTER SUCH ACTION SHALL HAVE BEEN COMMENCED THE SAME SHALL BE TERMINATED AND
POSSESSION REMAIN IN OR BE RESTORED TO BORROWER, LENDER SHALL HAVE THE RIGHT UPON ANY SUBSEQUENT
DEFAULT OR DEFAULTS TO BRING ONE OR MORE ACTION OR ACTIONS AS HEREINBEFORE SET FORTH TO RECOVER
POSSESSION BY CONFESSION OF JUDGMENT AS AFORESAID. THE AUTHORITY AND POWER TO APPEAR AND CONFESS
JUDGMENT IN EJECTMENT AGAINST BORROWER SHALL NOT BE EXHAUSTED BY THE INITIAL EXERCISE THEREOF AND
MAY BE EXERCISED AS OFTEN AS LENDER SHALL FIND IT NECESSARY AND DESIRABLE AND THIS SECURITY
INSTRUMENT SHALL BE A SUFFICIENT WARRANT THEREFORE. IN THE EVENT OF ANY JUDGMENT CONFESSED AGAINST
BORROWER HEREUNDER IS STRICKEN OR OPENED UPON APPLICATION BY OR ON THE COMPANY’S BEHALF FOR ANY
REASON, LENDER IS HEREBY AUTHORIZED AND EMPOWERED TO AGAIN APPEAR FOR AND CONFESS JUDGMENT IN
EJECTMENT AGAINST BORROWER, AS PROVIDED FOR HEREIN, IF DOING SO WILL CURE ANY ERRORS OR DEFECTS IN
SUCH PRIOR PROCEDURES.

     BY SIGNING THIS INSTRUMENT, BORROWER HEREBY ACKNOWLEDGES THAT BORROWER HAS READ THIS SECURITY
INSTRUMENT (INCLUDING WITHOUT LIMITATION THE CONFESSION SET FORTH HEREIN), HAS HAD THE OPPORTUNITY
TO HAVE THE SAME REVIEWED BY LEGAL COUNSEL, UNDERSTANDS THE SAME, AND AGREES TO THE PROVISIONS
CONTAINED HEREIN, INCLUDING, WITHOUT LIMITATION, THE CONFESSION OF JUDGMENT PROVISIONS AND
UNDERSTANDS THAT A CONFESSION OF JUDGMENT CONSTITUTES A WAIVER OR RIGHTS

88

 

BORROWER OTHERWISE WOULD HAVE TO PRIOR NOTICE AND A HEARING BEFORE A JUDGMENT IS ENTERED
AGAINST BORROWER AND WHICH MAY RESULT IN A COURT JUDGMENT AGAINST BORROWER WITHOUT PRIOR NOTICE OR
HEARING.

     BORROWER HEREBY AUTHORIZES AND EMPOWERS THE PROTHONOTARY OR ANY ATTORNEY OR ANY COURT OF
RECORDS OR THE SHERIFF (OR THE LAWFUL DESIGNEE OF THE SHERIFF) WITHIN ANY COUNTY OF THE
COMMONWEALTH OF PENNSYLVANIA OR ELSEWHERE, TO TAKE ALL ACTION ALLOWED BY OR PROVIDED FOR IN THE
PENNSYLVANIA RULES OF CIVIL PROCEDURE OR OTHER APPLICABLE RULES OF CIVIL PROCEDURE TO EXECUTE ON
ANY JUDGMENT ENTERED AGAINST BORROWER PURSUANT TO THE CONFESSION OF JUDGMENT SET FORTH ABOVE
WITHOUT PRIOR NOTICE OR HEARING OF ANY NATURE WHATSOEVER, WAIVING ALL LAWS EXEMPTING REAL OR
PERSONAL PROPERTY FROM EXECUTION TO THE EXTENT THAT SUCH LAWS MAY LAWFULLY BE WAIVED. NO SINGLE
EXERCISE OF THE FOREGOING POWER TO EXECUTE ON JUDGMENTS WITHOUT A HEARING SHALL BE DEEMED TO
EXHAUST THE POWER, WHETHER OR NOT ANY SUCH EXERCISE SHALL BE HELD BY ANY COURT TO BE VALID,
VOIDABLE OR VOID, BUT THE POWER SHALL CONTINUE UNDIMINISHED AND IT MAY BE EXERCISED FROM TIME TO
TIME AS OFTEN AS THE AGENT SHALL ELECT.

	 
	 	 	DAB	 	 
	 

	 	 	 	 
	 

	 	[Borrower’s
Initials]
                     	 	 

     (b) This Security Instrument is an Open-End Mortgage. This Security Instrument secures, and
the Debt include, future advances. All advances and indebtedness arising and occurring from time
to time under this Security Instrument shall be secured hereby. The maximum amount of indebtedness
(as defined in 42 Pa. Stat. §8143, which term excludes interest and excludes advances and expenses
made by Lender to protect its interest in the Property) outstanding at any time which is secured by
this Security Instrument is the Loan Amount multiplied by two (2). Borrower hereby covenants and
agrees that it will not exercise, and hereby waives, its right under 42 Pa. Stat. §8143(c) to limit
the indebtedness secured by this Security Instrument.

     (c) This Security Instrument secures, and the Debt include, (i) all advances made by Lender
with respect to any of the Property for the payment of Basic Carrying Costs or other costs incurred
for the protection of any of the Property or the lien of this Security Instrument, (ii) all
expenses incurred by Lender by reason of an Event of Default hereunder and (iii) all advances made
by Lender to enable completion of construction of the Property. As provided in 42 Pa. Stat. §8144,
this Security Instrument shall constitute a lien on the Property from the time this Security
Instrument is left of record (or, if this is a purchase money mortgage, from the time of delivery
hereof to Lender) for, among other things, all such advances and expenses, plus interest thereon,
regardless of the time when such advances are made or such expenses are incurred. All notices to
be given to Lender pursuant to 42 Pa. Stat. §8143 shall be given as set forth in Section 11.01
hereof.

     (d) Borrower further waives the right of inquisition on all Property levied upon to collect
the indebtedness hereby secured and does voluntarily condemn the same and authorizes a Prothonotary
of the Commonwealth of Pennsylvania to enter into such condemnation.

* * * * *

89

 

     IN WITNESS WHEREOF, Borrower has duly executed this Security Instrument the day and year first
above written.

	 	 	 	 	 	 	 	 	 
	Borrower’s Organizational
Identification Number:
4306910	 	BORROWER:

	 	 
	 	 	ASHFORD EDISON LP, a Delaware limited partnership	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Ashford Sapphire V GP LLC, a Delaware

limited liability company, its general

partner	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	/s/ David A. Brooks	 	 
	 

	 	 	 	 	 	 

Name: David A. Brooks
	 	 
	 

	 	 	 	 	 	Title: Vice President	 	 

90

 

EXHIBIT A

LEGAL DESCRIPTION OF PREMISES

 

 

EXHIBIT B

SUMMARY OF RESERVES

See Cross-collateralization Agreement between Borrower and Lender of even date herewith.

 

EXHIBIT C

CROSS-COLLATERALIZED PROPERTIES, INITIAL ALLOCATED LOAN AMOUNTS AND RELEASE

PRICE PERCENTAGE

See Cross-collateralization Agreement between Borrower and Lender of even date herewith.

 

EXHIBIT D

REQUIRED ENGINEERING WORK

See Cross-collateralization Agreement between Borrower and Lender of even date herewith.

 

EXHIBIT E

Intentionally Omitted.

 

 

EXHIBIT F

APPROVED MANAGERS

Starwood Hotels and Resorts Worldwide Inc.

Marriott International, Inc.

Hilton Hotels Corporation

Hyatt

Interstate Hotels and Resorts

Remington

APPROVED FRANCHISERS

Starwood Hotels and Resorts Worldwide Inc.

Marriott International, Inc.

Hilton Hotels Corporation

Hyatt

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